At the end of last year,  the Italian Supreme Court (“Corte di Cassazione”) ruled in favour of Ferrari in a trademark infringement proceeding commenced by the renowned Italian car manufacturer against one of the unauthorized Ferrari owners' club, the Ferrari Club of Milan (“FCM”). FCM has been an authorized Ferrari Club From 1978 until 1986, when it terminated its cooperation with Ferrari. Since then, FCM kept on organizing events for its members by using and incorporating within its badge (which remained unregistered) Ferrari’s distinctive signs, namely the “prancing horse” and the elongated "F". In 1998 Ferrari started an ordinary infringement proceeding against FCM, in order to prevent any further unauthorized use of its figurative trademarks.

Both Courts of first and second instance in 2002 and 2006 rejected Ferrari’s claims on the ground that (i) Ferrari’s allegation was time-barred since the plaintiff acquiesced in the uses of its trademarks by FCM for a period of 12 years, and (ii) all the trademark uses by the association did not take place within a commercial activity, as FCM did not pursue any profit.

Ferrari then brought the case before the Italian Supreme Court, which overruled the appeal decision. First of all, the Italian Supreme Court stated that the principle of acquiescence could not apply in a conflict between an earlier registered trademark and a successive unregistered trademark. Therefore, Ferrari’s infringement action could not suffer any time restriction. With such statement, the Supreme Court has finally clarified that the principle of acquiescence cannot be extended by analogy, as suggested by some scholars.

Further, the Court gave its interpretation on the meaning of the term “in the course of trade” (mentioned in art. 9 of CTMR and in art. 20 of the Italian industrial property code) for infringement purposes. The Court clarified that the legal test for an activity to be considered performed “in the course of trade” is given by its “economic value”, irrespective of whether such activity is directed to the making of a profit.

To this end, the Italian Supreme Court’s decision recalled the ECJ decision Louis Vuitton v. Google, according to which “the use of a sign identical with a trade mark constitutes use in the course of trade where it occurs in the context of commercial activity with a view to economic advantage and not as a private matter”.

The Italian Supreme Court’s decision leveraged this ECJ decision to affirm that any service that is “destined to the market” shall not be regarded as private and thus cannot escape trademark infringement. 

It is now up to the Milan Court of Appeal to apply the above principles and finally decide the case.

Paolo Lazzarino is a partner at NCTM Studio Legale Associato