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European IP Bulletin, Issue 23, June - Trade Mark
Trade Mark
9. Celltech v OHIM
On 14 April 2005, the Court of First Instance (CFI) gave its judgment annulling the earlier decision made by the Second Board of the Appeal of the Office of Harmonisation of the Internal Market (OHIM) to register the word CELLTECH based on a lack of distinctive character.
The Second Board of Appeal had dismissed the appeal made by Celltech R&D Ltd to register CELLTECH as Community Trade Mark because the mark in connection with the related goods did not meet the minimum level of distinctiveness required under Article 7(1)(b) of EC Regulation No. 40/94.
OHIM argued that a sign must serve to identify and distinguish the seller and not merely to inform the consumer about the goods and services concerned. In this case, “cell” and “tech” are simply a combination of two English words and are commonly used in the medical and pharmaceutical fields, as well as in the class where the applicant sought to file, and OHIM said that their individual meaning was unambiguous in relation to the goods and services.
Celltech R&D Ltd. contested that 1) CELLTECH does not describe the goods and services when the term is taken as a whole; 2) the term CELLTECH is more than the verbal elements of which it is composed; 3) CELLTECH is a stand alone word which, taken as a whole, allows the consumer to identify the goods and services undertaken.
The CFI held that a sign must be assessed in relation to 1) goods and services to which registration is applied; 2) the perception of the public. The Court found that the goods and services covered by the mark were within the pharmaceutical field and the relevant public were the specialists from medical fields regardless of their mother tongue. It was also necessary to consider whether the word CELLTECH meant cell technology and was therefore descriptive of the goods and services. However, neither the Board of Appeal nor OHIM provided an explanation or demonstrated that CELLTECH was descriptive of the goods and services. The fact that the words of the mark taken separately is devoid of distinctive character does not mean their combination lacks distinctive character too.
Like DKV v OHIM, there is no evidence that the relevant public will immediately and without further reflection, make a definite and direct connection between the pharmaceutical goods and services claimed and the word CELLTECH. This case clarifies that a trade mark should be taken as a whole when considering its distinctiveness. Even if the mark is made up of individual words which are not distinctive.
10. Budweiser Budvar's EU Victory
The European Union (EU) has recognised the Czech brewery Budweiser Budvar's claim for protection of its beer under one of the Union's two regional designations since the Czech Republic joined the bloc last May. Geographical Indications are protected in the EU by Council regulation 2081/92 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs.
The Czech brewery are claiming this move by the EU as another victory against the American brewery Anheuser-Busch with whom they have a long-running legal dispute.
Anheuser-Busch claims it has rights to the name “Budweiser” because it was first to register the trade mark. Anheuser-Busch (AB) is a St. Louis-based American brewer who adopted the ‘Budweiser’ name in 1876. The Americans claim that German immigrants founded the brewery. Adolphus Busch (a German-born American beer brewer) thought it was a great idea to give the beer the evocative name ‘Budweiser’ because it reminded him of his old country which was already well known for its high quality beer products. Since many of the St. Louis brewery’s customers were recent immigrants from central Europe, the beer had instant name recognition.
The Czech company, Budweiser Budvar (Budvar) was founded in the town of Ceske Budejovice in 1895, though it is claimed the beer has been brewed in Budejovice since the 14th century.
The legal wrangle started in 1911, when Budvar decided to expand its market into the New World. On entering the US market, Budvar found that the term BUDWEISER had already been registered as a trade mark by AB in 1876.
Initially, it appeared as if a compromise between both parties had been reached. Both parties signed an agreement in 1911 when, for a financial settlement, Budvar permitted AB to use its registered trade mark in all areas outside Europe while Budvar kept the right to use the word BUDWEISER throughout the world. However, a supplement was added to the contract, which stated that AB was not permitted to use the word ‘original’ on its products containing the word ‘BUDWEISER’. This resulted in the coexistence of both Budvar and AB’s trademark in non-European countries. Budvar then sold its beer as CRYSTAL in the U.S. while AB used the name BUD in Europe.
New disputes broke out after Budvar, in accordance with the 1911 contract, registered its trade mark ‘Imported Original Bohemian Budweiser Beer from Budweis City’ in the US in 1937. It had been using this as a label since 1934 and brought it to the US because it contained the geographical indication. This enabled it to export its beer to the US. In 1939, at the time when the border region of what was the then Czechoslovakia had been taken over by German occupation, another agreement was signed. A week after signing, Czechoslovakia ceased to exist. Both Budvar and AB had pledged in the new agreement not to use the names BUDWEISER, BUD and BUDWEIS in countries specified in the agreement on the American continent. In the agreement, both parties acknowledged the priority of legal registration but not the priority of the use of the BUDWEISER name.
In 1978, due to Budvar’s strengthening position on foreign markets and particularly in Europe, AB’s management tried to obtain due financial compensation for the coexistence of both BUDWEISER brands in Europe. This triggered a new round of legal disputes in a number of countries. In 1990, AB submitted a proposal to buy a capital share in Budvar. A moratorium on legal disputes was signed as a result and lasted until 30th September 1994. The Czech Ministry of Agriculture rejected AB’s proposal in 1996. Since then both parties have only been in contact through their lawyers and as they strengthen their commercial positions, the tension grows.
The EU reasons that the Czech beer’s geographical origin protects it under EU rules, which provide important information on quality to consumers and guard authentic European regional specialties against "piracy" by other producers. As well as fighting for the name ‘BUDWEISER’, AB has also been fighting against geographical indication protections in dozens of Court cases around the world.
11. WIPO Recommends Uniform IP Protection Mechanism to
Regulate Domain Name Registrations
On June 1, 2005, the World Intellectual Property Organisation (WIPO) recommended the introduction of a uniform intellectual property protection mechanism with a view to controlling unauthorised registration of domain names in all new generic Top-Level Domains (gTLDs). WIPO’s Arbitration and Mediation Centre (WIPO Centre) published the recommendation in a report entitled "New Generic Top-Level Domains: Intellectual Property Considerations".
The report has been produced in response to a request by the Internet Corporation for Assigned Names and Numbers (ICANN), following the introduction of seven new gTLDs in 2000 (.aero., .biz, .coop, .info, .museum, .name, .pro). The report’s recommendation aims at assisting ICANN in developing a comprehensive strategy for further expansion of the domain name system (DNS). In particular, it focuses on protecting IP owners by helping to prevent unauthorised registration of their trade marks as domain names by third parties and cyber-squatters in the event that an extension of the DNS occurs. The report suggests that a further method to stop unauthorised registration of domain names during the initial phase of introduction of new gTLDs would help to counter the extensive phenomenon of cybersquatting.
The uniform mechanism proposed is preventive in nature and is intended to supplement the Uniform Domain Name Dispute Resolution Policy (UDRP), a quick and cost effective procedure for the independent resolution of disputes arising from the abusive registration of trade marks as domain names. WIPO’s UDRP experience provides evidence that, despite the expansion of the DNS in 2000, the majority of UDRP disputes involve the .com domain, a domain very popular with trade mark owners and cyber-squatters alike.
The report sets out and evaluates the WIPO Centre’s experience with various IP protection mechanisms already implemented in respect of a number of gTLDs and proposes new ones that could be put into practice. Such mechanisms should be “effective and minimise the potential for abuse, take account of rights and interests of third parties and, be practicable and straightforward in order to avoid undue delays in the introduction or functioning of new gTLDs”.
Concluding, the report recommends the implementation of a uniform preventive IP protection mechanism across all new gTLDs. New gTLDs would be obliged to give IP owners the opportunity to register their protected identifiers during an initial period of time before the general public were allowed to register. In sponsored or restricted gTLDs, where IP owners may be ineligible to register domain names, they could instead be allowed to register defensive registrations during the initial period. This would allow the public to benefit from reliable domains and would relieve IP owners from devoting significant resources to putting different IP protection mechanisms into effect, ICANN from monitoring their correct implementation and operators of gTLDs from having to develop their own protection mechanisms without necessarily being equipped to do so.
12. CFI Delivers First Substantial Dilution Decision
On 25 May, the Court of First Instance (CFI) delivered its judgment in Spa Monopole, compagnie fermiere de Spa SA/NV v OHIM, Case T-67/04.
Spa-Finders applied to register SPA-FINDERS as a Community trade mark for printed publications in Class 16 and travel agency in Class 39. Spa Monopole, the bottlers of the mineral water, opposed the application based on its earlier Benelux marks (SPA for waters and other drinks in Class 32, cleaning goods in Class 3 and LES THERMES DE SPA for goods in Class 3) and German mark (SPA for goods in Class 3 and various travel and bathing services in Class 42).
Spa Monopole based its opposition in particular on Art.8(5) of the CTM Regulation, which bars from registration marks which would, without due cause, take unfair advantage of, or cause detriment to, the distinctive character or repute of an earlier mark with a reputation. OHIM found that no unfair advantage or detriment would be caused to Spa Monopole’s marks by the SPA-FINDERS mark. Spa Monopole then appealed to the CFI.
The CFI dismissed Spa Monopole’s appeal. It held that although the parties’ marks were similar and Spa Monopole had established that it had a reputation for its SPA mark in relation to goods in Class 32, Spa Monopole had not proved that the registration of SPA-FINDERS would take unfair advantage of, or be detrimental to, the SPA mark. In making its findings, the CFI shed light on the meaning of the various clauses of Art.8(5).
Detriment to distinctive character was said to occur where the earlier mark is no longer capable of arousing immediate association with the goods for which it is registered and used. Spa Monopole had put forward no evidence that SPA-FINDERS would cause detriment to the distinctive character of the SPA mark. Contrary to Spa Monopole’s argument, detriment to the distinctive character of the SPA mark could not be inferred from the link that the public would make between SPA and SPA-FINDERS. The existence of a link between two marks is not sufficient on its own to demonstrate the risk of detriment to the distinctive character of the earlier mark. Moreover, since “spa” is the name of a Belgian town, a racing circuit and designates places for hydrotherapy, the risk of detriment to distinctive character was limited.
Detriment to repute was said to occur where the goods for which the earlier mark is applied for is used appeal to the public’s senses in such a way that the earlier mark’s power of attraction is diminished. Here Spa Monopole had produced no evidence that the registration of SPA-FINDERS would be likely to be detrimental to the repute of the SPA mark. There was no ‘antagonism’ between the goods and services covered by the marks SPA and SPA-FINDERS which might be detrimental to the repute of SPA mineral waters. Likewise, it was unlikely that the mark SPA-FINDERS would tarnish the image of the SPA mark. Here the goods in question were mineral waters, compared to travel services and publications. There was not sufficient proximity between the two sets of goods to lead to detriment to repute.
Unfair advantage of distinctive character or repute was said to occur where there is clear exploitation and free riding on coattails of a famous mark, or an attempt to trade on a famous marks’ reputation. In this case, there was no evidence that SPA-FINDERS would enable Spa Finders to take unfair advantage of the SPA mark.
The CFI also confirmed that the proprietor of an earlier mark is not required to demonstrate actual and present harm to his mark in opposition proceedings under Art.8(5). However, the proprietor must show prima facie evidence of future risk of unfair advantage or detriment that is not hypothetical.
This
decision provides valuable guidance as to the meaning of Art.8(5), although
sooner or later the issues discussed will have to be tackled by the European
Court of Justice. It should be noted that, while the CFI has said that actual
unfair advantage or detriment is not necessary under Art.8(5), the same is not
necessarily true of infringement proceedings because of a difference in the
wording of the two provisions of the Regulation.
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