If a trademark proprietor has brought his goods bearing the trademark on the market of the EU or in the European Economic Area (EEA) he cannot enforce the rights conferred by the trademark regarding those goods anymore. This also applies if the goods have not been placed on the market by the trademark proprietor himself but with his consent, e. g. by a licensee. In those cases the rights conferred by the trademark are exhausted.
In practice the exhaustion frequently raises difficult proof issues. Often, neither the trademark proprietor nor the merchant being prosecuted can – or want to – disclose details of the exact sales channel of goods at issue. Generally, German courts consider the merchant to have the burden of proof. However, the free movement of goods (Art. 34, 36 TFEU) granted by EU law can require exceptions from this principle, namely, in cases where the general burden of proof rule would enable the trademark proprietor to partition the national markets and to assist the maintenance of price differences between the member states (ECJ, judgement of 8/4/2003 – C-244/00 – Van Doren + Q).
According to the judgement of the BGH “CONVERSE I” this exception of the general burden of proof rule has to be understood in a narrow manner (judgement of 15/2/2012 – I ZR 52/10). In the case at hand the trademark proprietor being located in the USA has sold his casual shoes by different exclusive distributors for the various EU countries. At least some of them were not prohibited from selling the shoes to wholesalers in other countries. One of the exclusive distributors, however, publicly announced that dumping prices would not be tolerated. The BGH accepted this as a proof that this exclusive distributor intervene against very low prices of his authorised dealers. But this did not lift the onus of proof from the defendant because it has not been clear that the disctributor’s course of action promoted price differences inside the EU. Thus, maintaining a uniformly high price level does shall not be the same as promoting price differences.
On the same day the BGH has decided the case “CONVERSE II” (I ZR 137/10) which is about original shoes originating from a trademark proprietor’s former EU-based licensee. The licensee sold the goods months after the ending of the license contract. The question in dispute has been whether he had bought those goods under the contract from the trademark proprietor. The BGH has not seen a need for shifting the burden or proof to the plaintiff in this constellation: Since the trademark proprietor could no longer put any pressure on the former licensee, there was no risk market partitioning. The BGH approved that the lower courts had not taken evidence as the defendant had failed to name a witness in proper form, so that the infringement was finally confirmed.
The BGH’s reluctance to shifting the burden of proof to trademark owners appears to be quite understandable. As opposed to a merchant confronted with an allegation of trademark infringement, the trademark proprietor has no access to information about the delivery chain of the contested goods which could answer the question of exhaustion. Nevertheless, some doubts remain in regard of the conclusions in the case “CONVERSE II”. The fact that the defendant could not prove that said licensee had bought the shoes from the trademark proprietor directly does not compel the conclusion of a lack of exhaustion. There had still been the possibility that another member of the trademark proprietor’s EU sales organisation had delivered the goods to said licensee. The BGH has possibly not considered this alternative because nothing in the defendant’s pleading had argued for it. This illustrates how largely the issue of onus of proof in exhaustion matters depends on the circumstances of the particular case.