The dispute and the decision below
In its judgment of 26 February 2026, case 2024Da311181, Korea’s Supreme Court examined bags and wallets remade from customers’ branded bags. Between approximately 2017 and 2021, the defendant reused fabric and metal fittings, changed the articles’ size, shape or function, and returned them to their owners. Customers selected samples or proposed designs, while the workshop advised on feasible options and performed the cutting and assembly.
The trade mark owner sought an injunction and damages, with an alternative claim for unfair competition through harm to the distinctiveness or reputation of its well-known marks. On 28 October 2024, in case 2023Na11283, the Patent Court treated the remade articles as independently tradable goods and allowed the injunction and part of the damages claim. That earlier appellate ruling must be distinguished from the subsequent Supreme Court judgment.
Private remodelling is not necessarily use of a trade mark
The Supreme Court linked statutory trade mark use to supplying marked goods to the market. Where an owner remakes an article solely for personal use and the resulting item does not enter commercial circulation, the presence of the mark in that process does not, in principle, amount to trade mark use. A substantial change in appearance does not dispense with that inquiry.
The same starting point applies when a skilled workshop performs the work for payment. Otherwise, the owner’s freedom to alter personal property would depend on possessing the necessary skills. Ordinarily, ownership remains with the customer, payment remunerates a service rather than the sale of a new product, and the finished article returns to the customer’s private sphere.
Exhaustion and the commercial exception
An authorised domestic sale generally exhausts the trade mark right in the particular article. Substantial reconstruction that effectively produces a new item may fall outside exhaustion. Even then, however, the separate question remains whether the mark is being used in market circulation. The Court also considered personal expression, longer product life and resource circulation.
A nominally private order may instead conceal production and marketing controlled by the workshop. Relevant factors include the circumstances of the order, who ultimately determines purpose, design and quantity, what the payment covers, the source and proportion of materials, and ownership before and after the work. The trade mark owner bears the burden of proving the exceptional circumstances. A workshop may also share liability if it participates knowing, or having reason to know, that the customer intends infringing distribution.
A partial remand, not blanket approval
The Supreme Court held that returning remade goods requested for their owners’ private use did not in principle establish trade mark use. It set aside the portions adverse to the defendant on the principal claim and the corresponding alternative claim, and remanded them to the Patent Court because the necessary exceptional circumstances and participation in infringement had not been examined. The ruling neither authorises every remodelling business nor finally rejects all unfair-competition allegations.
For practical review, document the real transaction: ownership, instructions, design and quantity decisions, material sourcing, delivery and itemised charges. A customer returning a bag for conversion into a personal wallet differs from a workshop buying bags to make wallets for sale. A statement saying ‘personal use’ is not conclusive; correspondence, photographs and transfer records help establish what actually occurred.
The original figure labels and forms are preserved; the text explains the facts and the court’s reasoning.