Trade Mark Newsletter November 2004
Contents
Shape Up!
What Is The Key?
Your Surname - Is It A Trade Mark? (Update)
When is Use Of A Geographical Term Not An Infringement?
Why Register? The Limits Of User Rights In
Europe
How Long Can Goodwill Last?
Stop Press: Slogans
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Shape Up!
In our earlier editions of this Newsletter, we have highlighted
the reluctance on the part of the UK Trade Marks Registry and OHIM
to register three-dimensional shapes as trade marks when owners
of such marks have the alternative protection route available to
them of obtaining registered design rights. This approach has been
manifested again in the decision set out below:
Molkerei Alois Muller GmbH & Co (“Muller”) applied
to register the shape of their “twin pot” yoghurt pot
on 31 October 1994 for “yoghurts; desserts and puddings”
in Class 29 and “desserts; rice desserts” in Class 30.
The twin pot shape is shown below:
The UK Registrar raised two objections to registration on the grounds
that the trade mark was devoid of distinctive character and, further,
that it consisted exclusively of the shape of the goods which is
necessary to achieve a technical result.
In order to overcome the first objection, Muller filed evidence
to support their claim that the trade mark had acquired distinctiveness
through use, along with a market survey which, they claimed, amply
demonstrated the public’s recognition of the trade mark.
In determining whether the twin pot shape had in fact acquired
distinctiveness through use, the Hearing Officer considered whether
the mark had come to identify the product as originating from the
applicant. The test laid out in Windsurfing Chiemsee (1999) was
applied.
The Hearing Officer was critical of the survey evidence filed by
Muller, suggesting that they should have designed the survey to
“simultaneously test respondents’ reactions to a different
shaped product of the same type”. However, despite the shortcomings
of the survey evidence, the Hearing Officer acknowledged that a
significant proportion of the relevant public recognised the container
shape as originating from Muller. In addition, Muller filed an independent
magazine article which indicated that the applicant had 73% market
share by value in twin-pot yoghurts.
However, the Hearing Officer still felt that this was not enough;
he said that it is necessary for the trade mark owner to use the
shape mark in ways that are apt to distinguish the commercial origin
of goods of an undertaking. He did not think the Muller container
shape was visible enough in the “course of trade” at the
point of selection to indicate the applicant’s goods.
The Hearing Officer thus concluded that the Muller twin pot had
not acquired distinctive character, but would have suspended the
application pending the ECJ decision in the case of Dyson v. Registrar
of Trade Marks, which was recently referred for guidelines on assessing
this type of evidence of distinctiveness. However, due to his further
conclusion that the sign consisted exclusively of the shape of the
goods necessary to achieve a technical result, he simply refused
the application.
In the second part of his decision, the Registry Hearing Officer
referred to the ECJ’s decision in Philips v. Remington, where
the court concluded that a sign consisting exclusively of the shape
of a product is unregistrable if it is established that the essential
functional features of that shape are attributable only to the technical
result. Moreover, this objection cannot be overcome by establishing
that there are other shapes which allow the same technical result
to be obtained.
Muller argued that not all features of their mark could be said
to be functional, particularly its square shape and its diagonal
split. However, the Hearing Officer felt that there was a functional
requirement to tip the contents of the smaller container into the
larger one, without spillage. Accordingly, the diagonal split was
necessary to achieve this; moreover, the overall square shape was
largely due to design restrictions for the diagonal split. Therefore,
he found both these features functional and attributable to obtaining
a technical result.
This is another decision where despite good evidence of public
recognition of a shape’s trade mark significance, the Registry
has taken a harsh line on functionality under s3(2) of the UK Act,
making it increasingly difficult to secure trade mark protection
for such shape marks.
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What Is The Key?
Many of our readers may be baffled by this question. It seems the
short answer is “Intellectual Property” which the UK Patent
Office is convinced is the key to business success. They are concerned
that not enough SMEs (small and medium enterprises) know this. So
they chose “What is the Key?” as the title of a campaign
to make SMEs, in particular, more aware of the benefits of protecting
their IP assets.
The campaign is supported by both the Chartered Institute
of Patent Agents and the Institute of Trade Mark Attorneys and kicked
off at the QEII Conference Centre in June this year.
The second phase of the campaign was launched in September
with regional visits to Oxford, Coventry, Bolton, Derby, York and
Newcastle. Future events are planned for Northern Ireland, Scotland
and South Wales.
On 19th – 20th November 2004, officials from
the Patent Office with representatives from the Chartered Institute
of Patent Agents and the Institute of Trademark Attorneys, will
be manning a stand at the Business Start-Up event held at the London
Docklands Exhibition Centre. Two of the firm’s trade mark associates,
Kara Bearfield and
Angela Thornton-Jackson
will be on hand to give advice on 19th November.
Free advice and information packs with guidelines
on protecting IP assets will be handed out to visitors and there
will be an opportunity to enter a draw whereby the first 200 applicants
drawn out of “the hat” will receive a free one hour consultation
with an IP specialist.
Why not go along to the event held closest to you
and pick up a free pack? Alternatively, our patent and trade mark
teams are always happy to give advice on IP protection, so do give
us a call. The “key” is to take advantage of these resources!
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Your Surname - Is
It A Trade Mark?
Further to the article in our September 2002 Newsletter, the European
Court of Justice have finally issued their decision in respect of
NICHOLS trade mark, providing guidance upon the registrability of
surnames in EU Member States.
The UK Trade Marks Registry have, for many years, refused registration
of common surnames, even though traders legitimately trading under
their own surname would have a defence to registered trade mark
infringement. The ECJ was asked to review the UK practice in this
regard. If common surnames should be registrable as trade marks,
the ECJ were also asked to determine whether or not this “own
name” defence would only be open to the individual, or also
companies trading under common surnames.
In its conclusions, the European Court held that the
assessment of whether or not a surname is a distinctive trade mark
should follow the same criteria as are applicable to other categories
of trade mark. Therefore, when assessing the distinctive character
of a surname, it is incorrect to apply stricter criteria than would
be applicable for other types of mark. Pre-fixed guidelines for
assessment, e.g. the number of entries in a telephone directory,
cannot determine this issue.
Instead, the registrability of the surname must be
assessed in relation to the goods or services for which registration
is applied. The perception of the relevant consumer must also be
taken into account, which may include considering the number of
traders sharing that name within the relevant market, as this could
affect the consumer’s perception of the sign as a trade mark.
Therefore it may prove more difficult to establish that a surname
has a distinctive character in certain categories of goods or services,
than it is in others. However, surnames per se cannot automatically
be regarded as unregistrable.
The ECJ also stated that a surname cannot be refused
registration on a point of principle, in order to ensure that no
unfair advantages are afforded to the first applicant. Therefore,
despite the previous concerns of the UK Trade Marks Registry upon
this point, the ECJ appear to be favouring a “first come, first
served” approach. The Court confirmed that traders legitimately
operating under their own names can use this fact as a defence and
are therefore unlikely to infringe any such registration. The ECJ
nevertheless viewed the existence of this defence as having no relevance
to the fundamental question of whether or not a surname is capable
of distinguishing one undertaking from another. Therefore, they
did not go on to provide clarification upon whether or not the defence
will be open to both individuals and companies operating under “their
own name”.
In summary, the ECJ have moved away from the restrictive
approach to registrability of surnames favoured by the UK Trade
Marks Registry, instead allowing registration upon a “first
come, first served” basis. They have not, however, clarified
whether or not companies trading under common surnames will have
a defence to registered trade mark infringement. Whilst OHIM will
no doubt accept most surnames for registration, it is probable that
the UK Trade Marks Registry will resist applying the present judgement
too liberally. However, as they can no longer automatically object
to registration relying upon a finding that a large number of people
within the United Kingdom possess that surname, more surnames should
progress to UK registration. Any traders operating under common
surnames should thus consider registering their name to ensure that
they have priority for their marks.
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When Is Use Of A Geographical
Term Not An Infringement?
A recent decision from the European Cout of Justice has far reaching
implications for owners of trade marks consisting of geographical
terms. The ECJ concluded that where use of an indication of geographical
origin is in accordance with honest practices in industrial or commercial
matters, such use cannot be prevented even where it is similar to
an earlier registered trade mark and a National Court finds that
there is a likelihood of confusion.
The case concerned trade mark infringement proceedings
launched in Germany by the beverage company, Gerolsteiner against
Putsch, a Marketing and Distribution Company, for the alleged infringement
for the trade mark GERRI. Putsch was offering for sale an imported
mineral water under the brand KERRY SPRING. The defendant’s
goods were produced by the Kerry Company in Ireland using water
from a spring known as Kerry Spring.
Whilst in some jurisdictions GERRI and KERRY might
not be viewed as being confusingly similar marks, the German Supreme
Court had no hesitation in upholding the lower court’s finding
that the relevant purchasing public would consider the marks similar.
The German Supreme Court concurred with the claimant that there
was a likelihood of aural confusion; however, the matter was then
referred to the ECJ for guidance as the Court was unsure as to whether
a finding for infringement should be made given that “Kerry
Spring” is an indication of geographical origin and was being
used in accordance with honest practices.
The judgement from the ECJ sets out clearly that if
the defendant’s mark is a geographical term and would be viewed
as such, use of the geographical indication could not be prevented
by the owner of the earlier registered trade mark, despite potential
confusion. The ECJ declined to apply their guidelines to the specific
facts of the case. Accordingly, it is now up to the German Courts
to apply the ECJ’s interpretation of the law to the case in
hand. In our view, it would be extremely surprising if use of KERRY
SPRING will now be restrained as an infringement of the earlier
registration for GERRI.
This case signals an important trend in the approach
to protection of brands consisting of geographical indications and
the particular difficulty that arises where there are conflicts
between trade marks and geographical indications.
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Why Register? The
Limits Of User Rights In Europe
The advent of the Community Trade Mark involved a balancing act
between conflicting legal systems (common-law and continental law)
with a particular tension when deciding on the levels of protection
afforded to marks which were used but not registered. As time has
gone by, it is increasingly apparent that reliance on mere user
rights is generally less advantageous when it comes to challenging
other conflicting marks than a trade mark registration. However,
it is still possible to found an opposition based simply on a claim
to established use of a mark; whether this will succeed is increasingly
debatable. Two recent decisions (outlined below) demonstrate this
quite decisively. In particular, where the use is not widespread,
or limited to one member state, this may not be enough.
Article 8(4) of the Community Trade Mark Regulation
provides for opposition or objection to a new Community Trade Mark
application by the proprietor of a non-registered trade mark or
other sign which is used in the course of trade, and which has more
then mere local significance. The meaning of these words was discussed
by Mr Justice Laddie in the case of Compass Publishing BV v. Compass
Logistics Limited (24 March 2004). He noted that the new system
provided safeguards for owners of earlier national rights, enabling
them to sue for infringement even where the later mark is the subject
of a CTM registration, and equally safeguarding the earlier user
from infringement attack by owners of subsequently acquired CTM
rights. Nevertheless, he also noted that this protection had limits
and concluded that the proper working of the CTM system placed a
relatively high onus of proof on earlier users seeking to challenge
a later registered CTM under Article 8(4).
The Judge thus concluded that a mark should be considered
as having “mere local significance” within the meaning
of Article 8(4) if its geographical spread is restricted to substantially
less than the whole of the European Union. In such a case, it was
likely that, from the perspective of the Community market in the
goods or services in question, the mark is of little significance.
It is only if use of the prior mark covers the whole or substantially
the whole of the European Community market that its impact will
be sufficient to object successfully to a subsequent application
for a conflicting Community Trade Mark.
In addition, Article 8(5) of the Community Trade Mark
Regulation provides an alternative ground for opposition or objection
by a non-registered proprietor of a trade mark which has a reputation
in the Community. The meaning of “reputation in the Community”
has recently been discussed by OHIM’s Third Board of Appeal
in Karl Fazer AB (OY) v. USP Brands Limited. The Third Board of
Appeal held that since the opponent in this case could prove reputation
only in Finland, this was not sufficient to satisfy the Article
8(5) test that the mark had a reputation in the Community. Comments
made in that case suggest that a reputation must exist in a substantial
part of the Community for the non-registered proprietor’s mark
to qualify for protection under Article 8(5) of the Regulation.
Given the recent expansion of the European Community
to 25 Member States, it appears that it will be increasingly difficult
to prove that un-registered rights enjoy anything more than mere
local significance or that a brand used in a single EU state is
well-known or has a reputation in a substantial part of the Community
for these purposes.
Thus, if national brand owners in the individual Member
States wish to make objections to subsequent conflicting Community
Trade Mark applications or registrations, they are safer relying
on registered trade mark protection at national or Community level.
It seems clear that the system will increasingly favour registered
trade mark proprietors in this way. Moreover, the threshold set
in this respect is very generous, since ownership of a registration
in one Member State of the EU is sufficient to found an opposition
or invalidation against a later filed CTM. The clear conclusion
is that registration is the better option for almost all traders.
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How Long Can
Goodwill Last?
The extent to which a residual goodwill in a mark is recognised
and protected in this country has been the subject of relatively
few decided cases in the United Kingdom. Of necessity, such cases
are decided on their own particular facts and there are no established
guidelines as to the time period during which residual goodwill
may be recognised or enforced.
A recent decision by the UK appointed person, overturning
(in part) the decision of the Trade Marks Registry’s Hearing
Officer in a cancellation action, involved an added complication.
The applicant for cancellation, Pharmacia AB, had changed its corporate
name from Pharmacia to Pharmacia & Upjohn in 1995 and had used
that form until the year 2000, when it reverted to Pharmacia. They
were proprietors of the PHARMACIA trade mark, registered and used
in the UK from 1962 – 1995 for pharmaceutical products. In
this case, they applied to invalidate a subsequent registration
of the mark FARMACIA URBAN HEALING covering goods in classes 3 and
5 (although the latter class did not include pharmaceuticals), and
the provision of pharmacy advice in class 42. They relied on conflict
with their PHARMACIA registration and goodwill in the name Pharmacia
as a consequence of their past use.
In its challenge to the registration for FARMACIA
URBAN HEALING, Pharmacia argued that at the time of registration
(March 2000), it had a residual goodwill in the name PHARMACIA,
although it had ceased use of that particular form five years previously.
The applicant for cancellation also relied on the continued use
of the composite name, PHARMACIA & UPJOHN, in support of its
claim to goodwill.
The Hearing Officer found that Pharmacia had a goodwill
in the name PHARMACIA for its pharmaceutical business in 1995, but
that it no longer had a reputation in that name in March 2000. The
Appointed Person reversed this finding, concluding that there was
no intention on the part of Pharmacia AB to abandon the goodwill
generated through use of PHARMACIA alone up to 1995, and indeed,
that continued use of the word in the composite, PHARMACIA &
UPJOHN, demonstrated the contrary. He also relied on the subsequent
change of company name back to Pharmacia by itself. He pointed out
that another direct competitor would have had no opportunity to
adopt the name or trade mark PHARMACIA in March 2000 without a successful
challenge on grounds of “passing-off” from the original
owner.
He found that it was “virtually inconceivable”
that Pharmacia did not have a continuing reputation and goodwill
under the PHARMACIA trade mark for its core pharmaceutical business
in March 2000 and that this conclusion was bolstered by the mark’s
potential for supporting and improving future business, which Pharmacia
had chosen to exploit by changing their name back to the original
form in that year.
Having found that Pharmacia AB had an established
and continued goodwill in their PHARMACIA name at the time when
the FARMACIA URBAN HEALING mark was filed, the Appointed Person
nevertheless concluded that this goodwill did not extend to prevent
the registration of the latter mark for any of the proprietor’s
goods in classes 3 and 5; he decided that pharmaceuticals had different
uses to natural health and beauty products and were essentially
different in nature. In reaching this conclusion, he relied inter
alia on the fact that there had been no confusion arising from the
use of the FARMACIA URBAN HEALING mark on such products from 1998
onwards.
However, he did conclude (contrary to the Hearing
Officer’s decision) that provision of the pharmaceutical and
medical services claimed in class 42 could lead to confusion and
cancelled the mark in that category. In fact, Farmacia had never
offered such services either at the time when they applied to register
FARMACIA URBAN HEALING or subsequently.
Obviously, the clear intent on the part of Pharmacia
AB throughout the relevant period to continue relying on the PHARMACIA
name, albeit not in the form originally used, assisted in this result;
while there is no doctrine of abandonment in this country (contrast
the position in the USA), it is nevertheless a relevant consideration
that a trade mark owner has a continued interest in maintaining
and exploiting a mark and has taken commercial steps which manifest
that intent.
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STOP PRESS - SLOGANS
At the end of October the ECJ issued their judgement in the case
concerning the protection of the slogan, ‘The Principle of
Comfort” (in German). Unusually they decided not to follow
the Opinion of the Advocate General. Instead, the Court confirmed
the view of the CFI that OHIM had wrongly assessed the distinctiveness
of the slogan. Therefore, despite errors in the lower Court's approach,
the ECJ dismissed OHIM’s appeal.
Their judgement will provide a much needed boost for
those attempting to protect slogans as trade marks.
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