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European IP Bulletin, Issue 21, April - Trade Mark
Trade Mark
8. O2 Holdings V Hutchinson 3G
On 11 March 2005, a decision was handed down in O2 Holdings Ltd & Anor v Hutchison 3G UK [2005] EWHC 344 (Ch). The issue was whether twelve questions set out by O2 regarding a comparative advertisement made by H3G could be referred to the European Court of Justice.
The dispute arose in August 2004 following H3G’s launch of a TV advertisement comparing its service to O2’s service. The advertisement featured the word O2, O2’s registered trade mark, as well as bubbles, which are registered as twelve device marks by O2. In an earlier interim application hearing, O2 failed to convince Pumfrey J that the use of O2 was an infringement of the word mark, and he also decided that whilst there may have been infringement of the device marks, there was not enough to justify an interim injunction. O2 then raised twelve questions which it sought to refer to the ECJ prior to the trial of the merits of O2’s amended claim. They included:
- Whether the average consumer would be confused by the advertisements;
- Whether images of bubbles were similar to the bubble marks;
- Whether the purpose of the advertisements was to attract consumers or to blur distinction of trade marks of O2 and H3G, and if it takes unfair advantage of the O2 trade marks;
- Whether H3G’s use of bubble image was an honest practice in industrial and commercial matters;
- Whether the use of the bubble image was damaging to the distinctive character or repute of the bubble marks;
- Whether O2 intended to use each of the bubble marks at the respective application dates;
- Whether it was sufficient for O2 to show that the mark had been diluted; and
- Whether the TV advertisements had to comply with the Misleading Advertising Directive.
The Judge declined the request for the referral, considering it to be premature. Any reference may also delay the substantive trial and prejudice the evidence to be adduced at trial. He further explained that:
- If H3G succeeded in its counterclaim that the bubble marks were devoid of any distinctive character, then the 12 questions would be redundant.
- The identity of the relevant sign used by H3G had not been determined.
- The questions to be referred to the ECJ depended on the findings of fact that the trial judge would make, which could be seen from the use of subordinate clauses. To make a reference prior to the finding of such facts would unnecessarily delay a case with commercial implications, and in any event, the reference may be made redundant in light of the facts found.
This case confirms the discretion of the national courts to make references to
the ECJ. It also demonstrates that a similar mechanism to that of the English
“speedy trial” for ECJ references may be useful.
9. Gillette: Spare Parts and the Consumer Trade Mark
This judgement in The Gillette Company and Others v LA-Laboratories Ltd Oy Case C-228/03 (17 March 2005) case concerned the scope of the exception to infringement provided by Article 6(1)(c) of the Trade Marks Directive 89/104 where the trade mark is necessary to indicate the intended purpose of a product, in particular as accessories or spare parts.
The Gillette Company owns the rights to the Gillette and
Sensor marks, which are both registered in Finland for certain
goods, including razors. It markets several razors and razor
blades under the Gillette name. The Defendant, LA-Laboratoires
Ltd Oy, was selling similar exchangeable blades marketed under
their own mark, PARASON FLEXOR, and including a statement on the
packaging: “All Parason Flexor und Gillette Sensor devices are
compatible with this blade”.
The Court of First Instance in Helsinki found that the exception
under Article 6(1)(c) did not apply to cases where the purpose
of the essential parts of a product were indicated, but rather
only to spare parts, accessories and other similar parts. The
Court of Appeal in Helsinki held that the razor blades were
indeed “spare parts” and so Article 6(1)(c) applied. On further
appeal to the Korken Oikeus, the Court referred several
questions to the ECJ relating to the applicability to “spare
parts”, how the test for necessity (to show purpose) should be
applied and the factors to be considered in determining whether
use is made in accordance with “honest practices in industrial
or commercial matters”.
Relying heavily on the famous BMW case C-63/97 [1997] ECR I-905,
the ECJ held as follows:
Since the intended purpose of the products as accessories or
spare parts is cited only by way of example, the application of
Article 6(1)(c) of Directive 89/104 is not limited to those
situations Therefore, it is not necessary to determine whether a
product must be regarded as an accessory or a spare part.
The trade mark owner may not prohibit a third party from using
the mark in trade where it is necessary to indicate the intended
purpose of a product or service, in particular as accessories or
spare parts.
The use of a trade mark to inform the public that the advertiser
is specialised in the sale, repair or maintenance of products
bearing that trade mark constitutes information necessary to
preserve the system of undistorted competition in the market for
that product or service. Use of a third party’s trade mark will
be “necessary” when “such use in practice constitutes the only
means of providing the public with comprehensible and complete
information on that intended purpose”. It is for the national
court to determine whether, in the circumstances of the case in
the main proceedings, use of the trade mark is necessary, taking
account of the nature of the public for which the product is
intended
The condition of “honest use” within the meaning of Article 6(1)
reflects a duty to act fairly in relation to the legitimate
interests of the trade mark owner. The ECJ gave 3 examples when
such use would not be in accordance with honest use. First, when
it is done in such a manner that it may give the impression that
there is a commercial connection between the reseller and the
trade mark proprietor. Second, when such use affect the value of
the trade mark by taking unfair advantage of its distinctive
character or repute. Finally, where the third party presents its
product as an imitation or replica of the product bearing the
trade mark of which it is not the owner.
It is for the national court to determine whether the use made
of the trade marks has been made in accordance with honest
practices. In this regard, account should be taken of the
overall presentation of the product marketed by the third party,
particularly; the circumstances in which the mark is displayed,
the circumstances in which a distinction is made between that
mark and any mark or sign of the third party, and the effort
made by that third party to ensure that consumers distinguish
its products from those of which it is not the trade mark owner.
The fact that a third party uses a trade mark of which it is not
the owner in order to indicate the intended purpose of its
product does not necessarily mean that it is presenting that
product as being of the same quality as, or having equivalent
properties to, those of the product bearing the trade mark.
Whether there has been such a presentation depends on the facts
of the case, and it is for the referring court to determine
whether it has taken place by reference to the circumstances.
This case confirms that the question whether an article is a
“spare part or accessory” is not fundamental to whether a third
party can rely on a defence under Article 6(1)(c). It also gives
some guidance on how “necessity” to refer to the trade mark to
indicate the purpose of the goods should be judged, as well as
whether it is in accordance with honest practices. These
considerations are to be determined by the national courts.
10. L’0real V OHIM
On 16 March 2005, the Court of First Instance delivered its judgment in L’Oréal SA v. Office for Harmonisation in the Internal Market (Trade marks and Designs) (OHIM) (Case T-112/03).
On 9 December 1998, L'Oreal SA filed an application for registration of a Community trade mark with OHIM for the sign FLEXI AIR. The goods in respect of which registration was sought are in Class 3 of the Nice Agreement.
On 30 November 1999, Revlon (Suisse) SA opposed the application based on the word mark FLEX, which was covered by registrations in France (in respect of goods in Classes 3 and 34), Sweden (in respect of goods in Class 3) and the United Kingdom (in respect of goods in Class 3). In support of its opposition, Revlon SA relied on the relative ground for refusal referred to in Article 8(1)(b) of Regulation No 40/94 arguing that L’Oreal’s mark was identical or similar to Revlon’s earlier mark and was being applied to identical or similar goods or services giving rise to a likelihood of confusion.
On 7 December 1999, the applicant was informed that an opposition had been
filed against its application for a Trade mark and on 23 March 2000, the
Opposition Division invited both Revlon and the applicant to submit further
observations within specified time limits. On 27 November 2000, having not
received further observations from either party, the Office notified both
parties that it would give a decision on the basis of the evidence before it. On
28 and 29 November 2000, the Office received observations from the applicant
stating that for reasons “beyond its control” it had only just become aware of
the opposition.
By decision of 27 March 2001, the Opposition Division rejected the application
for a trade mark on the ground of likelihood of confusion. In reaching its
decision, the Opposition Division did not take into account the applicant’s
further observations on the basis that they had been filed after the time-limit
set by the Office.
The applicant filed a notice of appeal against that decision and, by decision of
15 January 2003 (hereinafter “the contested decision”), the Fourth Board of
Appeal dismissed the appeal and ordered the applicant to pay the costs.
The present action was brought by L’Oreal against the decision of the Fourth
Board of Appeal of the Office. L’Oreal sought the annulment of the contested
decision and an order for the Office to pay the costs of these proceedings and
of those before the Board of Appeal.
In support of its action, the applicant put forward three pleas in law and the
Court delivered its findings in respect of each of the respective pleas as
follows.
The first plea in law was the infringement of essential procedural requirements
relating to the request for proof of genuine use. The Court stated that the
applicant should have requested proof of genuine use of the earlier mark within
the time limit set by the Office. In addition, the reasons “beyond its control”
as stated by the applicant were merely administrative errors for which it was
responsible and as such, could not justify the applicant’s non-compliance with
the set time-limit. Consequently, the Opposition Division was fully entitled to
reject the applicant’s request for proof of genuine use as it was filed out of
time. The Court rejected the first plea in law.
The second plea in law was the infringement of Article 8(1)(b) of Regulation No
40/94. The Court stated that even in a case involving an earlier mark of weak
distinctive character, on the one hand, and a trade mark applied for which is
not a complete reproduction of it, on the other, there may be a likelihood of
confusion, in particular on account of a similarity between the signs and
between the goods or services covered. The Court re-affirmed the Board of
Appeal’s finding that there was likelihood of confusion; namely, there was a
likelihood that consumers would believe that the slight difference between the
signs reflected a variation in the nature of the goods or stemmed from marketing
considerations, and not that that difference denoted goods from different
traders. In addition, the Court stated that since the signs were similar and the
goods partly very similar, the question of the extent to which the phonetic
similarity of the signs contributed to the likelihood of confusion was
irrelevant. In relation to the visual similarity, the Court found that neither
the fact that neither of the two words in the sign applied for were identical to
the earlier sign nor the fact that the latter was short were capable of
invalidating the visual similarity. The Court rejected the second plea in law.
The third plea in law related to the infringement pursuant to the definition of
‘earlier trade marks’ in Article 8(2)(a)(ii) of Regulation No 40/94. The Court
rejected the applicant’s hypothesis that Regulation No 40/94 confers on the
proprietor of an earlier national trade mark greater rights in connection with
an application for a Community trade mark than those conferred on him by
national legislation governing that earlier mark. The Court rejected the third
plea in law.
Based on the above-mentioned findings the Court of First Instance dismissed the
application and ordered the applicant to pay the costs.
11. Shark’ Is Not ‘HAI’: Trade Mark
Registration for Linguistic Equivalents
On 9 March 2005, the European Court of First Instance (“CFI”) handed down its judgment in the case of Osotspa Co. Ltd v OHIM (Case T-33/03).
Osotspa had an Austrian and a Community Trade Mark consisting of the word
‘Shark’ incorporated in a shark-shaped design - with the ‘s’ forming the head,
the ‘a’ the dorsal fin, and the ‘k’ the tail. These marks were registered for
‘non-alcoholic drinks’ and ‘syrups’ (Class 32) in 1996 and 1998 respectively. It
opposed an application to register the word mark ‘Hai’ (meaning shark in German)
in Classes 5, 32, 33, 35 and 42 by an Austrian company, on the grounds that the
use of the German equivalent of its trade mark on similar and identical products
was likely to cause confusion in the minds of public ( Article 8 (1) (b) of
Regulation No. 40/94).
The Opposition Division of OHIM rejected the opposition on the ground that there
was no likelihood of confusion between the marks in question. The Board of
Appeal concurred with the decision of Opposition Division. Osotspa appealed to
the CFI.
The CFI held that the grant and concurrent use of the ‘Hai’ word mark with that
of the earlier device mark ‘Shark’ would not result in confusion in the mind of
relevant public so as to trigger the bar in the Article 8 (1)(b) of the
Regulation, regardless of the similarity of the identity of goods in Class 32
and the identical semantic meanings. The CFI explained that the global
assessment of the likelihood of confusion concerns the visual, aural and
conceptual similarity between the conflicting marks. The overall impression of
the graphical and aural differences between the linguistic equivalents in this
case were stronger and overcame the conceptual similarity arising from the words
bearing the same meaning in different languages.
Furthermore, the goods in question were energy drinks sold in supermarkets,
restaurants, etc., intended for the younger generation, who in general are well
acquainted with branded goods. Thus, the semantic similarity becomes a secondary
factor once the customers can see and differentiate the marks on the products at
the point of sale.
This decision shows that a previous trade mark registration does not operate as
a bar for subsequent registration of its linguistic equivalent in all cases.
Before an application for trade mark registration of a linguistic equivalent is
allowed, however, the graphical and aural differences must be so pronounced so
as to overcome the semantic similarities arising from bearing the same meaning
in another language. This global assessment must be made keeping in mind the
relevant public, to see if confusion is likely. This approach promotes legal
certainty and strikes a good balance between the rights of owners of registered
trade mark and subsequent applicants, who intend to register the linguistic
equivalents of these trade marks.
12. Nike Wins Spanish Trade Mark Battle
Nike has triumphed in its long-running legal battle over the use of the NIKE trade mark in Spain.
Nike is the proprietor of the NIKE mark for clothing worldwide. However, in
Spain its attempts to use and register the NIKE mark had been met with
opposition from Cidesport, the proprietor of a Spanish mark consisting of the
word NIKE and a depiction of the goddess Samothracia.
In 1995 Nike won the right to use the NIKE mark before the Barcelona High Court.
However, the court’s decision was initially overturned by the Spanish Supreme
Court, which referred the issue to the Constitutional Court. Following the
Constitutional Court’s decision, the case was again appealed to the Supreme
Court.
In its 2005 ruling, the Supreme Court has held that Cidesport’s mark should be
declared invalid. The court said that Cidesport’s mark was liable to be
cancelled for lack of real and effective use. Additionally, its use led to
confusion as to origin on the part of consumers. Furthermore, using the NIKE
mark enabled Cidesport to benefit from the prestige of Nike’s famous mark.
Nike had already defeated Cidesport before the Office for Harmonisation in the
Internal Market. There Cidesport opposed Nike’s attempt to register NIKE as a
Community trade mark.
The Supreme Court’s decision clears the way for Nike to use its NIKE mark in
Spain.
The decision has been welcomed by Nike and ANDEMA, the Spanish National
Association of Trade Mark Defence. Soledad Rodriguez, the General Secretary of
ANDEMA, has highlighted the fact that the decision improves Spanish protection
of well-known marks.
This case demonstrates the difficulties that can arise when companies select
marks, which have pre-existing conceptual meanings (Nike is the Greek word for
victory and is the Greek goddess of victory, who is also known as Samothracia).
The pre-existing meaning increases the chance that another company elsewhere in
the world will have chosen to trade under that name. But in the absence of
actual trade, the earlier mark will be revoked for non-use, and the superior
rights converted to the later mark if sufficiently well known to support
registrability and claims of unfair competition or passing off (UK and Ireland)
were a third party to use the mark.
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