Trade Mark Litigation

Lenz & Staehelin Thierry Calame and Jürg Simon

1. Sources of Law

1.1 What are the principal sources of law and regulation relating to trade marks and trade mark litigation? (Briefly describe the role of international, federal or state laws and relevance of court decisions, list and briefly describe relevant statutes and international treaties).

National law
The principal source of national law relating to trade marks is the Swiss Trade Mark Act. Subsidiary provisions concerning the registry and the registration procedure are set out in the Trade Mark Ordinance. The procedural law relating to trade mark litigation is set out in the Federal Act of Private International Law and the cantonal codes of civil procedure. Switzerland consists of 26 sovereign cantons all of which have their own code of civil procedure.

International Treaties
Switzerland is party to a number of international treaties in relation to trade marks, including the Paris Convention, the TRIPs Agreement, the Madrid Agreement and the Madrid Protocol, the Trade Mark Law Treaty (TLT), the Nice Agreement concerning the International Classification of Goods and Services, and the Vienna Agreement Establishing an International Classification of the Figurative Elements of Marks. Switzerland is also a party to the Lugano Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial matters which is significant with regard to jurisdictional and other procedural issues.

Court decisions
Switzerland does not adhere to the concept of binding precedence of court decisions, as is more fully explained in 2.3 below.

1.2 What is the order of priority of the relevant sources, ie which take precedence in the event of a conflict?

International treaties which Switzerland has adopted and are binding on it acquire immediate national validity. There is no need, therefore, to enact special laws to transform them into national legislation (although international agreements are generally ratified only after adapting Swiss national legislation, if and when this is necessary).
In the event of a conflict between international and national laws, it is generally recognised that international law takes precedence over national law. In previous rulings the Federal Supreme Court has considered that binding provisions in federal law that are contrary to international law prevail if the legislator knowingly adopted such provisions that contradict international law. In a new ruling, however, the Federal Supreme Court seems to admit the unrestricted validity of the principle that international law takes precedence over national law.
Although international treaties do not require any special steps for their transformation into Swiss national law, they are often not directly applicable, but rather aimed at the legislator. Provisions of international law are only directly applicable in Switzerland if they are formulated clearly and unconditionally enough to have a direct bearing and to be applied in a specific case or to constitute the basis on which a decision can be made. To the extent international law is transformed into Swiss national law such national law must be construed so as to comply with the relevant international law.
At national level, the Trade Mark Act is the principal statute and the Trade Mark Ordinance is subsidiary legislation. In the event of a conflict, the Trade Mark Act, therefore, prevails.

2. Court and Administrative System

2.1 Can third parties oppose/request cancellation of a national or supranational (eg Madrid Agreement and Protocol, Community Trade Marks) trade mark application/registration in your country? If so, on what grounds? Please briefly describe the opposition/ cancellation procedure(s).

Opposition
The owner of a prior trade mark or trade mark application may oppose a national trade mark registration or the Swiss extension of an international trade mark registration (IR) by filing a (post-grant) opposition with the Swiss Federal Institute for Intellectual Property. The opposition must be filed within a period of three months following publication of the registration of the trade mark. The opposition may only be based on relative grounds of refusal, but not on absolute grounds of refusal or prior rights other than prior trade mark rights (eg copyrights, contractual rights or rights arising from unfair competition law).
The opposition must be filed through a written document setting forth the opponent, his prior trade mark rights and the opposed registration. It must also contain the opponent’s submissions on why the registration should be rejected and payment of the opposition fee of CHF 800 per trade mark. The opposition is notified to the owner of the opposed trade mark registration, who is then afforded a period of time to submit a response. This response must contain the trade mark owner’s submissions on why the opposition should be rejected. There is usually only one exchange of briefs. If the opponent raises the defence of non-use of the prior trade mark in his response the owner of the prior trade mark will be able to provide evidence in a further exchange of briefs that the trade mark on which the opposition is based is not at risk of being revoked for lack of use. The opposition examiner then issues a decision which may be appealed to the Federal Administrative Court.

Cancellation action
After expiry of the opposition period or dismissal of the opposition, a cancellation action may be brought in court to request cancellation of the trade mark.
Any person who has a legitimate interest may request cancellation of a trade mark on the basis of absolute grounds of invalidity (see 3.5 below). Owners of prior trade mark rights may request cancellation of a trade mark on the basis of relative grounds of invalidity.
Since a cancellation action is filed before a court, cancellation proceedings follow the same format as trade mark infringement proceedings, as more fully explained in 6.1 below. In fact, trade mark cancellation actions are frequently raised by way of counterclaim in trade mark infringement proceedings.

2.2 In which courts are trade marks enforced? Are they specialised trade marks courts? If not, what level of expertise can a trade mark holder expect from the courts?

Trade mark proceedings are not assigned to any specialist federal court in Switzerland. Switzerland consists of 26 sovereign cantons all of which have set down their own court systems and their own codes of civil procedure (there is currently a bill under discussion in Switzerland to create a unified system of civil procedure, but not court system). Each canton has one specific court in charge of hearing trade mark cases. Those cantonal courts are not specialist trade mark courts, but hear trade mark cases among many other cases. In the larger cantons, especially in those that have commercial courts (ie Zurich, St Gall, Argovie and Berne), the courts hear several trade mark cases a year. A trade mark owner can, therefore, expect a significant level of expertise from these courts. However, in many cantons trade mark cases are not frequently heard. The courts will have a lower level of expertise in these cantons.
Forum shopping is generally possible, except where a foreign plaintiff sues a Swiss defendant for trade mark infringement. In this case, the plaintiff will usually have to sue the defendant in his domicile.

2.3 To what extent are courts willing to consider, or are bound by, the opinions of other national or foreign courts that have handed down decisions in similar cases?

The courts are in principle not bound by the opinions and decisions of other national courts that have dealt with similar cases. The cantonal courts are not even bound by the opinions of the Federal Supreme Court – except when a decision of a cantonal court has been remanded by the Federal Supreme Court, in which case the cantonal court in handing down a new decision is bound by the opinion of the Federal Supreme Court. It is, however, unlikely that a cantonal court will decide a case differently if the Federal Supreme Court has already dealt with a similar case. In practice, the opinions of the Federal Supreme Court are, therefore, generally binding for lower instance courts.
Swiss courts are, as a general rule, willing to consider the reasoning given by foreign courts that have handed down decisions in similar cases – especially with regard to courts from neighbouring countries, in particular Germany. Although decisions of foreign courts are technically not binding for Swiss courts, they are generally taken into account as an important additional source of inspiration.

2.4 Do the courts deal with infringement and invalidity simultaneously? Or must invalidity actions be brought in separate proceedings? If so, before which court or national or supranational government agency shall they be brought (eg the national Trade Mark Office or the OHIM in Alicante)?

The cantonal courts may deal with infringement and invalidity simultaneously. The defendant to infringement proceedings may seek to challenge the validity of the trade mark by way of defence or by way of counterclaim. Typically, a court will first deal with invalidity and, where the trade mark is held to be valid, will then deal with infringement.

2.5 Who can represent parties before the courts handling trade mark litigation and/or the national or supranational government agency dealing with trade mark validity issues?

Only attorneys at law admitted to the bar can represent parties before the courts handling trade mark litigation. It is common and advisable to retain specialised attorneys at law for representation. Patent agents (usually known as patent attorneys in Switzerland) do not have rights of audience before the cantonal courts, but can represent parties in trade mark opposition proceedings before the Swiss Federal Institute for Intellectual Property.

2.6 What is the language of the proceedings? Is there a choice of language?

German, French and Italian are official languages in Switzerland. In the German speaking part of Switzerland, the language of the proceedings is German, in the French speaking part it is French and in the Italian speaking part it is Italian. There is a (limited) choice of language only in the bilingual cantons of Berne, Fribourg, Valais and the trilingual canton of the Grisons.

3. Substantive Law

3.1 To what extent are unregistered trade marks protected under your country’s laws?

Swiss law protects unregistered trade marks to the extent that they are well known within the meaning of Article 6bis of the Paris Convention. Unregistered trade marks may further be protected under unfair competition law to the extent that they are either inherently distinctive or have acquired distinctiveness through use.

3.2 How is trade mark infringement assessed? Does protection extend to translations or to conceptually identical but graphically different trade marks?

As a general rule, the owner of a registered trade mark has the right to prevent third parties from using identical or similar signs for identical or similar products or services. Trade mark infringement arises where the signs are similar – and not only identical – to the registered trade mark and used for identical or similar products or services, provided a likelihood of confusion results from it. No likelihood of confusion is required for identical signs used for identical products or services.
The scope of protection of a trade mark depends on the degree of its distinctiveness. As a general rule, the more distinctive a trade mark is the broader is its scope of protection. In determining likelihood of confusion the requirements of similarity of signs and similarity of goods and services interact with each other. The more similar the signs are, the lower is the required similarity of goods and services for the purpose of establishing likelihood of confusion and vice versa.
Similarity of signs depends on the overall impression evoked in the mind of the average consumer. The mark as registered – and not its differing use – is relevant for the purpose of assessing similarity of signs. Similarity of signs is judged on the basis of appearance, sound and meaning, whereby already one of these factors may be determinative under Swiss law. Similar meaning of two signs will generally be sufficient for the purpose of establishing likelihood of confusion, and protection will, therefore, extend to translations if the average consumer is capable of understanding the meaning of the term in the foreign language. The inadmissibility of translations into foreign languages is specifically recognised for well-known trade marks in Article 6bis Paris Convention.
Swiss trade mark law only protects the particular expression of a graphic sign, but not the underlying motif. As a result, protection will generally not extend to conceptually identical but graphically different trade marks, unless the graphical differences are minor.

3.3 Are there other causes of action for trade marks (eg dilution)?

The owner of a famous trade mark may prevent third parties from using similar or identical signs for all goods and services if such use is detrimental to the distinctiveness of the famous trade mark, takes undue advantage of or otherwise affects the reputation of such mark. Weakening the distinctiveness of a famous trade mark, usually as a result of the use of similar trade marks, is commonly referred to as dilution.

3.4 Can a trade mark be enforced against a domain name, a trade name, a pseudonym or other distinctive signs?

A trade mark owner can enforce his trade mark against a domain name, a trade name or any other distinctive signs where such signs are confusingly similar to the owner’s trade mark and where they are used as trade marks (and not eg as a trade name or in a descriptive or decorative manner).

3.5 On what grounds can a trade mark be invalidated?

Under the Trade Mark Act, the Court may invalidate a trade mark on the following grounds:

• absolute grounds of invalidity;
  – signs that lack distinctiveness;
  – shapes that constitute the nature of the goods themselves or shapes of the goods or of their packaging that are technically necessary;
  – misleading signs;
  – signs contrary to public order, morality or applicable law; or

• relative grounds of invalidity (likelihood of confusion with an earlier trade mark).
• non-use for more than five years after registration (as more fully explained in 3.6 below).

3.6 Must use requirements be satisfied to maintain the trade mark registration? If so, is there any definition of what constitutes use?

Trade marks that are not used are not cancelled ex officio. However, any third party may request the cancellation of a trade mark that the owner has, without good reason, not used for the designation of goods or services in respect of which it is registered within an uninterrupted period of five years following expiry of the opposition period or termination of opposition proceedings, respectively.
If the owner starts using the trade mark or resumes its use after expiration of the five year period, his rights in the trade mark will be restored with effect from the original priority date, unless non-use of the trade mark has been invoked by a third party prior to the time of first or resumed use.
There is no exact definition of what constitutes use, but some general principles emerge. The mark must have been used as a trade mark (and not eg as a trade name or in a merely descriptive or decorative manner). The use must be sufficiently serious, ie token use is not sufficient. The assessment is conducted on a case-by-case basis. The mark is considered to be used if it is used by a third party with the consent of the owner. It is also considered to be used if the sign used is slightly different from the registered mark. Generally, only use in Switzerland will suffice. However, due to a bilateral treaty between Germany and Switzerland, Swiss trade mark owners may rely on trade mark use in Germany for the purpose of fulfilling the use requirement in Switzerland if the trade mark is protected in both countries.
The trade mark is revoked only for the products and services for which use has not been proven. The owner may avoid revocation if he proves that he had good reason not to use the mark.

3.7 What other defences, if any, are available to an alleged infringer? Does your country’s law provide for a prior user rights?

The alleged infringer may argue that there is no likelihood of confusion between the two marks if properly judged. The alleged infringer may also challenge the validity of the trade mark.
Alternatively, the defendant may argue that the alleged infringing acts are exempted from trade mark infringement. Under Swiss law, the rights conferred by a trade mark do not extend to uses for descriptive or decorative purposes. In addition, the alleged infringer may argue exhaustion of rights if the marked product has been sold anywhere in the world by the trade mark holder or with the trade mark holder’s consent (Switzerland adheres to the principle of international exhaustion in trade mark law).
The alleged infringer may further argue that he is entitled to a prior user right. Under Swiss trade mark law, the owner of a trade mark may not prohibit another person from continuing to use a sign that such person had already used before the filing of the application.
Finally, the alleged infringer may argue that the trade mark holder is estopped from enforcing an otherwise valid and infringed trade mark due to lapse of substantial time. This defence is, however, limited to rare cases where the trade mark holder by his conduct has given the alleged infringer reasonable grounds to believe that he would not bring any claims for trade mark infringement. Mere inactivity of the trade mark holder even for a long time is generally not sufficient.

3.8 To what extent can enforcement of a trade mark expose the trade mark holder to liability for an antitrust violation?

Under Swiss law, the enforcement of a trade mark may not be considered as violating competition law for the mere reason that the trade mark owner enjoys a monopoly. However, competition law may prohibit certain types of trade mark right enforcement which may amount to an abuse of a dominant position. This may apply in the case of trade mark coexistence agreements or selective distribution agreements.

3.9 Can a court only partially invalidate a trade mark?

A trade mark registration can also be partially invalidated by a court, in which case the decision will provide for a limitation of the list of goods and services covered by the registration.

3.10 Is it possible to amend a registered trade mark during a lawsuit?

As a general rule, it is not possible to amend a registered trade mark after filing. The owner of a trade mark may neither modify the mark nor add new products or services during a lawsuit. However, the trade mark owner may relinquish products or services during a lawsuit. Such relinquishment shall be notified to the Swiss Federal Institute for Intellectual Property and shall take effect on the day of its publication.

3.11 Are there any grounds on which an otherwise valid trade mark can be deemed unenforceable, owing to misconduct by the trade mark holder, or for some other reason (eg expiry of time limit)?

A trade mark cannot be deemed unenforceable owing to reasons of misconduct of the trade mark holder. An otherwise valid and infringed trade mark can be deemed unenforceable owing to lapse of time only under exceptional circumstances, as more fully explained in 3.7 above.

3.12 Can a trade mark holder bring a lawsuit claiming both trade mark infringement and unfair competition for the same set of facts? Is it possible to bring parallel unfair competition proceedings, whether or not the trade mark is registered?

In principle, a trade mark holder can bring a lawsuit claiming both trade mark infringement and unfair competition for the same set of facts. Some courts have considered the mere trade mark infringement to already constitute an act of unfair competition. However, it may also be that additional activities of the alleged infringer – separate from mere trade mark infringing activities (such as using a confusingly similar trade dress) – constitute acts of unfair competition, which may also be actionable in the same lawsuit.

4. Parties to Litigation

4.1 Who can sue for trade mark infringement (trade mark holder, exclusive licensee, non-exclusive licensee, distributor)? Does a licensee need to be registered to sue?

Under Swiss law, the trade mark holder and the exclusive licensee can sue for trade mark infringement. The exclusive licensee can only sue for trade mark infringement if the relevant licence agreement (expressly or implicitly) gives the exclusive licensee the right to sue for trade mark infringement. It is not necessary for exclusive licensees to register their licence rights in order to sue. A bill designed to revise the Trade Mark Act which has recently been adopted by Swiss parliament provides that the exclusive licensee can generally sue for trade mark infringement unless the licence agreement specifically excludes it.
Non-exclusive licensees or distributors have no right to sue for trade mark infringement. In the circumstances, it is important for those non-exclusive licensees and distributors to stipulate in the relevant licence or distributorship agreement that the trade mark holder should take action for trade mark infringement.

4.2 Under what conditions, if any, can an alleged infringer bring a lawsuit to obtain a declaratory judgment on non-infringement?

Under Swiss law, an alleged infringer may bring a lawsuit to obtain a declaratory judgment that an act does not, or a proposed act would not, constitute an infringement of a trade mark, provided that he has a legitimate interest to obtain such judgment. This is usually the case if the alleged infringer has received a cease and desist letter or the trade mark holder has otherwise asserted that he infringes the trade mark holder’s trade mark. If the trade mark holder has not yet given any indication that he considers the alleged infringer’s activities to constitute infringement, an alleged infringer is generally barred from bringing a lawsuit to obtain a declaratory judgment on non-infringement.

4.3 Who can be sued for trade mark infringement? Can the company directors be sued personally? Under what conditions, if any, can someone be sued for inducing or contributing to trade mark infringement by someone else?

Any person infringing a trade mark by himself, or through his agents, is potentially liable and may be made a defendant to proceedings.
Directors of a company would not normally be liable simply because their company has been engaged in infringing activities unless it can be shown that the directors have personally committed or directed the infringing acts or the company committed the infringements as their agent, or that they expressly authorised the same or that they were aware of the trade mark infringement and did not take steps to stop it. A company itself is liable for any acts committed by its directors and/or its employees in the course of their duties.
Any person inducing or contributing to a trade mark infringement is also potentially liable and may be made a defendant to proceedings.

4.4 Is it possible to add or subtract parties during litigation?

Under the applicable procedural law, it is generally no longer possible to add parties during litigation. A co-plaintiff may, however, withdraw any particular claim made by him, as against any or all of the defendants.

5. Enforcement Options

5.1 What options are open to a trade mark holder when seeking to enforce its rights in your country?

The trade mark holder may enforce its rights by threatening or taking legal action. Typically, the trade mark holder initially sends a cease and desist letter asserting the trade mark infringement and requiring the alleged infringer to immediately cease to infringe and desist from future infringements, to disclose information about the supplier and the turnover and profits generated with the infringing product, to pay compensation for damages suffered by the trade mark holder (including reasonable attorneys’ fees) and to destroy remaining stock of infringing products.
If the trade mark holder seeks to enforce its rights in case of non-compliance, he can bring a civil action seeking relief such as a permanent or – initially – a preliminary injunction, destruction of infringing goods, damages or accounts of profits. He can also instigate a criminal investigation seeking the criminal prosecution of the trade mark infringer or request that the customs authorities withhold infringing goods. However, he cannot recover financial loss in criminal or border measure proceedings.

5.2 Are criminal proceedings available? If so, what are the sanctions?

Acts of intentional trade mark infringement are criminal offences in Switzerland. The sanctions are either a fine of up to CHF100,000 or imprisonment up to one year.

5.3 Are border measures available?

Yes, the Trade Marks Act explicitly provides for border measures for trade marks. They are frequently used in practice.

5.4 To what extent are courts willing to grant cross-border or extra-territorial injunctions?

Swiss courts may in principle grant cross-border or extra-territorial injunctions (involving foreign counterparts of a Swiss trade mark) if they have jurisdiction over the cross-border dispute. It is generally recognised that this is only the case if the defendant to infringement proceedings is domiciled in Switzerland. In determining infringement of foreign counterparts the court has to apply the respective foreign law. In other words, in determining whether a French trade mark is infringed, the Swiss judge has to apply French trade mark law, etc. Judges will generally be reluctant to grant cross-border or extra-territorial injunctions. This is especially so in preliminary injunction proceedings.
If the defendant to infringement proceedings challenges the validity of the foreign trade marks by way of counterclaim, the judge will decline jurisdiction over the dispute since the invalidation of the foreign trade mark falls under the exclusive jurisdiction of the courts of the country in which the trade mark was issued. Even if the defendant to infringement proceedings challenges the validity of the foreign trade marks by way of defence, the judge will not deal with invalidity as a preliminary question to infringement, according to the recent GAT/LuK ruling of the ECJ. In the circumstances, the judge will, however, not decline jurisdiction, but rather stay the proceedings to enable the defendant to initiate cancellation proceedings in the country in which the foreign trade mark was issued. If the defendant does not initiate such cancellation proceedings, the court will ignore the invalidity defence and proceed with the infringement proceedings, according to a recent decision of the Commercial Court of the Canton of Zurich.

5.5 To what extent do courts recognise the blocking effect of ‘torpedo’ actions abroad?

As a general rule, a Swiss court must stay proceedings, if there are already proceedings pending between the parties on the same subject matter before a foreign court. Where the alleged infringer has filed a ‘torpedo’ action for a declaratory judgment of non-infringement in a slow moving jurisdiction and the trade mark holder (or exclusive licensee) commences infringement proceedings in Switzerland in respect of the same trade mark, the Swiss court will generally stay the Swiss proceedings. Some authors argue that if the foreign court in which the ‘torpedo’ was filed has clearly no jurisdiction, the action before the foreign court constitutes an abuse of law and does not justify a stay of the Swiss proceedings. There is, however, no case law on the issue.

5.6 To what extent are alternative dispute resolution (ADR) methods (such as arbitration or mediation) available to resolve trade mark disputes? How widespread are ADR methods and in which sectors? If arbitration is available to assess invalidity, will your Trade Mark Office recognise and execute an arbitral award declaring a trade mark invalid?

In principle, alternative dispute resolution (ADR) procedures, including mediation and arbitration, are available for determining disputes of trade mark infringement. In Switzerland, both trade mark infringement and invalidity disputes are considered arbitrable. However, ADR proceedings are rarely used in trade mark matters in Switzerland. In trade mark licence contracts, the parties can provide for disputes to be handled by arbitration, but this is unlikely to resolve trade mark infringement and validity issues.
An arbitral award declaring a trade mark invalid, will be recognised and enforced by the Swiss Federal Institute for Intellectual Property in the same manner as a judgment or order to the same effect.
In some cantons, procedural law provides for mandatory conciliation and/or mediation hearings either prior to and/or during court proceedings where the parties are encouraged to resolve their dispute by way of court-mediated settlement negotiations (as more fully explained in 6.1 below).

6. Procedure in Civil Courts

6.1 What is the format of trade mark infringement proceedings?

Each canton has its own code of civil procedure and, accordingly, its own format of trade mark proceedings. However, some general principles emerge: to initiate court proceedings, the plaintiff files a statement of claim indicating what remedies he seeks against the defendant, presenting the facts and setting out the legal arguments. In some cantons, procedural law provides for a mandatory conciliation hearing prior to initiating court proceedings. The defendant will then file a statement of defence and a counterclaim, if any, refuting the infringement claim and asserting invalidity.
In some cantons, procedural law provides for mandatory conciliation or mediation hearings after the first exchange of briefs where the parties are encouraged to resolve their dispute by way of court-mediated settlement negotiations. If the dispute cannot be resolved, the plaintiff will file the reply and defence to counterclaim, if any, followed by the rejoinder and reply to counterclaim to be filed by the defendant and, finally, the rejoinder to counterclaim to be filed by the plaintiff.
After the briefs have been exchanged, the judge will decide whether witnesses will be heard, whether a court expert will be appointed or other evidence taken. Oral hearings are used for hearing witnesses and/or instructing experts. Once the witnesses have been heard, the court appointed expert furnished his opinion, and other evidence been taken, the parties will make observations on the results of the evidence taking – either in writing or at a final oral hearing.
Usually within a few weeks after the final oral hearing, the court will issue the decision.

6.2 Are disputed issues decided by a judge or a jury?

All trade mark cases in Switzerland are tried and decided by judges alone and without a jury. There are usually three or five professional judges, depending on the applicable procedural law. The commercial courts of Zurich, St Gall, Argovie and Berne also have adjunct judges with commercial or technical background in addition to the professional judges. In preliminary injunction proceedings it is generally only the chief judge deciding as single judge.

6.3 To what extent are documents, affidavits, witnesses and/or (court-appointed or private) experts used? Is it possible to cross-examine witnesses?

Documents
Trade mark proceedings are largely based on written documents (including correspondence between the parties, trade mark certificates, documents supporting recognition or acquired distinctiveness, leaflets and brochures establishing infringement, among others).

Affidavits
Affidavits are not frequently used, but may sometimes be helpful in lieu of witnesses. Especially in preliminary injunction proceedings, the applicant sometimes files affidavit evidence in support of its application. It is not necessary (but sometimes advisable) for those persons who have made the affidavit to give evidence in the Court.

Witnesses
Witnesses are not frequently used in trade mark infringement or cancellation proceedings. It is generally not possible to cross-examine witnesses as practiced in the Anglo-American legal system. In most cantons, the witnesses are questioned by the chief judge, but the parties are allowed to ask additional questions either directly to the witnesses or to ask them to the judge who will in turn question the witnesses.

Private expert opinions
Opinions of private experts are sometimes used in support of specific allegations (relating, for instance, to survey evidence or damage calculation). If a court comes to the conclusion that expert advice is required or the parties have made such request, the court will normally appoint a court expert. Private expert opinions may still be important to the extent that they provide guidance to the court-appointed expert.

Court-appointed expert
In Switzerland, the Court will rarely appoint an expert to give evidence in trade mark proceedings. Court appointed experts may, however, play a significant role in relation to survey evidence.

6.4 To what extent is survey evidence used (eg to support acquired distinctiveness, likelihood of confusion)? What is its relevance in proceedings (eg party allegation, evidence)? Who decides which consumers are questioned in the survey (eg the court or court expert)? What level of cost should one expect to incur to carry out a survey? Are these costs recoverable from the losing party?

Survey evidence is increasingly used in Switzerland to support acquired distinctiveness (as well as recognition) of a trade mark. Survey evidence is, however, not accepted by the courts to support likelihood of confusion between two signs since likelihood of confusion is deemed to be a legal question rather than a factual question.
Technically speaking, survey evidence that has been prepared by a private expert and submitted in the proceedings by one of the parties will be considered a party allegation. However, the courts will generally appreciate survey evidence as appropriate evidence. It is sometimes advisable to offer the oral testimony of the private expert who conducted the survey.
Upon request of one of the parties the court may also appoint a court expert in relation to the survey evidence. If the parties have already submitted survey evidence, the court expert, as a general rule, will first review the survey evidence submitted by the parties and only proceed with a further survey if she finds the private survey evidence to be insufficient.
In case the survey evidence is prepared by one of the parties, this party together with the private expert will prepare the questionnaire and decide which consumers to question. If the survey is already conducted for the purpose of registering a trade mark on the basis of acquired distinctiveness, the questionnaire and the choice of interviewees is generally discussed with the Swiss Federal Institute for Intellectual Property. In the case of a court appointed expert, the court will generally not interfere with the work of the court expert, but rather let the court expert prepare the questionnaire and decide which consumers to question. The parties are entitled to comment on the questionnaire and the choice of consumers to be questioned. If the choice of relevant consumers is in dispute among the parties, the court will decide the question or may even issue a partial judgment in relation to the relevant consumers since this is considered a legal question rather than a factual question.
On average, a party should expect to incur between €10,000 and €30,000 to retain a private expert to conduct a survey in Switzerland and to prepare an expert report for submission in proceedings (the costs of the survey will substantially vary depending on whether it is an omnibus survey or not). These costs will be provisionally paid by the party retaining the private expert, but are normally recoverable from the losing party at the end of the proceedings. In the case of a court appointed expert costs of around €30,000 will be incurred. The parties will provisionally share these costs, but such share will be recoverable from the losing party at the end of the proceedings.

6.5 Is evidence obtained for criminal proceedings admissible in civil proceedings, and vice versa?

Evidence obtained for criminal proceedings is admissible in civil proceedings and vice versa.

6.6 To what extent is pre-trial discovery permitted? If it is permitted, how is discovery conducted? If it is not permitted, what other, if any, mechanisms are available for obtaining evidence from an adverse party or from third parties?

Pre-trial discovery is only permitted to a limited extent. A party may file a request for production of documents with the court if the following requirements are fulfilled: (1) the documents sought are specific (ie fishing expeditions are not permissible); (2) the documents sought are in the custody of the other party; and (3) the party seeking discovery can prove the likely existence of the documents as well as their relevance to the case.
In addition, if evidence is likely to be destroyed or abandoned a party may request a judge to order the provisional seizure of such evidence. The procedural requirements are, however, stringent, and the seized evidence is only made available to the party requesting the seizure once the pleadings in the initial stage of the proceedings are finished and only to the extent necessary. Typically, if a trade mark holder does not have sufficient knowledge of the facts of the case and is, therefore, not in a position to substantiate a trade mark infringement claim, a request for the provisional seizure of such infringing goods will be rejected.

6.7 What level of proof is required for establishing infringement or invalidity?

The Court must be convinced that the trade mark is infringed or invalid, as the case may be.

6.8 How long do trade mark infringement proceedings typically last? Is it possible to expedite this process?

The length of trade mark infringement proceedings depends on the complexity of the case and the number of defences raised. Trade mark infringement proceedings may generally be concluded in one to three years. Expediting the process is only possible to a limited extent because the court controls the conduct of the proceedings.

6.9 What options, if any, are available to a defendant seeking to delay the proceedings? Under what conditions, if any, can proceedings be stayed? How can a plaintiff counter delaying tactics of defendant?

If applicable, the defendant may try to delay the proceedings by requesting preliminary judgments regarding jurisdiction, forfeiture, etc. The defendant may also seek repeated extensions of time for compliance with court deadlines. In some cantons only two or three time extensions are permissible. In other cantons, extensions are repeatedly granted, until it becomes clear to the court that the defendant is simply engaging in delaying tactics.
The plaintiff can try to resist all such applications. This may, however, be difficult since the court controls the conduct of the proceedings.

7. Final Remedies

7.1 What remedies are available against a trade mark infringer (final injunction, delivery up or destruction of infringing goods, publication of the decision, recall-order, monetary remedies, etc)?

Under the Trade Mark Act, the trade mark holder may seek the following relief against a trade mark infringer:

• an injunction restraining the defendant from any act of such infringement;
• an order requiring the defendant to deliver up or destroy any infringing products;
• damages in respect of the infringement;
• an account of the profits derived by the defendant from the infringement; and
• a declaration that the trade mark is valid and has been infringed by the defendant (to the extent the trade mark holder can show a legitimate interest).

7.2 To the extent it is possible to obtain a final injunction against future infringement, is it effective against the infringer’s suppliers or consumers?

It is possible for the plaintiff to obtain a final injunction against the defendant, whether acting by itself, its directors, officers, employees, servants, agents, representatives, nominees or associates or related companies or subsidiaries, from infringing the trade mark in question.
Unless the infringer’s suppliers or consumers are parties to the proceedings, the court would not impose an injunction against them.

7.3 What monetary remedies are available against a trade mark infringer (reasonable royalty, lost profits, account of profits, or some other basis)? Are punitive damages available? If so, under what conditions?

Overview
Similar to common tort actions, monetary remedies in trade mark actions are assessed on the basis that the plaintiff should be placed in the position which he would have been if no infringement had occurred. The plaintiff may either request compensation (damages) for the pecuniary loss that it has suffered from the infringement or require the defendant to surrender the profits made as a result of the sale of the infringing products (account of profits). Where the plaintiff is entitled to damages, he may request either compensation of lost profits or a reasonable royalty rate. According to a recent decision of the Federal Supreme Court, damages are only available where the plaintiff has exploited or licensed his trade mark. This also applies where the plaintiff seeks damages on the basis of a reasonable royalty rate. If the plaintiff has not exploited or licensed his trade mark, only an account of the profits derived by the defendant or a reasonable royalty rate on the basis of unjust enrichment law are available. Where the plaintiff is entitled to damages or an account of profits, he must make an election. The Court will not, in respect of the same infringement, award both damages and an account of profits. Usually, the plaintiff will pursue both remedies in parallel as alternative claims and take one remedy over the other at the end on the basis of whichever yields the better result.
In addition to either seeking damages or account of profits plaintiff is also entitled to seek damages for ancillary losses arising from the infringement. Such ancillary losses may include expenses incurred prior to initiating the action (eg the cost of survey evidence to the extent these costs are not recoverable in trade mark infringement proceedings) or expenses directed at mitigating the impact of the infringement (eg advertising expenses directed at minimising confusion in the market place).

Lost profits
Lost profits are those profits the trade mark holder would have made absent the trade mark infringement. The lost-profit award relies on decreased sales, eroded prices or increased expenses of the marked goods as a result of the infringement.

Reasonable royalty
The calculation of damages may also be based on a reasonable licence fee the plaintiff would have received had the defendant entered into a licensing agreement with the plaintiff. If an established royalty rate exists (because the trade mark holder has widely applied it in numerous licensing agreements), this rate may be used as reference value. If no such established royalty rate exists, one needs to determine a hypothetical royalty rate that the trade mark holder/licensor and the infringer/licensee (both hypothetically willing) would have agreed upon (at the time infringement began) if both had been reasonably and voluntarily trying to reach an agreement.

Account of profits
Alternatively, the plaintiff is entitled to the profits generated by the defendant due to the infringement (rather than profits lost by the trade mark holder).

Punitive damages
Swiss law does not provide for punitive damages. The Federal Supreme Court has recently found that punitive damages are contrary to Swiss ordre public.

8. Preliminary Relief

8.1 Is preliminary relief available? If so, what preliminary measures are available (eg preliminary injunction) and under what conditions?

Preliminary relief is available in the form of a preliminary injunction. The requirements are as follows: (1) prima facie case of infringement and validity (the burden on proof in relation to invalidity lies on the defendant); and (2) irreparable harm. In some cantons, it is difficult to obtain preliminary relief in trade mark proceedings.

8.2 Is ex parte relief available where defendant is given no notice at all? If so, under what conditions?

In cases of urgency and where there is a strong prima facie case of infringement, an application can be made to the Court for ex parte injunction. The application is made without notice to the defendant. In practice, ex parte injunctions are not frequently granted. In cases where the ex parte application is granted, it requires confirmation in inter partes proceedings.

8.3 Is plaintiff entitled to ask for an order that defendant’s premises are searched and a description of the infringing goods (and the accounting relating thereto) is made in order to establish proof of infringement (saisie-contrefaçon)? If not, what other mechanisms, if any, are available for seizing and preserving evidence for trial?

There is generally no saisie-contrefaçon or other mechanism in Switzerland to establish proof of infringement. Under exceptional circumstances, some mechanisms are available for seizing and preserving evidence. For instance, if evidence is likely to be destroyed or abandoned a party may request a judge to order the provisional seizure of such evidence. The procedural requirements are, however, stringent, and the seized evidence is only made available to the party requesting the seizure once the pleadings are finished in the initial stage of the proceedings and only to the extent necessary. Typically, if a trade mark holder does not have sufficient knowledge of the facts of the case and is, therefore, not in a position to substantiate a trade mark infringement claim, a request for the provisional seizure of such infringing goods will be rejected.

8.4 Can the defendant put the validity of a trade mark at issue in preliminary injunction proceedings?

Yes, in preliminary injunction proceedings the defendant can put the validity of a trade mark in issue by way of defence. If the defendant can satisfy the Court that there is a serious question on the validity of the trade mark to the extent that there is no prima facie case of trade mark infringement, the defendant may be able to defeat the plaintiff’s application for preliminary injunction.

8.5 What is the format of preliminary injunction proceedings?

Each canton has its own format of preliminary injunction proceedings. However, some general principles emerge. To initiate court proceedings, the plaintiff files a request for a preliminary injunction against the defendant, presenting the facts and setting out the legal arguments. The defendant will then file a statement of defence refuting the infringement claim and irreparable harm and asserting invalidity as defence.
In some cantons, procedural law provides for oral hearings after the first exchange of briefs where the parties are given the opportunity to plead orally (reply and rejoinder). The court then presents a preliminary view of the case to encourage the parties to resolve their dispute by way of court-mediated settlement negotiations. If the dispute cannot be resolved, the court will then issue a decision.
Alternatively, there is no oral hearing and parties submit reply and rejoinder in writing. The court will then again issue a decision.

8.6 To what extent are documents, affidavits, witnesses, and/or (court-appointed or private) experts used in preliminary injunction proceedings?

Documents
Preliminary injunction proceedings are also largely based on written documents.

Affidavits
Affidavits are especially helpful in preliminary injunction proceedings in lieu of witnesses. The applicant sometimes files affidavit evidence in support of its application. In preliminary injunction proceedings it is generally not possible for those persons who have made the affidavit to give evidence in the Court.

Witnesses
Witnesses are generally not used in preliminary injunction proceedings. In many cantons, witnesses are not even permissible means of evidence in preliminary injunction proceedings.

Private expert opinions
Opinions of private experts are sometimes used in support of specific allegations (as more fully explained in 6.3 above). They are especially helpful in preliminary injunction proceedings because the judge would generally not appoint a court expert in preliminary injunction proceedings.

Court-appointed expert
In Switzerland, the Court would generally not appoint an expert to give evidence in preliminary injunction proceedings in trade mark matters.

8.7 What level of proof is required for establishing infringement or invalidity in preliminary injunction proceedings?

The plaintiff has the burden to prove that there is a prima facie case of infringement and irreparable harm. The plaintiff has the burden to prove that there is a prima facie case of invalidity.

8.8 How long do preliminary injunction proceedings typically last?

The length of preliminary injunction proceedings depends on the complexity of the circumstances. Such proceedings may generally be concluded in seven to 12 months.
8.9 Where a preliminary injunction is granted, is it necessary to start main proceedings to confirm the preliminary injunction?
Yes, within 30 days.

9. Appeal Procedure

9.1 What avenues of appeal are available for a defeated party in main proceedings or preliminary injunction proceedings? Under what conditions?

The defeated party in any main proceedings may file an appeal against the decision of the cantonal court to the Federal Supreme Court. In support of the appeal, the defeated party may assert (1) a violation of federal law (ie trade mark law); (2) a violation of procedural (cantonal) law; and (3) a wrong assessment of the facts. While the review of violations of trade mark law is unlimited, the review of violations of procedural law and in relation to the assessment of the facts is limited to arbitrariness. For arbitrary violations of procedural (cantonal) law and arbitrary assessment of the facts, the cantons of St Gall and Zurich provide for a separate appeal which has to be filed first with a special cantonal court of cassation. The Federal Supreme Court will stay appeal proceedings until the cantonal court of cassation has issued its decision.
In preliminary injunction proceedings only an appeal with a limited review is available; as a result, the review of legal questions in preliminary injunction proceedings is basically limited to arbitrary or manifestly wrong applications of the law. In the cantons of St Gall and Zurich the defeated party will first have to file a separate appeal with a special cantonal court of cassation.

9.2 How long do appeal proceedings typically last?

Depending on the nature of the appeal, and the availability of the Court, an appeal can take three to eight months.

10. Litigation Costs

10.1 What level of cost should one expect to incur to take a case through to a first instance decision, preliminary injunction proceedings and/or appeal proceedings?
There are generally two types of costs involved in trade mark litigation – court costs and attorneys fees. Court costs are dependent on the value of litigation. Attorney’s fees are generally charged on a time costing basis, but are adjusted to reflect other factors such as complexity of dispute and value of litigation.
On average, a party should expect to incur between €30,000 and €100,000 to take a case through to a first instance decision. The court awards attorneys’ fees to the prevailing party (recoverable from the losing party), but such awards generally do not fully cover the required level of costs (as more fully explained under 10.2). Court costs have to be paid by the losing party.

10.2 Are costs recoverable from the losing party?

Generally, the successful party may recover their legal costs and disbursements from the other party, which after assessment by the court, is usually about 60 per cent of the legal costs and all disbursements actually incurred by the successful party in the proceedings.
The Court may exceptionally award a part or all of the court costs against the winning party, if it has abused the court proceedings or in other ways contributed to the delay of the proceedings.

11. Forthcoming legislation

11.1 What are the important developing and emerging trends in your country’s trade mark law?

An emerging trend in Swiss trade mark law is to improve the protection for geographical indications, in particular the indication ‘Swiss made’.
A new court, the Federal Administrative Court, has been created in Switzerland as per 1 January 2007. This court acts as board of appeals in trade mark prosecution and trade mark opposition matters. The developing and emerging case law of the Federal Administrative Court should also have an impact on trade mark practice in civil courts, but it is too early to assess its effects.

11.2 To the extent it relates to trade mark enforcement, please outline any major trade mark legislation in the pipeline.

There are currently two bills under discussion in Switzerland which relate to trade mark enforcement. One of them seeks to create a unified code of civil procedure for all of Switzerland. Another bill which has recently been adopted by Swiss parliament will codify the exclusive licensee’s right to sue and put foreign trade mark holders on a par with Swiss trade mark holders in relation to forum shopping against Swiss infringers.

12. Useful references

12.1 Please identify any useful works of reference relating to trade mark law and trade mark litigation in your country including useful websites.

www.admin.ch (website of the Swiss government)
www.bger.ch (website of the Swiss Federal Supreme Court)
www.ige.ch (website of the Swiss Federal Institute for Intellectual Property)
www.wipo.org (website of the World Intellectual Property Organisation)
www.wto.org (website of the World Trade Organisation)
www.sic-online.ch (website of sic!, monthly Swiss intellectual property law review)
www.swissreg.ch (Swiss Trade Mark Database)
Marbach, Trade Mark Law, SIWR III, 1996 (in German)
David, Commentary on the Swiss Trade Mark Act, 2nd edition, 1999 (in German)
Willi, Commentary on the Swiss Trade Mark Act, 2002 (in German)
David, Enforcing Intellectual Property Rights, SIWR I/2, 2nd edition, 1998 (in German)
Works of reference from Germany (including Fezer, Commentary on the German Trade Mark Act, 4th edition, 2007; Ekey/Klippel/Bender, Commentary on the German Trade Mark Act, 2nd edition, 2007; Ingerl/Rohnke, Commentary on the German Trade Mark Act, 2nd edition, 2003; Ströbele/Klaka, Commentary on the German Trade Mark Act, 6th edition, 2000) are generally useful in Switzerland.