This month we report on the decision of the ECJ in Bild Digital v Präsident des Deutschen Patent- und Markenamts on the relevance of earlier decisions to trade mark applications; and the CFI consider the meaning of “mere local significance” in Alberto Jorge Moreira de Fonseca v OHIM and “genuine use” in Anheuser-Busch v OHIM.  <top> 


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Ref no.  

ECJ
C-513/07
AGC Flat Glass v OHIM
(17.10.08)

Application (and where applicable, earlier mark)  


- patterned glass (except glass used in building), glass sheets (except glass used in building), glass sheets for use in the manufacture of showers, shower walls, shower enclosures, glazing, double glazing, building partitions, building screens, doors, cupboards doors and furniture (21)

Comment  

The ECJ dismissed the appeal against the CFI’s finding that the application for the registration of a figurative mark, consisting of a design applied to the surface of goods, was not registrable on the basis of acquired distinctiveness under Article 7(3).


Flat Glass submitted that the CFI had wrongly applied Article 7(3) since the target public consisted solely of professionals in the glass industry (and this did not include end consumers).  The ECJ rejected this submission as inadmissible, holding that the CFI’s finding in respect of the target public involved findings of a purely factual nature and could not be called into question in the context of an appeal.

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Ref no.  

ECJ
C-81/08
Miguel Cabrera Sánchez v OHIM; Industrias Cárnicas Valle, SA
(13.11.08)
(Decision not yet in English)

Application (and where applicable, earlier mark)  


- meat, fish, poultry and game (29)
- coffee, tea, cocoa, sugar (30)


 



- meat, ham,  cooked meat, cold meet and canned meat (29)
(Spanish national registration)

Comment  

The ECJ upheld the CFI’s decision that there was no likelihood of confusion between the marks under Article 8(1)(b).


The CFI found that there were visual differences between the marks.  The expression “el charcutero” (a type of butcher) was held to be descriptive and considered not to be the dominant element in either mark.  Phonetically and conceptually, the marks were similar in that they included the common expression “el charcutero”.  However, there were also differences due to the addition of the adjective “artesano” in the mark applied for.


The CFI concluded that the visual differences between the conflicting marks were more important than the weak phonetic and conceptual similarities. This finding was contested by Miguel Cabrera Sánchez in its appeal to the ECJ. However, the ECJ refused to rule on the point, being an issue involving findings of a factual nature. As a result, the ECJ dismissed the appeal and upheld the decision of the CFI.

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Ref no.  

ECJ
C-197/07
Aktieselskabet af 21. November 2001 v OHIM; TDK Kabushiki Kaisha (TDK Corp.)
(12.12.08)

Application (and where applicable, earlier mark)  

TDK
- clothing, footwear, headgear (25)
TDK



- apparatus for recording transmission or reproduction of sounds or images (9)
(1 CTM; 35 national trade marks)

Comment  

The ECJ dismissed the appeal from the CFI’s decision allowing the opposition under Article 8(5) as partly inadmissible and partly unfounded.


Aktieselskabet’s submission alleging lack of support for the finding of the earlier mark’s reputation was inadmissible. Aktieselskabet was attempting to obtain a re-examination of the CFI’s factual assessment without alleging distortion of facts or evidence.


Aktieselskabet’s submission that the CFI had erred by finding that the use of the mark applied for would take unfair advantage of the distinctive character or reputation of the earlier marks was unfounded. Aktieselskabet submitted that the CFI had erred by (i) basing its conclusion on the notion of a ‘reputation’ rather than a ‘repute’ as required by Article 8(5) and that there was a difference in the legal meaning of the two terms; and (ii) automatically inferring the existence of probable unfair advantage merely from the fact that the earlier mark had a reputation and was identical/similar to the mark applied for.


With regard to (i) the ECJ concluded that, even if there was a difference, the CFI correctly established the existence of an unfair advantage.  With regard to (ii) the ECJ noted that, following Intel v CPM (C-252/07), it was not necessary to demonstrate actual and present injury to an earlier mark; it was sufficient to show that there was a risk, of unfair advantage or detriment in the future.

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Ref no.  

ECJ
C-320/07
Antartica Srl v OHIM; The Nasdaq Stock Market, Inc.
12.03.09)

Application (and where applicable, earlier mark)  


- protective helmets for sports (9)
- bicycles (12)
- sports clocks and  chronometers (14)
- sports clothes (25)
- skis, snowboards (28)
NASDAQ
- various stock exchange price services and financial services (9, 16, 35, 36, 38, 42)

Comment  

The ECJ upheld the CFI’s decision that Antartica’s mark infringed Article 8(5) by taking advantage of or being detrimental to the reputation of Nasdaq’s earlier mark.


The CFI was right to hold that use of the NASDAQ mark in connection with the Nasdaq indices (a stock exchange price quotation service) constituted use of the NASDAQ mark as regards the services in Classes 35 and 36 for the purposes of establishing a reputation under Article 8(5). It was not relevant that these services were offered free of charge: Nasdaq was a commercial company that sought to maintain an outlet for services under the NASDAQ mark.


Following Intel v CPM (C-252/07), when asserting unfair advantage under Article 8(5), it was necessary to consider the average consumers of the goods/services of the mark applied for. The CFI had not erred because it had included such consumers in its assessment. The CFI had found that the omnipresence in the press (both specialist and general) and the interest of a large part of the general public in financial markets meant that the reputation of the earlier mark went further than the professional public specialising in financial information and encompassed the general public, i.e. the average consumer of the goods and services covered by the mark applied for.


The application to register Antartica’s mark was therefore contrary to Article 8(5).

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Ref no.  

ECJ
C-21/08
Sunplus Technology Co. Ltd v OHIM; Sun Microsystems, Inc.
(26.03.09)

Application (and where applicable, earlier mark)  


- various chips, circuits and computer goods (9)
SUN
- various computer accessories and software goods (9)
(Benelux registration)

Comment  

The ECJ upheld the CFI’s decision that there was a likelihood of confusion between the two marks under Article 8(1)(b).


The ECJ dismissed parts of Sunplus’ appeal as inadmissible as they dealt with the CFI’s finding of fact (namely the visual, phonetic and conceptual comparison) rather than a finding of law.  There was no evidence that the CFI had distorted the facts.


The CFI did not err in its decision that the BoA was fully entitled to find a likelihood of confusion, based on the high degree of similarity (or even identity) between the goods and the phonetic and conceptual similarities between the two marks. In order to reach this conclusion, the CFI had correctly carried out a full analysis of the overall impression produced by the marks and had applied a global assessment as to the likelihood of confusion between them.

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Ref no.  

CFI
T-168/07
Professional Tennis Registry, Inc. v OHIM; Registro Profesional de Tenis, SL
(04.03.09)

Application (and where applicable, earlier mark)  


- various goods in Classes 16, 25 and 41



- various goods in Classes 25, 28 and 41



- various goods in Class 41

Comment  

The CFI allowed PTR’s appeal and annulled the BoA’s decision which in turn had allowed the opposition under Article 8(1)(b).


The BoA erred in finding visual similarity between the marks. Despite the similarity in the structure of the marks, the CFI noted differences as regards the size, position and form of the figurative elements and the size, stylisation and order of the letters of the acronyms and words. As regards the application, the CFI held that the target public’s attention would be drawn to the association between the PTR acronym and the figurative element, thus making this combination the distinctive and dominant element of the mark. The CFI found that the acronym was the dominant element of the earlier marks.


The BoA was wrong to conclude that there was phonetic similarity between the marks. The average consumer would refer to the marks solely by their acronyms, which were different in that the letters were ordered differently, they did not contain a vowel (so must be pronounced separately), and comprised consonants (which have a distinct sound in many languages).


Although the marks were conceptually similar (since the word expressions referred to the same concept, tennis), overall the visual and phonetic differences between the marks cancelled out any conceptual similarity. Thus there was no likelihood of confusion.

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Ref no.  

CFI
T-8/08
Piccoli  v OHIM
(10.03.09)
(Decision not yet in English)

Application (and where applicable, earlier mark)  


- brioches, brioches filled with creams or custards, jams, chocolate or honey  (30)

Comment  

The CFI dismissed the action, upholding the BoA’s decision that the mark was not inherently distinctive under Article 7(1)(b), and that it had not acquired sufficient distinctive character under Article 7(3).


The relevant consumers of baked patisseries were the general public, whose members did not habitually perceive the origin of products on the basis of their shape, or the shape of their packaging. On the evidence, numerous baked patisseries such as empanadas, madeleines and sfogliatelle have a domed shape that flattens out at the edges.  This was a normal shape for such goods and was also often reminiscent of shells. Although no such goods had previously been in the precise form of a coquille Saint-Jacques, this was a simple variant and not sufficient to hold the attention of the public or allow it to distinguish the commercial origin of the goods.


Piccoli submitted that its proof of acquired distinctiveness in Italy should permit registration. This was rejected on the basis that the impression the 3D mark would make on the consumer would be the same throughout the Community, meaning the mark lacked distinctiveness as regards the whole EC. The applicant therefore needed to show acquired distinctiveness in the entire Community to obtain registration under Article 7(3) (which it had not).

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Ref no.  

CFI
T-109/07
L’Oréal SA v OHIM; Spa Monopole, compagnie fermière de Spa SA/NV
(25.03.09)

Application (and where applicable, earlier mark)  

SPA THERAPY
- various perfumes, cosmetics and toiletries (3)


SPA
- bleaching preparations and other substances for laundry use, cleaning, polishing, scouring and abrasive preparations, soaps, perfumery, essential oils, cosmetics, hair lotions, toothpastes (3)

Comment  

The CFI upheld the BoA’s decision that there was a likelihood of confusion between the two marks under Article 8(1)(b).


The differences between the marks as a result of the addition of the word ‘therapy’ in the mark applied for was not such as to outweigh the similarities resulting from the presence of the earlier SPA mark at the beginning of the mark applied for and from the independent distinctive role it has there.


The CFI noted that the word ‘therapy’ was not a widely-known commercial term; but a term which, although not descriptive of cosmetic products, did not have a particularly strong distinctive character with respect to those goods.  Furthermore, cosmetic manufacturers frequently rolled out several lines of products under different sub-brands.  Therefore, the addition of the word ‘therapy’ could lead customers to believe that the mark applied for related to a line of products marketed by Spa Monopole.

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Ref no.  

CFI
T-21/07
L’Oréal SA v OHIM; Spa Monopole, compagnie fermière de Spa SA/NV
(25.03.09)

Application (and where applicable, earlier mark)  

SPALINE
- bath and shower soaps, skin moisturisers, body lotions, skin toners, astringents, skin and body cleansers, facial masks, scrubs and fragrance products namely perfumes, colognes, eau de toilette and oils (3)


SPA
- mineral water and aerated waters and other non-alcoholic beverages, syrups and other preparations to make beverages (32)

Comment  

The CFI dismissed the appeal against the BoA’s decision to allow the opposition under Article 8(5).


The reputation of the earlier mark for mineral water was not in dispute.  The CFI concluded that there was a similarity between the relevant marks.  The additional element ‘line’ in the mark applied for did not distinguish the marks.  The CFI noted that the word ‘line’ when used for cosmetics, often referred to a range of products. Therefore, rather than distinguishing the marks, the addition of this word helped to establish a conceptual link. The CFI concluded that the relevant public was liable to establish a link between the marks, bearing in mind both marks targeted the same public and the goods they covered were similar.  Thermal waters and cosmetic products can be used in conjunction with skin and beauty treatments and mineral waters and their mineral salts can be used in the production of soaps and other cosmetic products.


The image of the earlier mark and the message that it conveyed (relating to health, beauty, purity and mineral richness) could also apply to goods covered by the mark applied for and therefore L’Oréal could take unfair advantage of the image of, and message conveyed by, the earlier mark. Accordingly, the risk of a free-riding transfer of the advertising effort of Spa Monopole had been established.  The CFI did not refer to the Intel case in its decision.

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Relevance of earlier decisions to trade mark applications


Bild digital GmbH & Co. KG and ZVS Zeitungsvertrieb Stuttgart GmbH  v Präsident des Deutschen Patent- und Markenamts (ECJ (Sixth Chamber); Joined cases C-39/08 and C-43/08; 12.02.09) (Decision not yet in English)


The ECJ has responded to various questions referred by the German Federal Patent Court in joined cases C-39/08 and C-43/08 concerning the extent to which national trade mark authorities should take into account their own decision-making practice. The ECJ ruled that, though an authority should take into consideration previous decisions in similar cases, it is not by any means bound by those decisions.


In C-39/08, the German Patent Office had refused to register Bild digital’s applications for VOLKS.HANDY, VOLKS.CAMCORDER and VOLKS.KREDIT, whereas the Office has previously granted registrations to Bild digital for similarly composed signs in respect of comparable products and services.


The mark refused in C-43/08 was SCHWABENPOST, despite similar signs composed of the material indication ‘Post’ and a geographical indication (such as ‘Schwaben’, here) having been registered by the Office for the same services in the name of one of ZVS’s competitors.


In C-39/08, the German Court asked whether Article 3 of Directive 89/104 required identical or similar trade mark applications to be treated in the same way. If so, should the national court (i) investigate unequal treatment and, in so doing, take into account earlier decisions of the competent authority in similar cases; and (ii) take into account the prohibition of discrimination having the effect of distorting competition when interpreting and applying Article 3 if it has established discrimination of that nature? If not, should national legislation provide that a national authority be obliged to initiate ex officio cancellation proceedings against marks which have previously been wrongly registered?


The questions referred in C-43/08 were identical, save that the first question was whether Article 3 required equal treatment, with regard to the registration of trade marks, of applicants in competition with one another in order to safeguard equality of opportunity in matters of competition.


The ECJ referred to various decisions (e.g. BioID C-37/03) in which it had ruled that an application to register a CTM should be assessed by the competent authority solely on the basis of the Community legislation and should not be dependent on its previous decision making practice. The fact that a mark has been registered in one Member State for certain products and services is of no relevance in determining if a similar mark should be registered in another Member State (Koninklijke C-363/99). These principles applied equally to applications to register a mark within a Member State where the previous registration of a similar or identical mark is invoked in support.


The ECJ noted that the principle of equality had to be reconciled with the principle of legality. No one could invoke a legally incorrect decision committed in favour of another in order to obtain an identical decision in its own favour.


The ECJ therefore responded that the competent authority is not required to set aside the absolute grounds for refusal contained in Articles 3(1)(b) and (c) to allow registration of a sign on the basis that the sign is composed in a similar or identical manner to one which has previously been registered in respect of identical or similar goods or services.


The ECJ declined to answer the question concerning ex officio cancellation proceedings, as it considered the interpretation of Community law requested in that question manifestly did not relate to the subject of the originating cases (that subject being the challenge of refusals by the German Patent Office to register the marks concerned).


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Trade mark infringement by an intermediary


UDV North America Inc. v Brandtraders NV (AG Colomer for the ECJ; C-62/08; 19.02.09) (Decision not yet in English)


UDV owns the CTM, SMIRNOFF ICE, registered for alcoholic drinks in particular distilled spirits and liqueurs in Class 33.  Brandtraders operated a website in which companies who were members of the site could anonymously place advertisements as buyers or sellers and negotiate deals.  Brandtraders would then enter into a contract in its name with the buyer for a commission fee as the agent of the seller.  Bottles of Smirnoff Ice were offered for sale on Brandtraders’ website.  UDV commenced an action in the Belgian Court for trade mark infringement.


The Belgian Court made a reference to the ECJ asking, firstly, whether for there to be use of a sign under Articles 9(1)(a) and (2)(d) it was necessary that a third party used the sign on its own behalf or whether it was sufficient that a third party used the sign as an interested party in the trade of goods in which it was a contractual party.  Secondly, the Belgian Court asked whether a trade intermediary acting in its own name, but not on its own behalf, could be regarded as a third party using the sign within the meaning of Articles 9(1)(a) and (2)(d).


The AG examined the use of the SMIRNOFF ICE sign on Brandtraders’ business papers, in particular in a letter from Brandtraders confirming the terms of agreement between the buyer and seller and an invoice sent from Brandtraders to the buyer.  This use had been found by the Belgian court to have taken place in the EC even if the merchandise was not necessarily in the territory of the EC.


The AG concluded that the concept of “use” under Article 9(1)(a) and (2)(d) included a situation in which a commercial intermediary, acting in its own name but on behalf of a seller and being an interested party in the trade of merchandise, used on its business papers a sign identical to a CTM in respect of products identical to those in relation to which the CTM was registered.


The AG found that the following four conditions derived from Céline (C-17/06) were clearly satisfied: 


  1. The use of the sign was not authorised by UDV.
  2. As Brandtraders had been involved in the sale of the Smirnoff Ice bottles and received commission for this involvement, the use had been in the course of trade, regardless of the fact that Brandtraders had acted as an agent.
  3. Brandtraders’ use of the CTM on its business papers would establish a link between the sign and the products in question constituting a use in respect of goods under Article 9(1)(a).  Once this link was established, it was irrelevant that Brandtraders had used an identical sign to market products to which it never acquired title.
  4. Such use could be interpreted as designating Brandtraders as the undertaking from which the goods originated.  This constituted a use of the CTM as a mark and it was unimportant that Brandtraders’ use was in the context of marketing products for and owned by another company.

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Bad faith


Chocoladefabriken Lindt & Sprungli AG v Franz Hauswirth GmbH (AG Sharpston for the ECJ; C-529/07; 12.03.09)


Lindt has produced and marketed chocolate Easter bunnies since the early 1950s, although their exact presentation has varied slightly.  On 5 July 2001, its application for a three dimensional CTM in the shape of a bunny wrapped in gold-coloured foil with red and brown markings wearing a red ribbon and bell around its neck and ‘Lindt Goldhase’ stamped on its haunch (reproduced below) was registered.


Hauswirth has produced and marketed chocolate bunnies since 1962, decorated with a ribbon but not a bell and with the label affixed to the underside (also reproduced below).


    >>>  
              Lindt                               Hauswirth


After registering the mark, Lindt brought trade mark infringement proceedings in the Austrian Court against Hauswirth on the grounds that the latter’s product was confusingly similar to the registered trade mark.  Hauswirth counterclaimed inter alia that the registration was in bad faith and should be declared invalid in accordance with Article 51(1)(b).


The Austrian Court held that there was a likelihood of confusion between Lindt’s and Hauswirth’s products.  Further, it found that by registering the mark, Lindt wanted to create a basis for taking proceedings against other manufacturers’ products to the extent that there was any likelihood of confusion.


The three questions referred by the Austrian Court to the ECJ asked for clarification of the factors that were necessary and/or sufficient to establish that one of a number of competing undertakings marketing similar products was acting in bad faith when it applied to register a trade mark.


The questions were considered together, the AG making the initial observation that ‘bad faith’ was not defined, delimited or described in any way in the relevant legislation, but that guidance could be derived from its place in that legislation.  Bad faith was an inherent defect in an application that fundamentally vitiated the registration regardless of other circumstances.


The AG considered that bad faith could not be confined to a limited category of specific circumstances such as the existence of a particular kind of prior right, a lack of intention to use the mark or actual or constructive knowledge of the existing use of a similar mark.  Whether bad faith existed had to be assessed by taking into account all the available evidence of the relevant circumstances.


The AG concluded that there is no simple, decisive test for establishing whether a trade mark application was submitted in bad faith. Bad faith is a subjective state, being an intention incompatible with accepted standards of honest or ethical conduct in the relevant factual context.  Such subjective state is ascertainable from objective evidence, and must be assessed on a case by case basis. It requires, at least, knowledge of the circumstances from which incompatibility with accepted standards of honest or ethical conduct might be deduced.


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Implicit withdrawal of a CTM application


Laytoncrest Ltd v OHIM; Erico International Corp. (CFI (Third Chamber); T-171/06; 17.03.09)


Laytoncrest filed an application for a CTM for the word sign TRENTON for goods and services in Classes 7, 9 and 11.  Erico International Corp opposed the registration under Article 8(1)(b), relying on its earlier mark, LENTON, registered for goods and services in Classes 6 and 7.


Laytoncrest did not file any observations but the Opposition Division rejected the opposition; Erico appealed claiming infringement of Article 8(1)(b) and, given Laytoncrest’s complete procedural inactivity, that it effectively did not exist.


Laytoncrest again did not submit any observations.  The BoA held that under Article 44(1), which allows an applicant to withdraw its application, Laytoncrest had implicitly withdrawn its application.


The CFI first found that, even if the BoA was entitled to find that Laytoncrest’s procedural inactivity was capable of demonstrating that it had lost interest in, and therefore had implicitly withdrawn, its application, (i) Article 73 required the decision to be based on reasons on which the parties concerned had an opportunity to present their comments; and (ii) Rule 54 of Regulation 2868/95 required that the loss of any rights resulting from Regulation 40/94 or 2868/95 had to be communicated to the person concerned giving him two months to apply for a decision on the matter by OHIM.  Both these safeguards had been breached and therefore the BoA’s decision should be annulled.


Further, Storck v OHIM (Shape of a sweet) (T-396/02) and Ellos v OHIM (ELLOS) (T-219/00) made it clear that a withdrawal of the whole or part of a CTM under Article 44(1) had to be made expressly and unconditionally.  Implicit withdrawal could not be inferred from an Applicant’s procedural inactivity during opposition proceedings.


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Mere local significance


Alberto Jorge Moreira de Fonseca, Lda v OHIM; General Óptica, SA (CFI (Second Chamber); Joined Cases; T-318/06 to T-321/06; 24.03.09)


General Óptica SA owned four figurative CTMs, all being similar in that they included the words GENERAL OPTICA and 3 interlocking rings contained in a box (one of the marks is reproduced below). The CTMs were registered for opticians’ services in Class 42.



Alberto Jorge Moreira de Fonseca (the Applicant) applied to invalidate the four marks under Articles 52(1)(c) and 8(4) on the basis of its earlier Portuguese business establishment namely, Generalóptica, registered for the import and sale of optical precision and photographic apparatus.


OHIM rejected the application on the basis that the Applicant had not proved in respect of the earlier sign (i) genuine use; and (ii) use of more than mere local significance.  The BoA rejected the Applicant’s appeal and the Applicant appealed to the CFI, which also rejected the appeal.


The CFI noted that under Article 52(1)(c) (in conjunction with Article 8(4)) the existence of a sign other than a mark makes it possible to invalidate a CTM if that sign fulfils all four of the following conditions:



(i) the sign must be used in the course of trade;
(ii) it must be of more than mere local significance;
(iii) the right to that sign must have been acquired in accordance with the law of the Member State in which the sign was used prior to the application for registration of the CTM; and
(iv) the sign must confer on the proprietor the right to prohibit the use of a subsequent trade mark.


The first two conditions must be interpreted in the light of CTM law, and the second two in light of the criteria set by the law governing the signs relied on.


The rational of condition (ii) was to restrict the number of conflicts between signs by preventing an earlier sign, which was neither important nor significant, from being capable of challenging a CTM.  The significance of a sign must be established in relation to the identifying function of that sign, taking into account:



(a) The geographical dimension of the sign’s significance (i.e., the territory in which it was used to identify the proprietor’s economic activity).  It was necessary to establish that, through use, the sign relied on had acquired a significance which was not restricted to a small part of the relevant territory.


(b) The economic dimension of the sign’s significance which was assessed in light of the length of time in which it had fulfilled its function, the degree to which it had been used, the group of addresses among which the sign in question had become known as a distinctive element (consumers, competitive suppliers) or even exposure given to the sign e.g., through advertising or on the internet.


The choice of how more than mere local significance is proved is open to the applicant.  The CFI noted that this could be established by the existence of a network of economically active branches throughout the relevant territory, but also more simply, for example, by producing invoices issued outside the region in which it has its principle place of business, press cuttings showing the degree of recognition on the part of the public of the sign relied on or by establishing that there were references to the business establishment in travel guides.


The CFI concluded that the Generalóptica name was not a sign of more than mere local significance.  At the relevant time the sign had been used for nearly 10 years to designate a business establishment in a Portuguese town which had 120,000 inhabitants.  There was no evidence of recognition of the sign by consumers or of its business relationships outside of that town, nor was it shown that any advertising activity had been developed to promote the name outside of that town.


Given that conditions (i) to (iv) were cumulative the CFI did not need to examine whether the sign had been used in the course of trade.


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Discretion to take into account new evidence


Kaul GmbH v OHIM; Bayer AG (CFI (Fifth Chamber); T-402/07; 25.03.08)


Atlantic Richfield applied to register the mark ARCOL for, inter alia, chemical substances for preserving foodstuffs in Class 1.  The application was subsequently transferred to Bayer.  Kaul opposed the application under Article 8(1)(b) on the basis of its earlier CTM, CAPOL, registered for chemical preparations for keeping fresh and preserving food stuffs, namely raw materials for soothing and preserving prepared food products, in particular confectionary in Class 1.


The Opposition Division rejected the opposition on the basis that there was no likelihood of confusion between the two marks since they were visually and phonetically different.  Kaul appealed to the BoA, claiming that its mark had a highly distinctive character and, as such, should benefit from increased protection.


In dismissing the appeal, the Third BoA concluded that it could not take into account the mark’s supposedly distinctive character because the evidence to substantiate it was introduced for the first time at the appeal.  Kaul then appealed to the CFI on four grounds, including an alleged breach by the BoA of an obligation to examine evidence adduced before it.  The CFI annulled the BoA’s decision (T-164/02), concluding that, by refusing to consider the factual evidence adduced by Kaul in order to prove the highly distinctive character, the BoA had infringed Article 74.  The CFI did not consider Kaul’s other grounds of appeal.  OHIM then appealed to the ECJ (C-29/05) which held that the CFI’s judgment should be set aside and also ruled that the BoA’s decision should be annulled.  The ECJ reasoned that the BoA’s refusal to take into account the new evidence on the basis that it was automatically precluded infringed Article 74.  Article 74 grants the BoA discretion as to whether or not to take into account such evidence and therefore the BoA was wrong to consider itself lacking any discretion.  The case was re-allocated to the Second BoA, which upheld the Opposition Division’s decision that the marks were not similar and concluded that the new evidence Kaul was seeking to adduce was irrelevant as it could not have any bearing on Article 8(1)(b).  Kaul appealed to the CFI (this decision), which rejected the appeal on all three grounds raised by Kaul.


In respect of Kaul’s submission that the Second BoA had failed to exercise correctly its discretion under Article 74(2), the CFI concluded that the Second BoA was not called upon to rule on the Third BoA’s decision, but only to rule on Kaul’s appeal against the Opposition Division’s decision.  Having found that there was no similarity between the two marks, the Second BoA was not bound to take into consideration the supposed well-known character of the mark since it was properly entitled to conclude that there was no likelihood of confusion, whatever the distinctive character of the earlier mark.


The relevance of the evidence submitted out of time was one of the factors which OHIM had to take into account when exercising its discretion under Article 74(2).  Even if the Second BoA’s refusal to take the new evidence into account was an error of law, such an error had no effect on the operative part of the decision that the marks were neither similar nor identical.


In respect of Kaul’s submission that the Second BoA had infringed Articles 61(2) and 73 by failing to give Kaul the right to be heard, the CFI concluded that the right extends to the matters of law which form the basis of the decision; the facts and evidence concerning the well-known character of the earlier mark were not part of the basis of the contested decision and therefore the Second BoA was not bound to hear Kaul on this.


  • The CFI also dismissed Kaul’s final submission, alleging infringement of Article 8(1)(b), on a number of counts.  In particular the CFI held that:
  • The fact that the two marks have the same number of letters is not of any particular significance.  In general, the public is not aware of the number of letters in a word mark.
  • The marks were not visually similar; although the ending ‘ol’ was a common element, each mark was preceded by a completely different group of letters.
  • Whatever the exact pronunciation of the marks, there was no phonetic similarity due to the considerable differences between the initial group of three letters.
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Genuine use


Anheuser-Busch, Inc. v OHIM; Budějovický Budvar, národní podnik (CFI (First Chamber); T-191/07; 25.03.09)


Anheuser-Busch applied to register the mark BUWEISER as a CTM for ‘beer, ale, porter, malted alcohol and non-alcoholic beverages’ in Class 32.  Budějovický Budvar, národní podnik (Budvar) opposed the application under, inter alia, Articles 8(1)(a) and 8(1)(b) relying on three international marks, including one word mark BUDWEISER and one figurative mark reproduced below, registered for beer.



The Opposition Division considered that proof of use of the word mark was insufficient and limited itself to review of the figurative mark, concluding that there was a likelihood of confusion under Article 8(1)(b) thus allowing the opposition.


Anheuser-Busch appealed to the BoA which concluded that genuine use had been made out in relation to the word mark and therefore the opposition could be upheld in relation to this mark under Articles 8(1)(a) and (b).


Anheuser-Busch appealed to the CFI, submitting, amongst other things, infringement of Articles 43(2) and (3), in that the evidence was provided by Budvar was insufficient to prove genuine use of the word mark.


In dismissing Anheuser-Busch’s appeal, the CFI noted the following principles for assessing whether use of a trade mark was genuine (relying on Il Ponte Finanziaria (C-234/06), Silk Cocoon (T-174/01), Charlott France Entre Luxe et Tradition (T-169/06), VITAFRUIT (T-203/02) and La Mer Technology (C-259/02)):


  • There is genuine use where the mark is used in accordance with its essential function, which is to guarantee the identity of the origin of the goods/services.
  • Genuine use does not include token use for the sole purpose of preserving the rights conferred by the registration.
  • Genuine use requires that the mark, as protected in the relevant territory, be used publically and externally.
  • Account must be taken of the commercial volume of the overall use, as well as of the length of period and frequency of use.
  • The question whether use is sufficient to maintain or create market share of the goods or services protected by the mark thus depends on several factors and on a case-by-case assessment.  The characteristics of those goods and services, the frequency or regularity of the use of the trade mark, whether the mark is used for the purpose of marketing all the identical goods or services of the proprietor or merely some of them, or evidence of use which the proprietor is able to provide, are among the factors which may be taken into account. 
  • Even minimal use by a single importer in the Member State concerned may be sufficient if the use serves a real commercial purpose.

The CFI concluded that the nature of the use of Budvar’s word mark was sufficiently clear from the evidence of use in Germany and Austria by means of advertisement in newspapers and magazines. 


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COUNTERFEITING


Market trader fails to establish defence


Essex Trading Standards v Wallati Singh (Goldring LJ and Sweeney J; [2009] EWHC 520 (Admin); 03.03.09)


The Respondent, Mr Wallati Singh, was acquitted by the Magistrates’ Court of possession of goods in the course of trade bearing a sign likely to be mistaken for a registered trade mark contrary to Section 92(1)(c) on the basis that the defence under Section 92(5) applied, namely that he had reasonable grounds for believing that the sign did not infringe the registered mark. The Divisional Court allowed the appeal, holding that the defence had not been made out, and remitted the case back the Magistrates’ Court with a direction that they convict the Respondent.


The Respondent had been looking after a market stall run by a friend, Mr Hooper, whom he had known for 20 years. Mr Hooper had a serious drug problem and was too unwell to run the stall on the day in question. The counterfeit goods consisted of 392 pairs of trainers bearing the Nike logo and 15 pairs of trainers bearing the BAPE logo.


The Magistrates’ Court held that the elements of the offence under Section 92(1)(c) were established but that the Respondent had a defence under Section 92(5) since: (i) he had asked Mr Hooper if the goods were genuine and was told that they were, their cheap price being the consequence of their being clearance stock; (ii) this evidence was corroborated by Mr Hooper in interviews shortly after the incident, without the opportunity for the parties to collude; and (iii) the Respondent had no experience selling sports shoes and would not have recognised the goods as being counterfeit.


The authorities established that the Respondent had to be treated as having been aware of the existence of the registered trade marks. The issue was whether he had discharged the burden upon him under Section 92(5). The Divisional Court held that the evidence fell far short of doing this. The goods were taken to the market in a van which was not Mr Hooper’s and the Respondent knew their price was low. Further, the sole basis for his professed belief was the word of a drug addict, who was unwell at the time. The Respondent had not sought any independent evidence, such as documentation, relating to the provenance and supply of the goods.


The Divisional Court held that the Magistrates failed to have regard to both elements referred to in R v Johnston ([2003] 3 All ER 884): it was not enough to conclude that the Respondent had acted honestly; he must have acted reasonably as well. While his good character could be taken into account in deciding whether or not he was acting honestly, this was irrelevant in deciding whether the grounds upon which he relied were reasonable. The Divisional Court concluded that no reasonable bench could have decided as this bench did.


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DOMAIN NAMES


Galileo Lebensmittel GmbH & Co. KG v Commission of the European Communities (ECJ (Sixth Chamber); C-483/07 P; 17/02/2009) (Decision not yet in English)


Galileo was an exclusive licensee of the German word mark GALILEO owned by its parent holding company, IFD Italian Food Distribution.  Galileo had applied to register the domain name ‘galileo.eu’ under Article 10 of Regulation 874/2004 under which holders of prior rights including trade marks were eligible to apply to register domain names during a period of phased registration before general registration of the .eu domain.


Galileo’s application was rejected by EURid, the registry for .eu, on the grounds that the ‘galileo.eu’ domain name had been reserved by the Commission under Article 9 of Regulation 874/2004 for use by a European Community body before the period of phased registration.


The CFI rejected Galileo’s appeal to annul the Commission’s reservation of the domain name ‘galileo.eu’ on the basis that Galileo’s claim was inadmissible as Galileo was not individually concerned by the Commission’s decision, as required by Article 230 EC. Galileo appealed to the ECJ.


The ECJ dismissed Galileo’s appeal on the following grounds:



(i) As Galileo was not an addressee of the Commission’s decision, the CFI had correctly applied the case law relating to the concept of individual concern to determine whether Galileo had sufficient standing under Article 230 EC.


(ii) The CFI had not erred in finding that Galileo was not individually concerned by the Commission’s decision as it did not form part of a ‘limited class of traders which were affected by the Commission’s decision’ as required by earlier case law.  Even if Galileo had suffered economic damage, this alone would not be sufficient to demonstrate that Galileo was individually concerned.  Furthermore Regulation 874/2004 did not contain any procedural safeguards which owners of prior rights could use to base claims that they are “individually” concerned by decisions of the Commission under Article 10.


(iii) As Galileo had failed to establish that it was individually concerned by the Commission’s decision, it had no basis to maintain that the CFI’s decision affected its right to legal protection.


 


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COPYRIGHT


Crosstown Music Company 1, LLC v Rive Droite Music Ltd, Mark Taylor and Paul Barry* (Mann J; [2009] EWCA 600 (Ch); 25.03.09)


Mark Taylor and Paul Barry (the Writers) assigned their copyright in 119 songs to Rive Droite under a number of agreements (the Agreements) so that the copyright could be exploited and royalties generated. Subsequently Rive Droite sold its rights to Crosstown.  The Agreements provided, in Clause 18(a), that, if Rive Droite were in material breach of the terms of the Agreements and failed to remedy the breach within 45 days (in Talyor’s case) or 60 days (in Barry’s case) of receiving a cure notice “all rights assigned to [Rive Droite] shall forthwith revert to the Writer”.


The immediate prompt for the action was two cure notices, dated 4 April 2007, served by the Writers on Rive Droite and copied to Crosstown. The notices claimed that Rive Droite had breached the Agreements by failing to account for royalties and remedy deficiencies identified in two audit reports.


In response, Crosstown issued proceedings against Rive Droite for specific performance of the sale agreement and against the Writers denying that the cure notices were valid and seeking a declaration that the rights had not reverted to the Writers.


Crosstown maintained that Clause 18(a) merely conferred a contractual obligation upon Rive Droite to hand back the rights if certain circumstances arose. As Crosstown was not a contracting party to the original Agreements, it claimed it was not bound. Mann J rejected the argument and held that the Clause did not provide an agreement to reassign but an automatic reversion binding on subsequent assignees.


In the final speech, Crosstown’s representative tried to argue that an automatic reversion which brought about an assignment may be ineffective in foreign countries and that the judge did not have capacity to deal with such issues of foreign copyright ownership. Mann J refused to allow Crosstown’s submission that the effect of Clause 18 might be different in relation to different national copyright since both parties had approached the trial on the footing that all copyright would be treated alike. The case was therefore decided with no distinction being drawn between English and other copyrights.


Mann J considered that a material breach was not necessarily one that went to the root of the contract; it included a breach that was significant, as opposed to trivial, and had to be measured in context. Mann J held that a number of breaches identified in the cure notices were material.


Finally, Mann J held that Clause 18(a) did not did not provide for an election which had to be exercised within any time limit, whether as a result of an implied term or any separate legal doctrine. By continuing the Agreements, while giving Rive Droite notice of and the opportunity to remedy material breaches, the Writers could not be said to be acquiescing to the breaches or electing to waive the right to a reversion. The Writers had not represented that Clause 18 would not be relied upon. In fact, their whole pattern of conduct demonstrated plainly that they would rely on the clause where they wished to get compliance with the Agreements. In conclusion, Mann J found that Crosstown’s attacks on the validity of the Writers’ cure notices were unsupported and that the notices were valid. The copyright had therefore reverted to the Writers.


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CONFIDENTIAL INFORMATION


High Court continues injunction to prevent publication of confidential documents


Barclays Bank PLC v Guardian News and Media Ltd* (Blake J; [2009] EWHC 591 (QB); 19.03.09)


The High Court has upheld a temporary injunction against Guardian News and Media (the Guardian) preventing the publication of confidential documents relating to a tax avoidance scheme proposed to be put in place by Barclays between 2005 and 2007.


The Guardian obtained the documents from Vincent Cable, MP, to whom the documents were leaked in breach of confidence by an employee of Barclays. The documents contained both confidential commercial secrets and legal advice.


The documents were published in full on the Guardian’s website for approximately four hours on 16 March 2009 before Ouseley J granted a temporary injunction requiring them to be removed and preventing disclosure to any third party. There was some evidence that the documents had since been published by another source, which appeared to have obtained them from the Guardian’s website during the four hour period for which they were made available.


The Guardian accepted that it was obvious that the documents had been disclosed in breach of confidence and that they contained references to advice protected by legal professional privilege. However, it argued that the level of dissemination which had already occurred removed any confidentiality in the documents. Furthermore, it submitted that its right to freedom of expression was engaged pursuant to Section 12(3) and (4) of the Human Rights Act 1998, asserting that there was considerable public interest in the financial arrangements of major banks.


Blake J first considered whether confidentiality continued to exist. Although general publication on the internet may well destroy confidentiality this was not always the case; very limited dissemination, e.g. on a remote or expert site that required a great deal of effort to access, may not result in such a loss of confidentiality. The conclusion depended on the particular circumstances of each case. Blake J held that Barclays had a sufficiently realistic chance of persuading a trial court that the dissemination to date had not destroyed confidentiality. Blake J was reluctant to permit the Guardian to rely on publication by others where the further availability of the documents was caused by the initial wrongful publication by the Guardian.


In considering Section 12 and proportionality, Blake J accepted that the Court has a duty to protect and promote freedom of speech; however this did not mean that journalists should have complete freedom to publish in full documents leaked in breach of a fiduciary duty. It was possible for legitimate debate to be conducted through articles which made use of the documents’ content (and even selective quotations) without publishing them in full or in part. Furthermore, permitting journalists to publish documents subject to legal professional privilege would rapidly erode the principle, allowing journalists to achieve what other interested parties or indeed opposing parties were not entitled to do. Blake J concluded that the Guardian’s rights to freedom of expression were not materially promoted by the publication of the full documents. Accordingly the injunctive relief was continued.


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DESIGNS


Right to the Community Design


Fundación Espaňola para la Innovación De la Artesania (“FEIA”) v Cul de Sac Espacio Creativo, S.L. (“Cul de Sac”) and Acierta Product & Position, S.A. (“Acierta”) (AG Mengozzi for the ECJ; C-32/08; 26.03.09)(Decision not yet in English)


This was a reference from the Juzgado de lo Mercantil No. 1 de Alicante for a preliminary ruling regarding the interpretation and scope of Articles 14 and 88 of the Community Design Regulation No 6/2002.


FEIA organised a project the purpose of which was to create and commercialise a range of objects executed by craftsmen based on designs developed by professional industrial designers. FEIA appointed a company called AC&G, SA to select the designers to participate in the project. Each of the designers undertook to develop a design and to offer all the necessary support and technical assistance to the craftsman during the execution of the article.  


Amongst the different industrial designers retained, AC&G signed a contract with the design company Cul de Sac for the design of a range of cuckoo clocks. The clocks were executed by a craftswoman under the supervision of Cul de Sac. The final collection was called the Santamaria collection and was presented in the first exhibition of the FEIA project.


In 2006, Cul de Sac and the company Acierta put on the market the Timeless collection of cuckoo clocks. FEIA claimed that this collection infringed its rights in the Santamaria collection and sued both companies in the Juzgado de lo Mercantil No 1 of Alicante. In particular, FEIA claimed the title to the designs in question on the basis of the Community Design Regulation and Spanish law. Cul de Sac and Acierta denied infringement and submitted that the rights to those designs did not vest in FEIA.      


The Juzgado de lo Mercantil No. 1, considering that the outcome of the claim would depend on the interpretation of Articles 14 and 88 of the Design Regulation, made a referral to the ECJ. First of all, the Spanish Court asked for clarification as to whether Article 14(3) must be interpreted as referring only to Community designs developed in the context of an employment relationship under the direction and in the employ of another or whether it should also cover non-employment relationships, such as commission contracts.


Secondly, the referring court asked whether the terms ‘employee’ and ‘employer’ in Article 14(3) must be interpreted broadly so as to include relationships where, under the terms of a civil/commercial contract, an individual (a designer) undertakes to execute a design for another individual for a settled price and, as a result, it is understood that the design belongs to the person who commissioned it, unless the contract provided otherwise.


Thirdly, in the event that the answer to the second question is in the negative, on the ground that the production of designs within an employment relationship and the production of designs within a non-employment relationship constituted different factual situations, the referring court asked:



(a) is it necessary to apply the general rule of Article 14(1) so that, consequently, this must be construed to mean that the drawings and models belong to the designer, unless the parties stipulated otherwise in the contract? Or


(b) must the Community design court rely on national law governing designs in accordance with Article 88(2)?


Fourthly, in the event that national law is to be relied on, is it possible to apply national law even when the national law does not distinguish (as in the case of Spanish law) between design produced in the context of an employment relationship and designs produced as a result of a commission? Fifthly, in the event that the answer to the fourth question is in the affirmative, the Spanish Court asked whether such a solution conflicted with the negative answer to the second question.


FEIA and the United Kingdom (the only Member State to submit observations) pushed for a broad interpretation of the provisions of Article 14(3) to include, amongst others, designs developed under a commission contract.  Cul de Sac and Acierta argued that Article 14(3) should be applied exclusively to employment contracts.


The AG concluded that Article 14(3) applied exclusively to employment contracts; such provisions do not apply by analogy to non-employment relationships. 


In respect of the remaining questions the AG recommended that Articles 14 and 88 must be interpreted in the sense that the holder of the right to the drawings and models created within the framework of a contractual relationship (other than in the course of employment duties), such as the drawings and models carried out under a commission contract, must be determined in accordance with the expressed intention of the parties and the law applicable to the contract. On the other hand, the legislation of a Member State was not contrary to Article 14(3) if, for the purposes of determining in whom the rights to the drawings and models vested, it did not differentiate between the drawings and models carried out by a person receiving benefits under a commission contract with the drawings or models created by the employee within the framework of an employment relationship.


Reporter’s note: We are grateful to our colleagues at Bird & Bird LLP for their assistance with the preparation of this report: Amy Williams, Cristina Garrigues, Emilia Linde, Gina Brueton, Nick Aries, Nick Boydell, Taliah Davis, Tim Harris and Victoria Evans.


Profiles of all of our contributors above can be found on the "our people" page of our site.


ECJ and CFI decisions can be found at http://curia.eu.int/en/content/juris/index_form.htm and the reported cases marked * can be found at http://www.bailii.org/databases.html#ew


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