Industrial Property Law

As an exception to the principle of exhaustion of rights, the trademark proprietor may oppose any new act of commercialization if he can show legitimate reasons, in particular relating to the subsequent modification or alteration of the condition of the goods (Article L. 713-4, paragraph 2, IP Code).

The following are legitimate reasons for the proprietor's right to his trademark to be renewed:

- The repackaging of a product bearing the trademark by a third party. However, the proprietor of the trademark cannot invoke this legitimate reason when the following conditions are met: he has been given prior notice of the repackaged product being put on sale, the use of the trademark right would lead, given the marketing system in place, to the partitioning of markets between Member States, the repackaging does not affect the original condition of the product and the new packaging specifies by whom the repackaging is carried out .

- The re-labelling of a marked product, i.e. the removal by a third party of the labels on the product and their reapplication or replacement. The owner of the trademark cannot rely on this legitimate reason when the changes made do not affect the original condition of the product or its image or reputation, the re-labelling is necessary for the marketing of the product in the Member State of importation, and the proprietor of the right is notified in advance. This legitimate reason cannot be invoked if the use of the trademark right contributes to artificially partitioning the markets between Member States .

- Serious harm to the image or reputation of the brand or manufacturer. Such harm may result from the plainness of the seller's premises, the conditions of presentation of the products, the mediocrity of the means of advertising  or the sale of the products to discounters or resellers in violation of a clause in the licensing agreement aimed at preserving the prestige of the trademark, when this infringement undermines the appearance and the image of prestige through which the products convey a sense of luxury .

The existence of a selective distribution network does not, in itself, constitute a legitimate reason for the proprietor of a trademark to oppose the marketing of the products bearing it by an unauthorized seller .

ECJ Case 102/77 Hoffmann-la Roche & Co. AG, Judgment of  23 May 1978, LawLex200400002972JBJ.

ECJ Case C-349/95 Loendersloot Internationale Expeditie, Judgment of 11 November 1997, LawLex200500005103JBJ.

Cass. com. 24 May 2011, LawLex201100000950JBJ: in this case, the products were put on sale in a sale shop, in a general public commercial area, among numerous objects offered in bulk, sometimes still in their transport box; Cass. com. 24 May 2011, 10-20.620, LawLex201100000952JBJ, ruling on the subject of products sold in a sale shop located in a sheet metal building, presented in plastic baskets near household products and knick-knacks of all kinds; Cass. com., 4 October 2011, LawLex201100001574JBJ.

Cass. com. 2 February 2010, LawLex202200000852JBJ; Cass. com. 9 October 2012, LawLex201200002165JBJ

Cass. crim. 16 June 1993, LawLex200200006011JBJ; Cass. com, 23 March  2010, LawLex2010000375JBJ; CA Paris, 22 October 1991, LawLex200001782JBJ.

115. Exception