Henkel KGaA v. OHIM (CFI; T-393/02; 24.11.04)
This was an appeal against OHIM’s decision to refuse to register a 3-Dimensional sign in the shape of a bottle turned on its head (see below). OHIM found that the 3-D sign was devoid of distinctive character under Article 7(1)(b). In a rare decision, the CFI upheld the appeal, holding that the mark was distinctive
The products covered by the mark applied for were everyday consumables; “soaps; washing and bleaching agents for laundry; perfumed flushing water conditioners; chemical preparations for cleaning porcelain, stones, wood, glass, metal and plastics” all in Class 3 and “plastic boxes for liquid, gel and paste agents” in Class 20. The distinctiveness of the mark accordingly had to be assessed having regard to the presumed expectation of an average consumer who is reasonably well informed and reasonably observant and circumspect.
The mark consisted of a combination of elements, each of which was devoid of distinctive character. However, such a sign could be distinctive if it was greater than the sum of its constituent parts. In this case, the combination of the elements of the sign were found to have a truly individual character. Specifically, the bottle in question was particularly angular and its angles, edges and surfaces made it resemble a crystal. In addition, the container gave the impression of being a single object since the stopper formed an integral part of the overall image. Further, the bottle was particularly flat. This combination meant that the bottle in question had a particular and unusual appearance which is likely to attract the attention of the relevant public and would enable them, once familiar with the shape of the bottle in question, to distinguish the goods covered by the registration from those having a different commercial origin. Finally, the CFI held that the colours claimed in the application which were transparent and white, did not affect the distinctiveness of the sign having regard to containers used for similar products.
Own name defence
Anheuser-Busch Inc. v. Budĕjovický Budvar, národní podnik (ECJ; 16.11.04)
The facts of the case were as follows. Anheuser-Busch brought infringement proceedings in Finland, seeking to prevent Budvar from using the marks Budĕjovický Budvar, Budweiser Budvar, Budweiser, Bud and other similar marks in relation to beer. Budvar claimed in its defence that its earlier registrations of trade names in the Czechoslovakian commercial register including, in Czech, Budĕjovický Budvar národní podnik and, in English, Budweiser Budvar National Corporation conferred on it an earlier right under Article 8 of the Paris Convention which protected it against the trade mark infringement action (ie. an own name defence).
Article 8 provides that “A trade name shall be protected in all the countries of the Union without the obligation of filing or registration, whether or not it forms part of a trade mark”. The TRIPs Agreement states that all members comply with, inter alia, Article 8 of the Paris Convention. The Supreme Court in Finland referred various questions to the ECJ relating to the interaction between Article 8 of the Paris Convention and Articles 16 and 17 of TRIPs. Article 16 sets out the exclusive rights conferred on a proprietor by a trade mark registration, but states that they “shall not prejudice any existing prior rights”. Article 17 states that members can provide limited exceptions to the rights in Article 16, “provided that such exceptions take account of the legitimate interests of the owner of the trade mark and of third parties”.
The ECJ held firstly that TRIPs applied to the facts in this case because, although the conflict between Anheuser-Busch’s trade marks and Budvar’s sign started before TRIPs came into force on 1 January 1996, it continued after this date. Secondly, the ECJ held that national law had to interpreted in the light of both the Trade Marks Directive and TRIPs. Although TRIPs did not have direct effect, interpreting national law in the light of TRIPs did not prejudice national or Community law.
In relation to the first of the substantive trade mark law questions, the ECJ pointed to the fact that Article 16 of TRIPs corresponds to Article 5(1) of the Directive. Therefore, following Arsenal Football Club (Case C‑206/01), the ECJ held that Article 16 confers on the proprietor of a trade mark the exclusive right to prevent a third party from using a sign if the use in question prejudices or is liable to prejudice the functions of the trade mark, in particular its essential function of guaranteeing to consumers the origin of the goods. A trade name could constitute such a sign.
The ECJ then considered the exceptions to infringement provided by Article 17 of TRIPs. The court held that the exceptions are intended, inter alia, to enable a third party to use a sign which is identical or similar to a trade mark to indicate his trade name, provided that such use is in accordance with honest practices in industrial or commercial matters.
The court noted that the own name defence is set out in Article 6(1)(a) of the Directive. It further noted that the joint declaration by the Council and the Commission, recorded in the minutes when the Directive was adopted, stated that Article 6(1)(a) only relates to natural persons. The ECJ found that this statement in the declaration had “no legal significance”. Article 6(1)(a) contains no wording limiting it to natural persons and to impute it would considerably restrict the scope of the defence.
Following Gerolsteiner Brunnen (Case C-100/02), the requirement for “honest practice” in Article 6(1) is, in essence, an expression of the duty to act fairly in relation to the legitimate interests of the trade mark proprietor and equates to the same requirement in Article 17 of TRIPs. It was up to the national court to assess whether the condition of “honest practice” was satisfied. In doing so, account should be taken of:
the extent to which the use of the defendant’s trade name is understood by the relevant public, or at least a significant section of that public, as indicating a link between the defendant’s goods and the trade mark proprietor or a person authorised to use the trade mark;
- the extent to which the defendant ought to have been aware of the above; and
- whether the trade mark concerned enjoys a certain reputation in the member state in which it is registered and its protection is sought, from which the defendant might profit in selling his goods.
Finally, the ECJ held that a trade name which was not registered or established by use in the member state in which the trade mark was registered and in which protection against the trade name in question was sought may still be regarded as an existing prior right within the meaning of Article 16(1) of TRIPs. However, the trade name had to be an existing right in that it had to fall within in the substantive and temporal scope of TRIPs and still had to be protected at the time when relied upon by the defendant. Further, the trade mark had to be an existing prior right in that the basis of the right must have arisen at a time prior to the grant of the trade mark. Again, it was for the national court to ascertain the facts. However, the ECJ observed that, in principle, neither Article 16(1) of TRIPs nor Article 8 of the Paris Convention precludes conditions being imposed by the Finnish court relating to minimum use or minimum awareness of the trade name.
Peak Holding AB v. Axolin-Elinor AB(ECJ; 30.11.04)
Peak Holding was the proprietor of the trade mark Peak Performance. The right to use the mark was granted to Peak Performance Production. The company had clothing bearing the mark manufactured outside the EEA, imported those goods into the EEA and offered them for sale in their sister company’s shop in Denmark. Unsold goods were sold to a company called COPAD, established in France, on the basis that they would be sold outside the EEA, with the exception of 5% of the consignment which could be sold in France. The defendant acquired the goods from a third party and advertised them for sale in Sweden. It was common ground between the parties that the goods did not leave the EEA.
The ECJ held that under Article 7(1) of the Directive, goods bearing a trade mark could not be regarded as having been “put on the market” in the EEA (1) where the proprietor of the trade mark had imported them into the EEA with a view to selling them there; or (2) where he offered them for sale to consumers in the EEA, in his own shops or those of an associated company, without actually selling them. Such acts did not transfer to third parties the right to dispose of the goods bearing the mark since the proprietor retained his interest in and control over the goods. Further, the proprietor had not, by such acts, realised the economic value of the mark.
The ECJ also held that, in the circumstances of the proceedings, a prohibition on reselling the goods in the EEA in a contract of sale between the proprietor and an operator established in the EEA, did not mean that there was no putting on the market in the EEA within the meaning of Article 7(1) and thus did not preclude the exhaustion of the proprietor’s exclusive rights in the event of a resale in the EEA in breach of that contract. Following answers (1) and (2) above, the fact that the goods had been put on the market in the EEA, presupposed a sale by the proprietor in the EEA. There was no additional requirement in Article 7(1) making exhaustion of the trade mark rights subject to the proprietor’s consent to further marketing of the goods in the EEA. Since exhaustion occurred solely by virtue of putting on the market in the EEA, any prohibition on resale in the EEA in the contract only affected the relations between the parties and did not preclude exhaustion under the Directive.
Revocation for Non-Use
George Lowden v. The Lowden Guitar Company Ltd(Patten J.;  EWHC 2531 (Ch); 17.11.04)
George Lowden (the “Appellant”) was the proprietor of the stylised mark LOWDEN registered for guitars in Class 15 (the “Mark”). Registration of the Mark had been applied for on 20 October 1994 and completed on 20 October 1995. The Respondent applied for revocation of the Mark from 20 October 1999 on the basis of non-use under sections 46(1)(a) and 46(1)(b ). (It should be noted that, under section 46(1)(a), revocation could not be ordered from a date earlier than 20 October 2000.)
The Appellant’s trade mark attorney filed Form TM8 and the counter-statement outside the time allowed under Rule 31(2). The hearing officer held that under Rule 31(3) the Appellant’s opposition to the application for revocation had therefore been deemed withdrawn. Although the Respondent had informed the Trade Mark Registry that it had made an error in requesting revocation from 20 October 1999, the hearing officer ordered revocation from the date originally sought by the Respondent.
The Appellant appealed on the basis that the Registrar had no jurisdiction to make the order since the hearing officer purported to revoke the Mark from a date earlier than any date permissible under section 46. The Appellant also argued that the decision to revoke the registration of the Mark was taken without exercising the discretion that was required under Rule 31(3) and without giving the Appellant an opportunity to be heard, contrary to Rule 54. The Respondent argued that the court could correct the date in the hearing officer’s decision and order revocation on a basis akin to the slip rule. Additionally the Respondent argued that any discretion given to the hearing officer under Rule 31(3) was narrow and could not be exercised in the Appellant’s favour in the circumstances of this case.
Patten J. held that the inclusion of the 1999 date in the hearing officer’s decision and order was in no way an accidental one of the kind that could be remedied by the slip rule. The inclusion of a date which was not permissible under section 46 was an error of law. The Respondent’s request for a different order from that made by the hearing officer should not be granted on the appeal in order to preserve the benefit of an order for revocation for the Respondent.
Rule 31(3) gives the Registrar discretion as to whether or not to treat the proprietor’s opposition as withdrawn. This decision was made and communicated to the Appellant by letter from the Registry when the counter-statement was not filed on time. The Registrar also has a discretion as to whether or not to accede to the application for revocation. The Registrar therefore had to consider whether the application was one which would not necessarily be granted, even if the alleged non-use was not challenged. He was entitled to look at the material filed out of time by the proprietor and to rely on it so far as it identified reasons which could be pursued even in the light of non-use. The Registrar’s consideration of those issues would entitle the Appellant to a hearing under Rule 54. Had such a hearing taken place the hearing officer would have been bound to allow the application to continue as an opposed application on the point of the revocation date. In a case where the Appellant had, in effect, been debarred from defending the application for revocation on its merits (due to the late filing of his counter-statement) it was not possible for the Registrar to grant permission to amend the application without starting time running again for the service of the counter-statement under Rule 31(2).
It was not open to the court to grant permission to the Respondent to amend its statement of grounds to change 1999 to 2000 without allowing the Appellant the opportunity of serving his counter-statement in time. The order for revocation was set aside and the revocation application remitted to the Registrar to determine the Respondent’s application for amendment of its statement of grounds.
Reporter’s note: I am most grateful to my colleague Clare Wilson for summarising the Henkeland George Lowden decisions.
The ECJ and CFI decisions can be found at http://curia.eu.int/en/content/juris/index_form.htm.