Introduction

The reasoned decision of the Ankara Civil Court of Intellectual and Industrial Property Rights (“Ankara IP Court”) issued in a trademark cancellation action has been reversed twice by the Ankara Regional Court of Appeals (“Ankara Appeal Court”) on procedural grounds without an examination of the merits of the case.

The first decision of the Ankara Appeal Court concerns the violation of the Code of Civil Procedure No. 6100 (“CCP”) due to the inclusion of the visual of the disputed mark in the reasoned decision. The second decision concerns the contradiction with the Code of Execution and Bankruptcy No. 2004 (“CEB”) due to the violation of the rule that civil proceedings in which the bankrupt party is a plaintiff or defendant must be suspended and may only be continued 10 days after the second meeting of creditors.

The First Decision — Violation of the CCP

Following the refusal of its opposition and appeal by the Turkish Patent and Trademark Office (“TPTO”) Re-Examination and Evaluation Board (“Board”), the plaintiff filed a cancellation action before the Ankara IP Court in December 2016 requesting the cancellation of the Board's decision and the invalidation of the disputed mark against the owner of the disputed mark and the TPTO as co-defendants.

The disputed mark has been recorded as a figurative mark, but, in fact, it is a stylized version of some letters, which is identical to the plaintiff's well-known trademark series. The name of the disputed mark is indicated as a “figure” before the TPTO's records by the owner

The expert report prepared by the court-appointed expert panel was in favor of the plaintiff. Following the conclusion of the judicial proceedings, the Ankara IP Court accepted the plaintiff's requests and decided on the cancellation of the Board's decision, as well as the invalidation of the disputed mark. Since the disputed mark is a figurative mark, the Ankara IP Court included the trademark visual in its reasoned decision.

The TPTO then filed an appeal against the Ankara IP Court's reasoned decision before the Ankara Appeal Court.

In its first decision, the Ankara Appeal Court ruled that although the courts, if necessary, may include sketches and figures as annexes to the judgment, the inclusion of figures in the reasoning part of the judgment in a manner that is not in compliance with the provisions of Article 297 of the CCP1 and Article 141 of the Turkish Constitution2 may lead to lawsuits emerging from the lawsuit, causing further disputes between the parties and hesitation in execution. Incomplete inclusion of trademarks and designs in the reasoned decision, and the lack of color, size and other characteristics, may lead to misleading results.

Accordingly, the Ankara Appeal Court reversed the Ankara IP Court's decision on the ground that the inclusion of the visual of the disputed mark in the reasoned decision is not in compliance with Article 297 of the CCP by also referring to a number of rulings of the Supreme Court of Appeals. While the Ankara Appeal Court is entitled to conduct both legal and factual examination and issue a new decision altogether or correct the first instance court's decision, in this case, it sent the file back to the Ankara IP Court for retrial by indicating that there is no ruling that is suitable for legal and factual review.

The Second Decision — Violation of the CEB

Subsequently, the file was sent back to the Ankara IP Court and received a new merits number. In the meantime, the owner of the disputed mark went bankrupt and was undergoing liquidation. At the first hearing after the file was sent back, the Ankara IP Court decided to obtain information on the liquidation process and the finalization of the bankruptcy decision, as well as to suspend the proceedings until 10 days after the second meeting of creditors. The Ankara IP Court then adjourned the hearing for a few months.

However, in the second hearing, the Ankara IP Court once more accepted the lawsuit and issued a new reasoned decision, this time removing the visuals of the contested mark. In this second reasoned decision, the Ankara IP Court indicated that while it had previously decided on the suspension of the proceedings, it now renounced this earlier suspension decision and issued its ruling on the merits of the case without waiting for the second meeting of creditors, due to the intensity of the hearings and the serial files.

The TPTO once again filed an appeal against the Ankara IP Court's second reasoned decision before the Ankara Appeal Court.

In its second decision, the Ankara Appeal Court noted that it was understood from the file that the bankruptcy decision issued about the defendant has not been finalized, the second meeting of creditors has not yet been held and no date has been determined. In line with Article 194/1 of the CEB3 , the Ankara IP Court initially decided on the suspension of the proceedings. However, it was erroneous for the Ankara IP Court to issue a decision on the merits by ignoring the fact that no decision can be issued as long as the proceedings are suspended.

The Ankara Appeal Court reversed the Ankara IP Court's decision for a second time due to the violation of the CEB and sent the file back to the Ankara IP Court for retrial. The file received another merits number and is currently pending before the Ankara IP Court.

Conclusion

The decisions of the Ankara Appeal Court show how crucial it is for the courts of first instance to strictly follow procedural rules and comply with these rules at every step of the proceedings. First, it is important that the courts of first instance not include the visuals of the disputed marks in their reasoned decisions, even if the disputed marks solely consist of figurative elements. Second, if one of the parties went bankrupt and is in the liquidation process, the court proceedings must be suspended in accordance with the CEB rules, even if the court's decision on the merits of the case would remain the same.

Non-compliance with the procedural rules also seriously affects the overall timeline for the final resolution of the disputes. The application date of the disputed mark is December 2014, and the dispute over the trademark is still active and pending for almost a decade. That the cancellation action has been pending for almost seven years, the Ankara Appeal Court has not yet reviewed the merits of the case and there is a further appeal stage before the Supreme Court of Appeals are all strong indications of the excessive length of (IP-related) court proceedings in Türkiye.

A last point that the rights owners should pay attention to is that the cancellation actions filed against the TPTO Board's decisions are filed against both the TPTO and the owner(s) of the disputed mark(s) as co-defendants. Since the TPTO is an administrative authority and a part of the court action, as a result of which it can also bear the financial burden of an unfavorable decision, the TPTO almost always files further appeals before the Regional Court of Appeals and the Supreme Court of Appeals against unfavorable first instance court decisions, irrespective of the chances of success on merits.

On the other hand, invalidation actions are only filed against the owner(s) of the disputed mark(s), and the owner(s) may — depending on the circumstances — decide not to pursue the file before the appeal courts. This should be considered when evaluating the advantages and disadvantages of filing a cancellation action against the Board's decision or directly proceeding with an invalidation action since the two different appeal procedures considerably prolong the finalization of the first instance court decision.

Footnotes

1. Article 297 of the CCP - “Scope of the Judgment” (1) The judgment shall be delivered “in the name of the Turkish Nation” and shall include the following after this phrase: a) The names and surnames and registration numbers of the court, the judge or judges and the clerk of the court who issued the judgment, and if the court acts in various capacities, the capacity in which the judgment was issued. b) The identities of the parties and the participants in the case, their Turkish Republic identification numbers, the names, surnames and addresses of their legal representatives and attorneys, if any. c) Summary of the claims and defenses of the parties, the issues they agree and disagree on, the evidence collected on the disputed facts, the discussion and evaluation of the evidence, the facts established, and the conclusions and legal grounds derived therefrom. ç) The result of the judgment, the trial expenses and the refund of the unspent portion of the advance payment received from the parties, legal remedies and duration, if any. d) The date of the judgment and the signatures of the judge or judges and the clerk. e) The date of the reasoned decision.(2) In the concluding part of the judgment, without repeating any words belonging to the reasoning, the judgment rendered on each of the claims, the obligations imposed on the parties and the rights granted to the parties must be indicated explicitly, clearly and unambiguously under a sequence number.

2. Article 141 of the Turkish Constitution - “Publicity of hearings and the necessity of justification for verdicts” Court hearings shall be open to the public. It may be decided to conduct all or a part of a hearing in a closed session, but only in cases where absolutely necessitated by public morals or public security. Special provisions regarding the trial of minors shall be laid down in the law. The decisions of all courts shall be written with a justification. It is the duty of the judiciary to conclude trials as quickly as possible and at minimum cost

3. Article 194 of the CEB - “Adjournment of Civil Actions” Except in cases of urgency, civil actions in which the bankrupt party is a plaintiff or defendant shall be suspended and may only be continued 10 days after the second meeting of creditors. This provision shall not apply to lawsuits for damages arising out of infringement of honor and dignity, damages for bodily harm, disputes concerning marriage, personal affairs or alimony, and civil lawsuits filed in connection with proceedings by way of foreclosure of pledges. The statute of limitations and limitation periods do not run while the case is pending.

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.