Pitfalls – Cease and desist declaration
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1. Does the right to injunctive relief expire upon receipt by the creditor/trade mark owner of a cease and desist declaration with a penalty clause issued by the infringer?
If a third party has infringed a trade mark, the trade mark owner is entitled to obtain an injunction against the infringer. The trade mark infringement gives rise to a presumption of the existence of a likelihood of repetition. According to established case law of the German Federal Court of Justice (BGH), the risk of future infringement can only be eliminated by a final injunction with the threat of sanctions or by a serious, clear and irrevocable declaration to cease and desist covering the subject matter of the claim with the acceptance of an appropriate contractual penalty.
According to the previous case law of the German Federal Court of Justice, the mere receipt of the cease and desist declaration resulted in the end of the risk of recurrence, even if the creditor refused to accept it.
In its decision of 1 December 2022 – I ZR 144/21 – the German Federal Court of Justice changed its case law:
The final elimination of the risk of recurrence now depends on an act of will on the part of the creditor, namely the acceptance of the declaration of discontinuance with a penalty clause. However, if the creditor rejects the debtor’s declaration of discontinuance with a view to concluding a corresponding contractual penalty agreement, the conclusion of the contractual penalty agreement fails and the deterrent effect required to eliminate the risk of recurrence by means of a (threatened) contractual penalty is no longer present.
If, in such a case, the creditor asserts its claim for an injunction in court, the defendant (debtor) should immediately acknowledge the claim with the consequence that the plaintiff (creditor) will have to bear the costs of the proceedings (Section 93 ZPO – German Code of Civil Procedure).
The injunction creditor should therefore carefully consider whether it is not more advisable to accept the debtor’s declaration of discontinuance with a penalty clause.
In order to avoid the risk of multiple warnings by third party creditors and the associated burden on the debtor with additional warning costs, the debtor whose penalty declaration has been rejected by the first creditor should, without being asked, submit to a third party and conclude a penalty declaration with that third party.
2. Is it sufficient for the debtor to send the declaration to the creditor as a PDF file attached to an e-mail or must the creditor receive the original declaration by post?
In principle, there is no written form requirement for a cease-and-desist declaration made by a merchant in the course of his* commercial business, see Sections 343(1), 350 German Commercial Code (HGB). In addition, the text form regulated by the legislator in section 126b German Civil Code (BGB) has prevailed in commercial and legal transactions, for which a simple email is also sufficient (cf. BGH, judgment of 12 January 2023 – I ZR 49/22, para. 23 – Unterwerfung durch PDF).
However, if the creditor also demands to receive the original of the declaration and thus to comply with the optional written form (sec. 127 (1) in conjunction with sec. 126 (1) German Civil Code (BGB), but the debtor only sends the declaration to the creditor as a PDF file attached to an e-mail and the creditor then refuses to accept the declaration subject to a penalty, the risk of recurrence does not cease to exist in connection with the new case law of the Federal Court of Justice (see above under no. 1). In such a case, the debtor must rather expect that the creditor will – successfully – enforce his claim for an injunction in court.
In order to avoid court proceedings, the debtor should therefore comply with the creditor’s request for a cease and desist declaration with penalty clause in the required written form.
*For the sake of readability, the simultaneous use of the masculine, feminine and diverse (m/f/d) forms has been dispensed with. All personal terms apply equally to all genders.