Oschadbank vs. Sberbank: Counsel of Spenser & Kauffmann Law Firm evaluates the likely litigation outcome

The Kyiv Commercial Court of Appeal has recently dismissed an appeal of Sberbank PJSC in an action seeking the early termination of a Ukrainian trademark certificate for “Sberbank” trademark, which certificate was issued to Oschadbank. The conflict between the banks over the use of the Sberbank brand has already developed into three lawsuits. No one is ready to give up waiting until the higher court determines the successful party.

The banks’ chances to defend their positions in court  have been analyzed for FinClub by Tatiana Kharebava, Counsel, Attorney, Head of Intellectual Property, IT and Antitrust at Spenser & Kauffmann Law Firm

Intellectual property claims are used to fight with competitors. “However, if we speak about the banking sector, the Ukrainian litigation practice hardly includes similar cases, which is why litigation between the Ukrainian bank and the Russian bank may be regarded as unique to a certain extent – says T. Kharebava. – At the same time, trademark protection cases including claims to cancel the disputed registration and to prohibit a competitor from using the objectionable trademark are encountered quite often. Courts often rendered their decisions in favor of title holders, thereby compelling the infringers to change company names and transfer disputed domains.”

The counsel believes that victory in the court of appeal in one of the three litigations would hardly help Oschadbank in the remaining two disputes. “The fact is that the matter in dispute in this case was Sberbank’s claim for early termination of the opponent’s trademark registration because of its non-use for a three-year period. Oschadbank managed to prove the lawful use of its trademark and, for this reason, the trademark registration remained in effect,” said the lawyer. However, other disputes are different in nature. “In the remaining two litigations, the matter concerns the invalidation of “competing” trademarks of each of the parties with effect from the date of submission of the respective application. In other words, if one of the parties wins the case, the opponent’s trademarks will be considered “non-existent”. Thus, each plaintiff has to prove that the plaintiff’s rights were infringed by the disputed registration at the moment the application was filed,” highlighted T. Kharebava.

A key argument of Oschadbank in case No. 910/570/16 is that “Sberbank’s disputed registrations are confusingly similar to the earlier registered trademark of the plaintiff” while Sberbank argues in case No. 910/11005/16 that “it is Oschadbank that infringed the rights of the Russian bank to the well-known trade name of the plaintiff by registering the disputed trademark, thereby misleading the consumers,” says T. Kharebava. Therefore, these remaining lawsuits are interrelated – and the outcome of one litigation will affect the outcome of the other.

She believes that the outcome of the case depends on whether the court of appeal upholds the Commercial Court’s decision of August 10, whereby the Court allowed the claim of Sberbank. “If the Court upholds the decision, Oschadbank’s chances will be minimal. The Ukrainian bank may even forfeit its own trademark – she complains. – However, if Oschadbank’s appeal is allowed, its chances of victory in the parallel proceedings may significantly increase.”