Sar & Partners Successful for Hungarian Hotel Chain Management Companies in Long-Lasting Trademark Dispute

Sar & Partners Successful for Hungarian Hotel Chain Management Companies in Long-Lasting Trademark Dispute

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Sar & Partners has advised Hungarian hotel chain management companies responsible for the Prestige, Continental, and Boutique Hotels Budapest****Superior in several trademark infringement proceedings in Hungary initiated by or against the fast fashion company, Industria de Diseno Textil S.A., holder of the international and European Union "ZARA" trademarks. The subject of these proceedings was the use of the logo by the hotel chain management companies in connection with services of four stars superior premium hotels.

According to Sar & Partners, "one of the most important steps in the series of cases," started eight years ago was a non-infringement proceeding in which Sar & Partners requested [that] the Budapest Metropolitan Court declare that its clients' use of a logo consisting of the z, r, and a letters and an eastern style ornament between the capital Z and r letter much bigger than the letters in connection with the hotels it represented -- "four stars superior premium hotels" -- did not infringe on the fast fashion "ZARA" trademark of Industria de Diseno Textil S.A. That first court did not decide on the case on the merit and instead declared that according to Hungarian legislation so-called non-infringement proceedings similar to those in patent law could not be initiated trademark disputes.

In the following two trademark infringement proceedings, both initiated by Industria de Diseno Textil S.A, the fast fashion company based its claim on Section 4(1)(c) of the Hungarian Trademark Act (Act XI of 1997 on the protection of trademarks and geographical indications); namely, on the good reputation of its "ZARA" trademark. Sar and Partners successfully represented the hotel service companies, as, in a final judgment just delivered in both proceedings by the Hungarian Court of Appeal "in both decisions the court declared that the general impression is dominated by the eastern style ornament in the new logo, therefore its ... use does not infringe the international 'ZARA' trademark having a good reputation."

According to Sar & Partners, "the court concluded that when a claim is based on Section 4(1)(c) of the Hungarian Trademark Act instead of Section 4(1)(b) (identity with or similarity to the earlier trade mark and the identity or similarity of the goods or services), the likelihood of association on the part of the consumers shall be taken into account dominantly and shall be assessed instead of likelihood of confusion. Since the court concluded that there is no such an appearance that the proprietor of the trademark having a good reputation would provide the defendant’s service, according to the Hungarian Court of Appeal the Spanish fashion company cannot challenge the use of the figurative mark in question."

“We are highly satisfied with the outcome of these trademark infringement cases against Zara. Our firm considers it a great success that the Court of Appeal has finally declared based on its overall impression and consumers opinion that the use of the Hotel chain’s logo in connection with four stars superior premium hotel services does not infringe the fast fashion 'ZARA'," said Sar & Partners Managing Partner Ildiko Komor Hennel.

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