compensation claim

Basically, a compensation claim, (based on the contents of Paragraph 14, Clause 6 and Paragraph 15, Clause 5, Trademark Law) is only taken into consideration when the violator is accused of intent, or negligence. This is of a theoretical nature though, as more commonly the estimation of damages is the so-called license analogy, (see below) which also can be attained from Paragraph 812, German Civil Code. Regulated in this Paragraph is the claim for unjustified enrichment.

Additionally, the law is very strict when it comes to the acknowledgement of one's responsibility. In the case of violating a brand, it is not considered as culpable when one makes use or registers one's own brand that was already registered, but was not yet published. As in any case the law considers it negligent if one does not search for registered brands and firm names in the trade register before proceeding with the use of it.

The damaged party has a right to choose the claim for his compensation. The damaged party does not have to just settle for actual concrete financial damage and lost profits suffered because of the violation, Paragraph 249, 250, German Civil Code. More over, the damaged party can claim for the profits from the violator or for damage compensation, according to the so-called, license analogy.

Each of those possibilities to estimate the damage can be made valid next to the others. The right to chose the claim for compensation expires after the fulfillment of the validly made claim or the legally valid decision over the same. However, in practice the right to choose the claim is essentially useless, since neither the estimation of the lost profits, nor those profits of the violator, can be determined, let alone proven.
Regarding the lost profits, there are aspects missing on which one can fixate upon in order to hypothetically determine the increased sales that the damaged party could have made without the unlawful act. The estimation of the violator's profits requires, in accordance with the conditions of the Supreme Court, a calculation of the profit share which can go back to the violating use of the trademark and not to other factors.

The license analogy means that the damaged party does not need to consider the other types of estimation of damages and grants it at least one remuneration, which would correspond to usual market license remuneration. The basis of assessment depends on the individual case, but will include the degree of the danger of market confusion, how well known the label is and the duration and range of the damaging actions.

There can also be other types of calculations, other than the ones mentioned above. Damage caused by market confusion, is a further example of a damage that can be caused. However, this is only as long as it is not already considered in the calculation according to the license analogy.

The Supreme Court reached a decision regarding Channel NO 5 that acknowledged that it was basically an unjustified enrichment claim, according to Paragraph 812, Clause 1, Sentence 2 2, German Civil Code, because of the violation of the trademark. This is quite important, because the claim is not dependant on the blame of the violator, like how it is in Trademark Law. The amount of this claim has to be estimated using the method of the license analogy.

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