The procedural intersection of trade mark enforcement and validity challenges is defined by specific rules within the European Union. When a business faces an infringement lawsuit while simultaneously defending the stability of its registration, the timing of these filings becomes pivotal. A recent development before the Court of Justice of the European Union (CJEU) threatens to alter this balance, potentially complicating how companies protect intellectual property rights across Europe.
The Current Legal Framework
Under Article 132(1) of the EU Trade Mark Regulation (EUTMR), a court hearing an infringement action must stay those proceedings if an application for revocation or invalidity has been filed at the European Union Intellectual Property Office (EUIPO). This obligation remains unless there are "special grounds" for continuing the hearing. An equivalent rule exists for registered EU designs under Article 130(1) of the EU Design Regulation.
Historically, courts interpreted this provision to apply only when the cancellation application is filed before the infringement lawsuit begins. The logic was straightforward: if the validity challenge predates the enforcement action, the court should pause to allow the EUIPO to resolve the foundational question of whether the trade mark exists. However, the law has remained largely silent on what happens when the sequence is reversed - that is, when an infringement action is filed first, and only later does a third party attempt to cancel the trade mark.
The Bodegas Sanviver Case
This ambiguity is now under scrutiny in the case of Bodegas Sanviver (C-392/25). The referral stems from a conflict between the referring court in Alicante, Spain, and the Spanish Supreme Court (Tribunal Supremo). The Supreme Court annulled the lower court’s decision because it failed to stay proceedings after a cancellation application was filed post-lawsuit.
Advocate General Biondi recently delivered an opinion challenging this traditional view. He proposed that Article 132(1) should apply regardless of whether the EUIPO cancellation action was filed before or after the infringement action was initiated. In his interpretation, the word "already" in the regulation does not necessarily refer to the moment the lawsuit starts, but rather to the time at which the court is making its decision on whether to stay the case.
Implications for Business and Enforcement
If the CJEU accepts this broad interpretation, it could create significant hurdles for trade mark owners. A primary concern is that courts could be required to stay infringement proceedings at any stage simply because a third party filed a cancellation application with the EUIPO. This would effectively allow potential infringers or competitors to delay enforcement indefinitely by filing late-stage validity challenges.
This outcome raises several practical and legal concerns:
- Party Autonomy: The rule applies irrespective of who files the cancellation. Under the proposed interpretation, a court could stay proceedings on its own motion due to a third-party action, undermining the principle that parties should control the scope of their dispute.
- Procedural Consistency: Article 132(2) already addresses the reverse scenario, requiring the EUIPO to stay cancellation proceedings if a counterclaim is filed in court. Applying Advocate General Biondi’s logic consistently could mean that the EUIPO must stay its work whenever any infringement case is pending elsewhere in the EU, creating a disjointed enforcement landscape.
- Legal Uncertainty: The current regulation does not explicitly govern post-filing cancellations. Traditionally, this falls under national procedural rules, which typically grant courts discretion based on factors like the strength of the cancellation claim and the stage of the infringement case.
Strategic Considerations for Companies
For businesses relying on EU trade marks, the outcome of Bodegas Sanviver will define the robustness of their enforcement strategies. A ruling favoring mandatory stays in all scenarios would incentivize bad-faith cancellations as a tactical defense mechanism in infringement lawsuits. This would increase the cost and duration of litigation, potentially eroding the value of registered rights.
Conversely, maintaining the current understanding - where stay decisions depend on national procedural rules when cancellation follows infringement - allows courts to balance interests more effectively. Judges can assess whether a post-filing cancellation has genuine merit or is merely delaying tactics. This discretion is essential for preventing abuse while respecting the integrity of trade mark registrations.
Looking Ahead
The CJEU’s upcoming decision will set a precedent that reverberates across all EU member states. It will determine whether the stability of trade mark rights is prioritized over procedural efficiency, or if flexibility in enforcement remains available to protect legitimate business interests. Companies must monitor this development closely, as it may influence how they structure their IP portfolios and respond to litigation threats in the future.