The issue of registration of state names as trademarks has recently been the subject of a Paris Court of Appeal ruling (22 September 2017).
The US company France.com Inc. was the proprietor of the domain name “france.com” registered since 1994. The Dutch company Traveland Resorts registered in its own name a number of French and EU trademarks (word and figurative) “France.com” in 2009 and 2010. The US company brought proceedings against the Dutch company before the French courts in 2014. Subsequently, the Dutch company transferred the trademarks to the US company.
The French State and the GIE Atout France (the French national tourism organization) intervened in the court proceedings between the two companies asking initially that all the marks and the domain name be transferred to the French State and subsequently that the marks be annulled or surrendered.
The Paris Court of First Instance found the intervention admissible and ruled that all marks and the domain name be transferred to the French State. Upon appeal (by the US company), the Paris Court of Appeal for the most part confirmed the first instance ruling, namely to the extent that the French marks were annulled and the domain name had to be transferred to the French State. As regards the EU trademarks, the Court of Appeal held that their validity was for the EUIPO to judge.
The arguments of the appellant included a) that art. 6ter of the Paris Convention on the protection of state emblems, flags and other insignia was not applicable, and b) that the French State did not own any prior rights, the term “France” being a mere geographic indication, different to the official name(s) of the French State as per the French Constitution.
The French State, in turn, relied on bad faith, on deceptiveness of the marks or their being against public order, and a monopoly to “France.com” for a US tour operator being against public interest.
The annulment of the French marks and transfer of the domain name were based on bad faith and public order and, in addition, it was found that the French State had prior rights to the denomination “France”. The word “France” constituted for the French State an “element of identity” similar to those of natural persons, as it indicated the national territory in its economic, geographical, historical, political and cultural identity. The suffix “.com” did not differentiate the signs at issue adequately. Therefore, the public would identify the goods and services under the marks as emanating from the French State or under the auspices of the French State.
The more general questions addressed in the ongoing WIPO study were not the center of attention in the Court proceedings.
WIPO has been conducting a study across various countries and territories of the Paris Convention regarding the issue of state names as trademarks. The landscape is quite diverse: some countries have in their trademark legislation a reference to article 6 ter of the Paris Convention listing the symbols, flags etc. that are excluded from registration. Others have expressly prohibited the registration of state names as trademarks, again others have provided for categories of state names trademarks that are registrable (e.g. only official names) and those that are not (see WIPO/Strad/INF/7, November 23, 2015). Among the few countries that have an express legislative prohibition (since 2012) is Greece.
It is worth noting that the word mark “France.com” no 8791808 was rejected by EUIPO as non-distinctive and descriptive and a figurative mark “France.com” (application no. 13158597) has been refused based on an opposition brought by the French State; the case is pending before the General Court (T-71/17).
The General Court (T197/13) previously refused trademark protection to the Principality of Monaco for the word mark “MONACO” on absolute grounds stating that the “need to be freely used by all” principle applies to states in the same way as to individuals (par. 43) and affirming the BoA finding that “a public or government body [had] no special entitlement to a trade mark” (par. 33).
This is a complex issue that demands a fair balance of the different legal interests. It remains to be seen whether the traditional absolute and relative grounds shall be able to provide adequate solutions.
In a recent statement, the European Commission has confirmed that institutions and individuals based in the UK will no longer be able to register domains using the .eu TLD, as of the UK’s withdrawal date from the EU (which currently stands at 29th March 2019*). For those institutions or individuals who currently own such a domain, they will not be permitted to renew.
Plenty of larger brands, which may benefit from additional European bases of commerce and the ability to meet geographical requirements, will not lose their domains to this development. Small to medium sized brands, however, which cannot demonstrate such a base in one of the 27 remaining member states will stand to lose their domains. This presents an interesting situation, however, since there will almost certainly be parties waiting for the conclusion of the transition period, with countless snap backs in place, hoping to catch the .eu domains of brand owners who are no longer permitted to renew. Whilst there are domain dispute mechanisms which may assist these parties, these processes carry with them a further administrative and financial burden.
The company responsible for management and administration of the .eu TLD is EURID, who appear to have been caught unawares in much the same manner as the general public, as they received the communication with no prior warning or consultation. As a company based in an EU27 member state (Belgium), this lack of consultation or prior warning highlights the degree of uncertainty overseas, as well as the UK, due to the pending extrication of the UK from the EU.
This development is somewhat reminiscent of the doomsday scenario presented by the Commission at the tail end of 2017, whereby they highlighted possible ramifications for the UK leaving the EU with no deal. Certainly the negotiations governing the exit process, whilst involved and convoluted, are vital in order that the interests of brand owners both domestic and community based remain protected.
By virtue of law 4512/2018, which was published on 17 January 2018, all disputes concerning trademarks, patents and industrial designs initiated before civil courts in Greece are subject to mandatory mediation. Hearing of the cases shall be inadmissible if the mediation process stipulated in the law has not been followed. The provisions shall start to apply as of 17 October 2018.
Plaintiffs are required to submit a request for appointment of a mediator from the list of mediators available on the Greek Ministry of Justice website and invite the other party or parties to collaborate for arranging a mediation within the 15 days following such invitation. The mediation as such shall not exceed 24 hours unless otherwise agreed by the parties. The mediation must be completed within 30 days following the initial invitation. This may be extended upon mutual agreement of the parties by 30 more days. What is important, mainly for foreign entities, is that physical presence is not required, and mediation can be conducted via teleconference. In the mediation proceedings, the parties are present together with their attorneys. The parties may decide at this first meeting that they do not wish to engage in the mediation process. This shall suffice for purposes of admissibility of the hearing. If parties reach an agreement, the respective minutes including the settlement agreement may be submitted to the court secretariat for certification by any of the parties and become an enforcement title. Interim measures are not precluded pending mediation proceedings.
The above applies only to civil disputes, namely, disputes related to infringement of trademark rights. They do not apply to office actions, namely, oppositions or cancellation actions. However, the Greek trademark law is currently under revision within the context of implementation of the new trademark directive. It shall be interesting to see if and how mediation is introduced also for any disputes raised before the trademark office.
Fast-track trademark and patent registration has become available in Russia.
That has definitely made Russia one of the most favorable jurisdictions in Europe, at least when it comes to the length of time you spend.
Early in April, the Russian Patent Office (Rospatent) officially launched a service for fast-track registration of trademarks.
The fast-track option has become available for those applicants who ordered and payed an official trademark search report in Rospatent in respect of all 45 Nice classes.
The official fee for this service is EUR 1 500 (RUR 94 400), the term is 10 calendar days. For a combined trademark, though, the fee should be multiplied for each comprised element (verbal or visual).
In order to use a fast-track option, the applicant should submit to Rospatent (1) a conflict search report along with (2) a trademark application and (3) a written request to conduct fast-track registration.
The option is available for all new and already pending applications. It significantly shortens the stage of a legal expertise – up to 2 months. Thus, the new option reduces an overall term of registration from 12-18 months (current term) to 3-4 months (expected fast-track term).
On the one hand, Rospatent assures that haste should not undermine quality. On the other hand, the Civil Code provides for 9 refusal grounds to be examined by Rospatent (Civil Code, art. 1499), while the trademark search report may cover only 1 ground.
Considering such a wide scope of examination, would a significant time decrease result in a comparable increase of mistakes? A certain side effect may come, that makes the fast-track option indeed useful for trademarks bearing no risk of refusal (if one ever existed!).
Interestingly, the same opportunity has become available for patents. To enjoy this opportunity, an applicant should obtain a similar official search report for its invention, utility model or design.
The official fee for the service may vary from EUR 750 (RUR 47 200) for industrial designs to EUR 1 500 (RUR 94 400) for inventions and utility models, the term is 10 calendar days.
As a result, registration in Russia may become far more simplified for IP holders interested in soonest protection and realizing the risks of accidental expert mistakes.
It does not happen every day that you can see a trademark case decided by the EU General Court with a Polish claimant (EUTM applicant), represented by his Polish attorney, with a Polish judge as the rapporteur and even with Polish national acting as the EUIPO’s representative. One of very few non-Polish aspects of this case is the trademark itself – the word mark ‘HOUSE OF CARS’, applied for inter alia various vehicle and transport related services in classes 35, 37 and 39.
With its judgment of April 17, 2018 (T-364/17), the General Court confirmed the earlier decisions of the EUIPO and the Board of Appeal, according to which the EUTM ‘HOUSE OF CARS’ is devoid of any distinctive character in respect of the services at issue and must be refused registration under Article 7(1)(b) EUTMR. As the Court stated, the trademark applied for consists of elements that have a meaning in English and, therefore, the assessment of its distinctiveness must be carried out from the point of view of the English-speaking public. The word ‘HOUSE’ can be understood as a building having specific purpose, a company or institution, while the word ‘CARS’ obviously means ‘cars’ (i.e. vehicles). When linked with the preposition ‘OF’ (i.e. correctly from the English grammar point of view), altogether these words can be understood as a ‘company running the vehicle-related business’. Consequently, the sign has direct relation to the respective services (which directly concern or may concern the vehicles) to such an extent that the relevant public, immediately and without further reflection, will see in it the definition of the company’s activity and its specialization (car industry). For that reason, the sign will not be perceived by the relevant public as an indication of the commercial origin of the services. The Court also confirmed the finding that the fact that the sign at issue may also have other meanings cannot undermine the conclusion that the mark applied for is devoid of any distinctive character. Also the argument that the expression “house of cars” does not exist on the market was not convincing for the Court, which stated that the mere fact that the expression is not actually used by other market operators is not sufficient to establish that such expression can serve as an indication of the commercial origin of the services at issue. Finally, the Court confirmed that the Board of Appeal was right to note that it is sufficient for the application of Article 7(1)(b) EUTMR that certain services may relate to vehicles and the link with vehicles has not been excluded, even in the lack of explicit references to vehicles in the specification. This makes them all belong to one category or group of services, which is sufficiently ‘homogenous’ for the purposes of examination of the trademark’s distinctiveness.
Finally, the Court (making several references to another EU trademark case with Polish background: Agencja Wydawnicza Technopol / OHIM, C-51/10) confirmed that the earlier decisions of the EUIPO and the Board of Appeal were not in breach of the principles of protection of legitimate expectations and legal certainty. The fact that the EUIPO had previously registered other ‘HOUSE OF …’ marks should not be an argument in the case at issue because – with such a clearly non-distinctive sign as ‘HOUSE OF CARS’ – the principle of legality cannot be infringed to satisfy expectations that the applicant could have had in relation to the registration of another mark based on the same concept. The legality of the decisions of Boards of Appeal must be assessed solely on the basis of the EUTMR, as interpreted by the EU judicature, and not on the basis of a previous decision-making practice.
While the Court’s approach presented above is not very surprising in light of the well-established case-law, one may also consider whether ‘HOUSE OF CARS’ is not a nice wordplay on ‘HOUSE OF CARDS’…
EU Design law denies protection to designs which are solely dictated by a product’s technical function (art. 8(1) CDR). But how to determine if a product’s appearance is solely defined by its technical function in order to deny protection to a design?
German courts, for instance used to apply the “multiplicity of forms” test, where a design is not considered as “solely dictated by its function” if alternative designs exist which fulfill the same function. Instead EUIPO has (since the “Chaff cutters” case, R 690/2007-3, 22 October 2009) been using the “no-aesthetic-consideration” test, in which a design is solely dictated by its function providing every feature of the design was determined by technical considerations, regardless of the existence of design alternatives.
With decision C-395/16 DOCERAM GmbH v CeramTec GmbH of 8 March, 2018, the European Union Court of Justice (“CJEU”) has now indicated that EUIPO’s approach is the correct one.
The case, on a reference for a preliminary ruling from a German Court, concerned the validity of design registrations for ceramic weld-centring pins, and the CJEU was asked to clarify if the existence of alternative designs is decisive, in order to ascertain whether the features of appearance of a product are solely dictated by its function, or whether it must be instead established that function is the only factor which dictated those characteristics, and, in this latter case whether such a finding should be based on the perception of an “objective observer”.
The CJEU first of all observed that the expression ‘features of appearance of a product which are solely dictated by its technical function’ is an expression whose meaning is not defined in any legislative provision and an autonomous concept of EU law which must be interpreted in a uniform manner in all the Member States.
Thus, CJEU reasoned that if the existence of alternative designs fulfilling the same function as that of the product concerned were sufficient in itself to exclude applicability of Art. 8(1), a single economic operator would be able to obtain several registrations of different possible forms of a product incorporating features of appearance of that product which are exclusively dictated by its technical function. This would imply a monopolist result which run counter to the principles of the EU. Thus, the CJEU held that to determine whether the features of appearance of a product are exclusively dictated by its technical function, it must be established that the technical function is the only factor which determined those features, regardless from the existence of alternative designs.
Furthermore, in order to assess whether the features are solely determined by technical function, the CJEU held there is no need to base those findings on the perception of an ‘objective observer’”, but “all the objective circumstances relevant to each individual case”, including the existence of a design alternative (provided that they are supported by “reliable evidence”) must be taken into account.
This decision, which of course may result in a change of practice for some Member States’ Courts, is not really surprising, following a string of cases issued in regard not only to designs (cf. Easy Sanitary Solutions v Group Nivelles, C-361/15, on the irrelevance of the sector of use to determine novelty and individual character), but also 3d marks (cf. the Philips vs Remington case, C-299/99, where it was held that when then essential functional characteristics of the shape of a product are solely linked to its technical function, the sign of that shape cannot be registered, even if that technical result can be achieved by other shapes) and descriptive word marks (cf. Technopol vs. Ohim, C-51/10 where it was held that the availability of other signs, for designating the same characteristics of the goods/services referred to in the application for registration, is irrelevant in determining whether a sign is descriptive).
Whether this trend will continue or not is of course hard to predict, but as always, we’ll be here to monitor and report.
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The UK Intellectual Property Office has recently declared invalid Birkenstock’s UK trade mark registration for the pattern on the sole of their shoes. The decision of the Appointed Person, James Mellor QC, not only considers a slightly unusual mark, it also provides helpful guidance on factors to consider if a brand owner is trying to show acquired distinctiveness of its sub-brand.
The original decision
The dispute arose following Eurogloria s.l.’s application for a declaration of invalidity against Birkenstock’s UK trade mark registration for a ‘pattern applied to the sole of footwear’. Birkenstock’s mark was registered in respect of orthopaedic footwear in class 10 and footwear generally in class 25.
The action was based on Sections 3 (1)(b), (1)(c), (1)(d) and (2) of the UK Trade Marks Act 1994, with the applicant alleging that the mark was devoid of distinctive character, descriptive of the goods, customary in the trade, and that it fell foul of all of the shape objections. Interestingly, it only succeeded in relation to Section 3 (1)(b) for a lack of distinctiveness, with Birkenstock unsuccessfully arguing that the mark had acquired distinctiveness through use.
Birkenstock appealed the Hearing Officer’s original decision to Appointed Person, and sought to do so under three main headings of appeal.
The Hearing officer committed seven errors in coming to her decision, the first six of which would render original decision unsound if found to be correct;
If no individual error is substantial enough, the Hearing Officer came to a decision which no other reasonable Hearing Officer would have come to, based on the evidence; and/or
The Hearing Officer committed five errors in failing to find the Birkenstock sign had acquired distinctiveness.
The Appointed Person went through each of these grounds of appeal, and ultimately found none of them to have any significant weight. As a result, the original decision was upheld, with Birkenstock’s registration being declared invalid for a lack of distinctiveness.
They also failed to meet the bar for acquired distinctiveness through use and this is perhaps the most interesting part of the case, namely the discussion around acquired distinctiveness of a sub-brand when used alongside or in conjunction with a main brand.
Birkenstock argued that their sole device was a sub-brand, under their main BIRKENSTOCK brand. They further argued that, based on the Hearing Officer’s original decision, ‘no sub-brand could ever have acquired distinctiveness when sold in conjunction with a main brand’.
Birkenstock were nothing if not resourceful in providing evidence to demonstrate that the mark had acquired distinctiveness. In addition to the usual sales figures and samples of advertising, their evidence included extracts from a blog which discussed the incorrectly aligned pattern on the sole of a pair of counterfeit Birkenstock sandals. This, it was argued, demonstrated that counterfeiters saw the pattern on the sole as necessary to indicate the origin of the goods. At least one part of the relevant public had therefore come to understand the pattern as a brand. However, the Appointed Person took the view that this evidence only demonstrated that counterfeiters try to reproduce the genuine goods, and was not evidence that the sole pattern is regarded as a badge of origin, either by counterfeiters or the general public.
The Appointed Person noted that it’s ‘a common and well-recognised problem’ that it is hard to show that one part of the appearance of the goods conveys an origin message, when the ‘main brand’ itself normally conveys a very clear origin message of its own.
However, he stated that one potential option, and way to show that a sub-brand conveys the necessary origin message, is by showing that the brand owner has ‘the confidence to rely on the sub-brand to convey an origin message in its marketing’.
It therefore seems that there are two questions which need to be answered when trying to show that a sub-brand has acquired distinctiveness:
Whether the brand owner trusts the sub-brand to convey the necessary origin message; and
Whether that trust, and the origin message, are clear in the brand owner’s marketing
Whilst it therefore appears possible to envisage circumstances where a sub-brand is used alongside or in conjunction with the main brand, and can meet these theoretical two requirements for acquired distinctiveness, it would appear to be significantly harder than using the sub-brand alone – which would show a far higher level of trust in the sub-brand and its ability to convey the origin message.
Whilst this guidance from the Appointed Person may suggest that it’s getting harder to prove acquired distinctiveness of a sub-brand, it does at least provide a useful steer on the sort of use which brand owners should be making of their trade marks if they want to obtain UK trade mark protection through acquired distinctiveness.
On 19 April 2018, the CJEU handed down its judgment in the matter Peek & Cloppenburg (PUC), a referral from the German Supreme Court in a litigation between two German companies of that same name (one of which runs under the name of Peek & Cloppenburg [PuC] “North”, the other “West”) (C‑148/17).
The question to the Court concerned the conditions under which a national mark that has lapsed or been surrendered by its proprietor who relied on a seniority claim based on that mark could be declared invalid or revoked “a posteriori” (with the result that the seniority is lost). More specifically, in a context of a challenge based on non-use, the CJEU had to decide the relevant point in time for assessing whether the national mark had been genuinely used – at the time that it lapsed or was surrendered, or also at the time of the non-use revocation action.
The CJEU decided that, in the context of a later invalidity or revocation action brought against a national mark that has been surrendered or allowed to lapse, the conditions for cancellation of the mark are to be assessed only as at the time of the surrender or expiry of that mark. The effect of the seniority, whereby the trademark owner was to be treated as if the national mark continued to exist was deemed to be limited to the protection enjoyed by the earlier national trademark, not the other effects of registration.
Facts: PuC North had a German mark “PUC” and an EUTM and had claimed the seniority of the German mark under the EUTM. PuC West apparently had use-based rights in Germany that pre-dated the CTM but post-dated the German mark of PuC North. In an earlier litigation, PuC West had requested the revocation of PuC North’s German mark. This action was terminated by PuC North surrendering that mark. Apparently, at the time, it did not occur to PuC West to request the revocation a posteriori of the – now surrendered – mark to get rid of the seniority claim under PuC North’s EUTM.
PuC North subsequently started using PUC in Germany, and PuC West brought an infringement action. In its defense, PuC North relied on its earlier German seniority date. PuC West argued that the German registration had to be revoked because, before its surrender, it had not been genuinely used. PuC North, in turn, argued that the mark could not be revoked because its use in Germany had meanwhile commenced.
Legal issue at stake: The question was – (a) did the use made of the mark in Germany after surrender of the national mark (relying on seniority) count towards the validity of the seniority claim or (b) did the validity of the seniority claim depend on whether the national mark was vulnerable to revocation at the time of its surrender (or expiry). The CJEU went for (b).
Legal background: One would have thought that the law was crystal clear: As per Article 39(3) EUTM Regulation, “seniority shall have the sole effect … that, where the proprietor of the EU trade mark surrenders the [national] mark or allows it to lapse, he shall be deemed to continue to have the same rightsas he would have had if the [national] trade mark had continued to be registered”. With that in mind, using a previously unused mark would save that mark from revocation in accordance with general trademark law in Europe, whether the mark continued to be registered or was “deemed” to continue to be registered, as per Article 39(3) EUTMR.
The key observation by the CJEU is in § 30 of the judgment:
That provision [Article 39(3)] creates a fiction intended to enable the proprietor of the EU mark to continue to enjoy, in that Member State, the protection enjoyed by the earlier national mark which was cancelled and not to enable that mark to continue to exist in the same form. It follows, in particular, that any use of the sign at issue after that cancellation must be regarded, in such a case, as use of the EU mark and not of the cancelled earlier national mark.
Comment: The CJEU judgment is really bad news for EUTM owners who have dropped national rights relying on their EUTMs and seniority claims – which was precisely what the law encouraged them to do. The judgment as well as the reference by the German Supreme Court may be understandable with a view to the facts in that particular case. However, the ease with which acquired positions of thousands of trademark owners are destroyed, 22 years after the first seniority claims were raised, is disturbing. Seniority was meant to allow the bundling of trademark rights in the EU without any loss of rights. Losing the possibility to “heal” the non-use of a registered mark by putting it to use is a very significant loss and one which actually means, in practice, that one can only risk dropping a national mark relying on seniority if genuine use in the country in question at that time is beyond any question and is well-documented complying with current and potential future requirements to the evidence of genuine use. That is quite clearly not what the law intended, neither the Regulation nor the Directive – old or new!
The federal district court in Tampa properly determined that a karaoke disc jockey’s use of unauthorized copies of karaoke tracks displaying Phoenix Entertainment Partners’ SOUND CHOICE mark did not constitute trademark infringement or unfair competition under the Lanham Act, the U.S. Court of Appeals in Atlanta has ruled in an unpublished decision. Adopting the reasoning of the Seventh and the Ninth Circuits in rejecting similar Lanham Act claims brought by Phoenix in other cases against karaoke venues and disc jockeys, the Eleventh Circuit held that Phoenix failed to plausibly allege any consumer confusion (Phoenix Entertainment Partners, LLC v. Casey Road Food and Beverage, LLC, March 13, 2018, per curiam).
The Benelux trade mark system will undergo two important changes as per June 1, 2018.
Appeals from decisions of the Benelux Office for Intellectual Property (BOIP)
Until now appeals from decisions of the BOIP in opposition cases were brought before the courts of appeal of The Hague, Brussels or Luxembourg (with further appeals on questions of law to the respective supreme courts). This resulted in some quite different results. For example, in cases of refusal on absolute grounds, the Court of Appeal of The Hague tended to confirm absolute grounds refusal decisions, whereas the Court of Appeal of Brussels was inclined to squash refusal decisions and to accept the trade marks.
As per June 1, 2018, all appeals from decisions of the BOIP (refusals, oppositions etc.) have to be brought before the Benelux Court of Justice (BCJ). This Court established a new chamber consisting of judges from national courts of the Member States of the Benelux. This will result in a more consistent and harmonious case law. So far, the BCJ only played a role where national courts had doubts as to the interpretation of matters of Benelux law. In the past years this role was not very big, since questions of interpretation of substantive trade mark law were referred to the Court of Justice in Luxembourg (CJEU). So, mainly procedural issues were brought before the BCJ. As before, the BCJ can refer questions of interpretation of Union law to the CJEU.
Revocation and invalidation actions can be brought before the BOIP
The second important novelty concerns the possibility to request revocation or invalidation of the registration of a trade mark in an administrative procedure before the BOIP, just as is the case with EU trade marks, and the new procedure shows similarities with the procedure before EUIPO. This is done in anticipation of implementation of art. 43 and 45 of Directive 2015/2346, the new Trade Marks Directive.
So far, prior rights holders, those who wish to invoke lapse of rights based on non-use or those who wish to argue that a trade mark for example lacks distinctiveness could only do so before the courts. This will still be possible, but the new system offers the alternative of an administrative revocation or invalidation procedure, which can be attractive, since it will involve less costs. Again, appeals from decisions of the BOIP in such administrative proceedings can only be brought before the BCJ.
The new system should be welcomed. Until now it was generally felt that the differences in the decisions of the courts of appeal in the Benelux countries were not acceptable. We can now expect a more consistent case law, the quality of which will probably be very good because the BCJ’s new chamber consists of judges with experience in IP matters. Also, the new administrative revocation and invalidation procedure will be faster and less expensive than court proceedings. It is up to the claiming party to carefully develop a strategy which proceedings would be better in his case.