The Court of Conciliation for Internet Domains at the Polish Chamber of Information Technology and Telecommunications (the CCID) in its award of 9 March 2010 case file 74/09/PA dismissed the complaint brought by Italian company Bisazza against Polish entrepreneur Rafał Kacprzak Installation.pl from Wrocław who registered the following domain names: bisazza.pl, bisazza.com.pl and bisazza-installation.com. Bisazza claimed that the registration of .pl domains infringed on its BISAZZA CTM no. 001494590 and word-figurative “BISAZZA mosaico” CTM no. 001500248. Surprisingly, the Court did not agree with arguments provided by the Italian company and held that there was no infringement because the regulations included in the Polish Industrial Property law that did not allow for such interpretation. According to the CCID, there was no delict/tort of unfair competition as activities of both companies should be deemed as complementary. The CCID noted that Bisazza could act more carefully and it should have registered both domain names much earlier. According to the Court, by advertising products of the Italian company, Mr. Kacprzak was not acting as a cyber squatter because he did not only intend to increase his financial benefits but he was doing it in order to maximise mutual benefits. The Court also said the Mr. Kacprzak did not infringe on the company name.

Bisazza S.p.A. filed a complaint against this controversial decision. The Company claimed the arbitration award is contrary to the public policy rules established in the Republic of Poland, including the protection of acquired rights, social justice, stable and secure law, comprehensive examination of the case, consistency of legal decisions and integrity of the legal system.

The District Court in Warsaw, the Court for the Community Trade Marks and Community Designs (in Polish: Sąd Okręgowy w Warszawie Wydział XXII Sąd Wspólnotowych Znaków Towarowych i Wzorów Przemysłowych) in its judgment of 20 September 2010 case file XXII GWzt 17/10 annulled the questioned award. To begin with, the Court reminded that the Polish legislator sought to strengthen the arbitration proceedings by limiting the possibility of challenge of the awards issued by courts of arbitration. The competence of common courts in controlling the correctness of awards issued by arbitration courts are very limited and strictly defined. The petition for the reversal of the arbitration award belongs to the category of special appeals. It has a cassatory character (annulment of a judicial decision is allowed only in certain cases under strict conditions). In such proceedings the Court will not examine the merits of the dispute (if the facts warrant issued ruling) or verify the correctness of the findings that were made and accepted. All the grounds justifying of the petition for the reversal of the arbitration award are included in the Article 1206 §1-2 of the CPC.

§ 1 By way of an application a party may apply for the award to be set aside if:
1) there was no arbitration agreement, the agreement is not valid, ineffective or has expired under the law applicable to it;
2) the party was not given proper notice of the appointment of an arbitrator, of the arbitration proceedings or was otherwise unable to present its case before the arbitration tribunal;
3) the award deals with a dispute not contemplated by or beyond the scope of the arbitration agreement, provided that, if the decisions on matters submitted arbitration can be separated from those not so submitted or falling beyond the scope of the arbitration agreement, then only that part of the award which relates to the matters not submitted or falling beyond the submission may be set aside; the fact that a matter is beyond the scope of the arbitration agreement cannot constitute a ground for setting aside the award if a party who participated in the proceedings did not object to those claims being heard;
4) the composition of the arbitration tribunal or the fundamental rules of arbitral procedure were not in accordance with the agreement of the parties or with a provision of law;
5) the award was obtained by way of a crime or on the basis of a forged or falsified document,
6) a final judgment has already been made in the same case between the same parties.

§ 2. The arbitration award shall also be set aside if the court finds that:
1) the dispute was not capable of settlement by arbitration under the law;
2) the award is contrary to the public policy rules in the Republic of Poland (public order clause).

The Court noted that when assessing whether an arbitration award is contrary to the fundamental principles of law, the Court should take into account its content and not the correctness of the proceedings that were held before the arbitration body. The basic principles of the law underlying the assessment of the award should be understood not only as the constitutional rules but also as the general norms and rules in particular areas of law. The breach by an arbitration body of the proper substantive law justifies the reversal of the arbitration award only if the award is contrary to legal order.

The arbitration body shall decide on the dispute according to the law of the legal relationship and when the parties explicitly mandated it – by the general principles of law or equity/fairness. The District Court concluded that the interpretation of basic principles of trademark law both national and Community, that was provided by the CCID in its award, shows lack of understanding of the merits of law and lack of the ability to apply existing rules to the facts of this case. The arbitration court committed various irregularities: by qualifying the rights to Bisazza trade marks as national property rights, in examining the infringement based on only one character – probably a word trade mark – without considering the reputation, by dismissing the infringement claims on the basis of facts that do not have any meaning in trademark law while failing to examine identity/similarity of the marks and signs included in Internet domains and the goods and services of each party. The court reminded the arbitrator that the rules and regulations under the First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks, the CTMR and the case law of the Court of Justice of the UE apply directly in disputes over infringement of the Community trade mark. These rules and regulations must be applied also by national courts including arbitration bodies. Incorrect choice of legal norms and wrongful interpretation led to an unjustified deprivation of protection which is afforded to Bisazza in relation to its trademarks.

Mr Kacprzak appealed. The Appellate Court in Warsaw in its judgement case file I ACa 1087/10 overturned the judgment of the District Court. The Court found that since the CCID ruled that it has no jurisdiction to hear and decide upon some of the demands made by Bisazza, and rejected them in the suit, the decision was final and could not be controlled at all by the civil courts, including the proceedings caused by an action for annulment of an arbitration award. The findings stating that the CCID had no jurisdiction, that were based on the domain names regulations issued by the Scientific and Academic Computer Network (Naukowa i Akademicka Sieć Komputerowa), did not constitute a breach of the basic principles of the law (the public order clause), because Bisazza could take these demands to a civil court. In the opinion of the Appellate Court, the District Court failed to consider whether the erroneous application of the Polish law rather than the EU by the CCID was tantamount to violation of the basic principles of the law. It could have been so, only if it had a significant impact on the content of the decision rendered by the CCID. In the opinion of the Appellate Court, however, there was no such effect in this case. The Appellate Court ruled that the relevant regulations provided in the Polish law are the result of the implementation of the Directive 89/104/EEC and its relevant provisions required for this case to be then included in the CTMR. The Court decided that the solutions provided in the Polish law are similar to those of EU legislation, and the classification of infringement of trade mark rights is done by the same rules. The Appellate Court noted that the CCID found that Mr Kacprzak used, in the course of trade, a trademark identical to a protected mark not in relation to identical or similar goods but to goods protected by this trademark. The defendant is an installer of Bisazza mosaics but not identical or similar mosaics. The CCID examined also whether or not there is an infringement of reputed trademark, however, found no such breach. The Appellate Court also ruled that the award of the CCID did not violate the rules and principles of a stable and secure law because these rules should relate to the creation of law and not its application.

See also “Polish case law on domain names“.