Trade name protection in The Netherlands: how does it work?

A company who uses a certain trade name to do business, needs some sort of protection that others, competitors maybe, are not allowed to use that same name. Trade name law protects the company in this case. But whether the use of a certain trade name is in breach of trade name rights of another party, depends on circumstances. Dutch intellectual property lawyer Hidde Reitsma explains.

Dutch case law: competitor uses same name

In a recent case the Dutch court had to assess whether a company had breached the trade name rights of a competitor by using the same name. The plaintiff in this case, offers IT-training and uses therefore the name “Spruit ICT”. Then one day it discovers that a competitor also started to use the name “Spruitt”, albeit this was spelled a little bit differently. After involvement of an IP-law solicitor the competitor ceased to use the name “Spruitt”. But the website spruitt.nl and the e-mail address @spruitt.nl remained in use. Visitors of the website were redirected to the competitors new website however.

Taking enforcement measures in The Netherlands

The plaintiff started a lawsuit and requested the court a declaratory decision that the competitor infringed trade name law. Further the plaintiff demanded the court to order the competitor to cease the infringement as well as to pay damages. The court assessed whether trade name law in fact protected the plaintiff to begin with. This was the case as the plaintiff had effectively used the trade name “Spruit” for his business and was also known by this name. As he used the name before the competitor did, the plaintiff was granted protection.

Risk of confusion of the public

The next question was whether the competitor had infringed trade name law. It is important to mention that not every use of the same or a similar trade name is unlawful. There must be a risk of confusion of the (relevant) public. This is the case if it is likely that the public (and potential clients) will think both companies are the same or in some way linked to each other. For example, a pet shop will not likely to suffer from an accountants office in another town with a similar name.

Dutch lawyer for trade name law

The court decided that because the names were almost identical and both companies provided IT-training for the same target group, there is (or has been) a risk of confusion of the public. Even though the competitor changed its name already, it is still using a domain name and e-mail address with the name Spruitt. The court considered this to be an ongoing infringement of trade name law and has ordered the competitor to cease this use at once. Furthermore the court held the competitor liable for any damages the plaintiff might have suffered during the period of infringement. What these damages are exactly will have to be established in a separate procedure. But the competitor will at least has to fully compensate the plaintiff its legal costs for this IP-law case.