In Turkish trademark law, generally a trademark cancellation
(invalidation) takes effect retrospectively, as if the trademark
was never registered at all. However, a right holder may claim
compensation for a party's use of a trademark prior to
cancellation, provided the right holder can establish that the
trademark was registered with the Turkish Patent Institute
("TPI") in bad faith.
The retrospective effect of trademark cancellations and the
"bad faith" exception
In Turkish trademark law, if a trademark is cancelled, the
cancellation takes effect retrospectively. This means that
cancelling a trademark results in it being removed from the
TPI's registry, as if it had never been in force (except where
the grounds for cancellation occurred after the application
The law says that even if a trademark is cancelled (with
retrospective effect), the prior owner's use of the registered
trademark before the cancellation will not constitute trademark
infringement. Therefore, the law protects the registration granted
by the TPI and the prior owner of the cancelled registration is not
required to pay compensation for using the trademark prior to
However, if the trademark was registered in bad faith, Turkish
law outlines an exception to this rule which allows claims for
compensation and damages to be made against the prior owner of the
cancelled registration. Therefore, where bad faith exists, the
retrospective effect of trademark cancellation does not prevent
claims for compensation and damages.
In practice, determining the existence of bad faith is a matter
of court interpretation
While Turkish law includes the bad-faith exception and the TPI
publishes procedural guidelines, in practice, determining the
existence of a cancelled trademark owner's bad faith is a
matter of interpretation for the courts and these courts are not
strictly bound to recognize and observe the TPI guidelines.
Recently, the Appeal Court accepted a compensation claim from
the actual right holder in an action which was asserted parallel to
defending a trademark cancellation action.
The Regal Raptor case
This important decision was rendered in a case where the actual
right holder of the trademark (a Chinese motorbike manufacturer)
sought cancellation of a trademark which was registered in Turkey
to one of the manufacturer's previous customer.
The Chinese manufacturer's former customer registered the
manufacturer's trademark in Turkey under its own name. The
former customer then brought an action in Turkey against the
Chinese manufacturer (the actual right holder). The former
customer's claim sought to prevent use of the trademark by the
Chinese manufacturer and its Turkish distributor. The former
customer also seized motorbikes at Turkish Customs which were
destined for the manufacturer's new Turkish distributor.
The manufacturer sought damages in a separate action alongside
the cancellation of the trademark. The First Instance Court
accepted the bad-faith of the former Turkish customer's
application. The basis of the Court's decision was that the
former Turkish customer previously had a commercial relationship
with the actual trademark owner and invoked its rights against the
actual right holder despite this knowledge.
The Appeal Court affirmed the First Instance Court's
decision. The Appeal Court cancelled the trademark registration and
awarded the manufacturer damages to cover the material losses
(freight, container fee, loss of sale orders from Turkey) as well
as the moral loss which the manufacturer suffered.
The threshold for courts to find "bad faith" is quite
Although Turkish law provides for claiming compensation from the
owner of a cancelled trademark, the courts are reluctant to accept
the existence of bad-faith and tend to protect the registration
granted by the TPI. The general idea with this practice is to
maintain confidence in registrations granted by the governmental
As the body of judicial decisions on this topic grows, the
ability of actual right holders to claim damages against bad faith
trademark owners will become clearer and better known. These
decisions will force trademark trolls or bad-faith applicants to
consider the risk of potentially having to pay compensation to the
actual right owner. This may lead the bad-faith applicants thinking
twice about misusing a trademark.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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