Annual Review of EU Trademark Law

March–April, 2020 Vol. 110 No. 2

Annual Review of

EU Trademark Law

2019 in Review

Tom Scoureld—CMS

London, United Kingdom, and Warsaw, Poland

with

rdi Güell—Güell IP

Barcelona, Spain

Martin

Viefhues—JONAS Rechtsanwaltgesellschaft mbH

Cologne, Germany

Anne Marie Verschuur—NautaDutilh

Amsterdam, The Netherlands

Pier Luigi Roncaglia—Spheriens

Florence, Italy

Sabine Rigaud and José Monteiro—CMS Francis Lefebvre Avocats

Paris, France

Ivo Rungg and Hellmut Buchroithner—Binder Grösswang

Vienna, Austria

Nina Ringen and Jonas Lykke Hartvig Nielsen—Lundgrens

Copenhagen, Denmark

Johan Norderyd and Christian Sundén—Lindahl

Malmö, Sweden

Tanguy de Haan—NautaDutilh

Brussels, Belgium

Alistair Payne—Acuatus Solicitors

Dublin, Ireland

Ewa Skrzydło-Tefelska—Sołtysiński Kawecki & Szlęzak

Warsaw, Poland

Sophie Wagner-Chartier—Arendt

Luxembourg

João Figueiredo—CMS Rui Pena & Arnaut

Lisbon, Portugal

INTERNATIONAL TRADEMARK ASSOCIATION

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YALA DEUTSCH ......................................................................................................................... President

IKI DARE .......................................................................................................................... President-Elect

EEGER VINK ...................................................................................................................... Vice President

OMARIE FREDERICKS ......................................................................................................... Vice President

ANA NORTHCOTT ..................................................................................................................... Treasurer

LISABETH BRADLEY ................................................................................................................... Secretary

RIN HENNESSY ........................................................................................................................... Counsel

TIENNE SANZ DE ACEDO ..................................................................................... Chief Executive Officer

The Trademark Reporter Committee

EDITORIAL BOARD

EDITOR-IN-CHIEF, CHAIR STAFF EDITOR-IN-CHIEF

GLENN MITCHELL WILLARD KNOX

Senior Editors

RAFFI V. ZEROUNIAN

PAMELA S. CHESTEK FABRIZIO MIAZZETTO

BRYAN K. WHEELOCK ANDREW J. GRAY

KAREN ELBURG LESLEY GROSSBERG

VERENA VON BOMHARD

Director of Legal Resources

LIZ HANELLIN

Senior Staff Editor Staff Editor

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Senior Legal Editor Senior Coordinator, Digital Content Compositor

ROSEMARY DESTEFANO SHANNON FRITSCHE BARBARA MOTTER

Editors

THOMAS AGNELLO

EUGENY ALEXANDROV

TARA ALLSTUN

CHARLENE AZEMA

MARTIN BERAN

DANIEL BERESKIN

SUBHASH BHUTORIA

JULIAN BIBB

STEPHANIE BUNTIN

ROBERT CAMERON

JEANNETTE CARMADELLA

JACQUELINE CHORN

THEODORE H. DAVIS JR.

MICHAEL DENNISTON

CATHERINE ESCOBEDO

DÉSIRÉE FIELDS

ALFRED FRAWLEY

ALEXANDRA GEORGE

STUART GREEN

STACY GROSSMAN

JORDI GÜELL

MICHAEL HANDLER

NATHAN HARRIS

BARRY HORWITZ

GANG HU

BRUCE ISAACSON

SIEGRUN KANE

INGRIDA KARINA-BERZINA

ELISABETH KASZNAR FEKETE

SONIA KATYAL

LINDSAY KOROTKIN

SENTHIL KUMAR

SCOTT LEBSON

SONAL MADAN

J.DAVID MAYBERRY

BRYCE MAYNARD

JAMES MCALLISTER

J. THOMAS MCCARTHY

CATHERINE MITROS

GAIL NEVIUS ABBAS

SHANA OLSON

R. TERRY PARKER

LUIS HENRIQUE PORANGABA

YASHVARDHAN RANA

BRANDON RESS

RICHARD RIVERA

SUSAN RUSSELL

CHELSEA RUSSELL

FLORIAN SCHWAB

TOM SCOURFIELD

RINITA SIRCAR

GIULIO ENRICO SIRONI

RANDY SPRINGER

CORY STRUBLE

MARTIN VIEFHUES

JEFFREY WAKOLBINGER

RITA WEEKS

JOHN L. WELCH

MARTIN WIRTZ

RUMENG ZHANG

Advisory Board

MILES ALEXANDER

WILLIAM BORCHARD

CLIFFORD BROWNING

LANNING BRYER

JESSICA CARDON

SANDRA EDELMAN

ANTHONY FLETCHER

ROBERT KUNSTADT

THEODORE MAX

KATHLEEN MCCARTHY

JONATHAN MOSKIN

VINCENT PALLADINO

JOHN PEGRAM

ROBERT RASKOPF

PASQUALE RAZZANO

SUSAN REISS

PIER LUIGI RONCAGLIA

HOWARD SHIRE

JERRE SWANN, SR.

STEVEN WEINBERG

The views expressed in The Trademark Reporter (TMR) do not necessarily reflect those of INTA. To fulfill its

mission of delivering cutting-edge scholarship on trademarks, brands, and related intellectual property to its

readers, the TMR sources content reflecting a diversity of viewpoints; the views expressed in any given article,

commentary, or book review are those of the individual authors.

The Trademark Reporter (ISSN 0041-056X) is published electronically six times a year by the International

Trademark Association, 675 Third Avenue, New York, NY 10017-5704 USA. INTA, the INTA logo,

INTERNATIONAL TRADEMARK ASSOCIATION, POWERFUL NETWORK POWERFUL BRANDS, THE

TRADEMARK REPORTER, and inta.org are trademarks, service marks, and/or registered trademarks of the

International Trademark Association in the United States and certain other jurisdictions.

The Trademark Reporter

Vol. 110 March–April, 2020 No. 2

TABLE OF CONTENTS

ANNUAL REVIEW OF EU TRADEMARK LAW

2019 in Review

I. Introduction ........................................................................... 460

A. About this Review ............................................................ 460

B. Legislative Change and Terminology ............................. 461

C. Organization of Material in This Review ....................... 462

II. Absolute Grounds for Refusal of Registration, and for

Cancellation ........................................................................... 462

A. Introductory Comments .................................................. 462

B. Legal Texts ....................................................................... 464

C. Cases ................................................................................ 469

1. EU—CJEU—Must marks consisting of a

combination of colors systematically specify the

spatial arrangement of such colors to be

considered sufficiently precise? ................................. 469

2. EU—CJEU—Was an EUTM relating to asset

management non-distinctive and descriptive in

respect of class headings only or for all services

for which it is registered? .......................................... 472

3. EU—CJEU—Does the concept of “shape” as an

absolute ground for refusal cover other

characteristics, such as patterns, applied to a

specific location on a two-dimensional product? ...... 475

ii Vol. 110 TMR

4. EU—General Court—Does a figurative

trademark consisting of “3 parallel equidistant

stripes of identical width applied on the product

in any direction” have distinctive character? ........... 478

5. EU—General Court—Must the shape of a three-

dimensional trademark depart significantly from

the common shape of the product in question to

have distinctive character? ....................................... 483

6. EU—General Court—Is a trademark composed

of a number of descriptive elements itself

descriptive of the characteristics of the goods or

services for which registration is sought? ................ 485

7. EU—General Court—Should the internal

mechanics of a shape be considered when

determining whether that shape is necessary to

obtain a technical result? .......................................... 486

8. The Netherlands—Supreme Court—Shape

trademarks—What is the relevance of

alternatives to achieve the same technical

result? ......................................................................... 489

9. Netherlands—Amsterdam Court of Appeal—

Shape trademarks—Shapes relating to the

nature of the goods as such ....................................... 491

10. Benelux—Benelux Court of Justice—Can an

English word be entirely descriptive and

unregistrable in the Benelux for certain goods? ...... 492

11. Austria—Higher Regional Court Vienna—Is a

word mark consisting of only one letter capable

of distinguishing origin? ............................................ 493

12. Germany—Federal Patent Court—Are celebrity

names as trademarks perceived as indicating

subject or source? ....................................................... 495

13. Ireland—Trade Mark Controller—FINGERS

mark refused registration on basis of absolute

grounds and lack of acquired distinctiveness .......... 497

III. Conflict with Earlier Rights—Relative Grounds for

Refusal of Registration .......................................................... 499

A. Introductory Comments .................................................. 499

Vol. 110 TMR iii

B. Legal Texts ....................................................................... 501

C. Cases ................................................................................ 509

1. EU—CJEU—When assessing the likelihood of

confusion, what is the overall impression created

by the mark as a whole, with regard to both word

and figurative elements? ........................................... 509

2. EU—CJEU—Does the conflicting nature of goods

covered by a trademark damage the reputation

of similar, earlier trademarks? ................................. 511

3. EU—CJEU—Do alleged methodological errors in

assessing the existence of a likelihood of

confusion amount to an error of law? ....................... 514

4. EU—General Court—Similarity of marks—Are

apples similar to pears for the purposes of an EU

trademark application? ............................................. 516

5. EU—General Court—Analysis of the

comparisons between marks composed of

personal names to establish likelihood of

confusion in an opposition ......................................... 519

6. The Netherlands—The Hague Court of Appeal—

Belgium—Brussels Court of Appeal— Who is the

relevant group when determining likelihood of

confusion? ................................................................... 522

7. Portugal—Lisbon Court of Appeal—Can the

assessment of the reputation of a trademark be

exclusively based on qualitative criteria? ................ 523

8. Sweden—Swedish Patent and Market Court of

Appeal—What is the proper scope of protection

for marks registered in monochrome or

grayscale? ................................................................... 524

9. Poland—Polish Supreme Administrative Court—

Guidance in the assessment of a link between an

earlier mark with reputation and a later

trademark .................................................................. 527

10. Denmark—The Danish Maritime and

Commercial High Court—What is the relevance

of the potential placement of figurative marks on

a product? ................................................................... 530

iv Vol. 110 TMR

11. Germany—Federal Patent Court—What is the

relevant scope of protection for acronyms as

trademarks? ............................................................... 532

IV. Bad Faith ............................................................................... 533

A. Introductory Comments .................................................. 533

B. Legal Texts ....................................................................... 534

C. Cases ................................................................................ 536

1. EU—CJEU—A trademark must be declared

invalid where the application to register was for

the intention of undermining the interests of

third parties or for obtaining an exclusive right

for purposes other than for the functions of a

trademark .................................................................. 536

2. EU—CJEU—Can an EUTM be declared wholly

or partially invalid on the grounds of bad faith

arising from a lack of intention to use the EUTM

under some of the specified goods and services

and on the basis of the specification of the goods

and services lacking sufficient clarity or

precision? .................................................................... 539

3. EU—CJEU—Will the courts declare a mark

invalid for bad faith where there had been

earlier unsuccessful collaboration discussions

between the parties prior to registration of the

mark? .......................................................................... 543

4. EU—General Court—When might an applicant

be acting in bad faith in cases relating to the

registration of famous names as trademarks? ......... 546

5. Spain—Appeal Court of Madrid—What is the

interconnection between bad faith and genuine

trademark use? .......................................................... 547

6. UK—High Court—Can an applicant’s activities

on unrelated actions be taken into account when

considering if an application was made in bad

faith? ........................................................................... 549

Vol. 110 TMR v

7. Poland—Polish District Administrative Court

(DAC)—What conditions and circumstances

support the allegation that the trademark has

been registered in bad faith? ..................................... 551

V. Use of a Trademark ............................................................... 553

A. Introductory Comments .................................................. 553

B. Legal Texts ....................................................................... 555

C. Cases ................................................................................ 562

1. EU—CJEU—Does “genuine use” of a trademark

include use on the packaging of food products to

describe the main ingredient of such goods? ............ 562

2. EU—CJEU—What is the relevance of “dotted”

and solid lines when assessing genuine use of

such marks? ............................................................... 564

3. EU—CJEU—Does a sign have distinctive

character if there is a possibility for it to be used

as an indication of origin, even if it is not the

most likely use? .......................................................... 567

4. EU—General Court—Is it necessary to evidence

use throughout the territory of the EU, and not

only in a substantial part or the majority of the

territory, in order to prove distinctive character

acquired by use? ......................................................... 569

5. Poland—Polish Supreme Administrative Court

(SAC)—What evidence is necessary to establish

genuine use of a trademark and what is the

relevant time frame for such evidence? .................... 571

6. Spain—Commercial Court of Barcelona—

Revocation of a historic but well-known mark ......... 573

VI. Trademark Infringement ...................................................... 575

A. Introductory Comments .................................................. 575

B. Legal Texts ....................................................................... 576

C. Cases ................................................................................ 581

vi Vol. 110 TMR

1. EU—CJEU—Can a trademark owner bring an

infringement action in a Member State where

advertising or offers for sale are directed at that

territory, even if the actual sale is concluded in

another territory? ...................................................... 581

2. Benelux—Benelux Court of Justice—Does

freedom of artistic expression constitute “due

cause” to use a trademark in an artistic

endeavor? ................................................................... 584

3. France—French Supreme Court—Can a

trademark that has never been used form the

basis of a trademark infringement action? .............. 585

4. Austria—Austrian Supreme Court—To what

extent may a logo trademark be used in

commercial communications without permission? .. 587

5. Germany—Federal Supreme Court—Use of a

mounting device for a trademark ............................. 589

6. Germany—Federal Supreme Court—When does

use of a term as a model or style name amount to

trademark use and risk infringement?..................... 592

7. Spain—Appeal Court of Alicante (EUTM

Tribunal)—The infringement of well-known

marks does not require a likelihood of confusion ..... 596

8. UK—High Court—Did the use of a similar mark

to a registered trademark take unfair advantage

of an earlier trademark with a reputation? ............. 598

9. UK—High Court—Is a mark consisting of two

separate elements one “combined sign” or two

separate signs for the purposes of infringement

proceedings? ............................................................... 600

10. Benelux—District Court of Luxembourg

(Luxembourg)—Infringement—Validity—

Coexistence between national and EU

trademarks ................................................................. 604

11. Belgium—Brussels Enterprise Court—Can

Amazon be held liable for the presence of

counterfeit goods on its platforms? ........................... 608

Vol. 110 TMR vii

VII. Limitation of Rights and Defenses ....................................... 609

A. Introductory Comments .................................................. 609

B. Legal Texts ....................................................................... 610

C. Cases ................................................................................ 612

1. Austria—Austrian Supreme Court—Does

exhaustion prevent a trademark owner from

objecting to the use of their trademarks on a

retailer’s packaging? .................................................. 612

2. Ireland—Irish Supreme Court—What is the

limit of the comparative advertising defense to

trademark infringement? .......................................... 614

3. Germany—Court of Appeal of Munich—

Exhaustion of trademark rights—damage to

aura of luxury may arise in presentation or mode

of distribution ............................................................ 621

4. Italy—Court of Milan—Parallel Trade—Does the

existence of a selective distribution network

amount to a “legitimate reason” to preclude

exhaustion of trademark rights? .............................. 625

VIII. Geographical Indications ...................................................... 627

A. Introductory Comments .................................................. 627

B. Legal Texts ....................................................................... 628

C. Cases ................................................................................ 630

1. Spain—Spanish Supreme Court—Trademarks

and geographical indications—How far can GI

protection go? ............................................................. 630

IX. Practice and Procedure ......................................................... 633

A. Introductory Comments .................................................. 633

B. Legal Texts ....................................................................... 633

C. Cases ................................................................................ 634

1. EU—CJEU—What is the impact of a disclaimer

that has been entered on the register of a

trademark in the global assessment of a

likelihood of confusion with another mark? ............. 634

viii Vol. 110 TMR

2. EU—General Court—The EUIPO must assess

the merits of the reasons put forward by the

party that has submitted evidence late or for the

first time at the Board of Appeal in order to

comply with its duties to exercise its discretion

and state its reasons when deciding whether to

admit the evidence ..................................................... 637

3. Germany—Federal Supreme Court—Grant of a

license and transfer of a right to terminate that

license by contractual interpretation ....................... 640

4. Spain—Supreme Court—What damages are due

under Spanish law to a plaintiff that has

suffered no loss? ......................................................... 645

5. Germany—Federal Supreme Court—Stay of

invalidity proceedings due to insolvency of

applicant..................................................................... 647

6. Germany—Nuremberg Court of Appeal—

Preliminary injunctions and lack of urgency ........... 649

7. UK—High Court (IPEC)—How effective is

survey evidence in proving that the relevant

public would associate a color with the trade

origin or particular characteristics of a product? ..... 650

8. Denmark—The Danish Maritime and

Commercial High Court—When may protected

names be used as trademarks? ................................. 653

9. Sweden—Swedish Patent and Market Court—

Should the test for distinctiveness differ as

between trademarks and Swedish business

names used in the course of trade? ........................... 655

X. Glossary ................................................................................. 656

Vol. 110 TMR 459

The Trademark Reporter

ANNUAL REVIEW OF

EU TRADEMARK LAW

2019 IN REVIEW

Tom Scourfield—CMS

London, United Kingdom, and Warsaw, Poland

with

Jordi Güell—Güell IP

Barcelona, Spain

Martin Viefhues—JONAS Rechtsanwaltgesellschaft mbH

Cologne, Germany

Anne Marie Verschuur—NautaDutilh

Amsterdam, The Netherlands

Pier Luigi Roncaglia—Spheriens

Florence, Italy

Sabine Rigaud and José Monteiro—CMS Francis Lefebvre Avocats

Paris, France

Ivo Rungg and Hellmut Buchroithner—Binder Grösswang

Vienna, Austria

Nina Ringen and Jonas Lykke Hartvig Nielsen—Lundgrens

Copenhagen, Denmark

Johan Norderyd and Christian Sundén—Lindahl

Malmö, Sweden

Tanguy de Haan—NautaDutilh

Brussels, Belgium

Alistair Payne—Acuatus Solicitors

Dublin, Ireland

Ewa Skrzydło-Tefelska—Sołtysiński Kawecki & Szlęzak

Warsaw, Poland

Sophie Wagner-Chartier—Arendt

Luxembourg

João Figueiredo—CMS Rui Pena & Arnaut

Lisbon, Portugal

460 Vol. 110 TMR

I. INTRODUCTION

A. About this Review

This seventh Annual Review of European Union (“EU”)

Trademark Law contains highlights of European trademark cases

of 2019 at both EU and national level. Matters relating to the

unitary right of the EU Trade Mark (“EUTM”) are governed by

Regulation (EU) 2017/1001 of 14 June 2017, referred to in this

Review as the “2017 EUTM Regulation.” Harmonized laws in

respect of national trademarks within EU Member States became,

as of January 15, 2019, determined by Directive (EU) 2015/2436 of

December 16, 2015, referred to in this Review as the “2015 TM

Directive.” Given the inevitable time lag between the introduction

of the recast legislation and its determination in case law, many

cases in this review still refer to the predecessors of the current

legislation in force, being Council Regulation (EC) No. 207/2009 (the

“2009 EUTM Regulation”) and Directive 2008/95/EC (the “2008 TM

Directive”). An introduction to the role of these instruments is

contained in the introduction to Annual Review of EU Trademark

Law: 2013 in Review,

which also details the particular role played

by the EU General Court and the Court of Justice of the European

Union (“CJEU”).

The familiar issues of trademark use, distinctiveness,

descriptiveness, and bad faith are all explored within this Review,

together with topics such as trademark use, infringement, parallel

trade, defenses and limitations, geographical indications (“GIs”),

and notable cases illustrating changes in practice and procedure.

Questions relating to the proper test for bad faith in respect of

national and EU trademark applications remained a “hot topic” in

2019, with the CJEU’s closely followed decision in Skykick being

handed down just in time before the United Kingdom (“UK”)

officially left the EU (to enter an agreed period of transition) and for

publication of this decision in the 2019 Review. The Skykick decision

was foreshadowed by the CJEU in Koton finding that a trademark

must be declared invalid where the application to register was for

the intention of undermining the interests of third parties or for

obtaining an exclusive right for purposes other than for the

functions of a trademark. In Skykick, the CJEU emphasized that a

lack of clarity and precision of terms used in the specification of a

mark is not an independent ground for invalidity (contrary to the

position advanced by the Advocate General in that case). Issues

relating to the scope of a specification should instead be dealt within

the non-use mechanisms for trademark law. Similarly, the CJEU

confirmed that the registration of a trademark without any

intention to use in relation to the specific goods and services covered

Guy Heath, Annual Review of EU Trademark Law: 2013 in Review, 104 TMR 445 (2014).

Vol. 110 TMR 461

by that registration may constitute bad faith, but that establishing

bad faith will depend on whether there is “objective, relevant and

consistent indicia” demonstrating that, at the time of filing the

application, the applicant had the intention of (dishonestly)

undermining the interests of third parties; or seeking an exclusive

right for purposes other than those falling within the functions of a

trademark. There would be no automatic finding of bad faith on the

basis that the applicant had no economic activity relating to the

goods and services listed in the trademark application. The

emphasis of the mechanism of revocation rather than bad faith to

determine such issues was also highlighted in the #daferdas case,

where the CJEU noted that, at the time of filing an EUTM

application, the applicant is not required to indicate or even to know

precisely the use it will make of the trademark applied for.

Aside from bad faith, important CJEU cases in this Review

include, among others, (i) the continued emphasis of the need for

clarity and precision in respect of color (and other) marks in Red

Bull, (ii) questions as to the definition of shape versus pattern in

Textilis, (iii) the relevance of solid or dotted lines in placement of

position and figurative trademarks when assessing genuine use

(Deichmann v. EUIPO), (iv) the proper assessment of

distinctiveness in variable modes of use in #daferdas, and (v) the

impact of “disclaimers” on national trademark registers in the

global assessment of confusion (Patent-och regidtreringsverket v.

Mats Hannson).

Among the “national” decisions selected for consideration, 2019

provided another fascinating collection of cases relating to a range

of issues including genuine use, the scope and validity of three-

dimensional trademarks, protection for trademarks with a

reputation, and acquired distinctiveness. The topic of parallel trade

and free movement of goods continues to be a fertile ground for

disputes between “luxury” brands and retail, examining whether

particular modes of presentation, packaging, or distribution might

amount to a “legitimate reason” to enforce trademark rights that

would otherwise be exhausted. Of notable interest were the

decisions examining the scope of protection of particular types of

trademarks including monochrome trademarks, position marks,

and marks comprising acronyms. Finally, national courts also

considered the interaction of trademarks with related or

complementary schemes of protection, including for GIs, personal

names, and business names.

B. Legislative Change and Terminology

There remains some difficulty in making sweeping references to

the relevant provisions of the Regulations governing EU law and the

Directives governing national laws because many of the rulings

reported in this Review are inevitably based on earlier iterations of

462 Vol. 110 TMR

the Regulations and Directives to those currently in force. Although

the “new” 2015 Directive is now in force, the 2008 Directive that it

replaces was repealed with effect only from January 15, 2019. The

new EU trademark regulation is referred to as “the 2017 EUTM

Regulation,” whereas references to the “2009 EUTM Regulation” are

references to the Regulation in force prior to the March 2016

amendments.

As in previous editions of this Review, several of its Parts

contain, in an introductory section, extracts of the most relevant

provisions of the regulation and directive. Extracts given at the

beginning of each part in this year’s Review are now taken from the

2017 EUTM Regulation. The texts given at the beginning now

include both the provisions of the 2008 TM Directive and the 2015

TM Directive, to reflect both the subject matter of the cases

discussed, and the provisions of the relevant law now in force.

C. Organization of Material in This Review

As usual, the 2019 case reviews are arranged by theme with

CJEU decisions appearing at the beginning, followed by the most

significant national decisions (according to the authors and

contributors in that jurisdiction). Each theme is contextualized with

introductory comments and recurring statutory provisions. Each

case note is introduced by an indication of whether the ruling is that

of the CJEU, EU General Court, or national court, with an

indication of the status of the relevant court concerned.

II. ABSOLUTE GROUNDS FOR REFUSAL OF

REGISTRATION, AND FOR CANCELLATION

A. Introductory Comments

As usual, the first substantive section of this year’s review

focuses on “absolute grounds” of validity for trademark registration.

Absolute grounds relate to the inherent characteristics of the

trademark, its clarity, precision, and scope and the extent to which

it can perform the essential function—to identify the exclusive

origin of the goods or services for which registration is sought.

Grounds for refusal of registration on the basis of absolute grounds

may also form the basis for a later claim to invalidation, so cases in

this section usually deal with analysis of both pre- and post-

registration issues.

Absolute grounds are considered under both Article 4 and Article

7 of the 2017 EUTM Regulation, since the considerations of Article

4 of the 2017 EUTM Regulation are incorporated by Article 7(1)(a)

of the 2017 EUTM Regulation. Similarly, Article 3(1)(a) of the 2008

TM Directive references Article 2 of the Directive. This is an area

particularly affected by the recent legislative changes, as noted in

Vol. 110 TMR 463

Part B (Legal Texts) below and the absolute grounds for refusal or

invalidity are all now (solely) contained in Article 4 of the 2015 TM

Directive although Article 4(1)(a), by implication at least,

incorporates Article 3 of that Directive.

The starting point for any consideration of registrability (or

validity) is therefore whether the “sign” in question is something “of

which a trademark may consist” within the bounds of EU law under

Article 4 of the 2017 EUTM Regulation/Article 2 of the 2008 TM

Directive/Article 3 of the 2015 TM Directive. If it is not, a valid

registration is impossible.

The “core” aspects of absolute grounds are effectively identical

as between EU trademarks and national trademarks in EU Member

States. The absolute grounds for refusal relating to EU trademarks

are set out in Article 7(1) of the 2017 EUTM Regulation. The

absolute grounds for refusal that must be applied by the national

trademark authorities of EU Member States under the 2008 TM

Directive are set out in Article 3(1) of the 2008 TM Directive.

The first four absolute grounds for refusal of registration are, in

general terms, (a) that the mark is not a sign capable of protection,

(b) that the mark is not distinctive, (c) that the mark is descriptive,

and (d) that the mark is generic. The last three of these grounds can,

in principle, be overcome by evidence that the trademark has

acquired distinctiveness through the use made of it prior to the

relevant date. The first cannot.

Article 7(1) of the 2017 EUTM Regulation and Article 3(1) of the

2008 TM Directive go on to provide certain specific absolute grounds

for refusal relating to shape marks, marks that would be contrary

to public policy, marks that would be deceptive, marks that raise

issues under Article 6ter of the Paris Convention, and marks that

contain certain GIs or designations of origin protected in the EU (see

Part VIII of this Review). Article 7(1) of the 2017 EUTM Regulation

now also expressly provides for absolute grounds of refusal by

reference to traditional terms for wine, to traditional specialities

guaranteed (“TSGs”), and to plant variety rights. Similar provisions

are contained in the 2015 TM Directive, where the absolute grounds

for refusal are contained in Article 4(1)(i) to 4(1)(l) of the 2015 TM

Directive.

As always, the limitation as to what may (or may not) constitute

a valid and enforceable trademark provides a range of thought-

provoking topics in any given year. The first case from the CJEU

features yet another Red Bull color mark, with Red Bull GmbH v.

EUIPO exploring the need for clarity and precision of a dual color

mark and the contrast of the graphic representation of such mark

and its description providing a lack of certainty as to how the color

combinations may be applied in any particular arrangement. The

protection of trademarks incorporating a shape element again

proved a fertile ground for dispute and analysis, with the CJEU

464 Vol. 110 TMR

considering whether a two-dimensional pattern might constitute a

“shape” in Textilis and the General Court of the CJEU considering

the registrability of a mark that was the common shape of a faucet

in Brita and in Rubik’s, the extent to which the internal mechanics

of a shape can be taken into account for the technical result

exclusions for shape marks. Before national courts, the Dutch courts

examined the interaction between trademarks and designs in Capri

Sun and the exclusion of shape marks relating to “the nature of

goods” as the Stokke dispute returned to the Amsterdam Court of

Appeal.

The question of distinctiveness, both inherent and acquired, was

also a common theme this year. In VM Vermögens-Management

GmbH v. EUIPO the CJEU considered whether, post–IP-

Translator, the assessment of distinctive character should be by

reference only to the (original) class heading or in respect of all

goods/services later designated. The General Court considered the

distinctive character of an Adidas “three stripe” mark and concepts

such as the law of permissible variations in respect of differences

between evidence, use, and the graphical representation of the mark

and in United Seafoods, whether a trademark composed wholly of

elements descriptive of the goods in question could nevertheless

have distinctive character overall. National courts also considered

the question of distinctiveness of trademarks comprising single

letters, celebrity names, and descriptive words such as “THINS” and

“FINGERS.”

B. Legal Texts

Article 4 of the 2017 EUTM Regulation

An EU trade mark may consist of any signs, in particular

words, including personal names, or designs, letters,

numerals, colours, the shape of goods or of the packaging of

goods, or sounds, provided that such signs are capable of:

(a) distinguishing the goods or services of one

undertaking from those of other undertakings; and

(b) being represented on the Register of European Union

trade marks (“the Register”), in a manner which

enables the competent authorities and the public to

determine the clear and precise subject-matter of the

protection afforded to its proprietor.

Article 2 of the 2008 TM Directive

A trade mark may consist of any signs capable of being

represented graphically, particularly words, including

personal names, designs, letters, numerals, the shape of

goods or of their packaging, provided that such signs are

Vol. 110 TMR 465

capable of distinguishing the goods or services of one

undertaking from those of other undertakings.

Article 7 of the 2017 EUTM Regulation

Absolute grounds for refusal

1. The following shall not be registered:

(a) signs which do not conform to the requirements of

Article 4;

(b) trade marks which are devoid of any distinctive

character;

indications which may serve, in trade, to designate

the kind, quality, quantity, intended purpose, value,

geographical origin or the time of production of the

goods or of rendering of the service, or other

characteristics of the goods or service;

(d) trade marks which consist exclusively of signs or

indications which have become customary in the

current language or in the bona fide and established

practices of the trade;

(e) signs which consist exclusively of:

(i) the shape, or another characteristic, which

results from the nature of the goods themselves;

(ii) the shape, or another characteristic, of goods

which is necessary to obtain a technical result;

(iii) the shape, or another characteristic, which gives

substantial value to the goods;

(f) trade marks which are contrary to public policy or to

accepted principles of morality;

(g) trade marks which are of such a nature as to deceive

the public, for instance as to the nature, quality or

geographical origin of the goods or service;

(Note: paragraphs (h)–(m) were omitted.)

2. Paragraph 1 shall apply notwithstanding that the

grounds of non-registrability obtain in only part of the

Union.

3. Paragraph 1(b), (c) and (d) shall not apply if the trade

mark has become distinctive in relation to the goods or

services for which registration is requested in

consequence of the use which has been made of it.

466 Vol. 110 TMR

Article 3 of the 2008 TM Directive

1. The following shall not be registered or, if registered,

shall be liable to be declared invalid:

(a) signs which cannot constitute a trademark;

(b) trade marks which are devoid of any distinctive

character;

indications which may serve, in trade, to designate

the kind, quality, quantity, intended purpose, value,

geographical origin, or the time of production of the

goods or of rendering of the service, or other

characteristics of the goods or services;

(d) trade marks which consist exclusively of signs or

indications which have become customary in the

current language or in the bona fide and established

practices of the trade;

(e) signs which consist exclusively of:

(i) the shape which results from the nature of the

goods themselves;

(ii) the shape of goods which is necessary to obtain a

technical result;

(iii) the shape which gives substantial value to the

goods;

(f) trade marks which are contrary to public policy or to

accepted principles of morality;

(g) trade marks which are of such a nature as to deceive

the public, for instance as to the nature, quality or

geographical origin of the goods or service;

(Note: paragraph (h) and text following were omitted.)

2. A trade mark shall not be refused registration or be

declared invalid in accordance with paragraph 1(b), (c) or

(d) if, before the date of application for registration and

following the use which has been made of it, it has

acquired a distinctive character. Any Member State may

in addition provide that this provision shall also apply

where the distinctive character was acquired after the

date of application for registration or after the date of

registration.

. . .

(Note that Part (b) of Article 4 of the 2017 EUTM Regulation

is new and replaces the requirement in Article 4 of the old

EUTM Regulation that the sign should be “capable of being

represented graphically.” Also new to Article 4 are the

Vol. 110 TMR 467

express references to colors and sounds, although this

change was not intended to alter the substance of the law.

The possibility of registering EUTMs without a graphical

representation (e.g., by providing a sound file for a sound

mark) became a possibility on October 1, 2017. (Similar

modifications have been made in the 2015 TM Directive,

where the relevant provisions appear in Articles 3 and

4(1)(a).)

Article 3 of the 2015 TM Directive

Signs of which a trademark may consist

A trade mark may consist of any signs, in particular words,

including personal names, or designs, letters, numerals,

colours, the shape of goods or of the packaging of goods, or

sounds, provided that such signs are capable of:

(a) distinguishing the goods or services of one

undertaking from those of other undertakings; and

(b) being represented on the register in a manner which

enables the competent authorities and the public to

determine the clear and precise subject matter of the

protection afforded to its proprietor.

Article 4 of the 2015 TM Directive

Absolute grounds for refusal or invalidity

1. The following shall not be registered or, if registered,

shall be liable to be declared invalid:

(a) signs which cannot constitute a trade mark;

(b) trade marks which are devoid of any distinctive

character;

indications which may serve, in trade, to designate

the kind, quality, quantity, intended purpose, value,

geographical origin, or the time of production of the

goods or of rendering of the service, or other

characteristics of the goods or services;

(d) trade marks which consist exclusively of signs or

indications which have become customary in the

current language or in the bona fide and established

practices of the trade;

(e) signs which consist exclusively of:

(i) the shape, or another characteristic, which

results from the nature of the goods themselves;

468 Vol. 110 TMR

(ii) the shape, or another characteristic, of goods

which is necessary to obtain a technical result;

(iii) the shape, or another characteristic, which gives

substantial value to the goods;

(f) trade marks which are contrary to public policy or to

accepted principles of morality;

(g) trade marks which are of such a nature as to deceive

the public, for instance, as to the nature, quality or

geographical origin of the goods or service;

(h) trade marks which have not been authorised by the

competent authorities and are to be refused or

invalidated pursuant to Article 6ter of the Paris

Convention;

(i) trade marks which are excluded from registration

pursuant to Union legislation or the national law of

the Member State concerned, or to international

agreements to which the Union or the Member State

concerned is party, providing for protection of

designations of origin and geographical indications;

(j) trade marks which are excluded from registration

pursuant to Union legislation or international

agreements to which the Union is party, providing for

protection of traditional terms for wine;

(k) trade marks which are excluded from registration

pursuant to Union legislation or international

agreements to which the Union is party, providing for

protection of traditional specialities guaranteed;

(l) trade marks which consist of, or reproduce in their

essential elements, an earlier plant variety

denomination registered in accordance with Union

legislation or the national law of the Member State

concerned, or international agreements to which the

Union or the Member State concerned is party,

providing protection for plant variety rights, and

which are in respect of plant varieties of the same or

closely related species.

2. A trade mark shall be liable to be declared invalid where

the application for registration of the trade mark was

made in bad faith by the applicant. Any Member State

may also provide that such a trade mark is not to be

registered.

3. Any Member State may provide that a trade mark is not

to be registered or, if registered, is liable to be declared

invalid where and to the extent that:

Vol. 110 TMR 469

(a) the use of that trade mark may be prohibited

pursuant to provisions of law other than trade mark

law of the Member State concerned or of the Union;

trade marks which are devoid of any distinctive

character;

(b) the trade mark includes a sign of high symbolic value,

in particular a religious symbol;

escutcheons other than those covered by Article 6ter

of the Paris Convention and which are of public

interest, unless the consent of the competent

authority to their registration has been given in

conformity with the law of the Member State.

4. A trade mark shall not be refused registration in

accordance with paragraph 1(b), (c) or (d) if, before the

date of application for registration, following the use

which has been made of it, it has acquired a distinctive

character. A trade mark shall not be declared invalid for

the same reasons if, before the date of application for a

declaration of invalidity, following the use which has

been made of it, it has acquired a distinctive character.

5. Any Member State may provide that paragraph 4 is also

to apply where the distinctive character was acquired

after the date of application for registration but before

the date of registration.

C. Cases

1. EU—CJEU—Must marks consisting of a

combination of colors systematically specify the

spatial arrangement of such colors to be considered

sufficiently precise?

Red Bull GmbH v. EUIPO

considered the appeal to the CJEU

by the well-known energy drink manufacturer Red Bull. The

appellant had successfully registered two EU trademarks, one in

2005 and another one in 2011, for the combination of blue and silver

in class 32 (energy drinks), as reproduced below:

The description for the first mark specified that: “Protection is

claimed for the colours blue (RAL 5002) and silver (RAL 9006). The

Case C-124/18 P (CJEU, July 29, 2019) (EU:C:2019:641).

470 Vol. 110 TMR

ratio of the colours is approximately 50%–50%.” The description for

the second mark specified that the colors blue (Pantone 2747C) and

silver (Pantone 877C) “will be applied in equal proportion and

juxtaposed to each other.”

In September 2013 a Polish company, Optimum Mark, filed

applications with the EUIPO for a declaration of invalidity for both

marks.

Optimum Mark contended that the first mark did not meet the

requirements of Article 7(1)(a) of the 2017 EUTM Regulation, as its

representation did not systematically arrange the colors by

associating them in a predetermined and uniform way.

Additionally, it argued that the description of the mark, according

to which the ratio of the two colors of which the mark was composed

was “approximately 50%–50%,” allowed for numerous

combinations, with the result that consumers would not be able to

make further purchases with certainty.

In respect of the second mark, Optimum Mark contended that it

also did not meet the requirements of Article 7(1)(a) of the 2017

EUTM Regulation and, as the term “juxtaposed” might have several

meanings, the description of the mark did not indicate the type of

arrangement in which the two colors would be applied to the goods

and was therefore not self-contained, clear, and precise.

The Cancellation Division of the EUIPO declared the two marks

in question invalid in two separate proceedings,

inter alia, on the

ground that their representation was not sufficiently precise. Red

Bull appealed these decisions to the First Board of Appeal of the

EUIPO, which dismissed the appeals in their entirety.

Upon Red Bull’s subsequent appeal to the General Court for the

decisions to be annulled, the General Court also dismissed the

actions in their entirety, noting in particular that the lack of

precision of the two graphic representations of the marks, together

with their descriptions, was confirmed by the fact that the

appellant’s applications for registration were accompanied by

evidence that reproduced those marks very differently in

comparison with the vertical juxtaposition of the two colors shown

in the graphic representations included in those applications. Red

Bull to appealed to the CJEU.

The appellant submitted five grounds in support of its appeal,

alleging, first, breach of the principles of equal treatment and

proportionality; second, infringement of Article 4 and Article 7(1)(a)

of the 2017 EUTM Regulation; third, breach of the principle of

legitimate expectations; fourth, breach of the principle of

proportionality; and, lastly, infringement of Article 134(1) and

Article 135 of the Rules of Procedure of the General Court.

Case T-101/15 and Case T-102/15, respectively.

Vol. 110 TMR 471

The CJEU’s analysis focused on the appellant’s second ground

of appeal, namely infringement of Article 4 and Article 7(1)(a) of the

2017 EUTM Regulation. Red Bull submitted that the General Court

had misinterpreted the judgment in Heidelberger Bauchemie

and

infringed Article 4 and Article 7(1)(a) of the 2017 EUTM Regulation

by holding that marks consisting of a combination of colors must

systematically specify the spatial arrangement of the colors in

question, concluding that the graphic representation of the marks

at issue was insufficiently precise without such an arrangement.

In particular, Red Bull contended that Heidelberger Bauchemie

should be interpreted in the specific context of the case that gave

rise to that judgment, which concerned a trademark consisting of a

combination of colors and whose description stated that those colors

were to be used “in every conceivable form.” Further, by considering

that the mere juxtaposition of colors was not sufficient to constitute

a precise and uniform graphic representation, the General Court

had failed to consider that a trademark must be viewed as filed, as

per the CJEU decision in Apple.

As such, the General Court had

failed to consider the specific feature of marks consisting of a

combination of colors, which is not to have contours.

In its judgment, the CJEU noted that it is clear from earlier case

law that a sign may be registered as a mark only if the applicant

provides a graphic representation in accordance with the

requirements in Article 4 of the 2017 EUTM Regulation, to the effect

that the subject matter and scope of the protection sought are

clearly and precisely determined. Where an application is

accompanied by a verbal description of the sign, such description

must be evaluated in combination with the graphic representation,

and must serve to clarify the subject matter and scope of the

protection sought under trademark law; it cannot be inconsistent

with the graphic representation of a trademark or give rise to doubts

as to the subject matter and scope of that graphic representation.

Furthermore, in Heidelberger Bauchemie, the CJEU held that a

graphic representation of two or more colors, designated in the

abstract and without contours, must be systematically arranged in

such a way that the colors concerned are associated in a

predetermined and uniform way. It also noted that the mere

juxtaposition of two or more colors, without shape or contours, or a

reference to two or more colors “in every conceivable form,” will not

exhibit the qualities of precision and uniformity required by Article

4. The Court elaborated that such representations would allow

numerous different combinations, which would not permit the

consumer to perceive and recall any particular combination, thereby

Heidelberger Bauchemie, Case C‑49/02 (EU:C:2004:384).

Apple Inc. v. Deutsches Patent- und Markenamt, Case C‑421/13 (EU:C:2014:2070).

Hartwall, Case C‑578/17 (EU:C:2019:261).

472 Vol. 110 TMR

failing to enable them to make further purchases with certainty.

Similarly, the competent authorities and economic operators would

not know the scope of the protection afforded to the proprietor of the

trademark in question.

Therefore, contrary to Red Bull’s arguments, requiring a mark

consisting of a combination of colors to display a systematic

arrangement associating the colors in a predetermined and uniform

way cannot transform that type of mark into a figurative mark,

since that requirement does not mean that the colors must be

defined by contours.

Red Bull could not rely on the CJEU judgment in Apple in

support of its claim that the General Court had erred in holding that

the graphic representation of the marks at issue was insufficiently

precise. The case that gave rise to that judgment concerned graphic

representation of “a collection of lines, curves and shapes,” which

was not applicable here.

In light of these considerations, the CJEU concluded that the

General Court had correctly applied Article 4 and 7(1)(a) of the 2017

EUTM Regulation. The General Court was right to consider that the

description of the marks could result in numerous combinations

with respect to the arrangement of the two colors. Marks that allow

for a plurality of reproductions that are neither determined in

advance nor uniform are incompatible with the 2017 EUTM

Regulation.

2. EU—CJEU—Was an EUTM relating to

asset management non-distinctive and

descriptive in respect of class headings only or

for all services for which it is registered?

In VM Vermögens-Management GmbH v. EUIPO,

the CJEU

considered an appeal by VM Vermögens-Management (“VM”) to set

aside the decision of the General Court relating to invalidity

proceedings against a word mark. In December 2009, VM filed an

application for registration of an EU trademark with the EUIPO for

the mark VERMÖGENSMANUFAKTUR in classes 35 and 36 of the

Nice Agreement. The word Vermögensmanufaktur is a combination

of German words Vermögen, meaning “assets,” and Manufaktur,

meaning “manufacture.”

The mark was registered on May 18, 2011, but the intervener at

first instance, DAT Vermögensmanagement, filed an application for

a declaration of invalidity on July 30, 2012, for all services for which

it was registered. In December 2013, the Cancellation Division

rejected the application.

Case C-653/17 P (CJEU, May 15, 2019) (EU:C:2019:406).

Vol. 110 TMR 473

On appeal, the Fifth Board of Appeal overturned the

Cancellation Division’s decision and held that the contested mark

was descriptive and devoid of distinctive character under

Articles 7(1)(b) and 7(1)(c) of the 2009 EUTM Regulation.

The

contested mark was declared invalid for the services in classes 35

and 36.

In July 2015, VM sought an appeal for annulment of the Fifth

Board of Appeal’s decision at the General Court. A couple months

after the action was brought, VM had filed a declaration under

Article 28(8) of the 2009 EUTM Regulation, as amended by the 2015

EUTM Regulation. The purpose of this declaration was, following

the CJEU’s decision in the IP Translator

case for the EUIPO to

interpret Nice Class headings literally, to specify the services that

it had intended to cover at the time of the application for

registration of the contested mark and seek protection for services

beyond those covered by the literal meaning of classes 35 and 36 of

the Nice Agreement. Accordingly, VM’s declaration specified certain

additional services to be designated by the contested mark in classes

35 and 36 of the Nice Agreement, and the new list of services of the

contested mark was published in the European Trademarks

Bulletin in November 2016.

The appeal to the General Court mainly focused on VM’s

arguments that the Fifth Board of Appeal had wrongly concluded

that the contested mark was descriptive and devoid of distinctive

character, but VM had also argued that, in the alternative, the Fifth

Board of Appeal’s decision should apply only to the services in

classes 35 and 36 in its original application and not those that were

added by the Article 28(8) declaration. The General Court dismissed

the appeal in its entirety.

VM put forward six grounds of appeal before the CJEU. The first

two grounds of appeal related to the Article 28(8) declaration. VM

had argued that the General Court had misconstrued the effect of

the declaration by refusing to recognize that, by virtue of the

retrospective effect of the amendment of the EU trademarks

was invalid only for the services covered by the literal meaning of

the heading of classes 35 and 36. The CJEU agreed that VM’s

Article 28(8) declaration was not intended to add any new services

to the scope of protection but was only to ensure that the services

covered by that declaration continued to enjoy such protection, even

though they were not clearly covered by the literal meaning of the

These provisions are now found at Article 7(1)(b) and 7(1)(c) of the 2017 EUTM

Regulation.

Chartered Institute of Patent Attorneys v. Registrar of Trade Marks, Case C-307/10

(CJEU, June 19, 2012) (EU:C:2012:361).

474 Vol. 110 TMR

indications included in the headings of classes 35 and 36 of the Nice

Agreement.

As a result, although the Fifth Board of Appeal’s decision was

made before VM had filed its Article 28(8) declaration, the decision

to invalidate the contested mark would cover all services for which

the trademark was registered including such services covered by

that declaration.

By its third ground of appeal, VM argued that the General Court

had infringed Article 7(1)(c) of the 2009 EUTM Regulation in finding

that the contested mark was descriptive. According to VM, the word

Vermögensmanufaktur would have only triggered, in the relevant

public, a process of reflection and would not be directly linked to

individual high-quality services. However, as VM had not pleaded

any distortion of the facts or evidence, the CJEU found this ground

of appeal inadmissible on the basis that VM had merely disputed

the General Court’s findings of fact in relation to the perception of

the trademark and its descriptive character, rather than argue an

error on a point of law. The General Court’s decision was also

upheld, having considered that the public was able to understand

the meaning of the German words Vermögen and Manufaktur and

that the combination of those two words had a clear and

unambiguous meaning.

The fourth ground of appeal centered around the General

Court’s misapplication of Article 7(1)(b) of the 2009 EUTM

Regulation for concluding that the contested mark was devoid of

distinctive character. The General Court had considered that the

trademark was not sufficiently unusual, original, or resonant,

therefore the relevant public would not be able to distinguish the

services provided by VM from those provided by others in the same

sector. In its appeal, VM cited the CJEU judgment in Audi v.

OHIM,

where it was held that the existence of such characteristics

is not a necessary condition for establishing the distinctive

character of a laudatory reference. The CJEU considered this

ground of appeal unfounded as it was based on a misreading of the

General Court’s judgment, which was not just based on the

laudatory character of the mark.

In its ruling, the CJEU agreed with the General Court’s

observations that a trademark that is descriptive within the

meaning of Article 7(1)(c) is devoid of any distinctive character.

However, just because a trademark is not deemed descriptive within

the meaning of Article 7(1)(c), that does not necessarily mean the

mark is accordingly distinctive. It will still be necessary for the

competent tribunal to examine whether the mark performs the

essential function of a trademark—to represent a badge of

(commercial) origin to allow a consumer who originally purchased

Case C-398/08 P (CJEU, January 21, 2010) (EU:C:2010:29), at para. 47.

Vol. 110 TMR 475

the goods or services designated by the mark to repeat (or avoid)

that experience in future transactions.

Drawing from these observations, the CJEU agreed with the

General Court’s conclusion that VM could not monopolize the

contested mark where the relevant public would not be able to

distinguish the services provided by VM from those provided by

another undertaking in the same sector. As a result, although the

CJEU had concluded that a mark can be perceived by the relevant

public both as a promotional formula and as an indication of the

commercial origin of goods or services in Audi v. OHIM,

the

contested mark in the present case would not enable a consumer of

the relevant public that acquires services from VM to purchase (or

avoid) the same services in a subsequent transaction. The contested

mark did not therefore go beyond the mere representation of

promotional information to act as a badge of commercial origin.

The remaining grounds of appeal were held to be inadmissible

as mere repetition of arguments made at first instance rather than

(alleged) errors of law by the General Court.

3. EU—CJEU—Does the concept of “shape”

as an absolute ground for refusal

cover other characteristics, such as patterns,

applied to a specific location on a

two-dimensional product?

Textilis Ltd., Ozgur Keskin v. Svenskt Tenn AB

concerned the

questions regarding Article 7(1)(e)(iii) of the 2009 EUTM

Regulation

referred to the CJEU by the Svea Court of Appeal,

Patents and Market Court of Appeal, in Sweden. The local

proceedings concerned Svenskt Tenn’s registered EUTM known as

MANHATTAN for the following figurative mark:

Id. at para. 45.

Case C‑21/18 (CJEU, March 14, 2019) (EU:C:2019:199).

This provision is now found at Article 7(1)(e)(iii) of the 2017 EUTM Regulation. This

provision has been amended by the 2015 EUTM Regulation to include signs that consist

exclusively of “the shape, or another characteristic, which gives substantial value to the

goods.”

476 Vol. 110 TMR

Registration was obtained, inter alia, in class 16 for “table cloths,

table napkins of paper; coasters of paper; wrapping paper; writing

or drawing books”, in class 24 for “textiles and textile goods, not

included in other classes; bed and table covers” and in class 35 for

“retail services connected with the sale of . . . textile fabrics, textile

products.”

In 2013, UK company Textilis began selling and marketing

fabrics and goods for interior decoration bearing patterns similar to

those of Svenskt Tenn’s registered MANHATTAN EUTM. Svenskt

Tenn brought proceedings against Textilis at the Patents and

Market Court in Sweden on the grounds of copyright and trademark

infringement. In response, Textilis had argued for the revocation of

the registered EUTM for a lack of distinctiveness under Article

7(1)(b)

and for representing a mark consisting exclusively of the

shape that gives substantial value to the goods under Article

7(1)(e)(iii) of the 2009 EUTM Regulation.

The Patents and Market Court (lower instance) dismissed the

counterclaim for revocation on the basis that pattern-like images

can be subject to trademark registration and that the mark did not

constitute a sign consisting exclusively of “the shape.” The court

ruled that Textilis had infringed Svenskt Tenn’s trademark.

Textilis sought an appeal to the Svea Court of Appeal, Patents

and Market Court of Appeal, seeking a declaration, on the basis of

Article 7(1)(e)(iii), that the registered EUTM was invalid. The Svea

Court of Appeal (Patents and Market Court of Appeal) pointed out

the difficulty in assessing the ground of invalidity as to whether it

may apply to two-dimensional marks that represented two-

dimensional goods, such as a pattern on a fabric. Another

complication for the court was the fact that the date of registration

for the EUTM and the date upon which the action was brought had

occurred prior to the amendment of Article 7(1)(e)(iii) of the 2009

EUTM Regulation by the 2015 EUTM Regulation, under which

registration is refused not only for signs consisting exclusively of

This provision is now found at Article 7(1)(b) of the 2017 EUTM Regulation.

Vol. 110 TMR 477

“the shape” but also “another characteristic of the goods.” An

interesting consideration was posed as to whether this amendment

alters the assessment to be made by virtue of that ground of

invalidity to look beyond simply “the shape,” which had previously

been discussed by the General Court in Bang & Olufsen A/S

years

before the 2017 EUTM Regulation came into force.

The Court of Appeal decided to stay the proceedings and refer

three questions to the CJEU, two of which are set out below:

1. Is Article 4 [of the 2015 EUTM Regulation] to be

interpreted as meaning that Article 7(1)(e)(iii) [of the

2017 EUTM Regulation], in its new wording, is

applicable to a court’s assessment of invalidity (under

Article 52(1)(a) of the Trade Marks Regulation) that is

made after the entry into force of the amendment,

namely after 23 March 2016, even if the action concerns

a declaration of invalidity where the action was brought

before that date and therefore concerns a trade mark

registered before that date?

2. Is Article 7(1)(e)(iii) [of the 2009 EUTM Regulation], in

the version applicable, to be interpreted as meaning that

its scope covers a sign which consists of the two-

dimensional representation of a two-dimensional

product, for example, fabric decorated with the sign in

question?

In providing its response to the first question, the CJEU had

considered the necessity to observe the principles of legal certainty

and the protection of legitimate expectations. Citing Bureau

national interprofessionnel du Cognac,

the CJEU explained that

EU law will only have retroactive effect prior to its entry into force

where it follows from their “terms, objectives or general scheme that

such effect must be given to them.” As no express provision of such

was contained in the 2015 EUTM Regulation, it was held that

Article 7(1)(e)(iii), as amended, is not applicable to marks registered

before its entry into force and therefore did not apply to the present

case.

The CJEU had considered the judgment of Louboutin and

Christian Louboutin,

a case relating to whether the concept of “the

shape” under the 2008 TM Directive was limited solely to three-

dimensional properties of a product or if it covered other

characteristics such as color, in formulating its response to the

second question. It applied the definition given to the concept of

Case T-508/08 (GC, October 6, 2011) (EU:T:2011:575).

Case C-4/10 and C-27/10 (CJEU, July 14, 2018) (EU:C:2011:484).

Case C-163/16 (CJEU, June 12, 2018) (EU:C:2018:423).

478 Vol. 110 TMR

“shape” in Article 3(1)(e)(iii) of the 2008 TM Directive, whose

wording is similar to that of Article 7(1)(e)(iii) of the 2009 EUTM

Regulation, as being “usually understood as a set of lines or contours

that outline the product concerned”

to the present case. While the

European Commission had pointed out in its observations that the

MANHATTAN mark at issue contains lines and contours, the CJEU

held that the sign cannot be regarded as consisting “exclusively of

the shape” within the meaning of Article 7(1)(e)(iii) of the 2009

EUTM Regulation.

The CJEU noted that, although the sign represents shapes that

are formed by the external outline of drawings representing stylized

parts of geographical maps, it is clear that the sign also “contains

decorative elements situated both inside and outside those

outlines,” including words such as “MANHATTAN.” Thus, a sign

consisting of two-dimensional decorative motifs is not

“indissociable” from the shape of the goods where that sign is affixed

to goods whose form differs from such decorative motifs.

The third question referred to the CJEU queried the

interpretation of Article 7(1)(e)(iii) where the registration covers a

wide range of classes of goods and the sign may be affixed in

different ways to the goods. This question was subject to the CJEU

responding to the second question in the affirmative, and the CJEU

subsequently considered it unnecessary to provide a response.

The list of characteristics that do not fall within the concept of

“the shape” continues to expand, as this ruling confirms that the

CJEU recognizes neither patterns nor colors applied to a specific

location of a product as falling under the scope of the definition.

4. EU—General Court—Does a figurative trademark

consisting of “3 parallel equidistant stripes of

identical width applied on the product in

any direction” have distinctive character?

Adidas AG v. EUIPO/Shoe Branding Europe BVBA

concerned

the well-known sportswear brand Adidas and its EU trademark,

registered for clothing, footwear and headgear in class 25, as

depicted below.

Id. at para. 21.

Case T-307/17.

Vol. 110 TMR 479

In the original application for registration, the mark was

identified as a figurative mark with the following description: “The

mark consists of three parallel equidistant stripes of identical width,

applied on the product in any direction.”

In 2014, a Belgian footwear company, Shoe Branding Europe

BVBA (“Shoe Branding”) filed an application for declaration of

invalidity. In 2016, the Cancellation Division of the EUIPO granted

the application for a declaration of invalidity on the basis that the

mark was devoid of distinctive character. The mark lacked inherent

distinctiveness and Adidas had failed to establish that the mark had

acquired distinctive character through its use in the EU. Appealing

to the Second Board of Appeal of the EUIPO, Adidas argued that

while it did not dispute the lack of inherent distinctiveness of the

mark, the mark had, contrary to the decision of the Cancellation

Division, acquired distinctive character through use within the

meaning of Article 7(3) and Article 52(2) of the 2009 EUTM

Regulation (now Article (7(3) and Article 59(2) of the 2017 EUTM

Regulation). The Board of Appeal dismissed the appeal.

Before the General Court, Adidas argued a breach of Article

52(2) (read in conjunction with Article 7(3)) of the 2009 EUTM

Regulation and the principles of the protection of legitimate

expectations and proportionality. Adidas argued that the Board of

Appeal, in dismissing certain parts of its evidence, misinterpreted

the mark at issue and misapplied the “law of permissible

variations.” Adidas also contended that the Board of Appeal erred

in its assessment that the mark had not acquired distinctive

character following the use that had been made of it in the EU.

The appeal involved an assessment as to the nature of the mark

depicted on the register and its proper interpretation. Adidas

maintained that the mark was a “surface pattern,” to be reproduced

in different dimensions and proportions depending on the goods on

which it was applied. It had not, as the Board of Appeal had decided,

been a mark claimed only in relation to specific dimensions. Relying

on the EUIPO’s examination guidelines and the legitimate

expectations that follow from those guidelines, Adidas argued that

the mark at issue was a “pattern mark” and therefore the sole

function of the graphical representation of the mark was to show a

480 Vol. 110 TMR

design consisting of three parallel equidistant stripes, regardless of

specific dimensions. The General Court dismissed this argument on

the basis that it was not apparent from the graphical representation

of the mark or its description that it was composed of a series of

regularly repetitive elements and could not therefore be considered

a “pattern” under the EUIPO guidelines.

In interpreting the nature of the mark as registered, the General

Court considered first the graphical representation of the mark. The

General Court noted that the mark had been registered as a

figurative mark consisting of “three vertical, parallel, thin black

stripes against a white background, whose height is approximately

five times the width.” The General Court agreed with the Board of

Appeal that there was a ratio of around 5 to 1 between the total

height and width of the mark at issue and an equal thickness of the

three parallel black stripes and the two white spaces between those

stripes. The General Court confirmed that the Board of Appeal had

not actually held that the mark had been claimed in specific

dimensions but that in any event, Adidas had not provided any

concrete evidence to support its argument that the protection of the

mark consisted of the use of three parallel equidistant stripes,

irrespective of their length or the way in which they were cut. It

followed that their argument in respect of misinterpretation of the

mark at issue failed.

The General Court turned next to the allegation of

misapplication of the “law of permissible variations.” Adidas

contended that the Board of Appeal incorrectly held that: (i) where

a trademark is extremely simple, even a slight difference could lead

to a significant alteration to the characteristics of the mark as it had

been registered; (ii) use of the mark at issue in the form where the

color scheme is reversed necessarily alters the distinctive character

of that mark; (iii) some of the evidence showed a sign with two

instead of three stripes and; (iv) the use of sloping stripes altered

the distinctive character of that mark.

In relation to the “extremely simple character of the mark,”

Adidas argued that given the use of the mark in different forms

(from the form in which the mark was registered) did not alter the

distinctive character of the mark, it was therefore “use” of the mark

at issue. Adidas submitted that the concept of “use” of a mark should

be interpreted in the same way as the concept of “genuine use.” In

contrast, Shoe Branding argued that the concept of “use” within the

meaning of Article 7(3) and Article 52(2) of the 2009 EUTM

Regulation is narrower than that of “genuine use” in Article 15(1) of

that regulation. Therefore, in order to prove acquired

distinctiveness, Adidas could rely only on the use of the mark such

as it was registered (only taking into account insignificant changes).

Agreeing with Shoe Branding, the General Court held that where a

trademark is extremely simple (as was the case here), even minor

Vol. 110 TMR 481

alterations to that mark may constitute significant changes; the

more simple the mark, the less likely it is to have a distinctive

character and the more likely it is for an alteration to that mark to

affect its essential characteristics.

As for the consequences of a reversed color scheme, Adidas

contended that the mark at issue was registered in black and white

but without a particular color claim. It followed that (contrary to the

decision of the Board of Appeal) use of the mark in the form where

the color scheme is reversed (i.e., white stripes against a black

background) did not affect the distinctiveness of the mark. Further,

Adidas submitted that the Board of Appeal’s decision was contrary

to the approach taken by German and French courts and was at

odds with a previous decision of the Board of Appeal. In that

decision, the Board of Appeal had held that another Adidas mark,

representing white stripes and a black background, could be applied

on products in the shape of a black rectangle containing white

stripes.

Dismissing Adidas’s argument, the General Court confirmed

once again that the EU trademark regime applies independently to

any national system.

Moreover, the examination undertaken in

each case depends on specific criteria that are applicable to the

individual factual circumstances of a case.

Adidas could not rely

on a separate decision of the Board of Appeal to allege inconsistency

by the EUIPO and, in any event, that decision had been annulled.

The General Court concluded that owing to the extreme simplicity

of the mark at issue, the act of reversing the color scheme would

show another sign consisting of three white stripes against a black

background as opposed to the mark at issue. Agreeing with the

Board of Appeal, the evidence submitted by Adidas, being images of

clothing, footwear, and accessories with a reversed color scheme, did

not show genuine use of the mark. Therefore, Adidas’s plea for

infringement of the “law of permissible variations” had to be

rejected.

In submitting its final plea, Adidas alleged that the Board of

Appeal had erred in finding that Adidas had not shown that the

mark at issue had acquired distinctive character within the EU.

Adidas argued that a global assessment of the evidence should have

been carried out, irrespective of the color and length of the stripes.

Adidas contended that the large body of evidence supplied in respect

of the whole of the EU showed use of the registered “mark with three

parallel equidistant stripes’ and recognition of the mark by the

adidas v. Shoe Branding Europe BBVA, Case R 1208/2012-2.

Develey v. OHIM, Case C-238/06 P (EU:C:2007:635).

Agencja Wydawnicza Technopol v. OHIM, C-51/10 P (EU:C:2011:139).

adidas v. OHIM—Shoe Branding Europe (Two parallel stripes on a shoe), Case T-145/14,

not published (EU:T:2015:303).

482 Vol. 110 TMR

relevant public as originating from Adidas. The General Court

dismissed this plea.

In assessing acquired distinctiveness, the General Court

reiterated that factors such as: (i) market share; (ii) widespread and

long-standing use; (iii) promotion of the mark; (iv) the proportion of

the relevant public; and (v) industry opinions may be taken into

account.

The evidence provided by Adidas could be grouped into

four categories, namely: (i) images (ii) turnover and marketing and

advertising figures; (iii) market surveys; and (iv) other evidence.

The General Court dismissed the majority of the images provided

by Adidas as irrelevant on the basis that they related to signs that

were not in the registered form of the mark at issue. Similarly, the

General Court observed that it could not establish a link between

the very high turnover and advertising figures provided and the

specific mark at issue. With respect to the other evidence provided

by Adidas, including previous judgments and press cuttings, the

General Court noted that Adidas did not make clear which

judgments and news articles challenged the Board of Appeal’s

assessment.

The General Court confirmed that the only relevant evidence

provided by Adidas related to five market surveys (but which

covered only five Member States of the EU). Rejecting Adidas’s

submissions that the same types of evidence do not have to be

provided in respect of each Member State,

the General Court held

that Adidas had not produced any relevant evidence in respect of

the 23 other Member States at all. Specifically, the General Court

confirmed that Adidas had not shown any reason to conclude that

the domestic markets of the five Member States in which the

surveys were carried out were comparable to the national markets

of the other 23 Member States (either as a result of effective

distribution networks or other marketing strategies).

As a result, the General Court concluded that a global

assessment of the evidence submitted by Adidas did not establish

use of the mark at issue in the EU and was not sufficient to prove

that the mark at issue had come to distinguish the goods for which

it was registered from those of other undertakings. The Board of

Appeal had not committed an error of assessment, and the action

was dismissed in its entirety.

Windsurfing Chiemsee, Case C-108/97 and Case C-109/97 (EU:C:1999:230).

BCS v. OHIM—Deere (combination of the colors green and yellow), Case T-137/08

(EU:T:2009:417).

Vol. 110 TMR 483

5. EU—General Court—Must the shape of a

three-dimensional trademark depart

significantly from the common shape of the product

in question to have distinctive character?

Brita GmbH v. EUIPO

concerned an application to register the

shape of a faucet as a three-dimensional EU trademark by a well-

known water filter manufacturer, Brita.

On November 16, 2016, Brita applied for registration of an EU

trademark in classes 7, 11, 21, 32, 35, 37, and 40. The mark is

reproduced below:

The examiner partially rejected the application on the basis of

Article 7(1)(b) of the 2009 EUTM Regulation

on the ground that

the mark lacked distinctive character for certain goods and services

included in the application (classes 7, 11, 21, 37 and 40). As such,

the mark did not serve to identify the goods and services within

these classes as originating from Brita.

The applicant filed a notice of appeal with the EUIPO, pursuant

to Articles 58 to 64 of the 2009 EUTM Regulation (now Articles 66

to 71 of the 2017 EUTM Regulation) against the examiner’s

decision. The statement of the grounds of appeal was lodged with

the Board of Appeal on October 27, 2017.

The Fourth Board of Appeal of the EUIPO dismissed the appeal.

In agreement with the examiner, it held that the mark was devoid

of any distinctive character within the meaning of Article 7(1)(b) of

the 2009 EUTM Regulation in respect of the goods and services

[2019] Case T-213/18 (CJEU, June 19, 2019) (EU:T:2019:435).

Now found at Article 7(1)(b) of the 2017 EUTM Regulation.

484 Vol. 110 TMR

referred to above. The mark applied for was a mere representation

of a faucet for dispensing water or beverages and could not be

perceived as distinctive. Taken as a whole, the mark contained no

element that departed significantly from the standard shape of

water or beverage dispensers and which could therefore fulfil the

(essential) function of indicating origin.

Brita applied to the General Court for an annulment of this

decision, alleging an improper application of Article 7(1)(b) in that

the Board of Appeal had erred in finding that the mark lacked

distinctive character. Specifically, the applicant claimed that the

Board of Appeal erred in finding that the mark had the simple shape

of a typical device used for dispensing water on the ground that its

characteristics were very common for the usual beverage apparatus.

The General Court reemphasized that the criteria for assessing

the distinctive character of three-dimensional marks consisting of

the appearance of the product itself was no different from those

applicable to other categories of trademark.

Nevertheless, when

applying those criteria, the perception of the relevant public is not

necessarily the same, since settled case law establishes that average

consumers are not in the habit of making assumptions about the

origin of products on the basis of their shape.

In accordance with the relevant case law,

the more closely the

shape for which registration is sought resembles the shape most

likely to be taken by the product in question, the greater the

likelihood of the shape/mark being devoid of any distinctive

character (for the purposes of Article 7(1)(b)). Only a trademark that

departs significantly from the norms or customs of the sector is

deemed to have any distinctive character and is able to distinguish

commercial origin.

Further, where a three-dimensional mark constitutes the shape

of the product for which registration is sought, merely being a

“variant” of a common shape of that type of product is not sufficient

to give the mark distinctive character for the purposes of Article

7(1)(b). As always, the test of perception of distinctive character is

whether the mark sought would permit the average consumer of

that product (being reasonably well-informed, observant, and

circumspect) to distinguish the product concerned from those of

others without conducting an analytical examination and without

paying particularly close attention.

Birkenstock Sales v. EUIPO, Case C-26/17 P (EU:C:2018:714), and hoechstmass

Balzer v. EUIPO (Shape of a tape measure case), Case T-691/17, not published

(EU:T:2018:394).

Henkel v. OHIM, Case C-456/01 P and C-457/01 P (EU:C:2004:258), and Birkenstock

Sales v. EUIPO.

Voss of Norway v. OHIM, Case C-445/13 P (EU:C:2015:303) and hoechstmass

Balzer v. EUIPO, Case T-691/17 (Shape of a tape measure case).

Vol. 110 TMR 485

The General Court concluded that the Board of Appeal had

correctly analyzed all of the elements of the mark applied for and

found that, taken as a whole, the mark contained no element that

departed significantly from the standard shape of water and

beverage dispensers. There being no error of assessment in that

analysis, the Board had been correct in finding that the mark had

no distinctive character within the meaning of Article 7(1)(b). The

General Court dismissed the application in its entirety.

6. EU—General Court—Is a trademark composed

of a number of descriptive elements itself

descriptive of the characteristics of the

goods or services for which registration is sought?

United Seafoods v. EUIPO

concerned United States Seafoods

LLC’s (“USS”) international registration designating the EU for the

figurative sign UNITED STATES SEAFOODS for “fish; fish fillets”

in class 29. The EUIPO Examiner rejected the application for

registration of the sign in the EU on the basis of absolute grounds

for refusal under Article 7(1)(b) and (c) of the 2017 EUTM

Regulation, as it considered that the international registration

consisted exclusively of a sign that designated the geographical

origin of the goods. The figurative sign is reproduced below.

USS appealed to the Fifth Board of Appeal (the “Board of

Appeal”), which dismissed USS’s action. The Board of Appeal agreed

that the sign at issue was descriptive of the nature and geographical

origin of the goods concerned. In considering the different elements

of the mark, the Board of Appeal noted that the sign at issue

consisted of (i) the word element “United States Seafoods”; (ii) a

territorial shape, described by the international registration

application as the shape of the territory representing the State of

Alaska and; (iii) the flag of the United States of America including

[2019] Case T-10/19 (CJEU, October 17, 2019).

486 Vol. 110 TMR

white stars on the top left, a blue background and red and white

stripes below and to the right of the stars. The Board of Appeal held

that since the sign at issue contained English words, the relevant

public was the English-speaking public in the EU who would

ultimately “perceive that sign as referring to food obtained from the

sea coming from the United States.” USS appealed to the General

Court arguing that the Board of Appeal had incorrectly applied

Articles 7(1)(c) and 7(1)(b) of the 2017 EUTM Regulation.

In relation to Article 7(1)(c), USS submitted that while the word

element “United States Seafoods” was descriptive, the figurative

elements of the sign provided a unique and distinctive character to

the sign as a whole. Accordingly, the Board of Appeal had been

wrong to conduct a separate examination of the different elements

of the sign but should have considered the overall impression of the

sign as perceived by the relevant public. In dismissing USS’s

submissions, the General Court held that the Board of Appeal had

correctly identified the relevant public for whom the word element

of the sign would indicate foodstuffs obtained from the sea from the

United States and was therefore wholly descriptive.

The General Court confirmed that the Board of Appeal had

correctly examined all of the elements of the sign at issue to confirm

its finding, including the flag element (which held only minor

differences from the flag of the United States), the expression

“United States” and the representation of the state of Alaska. The

General Court observed that the Board of Appeal had even

described how the shape of the territory would only rarely be

perceived as such by the relevant public but merely served to

reinforce the descriptive character of the sign for that part of the

relevant public that might identify the shape correctly. The Board

of Appeal had therefore accurately assessed the sign at issue and

found that it was descriptive for the purposes of Article 7(1)(c) of the

2017 EUTM Regulation.

The General Court observed that since it is sufficient for one of

the absolute grounds for refusal to apply in order for a sign not to be

registrable as an EU trademark, there was no need to consider the

merits of USS’s second plea alleging infringement of Article 7(1)(b)

at all.

7. EU—General Court—Should the

internal mechanics of a shape be considered

when determining whether that shape is necessary

to obtain a technical result?

Rubik’s Brand Ltd. v. EUIPO

concerned the “Rubik’s Cube” (a

well-known combination puzzle) and its associated EU trademark

Case T-601/17.

Vol. 110 TMR 487

for the shape of a cube in respect of “three-dimensional puzzles” in

class 28. Following the 2016 judgment of the CJEU and the return

of the case to the EUIPO, the General Court issued its second ruling

in relation to the trademark reproduced below.

In 2006, a German toy manufacturer, Simba Toys GmbH & Co.

KG (“Simba”), applied to the EUIPO for a declaration of invalidity

on the basis that the rotating capabilities of the shape provided a

technical solution and the shape could not, therefore, be protected

as an EU trademark under Article 51(1)(a) of Regulation No. 40/04

(now Article 59(1)(a) of the 2017 EUTM Regulation) and Article

7(1)(a) to (c) and (e) of the 2017 EUTM Regulation.

The Cancellation Division of the EUIPO dismissed Simba’s

application in its entirety and the toy manufacturer appealed to the

Second Board of Appeal of the EUIPO in 2008. In dismissing the

appeal, the Board of Appeal re-emphasized the existing case law

that the examination of a trademark must be on the basis of the

mark as filed and not by reference to any alleged “invisible”

features. In the present case, the representation of the trademark

consisted of “three perspectives of a 3 x 3 x 3 cube, where each

square face [was] separated from neighboring faces by a black

contour.” The Board of Appeal confirmed that this representation

did not refer to any particular function and did not provide any

“clues” to the puzzle.

Simba appealed to the General Court in 2009, seeking

annulment of the EUIPO’s decision.

The General Court denied the

appeal, finding that the cube shape did not involve a technical

function such that it was precluded from trademark protection. In

particular, the General Court held that the technical (rotating)

Simba Toys v. OHM – Severn Towers (shape of a cube with surfaces having a grid

structure) Case T-450/09 (EU:T:2014:983).

488 Vol. 110 TMR

capabilities of the Rubik’s Cube shape did not form part of the

characteristics of the shape but was instead a result of internal

mechanics. The General Court confirmed that Simba’s arguments

were based on knowledge of the Rubik’s Cube puzzle, as opposed to

the characteristics of the shape as presented in the trademark

registration. Specifically, the General Court observed that

considering the internal rotating mechanisms of the cube would not

comply with the requirements of objectivity and certainty towards

the shape as presented.

On appeal to the CJEU in 2015, the General Court’s decision

was overturned.

The CJEU confirmed that the EUIPO and the

General Court had incorrectly dismissed the invisible elements of

the shape in determining whether the trademark involved a

technical solution. Specifically, the CJEU noted that in most

circumstances, an assessment of the functional characteristic of a

sign cannot be carried out solely on the basis of its graphical

representation, and all relevant material (including non-visible

mechanism) must be considered.

Therefore, the General Court had

interpreted Article 7(1)(e)(ii) of the Regulation too narrowly.

Following the CJEU’s judgment, the case was remitted to the

EUIPO to render a new decision on the matter.

Therefore, the EUIPO considered the case again in 2017. Taking

the view of “a reasonably discerning observer,” the EUIPO held that

there were three essential characteristics related to the shape: (i)

the actual shape of the cube; (ii) the black lines and the squares on

each face of the cube; and (iii) the different colors on each face of the

cube. In considering whether each of those essential characteristics

were necessary to obtain a technical result, the EUIPO considered

that it was. The EUIPO confirmed that each of those essential

characteristics added to the technical result of “axially rotating,

vertically and horizontally, rows of smaller cubes of different colors

which are part of a large cube until the nine squares of each face of

that cube show the same color.” The EUIPO observed that since this

was the purpose of the Rubik’s Cube puzzle, the trademark had been

registered in breach of Article 7(1)(e)(ii) of the Regulation. The case

was once again appealed to the General Court.

The General Court first considered the different colors of the

cube and held that the EUIPO’s assessment of the shape had been

incorrect by determining that the different colors constituted an

essential characteristic of the trademark. The General Court

observed that the owners of the Rubik’s Cube, on registering the

trademark, had never actually claimed that the different colors

constituted any part of the trademark. In addition, the trademark

Simba Toys v. EUIPO, Case C-30/15 P (EU:C:2016:849).

Philips, Case C-299/99 (EU:C:2002:377).

Case R 452/2017-1.

Vol. 110 TMR 489

registration did not itself present the existence of different colors on

each face of the cube.

Next, the General Court turned to the black lines and squares

on each face of the cube “which intersect, horizontally and vertically,

on each of the faces of the cube, dividing each of them into nine small

cubes of equal size divided into rows of 3 x 3.” The General Court

held that the black lines provided a physical separation between the

small cubes to allow consumers to rotate each row, without which

the Rubik’s Cube would simply be a solid block. The General Court

reiterated that the purpose of the puzzle was to allow players to

generate six different colored faces by independently rotating rows

of the smaller cubes. The General Court agreed with the EUIPO

that it was as a result of the black lines and the squares that this

purpose was achieved. The General Court therefore held that the

essential characteristic of the black lines was necessary to obtain

the intended technical result of the shape. Lastly, in respect of the

overall shape of the cube the General Court rejected the applicant’s

argument that alternative geometrical shapes were capable of

achieving the same intended technical result. The General Court

held that the cube shape was “inseparable on the one hand from the

grid structure which consists of the black lines that intersect on each

of the faces of the cube” and on the other hand from the function of

the actual puzzle. The cube was therefore necessary to achieve the

intended result.

Despite the fact that the different colors did not constitute an

essential characteristic of the shape at issue, the General Court

concluded that the two remaining characteristics were necessary to

obtain the intended result of the Rubik’s Cube product for which the

shape was registered. As a result, the shape could not be validly

registered as an EU trademark.

8. The Netherlands—Supreme Court—

Shape trademarks—What is the relevance of

alternatives to achieve the same technical result?

The decision of the Dutch Supreme Court in Capri Sun v. Riha

of June 28, 2019, considered that despite the judgment of the CJEU

in Doceram,

the existence of alternatives by which the same

technical outcome can be achieved is not relevant when assessing

the invalidity of a shape trademark for a technical function.

Capri Sun is the owner of the below shape trademark in Benelux

(and elsewhere) relating to the shape of a soft drink container.

Dutch Supreme Court, June 28, 2019, ECLI:NL:HR:2019:1043 (Capri Sun/Riha).

CJEU, March 8, 2013, Case C- C‑395/16, ECLI:EU:C:2018:172 (Doceram).

490 Vol. 110 TMR

Capri Sun sued its competitor Riha for infringement of this mark

in relation to the use of a similar container. Riha counterclaimed

that the trademark relied upon was invalid because its essential

characteristics were all necessary to obtain a technical result. The

District Court rejected Capri Sun’s claims and, in the counterclaim,

held the trademark invalid. On appeal, the Court of Appeal

confirmed this decision. It considered that the packaging has

several practical/functional advantages. Because of the (more or

less) rectangular shape and the even division of its contents when

lying, it can be placed efficiently in a lunch box; and when used it

can be placed upright using a straw, limiting spillage. The size of

the container is such that it is suitable for the target consumers

(mostly children). The shape furthermore made it relatively stable,

an important quality in a drink container.

With reference to the well-established authority in Philips v.

Remington,

the Dutch Supreme Court considered that a sign

consisting exclusively of the shape of a product is invalid if all of the

essential functional features of that shape are attributable only to

the technical result. Where this was the case, this ground of

invalidity could not be overcome by establishing that there are other

shapes that allow the same technical result to be obtained.

The Dutch Supreme Court also considered that the

circumstances considered by the CJEU in Doceram

in which the

existence of alternative designs by which the same technical

function can be accomplished can be taken into account is limited to

design law only and was not relevant for the present case. The

Dutch Supreme Court emphasized that trademark law and design

law differ both in terms of purpose and duration of protection, while

the nature of the functionality exceptions also differ (being a ground

for invalidity in trademarks, merely a limitation on the scope of

protection in designs). Even more importantly, the CJEU’s decision

in Doceram considered how one should establish if an element is

solely determined by technical function, not whether (once

CJEU, June 18, 2002, Case C-299/99, ECLI:EU:C:2002:377 (Philips/Remington).

CJEU March 8, 2013, Case C- C‑395/16, ECLI:EU:C:2018:172 (Doceram).

Vol. 110 TMR 491

established) the exclusion should be applied or not, if there are

sufficient alternative ways of achieving that technical function.

9. Netherlands—Amsterdam Court of Appeal—

Shape trademarks—Shapes relating to the

nature of the goods as such

The judgment of the Court of Appeal of Amsterdam in

Hauck/Stokke

of February 5, 2019, determined that a trademark

consisting of the shape of a child’s chair (as below) results from the

nature of the goods and is therefore invalid in light of Article 2.1(2)

Benelux Convention on Intellectual Property.

The underlying case is well known to EU trademark

practitioners, having been referred to the CJEU in an earlier stage,

following which in 2014 the CJEU held that the nature of the goods

exclusion referred to above may apply to a sign that consists

exclusively of the shape of a product with one or more essential

characteristics that are inherent to the generic function or functions

of that product and that consumers may be looking for in the

products of competitors.

Following the CJEU decision, the Dutch

Supreme Court rendered a judgment in which it referred the case to

the Court of Appeal of Amsterdam to decide the case on the facts.

Applying the CJEU ruling, the Court of Appeal considered that

the chair in question had an attractive appearance because of its

design and that the shape (in particular the use of slanting

standards in which all elements of the chair are incorporated, as

well as the L-shape) to a large extent determined the functional

characteristics of the chair. It thus does not concern decorative

elements that are not inherent to the generic function or functions

of that product and that play an important or essential role in the

design of the chair. The existence of alternative designs of children’s

chairs did not mean that the exclusion could not apply.

Court of Appeal Amsterdam, February 5, 2019 (ECLI:NL:GHAMS:2019:262)

(Hauck/Stokke).

CJEU, September 18, 2014, Case C-205/13 (ECLI:EU:C:2014:2233) (Hauck/Stokke).

492 Vol. 110 TMR

The Court of Appeal concluded that the trademark consisted

exclusively of the shape of a child’s chair with essential

characteristics that are inherent to the generic functions of that

product and that consumers may be looking for in the products of

competitors. The trademark was therefore invalid.

10. Benelux—Benelux Court of Justice—

Can an English word be entirely descriptive and

unregistrable in the Benelux for certain goods?

In THINS,

the Benelux Court of Justice considered that a

wholly descriptive word could not be registered as a trademark in

the very first judgment rendered by the Benelux Court of Justice on

the basis of its new jurisdiction to determine appeals from decisions

of the Benelux Office for Intellectual Property (“BOIP”). Previously,

appeals against BOIP decisions were not centralized: an appellant

was entitled to appeal the decision before the courts of appeal in

Brussels, the Hague, or Luxembourg. This led to some discrepancies

between the case law of these courts.

The case related to a refusal by the BOIP of an application by

food manufacturer Grupo Bimbo to register the word mark THINS

in the Benelux, for chips, crackers, cookies, and other snacks in

classes 29 and 30, pursuant to Article 2.11(1)(b) Benelux Convention

of Intellectual Property (“BCIP”), corresponding to Article 4(1)(b) of

the 2015 TM Directive.

In its reasoning, the Benelux Court of Justice underlined the

importance for all traders in that field to be free to use terms that

are merely descriptive of certain goods and services or their

characteristics. The Benelux Court of Justice held that the mark

THINS would be viewed by the relevant public as a reference to the

appearance and taste sensation of the products. Although English

is not an official language in the Benelux, the relevant public has

sufficient knowledge and understanding of this language to

understand that the meaning of the word “thins” is a reference to

the English word “thin” and associate this with the characteristics

of the goods sold under that mark. The mark THINS was thus a

purely descriptive sign in respect of the goods for which registration

was sought.

The BOIP convinced the Court that the word “thins” is used in a

common way to describe a variety of different food products that

have a thin shape. The BOIP indicated that basic searches on Google

illustrated that fact. Such results showed over a dozen different

crackers, cookies, crisps, and bread-like products offered for sale in

the Benelux with the English word “thin” prominently used on their

Case C 2018/7.

Vol. 110 TMR 493

packaging or in their name. THINS had therefore become

customary on the Benelux market in relation to such goods.

Consequently, the Benelux Court of Justice dismissed Grupo

Bimbo’s appeal and refused the registration of the trademark

THINS for goods in classes 29 and 30 on the grounds that a

trademark that consists of and refers to characteristics of the goods

is devoid of any distinctive character under article 2.11(1)(b) BCIP/

Article 4(1)(b) of the 2015 TM Directive.

11. Austria—Higher Regional Court Vienna—

Is a word mark consisting of only one letter

capable of distinguishing origin?

In the case of OLG on February 1, 2019,

the Higher Regional

Court of Vienna considered the registrability of a trademark

consisting only of the letter T.

At first instance, the Austrian Patent Office had refused the

registration of a word trademark consisting solely of the letter T for

all applied goods and services, being goods and services in classes 7

(washing and cleaning machines), 10 (medical instruments), 11

(lighting, heating, cooking devices), 12 (vehicles), 35 (planning of

events, management, analysing of data, retail services, sponsor

search), 39 (energy supply), 44 (medical and beauty services), and

45 (security services, software licensing). The Austrian Patent

Office considered that the sign T could be registered only if the sign

had acquired distinctive character. Although single letters are not

automatically precluded from registration, the sign would not be

suitable to exclusively identify a single undertaking in relation to

the goods and services for which registration was sought because

this letter was commonly used as an abbreviation or designation of

type.

The Higher Regional Court of Vienna emphasized that the

applicable principles of the Austrian Trademark Act (as consistent

with the 2008 TM Directive, now the 2015 TM Directive) provide

that signs that are devoid of distinctive character are excluded from

registration because the sign cannot fulfil the main function of a

trademark as an indication of commercial origin. A trademark is

distinctive only where it is capable of identifying the goods or

services as originating from a particular undertaking and thus

distinguishing them from those of others.

Signs that may serve to

designate the kind, quality, or intended purpose or other

characteristics of the goods or service or that are customary in the

OLG Wien February 1, 2019, 133 R 110/18a.

Government Proposal for an amendment of the Austrian Trademark Protection Act

1999, RV 1643 BlgNR 20 GP 49, 24.

494 Vol. 110 TMR

current language or in the bona fide and established practices of

trade to designate the goods or service are also excluded from

registration.

A sign is therefore unregistrable if the relevant

audience understands and interprets the meaning of the term as an

indication of the goods or services that it designates, rather than an

indication of its origin.

In the past, case law in Austria

has tended to deny the inherent

distinctiveness of letters or numbers in general, because experience

had shown that such signs are used by many undertakings to

designate certain characteristics of goods (size, variety, quality) and

are hence not inherently capable of indicating origin from a

particular undertaking. However, the CJEU has already pointed

out that the general capacity of a single letter to constitute a

trademark does not mean that the sign actually has distinctive

character in relation to a specific product or service.

Thus, the

distinctiveness of a single letter always depends on the

understanding of the audience addressed in respect of the

goods/services for which registration is sought. The fact that the

abbreviation “T” might, among others, refer to a physical unit (such

as Tesla or Ton) does not alter the fact that those units of

measurement are not descriptive in relation to the services for

which the applicant sought registration. In respect of any particular

application for registration, whether or not single letters are capable

of being registered as a trademark will depend on the specific goods

and services for which registration is applied for. The Higher

Regional Court Vienna held that the sign T could be registered as a

trademark for the goods and services applied for registration in

classes 35, 39, 44, and 45, whereas a registration for the goods and

services applied for registration in classes 7, 10, 11, and 12 would

be possible only if the sign had become distinctive in relation to the

goods or services for which registration is sought as a consequence

of the use that has been made of it. This was because the description

of services with a single letter such as T in classes 35, 39, 44, and

45 was considered unusual. Contrary to this, a description with a

single letter was more customary in relation to classes 7, 10, 11, and

12.

Art. 4, para. 1, number 4 Austrian Trademark Protection Act.

E.g., OGH 14.06.1994 4 Ob 61/94; OGH 26.09.2016 4 Ob 164/16w; OGH 25.09.2018 4 Ob

66/18m.

See CJEU, Case C-265/09 P – letter a.

Vol. 110 TMR 495

12. Germany—Federal Patent Court—

Are celebrity names as trademarks

perceived as indicating subject or source?

In its decision of February 2, 2019,

the Federal Patent Court

of Germany considered the distinctive character of a celebrity name

as a trademark in respect of data carriers, printed matter, and

publication services.

The case relates to world champion swimmer Franziska van

Almsick, well known in Germany and beyond, who had sought to

for various goods and services, including “sound, image and data

carriers” in class 9, “printed matter, journals, magazines, books” in

class 16, and “publication of printed matter” in class 41.

The German PTO rejected the application, considering that the

name lacked distinctiveness and would be perceived as the subject

matter/topic of such goods and services, rather than an indication of

their source. A lack of distinctiveness may arise even where the

personal name does not immediately associate a direct factual

reference to a particular product, an inventor or a particular style

or individual to German consumers, as it would for “Diesel”

(motors), “Wankel” (motors), “Röntgen” (X-rays), or “Stresemann” (a

particular style of semi-formal male suit with striped trousers). The

names of well-known persons may also lack distinctive character

where the relevant trade circles may understand the reference to

the name of the person concerned to be a description of the subject

matter of those goods rather than as an indication of their

commercial origin. Here, the public would associate the name

“Franziska van Almsick” as relating to that individual’s sporting

success and wider celebrity, so in the context of data carriers,

magazines, and books that name would be perceived as a title or

subject matter of such publications and would be incapable of

distinguishing origin.

The Federal Patent Court overruled the PTO’s decision,

emphasizing that personal names are one of the most traditional

means of source identification and are ordinarily distinctive as a

rule. It is only where there are special circumstances relating to the

relevant goods and services that the relevant public might perceive

the name as a description of content rather than an indication of

source. However, special circumstances have been established in

previous case law (in particular for books, periodicals, and films) in

class 16, as the name of a well-known person will often be associated

not only with that person as such but also with the success on which

that reputation is based. This might arise from the creative or

artistic achievements of writers, composers, and actors, the sporting

Case No. 27 W (pat) 519/18.

496 Vol. 110 TMR

success of athletes, the regular media appearance of a television

presenter, or the achievements and public persona of politicians and

dignitaries. Such names would lack distinctive character for printed

matter and similar media as an indication of content and subject,

not commercial source.

This approach was rejected by the Federal Patent Court. In the

assessment of the distinctive character of the name of a well-known

living individual, the customs of the relevant product sector must

also be taken into account. This includes the way in which the

relevant designations are normally used on the goods concerned,

including, in particular, the place the name is affixed. This is

because the normal use of a sign determines the public’s perception

of the sign. When a consumer encounters a sign in a place where

trademarks are usually found, they tend to regard it as an indication

of origin. Conversely, use of that name by affixation in a place not

normally associated with a source indication would more be

perceived as a descriptive use.

The Federal Patent Court emphasized that a minimum degree

of distinctiveness does not require that every possible use of the sign

is use as a trademark. It is sufficient that there are practically

significant and obvious possibilities of using the sign in such a way

that the public will perceive it as a trademark. A sign may thus be

devoid of distinctive character if, in the most probable form of use,

it is not perceived by the public as an indication of origin. The

Federal Patent Court concluded that the mark FRANZISKA VAN

ALMSICK must be assumed to be used in a manner consistent with

use as an indication of origin and assessed in that light.

Applying such notional use in the context of image, sound, and

data carriers (CD, DVD, and CD-ROMs) and printed matter (books

and periodicals), the public would be accustomed to the fact that

both the topic or subject of these products (i.e., the title of the work

and the authors, actors, directors, screenwriters, composers, or

musicians responsible for it) and the indication of origin (i.e., the

book publisher, music label production, and distribution company)

are indicated next to each other. Since such indications tend to

predominantly be found in predetermined locations on the goods,

the public is able to deduce whether it is an indication of an author,

a title, or a publisher. For example, it is common practice in the sale

of books to highlight the author and work title (including graphical

elements) and generally place them in the upper two thirds of the

book cover. The indication of origin, being the publisher’s indication,

is almost always found in a smaller font at the bottom of the book.

The same practice applies to image and sound carriers, where the

indication of origin is usually smaller than the title and the author’s

name on the front or might only be on the back of the data carrier.

Following such established practice, a consumer can be expected

to assume that the name at the bottom of the book cover will be the

Vol. 110 TMR 497

name of the person or company responsible for the publication and

not the object or theme of the product in question (even where that

name is well known for matters other than publishing). Conversely,

if that name appears in the middle of the book cover, the public will

only recognize it as the author’s name or the subject matter of the

book. It was held that similar considerations would apply in respect

of the publication services sought in class 41.

13. Ireland—Trade Mark Controller—

FINGERS mark refused registration

on basis of absolute grounds and

lack of acquired distinctiveness

On April 8, 2019,

the Irish Trade Mark Controller issued a

lengthy decision finding in favor of Mars Incorporated (“the

opponent” or “Mars”) against Cadbury UK Limited (“the applicant”

or “Cadbury”) in opposition proceedings regarding an application by

Cadbury to register the word “FINGERS” as a trademark.

In late 2011, Cadbury sought to register the word “FINGERS”

as a trademark with the Irish Patents Office in respect of

“Chocolate, confectionery (other than frozen confections) and

biscuits” in class 30. The mark was filed and published on the basis

that the trademark FINGERS was inherently distinctive. The Office

objected and the matter proceeded to an ex parte hearing where

Cadbury successfully argued that the mark had acquired

distinctiveness through use and the mark proceeded to publication

for a second time.

Following such publication, Mars lodged an opposition on the

basis that the application was contrary to a number of the absolute

grounds of objection. These included most of the absolute grounds

contained in Section 8 of the Irish Trade Mark Act 1996 (“the Act”)

(equivalent to Article 3 of the 2008 TM Directive), but in line with

the hearing officer’s decision this note focuses on Sections 8(1)(b)

(lack of distinctive character), 8(1)(c) (descriptiveness) 8(1)(d)

(customary use in the trade in question) and the acquired

distinctiveness proviso to these prohibitions.

At a hearing in respect of that opposition, the Controller noted

that the Section 8(1)(d) objection concerned whether, at the

application date, the term “fingers” was a customary term in the

confectionery and biscuit trade in Ireland. The applicant admitted

that the term was generic in the UK and was used in relation to

biscuits but submitted that in the (very much smaller) Irish market

there was little use of the term “fingers” for confectionery and that

such use was also very recent. The Hearing Officer found that

Decision dated April 8, 2019, under the Trade Marks Act 1996 of The Controller of

Patents, Designs and Trade Marks between Cadbury UK Limited (Applicant) and Mars

Incorporated (Opponent).

498 Vol. 110 TMR

although the opponent’s evidence may have post-dated the

application date, it reflected the position as at that date.

Considering the considerable overlap in the chocolate, biscuit, and

confectionery trade between the two jurisdictions and their shared

language, brands, and advertising and also the admitted fact that

“fingers” had become generic in the UK long ago, he went on to find

that at the date of the application the term “fingers” was in use in

the State in respect of the shape characteristic of chocolate,

confectionery, and biscuits for the purposes of Section 8(1)(d) of the

Act.

Following established case law in relation to Section 8(1)(c)

(Article 7(1)(c) of Council Regulation 40/94),

the Controller stated

that it was a matter of determining whether the mark at issue would

be viewed by the average consumer as a means of directly

designating an essential characteristic of the goods for which

registration is sought. The Controller found that not only did the

evidence suggest that the term “fingers” had been used in Ireland in

relation to confectionery and biscuits but that Irish consumers also

used the term to refer to a portion of these goods. The fact that the

applicant had submitted in evidence that “Cadbury has used its

trade mark FINGERS for upwards of at least seventy years in

Ireland in connection with chocolate-coated biscuits of a particular

shape” only helped confirm to the Hearing Officer that the term had

not been used by the applicant in connection with products other

than “finger shaped” biscuits. As a result, he found that the term

“fingers” served in trade to designate the shape of the relevant goods

and therefore the application also contravened Section 8(1)(c) of the

Act.

The Controller noted that once a mark is found to offend Section

8(1)(c) or Section 8(1)(d), it is incapable of performing the essential

function of a trademark and it must follow that the subject mark is

devoid of distinctive character and should be refused under Section

8(1)(b).

Sections 8(1)(b), (c), and (d) are, however, all subject to the

proviso as to whether the mark in question has acquired

distinctiveness through use made of it by the proprietor. Counsel for

Cadbury argued that the mark had been in substantial and

continuous use in the state since the 1950s. Although the Controller

was satisfied that the sign FINGERS had been used by the

applicant for some time, he did not feel that the term had become

synonymous with the applicant alone. He found that the evidence

merely demonstrated that the term “fingers” is a common term to

Including in particular: Wm. Wrigley Jr. & Company v. OHIM, Case C-191/01P

(Doublemint); Koninklijke KPN Nederland NV v. Benelux Merkenbureau, Case C-

363/99 (Postkantoor); Ford Motor Co v. OHIM, T67/07; Sykes Enterprises v. OHIM (Real

People Real Solutions [2002] ECT II-5179); Matratzen Concord AG v. Hukla Germany

SA, Case C-421/04.

Vol. 110 TMR 499

describe biscuits and had been used by many traders in relation to

finger-shaped chocolate-coated biscuits. He placed particular

significance on the applicant’s statement, as noted above, that it had

used the term in relation to chocolate coated biscuits of a particular

shape and that there was no evidence that Cadbury had used the

mark in relation to any other products. The evidence also

demonstrated that the term “fingers” was always used by traders

(including the applicant) together with their house mark, which did

not support a case that the mark had developed secondary meaning

in a trademark sense in relation to the applicant’s goods.

Accordingly, the Hearing Officer concluded that the mark applied

for had not acquired a distinctive character through use.

In view of his findings in relation to Sections 8(1)(b), (c), and (d)

of the Act, the hearing officer upheld the opposition and refused to

allow the applicant’s sign to proceed to registration. It is notable

that under recent amendments to the Irish Trade Mark Act 1996

following Ireland’s implementation of the 2015 TM Directive, third

parties are no longer be able to file oppositions in Ireland based on

absolute grounds but must instead rely upon post-grant invalidity

proceedings.

III. CONFLICT WITH EARLIER RIGHTS—

RELATIVE GROUNDS FOR

REFUSAL OF REGISTRATION

A. Introductory Comments

This Part III relates to claims that a trademark should be

refused registration (or post-registration be declared invalid), on the

basis of its conflict with an “earlier right.” The earlier right is

typically an earlier registered trademark but may also include

challenges based on an earlier unregistered rights.

In relation to conflict with earlier registered trademarks or

trademark applications, there are three grounds for refusal (or post-

registration invalidity):

(1) where the mark applied for is identical to the earlier mark,

and the goods/services for which the applicant seeks

registration are identical to those for which the earlier mark

is protected. Often known as “double-identity” cases, the

relevant rules are contained in Article 8(1)(a) of the 2017

EUTM Regulation and Article 4(1)(a) of the 2008 TM

Directive/ Article 5(1)(a) of the 2015 TM Directive;

(2) where the mark applied for is identical or similar to the

earlier mark and the goods/services for which the applicant

seeks registration are identical or similar to those for which

the earlier mark is protected, resulting a likelihood of

confusion. This provision accounts for much of the case law.

500 Vol. 110 TMR

The relevant provisions are set out in Article 8(1)(b) of the

2017 EUTM Regulation and Article 4(1)(b) of the 2008 TM

Directive/Article 5(1)(b) of the 2015 TM Directive; and

(3) where the use of the mark applied for would offend either or

both of the EU law principles of what are generally known

as trademark dilution and unfair advantage (although not

precisely the language used in the legislation)—see in

Article 8(5) of the 2017 EUTM Regulation and Article 5(3)(a)

of the 2015 TM Directive.

The rules on dilution and unfair advantage apply only in

situations in which the earlier mark has a reputation in the EU, or

in the relevant EU Member State. Claims of this type do not depend

on any similarity of goods/services and may be brought irrespective

of whether or not the contested application covers goods or services

identical or similar to those for which the earlier mark is protected

or in which it has acquired its reputation. Some similarity between

the marks is still a requirement in order to create a link between

the two in the mind of the relevant consumer, although not such

that it would likely result in confusion. The basis for any such claim

is that the use of the junior mark would take unfair advantage of,

or be detrimental to, the distinctive character or the reputation of

the senior mark.

The dilution and unfair advantage rules relating to EU

trademarks are found in Article 8(5) of the 2017 EUTM Regulation.

The corresponding rules relating to applications proceeding before

the national trademark authorities of the EU Member States were

set out in Articles 4(3) and 4(4)(a) of the 2008 TM Directive, dealing,

respectively, with the protection of earlier EUTMs and earlier

national trademarks. These provisions were combined and modified

in the 2015 TM Directive at 5(3)(a) of the 2015 TM Directive (see

below.)

There is a wide range of possibilities for challenges to trademark

applications (or, by way of cancellation action, to registered marks)

based on other types of earlier rights. These include claims based on

unregistered trademarks, copyright, and protected geographical

indications. Relevant provisions are found in Articles 8(4) and 8(6)

of the 2017 EUTM Regulation and in Article 60 of the 2017 EUTM

Regulation (corresponding to Article 53 in the old 2009 EUTM

Regulation), and in Article 4(4) of the 2008 TM Directive. These

provisions are now found at Articles 5(3)(b) and (c) and 5(4) of the

2015 TM Directive. The wording at Article 5(3)(c) of the 2015 TM

Directive is new, which potentially enables the owner of a

designation of origin or a geographical indication to prevent the

registration of a subsequent trademark.

As always, there is a wealth of available case law for this section

of the Review. As a final court of appeal in respect of many of the

decisions made by EUIPO and its Boards of Appeal (in particular in

Vol. 110 TMR 501

respect of oppositions and invalidity), any given year typically

includes an abundance of CJEU case law in respect of relative

grounds conflicts. The same may be said of the General Court as the

penultimate tribunal of appeal. This Review attempts to select

notable or interesting cases of this nature, rather than exhaustively

cover each, but some form of editorial selection is both inevitable

and necessary.

Particular highlights include the CJEU’s decisions in

LUBECA/LUBELSCA, SO BIO, demonstrating the multifaceted

analysis required on a comparison of overall impression, taking into

account dominant, distinctive, and non-distinctive elements, while

the General Court considered the potential conflict between two

trademarks for technology products and the age-old question (at

least in the English language) as to whether apples and pears can

be compared to each other. The extent of methodology and

quantitative and qualitative methods of comparison was examined

by the CJEU in FTI Touristik (in respect of the likelihood of

confusion) and by national courts in Portugal and Poland in relation

to the extended protections afforded to trademarks with a

reputation. Finally, national courts in Denmark, Sweden, and

Germany considered the proper scope of protection and analysis of

particular forms of trademarks in their conflict with earlier rights,

including “position or figurative” trademarks, grayscale/

monochrome trademarks, and trademarks composed of acronyms.

B. Legal Texts

Article 8 of the 2017 EUTM Regulation

1. Upon opposition by the proprietor of an earlier trade

mark, the trade mark applied for shall not be registered:

(a) if it is identical with the earlier trade mark and the

goods and services for which registration is applied

for are identical with the goods or services for which

the earlier trade mark is protected;

(b) if, because of its identity with, or similarity to, the

earlier trade mark and the identity or similarity of

the goods or services covered by the trade marks there

exists a likelihood of confusion on the part of the

public in the territory in which the earlier trade mark

is protected; the likelihood of confusion includes the

likelihood of association with the earlier trade mark.

2. For the purposes of paragraph 1, “earlier trade mark”

means:

(a) trade marks of the following kinds with a date of

application for registration which is earlier than the

date of application for registration of the EU trade

502 Vol. 110 TMR

mark, taking account, where appropriate, of the

priorities claimed in respect of those trade marks:

(i) EU trade marks;

(ii) trade marks registered in a Member State, or, in

the case of Belgium, the Netherlands or

Luxembourg, at the Benelux Office for

Intellectual Property;

(iii) trade marks registered under international

arrangements which have effect in a Member

State;

(iv) trade marks registered under international

arrangements which have effect in the Union;

(b) applications for the trade marks referred to in

point (a), subject to their registration;

registration of the EU trade mark, or, where

appropriate, of the priority claimed in respect of the

application for registration of the EU trade mark, are

well known in a Member State, in the sense in which

the words “well known” are used in Article 6

bis

of the

Paris Convention.

(Note: paragraph 3 was omitted.)

4. Upon opposition by the proprietor of a non-registered

trade mark or of another sign used in the course of trade

of more than mere local significance, the trade mark

applied for shall not be registered where and to the extent

that, pursuant to the [EU] legislation or the law of the

Member State governing that sign:

(a) rights to that sign were acquired prior to the date of

application for registration of the EU trade mark, or

the date of the priority claimed for the application for

registration of the EU trade mark;

(b) that sign confers on its proprietor the right to prohibit

the use of a subsequent trade mark.

5. Upon opposition by the proprietor of an earlier trade

mark within the meaning of paragraph 2, the trade mark

applied for shall not be registered where it is identical

with, or similar to an earlier trade mark, irrespective of

whether the goods or services for which it is applied are

identical with, similar to, or not similar to those for which

the earlier trade mark is registered, where, in the case of

an earlier EU trade mark, the trade mark has a

reputation in [the Union] or, in the case of an earlier

national trade mark, the trade mark has a reputation in

Vol. 110 TMR 503

the Member State concerned, and where the use without

due cause of the trade mark applied for would take unfair

advantage of, or be detrimental to, the distinctive

character or the repute of the earlier trade mark.

(Note: paragraph 6 was omitted.)

Article 60 of the 2017 EUTM Regulation

1. An EU trade mark shall be declared invalid on

application to the Office or on the basis of a counterclaim

in infringement proceedings:

(a) where there is an earlier trade mark as referred to in

Article 8(2) and the conditions set out in paragraph 1

or paragraph 5 of that Article are fulfilled;

(Note: paragraph (b) was omitted.)

8(4) and the conditions set out in that paragraph are

fulfilled.

(Note: paragraph (d) was omitted.)

2. An EU trade mark shall also be declared invalid on

application to the Office or on the basis of a counterclaim

in infringement proceedings where the use of such trade

mark may be prohibited pursuant to another earlier right

under [EU] legislation or national law governing its

protection, and in particular:

(a) a right to a name;

(b) a right of personal portrayal;

(d) an industrial property right.

(Note: Articles 60(3) to 60(5) were omitted.)

Article 4 of the 2008 TM Directive

1. A trade mark shall not be registered or, if registered,

shall be liable to be declared invalid:

(a) if it is identical with the earlier trade mark, and the

goods or services for which registration is applied for

or is registered are identical with the goods or

services for which the earlier trade mark is protected;

(b) if because of its identity with, or similarity to, the

earlier trade mark and the identity or similarity of

the goods or services covered by the trade marks,

there exists a likelihood of confusion on the part of the

public; the likelihood of confusion includes the

likelihood of association with the earlier trade mark.

504 Vol. 110 TMR

2. “Earlier trade marks” within the meaning of paragraph 1

means:

(a) trade marks of the following kinds with a date of

application for registration which is earlier than the

date of application for registration of the trade mark,

taking account, where appropriate, of the priorities

claimed in respect of those trade marks;

(i) EU trade marks;

(ii) trade marks registered in the Member State or,

in the case of Belgium, Luxembourg or the

Netherlands, at the Benelux Office for

Intellectual Property;

(iii) trade marks registered under international

arrangements which have effect in the Member

State;

(b) EU trade marks which validly claim seniority, in

accordance with [the EUTM Regulation] from a trade

mark referred to in (a)(ii) and (iii), even when the

latter trade mark has been surrendered or allowed to

lapse;

(a) and (b), subject to their registration;

(d) trade marks which, on the date of application for

registration of the trade mark, or, where appropriate,

of the priority claimed in respect of the application for

registration of the trade mark, are well known in a

Member State, in the sense in which the words “well

known” are used in Article 6

bis

of the Paris

Convention.

3. A trade mark shall furthermore not be registered or, if

registered, shall be liable to be declared invalid if it is

identical with, or similar to, an earlier EU trade mark

within the meaning of paragraph 2 and is to be, or has

been, registered for goods or services [which are not

similar to those for which the earlier EU trade mark is

registered], where the earlier EU trade mark has a

reputation in the Union and where the use of the later

trade mark without due cause would take unfair

advantage of, or be detrimental to, the distinctive

character or the repute of the earlier EU trade mark.

4. Any Member State may, in addition, provide that a trade

mark shall not be registered or, if registered, shall be

liable to be declared invalid where, and to the extent that:

(a) the trade mark is identical with, or similar to, an

earlier national trade mark within the meaning of

Vol. 110 TMR 505

paragraph 2 and is to be, or has been, registered for

goods or services [which are not similar to those for

which the earlier trade mark is registered], where the

earlier trade mark has a reputation in the Member

State concerned and where the use of the later trade

mark without due cause would take unfair advantage

of, or be detrimental to, the distinctive character or

the repute of the earlier trade mark;

(b) rights to a non-registered trade mark or to another

sign used in the course of trade were acquired prior to

the date of application for registration of subsequent

trade mark, or the date of the priority claimed for the

application for registration of the subsequent trade

mark, and that non-registered trade mark or other

sign confers on its proprietor the right to prohibit the

use of a subsequent trade mark;

of an earlier right other than the rights referred to in

paragraph 2 and point (b) of this paragraph and in

particular:

(i) a right to a name;

(ii) a right of personal portrayal;

(iii) a copyright;

(iv) an industrial property right;

(Note: paragraphs (d)–(g) were omitted.)

5. The Member States may permit that in appropriate

circumstances registration need not be refused or the

trade mark need not be declared invalid where the

proprietor of the earlier trade mark or other earlier right

consents to the registration of the later trade mark.

6. Any Member State may provide that, by derogation from

paragraphs 1 to 5, the grounds for refusal of registration

or invalidity in force in that State prior to the date of the

entry into force of the provisions necessary to comply

with the [EUTM Directive], shall apply to trade marks

for which application has been made prior to that date.

(Note: By virtue of CJEU case law, the wording of Articles

4(3) and 4(4)(a) of the 2008 TM Directive that appears above

in square brackets is effectively to be ignored. In other words,

the rule applies whether or not the goods and services in

question are similar, including in situations where the goods

and services are identical. The 2015 TM Directive includes

revised wording to reflect this, at Article 5(3)(a). The new

provision in Article 5(3)(a) of the 2015 TM Directive covers

both earlier registered national trademarks as well as earlier

506 Vol. 110 TMR

EUTMs. This means that, under the new 2015 TM Directive,

it is mandatory (previously only permissive) for EU Member

States to protect earlier national marks with a reputation

from dilution, or the taking of unfair advantage, in the same

way as they are required to protect EUTMs with a

reputation.)

Article 5 of the 2015 TM Directive

Relative grounds for refusal or invalidity

1. A trade mark shall not be registered or, if registered,

shall be liable to be declared invalid:

(a) it is identical with an earlier trade mark, and the

goods or services for which the trade mark is applied

for or is registered are identical with the goods or

services for which the earlier trade mark is protected;

(b) because of its identity with, or similarity to, the

earlier trade mark and the identity or similarity of

the goods or services covered by the trade marks,

there exists a likelihood of confusion on the part of the

public; the likelihood of confusion includes the

likelihood of association with the earlier trade mark.

2. “Earlier trade marks” within the meaning of paragraph 1

means:

(a) trade marks of the following kinds with a date of

application for registration which is earlier than the

date of application for registration of the trade mark,

taking account, where appropriate, of the priorities

claimed in respect of those trade marks:

(i) EU trade marks;

(ii) trade marks registered in the Member State

concerned or, in the case of Belgium,

Luxembourg or the Netherlands, at the Benelux

Office for Intellectual Property;

(iii) trade marks registered under international

arrangements which have effect in the Member

State concerned;

(b) EU trade marks which validly claim seniority, in

accordance with Regulation (EC) No 207/2009, of a

trade mark referred to in points (a)(ii) and (iii), even

when the latter trade mark has been surrendered or

allowed to lapse;

(a) and (b), subject to their registration;

Vol. 110 TMR 507

(d) trade marks which, on the date of application for

registration of the trade mark, or, where appropriate,

of the priority claimed in respect of the application for

registration of the trade mark, are well known in the

Member State concerned, in the sense in which the

words ‘well-known’ are used in Article 6bis of the

Paris Convention.

3. Furthermore, a trade mark shall not be registered or, if

registered, shall be liable to be declared invalid where:

(a) it is identical with, or similar to, an earlier trade

mark irrespective of whether the goods or services for

which it is applied or registered are identical with,

similar to or not similar to those for which the earlier

trade mark is registered, where the earlier trade

mark has a reputation in the Member State in respect

of which registration is applied for or in which the

trade mark is registered or, in the case of an EU trade

mark, has a reputation in the Union and the use of

the later trade mark without due cause would take

unfair advantage of, or be detrimental to, the

distinctive character or the repute of the earlier trade

mark;

(b) an agent or representative of the proprietor of the

trade mark applies for registration thereof in his own

name without the proprietor’s authorization, unless

the agent or representative justifies his action;

or the law of the Member State concerned providing

for protection of designations of origin and

geographical indications:

(i) an application for a designation of origin or a

geographical indication had already been

submitted in accordance with Union legislation

or the law of the Member State concerned prior

to the date of application for registration of the

trade mark or the date of the priority claimed for

the application, subject to its subsequent

registration;

(ii) that designation of origin or geographical

indication confers on the person authorized

under the relevant law to exercise the rights

arising therefrom the right to prohibit the use of

a subsequent trade mark.

508 Vol. 110 TMR

4. Any Member State may provide that a trade mark is not

to be registered or, if registered, is liable to be declared

invalid where, and to the extent that:

(a) rights to a non-registered trade mark or to another

sign used in the course of trade were acquired prior to

the date of application for registration of the

subsequent trade mark, or the date of the priority

claimed for the application for registration of the

subsequent trade mark, and that non-registered

trade mark or other sign confers on its proprietor the

right to prohibit the use of a subsequent trade mark;

(b) the use of the trade mark may be prohibited by virtue

of an earlier right, other than the rights referred to in

paragraph 2 and point (a) of this paragraph, and in

particular:

(i) a right to a name;

(ii) a right of personal portrayal;

(iii) a copyright;

(iv) an industrial property right;

trade mark protected abroad, provided that, at the

date of the application, the applicant was acting in

bad faith.

5. The Member States shall ensure that in appropriate

circumstances there is no obligation to refuse registration

or to declare a trade mark invalid where the proprietor of

the earlier trade mark or other earlier right consents to

the registration of the later trade mark.

6. Any Member State may provide that, by way of

derogation from paragraphs 1 to 5, the grounds for

refusal of registration or invalidity in force in that

Member State prior to the date of the entry into force of

the provisions necessary to comply with Directive

89/104/EEC are to apply to trade marks for which an

application has been made prior to that date.

Vol. 110 TMR 509

C. Cases

1. EU—CJEU—When assessing the likelihood of

confusion, what is the overall impression created by

the mark as a whole, with regard to both word and

figurative elements?

Republic of Poland and Stock Polska sp. z o.o. v. EUIPO and

Lass & Steffen GmbH Wein- und Spirituosen-Import

concerned

two conflicting marks, both registered for alcoholic drinks.

On March 14, 2013, Stock Polska applied to register the

following trademark with the EUIPO in class 33 for “alcoholic

drinks (except beers)”:

Lass & Steffen filed an opposition to the registration of the mark

in respect of all goods applied for, on the basis of its earlier

registration of the word mark LUBECA in Germany in class 33 for

“alcoholic beverages (except beers).”

The Opposition Division of the EUIPO upheld the opposition,

finding a likelihood of confusion as a result of the identity of the

goods and similarity of marks. This decision was upheld on appeal

by the Fifth Board of Appeal of the EUIPO. The applicant then

appealed to the General Court, arguing an incorrect application of

Article 8(1)(b) of the 2009 EUTM Regulation.

The General Court dismissed the action.

holding that the

Board of Appeal had been correct in its findings. The Court noted

that when a mark is composed of both word and figurative elements

(in this case, a crown and curved writing in LUBELSKA), the word

element is more distinctive than the figurative elements, and both

figurative elements are perceived as essentially decorative and not

as an element indicating commercial origin. Further, the Court

observed that crowns are figurative elements commonly used in the

[2019] Case C-162/17P (CJEU, January 16, 2019) (EU:C:2019:27).

Now found at Article 8(1)(b) Regulation (EU) 2017/1001 of the European Parliament and

of the Council of June 14, 2017, on the European Union trademark, codifying Council

Regulation (EC) 207/2009 on the Community trademark.

Case T-701/15.

510 Vol. 110 TMR

alcoholic beverages sector and, as such, do not exercise a significant

influence on the overall perception of the mark.

The General Court also found that the dissimilarity relating to

figurative elements and different spelling could not prevail over the

word elements of the two marks, which remained very similar.

Finally, as the assessment of the likelihood of confusion must be

based on the overall impression given by signs (particularly bearing

in mind their distinctive and dominant components), the General

Court considered that the Board of Appeal had been correct in

finding a likelihood of confusion between the marks at issue as

perceived by average German consumers.

Following the General Court’s decision, the Republic of Poland,

supported by Stock Polska, appealed to the CJEU arguing an

incorrect application of Article 8(1)(b) of the 2009 EUTM

Regulation. The Republic of Poland submitted that the General

Court had failed to properly carry out a global assessment of the

likelihood of confusion based on the overall impression created,

having regard to the distinctive and dominant elements (the crown

device and the curved style of the word element). It also argued that

the General Court had conducted a restricted assessment of the

similarity of the signs, limiting it to a mere comparison of the word

elements, LUBELSKA and LUBECA.

The CJEU rejected these grounds as unfounded and held that

the General Court had correctly assessed the likelihood of confusion

by examining the marks as a whole, in accordance with previous

guidance.

Further, as neither the crown device nor the curved

writing was liable to substantially influence the overall impression

created by the LUBELSKA mark (as both elements would be

perceived as decorative), the CJEU also found that the General

Court correctly appraised the figurative elements of the

LUBELSKA mark and the similarity of the two marks.

The applicant also argued that the General Court infringed the

principles of equal treatment, legal certainty, and sound

administration by failing to take into account the fact that the

EUIPO did not properly apply its previous decision-making practice,

as set out in the EUIPO guidelines. The CJEU rejected this,

highlighting that the EUIPO guidelines are not binding legal

instruments for the purpose of interpreting provisions of EU law.

The legality (or otherwise) of the decisions of the EUIPO must be

assessed solely on the basis of the 2009 EUTM Regulation, as

interpreted by the EU judicature. Additionally, while the EUIPO is

required to take its previous decisions into account, the examination

Set out in the judgments of Aceites del Sur-Coosur v. Koipe (Case

C-498/07 P, EU:C:2009:503) and MEGA Brands International v. OHIM (Case

C-182/14 P, EU:C:2015:187.

Vol. 110 TMR 511

of any trademark application must be stringent and take into

account the specifics in each individual case. Therefore, following

the judgment in Agencja Wydawnicza Technopol v. OHIM,

the

CJEU confirmed that the General Court was correct in its

assessment, as the registration of a sign as a mark depends on the

specific criteria applicable to the factual circumstances of the

particular case.

The CJEU accordingly dismissed the appeal, concluding that,

even in the absence of an express rule, the reasons given by the

General Court showed that it had considered the figurative

elements to be significant whereas on the General Court’s view, the

word element was not dominant. Therefore, the General Court had

sufficiently stated its reasons for the existence of a likelihood of

confusion, applying the proper legal standard.

2. EU—CJEU—Does the conflicting nature of goods

covered by a trademark damage the reputation of

similar, earlier trademarks?

Groupe Léa Nature SA v. EUIPO

concerned the appeal to the

CJEU by cosmetics company Group Léa Nature in respect of its EU

trademark registration for the figurative mark reproduced below.

The trademark was applied for in (among others) classes 3 and 25

for “preparations for skin, scalp and body care; perfumes; aftershave

preparations; cosmetics” and “bleaching preparations and cleaning

preparations.”

In September 2008, Debonair Trading Internacional Lda

(“Debonair”) filed a notice of opposition against the application on

the basis of its existing UK and EU trademarks SO....? registered in

classes 3 and 25. Debonair’s opposition was ultimately rejected by

the Opposition Division in its entirety and Debonair appealed to the

Case C-51/10 P, EU:C:2011:139.

Case C-505/17 P.

512 Vol. 110 TMR

First Board of Appeal of the EUIPO. The Board of Appeal agreed

with Debonair that both marks were visually and phonetically

similar, given the common dominant element “so” and the fact that

the goods covered by both marks were similar or identical. The

Board of Appeal held that Debonair’s marks had acquired a

reputation in the EU in respect of cosmetics and that Debonair

owned a family of marks containing the “SO....?” element in the

same sector as the applicant. Annulling the decision of the

Opposition Division, the Board of Appeal concluded that there was

a likelihood of confusion between the marks at issue and that the

applicant’s trademark registration should be rejected.

Appealing to the General Court, the applicant argued that the

Board of Appeal had (i) breached the principles of legal certainty,

protection of legitimate expectation, and the right to a fair hearing;

(ii) incorrectly assessed the genuine use of Debonair’s marks; and

(iii) incorrectly applied Articles 8(1)(b) and 8(5) of the 2009 EUTM

Regulation relating to relative grounds for refusal. In considering

the appeal, the General Court rejected many of the applicant’s

arguments but did uphold the argument that the marks at issue

were not similar and that Articles 8(1)(b) and 8(5) of the 2009 EUTM

Regulation has been incorrectly applied.

Following an appeal by Debonair in 2014 against this decision

(and a separate cross appeal by the EUIPO), the CJEU set aside the

General Court’s decision and referred the case back to the General

Court for re-determination.

In its further consideration of the case,

the General Court this time rejected the applicant’s submissions in

relation to Articles 8(1)(b) and 8(5) of the Regulation and dismissed

the applicant’s action entirely.

The General Court noted that since

neither Debonair nor EUIPO had appealed against its judgments on

the applicant’s first and second pleas, those issues would not be

examined. The applicant appealed to the CJEU against the decision

of the General Court, again, on the basis that Articles 8(1)(b) and

8(5) of the 2009 EUTM Regulation had been applied incorrectly.

In considering the proper application of Article 8(1)(b) of the

2009 EUTM Regulation, the CJEU first considered the applicant’s

argument that the General Court had wrongly carried out its

assessment of the relevant public. The applicant argued that the

relevant public was composed of consumers in the EU as a whole

and not, as the General Court had determined, English-speaking

consumers only. The CJEU rejected the Applicant’s submissions, on

the basis that it was partly inadmissible and partly unfounded. The

CJEU observed that the applicant had incorrectly interpreted the

Case T-341/13.

Case C-537/14 P.

Case R 203/2011-1.

Vol. 110 TMR 513

General Court’s findings, and had not, in any event, raised this

argument before the General Court.

The CJEU dealt next with the similarity of the marks at issue.

The applicant had argued that the General Court had not accurately

assessed the distinctive and dominant nature of the “so” elements of

the marks by failing to assess the overall impression of the marks

at issue as well as the individual elements such as the the word “so,”

the punctuation (dots and question marks), and the element “ētic.”

Rejecting this ground of appeal, the CJEU held that the General

Court had correctly applied a global assessment of the marks at

issue in determining whether there was a likelihood of confusion. In

particular, the General Court had correctly recognized that the

element “so” was the first element of the Debonair marks and was

also wholly included, as the first element, in the mark applied for

by the applicant. The General Court correctly held that it is often

the first element of a mark to which consumers pay the most

attention.

The CJEU similarly rejected the applicant’s argument that

there could be no likelihood of confusion between the marks at issue

as the “bio” element of the mark sought was also dominant. The

CJEU reiterated that two marks could be similar even where the

marks were composed of more than one dominant element. As for

the other elements of the marks, the General Court had adequately

assessed those elements as negligible, specifically the General Court

noted that “ētic” was unlikely to be remembered by the public owing

to its smaller size and positioning at the bottom of the mark.

Contrary to the applicant’s submissions, the General Court had

provided sufficient reasoning and correctly assessed the evidence

presented.

In respect of Article 8(5) of the 2009 EUTM Regulation, the

CJEU confirmed that the General Court had properly applied the

necessary criteria to assess the reputation of Debonair’s marks. The

General Court had correctly considered the various relevant factors,

including the market share held by the “SO....?” trademarks and the

intensity, geographic extent, and duration of its use, concluding that

the “SO....?” trademarks had a reputation in a substantial part of

the EU.

The CJEU also rejected the applicant’s argument that the

General Court had failed to assess the link between the marks. The

General Court had reviewed the similarities between the goods and

services and the reputation of Debonair’s marks, concluding that the

relevant public would adversely link Debonair’s mark, which had a

reputation for cosmetics, and the mark applied for, which was used

for cleaning products. It followed from this that the General Court

had adequately set out the conflicting goods covered by the marks

at issue and the “risk of tarnishment” for Debonair’s marks and

514 Vol. 110 TMR

explained that consumers could consider Debonair’s cosmetic

products to contain toxic or harmful substances.

3. EU—CJEU—Do alleged methodological errors in

assessing the existence of a likelihood of confusion

amount to an error of law?

In FTI Touristik v. EUIPO,

the CJEU heard the appeal of FTI

Touristik GmbH (FTI) to annul the General Court’s judgment

under Article 8(1)(b) of the 2009 EUTM Regulation.

On October 7, 2013, the interveners Harald Pratner and Daniel

Giersch filed an application for registration of the following EU

figurative trademark for various goods and services in classes 16,

39, and 43:

In February 2014, FTI filed a notice of opposition against the

mark on the grounds of Article 8(1)(b) of the 2009 EUTM Regulation

citing a likelihood of confusion. The opposition was based on its

earlier registered EU figurative trademark (as below), registered for

various goods and services in classes 16, 39, 41, and 43:

On February 3, 2015, the Opposition Division upheld the

opposition entirely. That decision was annulled by the Fifth Board

of Appeal of the EUIPO. The Board of Appeal ruled that FTI’s

earlier mark had an average inherent distinctive character for non-

English speaking consumers and a weak inherent distinctive

character for the English-speaking public. It further concluded that

there was no likelihood of confusion due to the phonetic, conceptual,

and visual differences between the signs.

Case C-99/18P (CJEU, July 4, 2019) (EU:C:2019:565).

Case T-475/16, not published (GC, November 30, 2017) (EU:T:2017:867).

Now found at Article 8(1)(b) of the 2017 EUTM Regulation.

Vol. 110 TMR 515

The General Court dismissed FTI’s appeal on November 30,

2017, on the basis that the Board of Appeal was justified in finding

that no likelihood of confusion existed and on the basis of the Board

of Appeal’s assessment of distinctive character, which had been

appropriately carried out. The General Court noted that FTI had in

any case failed to establish that the Board of Appeal had wrongly

concluded that there was no likelihood of confusion.

On appeal to the CJEU, FTI argued under a single ground of

appeal divided into four parts, arguing that the General Court had

wrongly applied the relevant provisions of Article 8(1)(b).

First, FTI argued that the General Court had made a

“methodological error” in its assessment of likelihood of confusion in

failing to consider the similarity of the name in normal script of the

contested mark applied for with the earlier mark. FTI additionally

alleged that the General Court had disregarded its obligation to

state reasons for failing to examine the applicant’s argument based

on that name. The CJEU held that this ground of appeal was

admissible as: (a) failure to take into account all factors relevant to

the circumstances when assessing likelihood of confusion on the

part of the public constitutes an error of law that may give rise to

an appeal; and (b) citing its earlier judgment in Dansk Rørindustri

and Others v. Commission,

the extent of the obligation to state

reasons is also a question of law reviewable by the CJEU.

In assessing the merits of the first part of the ground of appeal,

the CJEU ruled that the General Court had not erred by failing to

consider the name of the contested mark “fly” in normal script, as

set out in the EU Trade Marks Bulletin. The CJEU agreed with the

General Court that the name in normal script of a figurative mark

could not be decisive in the assessment of the phonetic impression

of a figurative mark in opposition proceedings. The General Court

had therefore stated its reasoning as it had implicitly considered

that the name in normal script of a figurative mark was irrelevant

for the purposes of determining the relevant public’s phonetic

perception of the contested mark.

FTI’s second argument was based on another methodological

error in relation to the General Court’s finding of no similarity

between the signs, without sufficient justification. While the CJEU

concluded that this argument was admissible, the argument was

rejected for being based on a misreading of the judgment. The CJEU

considered that the General Court had merely established that the

Board of Appeal had been justified in finding no likelihood of

confusion and that the General Court had not relied on a “cancelling

out” of the phonetic similarity by the visual difference of the signs

when assessing similarity.

Case C-189/02 P, C-202/02 P, C-205/02 P to C-208/02 P, and C-213/02 P (CJEU, June 28,

2005) (EU:C:2005:408), at para. 453.

516 Vol. 110 TMR

The CJEU also ruled that FTI’s third argument regarding the

General Court’s error in finding that there was no phonetic

similarity between the marks due to the “.de” element of the earlier

mark was unsuccessful. The General Court’s assessment of a lack of

phonetic similarity between the marks was based on its findings

that: (a) the letter y and the heart symbol applied for are very

different; (b) it is unusual to replace the letter y with such a symbol;

and (c) the relevant public would therefore be unlikely to detect the

letter y in the heart element of the contested mark applied for. In

addition, the General Court had only considered for the sake of

completeness that, should consumers identify the letter y in the

stylized heart symbol, the phonetic coincidence between the word

element “fly” in both signs would nevertheless be weakened by the

“.de” element in FTI’s earlier mark. The CJEU reiterated its earlier

judgment in Intel v. Commission

and confirmed that complaints

directed against grounds included in a judgment purely for the sake

of completeness could not, in any event, lead to the judgment being

set aside under appeal.

Finally, in response to the fourth argument that the heart

symbol in the contested mark was intended by the interveners to be

replaced by the letter y, as it had used a heart symbol in place of a

y in all of their other EU trademarks, the CJEU ruled that this

argument merely challenged the factual analysis of the General

Court and was therefore inadmissible.

4. EU—General Court—Similarity of marks—

Are apples similar to pears for the purposes of an

EU trademark application?

Pear Technologies v. EUIPO,

concerned Pear Technologies Ltd.

(“Pear”), a Chinese digital marketing company, and its EU

trademark application for the figurative pear sign represented

below.

Case C-413/14 P (CJEU, September 6, 2017) (EU:C:2017:632), at para. 63.

[2019] Case T-215/17, EU:T:2019:45, ECLI:EU:T:2019:45.

Vol. 110 TMR 517

The application relates to various goods and services, including

computer software, consultancy services, and computer services in

classes 9, 35, and 42, respectively.

In January 2015, global technology company, Apple Inc.

(“Apple”), filed a notice of opposition against Pear’s application

based on its earlier well-known EU figurative mark (below) also

registered for goods and services in classes 9, 35, and 42.

In March 2016, the Opposition Division upheld Apple’s

opposition on the basis that Apple Inc.’s mark had a reputation

under Article 8(5) of the 2009 EUTM Regulation.

Pear appealed to the Fifth Board of Appeal of the EUIPO

arguing an incorrect application of Article 8(5) of the Regulation by

the Opposition Division. In particular, Pear submitted that there

were no similarities between the marks. Specifically, the mark

applied for was an abstract representation of a pear, which is made

up of numerous mosaic squares and the word “PEAR,” while Apple’s

mark in contrast consists of a solid silhouette of an apple with a bite

taken out of it and a leaf element at the top of the fruit. In

dismissing the appeal, the Board of Appeal considered the visual

and conceptual similarities between the two marks and held that,

in contrast to Pear’s submissions, there was remote visual similarity

between the two marks. The Board of Appeal accepted that the

marks differed in some respects but held that ultimately both marks

depicted “sleek rounded silhouettes of fruit” and included elements

at the top of the main object that were positioned in a similar way

(a leaf and a stem). In relation to conceptual similarities, the Board

of Appeal held that there was also some weak conceptual similarity

518 Vol. 110 TMR

since apples and pears are similar in terms of biology, size, colors,

and texture. The Board of Appeal considered that the two fruits

often act as alternatives to each other.

Turning next to the perception of the consumer, the Board of

Appeal confirmed that because of the strong reputation and

uniqueness of the apple logo, the “somewhat mocking” image of the

pear would establish a link with Apple’s earlier mark. Further, the

Board of Appeal held that use of the mark by Pear was without due

cause and risked taking unfair advantage of the repute of Apple’s

mark. In particular, the Board of Appeal considered that given the

highly distinctive use of fruit in the relevant sector, and the

similarity between the goods and services covered by the marks,

consumers would likely perceive Pear’s goods and services as a

comparable alternative.

Pear appealed to the General Court, again arguing that Article

8(5) of the 2009 EUTM Regulation had been incorrectly applied.

Pear argued that the Board of Appeal had erred in its analysis of

(i) the similarity of the marks; (ii) the link between the two marks;

(iii) unfair advantage; and (iv) the existence of due cause for use of

the mark applied for.

The General Court agreed with Pear’s submissions that the

signs are dissimilar. Specifically, taking into account the marks’

distinctive and dominant elements from the point of view of the

average consumer, the General Court observed that: (i) Pear’s mark

comprised a “large number of squares with curved edges of black

colour . . . [which] form the image of a pear in the mind of the

observer.” This contrasted with Apple’s mark, which would be

viewed as “an apple, with a bite taken out of it, with a leaf sitting

on top”; (ii) The Board of Appeal had incorrectly dismissed the word

“PEAR,” which appears on Pear’s mark as negligible since it

contributed “significantly to determining the image of the mark”;

and (iii) while the positioning of the stem or leaf elements were

similar, “the concrete shape and size of those elements [were] very

different.”

In considering the conceptual similarities of the marks at issue,

the General Court also found that there were clear differences

between the concepts conveyed by the two marks. Although both

marks were fruits, the average consumer would never refer to the

signs in such general terms. Consumers would be specific in

referring to the signs as either “apple” or “pear”; this, therefore,

provided an immediate conceptual difference between the signs. In

addition, while both fruits belonged to the same plant family, the

General Court noted that the average consumer was unlikely to be

aware of that. The General Court confirmed that the mark applied

for presented “the idea of a full pear,” as opposed to a fruit that had

a bite taken out of it, and the concept of a pear with a stem differed

to that of an apple with a leaf. Most notably, the General Court also

Vol. 110 TMR 519

held that “in several EU languages, apples and pears are used in

proverbs to illustrate that two things are different and not

comparable.” For these reasons the Board of Appeal had been wrong

to find that there was any visual and conceptual similarity between

the conflicting signs.

5. EU—General Court—Analysis of the comparisons

between marks composed of personal names

to establish likelihood of confusion in an opposition

Luciano Sandrone v. EUIPO

concerned the application for the

registration of an EU trademark by the applicant, Mr. Luciano

Sandrone, consisting of his first name and surname (LUCIANO

SANDRONE) for goods and services in classes 16, 33, and 35. In

relation to class 33, the application was made for “Alcoholic

beverages (except beer) [and] preparations for making alcoholic

beverages.”

On November 16, 2015, J. Garcia Carrion, SA (“Garcia Carrion”),

a Spanish company, filed a notice of opposition against Mr.

Sandrone’s application based on its earlier EU word mark DON

LUCIANO (the “Earlier Mark”) for “Alcoholic beverages (except

beer)” in class 33. Garcia Carrion argued that a likelihood of

confusion existed under Article 8(1)(b) of the 2009 EUTM

Regulation (now Article 8(1)(b) of the 2017 Regulation) owing to the

similarities of the signs.

In rejecting Garcia Carrion’s opposition, the Opposition Division

of the EUIPO held that the only similarity between the signs was

the first name “Luciano.” The Opposition Division confirmed that

this element was less distinctive than the surname “Sandrone,” and

that most of consumers’ attention would turn to the surname

element. It followed that according to the Opposition Division, a

consumer paying an average level of attention would be able to

differentiate the respective goods and services and therefore no

likelihood of confusion existed. Garcia Carrion appealed to the

Second Board of Appeal of the EUIPO, which annulled the

Opposition Division’s decision and upheld Garcia Carrion’s

opposition. Mr. Sandrone appealed to the General Court arguing

that the Second Board of Appeal had incorrectly applied Articles

47(2) and 47(3) of the 2009 EUTM Regulation relating to genuine

use and Article 8(1)(b) of the 2009 EUTM Regulation relating to the

similarity of the signs.

The General Court considered the question of genuine use first.

The General Court reiterated the established test that genuine use

of a mark exists where the mark is used to differentiate the origin

[2019] (EU:T:2019:452).

520 Vol. 110 TMR

of the goods or services for which it is registered. There is no

“genuine use” where there is simply “token” use to preserve the

rights conferred by the mark.

The Court noted that any evidence

would need to establish the place (to be sufficiently widespread),

duration, extent, and nature of use of the Earlier Mark. As set out

in Article 47(2) of the 2009 EUTM Regulation, Garcia Carrion was

required to show proof of genuine use during the five years

preceding the filing date for the application opposed, being August

18, 2010, to August 17, 2015, inclusive.

The Court noted that Garcia Carrion had adduced 53 sample

invoices dating between 2011 and 2015 sent to various clients; an

announcement that appeared in a wine catalogue for a two-week

period in 2010 reading “DON LUCIANO 2009 D.O. – La Mancha”;

an undated brochure with pictures of wine bottles with the brand

“Don Luciano” on their labels; and a screenshot dating back to 2014

of marketing materials from Garcia Carrion’s website.

In considering the duration of use, the Court found that this

criterion had been satisfied. Use did not need to be uninterrupted to

constitute genuine use, there need only be consistent use that is

established by the repetition of relevant acts. Given that the

invoices covered most of the five-year period they established

consistent use. The Court also found that the catalogue was proof

that the goods had been placed on the market and offered for sale to

consumers during this period.

In deciding whether Garcia Carrion’s evidence satisfied the

various conditions of genuine use, the General Court confirmed first

that the invoices satisfied the location criterion since they related to

a large part of the EU (eleven Member States). In respect of the

extent of use, the General Court found that this criterion had also

been satisfied. The General Court observed that “[the] invoices

provide[d] ample evidence to establish extent of use.” The invoices

alone showed that several thousand bottles of wine had been sold

and that the total values of sales were “non-negligible.”

Finally, the General Court turned to the nature of use and

confirmed that this was also met. The Court rejected the applicant’s

argument that the appearance of wine in a catalogue did not amount

to marketing of that wine. The Court also accepted that reference to

“D. LUCIANO” on several invoices rather than “DON LUCIANO”

was because there was a lack of space. The General Court confirmed

that in Spanish, “D” is an abbreviation of “Don” and that “VINO D.

LUCIANO” was supported by other items that indicated the nature

of the goods. Although the labels in the catalogue and brochure

showed the Earlier Mark in a different graphic form, word marks

should be considered used to the extent that the graphic addition

does not alter their general impression.

VITAFRUIT, Case T-203/02 (EU:T:2004:225).

Vol. 110 TMR 521

In relation to the proper application of Article 8(1)(b) of the 2009

EUTM Regulation, the General Court assessed the similarities of

the signs. Regarding the comparison of the goods, the Court rejected

Mr. Sandrone’s arguments that there was a difference in the origin

of the grapes, or label and price of the wine. The General Court

observed that the application had not been restricted to certain

designations of origin, or varieties of grape. Furthermore, the goods

referred to in the application were intended for general consumption

and the wines referred to were not limited to luxury wines. It was

clear that the goods covered by the application and those of the

Earlier Mark were identical.

In view of a global assessment of the likelihood of confusion, the

General Court held that for the Earlier Mark, the element “Luciano”

was more distinctive than “Don” because “Don” was shorter and was

used as a title in Italian and Spanish. In relation to Mr. Sandrone’s

sign, the General Court confirmed that “Sandrone” is more

distinctive than “Luciano” (but did not render the latter negligible).

Specifically, the General Court noted that a first name will not

necessarily be perceived as rare by the relevant public in a Member

State merely because it is not common there. Before carrying out

the visual, phonetic, and conceptual comparison of the signs, the

distinctive element of each sign should have been identified;

namely, “Luciano” in the Earlier Mark, and “Sandrone” in the sign

covered by the application. The Board of Appeal had erred in failing

to do the latter. In particular, the General Court held that the Board

of Appeal had not correctly carried out a global assessment of the

likelihood of confusion since it had failed to take into account all of

the relevant factors. Depending on the facts of the case, it was

possible that there could be no likelihood of confusion even where

identical goods are involved but there is weak similarity between

the marks.

In considering the visual and phonetic similarity, the General

Court noted that there was at least low similarity between the signs

because both marks shared the first name “Luciano.” A conceptual

comparison was not possible, however. The Court highlighted the

literal and legal definition of the term “concept” and found that the

first name, “Luciano,” and surname, “Sandrone,” used by the signs

neither convey a general and abstract idea nor any “semantic

content.”

In that way, the Board of Appeal had been wrong to

determine that average conceptual similarity existed. There was no

likelihood of confusion between the two signs and the General Court

upheld the applicant’s second claim in the appeal.

In view of these considerations, the General Court determined

that given the lack of a link between the marks, there was no need

SABEL v. Puma, Case C-251/95 (CJEU, November 11, 1997) (EU:C:1997:528).

522 Vol. 110 TMR

to examine whether the applicant had proven a likelihood of undue

detriment or unfair advantage.

6. The Netherlands—The Hague Court of Appeal—

Belgium—Brussels Court of Appeal—

Who is the relevant group when

determining likelihood of confusion?

In two cases with similar facts and the same trademark

proprietor, the decisions of the Benelux Office for Intellectual

Property (“BOIP”) were annulled by the Hague Court of Appeal in

BlackBerry v. Maxnet and BlackBerry v. CKL Holdings. It should

also be noted that following a change in the procedural and

jurisdictional rules relating to appeals the Courts of Appeal in

Brussels, the Hague and Luxembourg are no longer competent to

rule on appeals against BOIP decisions. All such appeals are now

centralized before the Benelux Court of Justice.

In the first case, BlackBerry Ltd. opposed the registration of the

Benelux mark BERRYBOOT. The BOIP concluded that, due to the

visual, aural, and conceptual similarity, there was a likelihood of

confusion between BLACKBERRY and BERRYBOOT for identical

or similar products in the IT field. However, at appellate level, the

Dutch Court of Appeal disagreed with the findings at first instance.

The Court held that there was a limited degree of visual similarity

between the marks. The total number of letters differed, and the

common word-element BERRY was placed in different locations—

in the front of the contested sign and in the back of the registered

trademark, respectively. Further, the Court considered that there

was no aural similarity given that, other than the common BERRY-

element, the marks were significantly different. Moreover, there

was no conceptual similarity, as the contested sign would be

perceived as a reference to either a type of footwear (a boot) or to

starting up a computer (to boot). The Dutch Court of Appeal

concluded that there was no likelihood of confusion between

BLACKBERRY and BERRYBOOT and annulled the BOIP decision.

In the second case, BlackBerry Ltd. opposed the registration of

the Benelux mark STRAWBERRY.COM. The BOIP concluded that

there was no visual, aural, or conceptual similarity between the

marks and no likelihood of confusion on the part of the relevant

public. At appellate level, the Brussels Court of Appeal held a

different view. The Court underlined the conceptual similarity

between the marks, as they both refer to a certain kind of berry.

Moreover, the addition of the “.com” element would be perceived by

the relevant public as an extension of a generic top-level domain

name and thus lacking in distinctiveness. BLACKBERRY and

STRAWBERRY were the dominant elements in both marks.

Further, although the goods and services were equally targeted at

Vol. 110 TMR 523

both professionals and the wider general public, particular account

should be taken of the relevant group with the lowest level of

attention and knowledge (being the general public). The fact that

intermediaries can give advice or might even influence the public in

their decision-making did not exclude the possibility of a likelihood

of confusion in all cases. Consequently, considering the high

distinctive character of the BLACKBERRY mark, there remained a

risk of a likelihood of confusion among the relevant public between

the marks BLACKBERRY and STRAWBERRY.com. Accordingly,

the Brussels Court of Appeal annulled the decision by the BOIP.

7. Portugal—Lisbon Court of Appeal—

Can the assessment of the reputation of a trademark

be exclusively based on qualitative criteria?

The decision of the Lisbon Court of Appeal in BELCANTO

considered the test for establishing whether a trademark had

acquired a reputation.

On March 14, 2016, Granacer - Administração de Bens, S.A., a

Portuguese company (“Granacer”), filed a trademark application for

a national trademark in Portugal for the mark BELCANTO (No.

561896) to cover wines (in class 33), which was duly registered by

the Portuguese Institute of Industrial Property. An appeal against

the decision of the Portuguese PTO to register the mark was filed

before the Portuguese Intellectual Property Court by Portuguese

company Gonzalez, Garrido & Antela, Lda. (“Gonzalez”), owner of

an earlier national trademark for the same mark BELCANTO (No.

455669) registered in respect of “bar services and cafe-restaurants

services” in class 43.

Gonzalez argued that both signs were identical to each other and

that the services covered by the earlier trademark in class 43 could

be considered similar or complementary to the goods covered by the

contested trademark in class 33. In addition, the appellant claimed

that their earlier trademark BELCANTO had established a

reputation in the market such that the later mark would take unfair

advantage of the reputation of the earlier mark. The Portuguese

Intellectual Property Court upheld the decision of the Portuguese

PTO and rejected the arguments of Gonzalez.

Gonzalez appealed to the Lisbon Court of Appeal. In its

judgment of May 23, 2019, the Appeal Court considered that the

goods for which the later mark had been registered (wine) were

indeed complementary to the services covered by the earlier

trademark in class 43 (bar services and cafe-restaurants services)

since they share the same distribution channels and are directed to

the same consumer in the general public.

Lisbon Court of Appeal, May 23, 2019, 148/17.2YHLSB.L1-8.

524 Vol. 110 TMR

The Court also accepted that the earlier Portuguese trademark

BELCANTO enjoyed a reputation in the territory of Portugal. The

evidence filed by the appellant included documents establishing the

media exposure and advertising associated with the proprietor’s bar

and cafe-restaurant services, which together with the quality of

such services and the long-standing presence of the earlier

trademark BELCANTO in the market, established the reputation

of that trademark with consumers. The Appeal Court also accepted

that both national and international reputation had relevance in the

recognition of the services provided in connection with the earlier

trademark BELCANTO. Overall, the coexistence of the goods and

services covered by both trademarks in the market would

potentially allow the misappropriation of the reputation and

distinctive character of the earlier trademark and the proprietor of

the earlier trademark was entitled to object on that basis. It has

been noted that the decision of the Lisbon Court of Appeal in

BELCANTO is arguably more generous than previous case law in

establishing the necessary reputation. In particular, the proprietor

in this case established reputation with only qualitative criteria,

whereas in previous cases both qualitative and quantitative criteria

have been deemed necessary. This “previous” approach can be

illustrated by the decision of the Lisbon Court of Appeal,

which

held that “as for the prestigious trademark, it should enjoy

exceptional notoriety, meaning that it must be ‘spontaneous,

immediate and generally known to the general consumer and not

only to the corresponding interested circles, as the distinctive sign

of a certain type of goods or services’ [evidence of a quantitative

nature]; as well as enjoying exceptional attraction and/or

satisfaction with the consumers, and must have a high symbolic-

evocative value with the consumer, despite not being of large

consumption, or with a high degree of satisfaction with the large

consuming public [evidence of a qualitative nature].”

8. Sweden—Swedish Patent and Market Court of

Appeal—What is the proper scope of protection for

marks registered in monochrome or grayscale?

The Swedish Patent and Market Court of Appeal’s decision

issued in February 2019 in ContextLogic Inc. v. The Swedish Patent

and Registration Office (PRV)

led to a substantial change of

practice in Sweden by more closely following EU practice in respect

of the scope of protection for marks registered in monochrome or

Case No. 1135-05.9TVLSB.L1-2.

Case No. PMÖÄ 435-18 (Swedish Patent and Market Court of Appeal, February 27,

2019).

Vol. 110 TMR 525

grayscale. Following the Appeal Court’s decision, the scope of

protection for trademarks registered in black and white or grayscale

in Sweden has been significantly limited (see also a similar decision

issued by the lower court of the Swedish Patent and Market Court

of November 2018

Prior to this change of practice, in Sweden it was advantageous

to register trademarks in black and white or grayscale even if in

ordinary use such marks contained a single or even several colors.

This was because the protection for such trademarks was deemed to

automatically include all possible colors and color combinations.

This led to a broader scope of protection, whereas the protection for

trademarks registered with specific colors was limited to those

specific colors. This previous practice applied to all trademarks on

the Swedish trademark register, irrespective of whether such

trademarks had undergone a national or international application

process.

In 2014, Sweden had acknowledged and supported the work

carried out as part of the Convergence Programme through the

European Trade Mark and Design Network, which led to the

development of a common practice among national trademark

offices throughout the EU with regard to trademarks registered in

black and white or grayscale. However, Sweden opted out of the

implementation of the common practice, citing legal constraints.

The Swedish Patent and Registration Office had claimed that it was

not able to implement the common practice as preparatory

legislation work in Sweden originating from 1958 (a state public

report published by a committee appointed by the Swedish

Government)

stated that the scope of protection for trademarks

registered in black and white or grayscale in Sweden was deemed to

include coverage for all colors.

In the present case before the Appeal Court, ContextLogic Inc.

had filed for registration of the followed trademark in Sweden.

The applied-for trademark

The earlier trademark

Case No. PMÄ 5094-18 (Swedish Patent and Market Court, November 22, 2018).

The State Public Report SOU 1958:10, page 107.

526 Vol. 110 TMR

The trademark consisted of the letter g in white and a gray-

colored square (above, left) in relation to (among others) a certain

type of computer software. Following the Swedish Patent and

Registration Office’s ex officio search on relative grounds during its

examination of the application, the Office rejected the application

due to a likelihood of confusion with an earlier trademark (above,

right) consisting of the letter g in white and a red-colored square

with white edges, also registered in respect of (among others) a

similar type of computer software.

Although the Office did not explicitly state this in their decision,

it is to be inferred that the Office based their visual comparison of

the trademarks on a scope of protection for the pending application,

which included a white letter and a red square (i.e., following the

color scheme of the earlier cited mark). This was in accordance with

the practice at the time, as the protection for the applicant’s mark

(if registered) would have automatically included color

permutations such as the different shades of red found in the earlier

trademark. This comparison of the two trademarks, of course,

significantly increased the visual similarities between the marks.

The Office found both the marks and the goods at issue similar, and

therefore rejected the trademark application due to a likelihood of

confusion. The applicant appealed the Office’s decision to the

Swedish Patent and Market Court, which upheld the Office’s

decision at first instance and dismissed the appeal. The applicant

appealed the Court’s decision to the Appeal Court.

The Appeal Court concluded that the Swedish practice regarding

black and white and grayscale trademarks was inconsistent with

the approach of the CJEU in several cases including Specsavers

well Milanówek Cream Fudge.

In Specsavers, the CJEU held that

an EU trademark proprietor may obtain protection regarding

certain colors (even if the trademark has been registered in black

and white), but only if the mark has become associated with those

colors through use. Consequently, Specsavers confirmed, by

implication, a black and white or grayscale registration of an EU

trademark does not as such cover all or any specific colors or color

combinations. This can only be acquired through use of the mark in

a color and form. This was also clarified in Milanówek Cream Fudge,

in which the CJEU concluded that the comparison of the visual

aspects of the trademarks at issue had to be based on the signs as

they were registered or as they appeared in the application for

registration, unless the marks had become associated with other

colors through use.

Specsavers International Healthcare Ltd., among others v. Asda Stores Ltd., Case

C‑252/12 (CJEU, July 18, 2013) (ECLI:EU:C:2013:497), paras. 37-38 and 41.

Pico Food GmbH v. EUIPO, Case T‑623/11 (CJEU, April 9, 2014) (ECLI:EU:T:2014:199),

paras. 37-38.

Vol. 110 TMR 527

In light of the established EU practice, the Swedish Appeal

Court concluded that a trademark registered in black and white or

grayscale in Sweden cannot automatically be deemed to cover all

colors or color combinations. Instead, the protection shall be limited

to the actual appearance of the trademark in the Swedish

trademark register (unless a trademark becomes associated with

certain colors through consistent and long-standing use in that form

(as in Specsavers)). As such, EU and Swedish practice regarding the

scope of protection for black and white or grayscale trademarks has

converged.

Applying that (revised) practice to the case at hand before the

Appeal Court, the Court concluded that the similarity between the

trademarks was low, not least as the opposed application was in

grayscale and the earlier registered mark was in a white and red

color scheme. The scope of protection of the earlier trademarks was

also limited due to the low degree of inherent distinctiveness (of both

marks), so overall there was no likelihood of confusion between the

trademarks. Separately, the Appeal Court also found that the

goods/services were neither identical nor similar.

The implication of the Swedish Court of Appeal’s decision is that

it took effect both immediately and retrospectively. The decision will

therefore continue to be a highly relevant issue for brand owners

and practitioners in Sweden for some considerable time and raises

issues such as the future enforcement of monochrome marks as well

as in respect of genuine use and revocation issues.

9. Poland—Polish Supreme Administrative Court—

Guidance in the assessment of a link between an

earlier mark with reputation and a later trademark

The judgment of the Polish Supreme Administrative Court

(“SAC”) in II GSK

concerned a declaration of invalidity based on a

conflict with an earlier trademark with a reputation.

Red Bull GmbH, the “opponent,” filed an opposition (the

“opposition”) with the Polish Patent Office (“PPO”) based on Article

132(1) sec. 1 pt. 4 of the Polish Industrial Property Law (“IPL”)

seeking to prevent an application for registration of the figurative

trademark BULLTEC in classes 11 and 12, including lamp shades,

flashlights, car headlights and car bodies, car tires and car chassis

by Polish partnership VISIO, the applicant. The opponent claimed

that the disputed mark was confusingly similar to a number of its

earlier national and EU figurative and word trademarks for BULL

and RED BULL, registered for, inter alia, non-alcoholic beverages

including energy drinks and isotonic drinks, clothing, footwear, and

services for providing food and drink, all of which were claimed to

(SAC, May 15, 2019), II GSK 1515/17, LEX No. 2703754.

528 Vol. 110 TMR

be marks with a reputation. Some of the relevant trademarks are

set out below by way of comparison.

The PPO dismissed the opposition. In its decision the PPO

emphasized that the burden of proof is on the opponent, in

particular in establishing that that earlier trademarks relied upon

have a reputation as claimed. Such reputation must at the latest, be

established at the date of application of the mark opposed. In

reaching its decision, the PPO referenced a range of CJEU

authorities, including General Motors

and SPA Finders,

where

the CJEU had ruled that demonstrating reputation is a knowledge

threshold requirement, implying that such assessment is primarily

based upon quantitative criteria.

In applying that test, the PPO determined that the opponent had

failed to establish the reputation of the word mark BULL at the

relevant time. The PPO concluded that this particular trademark

was not functioning independently within the Polish market,

because it started to be used after the date of application for the

BULLTEC trademark and the goods marked with BULL trademark

were not placed on the Polish market. Therefore, the PPO concluded

that the BULL trademark did not enjoy reputation as claimed

within the territory of Poland at the relevant time of filing the

application. The opposition was therefore considered based upon

only two of the four trademarks cited by the opponent (being the

RED BULL marks).

In carrying out its assessment of similarity, the PPO considered

that the trademarks were similar due to the common use of a red

color and the word “BULL,” combined with a graphic element

incorporating a drawing presenting a stylized image of a bull.

However, such similarity was neither substantial nor confusing.

In considering whether a link would be established between the

mark and a sign that would result in unfair advantage to the

applicant or be detrimental to the distinctive character or to the

repute of the earlier trademarks, the PPO applied the

Case C-375/97 (General Motors), pt. 21 (CJEU, September 14, 1999)

(ECLI:EU:C:1999:408).

Case T-67/04 (Spa Finders) (CJEU, May 25, 2005) (ECLI:EU:T:2005:179).

Vol. 110 TMR 529

considerations set out by the CJEU in Intel

taking into account the

degree of similarity between the conflicting marks; the nature of the

goods or services for which the conflicting marks were registered,

including the degree of similarity between these goods or services,

the relevant section of the public; the strength of the earlier mark’s

reputation; the degree of the earlier mark’s distinctive character

(whether inherent or acquired through use) and the existence of the

likelihood of confusion on the part of the public.

In its assessment, the PPO concluded that the similarity

between earlier trademarks and the opposed mark was quite low, so

the overall perception of the opposed mark did not suggest that the

mark was an imitation of the earlier trademarks. It did not use

individual elements in an identical form or according to the same

concept. Moreover, the character of goods for which the disputed

trademark was registered was substantially different from the

goods designated by the opponent’s marks and applicable for

different market segments. It followed that the relevant public for

energy drinks is well informed and would not expect that the

opponent indicates services or goods in the automotive industry.

The argument raised by the opponent that it often runs advertising

campaigns on events related to the automotive industry was also

rejected as the PPO ruled that a relevant consumer is capable of

differentiating the goods themselves from their advertising and

promotion. Overall, in the opinion of the PPO, the risk of unfair

advantage arising for the applicant or detrimental effects being

suffered by the opponent’s trademarks were not substantiated.

On first appeal, the District Administrative Court (“DAC”)

upheld the decision of the PPO. The opponent then appealed to the

Supreme Administrative Court (“SAC”). In its decision, the SAC

confirmed that the proper interpretation of Article 132(1) of IPL had

been made by the PPO and the DAC and dismissed the appeal.

In its judgment, the SAC offered step-by-step guidance for the

assessment of infringement of an earlier mark with a reputation by

the registration of a later mark in respect of which a declaration of

invalidity is sought, as being: (a) the registration of the earlier

trademark; (b) the earlier trademark having a reputation within the

relevant territory, at the time of application for registration of the

later mark; (c) the earlier registration may be for any class of goods

or services; (d) a link is established between the marks; (e) the

future results in a likelihood of unfair advantage of or undue

detriment to the distinctiveness or repute of the earlier trademark.

The SAC agreed with the interpretation given by the PPO and

confirmed that no link between the marks could be established on

Case C-252/07 (CJEU, November 27, 2008) (Intel Corporation Inc.), pt. 34

(ECLI:EU:C:2008:655).

530 Vol. 110 TMR

the facts. Applying the CJEU’s test as laid out in Intel,

a link

between the conflicting marks would be established when the later

mark calls the earlier, reputable, mark to mind for the average

consumer (being reasonably well informed, observant, and

circumspect).

10. Denmark—The Danish Maritime and Commercial

High Court—What is the relevance of the potential

placement of figurative marks on a product?

On July 4, 2019, The Danish Maritime and Commercial High

Court

upheld a decision from the Danish Trademarks and Patents

Office (“DKPTO”) relating to an invalidity action brought by Puma

SE (“Puma”). The key question was whether a figurative mark

registered by DK Company Vejle A/S (“DKC”) was confusingly

similar to a figurative mark registered by Puma SE (“Puma”) when

used for footwear.

On July 10, 2015, DKC filed an application for registration with

the DKPTO of the following figurative mark for a range of goods in

classes 9, 18, and 25 of the Nice Classification:

On November 5, 2015, the mark was registered (DKPTO

Registration No. VR 2015 02572) in class 9 (glasses, sunglasses, and

covers), class 18 (purses, travel- and shopping bags, suitcases,

trunks, wallets, and umbrellas), and class 25 (clothing for men,

women, and children; footwear and headgear for men, women, and

children).

Puma is the proprietor of a number of registered trademarks

(including several EUTMs), and in particular Danish trademark

Registration No. VR 1977 02215 (figurative) registered in class 25

for “shoes, in particular sports and leisure footwear,” which

comprises Puma’s reputed “form strip.” Puma filed an application

for a declaration of invalidity against the mark registered by DKC.

Puma’s action was based on grounds that the mark was confusingly

similar with Puma’s own marks, especially the “form strip” (see

Puma’s marks below):

Id., pt. 63.

Case No. BS-16677/2018-SHR, Puma SE v. Danish Trademarks and Patent Office.

Vol. 110 TMR 531

Puma referred to the Danish Trademarks Act, Section 15(1)(2),

cf. Section 15(3)(1) (implementing the 2008 TM Directive,

Article 5(1)(b), cf. Article 5(3)(a)).

On June 23, 2017, the DKPTO rejected Puma’s invalidity action

but accepted that Puma’s VR 1977 02215 mark had a reputation in

Denmark. The DKPTO considered that although there were certain

similarities between the marks, the marks at issue conveyed an

overall different impression. DKC’s mark would be perceived as two

separate “lanes,” while Puma’s mark(s) would be perceived as an

assembled arc divided into three “lanes.” The marks also differed in

the way that Puma’s mark was less compact and had a more

sweeping look, that—when applied to a shoe—meant that the point

where the lanes came together would sweep toward the heel of the

shoe. This would not be the case for DKC’s mark when applied to a

shoe. Against this background, DKPTO found that the marks were

not confusingly similar.

Puma filed an appeal with the Danish Board of Appeal for

Patent and Trademarks (“BoA”). The BoA confirmed the decision on

March 14, 2018, adding that when assessing the scope of protection

afforded to the marks relied on by Puma, such scope had to be

viewed in the light of 1) the relative low degree of distinctiveness of

the marks, even in situations where the marks had subsequently

acquired a reputation, and 2) an overall assessment of the marks.

Court decision

Puma appealed from the BoA’s decision to the Maritime and

Commercial High Court, claiming that the BoA had omitted

relevant criteria in its overall assessment of the mark, including the

fact that DKC’s mark is not a position mark. Therefore, the mark

could be “stretched and twisted” in its use in the marketplace, so

that it would have the same position and orientation as Puma’s

marks on a shoe.

The Maritime and Commercial High Court found that while

there were similarities between the marks, there were also

532 Vol. 110 TMR

differences. Further, the fact that DKC had not positioned the

registered mark on a shoe should not lead to a different assessment

of the mark’s expression. The court said that stretching or twisting

the mark (for example by placing it with a start at the ball of the

foot and ending shortly before the heel-cap) would entail an

assessment of a different mark from DKC’s registered mark, which

was not a legitimate assessment.

Based on an overall assessment, the court found that the BoA

had not erred in the assessment of all relevant criteria in its

decision, upholding the decision of the BoA and rejecting the

invalidity application. The case confirms that the courts and

DKPTO in Denmark will consider the assessment of marks based

upon their depiction on the register, rather than how they might (or

might not) be applied on the goods in respect of which such

registration has been secured.

11. Germany—Federal Patent Court—

What is the relevant scope of protection for

acronyms as trademarks?

In two decisions of January 14, 2019, and February 21, 2019, the

Federal Patent Court

considered the distinctiveness of an acronym

in a composite mark where the letters of that acronym corresponded

to verbal elements that themselves lacked distinctiveness.

1. “JBG Junior Brands Group”

In the first case, the applicant had filed an application for the

registration of the mark as below in respect of clothing, footwear,

and headgear and for retail services related to cosmetics, jewelry,

bags, and various baby-related goods.

The German PTO refused registration on the basis that the

components of the sign JUNIOR BRANDS GROUP were not

distinctive. The public would likely perceive the word elements of

the sign as an indication of a group of companies that deals with or

supports brands that are not yet established on their market. The

initials J B G may have been considered distinctive in isolation, but

in composite form would be perceived as a mere abbreviation of the

non-distinctive word elements, rendering the entire mark as lacking

in distinctiveness.

Case No. 27 W (pat) 544/16 and 30 W (pat) 548/18.

Vol. 110 TMR 533

On appeal, the Federal Patent Court overruled the PTO’s

decision. According to the Court, the letters J B G would not merely

be perceived as an abbreviation of the words “Junior Brands Group”

because of their graphical and stylized element. The eye-catching

design of the letter sequence would enable the public to recognize it

as a distinctive element independent of the word component.

Applying a precedent established by the Federal Patent Court in

2014,

which had considered a comparison of the trademarks BSA

and and found the DSA element to dominate the overall

impression of the trademark, this would lead to a finding that the

visual and stylized acronym as the only distinctive element

would also dominate the overall trademark and would be the only

component to be compared with other JBG trademarks.

2. “WundTherapieZentrum”

In the second case, the applicant had filed an application for the

registration of the following mark for pharmaceutical and

orthopedic products and medical services.

The German PTO had refused to register the sign, arguing that

word components comprising “WundTherapieZentrum” (roughly

translated as “Center of Wound Therapy”) were not distinctive. It

considered the sign to be descriptive of medical services in the field

of wound therapy.

As in the first case, the highlighted initial letters W T Z were

considered non-distinctive even though distinctive in themselves, as

they would be perceived as a mere abbreviation of the non-

distinctive word elements when presented in composite form. In

contrast to the first case, however, the Federal Patent Court

followed the German PTO’s approach. The Court considered that

the letters W T Z would immediately be recognized as the initials of

the descriptive word “Wundtherapiezentrum” and not alter the non-

distinctive character of the mark overall, having no independently

distinctive role.

IV. BAD FAITH

A. Introductory Comments

The validity of an EU trademark may be challenged on the basis

that the application and/or resultant registration was made in bad

faith. An invalidity action may be brought under Article 59(1)(b) of

Case No. 27 W (pat) 554/13.

534 Vol. 110 TMR

the 2017 EUTM Regulation (corresponding to Article 52(1)(b) of the

old 2009 EUTM Regulation).

The 2008 TM Directive also contained two relevant provisions,

Article 3(2)(d) and Article 4(4)(g). The provisions in the 2008 TM

Directive created options for the EU Member States as to what

might be implemented under domestic law. Under the 2008 TM

Directive each EU Member State could choose to incorporate into its

law a broader bad faith provision under Article 3(2)(d), a narrower

one under Article 4(4)(g), or neither. However, it is important to note

that the 2015 TM Directive has now adjusted this position and

provides that bad faith is to be a mandatory invalidity ground going

forward, as well as being a basis on which Member States may

optionally provide that bad faith should be an opposition ground

during the application phase. Relevant provisions of the 2015 TM

Directive are Articles 4(2) and 5(4)(c).

The issue of bad faith has become quite a “hot topic” for EU

trademark practitioners in recent years. The much anticipated

CJEU decision in Skykick was handed down on January 29, 2020

(so technically just outside the scope of this year’s review but

delivered just in time for inclusion nevertheless), providing welcome

clarity on the relevant facts and circumstances in which a mark filed

without any intention to use in respect of particular goods and

services might amount to bad faith. That case also established that

a lack of clarity and precision of terms included in the specification

did not amount to an independent ground of invalidity. The KOTON

proceedings involved a bad faith allegation in a long-running

dispute between two parties litigating before both the EUIPO and

Spanish courts. Other cases before national courts considered the

bad faith nature of an application for the name of a famous

footballer, applications made following failed commercial

discussions between two parties, applications made in order to

obtain money from or block a competitor, as well as the first

opportunity of the UK High Court to consider the applications made

by companies owned or controlled by Mr. Michael Gleissner (a name

familiar to many EU trademark practitioners).

B. Legal Texts

Article 59(1)(b) of the 2017 EUTM Regulation

1. An EU trademark shall be declared invalid on

application to the Office or on the basis of a counterclaim

in infringement proceedings:

(Note: paragraph (a) was omitted.)

(b) where the applicant was acting in bad faith when he

filed the application for the trademark.

Vol. 110 TMR 535

Article 3(2)(d) of the 2008 TM Directive

1. Any Member State may provide that a trademark shall

not be registered or, if registered, shall be liable to be

declared invalid where and to the extent that:

. . . the application for registration of the trademark was

made in bad faith by the applicant.

Article 4(4)(g) of the 2008 TM Directive

1. Any Member State may . . . provide that a trademark

shall not be registered or, if registered, shall be liable to

be declared invalid where, and to the extent that:

. . .

(a) the trademark is liable to be confused with a mark

which was in use abroad on the filing date of the

application and which is still in use there, provided

that at the date of the application the applicant was

acting in bad faith.

Article 4(2) of the 2015 TM Directive

2. A trade mark shall be liable to be declared invalid where

the application for registration of the trade mark was

made in bad faith by the applicant. Any Member State

may also provide that such a trade mark is not to be

registered.

Article 5(4)(c) of the 2015 TM Directive

4. Any Member State may provide that a trade mark is not

to be registered or, if registered, is liable to be declared

invalid where, and to the extent that:

(Note: paragraphs (a)–(b) were omitted.)

trade mark protected abroad, provided that, at the

date of the application, the applicant was acting in

bad faith.

536 Vol. 110 TMR

C. Cases

1. EU—CJEU—A trademark must be declared

invalid where the application to register

was for the intention of undermining the interests of

third parties or for obtaining an exclusive right

for purposes other than for the

functions of a trademark

The CJEU considered the issue of bad faith in its decision in

Koton Magazacilik Tekstil Sanayi ve Ticaret v. EUIPO.

A related

Spanish national decision between the two parties is also reported

in Part IV.C.5 of this Review. On April 25, 2011, Mr. Nadal Esteban

(Esteban) filed an application for the registration of a figurative

mark (see Figure 1) as an EUTM for classes 25, 35, and 39. Koton

Magazacilik Tekstil Sanayi ve Ticaret (Koton) filed a notice of

opposition in reliance of two earlier registered trademarks in the

EUIPO and in Malta (see Figure 2), both of which covered classes

25 and 35.

Figure 1

Figure 2

The opposition was upheld for both classes 25 and 35 but

rejected for class 39. The mark was subsequently registered under

class 39 on November 5, 2014. In response, Koton filed an

application for invalidity on the basis that Esteban had acted in bad

faith under Article 52(1)(b) of the 2009 EUTM Regulation.

The Cancellation Division of the EUIPO rejected the application

for a declaration of invalidity of the mark at issue, and the appeal

to the Second Board of Appeal of EUIPO was dismissed. The

General Court subsequently upheld the decision to dismiss the

invalidity application, finding that there could be no bad faith, as

there was neither identicality nor similarity capable of causing

confusion between the goods or services of Koton’s earlier marks and

the services in class 39 for which the mark at issue had been

registered.

Case C-104/18P (CJEU, September 12, 2019) (EU:C:2019:724).

This provision is now at Article 59(1)(b) of the 2017 EUTM Regulation.

Vol. 110 TMR 537

Koton subsequently appealed to the CJEU. Before the CJEU’s

ruling, Advocate General Kokott (“AG”) gave her opinion and

concluded that the approach of the General Court had been

incorrect. The General Court had ruled that bad faith presupposes

that a third party is already using an identical or similar sign for an

identical or similar product or service capable of being confused with

the mark being registered. In fact, the ground for invalidity under

Article 52(1)(b) of the 2017 EUTM Regulation does not require the

applicant of an invalidity action to be the proprietor of an earlier

mark but allows for any party to apply for a declaration of invalidity

on the grounds of bad faith.

The AG opined that it is necessary for the EUIPO and the courts

to take into account all the relevant factors of bad faith, including

the General Court and the CJEU’s historical rulings of bad faith in

situations where the applicant of an application to register a

trademark (1) did not aim to use the mark in accordance with its

essential function;

(2) did not intend to use the trademark but

intended to use the trademark to mislead consumers;

(3) applied

with the sole purpose of preventing an imminent trademark

application made by others;

and (4) wanted to establish the basis

for acquiring a descriptive domain name.

In addition, the AG noted that the General Court had failed to

consider a key factor of the overlap of goods and services in classes

25 and 35 between the mark at issue, when the application to

Esteban at the time of filing the application are key to assessing

whether he was acting in bad faith. The fact that the application

was originally filed for a mark for goods and services where Esteban

knew or should have known, due to his earlier business relationship

with Koton, that identical or similar trademarks existed is an

important indication that the application to register the same mark

for other goods or services was also filed in bad faith. As the General

Court’s judgment did not consider this factor in its assessment of

bad faith, the AG proposed that the CJEU set aside the judgment of

the General Court.

The CJEU followed the AG’s reasoning and set aside the

judgment of the General Court. Before assessing the General

Court’s ruling, the CJEU made the distinction between the concept

of “bad faith” in everyday use, which presupposes a state of mind or

dishonest intention, and the concept of “bad faith” in EU trademark

Chocoladefabriken Lindt & Sprüngli AG v. Franz Hauswirth GmbH, Case C-529/07

(CJEU, June 11, 2009) (EU:C:2009:361), at paras. 44 and 45.

Internetportal und Marketing GmbH v. Richard Schlicht, Case C-569/08 (CJEU, June 3,

2010) (EU:C:2010:311), at paras. 46 to 48.

Copernicus-Trademarks v. EUIPO, Case T-82/14 (GC, July 7, 2016) (EU:T:2016:396).

Internetportal und Marketing GmbH v. Richard Schlicht, Case C-569/08 (CJEU, June 3,

2010) (EU:C:2010:311), at paras. 46 to 47.

538 Vol. 110 TMR

law, which relates to use in trade and ensuring fair competition. The

CJEU clarified that a trademark must be declared invalid on the

ground of bad faith under two circumstances:

1. where it is clear from all relevant considerations that the

applicant, at the time of filing the application to register,

intended to undermine the interests of third parties,

especially if filed in a manner inconsistent with engaging in

fair competition or honest practices; or

2. where the applicant, at the time of filing the application to

intended to obtain an exclusive right for purposes other

than those falling within the functions of a trademark,

especially in relation to the essential function of indicating

origin.

The CJEU disagreed with the General Court’s findings that the

existence of bad faith may be established only where there is use in

the course of trade of an identical or similar sign for identical or

similar goods or services capable of being confused with the mark at

issue. Instead, the CJEU agreed with the AG by clarifying that

there is no requirement whatsoever that the applicant for the

declaration of invalidity be the proprietor of an earlier mark for

identical or similar goods or services, nor does a likelihood of

confusion need to be established.

The AG’s opinion on the General Court’s failure to consider the

overlap of goods and services was also followed by the CJEU. It

found that the General Court did not consider all relevant factual

circumstances at the time the application for declaration of

invalidity was filed, including the fact that Koton applied to declare

the mark at issue invalid in its entirety. The CJEU left it with the

competent body of the EUIPO to adopt a new decision on the

application of invalidity following its ruling on how the ground of

invalidity on the basis of bad faith should be assessed.

The CJEU did not (on this occasion, but see the later Skykick

decision on this point) take the opportunity to provide clarity on the

divisibility of a trademark application filed partly in bad faith,

finding only that such divisibility is plausible when read in

conjunction with Article 52(3) of the 2009 EUTM Regulation,

which provides that an EUTM may be declared invalid in respect of

only some of its registered goods or services. Notably, the AG had

observed that the division of an application for registration into an

application partly filed in bad faith and partly filed in good faith

may offer an incentive, and therefore amount to an abuse of the

trademark system, to apply to register trademarks for a larger set

of goods and services than justified by the actual intended use.

This provision is now at Article 59(3) of the 2017 EUTM Regulation.

Vol. 110 TMR 539

2. EU—CJEU—Can an EUTM be declared wholly or

partially invalid on the grounds of bad faith arising

from a lack of intention to use the EUTM

under some of the specified goods and services and

on the basis of the specification of the goods and

services lacking sufficient clarity or precision?

Following the reference from the English High Court in Sky PLC

and others v. SkyKick UK Ltd. and another,

on January 29, 2020,

the CJEU

provided its answer on the five questions relating to the

scope of possible grounds for invalidity, the requirements for a

finding of bad faith, and whether a trademark can be invalidated in

whole or in part in relation to specific goods or services.

The questions referred by the High Court were as follows:

(1) Can an EU trade mark or a national trade mark

registered in a Member State be declared wholly or

partially invalid on the ground that some or all of the

terms in the specification of goods and services are

lacking in sufficient clarity and precision to enable the

competent authorities and third parties to determine on

the basis of those terms alone the extent of the

protection conferred by the trade mark?

(2) If the answer to question (1) is yes, is a term such as

“computer software” too general and covers goods which

are too variable to be compatible with the trade mark’s

function as an indication of origin for that term to be

sufficiently clear and precise to enable the competent

authorities and third parties to determine on the basis

of that term alone the extent of the protection conferred

by the trade mark?

(3) Can it constitute bad faith simply to apply to register a

trade mark without any intention to use it in relation to

the specified goods or services?

(4) If the answer to question (3) is yes, is it possible to

conclude that the applicant made the application partly

in good faith and partly in bad faith if and to the extent

that the applicant had an intention to use the trade

mark in relation to some of the specified goods or

services, but no intention to use the trade mark in

relation to other specified goods or services?

[2018] EWHC 155 (Ch) (February 6, 2018). See Tom Scourfield, Annual Review of EU

Trademark Law: 2018 in Review, 109 TMR 441, 503-505 (2019).

Sky PLC and Others v. Skykick UK Ltd. and Skykick Inc., Case C-371/1 (CJEU, January

29, 2020) (EU:C:2020:45).

540 Vol. 110 TMR

(5) Is Section 32(3) of the UK Trade Marks Act 1994

compatible with [Directive 2015/2436] and its

predecessors?

In providing its guidance in respect of the questions referred,

notably the CJEU chose not to endorse the analysis of certain issues

by Advocate General Tanchev in his opinion in the case.

Clarity and precision requirement

(Question 1 and Question 2)

The first issue, in respect of the first and second questions

referred to the CJEU, is whether an EUTM registration can be

declared wholly or partially invalid on the grounds that terms used

in the specification of that mark lack clarity and precision.

The CJEU’s first consideration was to determine whether a lack

of clarity and precision of the terms used in the specification of a

mark is, in itself, a ground for invalidity. In agreeing with AG

Tanchev’s opinion, the CJEU confirmed that this is not a ground for

invalidity under Article 3 of EU Directive 89/104

(now amended

and recast as the 2015 TM Directive) and Articles 7 and 51 of

Council Regulation No 40/94

(now amended and recast as the 2017

EUTM Regulation), both of which are considered exhaustive lists

under their respective EU legislative instruments.

The CJEU

added that its judgment in the IP Translator case

cannot be

interpreted as intending to recognize additional grounds for

invalidity not included in the exhaustive lists of grounds of

invalidity previously mentioned.

The second consideration for the CJEU was whether a lack of

clarity and precision of the terms used in the specification of a mark

could fall within one of the existing grounds for invalidity. In this

respect, the CJEU clarified the scope of two grounds of invalidity:

(a) SkyKick had suggested that the lack of clarity and precision

of terms used in the specification of a mark was related to

the requirement of graphic representability. The CJEU

rejected this argument and considered its judgment in

Sieckmann whereby, although graphically represented

signs must be represented with clarity and precision for the

purposes of identifying the inherent trademarks, it cannot

be inferred that the requirement of clarity and precision

This provision is now found at Article 4 of the 2015 TM Directive.

These provisions are now found at Articles 7 and 59 of the 2017 EUTM Regulation.

See Recital 7 of the First Council Directive 89/104 (now found at Recital 14 of the 2015

TM Directive) and Article 96(1) of the Council Regulation No. 40/94 (now found at Article

128(1) of the 2017 EUTM Regulation).

Chartered Institute of Patent Attorneys v. Registrar of Trade Marks, Case C-307/10

(CJEU, June 19, 2012) (EU:C:2012:361).

Vol. 110 TMR 541

should also apply to the terms used to refer to the goods and

services designated to that trademark.

(b) By contrast, AG Tanchev had suggested that unclear and

imprecise terms may be contrary to the public interest, and

liable to be invalidated on that basis. As an example, AG

Tanchev had specified that a term such as “computer

software” was too general and covered such a wide range of

goods and services that it is unjustified and contrary to

public policy. The CJEU disagreed, ruling that the concept

of public policy cannot refer to the characteristics

concerning the trademark application itself, such as the

clarity and precision of the terms used in the specification of

a mark.

Ultimately, the CJEU ruled that a lack of clarity and precision

of terms used in the specification of a mark is not a ground for

invalidity. Issues relating to the scope of a specification can be dealt

within the non-use mechanisms for trademark law. The CJEU noted

that a mark registered under a range of goods and services in a

manner that lacks clarity and precision is capable of being protected

only in respect of the specific goods and services for which it has

been put to genuine use. Where a mark has not been put to genuine

use within a continuous period of five years in relation to specific

goods or services to which it is registered, the mark may be revoked

in respect of those goods and services (only).

Bad faith (Questions 3–5)

The second issue addressed by the CJEU, in respect of the third

and fourth questions referred to it, is whether a mark application

made without any intention to use the trademark in relation to the

goods and services listed constitutes bad faith as a basis for

invalidity and, if so, whether the mark will be wholly invalidated or

only partly invalidated regarding the goods and services subject to

bad faith.

The CJEU noted that neither Article 3(2)(d) of the EU Directive

89/104

nor Article 51(1)(b) of Council Regulation 40/94

provides

a definition of the concept of bad faith, it being an autonomous

concept of EU law. The concept of bad faith presupposes the

presence of a dishonest state of mind or intention that is

inconsistent with the fundamental EU rules on trademark law.

Drawing upon its judgment in Koton

100

(see Part IV.A of this

Review) in late 2019, the CJEU reiterated that the function of a

This provision is now at Article 59(1)(b) of the 2015 TM Directive.

This provision is now at Article 52(1)(b) of the 2017 EUTM Regulation.

100

Koton Magazarailik Tekstil Sanayi v. EUIPO, Case C-104/18P (CJEU, September 12,

2019) (EU:C:2019:724).

542 Vol. 110 TMR

mark is aimed at undistorted competition to enable a consumer to

distinguish goods or services between undertakings in order to be

able to choose (or avoid) purchasing it again.

The CJEU noted that, at the time of filing an EUTM application,

the applicant is not required to indicate or even to know precisely

the use it will make of the trademark applied for. In any case, that

applicant has a period of five years for beginning actual use

consistent with the essential function of that trademark as

confirmed by the CJEU in the #daferdas? case

101

(see Part V.C.3 of

this Review).

In agreeing with this aspect of AG Tanchev’s opinion, the CJEU

confirmed that the registration of a trademark without any

intention to use in relation to the specific goods and services covered

by that registration may constitute bad faith depending on the wider

circumstances. Establishing bad faith will depend on whether there

is “objective, relevant and consistent indicia” demonstrating that, at

the time of filing the application, the applicant had the intention of:

(a) undermining, in a manner inconsistent with honest

practices, the interests of third parties; or

(b) obtaining, without even targeting a specific third party, an

exclusive right for purposes other than those falling within

the functions of a trademark.

There is therefore no automatic finding of bad faith on the basis

that the applicant had no economic activity corresponding to the

goods and services listed in the trademark application.

In relation to the fourth question, the CJEU ruled that, where

there is a finding of bad faith, the invalidity of that mark covers only

those goods or services for which a finding of bad faith is present.

In considering the fifth question, which relates to the issue of

showing intention of bad faith and the compatibility of Section 32(3)

of the UK Trade Marks Act 1994 with EU law, the CJEU noted that

each Member State is free to fix the provisions of procedure

concerning registration, revocation and invalidity of trademarks in

its jurisdiction. However, such provisions cannot have the effect of

introducing a ground of refusal of registration or invalidity not

provided for in the exhaustive lists mentioned. The CJEU therefore

ruled that a provision under UK law requiring a trademark

applicant to state that the trademark is being used in relation to the

goods and services in which it wishes to register the trademark is

compatible with EU law, so long as the infringement of such a

provision does not constitute a ground for invalidity.

101

Deutsches Patent- und Markenamt (#daferdas?), Case C-541/18 (CJEU, September 12,

2019) (EU:C:2019:725).

Vol. 110 TMR 543

3. EU—CJEU—Will the courts declare a mark invalid

for bad faith where there had been earlier

unsuccessful collaboration discussions between the

parties prior to registration of the mark?

In Outsource Professional Services Ltd. v. EUIPO,

102

the CJEU

considered how the courts should assess the various grounds and

circumstances when deciding whether a party had acted in bad faith

when applying to register an EUTM, including whether the parties

had attempted to engage in a commercial relationship, whether the

contested mark gave rise to a likelihood of confusion against an

earlier unregistered mark, and whether the mark is inherently

descriptive in nature.

In June 2007, a German company Outsource2India (replaced by

Outsource Professional Services in proceedings before the General

Court) (“Outsource”) filed an application to register the following

figurative EUTM:

The EUTM was registered on May 20, 2008, in relation to classes

35, 36, and 41. Flatworld Solutions Pvt. Ltd. (“Flatworld”), sought a

declaration before the EUIPO that the EUTM was invalid on the

basis of Article 52(1)(b) of the 2009 EUTM Regulation.

103

Flatworld

claimed that it had used the word element “outsource2india” as an

unregistered mark prior to June 2007 and relied upon its own

figurative EUTM containing the element “outsource2india,”

registered on May 25, 2011. Flatworld also claimed that the parties

had conducted unsuccessful discussions in relation to a potential

collaboration between 2006 and 2007.

The Cancellation Division declared the contested EUTM invalid

on the grounds of bad faith, but the Fourth Board of Appeal of the

EUIPO annulled the Cancellation Division’s decision on appeal. The

Board of Appeal concluded that it had not been proven by Flatworld

that Outsource had an intention of appropriating the element

“outsource2india” when filing to register the contested EUTM.

Further, the “outsource2india” element was descriptive within the

sector to refer to the practice of outsourcing services to India,

therefore any intention to use this common element should not be

regarded as dishonest intent.

The Board of Appeal also considered that, despite Outsource

being aware of Flatworld’s use of the “outsource2india” unregistered

102

Case C-528/18 P (CJEU, November 13, 2019) (EU:C:2019:961).

103

This provision is now at Article 59(1)(b) of the 2017 EUTM Regulation.

544 Vol. 110 TMR

word mark, Outsource had not acted in bad faith by applying to

elements in addition to that element.

On appeal by Flatworld, the General Court annulled the Board

of Appeal’s decision by finding that the contested EUTM should be

declared invalid. The General Court noted that, due to the EU’s

“first-to-file” principle for trademark registration, the mere use by a

third party of an unregistered mark does not preclude an identical

or similar mark being registered. Instead, the General Court stated

that a mark must be declared invalid where the holder of the EUTM

was, at the time of filing the application for registration, acting in

bad faith irrespective of any earlier trademark rights. Thus, the

General Court made it clear that an assessment of whether

Outsource had acted in bad faith under the Chocoladefabriken Lindt

& Sprüngli

104

criteria was required.

In reaching its decision, the General Court focused on the pre-

existing collaboration discussions between the parties and stated

that Outsource was aware that Flatworld had already been using in

Germany a “similar sign for the same services, that could be

confused with the contested mark.” It therefore examined

Outsource’s intention at the time the application to register the

contested EUTM was filed. The General Court noted that, in the

context of the unsuccessful pre-contractual relationship between the

parties, Outsource “undertook” to rename the sign it used and its

website in the event that there was no agreed collaboration. By

filing the application to register the contested EUTM after the

collaboration discussions had failed, the General Court concluded

that Outsource had acted in bad faith. The General Court also

stated that whether the element “outsource2india” was descriptive

was independent from the assessment of bad faith.

Outsource raised a single ground of appeal under Article 52(1)(b)

in support of its appeal to the CJEU. Outsource claimed that it had

not acted in bad faith as it was not demonstrated that Flatworld had

used a sign similar to the contested EUTM. It further argued that

the parties had never agreed and Outsource had never promised

that it would have “undertaken” to stop using the element

“outsource2india” if no agreement could be reached between the

parties during pre-contractual discussions. The General Court had

erred by failing to assess whether the contested EUTM and

Flatworld’s earlier unregistered mark were likely to lead to

confusion on the part of the public, as such an assessment would

have led to the conclusion that there can be no likelihood of

confusion. Outsource noted that the General Court’s judgment was

also contradictory as it includes a finding without giving reasons

when concluding that the element “outsource2india” is distinctive,

104

Case C‑529/07 (CJEU, June 11, 2009) (EU:C:2009:361).

Vol. 110 TMR 545

even though it had implicitly accepted that the element is

descriptive.

The CJEU held that, by finding that Outsource had undertaken

to change its name and website if no agreement was reached, the

General Court had indeed distorted facts and evidence as claimed

by Outsource. The General Court had merely stated that the

undertaking was apparent from the objective circumstances of the

case without specifying the particular documents to support its

view. The CJEU concluded that this finding could not therefore form

the basis for a decision that Outsource acted in bad faith. In

addition, the CJEU also observed that the General Court did not

justify its assessment that there was a likelihood of confusion

between the contested EUTM and Flatworld’s earlier mark.

However, the CJEU ruled that the finding of bad faith should

still stand because it was well-founded on other grounds. In the

absence of any likelihood of confusion, other factual circumstances

may constitute relevant indicators for establishing bad faith. The

CJEU applied recent case law,

105

including KOTON (see Part IV.C.1

of this Review) to clarify that bad faith must be established where

it is apparent from those other factual circumstances that the

EUTM holder’s intention at the time of filing the application for

registration of the EUTM was to undermine the interests of third

parties or obtain an exclusive right for purposes other than those

falling within the functions of a trademark. The CJEU therefore

considered the other factual circumstances in the present case,

including the fact that Flatworld had objected to the incorporation

of a German company with the word element “outsource2india” and

the use of that name on Outsource’s website, and that Outsource

had, up to the EUTM application date, systematically presented its

use of the word element as being linked to the proposed

collaboration.

The CJEU observed that the General Court had not contradicted

itself in finding that the potentially descriptive nature of the word

element did not prevent it from concluding that Outsource had acted

in bad faith to exploit that element using Flatworld’s reputation.

The General Court was correct in finding that Outsource had acted

in bad faith by filing, shortly after Flatworld refused cooperation,

the application to register the contested EUTM specifically

containing that element that Flatworld had been using in its

commercial activities.

105

Koton Mağazacilik Tekstil Sanayi ve Ticaret v. EUIPO, Case C-104/18 P (CJEU,

September 12, 2019) (EU:C:2019:724), para. 46.

546 Vol. 110 TMR

4. EU—General Court—When might an applicant

be acting in bad faith in cases relating to the

registration of famous names as trademarks?

Carlos Moreira v. EUIPO

106

concerned the appeal to the General

Court by the appellant in respect of the EU trademark registration

for the word mark NEYMAR applied for “clothing, footwear and

headgear” in class 25. The mark was registered by the EUIPO in

April 2013.

In February 2016, the well-known Brazilian footballer Neymar

Da Silva Santos Júnioron, better known simply as “Neymar,”

succeeded in his application for a declaration of invalidity against

the mark in respect of all goods registered. Neymar submitted that

the appellant had acted in bad faith in registering the mark owing

to his celebrity. The Second Board of Appeal of the EUIPO agreed,

dismissing the appellant’s appeal on the basis that the appellant

had been aware of Neymar’s fame at the time of the application and

intended to take advantage of this.

Appealing to the General Court, the appellant argued that the

Board of Appeal had wrongly determined that he had acted in bad

faith. In particular, he argued that the Board of Appeal had

incorrectly assumed that he knew that Neymar was a rising star in

the football world. The appellant submitted that Neymar was

relatively unknown in Europe at the time of the application and that

he could not therefore be deemed to have filed the contested mark

in order to exploit Neymar’s fame.

Rejecting the appellant’s submissions, the General Court held

that the appellant had intentionally sought registration to create an

association with the footballer Neymar. In particular, the General

Court noted that the mark is identical to the name he is famous for

(as opposed to his full name) and therefore the argument that the

use was a mere coincidence could not be true. In addition, the

General Court held that the existence of bad faith on the part of an

applicant must be assessed in the light of their intention at the time

of filing for the application.

107

Given the press evidence

demonstrating Neymar’s fame in Europe and the Appellant’s

application for the CASILLAS mark, the Board of Appeal had not

erred in law by concluding that at the time of filing, the application

was to take advantage of Neymar’s reputation.

106

Case T-795/17 (2019).

107

Chicoladenfabriken Lindt & Sprungli, Case C-529/07 (EU:C:2009:361).

Vol. 110 TMR 547

5. Spain—Appeal Court of Madrid—

What is the interconnection between

bad faith and genuine trademark use?

The decision of the Appeal Court of Madrid on October 30, 2018,

in Koton

108

considers the interaction between bad faith and genuine

use of a trademark.

By way of background, on January 20, 2014, the plaintiff,

Turkish fashion company Koton Magazacilik (www.koton.com) had

filed a trademark invalidity action against its former distributor,

Mr. Joaquin Nadal Esteban, seeking to invalidate two Spanish

trademarks on the basis that both marks had been filed in bad faith.

The relevant trademarks were Spanish Trademark Registrations

No. 2578587 KOTON (fig.) in class 25, filed in 2004, and No.

2964895 KOTON (fig.) in class 35, filed in 2011. The defendant had

distributed the plaintiff’s KOTON-branded products from 2003 to

2006.

The defendant, in return, denied bad faith and counterclaimed

seeking revocation on the basis of non-use for the Spanish element

of the plaintiff’s International Trademark Registration No. 777048,

KOTON, registered in 2003 in classes 18, 25, and 35.

IR No. 777048

ES-2578587 / ES-2964895

Koton Magazacilik opposed the counterclaim on the basis of two

grounds. First, it denied non-use, maintaining that there had been

genuine use of the trademark within the relevant period through

another distributor. Secondly, it argued that the revocation

counterclaim should, in fact, be considered in separate proceedings,

not consolidated in the invalidity action, as the invalidity action had

been filed on the basis of bad faith and not in respect of the

similarity with the earlier international trademark.

The Commercial Court of Madrid upheld the counterclaim,

revoking the international registration (“IR”) trademark for non-

use, and rejected the complaint for invalidity. The court considered

that the lack of use of the KOTON trademark in Spain was a

108

Koton Magazacilik Tekstil Sanayi Ve Ticaret A.S. v. Joaquin Nadal Esteban (judgment

594/2018 in appeal case 236/2017).

548 Vol. 110 TMR

decisive factor, as it showed a lack of interest in exploiting the mark

in Spain and, for this reason, similarly found that there could be no

bad faith on the part of its distributor, Mr. Esteban.

The decision was appealed before the Appeal Court of Madrid.

In its judgment, the Appeal Court confirmed the revocation for non-

use of IR No. 777048 (KOTON) due to lack of evidence. The sole

evidence of use amounted to the delivery of 571 garments in the five

years preceding the complaint, which was held to be insufficient.

However, the Appeal Court disagreed with the first instance

decision that the lack of use of the earlier mark automatically meant

that there was no bad faith on the part of the defendant. The Court

based its findings on the criteria established by the judgments of the

CJEU in Lindt

109

and the judgments of the General Court in Peeters

Landbouwmachines

110

and DOGGIS.

111

The Appeal Court considered the conduct of the defendant on a

range of criteria. First, at the time of making the application, the

defendant was aware that that a third party with whom he had a

(previous) commercial relationship was using an almost identical

mark. The oldest of the marks whose invalidity was sought had been

filed in 2004, only nine months after the plaintiff had registered IR

No. 777048 KOTON for the same goods. At that moment, the earlier

trademark was registered and in use. The same point could also be

made in respect of the KOTON trademark filed by the Spanish

distributor in January 2011. The Appeal Court considered that the

last delivery of goods to Spain was sent in February 2006 and the

youngest trademark had been filed in January 2011, so at that time

the five-year use period had not yet elapsed. International

Registration No. 777048 (KOTON) was at that time still registered

and in use.

Secondly, consideration of the defendant’s intention was also

relevant. The defendant had declared in evidence that the aim of

registering the marks was to protect the Turkish company Koton

Magazacilik and prevent a third party from registering the

trademark of his principal in Spain. However, the facts showed that

this was untrue. The Turkish company in fact already owned a

trademark registration in Spain (IR No. 777048), even if it now had

to be cancelled for non-use. Further, Mr. Esteban had also opposed

the EU Trademarks of Koton Magazacilik so this should be

interpreted as an intention to prevent use of the mark.

Finally, using the wording of the General Court in DOGGIS, the

Appeal Court of Madrid considered that filing a trademark that was

identical in wording and almost identical in its figurative element

to the trademark of the Turkish company (who at the relevant time

109

Chocoladefabriken Lindt, Case C-529/07 (CJEU, June 11, 2009).

110

Peeters Landbouwmachines, Case T-33/11, February 14, 2012.

111

Case T-335/14 DOGGIS, January 28, 2016.

Vol. 110 TMR 549

was engaged in rapid expansion in Europe) was against all

commercial logic and could only be interpreted as an intention of

misappropriating a trademark of a third party. Ultimately, the

trademarks of both parties were cancelled.

6. UK—High Court—Can an applicant’s activities on

unrelated actions be taken into account when

considering if an application was made in bad faith?

In Trump International Ltd. v. DTTM Operations LLC,

112

the

UK High Court considered an appeal against a UKIPO decision in

relation to a trademark filed in bad faith.

On October 30, 2016, Trump International (one of many entities

owned by Mr. Michael Gleissner) applied to register the words

“TRUMP TV” as a UK trademark. The application was made in

respect of class 38 (communication and broadcasting) and class 41

(entertainment and education). Trump International has no

connection with Mr. Donald Trump, who, at the date of the

application, was running for election as President of the United

States. An opposition was brought by DTTM, which holds and

administers trademark registrations previously owned by Mr.

Trump.

DTTM advanced four grounds of opposition under the Trade

Marks Act 1994. DTTM alleged that the application was filed in bad

faith (section 3(6)). DTTM cited a likelihood of confusion with its

earlier EU trademarks, the word mark TRUMP and a word and

device mark TRUMP & CREST DEVICE, registered for goods and

services identical or similar to the TRUMP TV application (section

5(2)(b)) DTTM also relied on the extended protection offered to

marks with a reputation (section 5(3) of the Act). Lastly, DTTM

claimed earlier unregistered rights in relation to the trademark

TRUMP, used throughout the UK since at least 2007 and that use

of the mark TRUMP TV would amount to the common law tort of

passing off (section 5(4) of the Act).

DTTM filed extensive evidence of the past activities of Mr.

Gleissner’s companies,

113

DTTM’s trademark rights, and the lack of

connection between DTTM and Trump International. Trump

International filed no evidence, although it did assert that Trump

International should benefit from its corporate veil (i.e., it should be

treated as legally distinct from Mr. Gleissner).

Neither party requested a hearing, so the decision was made on

the basis of the written submissions. The Hearing Officer concluded

that the application had been made in bad faith and refused the

112

[2019] EWHC 769 (Ch) (March 29, 2019).

113

Including evidence in relation to Sherlock Systems CV v. Apple Inc. Decision O/015/17;

[2017] FSR 30 (“Apple” or the “Apple case”) and CKL Holdings Limited v. Paper Stacked

Limited Decision O/036/18 (“Alexander” or the “Alexander case”)

550 Vol. 110 TMR

application in its entirety. He declined to consider the other grounds

of opposition.

Trump International appealed to the High Court, advancing two

general grounds of appeal: i) the Hearing Officer had made errors of

law or principle in reaching his conclusion on the evidence before

him that the application had been filed in bad faith; and ii)

alternatively, permission to adduce additional evidence on appeal

should be granted to such evidence demonstrating that the

application had not been filed in bad faith.

In relation to the first ground of appeal, Trump International

argued that, in making his finding of bad faith, the Hearing Officer

wrongly accepted and relied upon the evidence of Mr. Gleissner’s

activities in unrelated actions. Trump International contended that

Mr. Gleissner was not a party to the proceedings but, having been

convinced that Mr. Gleissner was a “bad apple,” the Hearing Officer

then allowed prejudice and bias to influence his decision. The judge

firmly rejected any allegations of actual or apparent bias. Evidence

of Mr. Gleissner’s activities was relevant and admissible (as it was

in the Alexander case

114

). The Hearing Officer was right on the basis

of this evidence to make a prima facie finding of bad faith, which

Trump International failed to file evidence to rebut.

Trump International also argued that the Hearing Officer erred

in failing to make any findings in relation to the other grounds of

opposition, while taking such grounds into account in awarding

costs. There was no separate appeal in relation to costs, so this

ground of appeal was unsustainable. Further, because the finding

of bad faith was correct, a finding on the other grounds of opposition

would not have changed the outcome for Trump International.

Nevertheless, the High Court emphasized that as a matter of good

practice, the Hearing Officer should have stated his conclusions on

the other grounds. It was obvious that these grounds would have

been made out, but had the appeal on bad faith succeeded, it might

have become necessary to remit the case to the Hearing Officer.

In relation to the second ground of appeal, Trump International

filed three additional witness statements that it sought permission

to adduce on appeal. This application failed. The High Court found

that such evidence could have been filed before the first instance

hearing, the evidence was not credible, and it would not have made

a difference to the result of the case in any event.

In a comparatively rare development, the Comptroller General

of Patents, Designs and Trade Marks was also granted permission

to intervene on the appeal. As the High Court noted, this was the

first opportunity the High Court had had to consider a case

involving Mr. Gleissner. The submissions on behalf of the

comptroller focused on “the nature and scale of the problem

114

Decision O-036-18.

Vol. 110 TMR 551

presented by Mr Gleissner’s activities,” illustrated in part by the

fact that by 2016, Gleissner entities had applied for over 800 UK

trademarks; as at November 30, 2017, Gleissner entities were

involved in 97 live contested trademark cases before the UK IPO

(constituting 5% of the total cases at that time); and that Gleissner

entities had 49 unpaid costs orders against them.

The comptroller requested guidance from the High Court as to

how the UKIPO should deal with such applications in the future.

The High Court generally endorsed the approach taken by the

UKIPO to date but offered the following further guidance:

Firstly, the registrar may strike out proceedings brought for an

ulterior and improper purpose as an abuse of process. The power to

strike out must be exercised with caution. However, where a prima

facie case of bad faith is established, and no evidence in answer is

filed on behalf of the applicant, it may well be appropriate to

exercise that power. Additionally, the High Court emphasized that

Section 32(3) of the Act requires that a trademark applicant must

state its good faith intention to use the mark applied for. If such a

statement is made in respect of a well-known third-party trademark

to which the applicant has no connection, this may give rise to an

infringement claim. The court is empowered in such circumstances

to grant various remedies in an infringement claim, including

preliminary injunctions and non-party costs orders.

7. Poland—Polish District Administrative Court

(DAC)—What conditions and circumstances support

the allegation that the trademark

has been registered in bad faith?

The judgment of the Polish Administrative Court (DAC) in

RENOLAK

115

considers the issue of bad faith in the invalidation of

a trademark.

In 2006, two individual traders who had been engaged in the

retail sale of paints and varnishes applied to register the mark

RENOLAK for enamel and wall paint. The trademark was

eventually registered in 2012. The holders of the disputed

trademark registration had not used the mark before the

application for registration was filed and had not undertaken any

real activity in order to commence genuine use of the mark, either

during the registration process, or after it had concluded.

By way of background, signs containing the word RENOLAK

(such as SIGMA RENOLAK, AUTORENOLAK) had been used in

the course of trade in Poland for almost forty years by PPG Polifarb

Cieszyn S.A. (“PPG”), an entity that was part of a holding owned by

the Polish state. Its business consisted of the production of paint

115

Judgment of the DAC of 2.08.2018, VI SA/Wa 2224/17, LEX no. 2738488.

552 Vol. 110 TMR

and varnish. PPG made no application to register the trademark

RENOLAK for its own benefit but started using this trademark in

2006 as continuation of its former use of SIGMA RENOLAK and

AUTORENOLAK trademarks.

Immediately after obtaining the trademark registration for

RENOLAK, the two proprietors sent a cease and desist letter to

PPG, in which they demanded PLN 10 million (approximately USD

2.5 million) for infringement of the contested trademark. As a result,

the company started invalidation proceedings against the new

registration on the grounds that it aimed to block its current

activities on the market and had been applied for in bad faith.

At first instance the Polish Patent Office (PPO) rejected the

application for invalidation. The PPO based its decision primarily

on the (wrong) assertion that there was no bad faith on the part of

trademark owners since PPG had not registered the same or even

similar trademarks before the application for registration of the

disputed trademark was made. There is no such requirement to

establish bad faith under Polish law.

An appeal was filed by PPG to Polish District Administrative

Court (“DAC”). The DAC overturned the first instance decision and

referred the case back to the PPO for rehearing, setting out a

number of conditions to be reexamined by the PPO in order to

determine whether the registration was made in bad faith.

The DAC pointed out that it was apparent from the material on

file that the applicant and its legal predecessors had marketed goods

with signs such as SIGMA RENOLAK or AUTORENOLAK prior to

the date of filing of the application for registration of the contested

mark. Such use of the marks containing the word RENOLAK in the

course of trade was an essential objective factor for assessing

whether registration of the contested mark was made in bad faith.

The intention of the proprietors making the application for

registration was also relevant, particularly where an application is

made in order to eliminate a competitor from the market with the

intention of taking over its customers.

According to the DAC, a person acts in bad faith when he knows

(or with due diligence should have known) of the actual use of the

mark by another trader and, anticipating his application for

registration of the mark, applies for protection of the similar

trademark himself. The Court also indicated several circumstances

that should have supported the plea of bad faith. This included the

fact that the holders of the disputed mark were not conducting any

business activity relating to the production of paint at the time of

filing the application for registration and they had not commenced

any genuine use of the trademark by the time the trademark was

eventually registered in 2012 some six years after the original

application. In turn, the applicant for invalidity had been trading

under a similar mark prior to the application for registration of the

Vol. 110 TMR 553

disputed mark, a business activity that gave them knowledge about

use of similar trademarks for paints by the applicant for invalidity.

In its judgment, the DAC distinguished between two situations

that might be qualified as bad faith filing. First, where the

application for registration of a mark is made to block use or

registration by another entity and second, where the application for

registration of the mark is made for speculative purposes. In the

case at hand, the lack of intention to use should be understood as

the absence of any intention to use of the trademark for goods

covered by the application for registration. Where the application is

made to block use or registration by another entrepreneur, the lack

of intention to use is to be understood as a lack of specific intention

to use. The application for speculative purposes is characterized by

simultaneous filing claims for compensation and forcing entities

using the trademark to make concessions or buy back the disputed

signs.

After the case was returned to the PPO and reexamined

following the guidance from the DAC, the RENOLAK trademark

was invalidated.

116

In the opinion of the PPO, the holders of the

trademark did not demonstrate that they had started genuine use

of the trademark and all actions taken by them in this respect were

purely fictitious. Further, the evidence submitted proved that

trademark owners had knowledge of the earlier similar marks used

by another entity before the application for registration of the

RENOLAK trademark was filed. The PPO concluded that

application for registration of the trademark was made in bad faith

and was intended to block access of another business (PPG) to the

market. All of these facts established sufficient grounds to apply for

declaration of invalidity on the grounds of bad faith.

V. USE OF A TRADEMARK

A. Introductory Comments

This Part V includes cases with a common theme where the

central question to be considered relate to “use of a trademark.”

Questions of use of a trademark arise in a wide variety of ways in

EU trademark law, including how a mark is used (such as the

manner, form, genuine nature, and intention of use), when

(duration of use) and where (territory of use) in relation to what

goods and services (as against a mark’s specification), as well as how

such use is perceived by the average consumer and the consequences

arising from such perception.

Neither the 2008 TM Directive nor the 2017 EUTM Regulation

require that a trademark should be in use before the mark may be

116

Decision of the PPO of 5.11.2019, Sp.40.2019.

554 Vol. 110 TMR

registered. Similarly, there is no requirement that the trademark

owner should prove ongoing (or indeed any) use of the trademark

upon the administrative act of renewal of the registration, or at any

other periodic interval. Nevertheless, the EU trademark regime

operates on a “use it or lose it” principle. An EU trademark becomes

vulnerable to attack on grounds of non-use once it has been

registered for five years. A similar rule applies in relation to

trademarks registered with national EU trademark authorities.

The CJEU’s decision in #daferdas, considered in this Part V,

emphasized that there is no requirement for an applicant to indicate

the use it will or intends to make of the mark applied for, or even to

know precisely what such use might be, since the applicant has a

period of five years to commence the actual use, provided such use

is consistent with the essential function of a trademark.

As noted in Part II of this Report, trademarks that may initially

be lacking distinctiveness, that are descriptive, or that might be

considered generic can, in principle, be overcome by persuasive

evidence that the trademark has acquired distinctiveness among

the relevant class of consumers through the use made of it (Article

7(3) of the 2017 EUTM Regulation and Article 3(3) of the 2008 TM

Directive).

117

Aside from acquired distinctive character, the question of

whether or not a mark is in use at any given time most commonly

arises in two contexts. The first is where the registration of the mark

is made the subject of a revocation attack on the specific grounds of

non-use, which may happen on a stand-alone basis or as a

counterclaim in infringement proceedings. The second is where the

trademark in question is the basis of an “earlier right” used to

challenge a third party’s trademark application or registration, or

in an infringement claim. In this latter situation, the third party

may require, if the challenger’s mark is at least five years old, that

“proof of use” be provided. To the extent that such proof is not then

provided, the earlier right is disregarded for the purposes of the

challenge.

The main provisions concerning the revocation of an EU

trademark on the ground of non-use are found in Articles 18 and

58(1) of the 2017 EUTM Regulation (previously Articles 15 and 51(1)

of the 2009 EUTM Regulation). The parallel provisions in relation

to the trademark registrations on the registers of EU Member

States are set out in Articles 10 and 12 of the 2008 TM Directive

(see now Articles 16 and 19 of the 2015 TM Directive). Although not

expressly considered in this Part V, note that the CJEU’s finding in

Skykick in Part IV of this Review will have the practical effect of

focusing questions of breadth and extent of specification from the

117

This provision is now found at Articles 4(4) and 4(5) of the 2015 TM Directive. Note the

new wording inserted into the second sentence of Article 4(5) of the 2015 TM Directive.

Vol. 110 TMR 555

issue of bad faith to one of proof of use at the expiry of the relevant

five-year period.

The main provisions relating to “proof of use” in connection with

challenges to third-party marks are set out in Articles 47, 64(2), and

127(3) of the 2017 EUTM Regulation (previously Articles 42, 57(2),

and 99(3) of the 2009 Regulation, respectively) and Article 11 of the

2008 TM Directive (in the 2015 TM Directive, see Articles 17, 44,

and 46).

The cases analyzed in this Part V reflect the above

considerations. Two cases consider the type and nature of use made

by the proprietor, in particular as to whether the use made, or

contemplated, would be in accordance with the essential function of

a trademark to demonstrate origin. The CJEU considered whether

use on packaging would be perceived as an indication of

ingredients/content or one of origin. In #daferdas, the CJEU

provided clarity on variable modes of use (on a reference from the

German courts), finding that where the relevant custom and

practice demonstrated a potential for several potential uses of a

mark, the examiner would need to consider all of these to determine

whether the average consumer would perceive the mark as an

indication of commercial origin and, therefore, whether the sign had

distinctive character. The CJEU also considered the relevance of

dotted or solid lines indicating the likely placement of a figurative

or position mark in determining genuine use of that trademark, as

well as analyzing the extent and geographical spread of evidence of

use filed in support of a claim to acquired distinctive character of an

EUTM for a three-dimensional mark for guitars. Finally, national

courts in Spain and Poland considered evidence filed to rebut

revocation for non-use, clarifying the relevant tests as to the nature

of evidence required and relevant time frames for such evidence.

B. Legal Texts

Article 7 of the 2017 EUTM Regulation

Absolute grounds for refusal

1. The following shall not be registered:

(Note: paragraph (a) was omitted.)

(b) trade marks which are devoid of any distinctive

character;

indications which may serve, in trade, to designate

the kind, quality, quantity, intended purpose, value,

geographical origin or the time of production of the

goods or of rendering of the service, or other

characteristics of the goods or service;

556 Vol. 110 TMR

(d) trade marks which consist exclusively of signs or

indications which have become customary in the

current language or in the bona fide and established

practices of the trade;

. . .

2. Paragraph 1 shall apply notwithstanding that the

grounds of non-registrability obtain in only part of the

Union.

3. Paragraph 1(b), (c) and (d) shall not apply if the trade

mark has become distinctive in relation to the goods or

services for which registration is requested in

consequence of the use which has been made of it.

(Emphasis added.)

Article 3 of the 2008 TM Directive

1. The following shall not be registered or, if registered,

shall be liable to be declared invalid:

(Note: paragraph (a) was omitted.)

(b) trademarks which are devoid of any distinctive

character;

indications which may serve, in trade, to designate

the kind, quality, quantity, intended purpose, value,

geographical origin, or the time of production of the

goods or of rendering of the service, or other

characteristics of the goods or services;

(d) trademarks which consist exclusively of signs or

indications which have become customary in the

current language or in the bona fide and established

practises of the trade;

(Note: paragraph 2 was omitted.)

3. A trade mark shall not be refused registration or be

declared invalid in accordance with paragraph 1(b), (c) or

(d) if, before the date of application for registration and

following the use which has been made of it, it has

acquired a distinctive character. Any Member State may

in addition provide that this provision shall also apply

where the distinctive character was acquired after the

date of application for registration or after the date of

registration. (Emphasis added.)

. . .

Vol. 110 TMR 557

Article 18 of the 2017 EUTM Regulation

1. If within a period of five years following registration, the

proprietor has not put the EU trade mark to genuine use

in the [European Union] in connection with the goods or

services in respect of which it is registered, or if such use

has been suspended during an uninterrupted period of

five years, the EU trade mark shall be subject to the

sanctions provided for in this Regulation, unless there

are proper reasons for non-use.

The following shall also constitute use within the

meaning of the first sub-paragraph:

(a) use of the EU trade mark in a form differing in

elements which do not alter the distinctive character

of the mark in the form in which it was registered,

regardless of whether or not the trademark in the

form as used is also registered in the name of the

proprietor.

(b) affixing of the EU trade mark to goods or to the

packaging thereof in the EU solely for export

purposes.

2. Use of the EU trade mark with the consent of the

proprietor shall be deemed to constitute use by the

proprietor.

(Note: The wording “regardless of whether or not the

trademark in the form as used is also registered in the name

of the proprietor” is new, and reflects case law under the old

2009 EUTM Regulation.)

Article 47 of the 2017 EUTM Regulation

. . .

1. If the applicant so requests, the proprietor of an earlier

EU trade mark who has given notice of opposition shall

furnish proof that, during the period of five years

preceding the date of publication of the EU trade mark

application, the earlier EU trade mark has been put to

genuine use in the Union in connection with the goods or

services in respect of which it is registered and which he

cites as justification for his opposition, or that there are

proper reasons for non-use, provided the earlier EU trade

mark has at the date been registered for not less than five

years. In the absence of proof to this effect, the opposition

shall be rejected. If the earlier EU trade mark has been

used in relation to part only of the goods or services for

which it is registered it shall, for the purposes of the

558 Vol. 110 TMR

examination of the opposition, be deemed to be registered

in respect only of that part of the goods or services.

2. Paragraph 2 shall apply to earlier national trademarks

. . . by substituting use in the Member State in which the

earlier national trademark is protected for use in the

[Union].

Article 64(2) of the 2017 EUTM Regulation

1. If the proprietor of the EU trade mark so requests, the

proprietor of an earlier EU trade mark, being a party to

the invalidity proceedings, shall furnish proof that,

during the period of five years preceding the date of the

application for a declaration of invalidity, the earlier EU

trade mark has been put to genuine use in the Union in

connection with the goods or services in respect of which

it is registered and which the proprietor of that earlier

trade mark cites as justification for his application, or

that there are proper reasons for non-use, provided that

the earlier EU trade mark has at that date been

registered for not less than five years. If, at the date on

which the EU trade mark application was filed or at the

priority date of the EU trade mark application, the

earlier EU trade mark had been registered for not less

than five years, the proprietor of the earlier EU trade

mark shall furnish proof that, in addition, the conditions

set out in Article 47(2) were satisfied at that date. In the

absence of proof to this effect, the application for a

declaration of invalidity shall be rejected. If the earlier

EU trade mark has been used only in relation to part of

the goods or services for which it is registered, it shall, for

the purpose of the examination of the application for a

declaration of invalidity, be deemed to be registered in

respect of that part of the goods or services only.

Article 57 of the 2017 EUTM Regulation

1. If the applicant so requests, the proprietor of an earlier

EU trade mark who has given notice of opposition shall

furnish proof that, during the period of five years

preceding the date of publication of the EU trademark

application, the earlier EU trade mark has been put to

genuine use in the Union in connection with the goods or

services in respect of which it is registered and which he

cites as justification for his opposition, or that there are

proper reasons for non-use, provided the earlier EU trade

mark has at the date been registered for not less than five

years. In the absence of proof to this effect, the opposition

Vol. 110 TMR 559

shall be rejected. If the earlier EU trade mark has been

used in relation to part only of the goods or services for

which it is registered it shall, for the purposes of the

examination of the opposition, be deemed to be registered

in respect only of that part of the goods or services.

2. Paragraph 2 shall apply to earlier national trade marks

. . . by substituting use in the Member State in which the

earlier national trade mark is protected for use in the

[Union].

Article 58 of the 2017 EUTM Regulation

1. The rights of the proprietor of the EU trade mark shall

be declared to be revoked on application to the [EUIPO]

or on the basis of a counterclaim in infringement

proceedings:

(a) if, within a continuous period of five years, the trade

mark has not been put to genuine use in the Union in

connection with the goods or services in respect of

which it is registered, and there are no proper reasons

for non-use; however, no person may claim that the

proprietor’s rights in an EU trade mark should be

revoked where, during the interval between expiry of

the five-year period and filing of the application or

counterclaim, genuine use of the trade mark has been

started or resumed; the commencement or

resumption of use within a period of three months

preceding the filing of the application or counterclaim

which began at the earliest on expiry of the

continuous period of five years of non-use shall,

however, be disregarded where preparations for the

commencement or resumption occur only after the

proprietor becomes aware that the application or

counterclaim may be filed.

Article 127(3) of the 2017 EUTM Regulation

1. In the actions referred to in points (a) and (c) of Article

124,

118

a plea relating to revocation of the EU trade mark

submitted otherwise than by way of a counterclaim shall

be admissible where the defendant claims that the EU

trade mark could be revoked for lack of genuine use at

the time the infringement action was brought.

118

Namely, infringement actions and actions for compensation in respect of post-

publication, pre-registration acts.

560 Vol. 110 TMR

Article 10 of the 2008 TM Directive

Use of trade marks

1. If, within a period of five years following the date of the

completion of the registration procedure, the proprietor

has not put the trade mark to genuine use in the Member

State in connection with the goods or services in respect

of which it is registered, or if such use has been

suspended during an uninterrupted period of five years,

the trade mark shall be subject to the sanctions provided

for in this Directive, unless there are proper reasons for

non-use.

The following shall also constitute use within the

meaning of the first subparagraph:

(a) use of the trade mark in a form differing in elements

which do not alter the distinctive character of the

mark in the form in which it was registered;

(b) affixing of the trade mark to goods or to the packaging

thereof in the Member State concerned solely for

export purposes.

2. Use of the trade mark with the consent of the proprietor

or by any person who has authority to use a collective

mark or a guarantee or certification mark shall be

deemed to constitute use by the proprietor.

(Note: paragraph 3 was omitted.)

Article 11 of the 2008 TM Directive

Sanctions for non-use of a trade mark in

legal or administrative proceedings

1. A trade mark may not be declared invalid on the ground

that there is an earlier conflicting trade mark if the latter

does not fulfil the requirements of use set out in Article

10(1) and (2), or in Article 10(3), as the case may be.

2. Any Member State may provide that registration of a

trade mark may not be refused on the ground that there

is an earlier conflicting trade mark if the latter does not

fulfil the requirements of use set out in Article 10(1) and

(2) or in Article 10(3), as the case may be.

3. Without prejudice to the application of Article 12, where

a counterclaim for revocation is made, any Member State

may provide that a trade mark may not be successfully

invoked in infringement proceedings if it is established

as a result of a plea that the trade mark could be revoked

pursuant to Article 12(1).

Vol. 110 TMR 561

4. If the earlier trade mark has been used in relation to part

only of the goods or services for which it is registered, it

shall, for purposes of applying paragraphs 1, 2 and 3, be

deemed to be registered in respect only of that part of the

goods or services.

Article 12 of the 2008 TM Directive

Grounds for revocation

1. A trade mark shall be liable to revocation if, within a

continuous period of five years, it has not been put to

genuine use in the Member State in connection with the

goods or services in respect of which it is registered, and

there are no proper reasons for non-use.

However, no person may claim that the proprietor’s

rights in a trade mark should be revoked where, during

the interval between expiry of the five-year period and

filing of the application for revocation, genuine use of the

trade mark has been started or resumed.

The commencement or resumption of use within a period

of three months preceding the filing of the application for

revocation which began at the earliest on expiry of the

continuous period of five years of non-use shall be

disregarded where preparations for the commencement

or resumption occur only after the proprietor becomes

aware that the application for revocation may be filed.

. . .

Article 14 of the 2008 TM Directive

Establishment a posteriori of invalidity or

revocation of a trade mark

Where the seniority of an earlier trade mark which has been

surrendered or allowed to lapse is claimed for a Community

trade mark, the invalidity or revocation of the earlier trade

mark may be established a posteriori.

Article 39 of the 2017 EUTM Regulation

Claiming seniority of a national trade mark in an

application for an EU trade mark or subsequent

to the filing of the application

1. The proprietor of an earlier trade mark registered in a

Member State, including a trade mark registered in the

Benelux countries, or registered under international

arrangements having effect in a Member State, who

562 Vol. 110 TMR

applies for an identical trade mark for registration as an

EU trade mark for goods or services which are identical

with or contained within those for which the earlier trade

mark has been registered, may claim for the EU trade

mark the seniority of the earlier trade mark in respect of

the Member State in or for which it is registered.

(Note: paragraph 2 was omitted.)

3. Seniority shall have the sole effect under this Regulation

that, where the proprietor of the EU trade mark

surrenders the earlier trade mark or allows it to lapse, he

shall be deemed to continue to have the same rights as he

would have had if the earlier trade mark had continued

to be registered.

4. The seniority claimed for the EU trade mark shall lapse

where the earlier trade mark the seniority of which is

claimed is declared to be invalid or revoked. Where the

earlier trade mark is revoked, the seniority shall lapse

provided that the revocation takes effect prior to the

filing date or priority date of that EU trade mark.

C. Cases

1. EU—CJEU—Does “genuine use” of a trademark

include use on the packaging of food products

to describe the main ingredient of such goods?

The CJEU in Pandalis v. EUIPO

119

considered the question of

whether a registered word mark had been used as a trademark (in

accordance with the essential function to distinguish origin) or

merely as a description of the ingredients in the relevant goods.

On January 5, 2004, the word mark CYSTUS was registered by

Mr. Pandalis as an EU trademark under class 30 for “food

supplements not for medical purposes.” The mark was revoked ten

years later after LR Health & Beauty Systems filed an application

for revocation under Article 51(1)(a) of the 2009 EUTM

Regulation,

120

on the basis that the mark had not been put to

genuine use within a continuous period of five years.

Mr. Pandalis’s appeal was dismissed by the First Board of

Appeal of the EUIPO (Board of Appeal) on three grounds:

(a) the term “cystus” was not used as an EU trademark to

indicate the commercial origin of his goods but to describe

the ingredients that contained extracts from the plant

variety Cistus Incanus L;

119

Case C-194/17P (CJEU, January 31, 2019) (EU:C:2019:80).

120

This provision is now found at Article 58(1)(a) of the 2017 EUTM Regulation.

Vol. 110 TMR 563

(b) partial use of the symbol “®” and the different spelling of

the mark with a y were not sufficient to conclude that the

mark was used in its essential function as an EU

trademark; and

The General Court agreed with the Board of Appeal’s decision.

In particular, the General Court reiterated that the public would

consider use of the term “cystus” on the packaging of non-medical

food supplements to be descriptive of the main ingredient of those

goods, rather than to identify the commercial origin of such goods.

By way of example, the Court held that the terms “extract of

cystus®” and “cystus® 052” in the product ingredient list for the

product Immun44® Saft did not designate the commercial origin of

a non-medical food supplement.

The General Court noted that such “misspellings” generally do

not make a sign distinctive if its content can immediately be

understood as descriptive, especially where the letters i and y are

often used interchangeably in words of Latin origin. The General

Court also ruled that the Board of Appeal was right to hold that

certain of the products that Mr. Pandalis argued did amount to use

of the mark, used with respect to “lozenges, throat pastilles, stock,

gargling solution and infection blocker tablets,” were not, in fact,

“food supplements not for medical purposes” so would not amount

to use falling within the specification of the mark in any event.

The General Court therefore concluded that the mark had not

been put to genuine use within the meaning of Article 51(1)(a), but

it (and the Board of Appeal) did not find that the mark was

descriptive in nature under Article 7(1)(c).

121

Mr. Pandalis

subsequently appealed to the CJEU.

Before the CJEU’s ruling on January 31, 2019, Advocate

General Kokott (AG) delivered her opinion in September 2018 and

recommended that the CJEU dismiss the appeal. In relation to the

assessment of genuine use, the AG noted that the weak distinctive

character of the mark meant that the trademark may, in principle,

be used either as an indication of commercial origin of a product or

as a description of its ingredients. The AG further explained use

would be regarded as “genuine” only where it is used as an

indication of commercial origin to allow a customer to be able to

choose (or avoid) buying the product again. Thus, not all use of a

trademark must be in its function of indicating origin but also of

guaranteeing quality or advertising; therefore not all manners of

commercial exploitation would automatically be deemed genuine

use of the mark under Article 51(1)(a).

The CJEU ruled that a significant portion of Mr. Pandalis’s

appeal was merely challenging the factual assessment made by the

121

This provision is now found at Article 7(1)(c) of the 2017 EUTM Regulation.

564 Vol. 110 TMR

General Court in reaching its conclusion, having not claimed that

the General Court had distorted either the facts or the evidence.

Consequently, the CJEU dismissed the complaint as to the Board of

Appeal’s error in identifying “food supplements not for medical

purposes.”

In relation to the ground of appeal relating to the General

Court’s assessment of genuine use, the CJEU agreed with the

assessment of the General Court, confirming that there had been no

error of law in its ruling. The CJEU reiterated previous case law,

determining that genuine use must be assessed having regard to all

facts and circumstances to establish whether commercial genuine

use of the mark has occurred, which does not include token use for

the sole purpose of preserving the rights provided by the mark. The

CJEU agreed with the AG’s opinion that genuine use is based on an

indication of commercial origin and therefore held that the General

Court was correct in finding that Mr. Pandalis had not made use of

the mark under its essential function, but only as a description of

the main ingredient of the goods concerned. The CJEU also

concluded that the Board of Appeal had not ruled that the mark was

descriptive in nature under Article 7(1)(c) and that the General

Court had not erred in its assessment of that decision.

2. EU—CJEU—What is the relevance of

“dotted” and solid lines when assessing

genuine use of such marks?

The CJEU in Deichmann v. EUIPO

122

considered whether the

EU trademark registered by the intervener (below) on March 24,

2004, for “sports footwear’ should be classified as a position mark or

a figurative mark. During infringement proceedings brought

against Deichmann SE (Deichmann), Deichmann filed a

counterclaim under, inter alia, Article 51(1)(a) of the 2009 EUTM

Regulation

123

alleging failure by the proprietor to put the mark to

genuine use for a continuous period of five years. Upon a stay of the

proceedings by the Landgericht Düsseldorf (Regional Court,

Düsseldorf), Deichmann filed an application for revocation of the

mark based on the same ground of non-use.

122

Case C-223/18 P (CJEU, June 6, 2019) (EU:C:2019:471).

123

This is now Article 58(1)(a) of the 2017 EUTM Regulation.

Vol. 110 TMR 565

The Cancellation Division’s original decision to revoke the mark

was annulled by Munich SL’s appeal to the Fourth Board of Appeal

of EUIPO. On further appeal by Deichmann, the General Court

agreed with the Board of Appeal’s decision, finding that the evidence

of use filed by the proprietor had demonstrated genuine use of the

mark for the relevant goods during the five-year period preceding

the date of filing the counterclaim.

The General Court also ruled that, when assessing the

distinctiveness of a mark, the classification of a position mark as a

figurative or three-dimensional mark was irrelevant. In any case,

case law

124

recognizes that figurative marks may, in fact, be position

marks. The mere fact that the “figurative mark” box was ticked

when the mark at issue was registered was not conclusive. Instead,

consideration should be given to the graphical representation of the

mark at issue clearly identifying:

(a) in solid lines, the element in respect of which protection was

applied for; and

(b) in dotted lines, the outline of the goods at issue on which

that element was placed.

The General Court therefore inferred from the graphical

representation of the mark that the protection sought covered only

a cross, consisting of two black intersecting solid lines. In contrast,

the “dotted” lines should be understood as forming the outline of the

product to which the position of that cross is specified, on the basis

that “dotted” lines are usually used in this manner in graphical

representations.

Deichmann sought an appeal to the CJEU, alleging improper

application of Articles 15(1)

125

and 51(1)(a) of the 2009 EUTM

Regulation in relation to the issue of non-use. In particular,

Deichmann set out three arguments for its ground of appeal,

whereby the General Court had:

(a) failed to consider the importance of classifying the mark at

issue as a position or figurative mark by concluding that it

is irrelevant for assessing whether the mark had been put

to genuine use;

(b) contradicted itself by maintaining that the determination of

the subject matter of the mark at issue was irrelevant and

by treating it as a position mark anyway when assessing

genuine use; and

genuine use as a result of its assessment of the mark at

124

Colloseum Holding, Case C-12/12 (CJEU, April 18, 2013) (EU:C:2013:253) and

Rosenruist v. OHIM (Representation of two curves on a pocket), Case T-388/09 (GC,

September 28, 2010) (EU:T:2010:410).

125

This is now Article 18(1) of the 2017 EUTM Regulation.

566 Vol. 110 TMR

issue as a position mark, when it is incorrect to regard the

mark as a position mark.

In delivering its judgment, the CJEU first confirmed that the

classification of the mark as a position or figurative mark is indeed

irrelevant for the purposes of assessing genuine use of a mark. In

its ruling in Société des produits Nestlé v. Mondelez UK Holdings &

Services,

126

it is stated that the requirements for assessing genuine

use of a mark within the meaning of Article 15(1) of the 2009 EUTM

Regulation are comparable to the requirements for assessing

acquired distinctiveness of a mark through use for the purpose of its

registration under Article 7(3) of the 2009 EUTM Regulation.

127

These requirements do not include determining the subject matter

of the mark at issue.

In respect of the subject matter of the mark at issue, the CJEU

agreed with the General Court’s approach that, although the subject

matter of the mark at issue is defined by the graphical

representation as registered, the General Court is entitled to

consider the likely interpretation of the solid and “dotted” lines in

the graphical representation. The factual assessment carried out by

the General Court could not be challenged in any event, but the

Court had been entitled to infer from the graphical representation

that the protection sought covered only a cross, consisting of two

black intersecting lines, represented in solid lines.

The CJEU referred to its judgment in Pi-Design and Others v.

Yoshida Metal Industry,

128

in clarifying that the assessment of

characteristics of a sign may consider (in addition to the graphical

representation and any descriptions filed at the time of the

application to register) any other material relevant to identifying

the essential characteristics of a sign. It is the function of the

graphical representation to define the mark itself in order to

determine the precise subject of the protection afforded by the

registered mark. In any case, neither the applicable legislation or

case law requires filing a description or disclaimer to specify the

scope of protection sought by a trademark, nor are the EUIPO

Guidelines legally binding in requiring that a position mark be

expressed as such.

Finally, the CJEU ruled that the General Court did not err in

law by finding that the differences between the mark at issue and

the versions used on the sports shoes marketed by Munich SL were

negligible. The evidence of use of the mark on the shoes was

therefore sufficient to establish genuine use of the mark.

126

Case C-84/17 P, C-85/17 P and C-95/17 P (CJEU, July 25, 2018) (EU:C:2018:596), at

para. 70.

127

This is now Article 7(3) of the 2017 EUTM Regulation.

128

Case C-337/12 (CJEU, March 6, 2014) (EU:C:2014:129), at para 54.

Vol. 110 TMR 567

3. EU—CJEU—Does a sign have

distinctive character if there is a possibility

for it to be used as an indication of origin,

even if it is not the most likely use?

AS v. Deutsches Patent- und Markenamt

129

concerned a request

from the German Federal Court of Justice (the Bundesgerichtshof)

to the CJEU for a preliminary ruling in relation to the application

to register as a German national trademark a sign comprising the

hashtag “#darferdas?” (loosely translated as “Can he do that?”) in

class 25 for “clothing, in particular tee-shirts; footwear; headgear.”

The German Patent and Trade Mark Office (the “DPMA”) had

rejected the application on the grounds that it was devoid of

distinctive character.

AS had appealed to the Federal Patents Court

(Bundespatentgericht), which also dismissed the action, stating that

the sign simply represented a stylized version of three common

German words. The Federal Patent Court held that the relevant

public, on seeing the sign on the front of an item of clothing, would

not understand it as an indication of origin but rather as a simple

question relating to everyday language.

AS appealed further to the Federal Court of Justice

(Bundesgerichthof), which found it common practice in the clothing

industry to place marks on both exterior and interior labels (i.e.,

tags on the outside of the clothing and sewn inside the garment).

The request for a preliminary ruling related to the proper

interpretation of Article 3(1)(b) of Directive 2008/95/EC relating to

the distinctive character of trademarks. The Federal Court of

Justice, in referring the following question to the CJEU, noted that

the examiner would need to determine whether a consumer, on

seeing the types of placement (or at least one label on the garment)

would believe the sign to be a trademark: “Does a sign have

distinctive character when there are in practice significant and

plausible possibilities for it to be used as an indication of origin in

respect of goods or services, even if it is not the most plausible use

of the sign?”

In considering the terms of the reference, the CJEU first

considered the question of whether a hashtag could be registered as

a trademark. There was no reason in principle to assume at the

outset that a hashtag could not, in theory, indicate the commercial

origin of goods and services and therefore be registrable as a

trademark. The proper assessment to be carried out by the

administrative/judicial authority was whether the mark for which

registration was sought had the necessary distinctive character

129

Case C-541/18 (2019).

568 Vol. 110 TMR

within the meaning of Article 3 of Directive 2008/95—either

intrinsically

130

—or acquired through use as a trademark.

131

The CJEU reiterated the well-established test that the

assessment of distinctive character must be carried out by reference

to the perception of the average consumer of the goods and services,

who is reasonably well informed and circumspect, taking into

account all the circumstances.

132

Specifically, the CJEU observed

that there was no requirement for an applicant to indicate the use

it will or intends to make of the mark applied for, or even to know

precisely what such use might be. Indeed, even following

registration of the mark, the applicant has a period of five years to

commence the actual use, provided such use is consistent with the

essential function of a trademark.

133

In cases where there had been no use (or at least no significant

use) of the mark prior to registration, the examiner must identify

use in light of the customs and behaviors of the sector (here of the

manufacturers/retailers of such garments) and the associated

perception of consumers within the relevant Member State in

question. Where the relevant custom and practice demonstrated the

potential for several uses of a mark, the examiner would need to

consider all of these to determine whether the average consumer

would perceive the mark as an indication of commercial origin and,

therefore, whether the sign had distinctive character.

In the present case, the referring court had identified two types

of placement that are practically significant in that clothing sector,

being the front of a tee-shirt and/or the label placed on the inside of

it. On that basis, it was for the national court to determine whether

consumers would perceive “#darferdas” as an indicator of

commercial origin (rather than simply a decorative element) where

it has been placed either on the front of a tee-shirt and/or sewn in

as a label. The relevant assessment could only focus on one potential

use where that was the only “practically significant” custom in the

economic sector concerned, which was not the case here.

130

Article 3(1)(b).

131

Oberbank and Others, Case C-217/13 and C2-218/13 (EU:C;2014:2012).

132

Koninklijke KPN Nederland, Case C-363/99 (EU:C:2004:86).

133

Silberquelle, Case C-495/07, EU:C:2009:10.

Vol. 110 TMR 569

4. EU—General Court—Is it necessary

to evidence use throughout the territory

of the EU, and not only in a substantial part

or the majority of the territory, in order to prove

distinctive character acquired by use?

Gibson Brands Inc. v. EUIPO and Hans-Peter Wilfer

134

concerned the General Court’s assessment of validity of the

registration of a three-dimensional mark of a guitar with a V-shaped

body (also known as the “Flying V”) by the well-known guitar

manufacturer Gibson. The mark is reproduced below:

The mark was successfully registered by Gibson in classes 9, 15,

and 25 under No. 9179953 on November 30, 2010.

On October 7, 2014, the intervener, Mr. Hans-Peter Wilfer

(owner of Warwick GmbH & Co., a Germany guitar manufacturer)

filed an application under Article 59(1)(a) of the 2009 EUTM

Regulation challenging validity on the basis of Article 7(1)(b)

(distinctive character), (d) (signs or indications that have become

customary), and (e) (signs that consist exclusively of a shape that

results from the nature of the goods themselves, a shape of goods

necessary to obtain a technical result, or a shape that gives

substantial value to the goods). The relief sought was a declaration

of partial invalidity of the challenged mark insofar as it had been

registered for musical instruments in class 15.

By a decision of December 21, 2016, the Cancellation Division of

EUIPO upheld Mr. Wilfer’s application, finding that the challenged

mark was devoid of inherent distinctive character for the goods at

issue within the meaning of Article 7(1)(b) of the 2009 EUTM

Regulation and that, furthermore, the applicant had failed to

establish the distinctive character acquired by that mark in the EU

134

Case T-340/18 (CJEU, June 28, 2019) (EU:T:2019:455).

570 Vol. 110 TMR

within the meaning of Article 59(2) of the 2009 EUTM Regulation.

Gibson appealed against the decision of the Cancellation Division.

The Second Board of Appeal dismissed the appeal.

135

The Board

of Appeal held that, even if electric guitars with V-shaped bodies

may have been very unusual when they were released in 1958, that

shape is now perceived as one possible variant of the many shapes

of electric guitars on the market. As such, the shape no longer

departed significantly from the norms and customs of the electric

guitar sector at the time the challenged mark had been filed.

Consequently, consumers could not base their decision to purchase

solely on the V-shape as an indication of origin, since that shape was

devoid of inherent distinctive character. As to distinctive character

acquired by use, the Board of Appeal considered that the eight

market surveys produced by Gibson were not sufficient for the

extrapolation of their results to the rest of the EU.

Gibson appealed to the EU General Court. Relying on

Article 59(1)(a) and Article 7(1)(b) of the 2009 EUTM Regulation,

Gibson argued that the Board of Appeal had failed to properly apply

the standard for assessing the inherent distinctiveness of the

challenged mark, resulting in a wrongful discharge of the burden of

proof.

Relying on Article 59(2) and Article 7(3) of the 2009 EUTM

Regulation, Gibson contended that the Board of Appeal wrongly

held that the challenged mark had become iconic independent of the

applicant and that its reputation precluded the acquisition of

distinctive character through use. It also argued that the proper

standard for assessing the challenged mark’s acquired

distinctiveness was not taken into account and finally, that the

decision lacked proper reasoning of distinctiveness acquired

through use, particularly in relation to the market surveys not being

taken into account and the existence of a dealer network in Cyprus

and Slovenia not being sufficient to establish use in those two

Member States.

The General Court confirmed the Board of Appeal’s decision in

all respects. The presence on the market of a significant number of

shapes encountered by consumers made it unlikely that they would

regard a particular shape as belonging to a specific manufacturer,

rather than being just one of the variety of shapes characterizing

the market. Owing to the presence of at least a dozen shapes of

guitar bodies on the market, from the traditional rounded shape to

angular V or X shapes, or shapes that imitate an axe, the “Flying V”

guitar was only one possible variant of many existing shapes that

did not depart significantly from the norms and customs of the

sector.

135

Case R 415/2017-2.

Vol. 110 TMR 571

The General Court found that the Board of Appeal had correctly

considered as evidence North American publications, because those

publications enabled the perception of the challenged mark by the

relevant public in the EU. The market of musical instruments must

properly be regarded as a global market.

The General Court also confirmed that the eight market surveys

produced by Gibson (initially considering perception by consumers

in Germany, Italy, Sweden, and later supplemented by Bulgaria,

Spain, the Netherlands, Poland, and the UK) were insufficient to

prove that the challenged mark had acquired a distinctive character

throughout the EU. As established in KIT KAT,

136

where a mark is

not inherently distinctive, the distinctive character acquired

through use must be shown throughout the territory of the EU and

not only in a substantial part or the majority of the territory.

137

The

Board of Appeal also confirmed the Board of Appeal’s reasoning

regarding Cyprus and Slovenia and since the applicant had not

previously demonstrated use of the challenged mark in those

territories, an extrapolation of the global data concerning the EU

market as a whole could not be made without more specific evidence

of sales in those territories. The presence of an authorized dealer in

such territories was insufficient without evidence of (substantial)

sales.

5. Poland—Polish Supreme Administrative Court

(SAC)—What evidence is necessary to establish

genuine use of a trademark and what is the relevant

time frame for such evidence?

The judgment of the Polish Supreme Administrative Court

(“SAC”) in II GSK

138

concerns a non-use claim relating to the Polish

national trademark for the word “GRASOVKA.” The party filing the

non-use claim, a German company (Semper Idem Underberg GmbH

or “Semper”) indicated that it was entitled to the EUTM for the word

“GRASOVKA” and intended to enter the Polish market in the near

future. In its opinion, the owner of the Polish trademark

GRASOVKA (a Polish company, CEDC International Sp. z o.o.,

“CEDC”) had not used this mark for a continuous period of five years

in the territory of Poland. The proprietor of the Polish trademark

contended that the disputed mark was genuinely used for goods in

class 33 (vodka).

In its decision at first instance the Polish Patent Office (“PPO”)

revoked the trademark GRASOVKA for non-use. The PPO ruled

136

Société des produits Nestlé SA and Others v. Mondelez UK Holdings & Services, Cases

C-84/17 P, C-85/17 P and C-95/17 P (EU:C:2018:596) para. 87.

137

Société des produits Nestlé SA and Others v. Mondelez UK Holdings & Services, Cases

C-84/17 P, C-85/17 P, and C-95/17 P (EU:C:2018:596) para. 87.

138

Judgment of the SAC of 10.07.2019, II GSK 2051/17, LEX no. 2713879.

572 Vol. 110 TMR

that the relevant time for examination of genuine use was the five-

year period from November 2008 to November 2013 (being the five-

year period preceding the application for revocation). The evidence

submitted by the proprietor and taken into account by the PPO

showed that during the relevant period the proprietor had placed

only 4032 bottles of vodka labeled with the disputed mark on the

market. Evidence dated prior (or subsequent) to the relevant period

for demonstrating use, or subsequent to the revocation filing, was

considered irrelevant, as were materials that were not dated at all.

In the PPO’s opinion, a mark registered for spirits in class 33 did

not indicate a particularly “niche” market (for which a lower

quantity of use might still be considered enough), so the extent of

use was found to be insufficient. On first appeal, the District

Administrative Court (“DAC”) in Warsaw upheld the decision of the

PPO, confirming the findings of the Office that there was no genuine

use during the relevant time.

The case reached the SAC, which reversed the findings below.

In the opinion of the SAC,

139

the PPO incorrectly assumed that the

genuine use of a trademark consists solely of the act of placing goods

on the market. According to the relevant provisions and case law,

placing goods on the market is one but not the only form of genuine

use of a trademark. The SAC referred to the CJEU guidance in La

Mer,

140

according to which genuine use of a trademark is established

where a mark is used in accordance with its essential function,

which is to guarantee the identity of the origin of the goods or

services for which it is registered, in order to create or preserve an

outlet for those goods or services.

In the proper analysis, in the opinion of the SAC, the assessment

of the Office should have taken into account the entirety of the

evidence gathered and there were no grounds to automatically

exclude the evidential value of documents that were not issued

during the period under investigation. The Office should be

consistent in its reasoning and take into account all evidence upon

which conclusions could safely be drawn on the genuine use as of

the date of filing the revocation application, as well as the

continuation of actions subsequent to that date.

141

The Court agreed with the appellant that the approach of the

authority was arbitrary when it assumed that classification of goods

in class 33 was of itself a determination of the mass market nature

of those goods. The approach of the PPO and the DAC had been

139

Judgment of the SAC of 10.07.2019, II GSK 2051/17, LEX no. 2713879.

140

Judgment of the CJEU of 27.01.2004, Case C-259/02 (La Mer Technology), pt. 31-33,

ECLI:EU:C:2004:50.

141

Judgment of the CJEU of 5.10.2004, Case C-192/03 (Alcon v. OHIM), pt. 41,

ECLI:EU:C:2004:587; Judgment of the CJEU of 27.01.2004, Case C-259/02 (La Mer

Technology), pt. 27, ECLI:EU:C:2004:50.

Vol. 110 TMR 573

incorrect because both authorities assumed that belonging to a

particular class of goods determines automatically their mass or

niche character. It was also irrelevant that the proprietor of the

Polish trademark did not conduct advertising campaigns to link the

trademark with certain goods in the minds of consumers, not least

as there is a legal prohibition on advertising and promotion of

alcoholic beverages (which includes goods in class 33

142

The SAC confirmed that placing goods on the market is only one

among the various forms of genuine use of a trademark. In

accordance with EU case law, the SAC assessed the genuine use in

the context of achieving the purpose and function of a trademark

and not by undertaking predetermined actions, as these may take

various forms depending on the chosen market strategy of any

trader. The SAC considered that when it serves a real commercial

purpose, even minimal use of the mark, or use by only a single

importer in the member state, could be sufficient to establish

genuine use.

As to the assessment of the relevant evidence confirming

genuine use, the approach of the SAC was rather more

controversial, although arguably still consistent with several CJEU

judgments. The SAC confirmed that while assessing genuine use

during the relevant period, any circumstances prior to or

subsequent to the filing of a non-use claim should be taken into

account, as long as they enable the tribunal to draw conclusions on

the facts as they existed during the relevant period. In this

particular situation the scope of evidence should not be restricted by

automatically rejecting documents submitted which were issued

outside of the period under examination.

6. Spain—Commercial Court of Barcelona—

Revocation of a historic but well-known mark

This case represents the Spanish installment of two companies

(one from the United States and one from Japan) involved in an

international dispute over the historic brand “AIWA.”

The company Aiwa Co. Ltd. was founded in 1959 in Japan and

was once a well-regarded global brand, known for making quality

audio products and being the market leader in several product

categories. It created the first cassette tape recorder in the Japanese

market in 1964.

The company eventually became unprofitable and was

purchased by Sony in 2003. AIWA was then rebranded as a new

“youth-focused” division of Sony. This strategy ultimately proved

unsuccessful, and in 2006 Sony announced that it had discontinued

use of the AIWA brand.

142

Article 13 of the Act on Education in Sobriety and Counteracting Alcoholism of

26.10.1982, Journal of Laws 2018 No. 2137.

574 Vol. 110 TMR

In 2015, an American audio company known as Hale Devices,

Inc. registered a number of trademarks for AIWA, both in the

United States and in the EU. The company renamed itself “AIWA

Corporation” and started to produce and sell AIWA-branded audio

equipment in 2015.

In February 2017, SONY sold its AIWA trademarks to one of its

suppliers, Towada Audio Co. In April 2017, Towada changed its

company name to “AIWA Co. Ltd.” and designed a plan to relaunch

the AIWA brand internationally.

When AIWA Corporation became aware of this plan in 2017, it

filed a series of revocation actions in various territories to cancel the

trademark rights formerly owned by SONY on the grounds of non-

use. Spain is the first jurisdiction where these revocation

proceedings have reached a final decision.

The Japanese defendant sought to argue that the application for

revocation was made in bad faith as the plaintiff had

misappropriated a third party’s trademark. It also claimed that the

trademark remained in genuine use, including through the sales on

e-Bay and other online platforms where old stock, refurbished or

second-hand products remained available for purchase. Further, the

trademark also remained in use with third-party companies that

still offered repair services and sold spare parts of AIWA products.

In addition, the defendant had begun commercial preparations to

recommence use and had signed license agreements with many local

companies in different jurisdictions to “revive” and relaunch the

brand.

In its judgment of April 10, 2019,

143

the Commercial Court of

Barcelona upheld the complaint of the U.S. company and cancelled

the Spanish AIWA trademarks for non-use.

The Commercial Court did not consider that the American

plaintiff was acting in bad faith. It was the owner of a U.S. and an

EU Trademark Registration, that had not been challenged by the

defendant, so it had a legitimate interest to remove the old

trademarks from the Registry to be able to use its own trademarks

without risk. The fact that similar cancellation actions had been

launched in other jurisdiction strengthened the legitimate interest

of the trademark owner to become the sole owner of exclusive rights

on trademark AIWA and gain market share for the trademark.

In confirming a lack of genuine use, the Court considered that

no new products had been manufactured or sold in Spain in the

previous five years. The printouts from eBay, Amazon, and others

showing that AIWA products were still being sold was not sufficient,

as these websites only showed the sale of secondhand products by

individual owners. In addition, the sale of old stocks could only be

143

Aiwa Corporation v. Aiwa Co. Ltd., Judgment 164/2019 dated April 10, 2019, of

Commercial Court of Barcelona No. 9 (Case 789/2017).

Vol. 110 TMR 575

regarded as “symbolic” without any intervention from the

trademark owner and without an aim to create or maintain a

market share for the brand. In fact, some of the new AIWA products

brought forward by the defendant were in fact AIWA products of the

plaintiff, AIWA Corporation.

A Private Investigator appointed by the plaintiff helped prove

that there were no AIWA products sold in Spain. He had made

telephone enquiries to Sony, visited a large number of retailers of

electronic goods in Spain, and made Internet searches, and all these

enquiries clearly showed no genuine use of the trademark AIWA in

the preceding five years.

In relation to the repair services and the fact that spare parts of

AIWA products could still be found, the Court considered that this

was also irrelevant. Applying the findings of the CJEU in

Ansul/Minimax

144

the Court considered that these repair services

were not only of AIWA goods but of dozens of other marks. Apart

from that, these companies were completely unrelated to the

trademark owner. The Court said that if these repair service

companies had indeed acted as an official service of the AIWA

brand, it would have been very easy to submit invoices proving this

fact, which the defendant never did.

Finally, considering the preparations for use, the Court

considered that these took place after the defendant had become

aware that the cancellation action could be filed. For example, the

license agreement with a Spanish dealer filed as evidence in the

proceedings was dated February 21, 2018, a few months after the

Spanish complaint had been filed.

Consequently, all the three Spanish Trademark Registrations

(formerly in the name of SONY that now belonged to the recently

created company AIWA Company Ltd.) were cancelled for non-use.

The judgment was not appealed and is final. The dispute continues

in many other jurisdictions, including in the EUIPO.

VI. TRADEMARK INFRINGEMENT

A. Introductory Comments

This Part VI considers cases on infringement of the exclusive

rights conferred on trademark proprietors by the EUTM Regulation

and the TM Directive.

The exclusive use rights of a trademark proprietor relating to

EU trademarks are found in Article 9 of the 2017 EUTM Regulation.

The parallel rights conferred by a trademark in relation to the

national trademark authorities of EU Member States are set out in

144

Case C-40/01 (ANSUL/MINIMAX), March 13, 2003.

576 Vol. 110 TMR

Article 5 of the 2008 TM Directive (now Article 10 of the 2015 TM

Directive).

The cases featured in this Part VI are all from the EU national

courts covering a typically diverse range of issues. The UK High

Court considered an infringement action on an expedited basis in a

highly compressed timetable, while the Dutch Supreme Court

considered liability for refilling branded receptacles with third-

party product. The Lisbon Court of Appeal confirmed that the use of

trademarks in comparative price lists might take unfair advantage

by denoting equivalence (other than on price) and the Court of

Appeal of Luxembourg confirmed the narrow scope of protection for

a mark with weak distinctive character. A fascinating case in

Belgium related to the balancing of freedom or artistic impression

with the rights of a trademark proprietor to prevent exploitation of

such marks. Perhaps reflecting the growing importance of the

“online” environment, a considerable number of cases in 2019

explored liability for infringement in that environment, including in

relation to search functions, autocomplete, Internet keywords and

clickthrough revenue, as well as determining whether brand owners

or Internet Service Providers must bear the cost of preventing

access by consumers to online sources of counterfeit goods.

B. Legal Texts

Article 9 of the 2017 EUTM Regulation

1. An EU trade mark shall confer on the proprietor

exclusive rights therein.

2. Without prejudice to the rights of proprietors acquired

before the filing date or the priority date of the EU trade

mark, the proprietor of that EU trade mark shall be

entitled to prevent all third parties not having his

consent from using in the course of trade, in relation to

goods or services, any sign where:

(a) the sign is identical with the EU trade mark and is

used in relation to goods or services which are

identical with those for which the EU trade mark is

registered;

(b) the sign is identical with, or similar to, the EU trade

mark and is used in relation to goods or services

which are identical with, or similar to the goods or

services for which the EU trade mark is registered, if

there exists a likelihood of confusion on the part of the

public; the likelihood of confusion includes the

likelihood of association between the sign and the

trade mark;

Vol. 110 TMR 577

mark irrespective of whether it is used in relation to

goods or services which are identical with, similar to,

or not similar to those for which the EU trade mark

is registered, where the latter has a reputation in the

Union and where use of that sign without due cause

takes unfair advantage of, or is detrimental to, the

distinctive character or the repute of the EU trade

mark.

3. The following, inter alia, may be prohibited under

paragraph 2

(a) affixing the sign to the goods or to the packaging

thereof;

(b) offering the goods, putting them on the market or

stocking them for these purposes under that sign, or

offering or supplying services thereunder;

(d) using the sign as a trade or company name or part of

a trade or company name;

(e) using the sign on business papers and in advertising;

(f) using the sign in comparative advertising in a

manner that is contrary to Directive 2006/114/EC.

4. Without prejudice to the rights of proprietors acquired

before the filing date or the priority date of the EU trade

mark, the proprietor of that EU trade mark shall also be

entitled to prevent all third parties from bringing goods,

in the course of trade, into the Union without being

released for free circulation there, where such goods,

including packaging, come from third countries and bear

without authorization a trademark which is identical

with the EU trade mark registered in respect of such

goods, or which cannot be distinguished in its essential

aspects from that trade mark.

The entitlement of the proprietor of an EU trade mark

pursuant to the first sub-paragraph shall lapse if, during the

proceedings to determine whether the EU trade mark has

been infringed, initiated in accordance with EU Regulation

No. 608/2013, evidence is provided by the declarant or the

holder of the goods that the proprietor of the EU trade mark

is not entitled to prohibit the placing of the goods on the

market in the country of final destination.

(Note: in the 2017 EUTM Regulation, Article 9 has been

extended and supplemented. Article 9(4), dealing with goods

in transit, is a new feature that was not found in the old

EUTM Regulation. Also new are the express references to

578 Vol. 110 TMR

use as a trade or company name in Article 9(3)(d) and to use

in unlawful comparative advertising in 9(f). (Note that this

does not outlaw the use of marks in comparative advertising

per se, but the use must conform to EU law requirements.)

The numbering has also changed, so that the main infringing

acts now fall under Article 9(2) rather than 9(1), as they did

under the old EUTM Regulation. The provision that the

exclusive rights are without prejudice to earlier rights, at the

beginning of Article 9(2), is also new.)

Article 5 of the 2008 TM Directive

(Note: The corresponding provisions are to be found in

Article 10 of the 2015 TM Directive.)

1. The registered trade mark shall confer on the proprietor

exclusive rights therein. The proprietor shall be entitled

to prevent all third parties not having his consent from

using in the course of trade:

(a) any sign which is identical with the trade mark in

relation to goods or services which are identical with

those for which the trade mark is registered;

(b) any sign where, because of its identity with, or

similarity to, the trade mark and the identity or

similarity of the goods or services covered by the trade

mark and the sign, there exists a likelihood of

confusion on the part of the public; the likelihood of

confusion includes the likelihood of association

between the sign and the trade mark.

2. Any Member State may also provide that the proprietor

shall be entitled to prevent all third parties not having

his consent from using in the course of trade any sign

which is identical with, or similar to, the trade mark in

relation to goods or services [which are not similar to

those for which the trade mark is registered], where the

latter has a reputation in the Member States and where

use of that sign without due cause takes unfair

advantage of, or is detrimental to, the distinctive

character or the repute of the trade mark.

3. The following, inter alia, may be prohibited under

paragraphs 1 and 2:

(a) affixing the sign to the goods or to the packaging

thereof;

(b) offering the goods, or putting them on the market or

stocking them for these purposes under that sign, or

offering or supplying services thereunder;

Vol. 110 TMR 579

(d) using the sign on business papers and in advertising.

(Note: By virtue of CJEU case law, the italicized wording

appearing above in square brackets is effectively to be

ignored. In other words, the rule applies whether or not the

goods and services in question are similar, including

situations where the goods and services are identical. The

infringement provisions of the 2008 TM Directive are

modified in the 2015 TM Directive Article 10 of the 2015 TM

Directive, which sets out the relevant provisions,

corresponds closely with the provisions of Article 9 of the

2017 EUTM Regulation.)

Article 97 of the 2009 EUTM Regulation

1. Subject to the provisions of this Regulation as well as to

any provisions of Regulation (EC) No 44/2001 applicable

by virtue of Article 94, proceedings in respect of the

actions and claims referred to in Article 96 shall be

brought in the courts of the Member State in which the

defendant is domiciled or, if he is not domiciled in any of

the Member States, in which he has an establishment.

24.3.2009 EN Official Journal of the European Union L

78/23

2. If the defendant is neither domiciled nor has an

establishment in any of the Member States, such

proceedings shall be brought in the courts of the Member

State in which the plaintiff is domiciled or, if he is not

domiciled in any of the Member States, in which he has

an establishment.

3. If neither the defendant nor the plaintiff is so domiciled

or has such an establishment, such proceedings shall be

brought in the courts of the Member State where the

Office has its seat.

4. Notwithstanding the provisions of paragraphs 1, 2 and 3:

(a) Article 23 of Regulation (EC) No 44/2001 shall apply

if the parties agree that a different Community

trademark court shall have jurisdiction;

(b) Article 24 of Regulation (EC) No 44/2001 shall apply

if the defendant enters an appearance before a

different Community trademark court.

5. Proceedings in respect of the actions and claims referred

to in Article 96, with the exception of actions for a

declaration of non-infringement of a Community trade

mark, may also be brought in the courts of the Member

State in which the act of infringement has been

committed or threatened, or in which an act within the

580 Vol. 110 TMR

meaning of Article 9(3), second sentence, has been

committed.

Article 10 of the 2015 TM Directive

1. The registration of a trade mark shall confer on the

proprietor exclusive rights therein.

2. Without prejudice to the rights of proprietors acquired

before the filing date or the priority date of the registered

trade mark, the proprietor of that registered trade mark

shall be entitled to prevent all third parties not having

his consent from using in the course of trade, in relation

to goods or services, any sign where:

(a) the sign is identical with the trademark and is used

in relation to goods or services which are identical

with those for which the trade mark is registered;

(b) the sign is identical with, or similar to, the trade mark

and is used in relation to goods or services which are

identical with, or similar to, the goods or services for

which the trade mark is registered, if there exists a

likelihood of confusion on the part of the public; the

likelihood of confusion includes the likelihood of

association between the sign and the trade mark;

irrespective of whether it is used in relation to goods

or services which are identical with, similar to, or not

similar to, those for which the trade mark is

registered, where the latter has a reputation in the

Member State and where use of that sign without due

cause takes unfair advantage of, or is detrimental to,

the distinctive character or the repute of the trade

mark.

3. The following, in particular, may be prohibited under

paragraph 2:

(a) affixing the sign to the goods or to the packaging

thereof;

(b) offering the goods or putting them on the market, or

stocking them for those purposes, under the sign, or

offering or supplying services thereunder;

(d) using the sign as a trade or company name or part of

a trade or company name;

(e) using the sign on business papers and in advertising;

(f) using the sign in comparative advertising in a

manner that is contrary to Directive 2006/114/EC.

Vol. 110 TMR 581

4. Without prejudice to the rights of proprietors acquired

before the filing date or the priority date of the registered

trade mark, the proprietor of that registered trade mark

shall also be entitled to prevent all third parties from

bringing goods, in the course of trade, into the Member

State where the trade mark is registered, without being

released for free circulation there, where such goods,

including the packaging thereof, come from third

countries and bear without authorization a trade mark

which is identical with the trade mark registered in

respect of such goods, or which cannot be distinguished

in its essential aspects from that trade mark.

The entitlement of the trade mark proprietor pursuant to the

first subparagraph shall lapse if, during the proceedings to

determine whether the registered trade mark has been

infringed, initiated in accordance with Regulation (EU) No

608/2013, evidence is provided by the declarant or the holder

of the goods that the proprietor of the registered trade mark

is not entitled to prohibit the placing of the goods on the

market in the country of final destination.

5. Where, under the law of a Member State, the use of a sign

under the conditions referred to in paragraph 2 (b) or (c)

could not be prohibited before the date of entry into force

of the provisions necessary to comply with Directive

89/104/EEC in the Member State concerned, the rights

conferred by the trade mark may not be relied on to

prevent the continued use of the sign.

6. Paragraphs 1, 2, 3 and 5 shall not affect provisions in any

Member State relating to the protection against the use

of a sign other than use for the purposes of distinguishing

goods or services, where use of that sign without due

cause takes unfair advantage of, or is detrimental to, the

distinctive character or the repute of the trade mark.

C. Cases

1. EU—CJEU—Can a trademark owner

bring an infringement action in a Member State

where advertising or offers for sale are directed at

that territory, even if the actual sale

is concluded in another territory?

AMS Neve Ltd., Barnett Waddingham Trustees, Mark Crabtree

v. Heritage Audio SL, Pedro Rodríguez Arribas

145

concerned the

question of whether an EU trademark owner could bring an

145

Case C-172/18 (CJEU, September 5, 2019) (EU:C:2019:674).

582 Vol. 110 TMR

infringement claim against an infringer in a Member State to which

Internet sales and advertising had been directed, in circumstances

where the eventual sale of such goods took place in a different

Member State.

AMS Neve (AMS) is a UK manufacturer and seller of audio

equipment with a registered EU trademark consisting of the figure

“1073” (the “Mark”) registered in class 9 for “sound studio recording,

mixing and processing equipment.” Heritage Audio SL (Heritage) is

a company established in Spain that sells and supplies audio

equipment.

In October 2015, AMS brought a claim for trademark

infringement in the UK IP Enterprise Court (“IPEC”) against

Heritage under Articles 9(2)(b) and (d) of the 2009 EUTM

Regulation, for allegedly offering for sale and advertising to

consumers in the UK imitations of goods of AMS bearing a sign

identical or similar to the Mark. Heritage applied for an order that

the UK courts did not have jurisdiction to hear the claim.

The IPEC held that, insofar as a dispute concerns infringement

of an EU trademark, in accordance with Article 97(1) of the 2009

EUTM Regulation the court of the Member State in whose territory

the defendant is domiciled will have jurisdiction. However, Article

97(5) states that the applicant may “also” bring an action in the

courts of the Member State in which the act of infringement has

been committed or threatened. It concluded that the courts of the

Kingdom of Spain, rather than the UK, had jurisdiction to hear this

claim. It was in this territory that Heritage was domiciled and

where the act of infringement, being the act of advertising or

offering for sale on its website the infringing goods, had been

committed.

AMS appealed to the Court of Appeal, which provisionally

considered that the IPEC had misinterpreted the relevant case law.

However, the position was not acte clair, so the proceedings were

stayed and the Court of Appeal referred the following questions to

the CJEU:

In circumstances where an undertaking is established and

domiciled in Member State A and has taken steps in that

territory to advertise and offer for sale goods under a sign

identical to an EU trade mark on a website targeted at

traders and consumers in Member State B:

i does an EU trade mark court in Member State B have

jurisdiction to hear a claim for infringement of the EU

trade mark in respect of the advertisement and offer for

sale of the goods in that territory?

ii if not, which other criteria are to be taken into account

by that EU trade mark court in determining whether it

has jurisdiction to hear that claim?

Vol. 110 TMR 583

iii in so far as the answer to (ii) requires that EU trade

mark court to identify whether the undertaking has

taken active steps in Member State B, which criteria are

to be taken into account in determining whether the

undertaking has taken such active steps?

Before the CJEU gave its preliminary ruling, Advocate General

Szpunar (AG) provided guidance on the interpretation of Article

97(5). The AG concluded that, in the circumstances set out in the

questions posed by the referral court, Member State B does have

jurisdiction to hear a claim for infringement of the EU trademark

as the territory where the act of infringement occurred in respect of

the advertisement and offer for sale of goods in that territory,

provided that it specifically targets the public in that Member State.

The AG provided a non-exhaustive list of targeting criteria,

including the following significant factors: (a) an offer and

advertisement refer expressly to the public of a specific Member

State; (b) they are available on a website with a country-specific top-

level domain of that Member State; (c) the prices are given in the

national currency; (d) telephone numbers on the website contain the

national prefix of the Member State; or (e) the offer for sale gives

details regarding the geographic areas to which the seller is willing

to dispatch, including those of the Member State (provided it is not

a general indication covering the whole of the EU).

The CJEU gave its ruling in early September 2019 and agreed

with the AG’s interpretation of Article 97(5), but without

commenting on the targeting criteria. The CJEU noted that, under

the circumstances of the present case, an EU trademark court must

be satisfied that the acts allegedly committed by the defendant were

committed in that territory. For cases where the infringing acts

consist of advertising and offers for sale displayed electronically, it

is necessary to follow the CJEU’s earlier judgment in L’Oréal and

Others.

146

Such acts falling within the scope of Articles 9(2)(b) and

(d) were committed in the territory where the consumers or traders,

to whom that advertising and those offers for sale are directed, are

located,

147

regardless of the fact that the defendant, the network

servers used, or the products related to such acts are established

elsewhere.

The CJEU rejected the IPEC’s narrow interpretation of Article

97(5) to refer to the place where the defendant took decisions and

steps to activate a display on a website. This was an inappropriate

interpretation, as it would deprive Article 97(5) from being an

alternative to Article 97(1). In addition, the CJEU noted that it is

146

Case C-324/09 (CJEU, July 12, 2011) (EU:C:2011:474).

147

Id. at para. 63.

584 Vol. 110 TMR

typically difficult, sometimes impossible, for the applicant to

identify this territory in the first place.

A wider interpretation of Article 97(5) was provided by the

CJEU, supported by its earlier judgments in Wintersteiger

148

and

Bolagsupplysningen and Ilsjan

149

that consider the suitability of the

place where the harmful event occurred due to its courts being best

placed to assess whether the mark has been infringed by reason of

proximity and ease of taking evidence.

2. Benelux—Benelux Court of Justice—

Does freedom of artistic expression constitute

“due cause” to use a trademark in an

artistic endeavor?

In its decision

150

of October 14, 2019, the Benelux Court of

Justice considered the balance of artistic expression and trademark

law, and in particular the relevance of “due cause” for the

incorporation of trademarks in artistic works.

Moët Hennessy Champagne Services holds the relevant rights

in all trademarks protecting the name and trade dress of DOM

PÉRIGNON champagne. An artist who had made several paintings

featuring this luxury product used the title “DAMN PÉRIGNON” to

refer to these paintings. The Brussels Commercial Court referred a

preliminary question to the Benelux Court of Justice in order to seek

guidance in applying the balance between, on the one hand,

exclusive trademark rights and, on the other hand, the artist’s

freedom of expression.

151

The question concerned, in particular, the

interpretation of “due cause” within the meaning of

Article 2.20(1)(d) of the Benelux Convention of Intellectual Property

(“BCIP”), which entitles the trademark holder to take action against

any use of the mark that is made otherwise than for distinguishing

goods, unless the defendant has a “due cause.” This rather specific

Benelux provision transposes Article 10(6) of the 2015 TM Directive

into national law protecting against the use of a sign other than use

for the purposes of distinguishing goods or services, where use of

that sign without due cause takes unfair advantage of, or is

detrimental to, the distinctive character or the repute of the

trademark.

The Benelux Court of Justice ruled that under Article 2.20(2)(d)

BCIP artistic expression constitutes “due cause” to use a sign that

is identical or similar to the registered trademark if it is used for

148

Case C-523/10 (CJEU, April 19, 2012) (EU:C:2012:220).

149

Case C-194/16 (CJEU, October 17, 2017) (EU:C:2017:766).

150

A 2018/1.

151

For commentary on this judgment, see Tom Scourfield, Annual Review of EU Trademark

Law: 2018 in Review, 109 TMR 441, 542-544 (2019).

Vol. 110 TMR 585

purposes other than those of distinguishing goods or services and,

insofar that the artistic expression is the result of a creative design

process. However, the artistic expression cannot be aimed at

harming the trademark or its proprietor. Discretionary power of the

court to continue this balancing exercise between artistic expression

and the rights of the intellectual property is needed on a case-by-

case basis.

The case is now referred back to the Brussels Commercial Court,

which will have to decide whether the artistic expression at stake

was aimed at harming the trademark or its proprietor.

3. France—French Supreme Court—

Can a trademark that has never been used

form the basis of a trademark infringement action?

Can a trademark that has been revoked for non-use on the

expiry of the period of five years following publication of the

registration nevertheless form the basis of an action for trademark

infringement in respect of acts carried out during the first five years

following registration? In such circumstances, can the trademark

proprietor seek compensation for the damage that it would have

suffered as a result of the use by a third party, prior to the date on

which the revocation took effect, of a similar sign for identical or

similar goods or services?

That, in essence, was the question referred by the French

Supreme Court

152

in Cooper International Spirits and others in

relation to a request for preliminary guidance from the CJEU, which

concerns the interpretation of Articles 5(1)(b), 10, and 12 of the 2008

Trademark Directive.

This question was raised in the context of trademark

infringement proceedings between an individual, the owner of the

French trademark SAINT GERMAIN filed for alcoholic beverages,

and three companies manufacturing and distributing an elderberry

liqueur under the name “St-Germain,” being Cooper International

Spirits, Établissements Gabriel Boudier, and St. Dalfour.

In parallel revocation proceedings in relation to the trademark

at issue, the Regional Court of Nanterre (France) had held that the

owner of the trademark SAINT GERMAIN filed to demonstrate

genuine use of its trademark since its filing, and ordered the

revocation of its rights as of the expiry of the five-year period that

followed the date of publication of the trademark registration.

In light of this revocation and the fact that the trademark had

accordingly never been commercially exploited, the first instance

court rejected the trademark owner’s claims in their entirety. The

Paris Court of Appeals upheld this judgment. In light of the

152

Case C-622/18.

586 Vol. 110 TMR

dissimilarities between the conflicting signs, limited to the

contraction of the word “SAINT” into “St” and the adjunction of a

dash, the infringement alleged by the plaintiff was in effect an

allegation of infringement by imitation. The Paris Court held that

the assessment of the likelihood of confusion in the public’s mind

implied that the mark invoked has been exploited in such a way as

to bring it into contact with consumers. This requirement not being

met, the Court concluded that the function of guarantee of origin of

that mark could not be impaired.

On appeal to the Supreme Court of France, the Court considered

cases such as Interflora and the requirement for a trademark to

always fulfil its function of indicating origin. It was unclear to the

Supreme Court whether such essential function could be adversely

affected in an infringement action in a case where the prior right

had in fact never been used. In this context the French Supreme

Court referred the following question to the CJEU:

Must Article 5(1)(b) and Articles 10 and 12 of Directive

2008/95 EC of the European Parliament and of the Council

of 22 October 2008 to approximate the laws of the Member

States relating to trade marks be interpreted as meaning

that a proprietor which has never exploited its trade mark

and whose rights over it were revoked on expiry of the period

of five years following publication of its registration can

obtain compensation for injury caused by infringement,

claiming an adverse effect on the essential function of its

trade mark, caused by use by a third party, before the

effective date of the revocation, of a sign similar to that trade

mark to designate goods or services identical or similar to

those for which that trade mark was registered?

The opinion of Advocate General M. Giovanni Pitruzzella was

rendered on September 18, 2019, and demonstrated a rather

different approach to that carried out by the French courts. The

Advocate General considered that a trademark owner enjoys the full

rights associated with a trademark until such time as it may be

revoked for non-use. As such, the trademark owner may seek

compensation for the damage he has suffered as a result of the use,

by a third party, prior to the effective date of revocation, of a similar

sign for identical or similar goods or services that are confusing with

his trademark. In such an action, the likelihood of confusion

between the conflicting signs must be assessed “by reference solely

to the elements resulting from the registration of the trademark.”

While the actual use made by the proprietor may be taken into

account in the global appreciation and assessment of all relevant

circumstances, such use is not a pre-requisite for the application of

that test.

The CJEU’s answer to these questions will be keenly awaited

and will no doubt feature in a future edition of this Review.

Vol. 110 TMR 587

4. Austria—Austrian Supreme Court—

To what extent may a logo trademark be used

in commercial communications without permission?

The decision of the Austrian Supreme Court in OGH

28.05.2019

153

considers the limits of lawful use of a third-party

logo/pictorial mark in marketing communications without the prior

consent of the trademark proprietor.

The plaintiff was the management company of an Austrian

soccer club, owning the respective rights in the logo/pictorial

trademark of the club in question. The defendant was a sports

marketing agency, with its registered office in Liechtenstein, which

owned, among others, the marketing and commercialization rights

in respect of two other Austrian soccer clubs. Prior to fixtures to be

played against the plaintiff’s club, the defendant sent out various

marketing communications in which the defendant offered its

advertising and hospitality services for upcoming matches of the

Austrian Soccer League (including LED strip advertising in the

stadium, VIP tickets as well as a VIP-box). Recipients of that email

included sponsors of the plaintiff.

The offending emails included not only the logos of the Austrian

soccer clubs represented by the defendant, but also the logo/pictorial

trademark of the club represented by the plaintiff. No prior

permission or license had been sought or obtained for such use.

Examples of such unauthorized use are set out below (with the

unauthorized use in the red circle).

153

OGH 28.05.2019, 4 Ob 77/19 f.

588 Vol. 110 TMR

The plaintiff claimed that the defendant’s unauthorized use of

the plaintiff’s trademark amounted to trademark infringement and

that such use unfairly exploited the goodwill in the trademark. The

defendant argued that the principle of exhaustion allowed this type

of use of the trademark. The plaintiff was successful at first

instance. On appeal, that decision was substantively upheld, but the

court narrowed the scope of injunctive relief.

On final appeal, the Austrian Supreme Court (OGH) held that

the rights in a registered trademark do not entitle the proprietor to

prohibit a third party from using the trademark for the purposes of

identifying or referring to goods or services as those of the

proprietor. In particular, use of a trademark cannot be prohibited

where such use is necessary to indicate the intended purpose of (its

own) goods or services, for example as accessories or spare parts,

provided that such use is in accordance with honest practices in

industrial and commercial matters.

154

However, to rely upon the principle of the exhaustion of rights,

the use of another’s trademark is permitted only where this is

necessary for the purpose of designating another product or service

and must in any event at all times comply with such honest

practices. As previously held by the Austrian Supreme Court in

earlier decisions,

155

as an exception to trademark law, this principle

must be interpreted in a narrow way. Accordingly, the use of a third-

party trademark is required to demonstrate the intended purpose of

the advertiser’s own goods or services only if this use is practically

the only means to fulfil this purpose (see in particular the CJEU

154

CJEU in Gilette, Case C-228/03 para. 41; CJEU in BMW, Case C-63/97, para. 61.

155

See, e.g., OGH 19.09.2011, 17 Ob 18/11k; OGH 17 Ob 2/11k.

Vol. 110 TMR 589

judgment in Gilette

156

). Further, such descriptive use of the third-

party trademark must not lead to an unfair use of the trademark,

examples of such unfairness being exploitation of or damage or

dilution to reputation, exploitation of attention and or the false

implication of a contractual relationship between the parties. On the

other hand, to constitute an exploitation of reputation it will not be

sufficient if the defendant actually benefits from the reputation and

the distinctive character of the plaintiff’s trademark, if and insofar

as that benefit is derived from the necessary (and hence permitted)

use of the trademark.

On the facts of the case at hand, the Austrian Supreme Court

held that there had indeed been an unlawful exploitation of the

reputation of the plaintiff’s trademark. The defendant, as the

marketing agency of two soccer clubs, had not merely identified the

football matches at issue by reference to the plaintiff as the opposing

team, but had also offered its own products in doing so, effectively

using the third-party trademark to advertise its own services. In

doing so, the defendant did not limit itself to merely naming the

opposing team for the purposes of identification of the relevant

fixture but had used the plaintiff’s logo/pictorial trademark several

times in its offer e-mail. Such use had an effect on the advertising

function of the third-party trademark and went beyond what could

be considered as a permitted use. The defendant had deliberately

used the plaintiff’s logo/pictorial trademark in order to benefit from

the attention paid to the plaintiff’s own offer of goods and services

associated with its goods and services.

5. Germany—Federal Supreme Court—

Use of a mounting device for a trademark

In its decision of March 7, 2019,

157

the German Federal Supreme

Court held that a “mounting device” for a trademark that is placed

on a spare part radiator grille can constitute trademark

infringement because the trademark remained recognizable even

before the actual trademark was affixed.

The plaintiff is an automobile manufacturer and owner of the

trademark rights in the famous AUDI logo consisting of four

interlocking rings.

156

CJEU in Gilette, Case C-228/03, para. 39.

157

Case No. I ZR 61/18.

590 Vol. 110 TMR

The trademark is registered, among others, for land vehicles and

parts thereof.

The defendant sells automobile spare parts and offered for sale

via the Internet replacement radiator grilles for AUDI cars.

(source: court decision)

The product itself provided for a mounting device for the AUDI

logo as show below.

(source: court decision)

Audi sued for trademark infringement to prevent the sale of

such products. The District Court held in favor of the plaintiff and

awarded an injunction. The defendant’s appeal was unsuccessful.

The Court of Appeal of Dresden confirmed the first instance decision

of the District Court of Leipzig. A further appeal to the Federal

Supreme Court was also unsuccessful.

The Federal Supreme Court considered that the attachment of

the mounting device for the logo to the radiator grille constituted a

use of a sign that is similar to the plaintiff’s device mark (consisting

Vol. 110 TMR 591

of the four interlocking rings). The fact that the rings were not all

overlapping, at least on the radiator grille as delivered, was not

sufficient to negate a likelihood of confusion. The fact that the sign

used by the defendant was just the supporting framework for the

logo didn’t help avoid infringement either. The plaintiff’s logo could

still be clearly recognized in the shape of the mounting device, and

the public could be expected to perceive the mounting device as an

indication of origin as well as a means to attach the logo to the grille.

The Federal Supreme Court also rejected the defendant’s

argument that the mounting device was “necessary” to indicate that

the radiator grille was intended to serve as a spare part for AUDI

automobiles, such that it would have a defense under Article 14(1)(c)

of the 2017 EUTM Regulation.

According to Article 14(1)(c) of the 2017 EUTM Regulation:

an EU trade mark shall not entitle the proprietor to prohibit

a third party from using, in the course of trade the EU trade

mark for the purpose of identifying or referring to goods or

services as those of the proprietor of that trade mark, in

particular, where the use of that trade mark is necessary to

indicate the intended purpose of a product or service, in

particular as accessories or spare the EU trade mark for the

purpose of identifying or referring to goods or services as

those of the proprietor of that trade mark, in particular,

where the use of that trade mark is necessary to indicate the

intended purpose of a product or service, in particular as

accessories or spare parts.

The Court of Appeal had not expressly considered whether the

public perceived the mounting device as an indication that the

radiator grille was an AUDI spare part. The Federal Supreme Court

assumed this to be the case. However, the Federal Supreme Court

did not consider that this way of using the sign was necessary to

indicate the character of the radiator grille as an AUDI spare part.

It considered that the use is necessary for this purpose only if the

character of the radiator grille as an AUDI spare part could not be

indicated in another way. As there are other ways of indicating such

compatibility, such as an indication on the sales description and

other tags on the sales offer on the relevant website, or on the bill of

lading, the use could not be protected by Article 14(1)(c) of the

EUTMR.

The Federal Supreme Court acknowledged that there is an

expectation that spare parts for a motor vehicle will have the same

appearance as the original part, since otherwise they would not be

suitable for their purpose. Since the public’s expectation is that a

spare part that is not manufactured by the trademark owner must

nevertheless visually correspond to the original, a spare part such

as a bonnet or a radiator grille to which the manufacturer typically

fixed his trademark must provide a mounting device to affix the

592 Vol. 110 TMR

manufacturer’s trademark after installation of the spare part.

However, in this case the defendant did not claim that the relevant

mounting device was necessary to make the radiator grille look like

a radiator grille manufactured by the plaintiff once the original

brand emblem had been affixed to the spare part.

Finally, the Federal Supreme Court pointed out that the

defendant could not rely on the spare part provision of Article 110

CDR (Council Regulation (EC) No. 6/2002 on Community designs),

according to which

until such time as amendments to this Regulation enter into

force on a proposal from the Commission on this subject,

protection as a Community design shall not exist for a design

which constitutes a component part of a complex product for

the purpose of the repair of that complex product so as to

restore its original appearance.

According to the Federal Supreme Court, the spare part

manufacturer or the dealer who sells spare parts not originating

from the manufacturer is not permitted under Article 110 CDR to

manufacture spare parts bearing a sign identical to the

manufacturer’s trademark. This provision does not justify a

derogation from the EUTMR. The restrictions of the exclusive right

conferred by an EU trademark are governed exclusively by the

EUTMR.

6. Germany—Federal Supreme Court—

When does use of a term as a model or style name

amount to trademark use and risk infringement?

In two decisions of March 7, 2019,

158

and April 11, 2019,

159

relating to similar issues, the Federal Supreme Court considered

whether the use of a name to describe individual garments or styles

within a retailer’s range (referred to in the decision as a “model”

name but perhaps also described as a “style” name in English) would

be an infringement of a similar or identical trademark.

It is increasingly common for retailers, particularly in the online

retail environment, to use a model or style name to identify and

distinguish individual product lines within an overall product

portfolio. In the first decision, the plaintiff was the proprietor of the

trademark SAM, registered for clothing. The defendant offered

trousers under a range of model/style names, including SAM as the

model name of trousers also bearing the trademark EUREX. This

trademark was further distinguished by reference to an “umbrella”

trademark, EUREX BY BRAX, as set out below.

158

Case No. I ZR 195/17 (SAM).

159

Case No. I ZR 108/18 (MO).

Vol. 110 TMR 593

(source: court decision)

The model name “SAM’” was neither placed in the title of the

product presentation within the online shop nor was in visual

emphasis but was visible only in an overview of the product details

of the trousers with statements on “look,” “closure,” “pockets,”

“upper material,” “color,” and “model.”

In the second decision, the plaintiff was the proprietor of a

trademark MO registered for ladies outer clothing and trousers. The

defendant offered trousers designated, among other things, as

“Bench Damen Hose MO.”

594 Vol. 110 TMR

(source: court decision)

The Court of Appeal of Frankfurt/Main held that in both cases,

use of the model names “SAM” and “MO” was use as a trademark

and therefore infringed the plaintiffs’ respective trademarks SAM

and MO. Neither of the trademarks SAM and MO were by their

nature descriptive of the product nor merely decorative. Both SAM

and MO were capable of distinguishing between products from

different manufacturers. In the Court’s view, that was the case even

Vol. 110 TMR 595

where customers recognized that the model name also served

internal purposes of the manufacturer, namely, to identify the

trousers within the collection. The Court accepted that this rule

would not apply where customers were unlikely to attribute the

model/style name to a particular manufacturer because they knew

that it was also used by several other manufacturers. This was not

the case with SAM or MO, even though the general industry practice

of using first names, surnames, artist’s name, or abbreviations was

well known.

The Federal Supreme Court overruled both decisions. In relation

to the alleged infringement of the trademark MO, the fact that the

element “MO” was part of the overall presentation “Bench Damen

Hosen MO” (translated as “Bench ladies’ trousers MO”) was not of

itself sufficient to prevent infringement. The separation of the

marks BENCH and MO by the descriptive indication “Damen

Hosen” (“ladies’ trousers”) presented these elements as two

independent signs and “MO” was obviously identical to the

plaintiff’s trademark. However, in respect of both trademark cases

the Court considered that the customer’s perception as a trademark

must be positively established and it was too vague to merely

assume that customers would automatically assume the model

names “SAM” or “MO” to be indications of origin distinguishing

those garments from those from other manufacturers.

The Court gave some guidance as to how this might be

considered in practice. First, the model name cannot be identical to

a particularly well-known mark or one with a reputation where an

association or exploitation with that trademark can be assumed

(such as “501” jeans). Second, if not already well-known, customer

perception may be influenced by industry practice. If the same

model name is used by several manufacturers to differentiate within

their collections and presented to consumers accordingly, it would

not be possible for that model name to differentiate the products of

one manufacturer from another. Thirdly, the position of the model

name in the overall presentation can also be relevant. A model name

is more likely to be interpreted as trademark use where the model

name is used in direct connection with a manufacturer’s name or

umbrella trademark (and is therefore attributed to that

manufacturer), is highlighted graphically, or appears in a place

where trademarks are typically affixed (e.g., directly to the product

or on sales labels). With these guidelines, the Federal Supreme

Court referred the cases back to the Court of Appeal for further

consideration and new decision, as well as providing valuable

guidance for both retailers and trademark proprietors as to the

nature of acceptable and unobjectionable use in this context.

Applying these guidelines of the Federal Supreme Court, the

Court of Appeal held in a decision of October 1, 2019 (published in

February 2020) that the model name “SAM” was not used as a

596 Vol. 110 TMR

trademark in this case because it was not well-known and used only

in a subordinate position.

7. Spain—Appeal Court of Alicante (EUTM

Tribunal)—The infringement of well-known marks

does not require a likelihood of confusion.

The decision of the EU Tribunal of the Appeal Court of Alicante

in KIDS (judgment 556/2019 of April 30, 2019, Appeal No. 66/2019)

considered the interaction between the relevant tests for confusion

and marks with a reputation.

160

The plaintiff was a Spanish company, KIDS & US ENGLISH

S.L., owner of the EUTM KIDS & US, registered for education and

training services (below, left). The plaintiff operated 377 language

schools for children, educating around 115,000 students per year

with an annual turnover of 70 million EUR, advertising expenditure

of over a million EUR and having received many awards and

recognitions for its operations.

The defendant, the company Kids & Teens S.L, domiciled in La

Rioja (Spain), had opened several language schools for children

under the name “Kids & Teens” and had registered Spanish

Trademark No. 3110587 KIDS & TEEN fig. in class 41 (below,

right).

The plaintiff issued trademark infringement proceedings and

sought an invalidity action against the defendant’s trademark in the

Commercial Court of Alicante, claiming both (i) a likelihood of

confusion between the marks in respect of the provision of identical

services and (ii) unfair advantage of the reputation of the trademark

KIDS & US. The defendant argued that reputation had not been

proven and that there was no likelihood of confusion between the

marks because the common elements “KIDS” and “School of

English” were descriptive terms that could not be monopolized by

the plaintiff. The defendant maintained that the differences in the

final element of the marks “TEENS” versus “US,” together with the

different overall impression of the marks, was sufficient to negate

any risk of confusion.

160

Judgment 556/2019 of April 30, 2019, the Appeal Court of Alicante (Appeal No. 66/2019).

Vol. 110 TMR 597

The Commercial Court of Alicante upheld the complaint on

October 10, 2018,

161

finding for the plaintiff on both grounds and

ordering the cancellation of the mark KIDS & TEENS. The first

instance decision was based on the finding of a likelihood of

confusion (association) between the marks and for the later mark

taking unfair advantage of the reputation of the earlier trademark

KIDS & US.

The decision was appealed, the defendant once again denying

the well-known character of the earlier trademark and arguing

there was no likelihood of confusion between the marks due to their

different overall impression and the lack of distinctiveness of the

comment elements between the marks.

The Appeal Court of Alicante upheld

162

the decision of the first

instance court, but only on the basis of unfair advantage of the

reputation of the earlier marks. The Appeal Court of Alicante

emphasized that infringement/invalidity arising from unfair

advantage of a mark with a reputation was an independent ground

to a finding of a likelihood of confusion. The plaintiff needed only to

prove similarity in the marks to the extent that consumers might

establish a link between them and a corresponding advantage to the

defendant.

The Court agreed that the common element KIDS was not

distinctive, and that the overall impression of the marks was quite

different so as to avoid a likelihood of confusion. However, after

regarding the earlier trademarks as well-known, it concluded that

the similar structure of both marks (the term KIDS + & + another

English term) was sufficient to create the link required.

The Alicante Appeal Court applied the findings of the CJEU

Adidas/Fitnessworld

163

where the Court stated that “The protection

conferred by Article 5(2) of Directive 89/104 is not conditional on a

finding of a degree of similarity between the mark with a reputation

and the sign such that there exists a likelihood of confusion between

them on the part of the relevant section of the public. It is sufficient

for the degree of similarity between the mark with a reputation and

the sign to have the effect that the relevant section of the public

establishes a link between the sign and the mark.” Although in some

respects it might be argued that there is a fine line between the

concepts of “likelihood of association” (included in the broader

concept of likelihood of confusion) and “similarity between the

marks to have the effect that the relevant section of the public

establishes a link,” it is generally accepted that the link required for

a mark with a reputation is a somewhat lower threshold to meet,

161

Judgment 196/18 of October 10, 2018.

162

Judgment 556/2019 of April 30, 2019.

163

Case C-408/01.

598 Vol. 110 TMR

provided the consequences of such link are likely to result in the

harm complained of.

8. UK—High Court—Did the use of a similar mark

to a registered trademark take unfair advantage

of an earlier trademark with a reputation?

Claridge’s Hotel Ltd. v. Claridge Candles Limited & Anor

164

concerned the well-known hotel Claridge’s and its UK trademarks

for the mark CLARIDGE’S, registered for various goods and

services in classes 3, 5, 16, 35, 43, and 44. In January 2018, the

defendants filed an application for “CLARIDGE” for various goods

in class 3 and 4 and for use in respect of the sale of “CLARIDGE”-

branded candles and other goods, as reproduced below:

In October 2018, Claridge’s brought a claim for trademark

infringement (under Sections 10(2) and 10(3) of the UK Trade Mark

Act 1994 (the “Act”)) and the common law tort of passing off. The

defendants counterclaimed for revocation of both of the hotel’s

marks for non-use. This counterclaim prompted Claridge’s to

voluntarily surrender one of its trademarks in its entirety and

partially surrender the other in respect of some goods and services.

Claridge’s also opposed the application and the UKIPO opposition

was stayed pending the result of this case.

The High Court turned first to the issue of reputation to

establish whether the mark was entitled to the extended form of

protection. Claridge’s, in relying on those parts of its remaining

registration relating to retail, hotel, and beauty services provided

substantial evidence (including press coverage, marketing

expenditure, and turnover figures of £50 million per annum),

successfully persuading the Court of the mark’s substantial

164

[2019] EWHC 2003 (IPEC).

Vol. 110 TMR 599

reputation. While the defendants did not dispute the evidence in

respect of hotel services in class 43, they argued that (i) the class 44

beauty treatments and spa services were not offered under the

CLARIDGE’S mark at all, and could not therefore have gained such

a reputation and (ii) the class 35 retail services related to its sale of

various branded items that were sold at the hotel and via an online

gift shop and did not amount to genuine use. Rejecting the

defendants’ arguments, the Court held that the mark CLARIDGE’S

is known by a significant part of the public concerned with the

products or services covered by the trademark and in particular, has

an image of “luxury, glamour, elegance and exclusivity” due to the

plaintiff’s use.

In considering whether the defendants’ acts in relation to their

CLARIDGE sign constituted infringement pursuant to Section 10(3)

of the Act, the Court referred to the case of Argos Limited v. Argos

Systems Inc.,

165

where the Court of Appeal had reiterated that it is

sufficient to show a change in economic behavior of customers for

the defendant’s goods or services to show that the use of a sign is

taking unfair advantage.

In considering whether there might be a link between the

defendants’ sign and CLARIDGE’S in the mind of the average

consumer, the Court carried out a global assessment. The Court

noted that the mark and sign are visually and aurally almost

identical and agreed with the plaintiff that there was a high degree

of conceptual similarity. The Court also observed that while the

parties’ goods and services are different, they are both “premium

offerings” and may therefore appeal to a similar part of the public.

Furthermore, the mark CLARIDGE’S is inherently distinctive and

had acquired a high degree of distinctive character by virtue of its

long and well-publicized use. The Court therefore concluded that the

defendants’ use of the CLARIDGE sign did not only take advantage

of the repute of the CLARIDGE’S mark but also of its reputation for

“luxury, glamour, elegance and exclusivity,” the effect being to

enable the defendants to sell more of their products and at a higher

price. Given the Court’s finding of unfair advantage, an assessment

of tarnishing/dilution was not required, and the conclusion applied

to all of the defendants’ products, both those they have already sold

and those they intended to sell.

As part of its claim, Claridge’s had also submitted that the

company director (the second defendant) was personally liable for

the company’s acts of infringement. In considering the evidence,

including evidence that the company director was the only employee

of the company, the Court agreed that it was indeed the company

165

[2018] EWCA Civ. For commentary on the case, see Tom Scourfield, Annual Review of

EU Trademark Law: 2018 in Review, 109 TMR 552-553 (2019).

600 Vol. 110 TMR

director who had “actually offered CLARDIGE-branded candles to

the public” and was therefore liable.

It followed that in its assessment of passing off, the Court

confirmed that the defendants’ use of CLARIDGE on its products is

likely to lead the public to believe the goods offered by the

defendants are the goods of Claridge’s or that there is some trade

connection or association between the two parties.

166

Claridge’s

therefore also succeeded in its passing off claim.

In determining the counterclaim for revocation, the Court

reiterated that “genuine use” was use that creates or preserves a

market for the goods or services that bear the mark.

167

The Court

rejected Claridge’s argument that there was a difference between

(a) goods and services that were offered on a purely promotional or

ancillary basis and (b) goods or services that were offered in

association with other services but that were promoted in their own

right and that constituted a factor in the decision of consumers to

choose the associated service. Taking into account the defendants’

additional arguments on the facts (including evidence of non-use),

the defendants’ counterclaim for revocation in relation to certain

goods and services in classes 3, 5, 16, 35, 43, and 44 succeeded. This

had the effect of revoking all aspects of the mark that the proprietor

had relied upon to demonstrate similarity of goods according to

Section 10(2) of the Act.

Despite the differences between the goods and services offered

by the parties, Claridge’s claim demonstrated the purpose behind

extended protection for marks with a reputation (Section 10(3) of

the Act); to protect trademark owners with extensive brand

reputation from third parties using its brand on dissimilar goods in

a way that takes unfair advantage of that reputation. However, in

the process, Claridge’s was forced to surrender one of its trademark

registrations in its entirety and saw the specification of another of

its trademark registrations cut down significantly.

9. UK—High Court—Is a mark consisting of

two separate elements one “combined sign” or

two separate signs for the purposes of

infringement proceedings?

Bentley 1962 Ltd. & Anor v. Bentley Motors Ltd.

168

concerned the

well-known luxury car manufacturer Bentley Motors and its use of

a sign featuring the “B-in-wings” device and the word “BENTLEY”

(the “Combination Sign”), for clothing and headgear. The plaintiffs

(known collectively as “Bentley Clothing”) are a small family-run

166

Reckitt & Colman Products Ltd. v. Borden Inc., [1990] RPC 341.

167

The London Taxi Corporation v. Frazer-Nash Research, [2016] EWHC 52.

168

[2019] EWHC 2925 (Ch).

Vol. 110 TMR 601

company that sells clothing under the brand “Bentley” and are the

owners of three UK-registered trademarks, including for the word

mark BENTLEY for “clothing and headgear” in class 25.

Since 2015, the parties have been involved in proceedings before

the UK and EU Intellectual Property Offices over the ownership of

the mark BENTLEY. The present case relates to the plaintiffs’

action for trademark infringement in the English High Court

against Bentley Motors’ use of the Combination Sign. The relevant

marks are reproduced below:

Bentley Clothing’s UK

trademarks

Bentley Motors’ Combination Sign

A key question for the High Court was whether the Combination

Sign consisted of two signs used together (i.e., the “B-in-wings” logo

and the BENTLEY sign) or just one single sign. This question was

important for determining whether the Court’s analysis would be

based on Section 10(1) of the Trade Marks Act 1994 (“Act”) (for use

of identical signs for identical goods) equivalent to Article 10(2)(a)

of the 2015 TM Directive or Section 10(2) of the Act (for use of a

similar sign for identical goods equivalent to Article 10(2)(b) of the

2015 TM Directive. Bentley Clothing argued that the Combination

Sign consisted of two distinct signs used together and was therefore

an infringement under Section 10(1) of the Act. Bentley Motors

disagreed. The distinction can be of significant importance in

litigation, since double identicality under Article 10(2)(a) of the 2015

TM Directive does not require any likelihood of confusion to amount

to infringement.

In considering the evidence, the Court observed that the

distinction between the Combination Sign being one or two signs

was not expressly considered by Bentley Motors until 2014 (at which

602 Vol. 110 TMR

point Bentley Motors had amended their company brand guidelines

to provide that the Combination Sign be used together “from now

on”). In particular, the Court noted that the company had used

BENTLEY and the “B-in-wings” logo separately for several years: a

swing tag attached to clothing marketed by Bentley Motors in or

around 2006 read “‘Bentley’ and the ‘B-in-wings’ device are

registered trademarks”; licenses provided by Bentley Motors

permitted licensees to use both the word “BENTLEY” and the “B-

in-wings” device together or separately on clothing; and the 2006

Bentley Motors brand guidelines that identified logos used by the

brand, presented the “B-in-wings” device without the word

“BENTLEY” below it. According to the Court, the evidence

suggested that Bentley Motors’ own perception was that the

Combination Sign featured two distinct signs (as well as a false

claim of ownership of BENTLEY as a UK trademark for clothing).

The Court turned to the perception of the average consumer. The

Court confirmed that given the BENTLEY and “B-in-wings” signs

had been used separately for a long period of time, the average

consumer would likely have taken them to be distinct signs. In

particular, the Court noted that while Bentley Motors’ licensees

would have known that the Combination Sign was to be treated as

one sign, the average consumer would not have been aware of the

company’s new intentions. Specifically, both the average consumer

in the early 2000s and those after 2014 would be familiar with both

the “B-in-wings” logo and the BENTLEY mark as individual

trademarks, not to mention that the BENTLEY logo continues to be

used extensively by itself. The Court confirmed that while

BENTLEY may no longer be used in the case of clothing and

headgear, the average consumer would not be observant enough to

notice this. There had therefore been an infringement under Section

10(1) of the Act based on the use of the identical mark BENTLEY.

Addressing the position under Section 10(2) of the Act, the Court

agreed with Bentley Clothing that even if the Combination Sign was

seen to be a single sign by the average consumer, its use would still

infringe Bentley Clothing’s trademarks under Section 10(2) of the

Act. The Court observed that the dominant elements of both the

Combination Sign and the BENTLEY mark was the word

“BENTLEY.” Moreover, the widespread reputation of the “B-in-

wings” device in relation to Bentley cars meant that the majority of

the people in the UK would make the connection to Bentley Motors.

The Court therefore concluded that there was a strong likelihood of

confusion between the relevant marks, notwithstanding a lack of

actual evidence of such. The Court also noted that this finding was

reinforced by the manner in which the Combination Sign would be

referenced orally by the average consumer.

Bentley Motors raised two defenses against a finding of

infringement. The first related to the transitional provisions of the

Vol. 110 TMR 603

Act, which allows for continued use of a sign that was lawful under

the preceding Trade Marks Act 1938, but which was no longer

lawful under the Act. The second considered the defense of honest

concurrent use. In considering Bentley Motors’ first defense, the

Court observed that the company had, prior to the Act, sold jackets,

silk ties, caps, and scarves under the “BENTLEY SELECTION.” At

that time, the only trademark that Bentley Clothing had registered

covered “knitted clothing, shirts and waistcoats.” It was therefore

accepted that Bentley Motors had a continuing right to sell

garments of that kind. However, the Court indicated that the

defense did not allow for parties to continue to trade as they had

prior to the Act and yet also branch into new uses of signs that had

since become the exclusive rights of trademark proprietors (e.g.,

garments of clothing falling outside of jackets, silk ties, caps, and

scarves). The Court therefore dismissed Bentley Motors’ first

defense as it did not consider that the Act allowed parties to start

selling different types of clothing and headgear under the

BENTLEY sign.

Bentley Motors’ second defense related to honest concurrent use

under Section 7 of the Act. The company argued that there had been

concurrent use of BENTLEY as a trademark by both parties for

more than twelve years without leading to any confusion. The Court,

on considering the approach taken in the case of Victoria Plum Ltd.

v. Victorian Plumbing,

169

noted that it is possible for two separate

entities to co-exist and for confusion to be tolerated in the market.

However, the Court explained that this is on the basis that the

defendant does not take steps to exacerbate the level of confusion

beyond that which is inevitable and/or encroach on the plaintiff’s

goodwill. In this case, the Court concluded that Bentley Motors’

“conscious decision to develop the use of BENTLEY in relation to

Bentley Motors’ range of clothing and headgear such as to increase

the prominence of that sign, but only in incremental stages in the

hope that no one stage would provoke a reaction from Bentley

Clothing” was not consistent with honest behavior. In particular, it

had become clear from Bentley Motors’ actions that it intended to

increase the prominence of the BENTLEY sign so as to encroach on

Bentley Clothing’s goodwill. The Court also noted that the little or

no confusion between the parties was a result of their modest level

of trading for clothing and headgear and did not have a bearing on

Bentley Motors’ honest practices. Bentley Motors was therefore also

unsuccessful with this line of defense.

169

[2016] EWHC (Ch).

604 Vol. 110 TMR

10. Benelux—District Court of Luxembourg

(Luxembourg)—Infringement—Validity—

Coexistence between national and EU trademarks

In Skylink,

170

the District Court of Luxembourg heard an

infringement claim brought by the British company Sky PLC and

its Swiss subsidiary Sky International AG (“Sky”), which had

registered and used the trademark SKY for a variety of domain

names and commercial names in respect of the provision of

telecommunications, entertainment, and satellite pay-tv services.

The action was brought by Sky against two Luxembourg companies,

X. Group SA, and its subsidiary, X2. Link SA (“X”), on the ground

that their use of “SKYLINK” in the Czech Republic and Slovakia for

satellite-related services was infringing at least two of the SKY

European trademarks (the “SKY Trademarks”

171

). X had also

applied for national trademarks in the Czech Republic and Slovakia

(the “SKYLINK Trademarks”).

To defend itself against the infringement action brought by Sky,

X claimed the SKY Trademarks were invalid. As part of such

counterclaim and on the basis of Article 128 (4) of the 2017 EUTM

Regulation, the Court noted, in its first decision dated February 9,

2018, that it had not been informed by the parties of the date on

which the EUIPO was made aware of the invalidity counterclaim.

The Court decided that, before going into any further details as to

the merits of SKY’s infringement action, X had to indicate to the

tribunal whether X had informed the EUIPO of the invalidity

proceedings, or if it was requesting the Court to do so. A hearing in

relation to the jurisdiction issues took place on February 9, 2018,

with this substantive decision on the merits being rendered in July

2019.

The Court first considered the counterclaim of X according to

which the SKY Trademarks should be invalidated for lacking

distinctiveness in respect of satellite television services (in class 38).

The Court noted that the applications for invalidity had now been

notified to the EUIPO. The arguments of X that the SKY mark

should be invalidated for lack of distinctive character failed. A

trademark can be invalidated only if it is wholly descriptive of a

characteristic of the products and/or services concerned (i.e., if the

trademark is composed exclusively of signs designating the kind,

quality, quantity, destination, geographical origin, or time of

production of the goods and/or services). In that respect, the Court

considered that, even if weakly distinctive (according to X), the SKY

Trademarks are not descriptive of satellite television services, as

the essential characteristic of a satellite is gravity and the term

170

District Court of Luxembourg, February 9, 2018, and July 5, 2019, no.162.816.

171

EU trademarks for SKY no. 006870992 and no. 004274288.

Vol. 110 TMR 605

“SKY” does not refer to such characteristic but to the part of the

atmosphere and the space seen from earth.

In relation to the infringement claim of SKY versus SKYLINK,

X argued that the use of a valid national trademark could not

amount to an infringement of a European trademark. In that

respect the court reiterated that it already ruled in its (related)

decision of February 9, 2019, that the principle of coexistence

between European and national trademarks does not mean that a

national trademark cannot be subject to an infringement action.

That being said, an infringement action brought on the basis of

Article 9(2)(b) of the 2017 EUTM Regulation required four

conditions to be met:

(i) an identity or similarity between the trademark and the

sign;

(ii) an identity or similarity between the goods and services;

(iii) a risk of confusion; and

(iv) a use of the sign in respect of trade.

The Court noted that the second condition listed above,

similarity of goods/services, and the fourth condition listed above,

trademark use, were not challenged by the parties.

In determining infringement arising from a likelihood of

confusion and an impact on the essential function, the Court first

identified the relevant public for assessment. Sky argued such

public should comprise the whole EU, while X argued that it should

be limited to Czech Republic and Slovakia, where the national

SKYLINK Trademarks were registered.

As established in DHL,

172

in accordance with the unitary

character of an EUTM, the EU trademark must receive the same

protection throughout the whole territory of the EU and carries with

it the prohibition to carry out infringing acts. However, the

territorial scope of the prohibition can be limited when use of an

attacked sign in a specific territory is not capable of infringing the

functions of that trademark. The Court then concluded that, if in

the only Member States where SKYLINK is used there is no risk of

confusion, then the essential function of the trademark is not

undermined and the relevant public must be territorially limited to

the countries where the use of the sign at issue is proved, without

taking into consideration the whole territory (EU) of the earlier

marks. The Luxembourg Court considered this to be the case even

though DHL was arguably only an exclusion of those territories

from the imposition of an injunction, rather than a finding of non-

infringement.

On the facts of Skylink, based on the evidence provided by the

parties (such as surveys) and as the SKYLINK Trademarks were

172

Case C-235/09 (DHL) (CJEU, April 12, 2011).

606 Vol. 110 TMR

used in Czech Republic and Slovakia and the content of the related

websites only provided in the national languages of those two

countries, the Court considered that the alleged infringement of the

Sky Trademarks only had to be analyzed with respect to Czech

Republic and Slovakia. The Court further decided that the relevant

public to be considered was both the general public and (more

informed) professionals. Nevertheless, the risk of confusion should

be analyzed with respect to the group having the lowest degree of

attention, being the general public.

173

Turning then to the risk of confusion for the general public

between the SKY Trademarks and the SKYLINK Trademarks, the

Court considered that the SKY Trademarks and the SKYLINK

Trademarks are visually and phonetically similar. With respect to

the conceptual similarity, the Court noted that it should be

determined how the term “SKYLINK” was perceived by the relevant

public (in the Court’s view that being the Czech and Slovakian

consumer) and whether the sign was perceived as one single term

(i.e., “SKYLINK”) or as two terms (i.e., “SKY” and “LINK”).

For Czech Republic, based on the final decision of the Czech

administrative Supreme Court and the factual information provided

by the parties (including surveys), the Court noted that the term

“SKYLINK” should be perceived as one single term as the verbal

element “SKY” is not dominant over the verbal element “LINK” and

as it cannot be excluded that the consumer does not hear the second

syllable. In that respect, the Court considered that Sky did not bring

sufficient evidence to support a risk of confusion in Czech Republic

between the SKY and the SKYLINK Trademarks (although some

commentators have questioned whether this was the correct test to

apply in any event).

For Slovakia, the Court first noted that the decisions of the

Slovak Intellectual Property Office, which invalidated the

SKYLINK Trademarks, are not final and did not analyze the risk of

confusion. Therefore, as (i) the decisions of the Slovak Intellectual

Property Office are not final, as (ii) the burden of proof of the risk of

confusion lies on the plaintiff (i.e., Sky) and as (iii) the decisions of

the Slovak Intellectual Property Office and the Czech

Administrative Supreme Court are divergent, the Court concluded

that the risk of confusion between the SKY and the SKYLINK

trademarks was not established by the plaintiff.

Finally, the Court considered the claim based on Article 9(2)(c)

of the 2017 EUTM Regulation according to which the SKY

Trademarks would be trademarks with a reputation. To qualify for

extended protection, that trademark must have attained a certain

degree of knowledge among the public and be known to a significant

173

Guidelines for examination of European Union Trademarks, Part C, Section 2,

Chapter 3, p. 6; ECG, Case T-220/09 (GC, July 15, 2011).

Vol. 110 TMR 607

part of the public concerned by the goods covered by the trademark.

From a territorial perspective, the condition relating to the

reputation is considered to be fulfilled when the trademark enjoys a

reputation in a substantial part of the EU, such part being able to

correspond namely to the territory of a single Member State.

Based on the factual elements provided by Sky, the court noted

that the SKY Trademarks are trademarks with a reputation as they

are widely known in various Member States such as the UK,

Ireland, Germany, Italy, or Luxembourg. A trademark with a

reputation may prevent the use without due cause of a subsequent

trademark, which would be taking unfair advantage of the

distinctiveness or renown of the trademark with a reputation. The

infringement of a trademark with a reputation is the consequence

of a certain degree of similarity between such trademark and the

later trademark as well as other factors such as the similarity of the

goods and services, the public concerned, the intensity of the

reputation or the degree of distinctiveness.

Even if the earlier trademark is not known to a significant part

of the relevant public in a Member State in which registration of a

later national trademark has been applied for, it cannot be excluded

that a commercially significant part of such Member State is aware

of that renowned trademark and establishes a link between that

renowned trademark and the national trademark. The existence of

such link has to be assessed globally, taking into account all the

relevant factors.

In the case at hand, the Court had to determine if a significant

part of the relevant public in Czech Republic and Slovakia are aware

of the SKY Trademarks and their reputation. Even if Sky was able

to produce before the Court data regarding the number of views of

the website www.skysports.com in Czech Republic and Slovakia, the

Court noted that Sky does not directly offer satellite television

services in Czech Republic or Slovakia, which does not fulfill the

requirement that the trademark with a reputation is commercially

exploited on the territory of the Member State where the national

trademark is registered.

In the alleged absence of commercial exploitation of the SKY

Trademarks in Czech Republic and Slovakia, the SKY trademarks

could be considered as renowned because of the accessibility of the

“sky sport” and “sky news” websites in Czech Republic and Slovakia.

However, Sky did not submit any surveys proving knowledge of the

SKY Trademarks for satellite television services by a commercially

non-negligible part of the relevant public in Czech Republic and

Slovakia. On this basis, the Court rejected Sky’s claim based on

Article 9(2)(c) of the 2017 EUTM Regulation.

608 Vol. 110 TMR

11. Belgium—Brussels Enterprise Court—

Can Amazon be held liable for the presence of

counterfeit goods on its platforms?

In its decision of August 7, 2019,

174

the Brussels Enterprise

Court considered that the well-known online retailer Amazon could

be held liable in trademark law for the sale of counterfeit goods on

its platform.

The French shoe designer Christian Louboutin had identified

that many counterfeit high heels bearing a (famous) red sole were

offered for sale on the amazon.fr and amazon.de websites. On

Louboutin’s behalf, a Brussels-based bailiff reported both test sales

made in Belgium and the targeting of offers for sale of such products

to consumers within Belgium. Louboutin sued the Luxembourg-

based Amazon companies that were responsible for operating the

amazon.fr and amazon.de websites and for arranging the deliveries

to consumers in Belgium. Louboutin claimed infringement of

Benelux Trademark No. 874489, as reproduced below.

Amazon argued that it was merely the host platform and that it

had a defense as a mere host, which could not be held liable for

infringing goods on its online platforms. The Brussels Court rejected

that defense and ruled in favor of Louboutin. The Court considered

that Amazon was not a “mere host” in such circumstances. The

Court considered that Amazon had placed the products on dedicated

fashion pages called “Amazon Fashion” or “Amazon Business” and

by advertising such products with language such as “our goods,”

“our service,” “our delivery of goods,” “our best offer,” “our selection

of the best goods,” etc., it had gone beyond merely offering a sales

platform. In such circumstances, Amazon had created a shopping

environment and customer experience where the end clients

believed that it was indeed Amazon that was responsible for the

promotion and the sale of the goods. Playing such an active role in

the presentation and promotion of such goods, Amazon was liable

for trademark infringement.

Amazon also argued that it would be effectively impossible to

comply with an injunction due to the sheer scale of their activities.

174

A/2019/918.

Vol. 110 TMR 609

The Brussels Court rejected this allegation outright. Any illegal or

infringing activities must be stopped, even more so if they are at

significant scale. The Court ordered a Benelux wide injunction

against Amazon to stop selling and promoting goods that infringe

Louboutin’s Benelux trademark registration.

VII. LIMITATION OF RIGHTS AND DEFENSES

A. Introductory Comments

EU trademark law contains a variety of specific defenses and

other limitations on the exclusive rights conferred upon trademark

proprietors. Article 14 of the 2017 EUTM Regulation (together with

Article 6 of the 2008 TM Directive, now Article 14 of the 2015 TM

Directive) sets out certain restrictions and limitations to ensure

certain “descriptive” uses of a mark or term may not amount to an

infringement, or where use of a mark or term is necessary to

indicate spare parts, compatibility, or intended use of a product or

service, all of which might otherwise have the effect of limiting fair

competition and improperly expanding the scope of protection of a

trademark proprietor. Such defenses are not absolute, but apply

only where such use is in accordance with “honest practices” in the

relevant context.

The closely related subject of the use of a third-party trademark

in comparative advertising has been a familiar battle ground

between leading brands and their competitors in the EU. Note that

infringement by comparative advertising is now expressly called out

as an act of infringement in the “new” legislation if such use is

contrary to the Comparative Advertising Directive (Directive

2006/114/EC) (see now Article 10 of the 2015 TM Directive and

Article 9(3)(f) of the 2017 EUTM Regulation). In this Part VII, the

Irish Supreme Court considered the interaction between trademark

infringement and a defense under the Comparative Advertising

Directive in the culmination of years of litigation in the Aldi v.

Dunnes Stores case, underlining the policy basis for comparative

advertising and in doing so the intersection in this regard between

competition (antitrust) law and trademark law.

This interaction between competition and trademark law also

forms the basis for the remainder of cases considered in this Part

VII. This year featured cases before EU national courts that

considered whether a trademark proprietor’s rights that that

ordinarily be “exhausted” from a first (legitimate) sale in the EU

might still be exercisable in circumstances such as the use of a third-

party trademark on a retailer’s packaging, potential damage to the

aura of luxury goods from the mode of presentation or sale

environment and whether online sales might similarly affect the

prestige and image of “luxury” goods.

610 Vol. 110 TMR

B. Legal Texts

Article 14 of the 2017 EUTM Regulation

1. An EU trade mark shall not entitle the proprietor to

prohibit a third party from using, in the course of trade:

(a) the name or address of the third party, where that

third party is a natural person;

(b) signs or indications which are not distinctive or which

concern the kind, quality, quantity, intended purpose,

value, geographical origin, the time of production of

goods or of rendering of the service, or other

characteristics of the goods or services;

referring to goods or services as those of the

proprietor of that trade mark, in particular, where the

use of that trade mark is necessary to indicate the

intended purpose of a product or service, in particular

as accessories or spare parts.

2. Paragraph 1 shall only apply where the use made by the

third party is in accordance with honest practices in

industrial or commercial matters.

(Note: In the new EUTM, the “own name” defense, now

contained in Article 14(1)(a), has been confined to natural

persons—having previously had no such limitation. The

defense for signs or indications that are “not distinctive” is

also new, and the wording now contained in Article 14(1)(c)

has been broadened.)

Article 15 of the 2017 EUTM Regulation

1. An EU trade mark shall not entitle the proprietor to

prohibit its use in relation to goods which have been put

on the market in the Union under that trade mark by the

proprietor or with his consent.

2. Paragraph 1 shall not apply where there exist legitimate

reasons for the proprietor to oppose further

commercialisation of the goods, especially where the

condition of the goods is changed or impaired after they

have been put on the market.

Article 6 of the 2008 TM Directive

1. The trade mark shall not entitle the proprietor to prohibit

a third party from using, in the course of trade:

(a) his own name or address;

Vol. 110 TMR 611

(b) indications concerning the kind, quality, quantity,

intended purpose, value, geographical origin, the

time of production of goods or of rendering of the

service, or other characteristics of goods or services;

intended purpose of a product or service, in particular

as accessories or spare parts;

provided he uses them in accordance with honest

practices in industrial or commercial matters.

2. The trade mark shall not entitle the proprietor to prohibit

a third party from using, in the course of trade, an earlier

right which only applies in a particular locality if that

right is recognized by the laws of the Member State in

question and within the limits of the territory in which it

is recognized.

Article 7 of the 2008 TM Directive

1. The trade mark shall not entitle the proprietor to prohibit

its use in relation to goods which have been put on the

market in the Union under that trade mark by the

proprietor or with his consent. Paragraph 1 shall not

apply where there exist legitimate reasons for the

proprietor to oppose further commercialisation of the

goods, especially where the condition of the goods is

changed or impaired after they have been put on the

market.

Article 14 of the 2015 TM Directive

Limitation of the effects of a trademark

1. A trade mark shall not entitle the proprietor to prohibit

a third party from using, in the course of trade:

(a) the name or address of the third party, where that

third party is a natural person;

(b) signs or indications which are not distinctive or which

concern the kind, quality, quantity, intended purpose,

value, geographical origin, the time of production of

goods or of rendering of the service, or other

characteristics of goods or services;

referring to goods or services as those of the

proprietor of that trade mark, in particular, where the

use of the trade mark is necessary to indicate the

intended purpose of a product or service, in particular

as accessories or spare parts.

612 Vol. 110 TMR

2. Paragraph 1 shall only apply where the use made by the

third party is in accordance with honest practices in

industrial or commercial matters.

3. A trade mark shall not entitle the proprietor to prohibit

a third party from using, in the course of trade, an earlier

right which only applies in a particular locality, if that

right is recognised by the law of the Member State in

question and the use of that right is within the limits of

the territory in which it is recognized.

Article 15 of the 2015 TM Directive

Exclusion of rights conferred by a trademark

1. A trade mark shall not entitle the proprietor to prohibit

its use in relation to goods which have been put on the

market in the Union under that trade mark by the

proprietor or with the proprietor's consent.

2. Paragraph 1 shall not apply where there exist legitimate

reasons for the proprietor to oppose further

commercialisation of the goods, especially where the

condition of the goods is changed or impaired after they

have been put on the market.

C. Cases

1. Austria—Austrian Supreme Court—

Does exhaustion prevent a trademark owner

from objecting to the use of their trademarks

on a retailer’s packaging?

The decision of the Austrian Supreme Court in OGH

175

bears a

close resemblance to the June 28, 2018, decision of the Federal

Supreme Court of Germany in Beauty for Less, reported in last

year’s Review.

176

As in Germany, the Supreme Court of Austria held

that exhaustion of trademark rights prevented a trademark

proprietor (or its licensee) from objecting to the use of trademarks

on shipping cartons used by an online retailer to despatch goods to

its customers.

The plaintiff is the manufacturer and distributor of a range of

branded perfume products, which it markets on the basis of license

agreements including, among others, a license of the Austrian word

mark BOSS and the EUTMs BOSS and JOOP! in respect of

175

OGH 22.08.2019, 4 Ob 127/19 h.

176

Case No. I ZR 221/16 (Beauty for Less) (Federal Supreme Court, June 28, 2018). For

commentary on this case, see Tom Scourfield, Annual Review of EU Trademark Law:

2018 in Review, 109 TMR 441, 573 (2019).

Vol. 110 TMR 613

perfumes, aftershave, and other fragrance products. The defendant

operated an online shop for perfume and cosmetic products and had,

until July 2018, offered genuine BOSS and JOOP! products to

consumers among the store inventory. The trademarks BOSS and

JOOP! were placed on the shipping cartons of the retailer alongside

other brand names, and the advertising slogan “BEAUTY FOR

LESS” and the discount label “easyCOSMETIC.”

It was accepted that some of the goods delivered to purchasers

in these containers contained BOSS- and JOOP!-branded goods, but

that many did not.

The plaintiff sought to prevent the defendant’s use of such

packaging, and in particular was concerned that licensed

trademarks were being reproduced alongside other third-party

trademarks and accompanied by the slogan “BEAUTY FOR LESS”

or the designation “easyCOSMETIC.” The plaintiff argued that the

principle of exhaustion did not prevent the trademark proprietor (or

its licensee) objecting to this type of activity because use of the

trademarks in question adversely affected its legitimate interests

by being used in a manner that was not in keeping with the image

of the trademarks as luxury brands. The defendant’s business

practice also falsely suggested a business relationship between the

parties and was not in accordance with honest practices in trade and

commerce.

The defendant argued that it had sold only original, unaltered

goods. The advertising on the boxes referred to goods offered in its

online shop, including products bearing the trademarks in question.

Such advertisements were permitted on packaging and were

necessary because customers often place further orders even after

receiving ordered goods. The proximity of the licensed trademarks

to the terms “BEAUTY FOR LESS” and “easyCOSMETIC” was not

detrimental to the plaintiffs’ trademarks and the mere mention of a

614 Vol. 110 TMR

number of brands on the shipping carton was not sufficient for

customers to assume a business relationship.

The plaintiffs were successful at first instance. This finding was

overturned on (first) appeal, with the Court ruling that the

defendant’s product-related advertising on the shipping carton was

a lawful use of the trademarks and did not infringe any legitimate

interest of the plaintiff.

On further appeal, this approach was confirmed by the Austrian

Supreme Court, in an assessment similar to the approach of the

Federal Supreme Court of Germany in Beauty for Less. The

Austrian Supreme Court confirmed that the exhaustion of

trademark rights prevented the proprietor from seeking to prohibit

the further commercialization by third parties of the original

unaltered product where specific goods bearing the trademark have

been put on the market in the EEA by him or with his consent.

As previously confirmed by the CJEU,

177

further

commercialization can include the right to use a third-party

trademark for advertising purposes. A reseller who sells goods

under a third-party trademark cannot explain this fact to his

customers without using the trademark in question. In the view of

the Austrian Supreme Court, the Court of Second Instance

reasonably concluded that the presence of a large number of

trademarks of different manufacturers used on a retailer’s shipping

carton was not misleading. In addition, a reseller using advertising

practices customary in that sector of trade who habitually markets

articles of the same kind (even though not necessarily all of the

same quality) does not constitute trademark infringement. That

remained the case even where the owner of the trademarks would

not itself use such modes of advertising. Trademark infringement

will only arise where it can be demonstrated that the actual use of

the trademark in the reseller’s advertising is seriously detrimental

to the reputation of the trademark in the specific case (consistent

with the CJEU in Parfums Christian Dior

178

2. Ireland—Irish Supreme Court—What is the limit of

the comparative advertising defense to

trademark infringement?

The decision of the Supreme Court of Ireland in Aldi v. Dunnes

Stores

179

concludes the long-running litigation between two well-

known supermarket operators. The case concerned the proper test

for comparative advertising in respect of the Irish implementation

177

CJEU in Dior, Case C-337/95 para. 36; ECJ in BMW, Case C-63/97 para. 48.

178

CJEU in Dior, Case C-337/95, para. 47.

179

Aldi Stores (Ireland) Limited and Aldi GmbH & Co KG and Dunnes Stores, [2019] IESC

41, Supreme Court, decision by O’Donnell J.

Vol. 110 TMR 615

of the EU Misleading and Comparative Advertising Directive

2006/114/EC (the “CAD”) and of Directive 2005/29/EC (the “Unfair

Commercial Practices Directive”).

Both parties to the legal dispute are leading supermarket chains

in Ireland. In or around June 2013 Aldi became aware that Dunnes

Stores had launched a price comparison campaign concerning

various household products offered for sale in both stores. However,

Aldi’s reputation is as a “discounter” stocking a more limited range

of around 1,350 products, whereas Dunnes (as a more full-service

offering) stocked approximately 18,000 products. Aldi claimed that

the nationwide campaign, which included point of sale advertising,

failed to comply with comparative advertising legislation and

infringed its trademarks. The matter was commenced in the Irish

Commercial High Court on June 9, 2015. The High Court decision

was subsequently reversed in a judgment of the Court of Appeal

delivered on April 6, 2017.

The promotions that were subject of the proceedings were the

following:

1. Shelf-edge labels/specific comparative labels (“SCLs”) in

which Dunnes drew comparisons with Aldi products and

included the term “Aldi match”;

2. Banners and “toblerones” (banners in a free-standing

display) including the slogans “lower price guarantee” and

“guaranteed lower prices on all your family essentials every

week”; and

3. Shelf-edge labels (“SELs”), which included the slogans

“lower price guarantee” and “always better value” plus “Aldi

match.”

Legal framework in Ireland

The CAD was implemented into Irish law by the European

Communities (Misleading and Comparative Advertising)

Regulations 2007 (the “2007 Regulation”). The Unfair Commercial

Practices Directive was implemented into Irish law by the

Consumer Protection Act 2007 (the “2007 Act”). Article 4(a) of the

CAD provides that comparative advertising is permitted as long as

it is not misleading within the meaning of Article 2(b), 3 and 8(1) of

the CAD or Articles 6 and 7 of the Unfair Commercial Practices

Directive. The equivalent provision in the 2007 Regulation is

Regulation 4(2):

A comparative marketing communication is prohibited if, as

regards the comparison—

(a) it is misleading under Regulation 3,

616 Vol. 110 TMR

(b) it is a misleading commercial practice under any of

sections 43 to 46 of the Consumer Protection Act 2007

(No. 19 of 2007),

intended for the same purpose,

(d) it does not objectively compare one or more material,

relevant, verifiable, and representative features of those

products, which may include price,

(e) it discredits or denigrates the trade marks, trade names,

other distinguishing marks, products, activities, or

circumstances of a competitor,

(f) for products with designation of origin, it does not relate

in each case to products with the same designation,

(g) it takes unfair advantage of the reputation of a trade

mark, trade name or other distinguishing marks of a

competitor or of the designation of origin of competing

products,

(h) it presents goods or services as imitations or replicas of

goods or services bearing a protected trade mark or

trade name, or

(i) it creates confusion among traders—

(ii) between the trader who made the comparative

marketing communication and a competitor or,

(iii) between the trade marks, trade names, other

distinguishing marks, goods or services of the

trader who made the comparative marketing

communication and those of a competitor.

The Supreme Court noted that much of the difficulty in the

present case arose from the lack of a specific definition of misleading

comparative advertising for the purposes of Article 4 of the 2006

Directive. This is particularly problematic where the issue

complained of is not that the advertising is misleading in general

terms under both Directives, but that the advertising is misleading

by the fact of the comparison that is made.

The second issue identified by the Supreme Court lies in the

separate definitions of misleading advertising referred to in Article

4(a) of the CAD and Articles 6 and 7 of the Unfair Commercial

Practices Directive.

Articles 6 and 7 of the Unfair Commercial Practices Directive

are implemented into Irish law by Section 43 of the 2007 Act, which

deals with the provision of false, misleading, or deceptive

information, and Section 46 of the 2007 Act, which deals with

withholding, omission, or concealment of material information. The

Court observed that the 2007 Act is drafted to prevent misleading

commercial practices in the context of providing or withholding

Vol. 110 TMR 617

misleading information and not merely misleading advertising in

the context of comparative advertising.

Section 14(6) of the Irish Trade Mark Act 1996 permits use of a

trademark provided that the use is in accordance with honest

commercial practices and does not take unfair advantage of or is not

detrimental to the reputation of the mark. It was clear that if the

advertisements in the current case were examples of impermissible

comparative advertising, then there would be an infringement of

Aldi’s trademarks.

The High Court’s decision

In June 2015, Cregan J delivered a 141-page judgment

180

in the

High Court that dealt in great detail with an analysis of the

products promoted in the SCLs. The judge accepted the evidence

adduced by Aldi’s expert in comparative labelling, which compared

five key criteria of quantity, provenance, nature, substance, and

quality. By way of example, he found that there was a significant

difference between the turkey mince offered by both retailers, as

Aldi’s turkey breast mince was endorsed by the Irish food agency

Bord Bia—a mark of provenance—and Dunne’s product was not. He

examined the characterizing ingredient of each product and

accepted that a difference of more than ten percent was a reasonable

threshold in assessing whether the difference was material,

relevant, or representative of the product. In relation to Regulation

(2)(d) of the 2007 Regulation, the judge was swayed by the analysis

of the difference between the products in terms of their composition

and ingredients in determining whether the SCLs met the objective

comparison grounded in Regulation 4(2)(d). He concluded that

fourteen of the fifteen SCLs failed to satisfy the criteria set out in

Regulation 4(2)(d), as these SCLs failed to objectively compare the

products.

In his examination of the SCLs under Regulation 4(2)(c) of the

2007 Regulation, Cregan J accepted that the compared products

broadly met the same needs or were intended for the same purposes

as set out in Regulation 4(2)(c). However, he considered the fact that

the Dunne’s SCLs referred to an Aldi product identified only by price

meant that the SCLs did not actually correctly compare products

under Regulation 4(2)(c).

In establishing whether the SCLs breached Regulation 4(2)(b) of

the 2007 Regulation, Cregan J relied on the same analysis carried

out in respect of Regulation 4(2)(d). He concluded that the Dunnes

advertisements either gave false information or omitted or

concealed material information in relation to fourteen out of the

fifteen products used in the SCLs.

180

[2015] IEHC 495.

618 Vol. 110 TMR

Adopting the same formula, Cregan J found that the banners

and “toblerones” and SELs contravened Regulation 4(2)(d), 4(2)(c),

and 4(2)(b) of the 2007 Regulation. Dunnes did not dispute the

decision with respect to the banners.

The Court of Appeal’s decision

Dunnes appealed and the Court of Appeal

181

overturned the

High Court’s finding on the basis that it had applied an incorrect

test in concluding that the SCLs and SELs were contrary to

comparative advertising law. In rejecting the trial judge’s approach

to the interpretation of Regulation 4(2)(d), the Court held that it was

only necessary that the advertisement compared the products in one

or more objective respects, not in every material respect. The Court

also rejected Cregan J’s interpretation of Regulation 4(2)(c) as it

held that the products under comparison only needed to be

substitutable and interchangeable, but not identical. Further, it

found that the High Court judge’s reliance on Aldi’s expert evidence

concerning minute differences in the respective trader’s products

was unwarranted and that this impacted upon the High Court

judge’s findings in relation to Regulations 4(2)(d) and 4(2)(c).

The Court of Appeal also reversed the High Court’s findings in

relation to the SEL’s on the basis that there was no implicit

comparison. However, it found that the comparative advertising on

banners and “toblerones” was impermissible because no comparison

of product prices or any feature of the rival products had been made

within the meaning of the 2007 Regulation. The Court declined to

order a retrial on a number of grounds, including that the costs

would be disproportionate to the value of the substantive case, a

substantial period of time had elapsed since the conduct at issue

occurred, and that new evidence would need to be heard, making

the case wholly different.

Aldi appealed in relation to the Court of Appeal’s findings

concerning SELs and SCLs, but not with respect to the banners.

The Supreme Court’s decision

In giving a decision on behalf of the Supreme Court, O’Donnell

J underlined the policy basis for comparative advertising and in

doing so the intersection in this regard between competition law and

trademark law. He noted that while EU law principles mandate that

courts take a broad view of comparative advertising, a failure to

comply with the regime could result in a finding of trademark

infringement.

The judge referred to the added layer of confusion arising from

the overlay of misleading advertising from the CAD and its

181

[2017] IECA 116.

Vol. 110 TMR 619

incorporation into Regulation 4(2). He noted that the resulting

difficulties in determining what is (or is not) a prohibited

comparative advertisement might have been averted by the

inclusion of a specific definition of comparative advertising;

however, despite this lacuna, he managed to interpret the regime in

the specific context of this case based upon established principles.

Referring to the CJEU’s decision in Lidl SNC v. Vierzon

Distribution SA,

182

O’Donnell J stated that it was for national courts

to establish whether a particular advertisement was misleading or

not under Article 4(2)(b) of the 2007 Regulations. The Court followed

the approach recommended by Lewison L.J. in the UK Court of

Appeal case of Marks and Spencer PLC v. Interflora Inc.,

183

that this

kind of analysis can be done in the case of commonly advertised

consumer products by a judge alone, without extensive expert

evidence. The overall test requires the judge to consider whether the

advertising satisfies Regulations 4(2)(c) to (i) of the 2007

Regulations and then form a sensible and pragmatic judgement as

to compliance with Regulation 4(2)(b). This analysis is all to be

approached on the basis that courts recognize that advertisements

will naturally present products in order to highlight their most

attractive features, that most transactions are carried out without

minute or microscopic examination by consumers, and that the test

involves an assessment as to whether the consumer is somehow

deceived in the circumstances, whether positively or by omission.

Where products have acknowledged differences, this translates to

considering whether the products are comparable and when

objectively compared at least in one respect (normally as to price)

the comparison is misleading in the sense that there is a false

implication of other features of the product that operates so as to

deceive the customer and significantly affect their purchasing

decision.

The Supreme Court’s conclusion in respect of the SCLs

O’Donnell J. found that the High Court had been in error in

considering that the analysis of composition and ingredients in

products was relevant to whether the advertisement satisfied

Regulation 4(2)(d) of the 2007 Regulations and that the Court of

Appeal had correctly identified that all that was required was the

comparison of one material, relevant, verifiable, and representative

feature of the goods and that the comparison was objective. In this

case the Court found that the relevant comparator was price and

that this was appropriately made in relation to all of the SCL’s with

the exception of two, namely toilet tissue and day cream. The Court

held that minor compositional differences of all but these last two

182

Case C-159/09.

183

[2012] EWCA Civ. 1501.

620 Vol. 110 TMR

products were not material and in this regard the Supreme Court

referred to CJEU guidance in the Lidl v. Vierzon case stating: “A

practice will be misleading by omission if it omits material

information the average consumer needs, in the context, to take an

informed transactional decision and thereby is likely to cause the

average consumer to take transactional decisions he or she would

not otherwise have taken.”

Accordingly, the Court found that the length of toilet paper was

a “material feature” and that the implication that the products were

substitutable in relation to products of significantly different length

was false and breached Regulation 4(2)(b). The Court also found

that the SCL in respect of the day cream breached Regulation 4(2)(b)

on the basis that a consumer might be falsely misled into thinking

that Dunnes cream also contained an SPF like the Aldi product

when this was not the case.

The Supreme Court agreed with the decision of the appellate

court, that the slogans were not misleading within the meaning of

Regulation 4(2)(b). It considered that even under pressure, the

average consumer would not treat vague slogans as overriding

specific price information.

Relief for infringement of Aldi’s trademarks

The Supreme Court examined whether the Court of Appeal was

correct in refusing to grant an injunction in relation to the banners

and “toblerones” against Dunnes, even though it had breached Aldi’s

trademarks in that regard. This was also a relevant consideration

in relation to the Supreme Court’s finding of two instances of breach

of Regulation 4(2)(b).

The Court noted that Aldi had already had the benefit of an

injunction in relation to all of the products for some years and

Dunnes could never be compensated for what now must be

considered an excessive restraint. Moreover, there was no indication

that Dunnes threatened to repeat its campaign and it was unlikely

in all the circumstances of this judgment that Dunnes would

reproduce the offending banners and the two SCLs. Therefore, the

Supreme Court held that that this case could be classified as an

exceptional circumstance within the meaning of Article 102(1) of the

2009 EUTM Regulation in which injunctive relief would not be

granted.

Vol. 110 TMR 621

3. Germany—Court of Appeal of Munich—

Exhaustion of trademark rights—damage to

aura of luxury may arise in presentation or

mode of distribution

In a decision rendered on November 8, 2018 (but not published

until June 2019), the Munich Court of Appeal

184

held that the

doctrine of exhaustion would prevent a trademark owner objecting

to the sale of goods by unauthorized dealers unless the trademark

owner was able explain how such sales could damage the reputation

of the brand.

The plaintiff was a manufacturer of luxury skin care cosmetics,

distributing its products through a system of pre-selected specialist

retailers. The defendant operated shops in which a variety of

products were offered, including in particular fashion articles and

home accessories. The defendant’s core business concept was the

sale of original branded products from reputed manufacturers

(including luxury brand owners) obtained from leftover inventory,

liquidated stock or insolvent enterprises. The products were

typically in limited quantities and sold at significant discount to the

usual price of such goods in short terms sales campaigns.

The defendant had obtained inventory of the plaintiff’s SISLEY-

branded luxury cosmetics, presented for sale in store in additional

transparent wrappers with security labels.

184

Case No. 29 U 700/17 (SISLEY).

622 Vol. 110 TMR

(source: court decision)

Products of other manufacturers were presented in the other

parts of the shelf and offered with a “SALE” label and red stickers

indicating low prices.

(source: court decision)

Vol. 110 TMR 623

The plaintiff sued for trademark infringement arising from such

sales. The defendant argued that the trademark rights had been

exhausted when the products were placed on the market by the

plaintiff and as such their further commercialization could not be

prevented. At first instance the District Court found in favor of the

defendant and dismissed the claim for trademark infringement.

The Court of Appeal confirmed the decision of the District Court.

It considered the rules applicable to exhaustion, as set out in Section

24 (1) and Section 24 (2) of the German Trademark Act (equivalent

to Article 7 of the 2008 TM Directive, and Article 15 of the 2015 TM

Directive) and, in particular, whether the condition of the goods had

changed or been impaired after they had been put on the market.

Section 24 German Trademark Act reads (as translated):

§ 24

Exhaustion

1. The proprietor of a trade mark . . . shall not be entitled

to prohibit a third party from using the trade mark . . .

for goods which have been put on the market under this

trade mark . . . by him or with his consent in Germany,

in one of the other Member States of the European

Union or in another Contracting Party to the Agreement

on the European Economic Area.

2. Subsection (1) shall not apply if the proprietor of the

trade mark . . . opposes the use of the trade mark . . . in

connection with the further commercialization of the

goods for legitimate reasons, in particular if the

condition of the goods has been changed or impaired

after being put on the market.

The Court of Appeal considered that it was implicit in

Section 24(2) of the German Trademark Act that a right to object

would not only apply where the physical condition of the goods had

been affected, but also where the form of distribution itself could

damage the reputation of the trademark. This apparent extension

of the applicability of Section 24(2) of the German Trademark Act

had also been made by the Düsseldorf Court of Appeal on March 6,

2018,

185

and by the Hamburg Court of Appeal on June 21, 2018.

186

However, the Munich Court of Appeal held that none of the facts

cited by the plaintiff would be sufficient to establish damage to the

reputation of the trademark, including the “discount atmosphere” of

the defendant’s stores, the particular plastic wrapper packaging,

the product presentation, and proximity to other products on “sale,”

185

Case No. I-20 U 113/17. (See Tom Scourfield, Annual Review of EU Trademark Law:

2018 in Review, 109 TMR 441, 567 (2019).)

186

Case No. U 151/17.

624 Vol. 110 TMR

nor the lack of trained staff able to offer product consultation and

help with selection.

In the Court’s view, the mere fact that a discounter is selling

luxury goods in a manner common to many discount retailers is not

detrimental to the reputation of a brand because the public is used

to finding premium cosmetic or perfumery products in the stores of

both “typical” discounters and big retail chains. A similar conclusion

was reached in respect of product presentation. Although such

presentation would not be found in the plaintiff’s “official”

distribution partners, the SISLEY-branded products were not

presented together with “cheap” products on the same shelf

segment, but presented separately in a way that consumers might

be expected to realize that these products were something “special”

in comparison to the other products.

In respect of the plastic wrappers, these served a legitimate

purpose of making theft more difficult and such additional steps

merely highlighted the fact that the products played a special role

in the defendant’s overall product offering. As for a lack of trained

staff who were able to offer consultation, it was relevant that Sisley

products were also offered in big department stores (also without

trained staff), and on the Internet where there is no consultation at

all. As such a lack of trained staff would be attributed to the store

but would not reflect poorly upon the product.

Overall, the Court considered that customers would recognize

that the products in question enjoyed a special presentation in

comparison to the other products, which only served to emphasize

their quality and special status, rather than lead to a detriment of

the ‘Sisley’ brand and reputation. This could also be distinguished

from other cases where damage was established, because on these

facts there was no permanent or substantial sale of the premium

products by the discounter, so the customer was likely to consider

the offering as a short term special opportunity to buy a premium

product for a low price, offering a customers a chance to pick up a

bargain that did not downgrade the brand. The difficulties

encountered by the plaintiff in the case serves to highlight that the

burden of proof falls on the plaintiff to establish an exception to the

exhaustion rules which are construed narrowly and which require

evidence of actual or perceived harm arising from sales and the

presentation of products. The decision has been further appealed to

the German Supreme Court.

Vol. 110 TMR 625

4. Italy—Court of Milan—Parallel Trade—

Does the existence of a selective distribution

network amount to a “legitimate reason”

to preclude exhaustion of trademark rights?

In Sisley v. Amazon

187

the Court of Milan heard the appeal

proceedings in respect of an application for interim relief brought

against the well-known online retailer Amazon by luxury cosmetics

brand Sisley.

Article 15(2) of the 2017 EUTM Regulation provides:

1. An EU trademark shall not entitle the proprietor to

prohibit its use in relation to goods which have been put

on the market in the European Economic Area under

that trade mark by the proprietor or with his consent.

2. Paragraph 1 shall not apply where there exist legitimate

reasons for the proprietor to oppose further

commercialisation of the goods, especially where the

condition of the goods is changed or impaired after they

have been put on the market).

Sisley operate a selective distribution network, which restricted

the outlets in which their branded products could be sold. In 2018

Sisley had filed injunctive proceedings against Amazon before the

Court of Milan, claiming, inter alia, trademark infringement in

connection with Internet sales of products bearing the SISLEY

mark outside Sisley’s selective distribution network—specifically on

Amazon’s online store, both in respect of “direct” sales by Amazon,

and by third parties selling on Amazon’s platform.

In the first stage of the proceedings, the Court of Milan

dismissed Sisley’s petition on the ground that Sisley’s selective

distribution network was not valid under EU competition law. This

was because in the relevant distribution agreement there was a

provision that the Court read as a restriction on “cross-supplies”

among authorized distributors, which in the Court’s view went

“beyond the licit intention of safeguarding the quality and luxury

image of the trademark owner’s products” and was “not

instrumental and proportional to accomplishing these qualitative

objectives.”

Sisley subsequently filed an appeal against this decision,

stressing that in the meantime it had amended its distribution

agreement expressly allowing cross-supplies among authorized

distributors. In light of this amendment, the Court found Sisley’s

selective distribution network was now valid under EU competition

law and proceeded to analyze the case under trademark law.

187

July 3, 2019, No. 50977/2018, Sisley Italia S.r.l., Socie ́te ́ C.F.E.B. Sisley, Socie ́te ́

d’Investissement et de License v. Amazon Europe Core S.a.r.l., Amazon Eu S.a.r.l.,

Amazon Services Europe S.a.r.l.

626 Vol. 110 TMR

The Court of Milan held that the existence of a selective

distribution network could indeed fall within the “legitimate

reasons” precluding the exhaustion of trademark rights, provided

that: (i) the relevant products are luxury or prestigious goods that

justify the implementation of a selective distribution network; and

(ii) there is actual detriment to the relevant trademark’s luxury and

prestigious image arising from the commercialization carried out by

third parties outside that selective distribution network. The Court

held that whenever those conditions are met, a trademark owner

may oppose further commercialization of its products by third

parties outside its selective distribution network, even though they

purchased such products from licensees or authorized distributors.

In particular, with specific regard to the second condition, the

Court of Milan pointed out that it is necessary to assess on a case-

by-case basis whether the licensee’s or authorized distributor’s sales

of products to third parties outside the selective distribution

network and the further commercialization of such products may

give rise to actual detriment to the mark. The criteria for such

detriment would include: (i) the nature of the products

distinguished by the mark; (ii) the volume and systematic or

occasional nature of the sales by the licensee to resellers outside the

selective distribution network; and (iii) the nature of the products

usually commercialized by these resellers and the usual means of

marketing used.

Having established the relevant principles, the Court went on to

consider whether two conditions were met on the facts of the case,

being whether (i) Sisley’s relevant products could be considered

luxury goods; and (ii) the Internet sales of said products through

Amazon’s online platform would cause an actual detriment to the

luxury/prestige image of the mark SISLEY.

First, the Court found that the luxury nature of Sisley’s products

was undisputed and therefore the adoption of a selective

distribution network was justified. Second, after looking at the

usual sales method of products on Amazon’s platform, the Court

found detriment to the prestige and image of the SISLEY mark

arising from: (a) the marketing, offering for sale, promotion, and

advertising of Sisley’s products along with advertising material of

products belonging to other brands, also of lower market segments,

on the same Internet page; (b) the juxtaposition of Sisley’s products

with products that were not luxury goods, as well as the presence of

links pointing to websites of products completely different from

Sisley’s; and (c) the lack of an adequate customer service experience,

similar to that guaranteed by the presence in the physical store of a

person able to adequately advise or inform consumers.

In light of the above, the Court established that Sisley had a

“legitimate reason” to oppose further commercialization of its

Vol. 110 TMR 627

products on the part of Amazon under Article 5.2 of the Italian

Intellectual Property Code (equivalent to Article 15.2 EUTMR).

The approach followed by the Court of Milan may in some

respects seem rather more strict than the approach of the CJEU in

Coty,

188

insofar as the “Italian approach” requires an assessment on

a case-by-case basis of whether Internet sales outside the selective

distribution network are carried out in a way that are capable of

causing actual detriment to the luxury/prestigious image of the

relevant trademark. By contrast, in Coty the CJEU seemed to open

the door to a more flexible approach by finding that harm arose from

the mere fact of sales over the Internet—see in particular paragraph

49 of that judgment where the CJEU held that:

The internet sale of luxury goods via platforms which do not

belong to the selective distribution system for those goods, in

the context of which the supplier is unable to check the

conditions in which those goods are sold, involves a risk of

deterioration of the online presentation of those goods which

is liable to harm their luxury image and thus their very

character.

VIII. GEOGRAPHICAL INDICATIONS

A. Introductory Comments

This Part VIII concerns geographical indications (“GIs”),

registered in accordance with Article 16 of Regulation No. 110/2008,

which protect the source of goods as originating from a particular

territory, region, or locality where the quality, reputation, or other

characteristics of the goods are attributable to the goods’

geographical origin.

In addition to GIs, Article 7(1) of the 2017 EUTM Regulation

now also provides (unlike its predecessor) for absolute grounds of

refusal by reference to traditional terms for wine, to traditional

specialities guaranteed (“TSGs”), and to plant variety rights,

(similar provisions are contained in the 2015 TM Directive, where

the absolute grounds for refusal are contained in Article 4, (the new

provisions are set out in Article 4(1)(i) to 4(1)(l) of the 2015 TM

Directive)). Similarly, the proprietors of such rights are also

provided with rights to oppose trademark applications on the basis

of such rights (Article 8(6) of the 2017 EUTM Regulation and Article

5(c) of the 2015 TM Directive).

Although only one case merits specific inclusion in this year’s

Review, the enforcement of geographical indications of origin

continues to provide an important additional context and

consideration for EU trademark practitioners. Despite ultimately

188

Coty v. Parfümerie Akzente, Case C-230/16, (CJEU, December 6, 2017).

628 Vol. 110 TMR

being unsuccessful in enforcement, the Manchego case (originating

in Spain but referred to the CJEU) confirmed that a registered GI

may also be evoked through the use of figurative signs, potentially

broadening the scope of protection to “conceptual” infringement of

GIs.

B. Legal Texts

Article 7 of the 2017 EUTM Regulation

Absolute grounds for refusal

3. The following shall not be registered:

. . .

(Note: paragraphs (a)–(i) were omitted.)

(j) trade marks which are excluded from registration,

pursuant to Union legislation or national law or to

international agreements to which the Union or the

Member State concerned is party, providing for

protection of designations of origin and geographical

indications;

(k) trade marks which are excluded from registration

pursuant to Union legislation or international

agreements to which the Union is party, providing for

protection of traditional terms for wine;

(l) trade marks which are excluded from registration

pursuant to Union legislation or international

agreements to which the Union is party, providing for

protection of traditional specialities guaranteed;

Article 16(a) to (c) of Regulation (EC) No 110/2008

. . . the geographical indications registered in Annex III shall

be protected against:

(a) any direct or indirect commercial use in respect of

products not covered by the registration in so far as

those products are comparable to the spirit drink

registered under that geographical indication or in so

far as such use exploits the reputation of the

registered geographical indication;

(b) any misuse, imitation or evocation, even if the true

origin of the product is indicated or the geographical

indication is used in translation or accompanied by an

expression such as “like”, “type”, “style”, “made”,

“flavour” or any other similar term;

provenance, origin, nature or essential qualities on

Vol. 110 TMR 629

the description, presentation, or labelling of the

product liable to convey a false impression as to its

origin;

(d) any other practice liable to mislead the consumer as

to the true origin of the product.

Article 8(6) of the 2017 EUTM Regulation

Relative grounds for refusal

6. Upon opposition by any person authorized under the

relevant law to exercise the rights arising from a

designation of origin or a geographical indication, the

trade mark applied for shall not be registered where and

to the extent that, pursuant to the Union legislation or

national law providing for the protection of designations

of origin or geographical indications:

(i) an application for a designation of origin or a

geographical indication had already been

submitted, in accordance with Union legislation

or national law, prior to the date of application

for registration of the EU trade mark or the date

of the priority claimed for the application,

subject to its subsequent registration;

(ii) that designation of origin or geographical

indication confers the right to prohibit the use of

a subsequent trade mark.

Article 5(3)(c) of the 2015 TM Directive

3. The following shall not be registered:

(Note: paragraphs (a)–(b) were omitted.)

or the law of the Member State concerned providing

for protection of designations of origin and

geographical indications:

(i) an application for a designation of origin or a

geographical indication had already been

submitted in accordance with Union legislation

or the law of the Member State concerned prior

to the date of application for registration of the

trade mark or the date of the priority claimed for

the application, subject to its subsequent

registration;

(ii) that designation of origin or geographical

indication confers on the person authorised

under the relevant law to exercise the rights

630 Vol. 110 TMR

arising therefrom the right to prohibit the use of

a subsequent trade mark.

C. Cases

1. Spain—Spanish Supreme Court—

Trademarks and geographical indications—

How far can GI protection go?

The Queso Manchego case,

189

decided by the Supreme Court of

Spain on July 18, 2019, considered the interaction between

geographical indications and trademark law.

The plaintiff (Fundación Consejo Regulador de la Denominación

de Origen Protegida Queso Manchego) is a foundation responsible

for managing the protected designation of origin (“PDO”) of Queso

Manchego, Spain. The foundation’s main functions are to protect

and promote the collective interests of MANCHEGO CHEESE,

including, where necessary, to take legal action against products

that by their presentation or labelling may induce consumers to

believe that such products are Manchego cheese when they do not

qualify as such.

MANCHEGO CHEESE is a PDO, protected in Spain since 1984

and in the EU by Commission Regulation (EC) No. 1107/96. “Queso

Manchego” is a specific kind of sheep cheese made with either

pasteurized or raw milk of ewes of the Manchega breed, giving the

cheese certain characteristics of texture, aroma, and flavor. The

defendant is the Spanish food producer Industrial Quesera

Cuquerella SL (“IQC”). The dispute concerned, among other things,

the use by IQC of labels to identify and market cheeses that do not

qualify as QUESO MANCHEGO, according to the specific

requirements of the PDO, which requires both geographical

provenance and a particular technical product specification, as such.

Article 13.1(b) of Council Regulation No. 2081/92 of 14 July 1992

on the protection of geographical indications and designations of

origin for agricultural products and foodstuffs states that

“Registered names shall be protected against (b) any misuse,

imitation or evocation, even if the true origin of the product is

indicated (. . .).”

The Queso Manchego Foundation filed a combined infringement

and invalidity claim on the basis of EU Regulation No. 2081/92

against IQC, who had been using the names “Super Rocinante,”

“Rocinante,” and “Quesos Rocinante” to designate cheese that did

not qualify for the PDO QUESO MANCHEGO. Although the actual

brand names were dissimilar to the term “Queso Manchego,” IQC’s

use of the name “Rocinante” was to produce an association with Don

189

Case C-614/17, Judgment 451/2019 of the Supreme Court of Spain of July 18, 2019,

cassation appeal 3250/2014.

Vol. 110 TMR 631

Quixote de la Mancha (specifically, “Rocinante” was the name of his

horse) as well as using images of windmills on the packaging of the

cheese, which are typical and evocative of the La Mancha region in

Spain. The Queso Manchego Foundation considered that this would

make consumers believe that they were buying “Manchego” cheese.

Infringing cheese

Typical Don Quixote & La

At first instance, the Commercial Court dismissed the action on

the ground that the signs and names used by IQC to market the

cheeses were not visually or phonetically similar to the PDOs

QUESO MANCHEGO or LA MANCHA and that the use of signs

such as the name “Rocinante” or the image of the literary character

Don Quixote de La Mancha was merely evocative of the region of La

Mancha, Spain, in general, but not specifically the cheese covered

by the PDO QUESO MANCHEGO.

The Queso Manchego Foundation appealed to the Appeal Court

of Albacete, which also rejected the appeal in its judgment of

October 28, 2014. Essentially following the same findings as at first

instance, the Appeal Court considered that the use of the name of

Don Quixote’s horse and of images typical of La Mancha on the

labels of those cheeses could lead consumers to think of the region

of La Mancha, but not necessarily of the cheese covered by the PDO

QUESO MANCHEGO.

The Queso Manchego Foundation subsequently brought an

appeal against that judgment before the Supreme Court of Spain,

who referred the following questions to the CJEU for a preliminary

ruling:

(1) Must the evocation necessarily be brought about by the

use of a name visually, phonetically or conceptually

similar to the [PDO] or may it be brought about by the

use of figurative signs evoking the [PDO]?

(2) Can the use of signs evoking the region with which a

[PDO] is associated constitute evocation of the [PDO]

632 Vol. 110 TMR

itself, even when the user of those signs is a producer

established in the region associated with the [PDO], but

whose products are not protected by [that PDO] because

they do not meet the requirements set out in the product

specification, apart from the geographical provenance?

(3) Must the concept of the average consumer in order to

assess whether there is “evocation”, be understood to

cover European consumers or can it cover only

consumers of the Member State in which the challenged

product is produced or with which the PDO is

geographically associated and in which the product is

mainly consumed?

In its judgment of May 2, 2019, the CJEU replied to the above

questions as follows:

(1) A registered name may be evoked through the use of

figurative signs.

(2) The use of figurative signs evoking the geographical

area with which a designation of origin is associated

may constitute evocation of that designation, including

where such figurative signs are used by a producer

established in that region, but whose products, similar

or comparable to those protected by the designation of

origin, are not covered by it.

(3) The concept of the average consumer who is reasonably

well informed and reasonably observant and

circumspect, to whose perception the national court has

to refer in order to assess whether there is “evocation”

must be understood as covering European consumers,

including consumers of the Member State in which the

product giving rise to evocation of the protected name is

made or with which that name is geographically

associated and in which the product is mainly consumed.

Following the judgment of the CJEU, on July 18, 2019, the

Supreme Court of Spain declared that the use of the name

“Rocinante” and images evoking La Mancha region infringed the

PDO QUESO MANCHEGO. It also cancelled the trademarks

registered in the name of IQC as far as “cheese” was concerned. This

case is the latest in a line of authorities showing the development of

protection for PDOs and other GIs, following Cambozola

190

in which

the CJEU declared that a GI may be infringed if the term used to

designate a product incorporates a similar designation and

subsequently in Glen

191

the CJEU stated that there may also be

evocation as a result of the simple “conceptual proximity” between

190

Case C-87/97.

191

Case C-44/17.

Vol. 110 TMR 633

the GI and the disputed sign. The CJEU’s guidance in Queso

Manchego (Case C-614/17) now confirms that a registered GI may

also be evoked through the use of figurative signs.

IX. PRACTICE AND PROCEDURE

A. Introductory Comments

This final Part IX contains cases that are of more general

interest to brand owners and trademark practitioners, containing

important points of principle or updates on trademark practice and

procedure affecting EUTMs or national trademarks.

The CJEU considered the impact of “disclaimers” in the overall

analysis of comparisons between marks, an important case given

that many national IPOs imposed disclaimers to make clear that the

scope of protection did not include purely descriptive elements of a

trademark. The CJEU confirmed that a disclaimer cannot wholly

exclude an element of a trademark from the global assessment of a

likelihood of confusion, as this would be incompatible with the

requirements of the TM Directive. The General Court once again

considered the discretion of the EUIPO when considering whether

to take into account evidence submitted for the first time before the

Board of Appeal, and to state the reasons on which such decisions

are based, pursuant to Articles 75 and 76 of the 2009 EUTM

Regulation.

Before national courts, German cases considered the

interpretation of trademark-related agreements concluded in the

course of a corporate transaction, using implied terms to give

efficacy to the overall transaction contemplated by the parties. The

German courts also considered the stay of invalidity proceedings

due to insolvency proceedings commenced against the applicant for

invalidity and whether a lack of urgency or ongoing infringement

precluded the grant of an interim injunction. Elsewhere the Spanish

courts considered the appropriateness of a statutory assumption of

damage where a party had admitted to suffering no damage at all,

while the UK courts considered the use of survey evidence to show

attribution of color to trade origin among the relevant class of user

groups. Finally, decisions in Denmark and Sweden examined issues

surrounding the interaction of trademark law and protection for

personal and business names, respectively.

B. Legal Texts

Article 76 of the 2017 EUTM Regulation

Examination of the facts by the Office of its own motion

1. In proceedings before it the Office shall examine the facts

of its own motion; however, in proceedings relating to

634 Vol. 110 TMR

relative grounds for refusal of registration, the Office

shall be restricted in this examination to the facts,

evidence and arguments provided by the parties and the

relief sought.

2. The Office may disregard facts or evidence which are not

submitted in due time by the parties concerned.

C. Cases

1. EU—CJEU—What is the impact of a disclaimer

that has been entered on the register of a trademark

in the global assessment of a likelihood of confusion

with another mark?

The decision of the CJEU in Patent-och regidtreringsverket v.

Mats Hannson

192

concerned a national trademark registration for

the word and figurative sign ROSLAGSPUNSCH for “alcoholic

drinks” in class 33 (the “Earlier Registration”) owned by Norrtelje

Brenneri Aktiebolag’s (“Norrtelje”), a Swedish company. The

figurative sign is reproduced below.

The Earlier Registration is accompanied by a disclaimer that

states “the registration does not give an exclusive right over the

word “ROSLAGSPUNSCH.” The Swedish Patents and Market

Court of Appeal requested a preliminary ruling from the CJEU on

whether Article 4(1)(b) of Directive 2008/95 (assessment of a

likelihood of confusion) may be affected by disclaimers made on

registration. Given that elements of the trademark have been

expressly excluded from protection by means of the disclaimer, what

impact, if any, should such elements have in the global assessment.

In 2007, Norrtelje registered the Earlier Registration. The

Patent and Registration Office in Sweden (the “PRO”) required a

disclaimer to accompany the Earlier Registration since the

192

Case C-705/17.

Vol. 110 TMR 635

trademark included (i) a term that was descriptive of a geographical

region in Sweden, “Roslags,” and (ii) the term “Punsch,” which

describes one of the goods covered by the registration (namely,

alcohol). In December 2015, Mr. Hannson applied to the PRO for a

national registration for the word mark ROSLAGSÖL for “non

alcoholic beverages and beers” in class 32.

Mr. Hansson’s application was rejected by the PRO in July 2016

on the basis of a likelihood of confusion with the Earlier

Registration. Since both marks began with the term “Roslags” and

referred to identical or similar goods, the fact that the marks

contained other words or figurative elements did not reduce the

similarity of the marks, given that the term “Roslags” was a

dominant element of both. Further, the goods relating to both marks

would likely be distributed by the same sales networks to the same

audience.

On appeal to the Swedish Patents and Market Court (the

“PMC”) Mr. Hannson argued that there was no likelihood of

confusion between the marks in question. The PRO had concluded

that from a global assessment of the marks in question the common

element “ROSLAGS” would lead the relevant public to believe that

the goods of the marks in question derived from the same

commercial origin. The PMC disagreed with the PRO’s approach. In

the PMC’s view the purpose of the disclaimer was to clarify that the

exclusive right deriving from registration of the Earlier Registration

did not relate to the terms referred to as such. The common elements

of the marks could not therefore be considered in these

circumstances. The PRO appealed to the Court of Appeal.

The Court of Appeal observed that while the substantive rules

on the protection of national trademarks are in principle

harmonized at EU law, many of the procedural rules, by contrast,

have remained within the jurisdiction of the Member States. With

that in mind, the Court of Appeal considered whether a national

rule allowing disclaimers to be included on registration should be

categorized as a procedural rule, even where the disclaimer has the

effect of changing the basis on which the global assessment of

trademarks is carried out in accordance with Article 4(1)(b) of

Directive 2008/95. In particular, the Court of Appeal noted that the

case law of national courts was not uniform in relation to the effect

of disclaimers.

The Court of Appeal posed the following questions to the CJEU:

1. Should Article 4(1)(b) of Directive 2008/95 be

interpreted to mean that the global assessment of all

relevant factors which is to be made in an assessment of

the likelihood of confusion is affected by the fact that an

element of a trademark has expressly been excluded

from protection by way of a disclaimer being entered on

the register?

636 Vol. 110 TMR

2. If the answer to the first question is yes, will the

disclaimer affect the global assessment in such a way

that the competent authority will only give limited

regard to the element in question, for example by

regarding it as non-distinctive, even if the element

would be distinctive and prominent in the earlier

trademark?

3. If the answer to the first question is yes and the answer

to the second question is no, will the disclaimer affect

the global assessment in any other way?

In considering the Court of Appeal’s questions, the CJEU

emphasized the primary function of a trademark as an indicator of

origin and the importance of a harmonized approach for registration

and equal protection of trademarks in the EU. The 2008 TM

Direction does not contain any obligations on Member States in

relation to disclaimers, nor does it specify the effects of any such

disclaimer on the examination of the likelihood of confusion. Several

Member States do not provide for the possibility of registering signs

as trademarks with disclaimers at all. According to the CJEU,

Member States could, in principle, continue to allow and/or require

disclaimers to be recorded on registration of trademarks, provided

such disclaimers do not impair the effectiveness of the 2008 TM

Direction, specifically the protection given to rights holders of

earlier trademarks against the registration of trademarks likely to

cause confusion on the part of consumers.

Citing its judgement in the SABEL case,

193

the CJEU re-

emphasized that likelihood of confusion between marks must be

appreciated globally, including an analysis of the distinctiveness of

a mark (which determines the scope of protection); the more

distinctive the earlier mark, the greater the likelihood of confusion.

Specifically, the ability of a trademark to identify origin has to be

assessed by looking at the sign as a whole and excluding any one of

its elements could have an effect on the level of protection afforded

to proprietors. The CJEU observed that, in any case, elements of a

mark that are descriptive (whether or not the subject of a

disclaimer), usually have less weight in the determination of

similarity between signs than the elements of greater

distinctiveness.

However, where a trademark is of weak distinctiveness this does

not necessarily exclude a likelihood of confusion, in particular where

the signs and the goods or services covered are similar. Therefore,

excluding these elements would jeopardize the assessment of the

similarity between the marks in question and result in an incorrect

scope of protection (especially given that most Member States do not

allow disclaimers). A global assessment must therefore be based on

193

Case C-251/95 (EU:C:1997:528).

Vol. 110 TMR 637

the overall impression created by the visual, phonetic, or conceptual

similarity between the marks as a whole in order to afford the best

protection to proprietors in accordance with the 2008 TM Direction.

Significantly, the average consumer normally perceives an

entire mark and does not assess distinct, individual details.

Drawing on established case law,

194

the CJEU confirmed that the

existence of a likelihood of confusion depends on the

interdependence of several different elements, including: (i) the

recognition of the trademark on the market; (ii) the distinctiveness

of the earlier trademark; (iii) the association that can be made with

the used or registered mark; and (iv) the degree of similarity

between the trademarks in question and between the goods and

services identified. The interdependence between the relevant

factors reflect the actual perception of the public and the functioning

of a trademark as an indication of origin.

It follows that where a disclaimer excludes an element of a

trademark from the global assessment of a likelihood of confusion

(because of the descriptive or non-distinctive nature of the element),

this would be incompatible with the requirements of Article 4(1)(b)

of the 2008 TM Direction. National legislation that would in effect

exclude an element of the mark from the overall assessment or

attribute limited importance to that element permanently and in

advance was not compatible with EU law. The CJEU emphasized

that the 2008 TM Direction already has sufficient guarantees to

ensure that signs consisting exclusively of descriptive signs or

indications are not registered or are declared invalid. The CJEU

concluded that the proprietor of a trademark cannot claim an

exclusive right in relation to only one element of a trademark,

regardless of whether or not it is referred to in a disclaimer provided

for by national law.

2. EU—General Court—The EUIPO must assess the

merits of the reasons put forward by the party

that has submitted evidence late or for the first time

at the Board of Appeal in order to comply with its

duties to exercise its discretion and state its reasons

when deciding whether to admit the evidence.

The decision of the General Court in Societe des produits Nestlé

v. EUIPO

195

considers the discretion of the EUIPO when considering

194

See Canon, Case C‑39/97 (CJEU, September 29, 1998) (EU:C:1998:442), para. 16; Lloyd

Schuhfabrik Meyer, Case C‑342/97, (CJEU, June 22, 1999) (EU:C:1999:323), para.18;

adidas and adidas Benelux, Case C‑102/07 (CJEU, April 10, 2008), (EU:C:2008:217),

para. 29.

195

Societe des produits Nestlé v. EUIPO, Case T-536/18 (GC, October 10, 2019)

(EU:T:2019:737).

638 Vol. 110 TMR

whether to take into account evidence submitted for the first time

before the Board of Appeal, and to state the reasons on which its

decisions are based, pursuant to Article 75 of the 2009 EUTM

Regulation.

196

The present case is a continuation of the facts covered in the

2018 edition of this Review at Section IX.C.2 with regard to the

decision of the CJEU in EUIPO v. European Food.

197

In European

Food¸ the CJEU held that the General Court had correctly ruled

198

that evidence submitted for the first time before the Fourth Board

of Appeal of the EUIPO did not have to be considered “out of time”

under all circumstances. Accordingly, the CJEU confirmed the

General Court’s annulment of the Fourth Board of Appeal’s decision

to uphold the Cancellation Division’s decision of October 18, 2013,

as a result of its error of law by not taking the evidence into

consideration because of its late submission.

In June 2018, the Second Board of Appeal annulled the

Cancellation Division’s decision of October 18, 2013, to reject

European Food SA’s application for a declaration of invalidity of

Nestlé SA’s registered FITNESS mark. The Second Board of Appeal

subsequently declared the contested mark invalid pursuant to

Articles 7(1)(b) and (c) of the 2009 EUTM Regulation,

199

finding that

the term “FITNESS”:

(1) was descriptive of the health-giving qualities and

characteristics of the goods the mark is registered in respect

of;

(2) was not distinctive, as the relevant public would not

consider the term “FITNESS” as an indication of trade

origin but a purely informative message of the

characteristics of the goods; and

(3) had not acquired any distinctive character as a consequence

of its use as no evidence was submitted of acquired

distinctiveness in any English-speaking Member State of

the EU.

In reaching its decision, the Second Board of Appeal admitted

the evidence that had been submitted by European Food SA that

the Fourth Board of Appeal had not previously taken into

consideration. The Second Board of Appeal observed that, by

following both the CJEU and the General Court’s decisions in

European Food, it subsequently had to take the evidence into

account.

196

This provision is now at Article 94(1) of the 2017 EUTM Regulation.

197

EUIPO v. European Food, Case C-634/16 (CJEU, January 24, 2018) (EU:C:2018:30).

198

European Food v. EUIPO, Case T-476/15 (GC, September 28, 2016) (T:2016:568).

199

This provision is now at Article 7(1)( b) and 7(1)(c) of the 2017 EUTM Regulation.

Vol. 110 TMR 639

Nestlé appealed to the General Court on four grounds. First,

Nestlé submitted that the Second Board of Appeal had incorrectly

applied Article 65(6) of the 2009 EUTM Regulation

200

by misreading

the CJEU’s judgment in European Food to conclude that it was

required to take the evidence submitted late into consideration

when reaching its decision in June 2018. Nestlé claimed under its

second plea that the Second Board of Appeal had incorrectly applied

Article 76(2) of the 2009 EUTM Regulation

201

by (a) considering that

it lacked discretion to consider taking the evidence into account; (b)

not taking due account of all relevant circumstances; and in any

event (c) failing to state the reasons for its decision. Nestlé’s third

and fourth pleas focused on the substantive points of the contested

mark itself, arguing that was not descriptive of the goods at issue

and was, in fact, distinctive.

The General Court deemed it appropriate to deal with the first

and second grounds together. Both grounds were upheld and the

General Court annulled the decision of the Second Board of Appeal.

In reaching its decision, the General Court clarified that the

EUIPO must state the reasons for which its decisions are based and

must exercise its discretion “fully” when adopting a measure. The

General Court observed that the Second Board of Appeal had clearly

come to the conclusion that it must take the evidence at issue into

account as a result of the General Court and CJEU’s decisions in

European Food. However, the General Court clarified that its

finding in European Food merely meant that evidence submitted for

the first time before the Board of Appeal would not necessarily make

it late or inadmissible, which is not the same as a requirement to

take such evidence into consideration.

The General Court reiterated the CJEU’s ruling in European

Food that it was always possible to submit evidence for the first time

before the Board of Appeal where such evidence was intended to

challenge the Cancellation Division’s decision, whereby it is for the

party presenting such evidence to justify its submission. Such

evidence could not be automatically admissible as the Board of

Appeal would still be required to assess the merits of the reasons for

submitting the evidence in order to properly exercise its discretion

under Article 76(2) of the 2009 EUTM Regulation. By automatically

admitting the evidence, the Second Board of Appeal had failed to

exercise its discretion fully and state its reasons for its decision.

The General Court did not rule on the third and fourth grounds

claimed by Nestlé, nor did it rule on whether the evidence at issue

was admissible under the circumstances of the present case. The

General Court highlighted Article 65(2) of the 2009 EUTM

200

This provision is now at Article 72(6) of the 2017 EUTM Regulation.

201

This provision is now at Article 95(2) of the 2017 EUTM Regulation.

640 Vol. 110 TMR

Regulation

202

to emphasize that it is not the duty of the General

Court to put itself in the EUIPO’s place in exercising the EUIPO’s

powers, but to carry out a review of the legality of the EUIPO’s

decisions. It is for the EUIPO to draw the appropriate inference from

the operative part and grounds of the General Court’s judgments.

3. Germany—Federal Supreme Court—

Grant of a license and transfer of a right to terminate

that license by contractual interpretation

The decision of the Federal Supreme Court

203

of October 17,

2019, represents one of the few occasions when a senior federal court

in Germany has considered the interpretation of trademark-related

agreements concluded in the course of a corporate transaction. The

decision confirmed that a license agreement may be established by

implied terms and a purposive interpretation of the relevant

contracts and that the right to terminate such license agreement

may itself be subject to transfer by contractual interpretation. The

case illustrates the willingness of German courts to interpret

complex commercial agreements to give effect to the perceived

economic objective underlying them.

Relevant background

The facts of the case are relatively complex but may be

summarized as relating to a group of companies, formerly active in

beer brewing, which decided to dissolve the group and divest the

brewery business to a spin-off operation.

Part of the group had been an IP holding company that owned

various trademarks for VALENTINS for beer, comprising both

German national trademarks (the “German trademarks”) as well as

EU trademarks and various IR marks (the “foreign trademarks”).

Both the plaintiff and the defendant were companies within the

overall group to be dissolved, each of which had operated breweries

in Germany.

By two agreements of August 25, 2009 (the “August

Agreement”), and December 7, 2009 (the “December Agreement”),

the IP holding company transferred all foreign trademarks to

another company of the group (“the spin-off company”). While in the

August Agreement the IP holding company had transferred all

trademarks, (i.e., both German and Foreign trademarks), the

December Agreement subsequently excluded the German

trademarks from the spin-off.

On December 16, 2009, at a time when the spin-off had not yet

been completed, the defendant acquired that company. The

202

This provision is now at Article 72(2) of the 2017 EUTM Regulation

203

Case No. I ZB 114/17.

Vol. 110 TMR 641

purchase agreement provided for a clause according to which a

separate trilateral transfer agreement was to be executed (to be

signed by the IP holding company, the plaintiff as purchaser and

the defendant). According to this clause the envisaged trilateral

agreement should contain provisions by which:

• the IP holding company would transfer the German

trademarks to the plaintiff prior to the completion of the

spin-off; and

• use restrictions would apply to both the plaintiff and the

defendant with regard to their respective trademark

“territories” (Germany, rest of the world), corresponding non-

attack obligations, obligations for mutual support and

mutual preemptive rights related to each other’s trademarks

would all have to be provided for.

In short, the agreement contemplated a set of delimitation

regulations safeguarding the plaintiff’s and the defendant’s freedom

to operate their business as before but limited to “their” territories.

However, this trilateral agreement did not materialize. Instead, the

spin-off was completed without any trilateral trademark transfer

agreement, so the plaintiff merely acquired the German trademarks

in a bilateral agreement from the spin-off company. This bilateral

agreement did not provide for delimitation regulations as had

originally been envisaged in the trilateral agreement.

Following the divestiture, the defendant continued a range of

commercial operations related to its brewery business in Germany,

where it bottled and labelled VALENTINS beer for export into the

allocated “trademark territory,” namely, markets outside Germany.

The defendant also sold VALENTINS beer to U.S. Military Stores

located on the Ramstein Air Base in Germany, and even sold

VALENTINS beer to a German company, even though such goods

were sold for export by the purchaser, rather than domestic sales.

The plaintiff sued the defendant for infringement of the German

trademarks. The defendant undertook by way of a cease and desist

declaration not to sell VALENTINS beer in Germany (i.e., to the

German company for export) and also accepted the plaintiff’s claim

with regard to the sales to the U.S. Military stores.

The District Court confirmed the plaintiff’s claim to prevent the

defendant’s sales in U.S. Military Stores on the Ramstein Air Base

(which was not disputed by the defendant) but did not find any

further infringement, which had included claims related to the

bottling and labelling in Germany, as well as a demand for further

information and compensation in damages. On the plaintiff’s

appeal, the Court of Appeal of Karlsruhe overturned key aspects of

the judgment and confirmed the plaintiff’s claims in their entirety

(other than denying the claims for information and damages related

to infringing acts of the defendant taking place prior to the

642 Vol. 110 TMR

submission of the plaintiff’s statement of grounds in the appeal

proceeding).

With a further appeal to the Federal Supreme Court, the

defendant requested the restitution of the District Court’s decision

to enable it to continue bottling and labelling VALENTINS beer in

Germany for the purposes of export.

Trademark license implied by contractual interpretation

The Federal Supreme Court confirmed the judgment of the

Court of Appeal. It was not disputed that the plaintiff owned the

trademark rights for Germany and in such circumstances the act of

labelling the beer, even though for export, would in ordinary

circumstances be an infringement of those trademark rights. The

key issue to be determined was whether the defendant may have

been permitted to label the beer with the VALENTINS trademark

in order to allow the defendant to operate his brewery business as it

had been envisaged by the original spin-off plans.

It might be said that the Court of Appeal could have taken the

view that the agreements, to the extent that they had been

concluded, did not provide for an express permission for the

defendant to continue to bottle and label VALENTINS beer in

Germany, so in such circumstances a finding of infringement was

obvious. However, the Court of Appeal instead opted to interpret the

various agreements in a way that reflected the envisaged spin-off

transaction, an approach later endorsed by the Federal Supreme

Court.

The Federal Supreme Court confirmed the Court of Appeal’s

interpretation, that the agreements contained a license in favor of

the defendant. According to the Supreme Court, and consistent with

the Court of Appeal’s approach, a trademark license agreement need

not always be in a regular trademark license agreement. However,

due to the importance of such a license agreement, it would have to

be documented in some way. The absence of such documentation

might create an assumption of no license beyond a simple

permission to use a trademark (such as a waiver of claims for

trademark infringement by using a sign that corresponds to the

protected trademark). However, documentary evidence supporting

the conclusion of a license agreement can also be inferred by way of

a supplementary interpretation of the agreement. In this case, the

December Agreement by which the German trademark had been

excluded from the spin-off was a written agreement that formed the

basis of a supplementary interpretation of a license agreement.

The Federal Supreme Court pointed out that the precondition

for a supplementary interpretation of the agreement is a “loophole”

within the agreement, requiring an interpretation to reflect the

intention of the parties and implement the business sense of the

transaction that the parties had otherwise overlooked. A

Vol. 110 TMR 643

supplementary interpretation is also possible if the parties have

deliberately omitted a provision but have assumed that this

provision will still be made (an assumption that subsequently turns

out to be incorrect).

With such analysis in mind, the Federal Supreme Court took the

view that the Court of Appeal correctly stated that the three

agreements were based on the intention that VALENTINS beer

could still be manufactured at the defendant’s German production

site, provided it was strictly for export only. Such an arrangement

would have required some form of authorization to use the plaintiff’s

German trademarks, which was not expressly provided for.

The Court of Appeal’s assessment that a constructive

interpretation of the agreement was necessary to give effect to the

commercial intention of the parties did not contain any errors of law.

Account had been taken of the plaintiff’s argument that it was still

possible to produce beer in Germany and to transfer the bottling and

labelling abroad without difficulty, but the Court of Appeal

considered that such an approach did not correspond to the interests

of the parties to the agreement. The sale of the company as intended

could succeed only if the transferred trademark rights allowed the

continuation of production and bottling for export in Germany. The

spin-off company had therefore granted, in good faith, a license to

the defendant to use the German VALENTINS trademarks for such

purposes already through the December Agreement, the

constructive interpretation of which therefore replaced to the extent

necessary the envisaged supplementary trilateral agreement. The

purpose of this supplementary agreement was to enable the brands

to be divided into German and foreign brands without requiring a

future acquirer of the companies and brands to cease production in

Germany or to separate the labelling from the uniform production

process.

The Court of Appeal also pointed out that the construed license

was not just a simple permission—that is, a mere waiver of claims

for trademark infringement by using a sign that corresponds to the

registered trademark—but a “full” license, carrying with it a right

to use the registered trademark itself, which therefore enjoyed

protection under Section 30 (5) German Trademark Act, that is, was

binding upon successors in title of that mark (whether or not on

notice of such), including to bind the plaintiff as the purchaser of the

German trademarks.

Termination of the (implied) trademark license

Having established that an implied license existed, the Supreme

Court went on to consider the proper grounds for its termination.

The Supreme Court upheld the view of the Court of Appeal that the

defendant’s sale of VALENTINS beer to a German-based distributor

constituted valid grounds for termination. This sale contravened the

644 Vol. 110 TMR

territorial delimitation that had been the basis for the implied

license.

It is also worth noting that under German law the assignment

of a trademark that is subject to an ongoing license does not

automatically lead to the transfer of the trademark license

agreement to the assignee. Instead, the assignor of the trademark

remains as licensor, unless a tripartite agreement is entered into

with the assignor, assignee, and licensee. Under German law, the

principle of freedom of contract prevents parties to an agreement

from being forced to have a contractor that they did not agree to.

The licensee can still enforce its rights against the (former) licensor,

and the permission within the licensed marks are binding on the

successor in title (assignee) even though the license agreement,

strictly speaking, is not.

On the facts of the case, this meant that the parties to the license

agreement remained the defendant (as licensee) and the spin-off

company (as licensor), as there was no trilateral agreement

including the defendant. Although that might suggest that the

plaintiff could not terminate the license agreement, since it was not

a party, this would have effectively frustrated the purpose of the

implied licensing arrangement, which was to allow territorial

delimitation and exclusivity. This, in effect, left three options to the

Court of Appeal: (1) requiring the plaintiff to force the spin-off

company to terminate the license (fairly unsatisfactory); (2) effect a

transfer of the entire license agreement by way of supplementary

interpretation of the trademark agreement (which cut across the

principle of freedom of contract); or (3) find some kind of solution in

between these extremes.

The Court of Appeal once again sought a solution in implied

terms and purposive contractual interpretation, allowing a transfer

of the right to terminate (only). It pointed out that the spin-off

company had the intention to fully divest the brewery business and

that this required that the plaintiff must have acquired the rights

derived from the license agreement. Although no tripartite

agreement had been entered into and the plaintiff had not taken

over the license agreement in its entirety, the Court of Appeal

considered that the trademark transfer agreement between the

spin-off company and the plaintiff relating to the German

trademark implied a transfer of the right to terminate the license.

While leaving the license agreement in itself in existence between

the spin-off company and the defendant, this termination right was

required to counterbalance the fact that the defendant could hold

the license out against the plaintiff. The Supreme Court approved

this analysis—a licensee who is violating the license cannot

legitimately object to a termination of the license agreement by the

person against whom he is seeking to otherwise uphold the rights

associated with the license. Prior to this ruling, it was not generally

Vol. 110 TMR 645

accepted that a contractual right to alter the contractual

relationship (such as by termination) could be transferred

separately from the underlying contract.

Notice of termination

Even if the plaintiff was entitled to terminate the license

agreement (despite not technically being a party to it), a termination

would have required a proper termination notice. The plaintiff had

not formally terminated the license agreement, not least because

the existence of such license was only established by the Court of

Appeal.

Again, the solution lay in interpretation of the facts and

circumstances. The Court of Appeal considered that the arguments

submitted in support of the appeal before it amounted to a

termination of the license agreement. The Supreme Court endorsed

this view, along with the finding that the cease and desist letter sent

to the defendant during the proceedings would in any event amount

to a termination of any existing license. However, in that case, all

sales made prior to the statement of grounds in the appeal were

accordingly lawful and no claim for information and damages

occurring prior to that date could be awarded. Future sales of

course, would be prohibited.

4. Spain—Supreme Court—What damages are due

under Spanish law to a plaintiff that has suffered

no loss?

The Judgment of the Supreme Court of Spain in LA

NUBA/NUBAR of October 3, 2019,

204

considered the financial

remedies available to a successful plaintiff in a trademark

infringement action.

The plaintiff, owner of a Spanish national trademark LA NUBA,

registered for discotheque services, filed a combined invalidity and

infringement action against the owner of Spanish registered

Trademark No. 2934596 NUBAR, registered and used in respect of

restaurant and music bar services.

Although of course both trademarks took effect on the Spanish

trademark register, the commercial operations of the two parties

were (geographically at least) rather distant from one another. The

plaintiff operated a discotheque in Urdax, a very small town in

Navarra, Spain, on the border with France. The defendant operated

restaurants and lounge clubs in Barcelona and Ibiza using the sign

“NUBAR’”:

204

Judgment 516/2019 of the Supreme Court of Spain of October 3, 2019, cassation appeal

986/2017 (NUBAR).

646 Vol. 110 TMR

Article 43.5 of the Spanish Trademark Act provides for

automatic compensation to the trademark proprietor following a

finding of infringement known as damages ex re ipsa, set at 1% of

the turnover made by the infringer by reference to the infringing

trademark. This is, in effect, a statutory presumption of damage,

where actual damage need not be proven. In this case, 1% of the

infringer’s turnover would have been around US $100,000. It was

questioned whether the value of these damages arising from the

statutory presumption was compatible with the provisions of the EU

Enforcement Directive (EU Directive 2004/48/EC of 29 April 2004

on the enforcement of intellectual property rights). The prospect of

any actual damage seemed remote given the geographical distance

between the two operations.

The EU Enforcement Directive provides that damages should

not be punitive and must be based on objective criteria. In the

present case, the owner of the earlier trademark LA NUBA had not

suffered any real damage. Its discotheque was in a small town in

the north of Spain and did not enjoy a reputation elsewhere, while

the infringer’s activities were carried out in lounge clubs several

hundreds of kilometres away.

At first instance, the plaintiff’s complaint had been rejected as

the Court considered that there was no likelihood of confusion

between the marks due to the difference in the services

(discotheques vs restaurants) as well as the differences in overall

impression between the signs. This decision was reversed in

December 2016

205

by the Appeal Court of Barcelona, which found

both infringement and invalidity of the later mark, accordingly. The

Appeal Court of Barcelona also confirmed that the statutory rule of

minimum compensation of 1% should apply, based on a literal

interpretation of Article 45.3 of the Spanish Trademark Act.

The defendant appealed to the Supreme Court of Spain. In its

judgment

206

of October 3, 2019 (cassation appeal 986/2017), the

Supreme Court stated that the automatic compensation of 1% of the

turnover should not be interpreted as meaning that the rights

holder is entitled to this compensation even in cases where it has

205

Appeal No. 415/2015, the Appeal Court of Barcelona, December 14, 2016.

206

516/2019 of October 3, 2019 (cassation appeal 986/2017).

Vol. 110 TMR 647

been found that the infringement has caused no damage (the

plaintiff having already admitted that the infringement had caused

him no damage). According to the Supreme Court, the 1% rule is

merely aimed at facilitating the calculation of compensation, but

can and should be disapplied where appropriate, in particular where

the defendant can prove that no prejudice has been caused to the

plaintiff. In many ways however, this is a landmark decision that

changes the interpretation of a longstanding practice in Spain with

respect to the 1% automatic compensation for damages provide by

the Spanish Trademark Law.

5. Germany—Federal Supreme Court—

Stay of invalidity proceedings due to

insolvency of applicant

In its decision of January 1, 2019,

207

the Federal Supreme Court

of Germany considered whether an invalidity application filed

against the trademarks of a competitor should be stayed in

circumstances where insolvency proceedings had been commenced

against the assets of the applicant for invalidity.

The case related to an application by a Swiss company for

invalidity of the German extension of an International mark (IR No.

763 699) relating to a coffee capsule (shown right) on grounds that

the mark was alleged to lack distinctiveness in Germany.

During the appeal proceedings before the German Federal

Supreme Court, insolvency proceedings were commenced in

Switzerland against the assets of the (Swiss) applicant for invalidity

by an unrelated third party. The trademark proprietor asked the

Federal Supreme Court to suspend the appeal proceedings to

declare the invalidation proceedings suspended pending the

determination of the insolvency process, which the Federal Supreme

Court accepted.

According to the German law of civil procedure (Section 240 (1)

German Act of Civil Procedure) pending legal proceedings should be

suspended upon the initiation of an insolvency process against a

party to those legal proceedings where the outcome of the case may

affect the insolvency estate.

207

Case No. I ZB 114/17.

648 Vol. 110 TMR

In light of that provision, the Federal Supreme Court considered

that the Swiss insolvency proceedings could be considered as

comparable to German insolvency proceedings. The commencement

of a similar process in Switzerland would be sufficient to stay the

trademark invalidity proceedings in Germany because those

insolvency proceedings would affect the assets of the applicant for

invalidity in Germany.

Prior to this decision, it was accepted under German civil

procedure that the commencement of an insolvency procedure

should lead to the stay of claims for trademark infringement

regardless of whether the party under the insolvency proceedings

was the plaintiff or defendant (see Supreme Court of the German

Empire of 1931 in the drahtlose Telegraphie case

208

), given that the

outcome of such proceedings may impact the assets and trading

position of the affected party in either case. It was also accepted that

a counterclaim against the relevant trademark(s) filed in those

infringement proceedings should similarly be stayed, regardless of

whether it was the plaintiff or defendant affected by the insolvency

proceedings.

However, the question as to how to proceed in circumstances in

which there was an independent invalidity action filed had been

unresolved prior to this case, with conflicting approaches as

between the German PTO and the German Patent Court. The

German Federal Supreme Court held that an independent invalidity

proceeding should also be suspended in an insolvency event, because

the applicant would be in a comparable situation to the defendant

in a trademark infringement action filing a counterclaim for

invalidity. Further, where the trademark proprietor and alleged

infringer are competitors, the recipient of a cease and desist might

pre-empt an infringement action by filing an independent invalidity

action. This had indeed occurred on the facts of this case, although

the allegation of infringement had not yet been made in Germany,

it had been alleged under the same mark in other territories, so an

infringement action in Germany was within contemplation. As such,

a proactive invalidity action proceeding could improve the party’s

competitive position and be deemed to have an impact on the assets

of the infringer. As a consequence, the Court considered the

invalidation proceeding related to the infringer even without a

pending infringement action and hence supported the suspension of

the proceedings. The Court did not expressly rule on whether

suspension would also have been applicable in circumstances where

the defendant had not yet commenced sale of the competitive

products, but it is notable that this fact was only an additional factor

considered, rather than the determinative factor.

208

Decision of May 9, 1931, Case No. I 295/30.

Vol. 110 TMR 649

6. Germany—Nuremberg Court of Appeal—

Preliminary injunctions and lack of urgency

In its decision of October 12, 2018

209

(published in January

2019), the Nuremberg Court of Appeal considered the relative

urgency of a matter as part of the test for the grant of a preliminary

injunction.

The defendant had published a photograph that contained the

plaintiff’s trademark on a website. Upon receiving a cease and desist

letter from the plaintiff, the defendant replaced the photograph of

concern with another photograph but had refused to sign a formal

declaration by which he would have undertaken not to publish the

photograph again in the future. Because of that refusal, the plaintiff

sought a preliminary injunction against the publication of the

photograph before the Nuremberg District Court (the first instance

civil court). The defendant argued that the use of the trademark

contained within the photograph was not use as a trademark (no

use in relation to goods or services). The District Court of

Nuremberg refused to grant the preliminary injunction, citing a lack

of urgency on the facts presented, noting that the replacement of the

photograph in question ensured that the case was no longer suitable

for a preliminary court decision. The question of a trademark

infringement in those particular circumstances therefore did not

have to be resolved in preliminary proceedings.

The German Act of Civil Procedure provides for preliminary

injunction proceedings to secure rights until a final decision is

rendered if those rights would otherwise be frustrated. This implies

that a preliminary injunction will be issued in circumstances where

the matter is urgent, such that the interference of the court is

essential to secure the rights of the plaintiff and to avoid irreparable

harm.

When the decision of the Nuremberg Court of Appeal was

delivered in 2018, the German Trademark Act did not (yet) provide

a specific rule regarding the urgency of actions against trademark

infringement. Nevertheless, the established practice of the courts

was to consider it necessary to grant an injunction in circumstances

where the trademark infringement was continuing. Waiting for a

decision rendered in substantive proceedings would put the

trademark at risk of dilution and the trademark owner should not

be forced to tolerate continuing trademark infringement until trial

and judgment in substantive proceedings following. The interest of

the alleged infringer in the continued distribution of the (infringing)

product was considered to be less significant.

However, as the defendant in this case had already replaced the

contested photograph, both the Nuremberg District Court and the

209

Case No. 3 W 1932/18 (CurryWoschdHaus).

650 Vol. 110 TMR

Nuremberg Court of Appeal confirmed that the discontinuation of

the publication of the photograph removed the urgency from the

matter unless the plaintiff could conclusively demonstrate why the

urgency remained.

In January 2019 the German Trademark Act was amended to

introduce among other changes a provision according to which

preliminary injunctions can be issued without substantiation as

prima facie required by the German Act of Civil Procedure discussed

above. However, the legislation does not specifically state that in

cases of trademark infringement preliminary injunctions can be

issued without meeting the requirements set out in the German Act

of Civil Procedure, but merely states that the substantiation and

submission of prima facie evidence regarding the requirements is

waived. As such, it remains possible that a court may itself

investigate whether the infringement is continuing in deciding

whether or not to grant the injunction and the decision of the

Nuremberg Court of Appeal remains relevant.

A wider application of the decision of the Nuremberg Court of

Appeal could have a significant impact if applied to issues such as

online infringement. A product might be withdrawn from sale and

wider distribution upon receipt of a cease and desist letter in the

hope of avoiding an interim injunction and require the plaintiff to

show the product remains on sale in some locations. However, a

different approach has been taken by some other courts

210

that have

considered that the urgency of the issue continues even after the

infringement has ceased, as without a court order or a formal

declaration of undertaking there is no guarantee that infringement

has stopped and may not reoccur at some point in the future.

7. UK—High Court (IPEC)—How effective is

survey evidence in proving that the relevant public

would associate a color with the trade origin or

particular characteristics of a product?

The closely followed case of Glaxo Wellcome v. Sandoz

211

saw the

High Court finally rule on the long-running dispute between the

plaintiffs, Glaxo Wellcome UK Limited and Glaxo Group Limited

(“Glaxo”) against a number of defendants, including Sandoz, who

had marketed and sold asthma inhalers in a purple color scheme

which the plaintiffs contended was too similar to their own get-up.

Since 1999, Glaxo had been marketing a combination of

salmeterol and fluticasone for the treatment of asthma and chronic

obstructive pulmonary disease under the trademark SERETIDE, in

various inhaler forms colored purple and in purple colored

210

E.g., Court of Appeal of Munich, decision of November 14, 2013, Case No. 6 U 1888/13.

211

Glaxo Wellcome UK Ltd. & Anor v. Sandoz Ltd. & Ors, [2019] EWHC 2545 (Ch).

Vol. 110 TMR 651

packaging. In late 2015, the First, Second and Fifth defendants

(“Sandoz”) launched a branded generic competitor under the

trademark AIRFLUSAL FORSPIRO, designed by the sixth and

seventh defendants. Glaxo brought claims against the defendants in

the UK for trademark infringement and passing off for using the

color purple and a similar get-up and packaging.

Glaxo had initially intended to rely on its registered EU color

trademark for “inhalers” in class 10 described as “the color dark

purple (Pantone code 2587C) applied to a significant proportion of

an inhaler, and “the color light purple” (Pantone code 2567C)

applied to the remainder of the inhaler.” However, in 2016 the first

defendant was successful in an application for summary judgment

dismissing Glaxo’s claim for trademark infringement because the

mark relied upon was not sufficiently precise and uniform and had

been invalidly registered pursuant to Articles 52(1)(a), 7(1)(a) and 4

of the 2009 EUTM Regulation.

212

This interim decision was reported

in the 2017 edition of this Review.

213

Having lost the relevant trademark protection, the trial

considered the claim under the UK tort of passing off. Although

some aspects of the case are quite fact-specific given the highly

regulated nature of the products at issue, the ruling nevertheless

provides clarity on a range of issues including the use of survey

evidence to demonstrate distinctiveness as well as

misrepresentation of trade origin and deception. The High Court

ultimately dismissed all of Glaxo’s claims due to the lack of evidence

proving goodwill and misrepresentation.

In reviewing the evidence submitted by Glaxo, the High Court

clarified that such evidence must demonstrate that the feature of

get-up relied upon by the plaintiffs, being the color purple, was

distinctive in the mind of the relevant public either of the trade

origin, or of the relevant characteristics of the SERETIDE inhaler.

The High Court considered that the starting point would always be

the general rule that the color of a product is typically devoid of

distinctiveness as consumers do not ordinarily identify the origin or

characteristics of a product “by reference to the color of the product

or its packaging.” However, there may be exceptions whereby

distinctiveness may be acquired as to trade origin or be distinctive

of the characteristics of the product through the use made of it.

Glaxo had relied upon marketing materials, patient leaflets and

survey evidence to prove that the color purple had become

distinctive as to the trade origin of SERETIDE among healthcare

professionals (“HCPs”). However, the High Court noted that the

evidence did not indicate that the trade origin of the inhaler was of

212

These provisions are now at Articles 59(1)(a), 7(1)(a), and 4 of the 2017 EUTM

Regulation.

213

Guy Heath, Annual Review of EU Trademark Law: 2017 in Review, 107 TMR 465 (2017).

652 Vol. 110 TMR

a SERETIDE inhaler but only that the HCPs would associate it with

the combination of salmeterol and fluticasone, in accordance with

the general color convention of inhalers in the UK. As such, the color

scheme might have been distinctive as to characteristics, but not as

to trade origin.

The High Court also revisited the long-standing law on the use

of surveys for the purposes of trademark and passing off proceedings

under the “Whitford Guidelines,” as formulated by J Whitford in

Imperial Group PLC v. Philip Morris Ltd.,

214

subsequently endorsed

by Lewison LJ in Interflora Inc v. Marks & Spencer PLC.

215

Applying those general principles to the case at hand, the majority

of survey evidence used by Glaxo did not adhere to those guidelines,

which affected the weight of importance given to the survey

evidence by the High Court. In addition to a lack of compliance with

such rules, the High Court concluded that the survey evidence had

no real probative value as the evidence had simply indicated that

HCPs recognized the color purple as a feature of SERETIDE

inhalers. For the evidence to have been effective in establishing

distinctiveness, the survey answers would need to indicate that

HCPs would associate another inhaler bearing the same shade of

purple with the same trade origin.

The High Court also considered that the relevant public for

inhalers would also include the patients themselves and not just

HCPs. However, Glaxo had adduced very little evidence to

demonstrate that purple was distinctive of the trade origin of

SERETIDE in the minds of patients and had not conducted any

survey of patients. In addition, despite dedicating significant

resource to the preparation of its case, Glaxo was able to identify

only six instances of confusion, none of which evidenced confusion

on the part of patients. The High Court ruled that there was no

actual confusion among patients as to trade origin.

The ruling reiterates the need for survey evidence to comply

with the “Whitford Guidelines” in order to ensure that the evidence

has value from the court’s perspective. In order to prove

distinctiveness, the survey evidence must go further than simply

showing that the relevant public would associate the color of a

product with the general color convention in the industry, as

otherwise the evidence proves only that the color is capable of

distinguishing that product’s characteristics from other colored

products rather than their respective trade origins.

214

[1984] RPC 293.

215

[2012] EWCA Civ 1501, [2013] FSR 21, at para. 61.

Vol. 110 TMR 653

8. Denmark—The Danish Maritime and Commercial

High Court—When may protected names be used as

trademarks?

On May 10, 2019, the Danish Maritime and Commercial High

Court delivered its ruling in respect of the consolidation of several

injunction proceedings filed by the descendants of the Ørsted family

(“Ørsted Family”): (i) the famous Danish physicist Hans Christian

Ørsted (“H. C. Ørsted”); and (ii) the brothers of H. C. Ørsted, Anders

Sandøe Ørsted and Jacob Albert Ørsted (who were both also famous

Danes). The key issue in the case was whether the Ørsted Family

could prevent the Danish energy company Ørsted A/S (“Ørsted”),

formerly “DONG A/S,” and its subsidiaries, from using the name

“ØRSTED” (a) as a company name, (b) as a registered trademark,

and (c) in relation to Danish top level domain names (“.dk”) on the

grounds that the Ørsted name was a protected name under the

Danish Act on Personal Names and the Danish Trademark Act.

Ørsted and its subsidiaries make up one of the largest energy

companies in northern Europe, with the Kingdom of Denmark as

the controlling shareholder. On October 30, 2017, the shareholders

of Ørsted voted to change the company name from “DONG A/S” to

“Ørsted A/S.” The name was chosen both as an homage to H. C.

Ørsted, with reference to the company’s kinship with the scientist’s

work, and as a part of a new company strategy. Prior to the vote,

Ørsted registered “Ørsted,” “Oersted,” and “Orsted” as the company

name, filed several EUTMs (including EUTM No. 015781115

ØRSTED (word) and No. 016429615 ORSTED (figurative)), as well

as several “.dk”-top level domain names. As part of the promotion of

the name-change, Ørsted invited several people with the surname

“Ørsted” to celebrate the event, including many of the plaintiffs.

The Ørsted Family are all descendants of either H. C. Ørsted or

his brothers. The name “Ørsted” is both famous and rare in

Denmark. According to the case, fewer than 500 people in Denmark

use the name “Ørsted” as a surname. According to Danish law, a

surname has a protected status if fewer than 2,000 people use the

name. Further, a name is considered “rare,” and therefore protected

pursuant to the practice of the Danish Patent and Trademark

Office, if fewer than 30 people bear the name (the latter not being

satisfied on the facts of this case).

Court decision

Between January 5 and 19, 2019, the Ørsted Family filed several

requests for injunctive relief before the Maritime and Commercial

High Court. The Ørsted Family argued that Ørsted could not use

the name as a registered EUTM on grounds of the name being a

protected surname, which is a relative ground for refusal in

accordance with the Danish Trademarks Act (Section 15(3)(6) being

654 Vol. 110 TMR

equivalent to the 2008 TM Directive Article 5(4)(b)(i)), as well as

being restricted from registering and using it as a company name or

as a ‘.dk’-top level domain name.

Ørsted argued that the Danish Personal Names Act did not

provide an exclusive right enforceable against legal entities and that

an assessment of the facts at hand—using the principle of lex

specialis—should be based on the Danish Trademarks Act and

Company Act, respectively, and not the Danish Act on Personal

Names. Additionally, Ørsted argued that their use was legitimate,

as “Ørsted” was inspired by a reference to a long-deceased person

and his associated reputation, not a reference to a living person.

Ørsted also argued that through its extensive marketing

campaign—which was based on the connection between the

company and the scientist H. C. Ørsted—the company had provided

evidence that the exploitation of the name was not in reference to

the Ørsted Family as such, but specifically the scientist.

The exemptions in the Danish Trademarks Act are interpreted

narrowly by the Court. The Maritime and Commercial High Court

found that the earlier right to a protected name does not provide a

ground for refusal in accordance with Section 15(3)(6) of the Danish

Trademarks Act (Article 5(4)(b)(i) of the 2008 TM Directive when

the use of the name refers to a person who is long-deceased). The

Maritime and Commercial High Court highlighted that,

historically, the scientist H. C. Ørsted is and has been referred to by

both (i) the shortened version of his name (“H. C. Ørsted” from

“Hans Christian Ørsted”), and (ii) simply Ørsted,” when his name

was used relative to his scientific work. The Maritime and

Commercial High Court then found that because there is a link

between energy production, which is core area of business of Ørsted

(the defendant), and H. C. Ørsted’s body of research and scientific

work, the use of “Ørsted,” only, without use of the scientist’s initials

or first names, as an identifier, was adequate when making the

reference to the (long deceased) person H. C. Ørsted in relation with

renewable energy. Further, since renewable energy was the field in

which H. C. Ørsted was most famous and well known this type of

usage would not be considered a general reference to the (protected)

surname “Ørsted.” As such, the Maritime and Commercial High

Court found that the reference to a long-deceased person in

accordance with Section 15(3)(6) of the Danish Trademarks Act

(Article 5(4)(b)(i) of the 2008 TM Directive), is not contingent on an

accurate reference to the full name, if the context of the use

promotes an understanding of exact reference to the specific person,

in this case being the association of the name Ørsted with the

production of energy.

The Court also found that as the earlier right to a protected

name could not prevent the use of the name as a trademark, that

Vol. 110 TMR 655

trademark could also freely be used as both the name of the business

and as part of a .dk-top level domain name.

Overall, it was not sufficient that the “Ørsted” name was

protected under the Danish Act on Personal Names and that the

Ørsted Family thereby had interests in the name “Ørsted.” The

company was named after a person who was long-deceased, not the

family members bringing the claim. The case has been appealed by

the Ørsted Family to the Danish Supreme Court and judgment is

expected in 2020.

9. Sweden—Swedish Patent and Market Court—

Should the test for distinctiveness differ as between

trademarks and Swedish business names used in the

course of trade?

In GDL Transport Aktiebolag v. Swedish Companies

Registration Office,

216

the Swedish Patent and Market Court

considered the need for consistency of approach as between the test

for distinctiveness of a Swedish business name (Sw:

“företagsnamn”) and that of an application to register a trademark.

By way of background, in Sweden a business name is considered

a “sign used in the course of trade” consistent with Article 5(4) of

the EUTM Directive, in the sense that it grants the company similar

rights as those conferred by a trademark, namely the ability to

prohibit a third party from using or registering an identical or

similar business name or trademark for identical or similar

activities. Similarly, the existence of an earlier trademark or

business name can be raised as an obstacle to the registration or use

of a later trademark or business name.

According to the Business Names Act,

217

a business name may

only be registered in Sweden if it is capable of distinguishing the

company’s business from other parties (corresponding to the

requirements set out in Article 4(1)(b) in the EUTM Directive). The

plaintiff sought to change their business name to “GDL” from “GDL

Transport.” The Swedish Companies Registration Office rejected

the request on the basis that the new name consisted of only three

characters and as such lacked a sufficient degree of distinctiveness.

The Office based their decision on their long-standing precedent

that the assessment of the requirement of distinguishing character

was different for business names in comparison to the one used for

trademarks. As such, a short three-letter name could not be

considered sufficient to distinguish the company from any other

companies, according to the Office.

216

GDL Transport Aktiebolag v. Bolagsverket, Case PMÄ 10269-19.

217

Swedish: “Lag (2018:1653) om företagsnamn.”

656 Vol. 110 TMR

On appeal to the Swedish Patent and Market Court, the Court

noted that the legislator intended for there to be a high degree of

coordination and correlation between rights conferred by signs used

in the course of trade such as business names and trademarks. As

such, the Court found there to be no legal basis for setting a higher

standard for the distinguishing character of business names when

compared with trademarks. In consideration of the evolution of the

legal precedent in trademark law since Sweden’s accession to the

EU in 1995, the business name was deemed capable of

distinguishing one entity from another.

X. GLOSSARY

CJEU:

The Court of Justice of the European Union,

which refers to

itself simply as “the Court of

Justice.” Before the entry into force of the Treaty

of Lisbon in December of 2009, it was known as

the “European Court of Justice,” or the “ECJ,” and

is still often referred to as such.

COA:

Court of Appeal.

EEA:

European Economic Area.

EUIPO:

The European Union Intellectual Property Office,

being the office that handles EU trademark

applications, oppositions, and cancellation

actions. It was previously called (in its English

language version) the “Office for Harmonization

in the Internal Market” or “OHIM.” (The name

was changed was effective March 23, 2016.)

EUTM or

trademark:

A registered trademark obtained by means of the

EU’s centralized procedure (i.e., by application to

the EUIPO), which provides rights throughout

the entire area of the European Union. (Note that

the name was changed from “Community

Trademark” (“CTM”) to “EU Trademark”

(“EUTM”), effective March 23, 2016.)

EU General

Court:

The EU court with jurisdiction to hear appeals

from the Boards of Appeal of EUIPO.

Member

State:

A country that forms part of the European Union

from time to time.

sign:

As used (but not defined) in the EUTM Regulation

and the TM Directive, “sign” is used to refer to the

subject matter of which a trademark may consist

and is also used (in the context of trademark

Vol. 110 TMR 657

infringement) to refer to the offending word,

device, or other symbol that the defendant is

using; often used in practice when the word

“mark” could be used.

Union:

The European Union.

2008 TM

Directive:

Directive 2008/95/EC of October 22, 2008, which

provides for the harmonization of the laws of the

EU Member States in relation to trademarks; it

codified the earlier Council Directive 89/104/EEC

of December 21, 1988. This has now been

amended and recast as the 2015 TM Directive,

which repealed the 2008 TM Directive as of

January 15, 2019.

2015 TM

Directive:

Directive (EU) 2015/2436 of December 16, 2015,

which provides for the harmonization of the laws

of the EU Member States in relation to

trademarks and takes over f

rom the 2008 TM

Directive.

2009 EUTM

Regulation:

Council Regulation (EC) No. 207/2009 of

February 26, 2009, which provides for EU

trademarks; it codified the earlier Council

Regulation (EC) No. 40/94 of December 20, 1993.

This was amended by Regulation (EU) 2015/2424

of the European Parliament and of the Council

(December 15, 2015) with the amendments taking

effect on March 23, 2016. (However, references to

the EUTM Regulation in this Review are still

generally to the 2009 version of the Regulation

unless stated otherwise.)

2017 EUTM

Regulation:

Council Regulation (EU) No. 2017/1001, which

provides for EU trademarks. It is a codified form

that reflects the amendments made by Regulation

(EC) 2015/2424 to the 2009 EUTM Regulation.

Note: EU trademark laws and EU lawyers use the term

“trade mark” rather than “trademark.” However,

references in this issue have been changed to “trademark”

to conform to the norms of The Trademark Reporter.

GUIDELINES FOR SUBMITTING A MANUSCRIPT TO

THE TRADEMARK REPORTER

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related topics under U.S. and international law, including articles, commentaries, and book

reviews. Submissions may be sent via email to [email protected].

Please see the TMR Style and Submission Guide at https://www.inta.org/TMR/Pages/

StyleGuide.aspx.

THE TRADEMARK REPORTER ONLINE

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