The Problem of Earlier Rights: Evidence from the European Trademark System

Laws protecting intellectual property rights balance interests of earlier and later rights holders. The tradeoffs are well established for patents. We argue that similar considerations apply to trademarks. Jurisdictions differ in how strongly they protect earlier rights, with EU trademark law protecting the registered use of an earlier right for much longer than US trademark law. Laws in both jurisdictions seek to eventually align registered use of earlier rights with their actual use, creating space on the trademark register for later rights. Data from a recent reform of trademark fees reveal that registered and actual use of EU marks frequently fail to align as intended. We analyse trademark opposition cases at EUIPO to test whether this creates costs for owners of later rights. We find that a subset of firms relies on the protection afforded to earlier rights to permanently expand the breadth of their marks beyond actual use, limiting access to trademarks for later applicants. We discuss policy implications.