Being an exchange student from Denmark I figured it would be interesting to give everyone a glimpse into Danish trademark law by looking at a case. The case will provide some insight into how trademarks are delt with in Danish law. I also find the aftermath of this specific case particularly interesting, because it shows some business considerations which are also interesting to think about in a Canadian context.
Introduction to the case
In a case before the Danish Supreme Court a large family restaurant chain called Jensen’s Steakhouse (“JS”) brought an action against a smaller and more local restaurant chain called Jensen’s Fish Restaurant (“JFR”) for infringement of their alleged trademark to “Jensen’s”.
The first JS opened in 1984. Since then, it has expanded to 33 restaurants in Denmark and 15 more across Sweden, Norway, and Germany. “Jensen’s Steakhouse” is a registered trademark in Denmark and in the EU, however “Jensen’s” is not a registered trademark on its own.
The first JFR opened in 1992 and in the following decades a few more restaurants opened.
The main issues of the case can be summarised as follows:
- if JS owned the trademark “Jensen’s”, and
- if JFR was entitled to use the mark anyways, because the ultimate owner of the restaurant had the surname “Jensen”.
Analysis of the case
If Jensen’s Steakhouse owned the trademark
The word “Jensen” is a Danish surname used by hundreds of thousands of people in Denmark. This does not preclude that it can constitute a trademark, however, as per the Danish Trademark Act, the mark must be suitable for distinguishing the owner’s goods or services from those of a third party.
Without giving much reasoning the court found that the mark “Jensen’s”, when used as a mark for restaurant, does distinguish the goods and services from those of a third party – both on its own and when used with the descriptive word “Steakhouse”.
For a mark to be protected under the Danish Trademark Act, it either needs to be registered or used in Denmark. The use needs to be continuous and may not merely be local. As mentioned, the mark was not registered, thus it needed to be used.
JS had 33 restaurants in Denmark, had used a substantial amount of money on advertising, used the mark in reference to several items on their menu, and a survey concluded that many people thought of JS, when they saw the mark “Jensen’s”. On these grounds the court found that the mark was used in Denmark.
The ”use of own name”-exception
The Danish Trademark Act provides for an exception to the owner of the marks’ right to forbid any third party to use their mark when the third party uses his own name. JFR argued that its use of the mark “Jensen’s” did not infringe JS’ trademark, because JFR was owned by a company which was solely owned and founded by Jacob Jensen. However, the court did not find that the exception applied to the names of a company’s owners, managing employees etc. Thus, JFR could not rely on the exception.
The courts conclusion
Because the court found that JS owned the trademark and keeping in mind that both JS and JFR are in the restaurant business in addition to the fact that a lot of people thought of JS when they heard the word “Jensen’s”, it’s not hard to understand why the court came to the conclusion that JFR’s use of the mark – with or without the words “Fish Restaurant” – was likely to confuse the average consumer. On these grounds the court ordered JFR to stop using the mark and entitled JS to damages.
The aftermath of the case
While JS had a legitimate interest in stopping JFR from using their trademark, the media painted a story of a battle between David and Goliath. The action was viewed as this large company stepping on a smaller business – which had been in business for 20 years.
All this bad press gave JS a seriously negative standing in the court of public opinion and amounted to a lot of customers boy cutting them. This resulted to an estimated loss of 30 million Danish Kroner (approx. CAD $5.5 million). Because the loss was this huge, the board addressed it in their annual report from 2014. From these comments it appears that 25 % less guests visited in the week after the judgement, and in the following months the effect had slowly reduced, however, the number of guests were still lower than the number before the judgement. JS has since done several campaigns to gain back their guests, but they remain unsure as to when their revenue will be back to the level before the negative press.
The case clearly shows that the court of public opinion matters a lot in cases like this, and in hindsight JS even stated that they wished that they had approached it differently. Ultimately, it would be fair to say that JS bringing (and winning) the case cost them more money than having the small business use their mark, however, I can understand (and sympathise as to) why they felt the need to protect their trademark.
Communications Law