Invalidity of a Trademark Registered in Bad Faith: How To Assess the Fraudulent Intent?

Invalidity of a Trademark Registered in Bad Faith: How to Assess the Fraudulent Intent?

In a well-grounded decision concerning the “RICHARD MILLE” trademark, the Paris Court of Appeal clarified the scope and conditions of a cancellation action for fraud. This decision, handed down in accordance with the law applicable prior to the entry into force of Order No. 2019-1169 of November 13, 2019, provides an opportunity to review the legal framework for such actions and its recent developments.

By Nathalie Marchand and Julie Beisbardt, attorneys at the Paris Bar, d’Alverny Avocats

Paris Court of Appeal, Division 5 Chamber 1, October 29, 2025, No. 24/04961

In a judgment dated October 29, 2025, the Paris Court of Appeal ruled on the invalidity of the French word trademark “RICHARD MILLE,” filed by an individual on November 2, 2019, in classes 7, 12, 38, and 42, and considered by the Turlen company, owner of the earlier eponymous trademarks, as infringing upon the reputation of its trademarks and as fraudulent.

In this decision – made after a relatively lengthy judicial saga (remand following a recourse before the Supreme Court (Cour de cassation) after an appeal against the Trademark Office’s decision (INPI)) – the Paris Court of Appeal specified, in great detail, the conditions for an invalidity action for fraud. The judgment also ruled on the invalidity because of the infringement to the reputation of the earlier trademark. However, we will set aside this aspect of the decision here in order to focus on the fraud.

This decision provides an opportunity to review legislative and regulatory developments regarding cancellation action for fraud or bad faith (I.) and offers enlightening guidance on the characterization of fraudulent intent (II.).

I. Developments in the Legal Framework of Nullity for Fraud or Bad Faith

The French legal framework prior to Ordinance No. 2019-1169 of November 13, 2019

Before examining the specific features of this decision, it is appropriate to remind the legal framework governing nullity actions for fraud or bad faith filing. Prior to Ordinance No. 2019-1169 of November 13, 2019, no provision of the Intellectual Property Code (“IP Code “) provided for an action for cancellation of a French trademark for fraud. Only the ownership claim grounded on Article L. 712-6 of the IP Code existed in the event of registration applied for either in fraud of the rights of a third party or in violation of a legal or contractual obligation.

Nevertheless, on the basis of the combination of this provision and the principle fraus omnia corrumpit, Courts have consistently held that a trademark may be cancelled because of the applicant’s fraud. On the basis of Article L. 712-6 of the IP Code and fraus omnia corrumpit, the Cour de Cassation has in particular established the following principles for assessing the concept of fraud:

• fraud exists where a trademark application is filed with the intention of depriving another party of a sign necessary for its business activity (Cass. Com., April 25, 2006, No. 04-15.641);
• a cancellation action does not require the claimant to establish prior rights in the disputed sign, but rather to prove the existence of interests knowingly disregarded by the applicant (Cass. Com., December 19, 2006, No. 05-14.431); and
• a trademark application filed without the intention of using it for the applicant’s own goods, while the applicant was aware of the use of the sign for goods of the same nature by the claimant and thus sought to block or hinder the entry of the claimant’s goods into the French market, knowingly disregards the interests of others (Cass. Com., March 17, 2021, No. 18-19.774).

While French courts have found in this principle a basis allowing for the cancellation of trademarks registered fraudulently, such actions were subject to judicial proceedings on the merits and were not possible before the INPI.

The evolution of the cancellation action for fraud under the impetus of European regulations and case law

Entering into force on December 15, 2019, Ordinance No. 2019-1169 of November 13, 2019 transposed Directive No. 2015/2436/EU of December 16, 2015 approximating the laws of the Member States relating to trademarks and ensured the compatibility of French law with Regulation (EU) No. 2017/1001 of June 14, 2017 on the European Union trademark.

Several articles of the IP Code have been amended to specify the conditions of the cancellation action for fraud and, in particular, the following articles:

• 711-2 of the IP Code has been completed by a provision specifying that “Cannot be validly registered and, if registered, are liable to be declared invalid: (…) 11° A trademark whose application was filed in bad faith by the applicant“;
• 714-3 of the IP Code added that the registration of a trademark shall be declared invalid if it does not comply with the conditions set forth in Article L. 711-2 of the IP Code; and
• 716-2 of the IP Code specified that such actions are brought before the INPI.

Thus, cancellation actions for fraud now constitute an independent ground for nullity governed by specific statutory provisions which no longer refer to fraud, but to filing in bad faith. Cancellation actions have been available before the INPI since 1^st April 2020, but judicial courts remain competent, in particular, to rule on counterclaims for nullity.

The teachings of the CJEU for assessing the intention behind a filing in bad faith

The criteria and conditions of bad faith filing have, in parallel, been clarified by the CJEU in several decisions that allow for a better understanding of the evidentiary requirements for this cancellation action. The main teachings of the CJEU are the following:

• Koton case, September 12, 2019 (C-104/18) in which the CJEU specified that bad faith filing is established as soon as relevant and consistent indications reveal that the applicant was not acting with a legitimate purpose of competition, but rather to prejudice the interests of third parties or to obtain an exclusive right for purposes unrelated to the essential function of the trademark. The Court emphasized the necessity of a comprehensive assessment of bad faith, based on all existing factual elements, and indicated that although the applicant’s intention is subjective, it must be established objectively by the competent administrative or judicial authorities.
• Sky case, January 29, 2020 (C-371/18) in which the CJEU specified that a trademark application filed without any genuine intention of use for the claimed goods or services constitutes an act of bad faith, insofar as the applicant sought either to prejudice the interests of third parties in a manner that does not comply with honest practices, or to obtain an exclusive right for reasons unrelated to the essential functions of the trademark.
• CeramTec case, June 19, 2025 (C-17/24) in which the CJEU specified that “in accordance with its usual meaning in everyday language, the concept of ‘bad faith’ presupposes the presence of a dishonest state of mind or intention” and that “in order to assess an allegation of bad faith, it is necessary to establish the applicant’s actual intention on the basis of all relevant factual circumstances.”

Thus, bad faith is assessed by taking into account all relevant factors considered as a whole, through a range of evidence, in order to determine in a consistent and objective manner the applicant’s subjective intention at the time of the filing of the application.

II. What are the Relevant Factors for the Objective Establishment of the Applicant’s Dishonest Intention?

The characterization of the applicant’s fraudulent intent in the Richard Mille case

Although the decision of the Paris Court of Appeal dated October 29, 2025, was issued after the order of November 13, 2019, as the filing of the disputed trademark was made on November 2, 2019, the decision is rendered under the former law.

To conclude to the existence of a fraudulent filing, the Court provides a highly instructive reminder of the principles governing nullity for fraud, followed by a precise analysis of the evidence submitted by the claimant to demonstrate the applicant’s dishonest intention.

First, the Court examined the applicant’s knowledge of the “RICHARD MILLE” trademark. In this respect, the Court emphasized the reputation of “RICHARD MILLE” throughout the European Union. It then objectively considered certain indicators of such knowledge, notably the existence of a partnership established in 2018 between Turlen and Airbus Corporate, which resulted in a limited edition of watches inspired by aeronautical design, a field in which the applicant claimed to work. These elements thus objectively established the applicant’s knowledge of the earlier trademark.

The Court then analyzed the applicant’s intention and noted, among the factors establishing such intention, the following elements:

• the identity between the application and the earlier trademarks of Turlen;
• the absence of use of the disputed trademark since its filing in 2019;
• the existence of numerous filings of identical or highly similar trademarks to well-known trademarks by the same applicant; and finally
• the existence of an email sent by the applicant to Turlen, demonstrating his intention to obtain a financial benefit from the filing of the said trademark, for the goods or services for which it had been maintained.

On the basis of these elements and the principle of fraus omnia corrumpit, the Court therefore ordered the cancellation of the trademark, for all its goods and services, including those for which no infringement of reputation had been demonstrated.

What other factors may be taken into consideration to establish the dishonest intent of the applicant?

Other criteria are also frequently taken into account in assessing bad faith or dishonest intent, such as:

• sectoral proximity, particularly in restricted markets, in cases where the applicant and the owner of the earlier trademark are two main players (Cass. Com. February 2, 2016, No. 14-24.714);
• the intention to divert the purpose of trademark law or to illegitimately deprive another party of a sign necessary for its business, in particular where there are business relations between the applicant and the claimant, where the applicant was aware of the existence of a prior domain name identical to the trademark in question, and in the absence of use of the trademark by the applicant (Rennes Court of Appeal, July 1, 2025, No. 24/05280);
• the seniority of the earlier trademark, the absence of use by the applicant of the acronym registered as a trademark, and previous litigation between the parties (Paris Court of Appeal, March 30, 2018, No. 17/07421).

The judgment of October 29, 2025 is interesting because it tends to clarify the criteria for fraud in order to facilitate its recognition and to protect trademark owners against fraudulent filings. This trend is not limited to France and the European Union. China, for example, has also amended its trademark law by providing that fraudulent trademark applications –without intent to use– must be refused.

These developments should be welcomed in light of the rise of trademark trolls, namely certain actors who opportunistically register trademarks, not to exploit them but to block or charge those who need them. For the time being, only cancellation action is available in such case. However, it should be noted that in a recent decision, the European Union Intellectual Property Office took into account the bad faith of the applicant in the context of an opposition (and not an action for invalidity) based on harm to the reputation of an earlier mark in order to uphold the opposition (EUIPO, R 727/2024-2, March 19, 2025).

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