Grupo Ilusión de Ortodoncistas, S.L. brought a number of actions against Laboratorio Lucas Nicolás, S.L., owner of the website, based on infringement of the trademark “Clínicas Ortodoncis”. The defendant used the applicant’s trade mark as an adword to redirect to a result advertising the defendant’s franchise network of dental clinics, preceded by the applicant’s own trade mark. The services offered by the defendant on its website (Vitaldent) to which the advert refers were identical to those offered by the applicant under its trade mark.

The decision examines various questions raised by the applicant, one of which concerns the scope of a trade mark proprietor’s right to prohibit an advertiser from using a keyword identical to the trade mark which it has selected without the proprietor’s consent in the context of an internet referencing service to advertise goods or services identical to those for which the trade mark is registered. The decision reviewed here begins by recalling that this issue was dealt with by the ECJ in decisions of 23 March 2010 (Google France. Joined Cases C-236/08 to C-238/08) and 22 September 2011 (Interflora, Case C-323/09). These decisions interpret Article 5(1)(a) of Directive 89/104 and Article 9(1)(a) of Regulation No 40/94 (now Article 10(2)(a) of Directive 2015/2436 and Article 9(2)(a) of Regulation 2017/1001, establishing as doctrine that the trade mark owner may prohibit the advertiser from using the trade mark provided as long as “such advertising does not allow or scarcely allows the average internet user to determine whether the goods or services included in the advertisement originate from the proprietor of the trade mark or an undertaking economically linked to it or whether, on the contrary, they originate from a third party”. In general, it may prohibit use where it would impair one of the functions of the trade mark.

On this basis, and taking into account the proven facts, the Supreme Court considers that the defendant’s conduct reasonably leads the searcher to believe that the services offered on the website are linked to the applicant, with the result that the function of indicating the business origin of the goods is impaired, so that the trade mark proprietor can prohibit the improper use of its trade mark.

The second issue that we highlight in this judgment relates to the assumptions of the infringement and the determination of the damage, specifically the interpretation of article 43.5 of the Trademark Law. The Decision bases its argumentation on the doctrine of the Supreme Court itself established in the Decision of 3 October 2019, according to which the Trademark Law distinguishes between what it calls the “assumptions of the compensation for damages” of art. 42 and the “calculation of the compensation for damages” of art. 43. The application of these rules for the calculation of damages implies a prior assessment of which infringement has caused them. Regarding the burden of proof, the doctrine has an exception in its own case law, which considers correct the presumption of the existence of the damage (apart, of course, when there is a specific legal rule in this respect) when there is a situation in which the damages are revealed as real and effective.

These are cases in which the existence of the damage is necessarily and fatally deduced from the wrongful act or the non-performance, or they are a forced, natural and inevitable consequence, or incontrovertible, evident or patent damage. A situation arises in which “the thing itself speaks” (ex re ipsa), so that there is no need for proof, because reality acts incontestably for it. But, as the Decision makes clear, invoking the decision of the Supreme Court itself of 31 May 2011 “it is one thing if the situation of the case reveals the existence of the damage without having to be supported by evidence, and quite another if there is a legal presumption that excludes the need for evidence in any event”. Ultimately, “the assessment of that situation is part of the sovereign function of the courts hearing the case”.

On that basis, the court of first instance held that the use of the applicant’s trade mark as an adword to redirect to a result advertising the defendant’s network of franchised dental clinics, preceded by the applicant’s own trade mark, must necessarily have caused some damage, irrespective of the difficulty of proving the number of cases in which, as a result of the confusion, a potential client of the applicant went to Vitaldent clinics.

Finally, the decision examines the question of the basis for calculating the compensation of 1 per cent of business volume to be taken into consideration. The question arises as to whether this percentage should be applied to all the services provided by the defendant’s franchise network or only to “sales obtained through the use of the “Ortodoncis” trade mark. The decision is based on the fact that art. 43.5 of the Trademark Law establishes that “the owner of the trademark whose infringement has been judicially declared shall be entitled, in any case and without the need for any proof, to receive damages of 1 percent of the business volume achieved by the infringer with the unlawfully marked goods or services”.

The business volume is not determined by taking into account the services actually provided as a result of the trade mark infringement, in other words, the services invoiced to those who went to Vitaldent as a result of the advertisement which constituted an infringement of the defendant’s trade mark. Rather, the business volume refers to all the unlawfully marked services, in this case all those which it has been established at first instance were advertised by means of the infringement of the applicant’s trade mark (implants, orthodontics, pediatric dentistry and aesthetic dentistry), without it being necessary to distinguish which were actually provided as a result of the advertisement and which were not.

Decision of the Supreme Court (Civil) of 20 April 2022