Coexistence agreements – a useful tool in trademark disputes

• IP-IT
• Private Clients
• SME

Trademark coexistence agreements resolve conflicts between owners of older and newer trademarks. These avoid or settle potential opposition or injunction proceedings. In such agreements, the parties make binding arrangements on how the conflicting trademarks can coexist in the future, where their boundaries lie, and for which goods and services the owners definitively claim protection.

Purpose and content

As a rule, the trademark coexistence agreement serves to define the restrictions on the catalogue of goods and services under which the owner of a younger mark may use such a mark, or how the younger mark may be designed/appear in the future. This is often achieved by modifying the image element (logo) or by deleting terms from the list of goods and services. In return, the owner of the earlier trademark undertakes not to take action against the limited scope of the application or against the new application for the modified sign.

Coexistence agreements are not regulated under Swiss law. However, they are recognized contracts which, in principle, cannot be terminated unless there is an important reason for doing so. Coexistence agreements must not impede competition and should specify the right of the owner of the older trademark to take injunctive action. They must not contain any further restrictions on competition (e.g. market sharing, territorial allocation, etc.).

Additional useful provisions

Coexistence agreements usually contain additional provisions stipulating, for example, that the obligations of the owner of the younger trademark also apply to affiliated licensees, economically affiliated companies, legal successors, etc. Otherwise, there is a potential risk of circumvention.

Finally, there are clauses concerning possible breaches of contract and contractual penalties on the one hand, and concerning applicable law and jurisdiction on the other. In this context, it is not uncommon for the parties to request that any disputes arising from specific trademark law issues shall be settled by a commercial court or arbitration tribunal.

We are happy to advise and support you in potential trademark disputes and/or proceedings and in the drafting of coexistence agreements.