## Facts

- Bayerische Motorenwerke AG (BMW) owned trade mark rights in “BMW” for motor vehicles; BMW Nederland BV oversaw BMW’s authorized distribution network in the Netherlands.
- Ronald Karel Deenik operated an independent garage in the Netherlands that sold second-hand BMW vehicles and offered BMW repair and maintenance services, but was not part of BMW’s authorized network.
- Deenik advertised that he specialized in BMW vehicles and provided BMW-related sales, repair, and maintenance services.
- BMW and BMW Nederland sued in Dutch court seeking an injunction and damages, alleging trade mark infringement based on Deenik’s advertising use of “BMW.”
- After mixed outcomes in the Dutch courts, the Dutch Supreme Court referred questions to the Court of Justice of the European Union (CJEU) concerning the interpretation of Articles 5–7 of First Trade Marks Directive 89/104/EEC, including exhaustion and permissible third-party advertising.

## Issues

1. Whether national transitional rules may apply pre-implementation national law to an appeal decided after the Directive’s implementation date, subject to consistent interpretation.
2. Whether an independent garage’s advertising that it repairs, maintains, or specializes in goods covered by a trade mark constitutes “use” of the mark under Article 5(1)(a).
3. Whether, for goods placed on the EEA market by the proprietor or with its consent, the proprietor may rely on Articles 5–7 to prohibit third-party advertising that truthfully informs consumers of second-hand sales and repair/maintenance services.
4. Under what conditions the proprietor may prohibit such use where the advertising risks implying an authorized relationship, affiliation, or other commercial connection.

## Decision

- The CJEU held that national transitional rules may provide that appeals from pre-implementation decisions are governed by prior national law, so long as national courts interpret national law as far as possible consistently with EU law.
- The CJEU held that using a trade mark in advertising to inform the public that an undertaking repairs and maintains goods covered by the mark, or specializes in such goods, is “use” within Article 5(1)(a).
- The CJEU held that Articles 5–7 do not generally entitle the proprietor to prohibit such advertising for goods put on the EEA market by the proprietor or with its consent.
- The proprietor may prohibit the advertising use only where the manner of use is liable to create the impression of a commercial connection, particularly that the advertiser is affiliated with the proprietor’s distribution network or has a special relationship with the proprietor.

## Legal Principles

- “Use” of a trade mark in the course of trade includes third-party informational advertising identifying repair/maintenance services or specialization related to branded goods.
- Exhaustion limits the proprietor’s control over further commercialization and related truthful advertising for goods placed on the EEA market by the proprietor or with its consent.
- A trade mark proprietor may restrict third-party use where the presentation of the mark is likely to mislead consumers into believing the third party is an authorized dealer/service partner or otherwise commercially linked to the proprietor.
- Truthful statements that an independent business sells second-hand branded goods or repairs/maintains such goods are generally permissible if they do not imply endorsement, authorization, or affiliation.

## Conclusion

The CJEU held that independent traders may use a trade mark to truthfully advertise the sale of second-hand genuine goods and the repair or maintenance of such goods, but the trade mark proprietor can prohibit the use when the advertising is presented in a way that is likely to suggest an authorized relationship or other commercial connection with the proprietor.


Bayerische Motorenwerke AG (BMW) & BMW Nederland BV v. Deenik, Case C-63/97 (C.J.E.U. 1999)