The company Terraco AB filed an invalidation action against Slovenian national trademark TERACO of CALCIT doo (registered for goods in Class 1 of the Nice Classification), based on its earlier International registration designating the EU TERRACO (registered for goods in Classes 1 and 2 of the Nice Classification). The Circuit Court refused the action, holding that there was no likelihood of confusion between the trademarks because the goods were dissimilar, due to differences between the marketed goods.
Terraco AB appealed arguing that the Circuit Court should compare registered lists of goods and invalidate the trademark due to likelihood of confusion on the market. The Higher Court refused the appeal although it held that the goods were similar, basing the refusal of the appeal on Article 119(3) of the Slovenian Industrial Property Act (SIPA), which states that an invalidation action is refused if conditions are met for non-use cancellation of the earlier trademark according to Article 120(1) of the SIPA (i.e. non-use of the earlier mark in Slovenia for more than 5 years after the registration date).
Terraco AB filed a petition for revision with the Slovenian Supreme Court, arguing that the Higher Court incorrectly assessed the territorial criterion of CTM use, denying the validity of CTM TERRACO in Slovenia, and applied provisions of the Slovenian law which were not applicable to CTMs. The Supreme Court held that non-use of a CTM in Slovenia is not a reason for refusing an invalidation action against Slovenian national trademark, based on the CTM, reversed the earlier judgments and invalidated the Slovenian trademark TERACO.