Vodka and the likelihood of confusion

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The Russian company FKP Sojuzplodoimport and the Dutch company Spirits International have been in dispute for several years regarding the ownership of the vodka trade marks STOLICHNAYA and MOSKOVSKAYA. The Russian company prevailed in proceedings in the Netherlands culminating in an order by the Rotterdam District Court ordering Spirits to transfer its rights in the trade marks to FKP and prohibiting Spirits from infringing the two marks.

In separate proceedings, the Rotterdam District Court refused FKP’s request to invalidate trade mark registrations owned by Spirits in respect of the word and figurative mark STOLI on the basis that there was no likelihood of confusion between those marks and the STOLICHNAYA marks.

The latest dispute between the pair concerned an alleged trade mark infringement by Spirits by reason of its use of the mark STOLI for vodka in the Benelux countries. Spirits stopped selling the Stolichnaya-branded vodka following the ruling of the Rotterdam District Court but began selling vodka in the Benelux countries under the STOLI mark using the logo “Same Vodka. Different Label”. FKP applied for an injunction.

Responding to the application, Spirits argued that:

  • the Rotterdam District Court had already ruled that the STOLI and STOLICHNAYA marks were not confusingly similar
  • in the assessment of confusion only the words STOLI and STOLICHNAYA should be taken into account as other elements, like the use of the words “premium” and “vodka”, were common practice
  • it carried out no acts in the Benelux countries that were reserved for the mark’s proprietor – the vodka was imported directly from Latvia by Spirit’s Benelux distributors.

The District Court found that the marks were confusingly similar. It considered that the relevant public could think that the STOLI mark was a restyle of the STOLICHNAYA label. In addition, FKP had submitted evidence of actual confusion. The Rotterdam District Court had considered other trade marks, not the STOLI mark in issue in this case, and therefore the submission based on the ruling of the Rotterdam Court was irrelevant.

However, given the absence of relevant acts by Spirits in the Benelux, the Court concluded that Spirits had not infringed the STOLICHNAYA mark. The existence of an agreement between Spirits and the distributors allowing it to place Stoli-branded bottles on the Benelux market did not, of itself, constitute an act of infringement. Spirits had, however, facilitated trade mark infringement by its Benelux distributors. The Court emphasised that it was important in this regard that Spirits was the trade mark owner and was aware that infringement when the STOLI mark was used by its distributors.

The finding was not affected by the goodwill that Spirits may have built up during the years in which it was the registered owner of the STOLICHNAYA mark. The Court therefore granted the injunction.