▒ SUPREME COURT DECISION (Case 2024Da311181 | February 26, 2026)
In our previous articles (see
here and
here), we detailed the first and second instances of an ongoing legal battle between a luxury brand owner and a local "reform" (upcycling) service provider.
Both the Seoul Central District Court and the Intellectual Property High Court had previously sided with the plaintiff, ruling that the defendant's act of deconstructing genuine bags to create entirely new products (such as wallets or smaller accessories) constituted "trademark use" that infringed upon the brand's rights.
However, in a landmark ruling issued on February 26, 2026, the Supreme Court of Korea reversed and remanded the matter back to the appellate court, in doing so clarifying the legal landscape for upcycling and personal property rights in Korea.
▒ THE SUPREME COURT’S REASONING
The Supreme Court took a significantly narrower view of what constitutes "use of a trademark" under the Trademark Act compared to the lower courts, with the core of the ruling resting on the distinction between use in the private domain and that of a commercial offering.
The Court held that if a product owner alters or upcycles a genuine branded item for personal use and does not offer it for sale or circulate it in the market, the act does not constitute "trademark use" and therefore cannot be an infringement. Crucially, the Court extended this protection to third-party service providers. It reasoned that since an owner has the right to reform their own property personally, they must also be free to seek the assistance of technical experts to exercise that right. As long as the service is performed at the specific request of the owner for their personal use and the item is returned to them, the reformer is generally not liable for infringement.
While the lower courts focused on whether the reformed item was a "new" product that damaged the identity of the original, the Supreme Court emphasized that trademark protection is intended to maintain fair competition in the marketplace, with use confined to the private domain not impacting a brand's business reputation or consumer interests in the commercial market.
▒ "SPECIAL CIRCUMSTANCES" AND THE BURDEN OF PROOF
Nonetheless, the Court did not grant upcyclers (reform service providers) free reign to do as they please, but clarified that trademark infringement may still be established under "special circumstances" where a reformer's actions cross into commercial production. To determine if a reform service should be deemed a commercial sale, courts must consider:
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Background and content of the reform request
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Purpose, form and quantity of the reformed products
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Who made the final decisions during the reform process
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Nature of compensation received by the reform service provider
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Source of materials supplied for the reformed product, and the proportion of such materials in the finished product
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Ownership of the reformed product
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(Joint liability may arise if the reformer was aware that the owner intends to offer the goods commercially, rather than keep the reformed product for personal use)
The burden of proving these special circumstances lies squarely with the trademark owner.
▒ COMMENTS
The Supreme Court itself acknowledged that this matter was being closely watched by courts from around the world, including the US, Japan, and Europe, and given the level of scrutiny and societal impact the ruling could bring, held a public hearing regarding the case in December 2025. In the end, the court’s reasoning is largely in line with that of the Swiss Federal Supreme Court in their comparable January 2024 ruling (Decision 4A_171/2023) dealing with the customization and upcycling of branded luxury watches.
For brand owners, it will not be enough to show that a product was "materially altered" in a trademark infringement claim, and instead they must prove that the reformer is effectively operating as a commercial manufacturer per the “special circumstances” detailed above.
The decision may be seen as a victory for reformers and upcyclers, but caution is required. Service providers should ensure they maintain clear records of customer requests and avoid dominating the design process to ensure their work remains firmly within the "personal use" exception.
The ruling is also notable for its explicit mention of social values. The Court noted that upcycling is often driven by a desire for environmental sustainability and the expression of individuality. By allowing reforms for personal use, the Court sought a resolution that balances trademark protection with the freedom of ownership and resource circulation.