Grüne Punkt loses appeal in logo-fixing claim

The Court of First Instance handed down its decision in Case T-151/01 Der Grüne Punkt-Duales System Deutschland GmbH v European Commission, supported by Vfw AG, Landbell AG and BellandVision GmbH on Thursday 24 May 2007.

The German government passed a law to reduce the impact of packaging waste on the environment. This law required manufacturers and distributors to take back and recover used sales packaging outside the public waste disposal system in one of two ways: (i) they could take back the used sales packaging free of charge at or near the point of sale and recover it ('self-management') or (ii) they could guarantee the regular collection of used sales packaging from the final consumer or in the vicinity of the final consumer (an 'exemption system').

Grüne Punkt was the only undertaking which operated a Germany-wide exemption system, although other undertakings did so regionally. By an agreement with contracting manufacturers and distributors it was provided that (i) those participating undertakings should affix Grüne Punkt's logo on all pieces of packaging that were notified as being capable of recovery under the system and intended for domestic consumption in Germany and (ii) a fee would be charged for all packaging bearing its logo. This fee, which served to cover the costs of collecting, sorting and recovering the packaging, was charged irrespective of whether the packaging was in fact recovered through Grüne Punkt's system, through some other exemption system or through a self-management solution.

The Commission ruled that Grüne Punkt had abused its dominant position in the market by requiring payment of a fee for the total quantity of packaging bearing its logo and put into circulation in Germany, even though there was evidence that other exemption systems or self-management solutions were used. In the Commission's opinion Grüne Punkt was exploiting its customers by (i) charging for services that were not provided and (ii) obstructing the entry on to the market of competitors, in the light of the costs related to the linked use of a system other than Grüne Punkt's. The Commission decision did not criticise the fact that Grüne Punkt's customers were required to affix its logo to each piece of packaging intended for domestic consumption, but it did object to the requirement of payment for the total quantity of packaging carrying that logo. In its view no fee could be required, despite the affixing of the Grüne Punkt logo, where the customer had shown it had fulfilled its obligations under domestic law through some other exemption system or self-management solution.

Above left: waste packaging in Europe - a major environmental issue

Grüne Punkt brought an action before the CFI to annul that decision, arguing that the decision was disproportionate in preventing it from levying a fee on each package bearing its logo. In any event, it claimed, the abuse could be remedied through the selective marking of packages to signify which exemption system or self-management solution they were intended for. The CFI dismissed the action. In its opinion

* the Commission's measures were not disproportionate. They only required Grüne Punkt not to charge a fee on the total amount of packaging marked with its logo where it was shown that some of that packaging had been taken back and recovered through another system.

* Competition between systems took place on the basis of the quantities of material to be recovered and not on the basis of predetermined quantities of packaging which fell exclusively, in particular by means of selective marking, within one or other of the systems used.

* The requirement that Grüne Punkt not charge a fee based on all packaging marked with its logo did not disproportionately impair its interests, since it was still remunerated for the service which it provided - the taking back and recovery of quantities of material entrusted to it by the manufacturers and distributors of packaging which participated in its system.

* Even if it were theoretically possible to affix the logo to packaging selectively, that solution was more expensive and difficult for manufacturers and distributors of packaging to implement than limiting Grüne Punkt's the remuneration to cover only the service actually provided by its system.

* For the Commission to accept the principle of selective marking would be akin to permitting Grüne Punkt to continue to abuse its dominant position: the costs related to selective marketing and the practical difficulties involved in its implementation were likely to dissuade Grüne Punkt customers from using any alternative system to take back and recover some or all of their packaging in Germany.

The IPKat is a little puzzled. He thought this decision must be pretty important as it deals with how traders may use their trade marks and also touches on trade mark uses that are anticompetitive. Yet it appears to have received so little attention so far. Visits to his regular web-haunts and news sources have however revealed nothing. Is he missing the point here, or is everyone else? Merpel says: I've formulated an alternative explanation. This decision was posted late and this happens to be a holiday week(end) in much of the civilised European world. Perhaps no-one has read it yet!

A second decision involving the same parties on the same day was Case T-289/01 Der Grüne Punkt-Duales System Deutschland GmbH v European Commission, also before the CFI. This case involved competition law issues only and not the exercise of Grüne Punkt's rights in its logo.

Right: waste disposal is an issue on which the IPKat and the enforcement authorities have occasionally clashed

Grüne Punkt home page here
More on the trade mark here