The Dusseldorf Higher Regional Court finds that sellers of high-quality cosmetics cannot invoke exhaustion of rights under the EU Trademark Regulation if they have not presented the products in a way that avoids impairment of the brand’s reputation (Kanebo)

The Higher Regional Court of Düsseldorf decided that neither online nor offline sellers can invoke exhaustion of rights under Article 15(1) of the EU trademark regulation if they sell high-quality, prestigious cosmetic products without appropriate presentation to avoid impairment of reputation. Circumstances of the Decision Kanebo focuses on the sale of cosmetics and fragrances. It sells these products exclusively via selective distribution systems. Real, a German retail chain that sells products in stores and via an online shop, offered Kanebo’s products online and offline. These products were marked with Kanebo’s registered EU trademarks. Kanebo sought a preliminary injunction against Real to stop the online and offline sale of products that carried Kanebo’s registered EU trade