Luxury Watchmaker Wins Parallel Imports Case in Russia

On November 14, 2011, the Commercial Court of Saint Petersburg and the Leningrad Region ruled in favor of the luxury watchmaker Longines Watch Co. Francillon Ltd., member of the Swatch Group, in a parallel import case against the Russian online shop Bestwatch.ru (Bestwatch.ru LLC) and the website administrator Adelia LLC.

Bestwatch.ru did not deny that it had offered the watches bearing the mark Longines for sale. However, Bestwatch.ru failed to prove that it had trademark owner’s permission to put the goods into circulation.

The court ruled that importing branded goods without the trademark owner’s consent violates exclusive trademark rights and prohibited the online shop from offering Longines watches for sale.

Longines demanded compensation for damages in the amount of approximately USD 159,000 (EUR 122,000) from Bestwatch.ru and USD 3,200 (EUR 2,460) from Adelia. The court upheld the claim against Adelia in full and reduced the compensation from Bestwatch.ru to USD 96,000 (EUR 74,000).

Both defendants have filed appeals at the 13th Arbitration Court of Appeals in Saint Petersburg, but did not provide evidence of payment of the appeal-filing fee. For this reason, the appeal has been suspended until February 6, 2012.

In recent years, the Federal Antimonopoly Service of the Russian Federation has been pushing to legalize parallel import by amending the Article 1487 of the Civil Code of the Russian Federation, which clearly prohibits it. The Russian government will reportedly consider this issue in the spring of 2012.

For more information, please contact Yuriy Karlash at our Ukraine office.

Source: The Supreme Arbitration (Commercial) Court of the Russian Federation