2019 – Lisbon

Tribunal da Relação de Lisboa

Rua_Augusta_Arch

First Part – Acquired Distinctiveness

A short summary on the question of how “acquired distinctiveness” through a market survey is treated in the various national jurisprudences related to an application for registration or in cases to give evidence for “reputation” of a trademark

Court of Justice:

In the Judgement at “Chiemsee”, (CJEU C-108/97 point 49, 51, 53) the basic statement of the court was made. “ In determining whether a trade mark has acquired distinctive character following the use which has been made of it, the competent authority must make an overall assessment of the evidence that the mark has come to identify the product concerned as originating from a particular undertaking and thus to distinguish that product from goods of other undertakings; … the following may also be taken into account: the market share held by the mark; how intensive, geographically widespread and long-standing use of the mark has been; the amount invested by the undertaking in promoting the mark; the proportion of the relevant class of persons who, because of the mark, identify goods as originating from a particular undertaking; and statements from chambers of commerce and industry or other trade and professional associations. …. if the competent authority finds that a significant proportion of the relevant class of persons identify goods as originating from a particular undertaking because of the trade mark, it must hold the requirement for registering the mark to be satisfied; where the competent authority has particular difficulty in assessing the distinctive character of a mark in respect of which registration is applied for, Community law does not preclude it from having recourse, under the conditions laid down by its own national law, to an opinion poll as guidance for its judgment. Where the competent authority has particular difficulty in assessing the distinctive character of a mark in respect of which registration is applied for, Community law does not preclude it from having recourse, under the conditions laid down by its own national law, to an opinion poll as guidance for its judgment.”

The Court also quoted from the case „Gut Springenheide“ (C-210/96 points 36, 37) “However, Community law does not preclude the possibility that, where the national court has particular difficulty in assessing the misleading nature of the statement or description in question, it may have recourse, under the conditions laid down by its own national law, to a consumer research poll or an expert’s report as guidance for its judgment.“ In “Oberbank” (C-217/13 points 48,49) “it is not possible to state in general terms, for example by referring to predetermined percentages relating to the degree of recognition attained by the mark within the relevant section of the public, when a mark has acquired a distinctive character through use and that, even with regard to contourless colour marks, such as the mark at issue in the main proceedings, and even if a consumer survey may be one of the factors to be taken into account when assessing whether such a mark has acquired a distinctive character through use, the results of a consumer survey cannot be the only decisive criterion to support the conclusion that a distinctive character has been acquired through use. In the light of those considerations, the answer to the first question is that Article 3(1) and (3) of Directive 2008/95 must be interpreted as precluding an interpretation of national law according to which, in the context of proceedings raising the question whether a contourless colour mark has acquired a distinctive character through use, it is necessary in every case that a consumer survey indicate a degree of recognition of at least 70%.”

Recently the Opinion of Advocate General SAUGMANDSGAARD ØE in the case Oy Hartwall Ab (delivered on 22 November 2018 – Case C 578/17) carried out on point 73: “As regards the distinctive character acquired through use, it must be stressed that the competent authority must carry out an examination by reference to the actual situation and make an overall assessment of all the evidence that the mark has come to identify the goods or services concerned as originating from a particular undertaking. In that connection, it follows from the Court’s judgment in Oberbank that it is contrary to Directive 2008/95 for the assessment of a colour mark’s distinctive character acquired through use to be based solely on the results of a consumer survey. In that case, the Court held that even though a consumer survey may be one of the factors in the assessment, the results of a consumer survey cannot be the sole decisive criterion.”

General Court:

The GC follows in its case-law the principles decided on by the CJEU and it repeatedly quotes from the above-mentioned CJEU Judgments, following them as a basic statement. It is necessary to take into account all the elements of proof – there is no specific requirement for a “poll” – the analysis of a “poll” can be quite strict. If a survey seems to be not sufficiently clear, the application will be refused.

The following observations, in different opinions and decisions, are reflected in the judgments of the General Court: Salispir Case T-261/17 Bayer/EUIPO it should be emphasized that a detailed and strict analysis of the survey is made (“…one of the criteria allowing the results of a survey to be recognized as having probative value is that the survey be carried out in the objective circumstances in which the marks at issue are present, or may be present, on the market”). In point 50 the court considered that in particular the analysis of the pertinence of polls is done also in the context of a likelihood of confusion situation, as well as in the analysis of prior non-registered anterior rights under 8 (4) of the EU TM R – “Use of a sign in the course of trade of more than mere local significance”. In addition in point 60 and 61 the court stated: “As for the probative value of the two surveys, according to settled case-law, the principle which prevails in EU law is that of the unfettered evaluation of evidence, from which it follows, in particular, that the only relevant criterion for the purpose of assessing the probative value of evidence lawfully adduced relates to its credibility (see, to that effect, judgment of 15 December 2016, Infineon Technologies v Commission, T 758/14, not published, EU:T:2016:737, paragraph 179 and the case-law cited). Thus, in order to assess the probative value of a document, it is necessary to take account, in particular, of the person from whom the document originates, the circumstances in which it came into being, the person to whom it was addressed and whether, on the face of it, the document appears sound and reliable (see, to that effect, judgment of 6 November 2014,Popp and Zech v OHIM — Müller-Boré & Partner (MB), T 463/12, not published, EU:T:2014:935, paragraph 53 and the case-law cited).” …… Par. 61 “The probative value of a survey will depend on the survey method used (see, to that effect, judgment of 12 July 2006, Vitakraft-Werke Wührmann v OHIM — Johnson’s Veterinary Products (VITACOAT), T 277/04, EU:T:2006:202, paragraph 38). Applied to a survey produced as evidence by one party, the case-law cited in paragraph 60 above has already led the Court to refrain from recognising that the results of the survey have probative value, as the survey in question did not include sufficient information to enable the Court to satisfy itself as to the reliability of the survey (see, to that effect, judgment of 30 May 2013, Brauerei Beck v OHMI — Aldi (Be Light), T 172/12, not published, EU:T:2013:286, paragraph 28).”

See also: Case T 277/04, Vitakraft-Werke Wührmann & Sohn GmbH & Co. KG/EUIPO (point 38 and following) on the points of evidence to substantiate the public’s recognition of an earlier mark and Case T-112/13 (point 65 to 111) – Mondelez, in which the Court addresses surveys under the aspect of proof.

Austria: A survey is not mandatory, but delivered in many cases; no fixed result in numbers is required for acquired distinctiveness to be accepted.

Belgium: A survey is not mandatory; mostly applications on acquired distinctiveness are decided according to the Chiemsee decision of the CJEU on a case by case basis in considering the overall circumstances of the used sign in general. No fixed number in the result is necessary of conclusive.

Cyprus: In Cyprus there is no mandatory requirement for carrying out a market survey before applying for the registration of a trade mark. So far, there is no jurisprudence from the Cyprus Courts indicating that the absence of a market survey can lead to failure to prove that a trade mark is not distinctive or the contrary. Nor has any case been decided on the basis of percentage of distinctiveness. It is the overall impression that matters.

Czech Rep.: Surveys are not mandatory. No fixed number is demanded to accept acquired distinctiveness by use for registration.

France: A survey is not mandatory; if one is delivered, the jurisprudence requires no fixed number to accept acquired distinctiveness; whether the survey’s result is accepted by the court depends on the quality of the surveys method. Accepted is the 3 step-method. If the survey is not logically structured the court will decide on the basis of an overall view according to the Chiemsee case.

Germany: A survey in cases of a trademark application is not mandatory by law; but in the jurisprudence of the Federal Court of Justice (BGH) it is required as the most reliable proof. The result must reach at least 50 % plus 1. The Federal Court of Justice (BGH) allows courts to demand a survey ex officio and the competent board may even designate a certain institute. If a survey is not logically structured the case is set aside and the application for registration is refused. Before a party is allowed to submit a survey, prima facie evidence must be provided at the court. The numbers which must be given in it are similar to the “overall view” in the Chiemsee-case. If the numbers appear sufficient for a successful survey at least the court gives permission to conduct the poll.

Latvia: A survey is not mandatory; mostly the court decides on the basis of all circumstances. No fixed number is demanded to accept acquired distinctiveness by use for registration.

Netherlands: A survey is not mandatory; mostly applications on acquired distinctiveness are decided according to the Chiemsee-decision of the CJEU on a case by case basis in considering the overall circumstances of the used sign in general. No fixed number in the result is foreseen.

Norway: A survey is not mandatory but it is certainly helpful if the questions are conducted in a clear and precise manner. The case is decided on a consideration of all circumstances. No exact number is demanded to accept acquired distinctiveness by use for registration.

Poland: Surveys are not mandatory; they are one of the evidentiary measures of acquired distinctiveness. No fixed percentage of recognition is demanded to accept acquired distinctiveness by use for registration. Consequently, it is for the Patent Office to assess what degree of recognition of a given sign among the relevant public is necessary to consider that that mark has acquired a distinctive character as a result of its use. It is recommended that surveys are performed by independent institutes. Surveys should contain properly worded questions that should above all be neutral. This means that when formulating a survey, one should avoid asking questions which may suggest an answer or lead to the answers expected by applicant. Excessive interference in the answer may affect the evidentiary relevance of such surveys. It is also necessary to correctly identify the group of respondents so that they are representative of the relevant public.

Portugal: A survey is not mandatory but may be submitted, although not many surveys are submitted in the procedure; mostly it is too expensive for the parties. But if there is a survey, no fixed number is decisive to accept registration through acquired distinctiveness by use. In almost all cases acquired distinctiveness is considered by assessing all circumstances according the Chiemsee Judgement and the other cases of the CJEU.

Switzerland: A survey is not foreseen by law; therefore most cases are decided on the basis of an overall view if the numbers seems sufficient. Even if a survey shows an unprompted awareness of only 25 %, it might be considered sufficient (Swiss Federal Supreme Court, 4A_128/2012 of 7 August 2012, consid. 4.1.2 “Vogue”). The Swiss Office (IGE) published in it’s rules (12.3.9.) the following: “The Federal Supreme Court described the value of two thirds of the representative interviewees as a guideline sufficient for the assumption of the enforcement of the mark; at the same time, however, it referred to a guideline value of at least more than 50 percent, which it had assumed in a further decision concerning the question of a well-known trademark (BGer in sic! 2009, 167, E. 6.4.1 – POST, with reference to BGE 130 III 267, E. 4.7.3 – Tripp Trapp.)……..If the degree of identification is less than 50 percent, the majority of customers do not assign the sign in question to a specific company, either demonstrably or by a logical reverse conclusion.” In practice, however, nobody has ever submitted a demoscopic survey in the trademark registration process. This happens almost exclusively before civil courts, where the Office is not involved, so its view from the Guidelines is irrelevant.

Spain: Surveys are uncommon; the cases are considered on assessing all circumstances.

Turkey: Surveys are not very common in procedures, but parties are free to submit them. The court cannot ask for one. No fixed number is demanded to accept acquired distinctiveness by use for registration.

UK: Surveys are not mandatory. A claim to acquired distinctiveness can, in principle, be supported by survey evidence put forward for consideration together with other evidence concerning such things as the manner and scale of use of the sign in question. However, permission must in all cases be obtained in advance in order to put forward survey evidence for use in court proceedings and in proceedings in the Trade Marks Registry. This is a “gatekeeper” procedure intended to prevent the expenditure of time and money on survey work that may not provide evidence of real value. A request for permission should be accompanied by the results of a pilot survey and an explanation of the methodology that will be used for the proposed full scale survey. The request should demonstrate that the questionnaire is properly focused and fairly designed, that the answers to the questions are likely to be of real assistance to the tribunal and that the survey methodology can be expected to yield results that may be regarded as statistically valid. The survey should be designed and carried out in accordance with the “Guidelines” set out in the Judgment of the Court of Appeal in Interflora Inc. v. Marks & Spencer Plc. [2012] EWCA Civ 1501 at [61] (i) to (vii). No particular number / percentage result is required. The decision taker must always use his or her own judgment to assess the value of the information that is obtained. Surveys are treated as experiments. Experience has shown that it is difficult to design a survey that will be accepted as reliable to the required standard. A recent example of this (where several of the surveys presented to the court were carried out using the 3 step method) is provided by Glaxo Wellcome UK Ltd v. Sandoz Ltd [2019] EWHC 2545 (Ch) (4th October 2019). The methods and results of the surveys were examined in detail in paragraphs [200] to [246] of the Judgment. The court concluded that the survey evidence was largely unreliable and of no real value.

Second Part – Conclusions

Marks used for the purpose of certifying ‘geographical origin’ cannot be protected by registration as certification marks at the EU level under Art. 83(1) EUTMR 2017, but they may be protected by registration as certification marks in Member States which have exercised the option to make such protection available at the national level under Art. 28(4) Recast TMD 2015.

The question this raises is whether Art. 28(4) authorises Member States to depart from the rule that protection within the coverage of the various EU Regulations providing for registration of designations of origin / geographical indications at the EU level must and can only be obtained by registration under those Regulations (see, in particular, Case C-35/13 Assica EU:C:2014:306 at [28] to [39] and Case C-56/16P EUIPO v. Instituto dos Vinhos do Douro e do Porto (PORT CHARLOTTE) EU:C:2017:693 at [98] to [109]).

The reasoning of the Court in Joined Cases C-673/15P to C-676/15P The Tea Board (DARJEELING) EU:C:2017:702 at [49] to [63] points to the conclusion that there should be no substantive overlap between the bases on which designations of origin / geographical indications can be protected by registration under the regimes established by those Regulations and the bases on which trademarks can be protected by registration under the regimes established by the EUTMR 2017 and Recast TMD 2015.

In her Opinion in Case C-766/18 BBQlloumi (Halloumi) EU:C:2019:881 at [86] the Advocate General supported the view that it would be contradictory if producers’ associations could obtain equivalent or even stronger protection for geographical designations on the basis of trade mark law than in the protected designation of origin system.

If that is correct, it seems that Member States will need to avoid the potential for overlap by limiting the nature and scope of the protection obtainable by trademark registration for signs which have the capacity to function as designations of origin / geographical indications.

It is difficult to see how that could be done by limiting certification trade mark protection under Art. 28(4) to the extent necessary to give effect to the proposition that “the protection granted by a national set of rules must not have the effect of guaranteeing to consumers that products which enjoy that protection have a particular quality or characteristic, but only of ensuring that those products do in fact originate from the geographical area referred to”: Case C-35/13 Assica at [34] and [39].

The limitation would need to redefine the concept of certification in relation to signs indicative of ‘geographical origin’ so as to: (i) permit protection by registration at the national level of those which simply provide a guarantee of geographical origin; and (ii) prevent protection by registration at the national level of those which provide a guarantee not only of geographical origin, but also of the particular quality or characteristics of the products for which they are used.

Another way of avoiding the potential for overlap might be to prevent signs indicative of “geographical origin’ from being registered as certification trade marks at the national level under Art. 28(4) for products within the coverage of the EU Regulations which provide for the protection of designations of origin / geographical indications by registration at the EU level.

We think there is a need for early clarification as to whether the option provided by Art. 28(4) may only be exercisable at the Member State level subject to conditions and requirements which still remain to be clearly identified and implemented.

Art. 7(1)(f) EUTMR 2017 and Art. 4(1)(f) Recast TMD 2015 prevent the registration of “trademarks which are contrary to public policy or accepted principles of morality”. These provisions give effect to the requirements of Art. 2(1) of the TRIPs Agreement and Art. 6quinquies B(iii) of the Paris Convention of 20th March 1883 (as last amended on 28th September 1979).

The EFTA Court decided in Case E-5/16 Municipality of Oslo (6th April 2017) at [84] to [86] that the legislation identifies two alternatives (“public policy” based on an assessment of objective criteria and “accepted principles of morality” based on an assessment of subjective values) each of which may serve as a ground for refusal of registration. The end result is the same in either case: the obnoxious mark is treated as a “non-mark” for the purposes of registration.

We see nothing wrong, in principle, in deciding to exclude anti-social marks from registration in cases where it can be expected that commercial exploitation of the mark in question would be seriously hurtful or disturbing to a section of the public whose beliefs and values ought to be respected.

In our view, the main question of law to be addressed in this connection is whether the refusal of registration under Art. 7(1)(f) / Art. 4(1)(f) should be regarded as a restriction on the fundamental right to freedom of expression which must be tested for legitimacy in accordance with the requirements of Art. 11 of the EU Charter and Art. 10 of the ECHR.

That question is presently pending for determination by the CJEU in Case C-240/18P Constantin Film Produktion GmbH v. EUIPO (FACK JU GOETHE).

The Advocate General has proposed in his Opinion delivered on 2nd July 2019 (EU:C:2019:553) that the right to freedom of expression should be given real weight in the balancing exercise which he found to be necessary for the purposes of Art. 7(1)(f) / Art. 4(1)(f). He did not seek to attach – and we think it would be undesirable to attach – overriding importance to freedom of expression as a way of making obnoxious marks generally acceptable for registration under those Articles.

We note that the Lanham Act prohibition against registering “… immoral … or scandalous” trademarks has recently been invalidated by the US Supreme Court in the FUCT Trade Mark case for interfering too broadly and imprecisely with the right to “freedom of speech” guaranteed by the First Amendment to the US Constitution: Iancu v. Brunetti 588 U.S. (2019).

However, from an EU law perspective we see no reason to question the validity of the prohibitions set out in Art. 7(1)(f) / Art. 4(1)(f) and Art. 6quinquies B(iii) since they can, so far as necessary, be interpreted and applied compatibly with the requirements of Art. 11 of the EU Charter and Art. 10 of the ECHR.

The purpose of a disclaimer is to clarify the scope of the protection conferred by registration of a trademark.

This was recognised by the EU legislator in Art. 38(2) CTMR 1994 (repealed with effect from 13th April 2009) : “Where the trade mark contains an element which is not distinctive, and where the inclusion of said element in the trade mark could give rise to doubts as to the scope of protection of the trade mark, the Office may request, as a condition of registration of said trade mark, that the applicant state that he disclaims any exclusive right to such element.”

It was generally understood that a disclaimer had the legal effect of making it obligatory for the disclaimed element(s) to be treated as origin neutral for all purposes relating to the protection of the trademark as registered.

However, the CJEU has departed from that approach in Case C-705/17 Hansson EU:C:2019:481 on the basis that EU trade mark law precludes the possibility of providing “for a disclaimer whose effect would be to exclude an element of a complex trade mark, referred to in that disclaimer, from the global analysis of the relevant factors for showing the existence of a likelihood of confusion … or to attribute to such an element, in advance and permanently, limited importance in that analysis.”

We note that the ruling of the Court does not permit or require non-distinctive elements to be deemed distinctive. The Judgment confirms at [58] that “the proprietor of a complex trade mark cannot in any event claim an exclusive right solely in one element of the trade mark, whether or not it is referred to in a disclaimer” and it remains the case as stated in Arts 14(1)(b) and (2) EUTMR 2017 / Arts 14(1)(b) and (2) Recast TMD 2015 that the registration of a trade mark “shall not entitle the proprietor to prohibit a third party from using, in the course of trade: …(b) signs or indications which are not distinctive … where the use made by the third party is in accordance with honest practices in industrial or commercial matters.”

With those considerations in mind, we think that even after Hansson it should be legitimate to treat a disclaimer as prima facie evidence of the non-distinctiveness of the disclaimed element(s) of a complex trade mark, leaving it to the proprietor of the trade mark to prove otherwise if he can. In our view, it is appropriate in the interests of fair competition for third parties (particularly small and medium sized enterprises) to be able to rely on a disclaimer in the registration of a trade mark which has been asserted against them without being required to prove that it was and remains an accurate record of the non-distinctiveness of the disclaimed element(s).

An EU trade mark court should not “unless there are special grounds for continuing with the hearing” proceed to determine whether an EU trade mark is validly registered in a case “where an application for revocation or for a declaration of invalidity has already been filed at the Office”: Art. 132(1) EUTMR 2017.

We are aware that some EU trade mark courts may be more willing than others to proceed to a judicial determination of validity on the basis that the need for commercial certainty and their capacity to come to a decision without too much delay satisfies the requirement for “special grounds”. In such situations it remains possible for the proceedings pending before the EUIPO to continue unless and until the registration in question has been cancelled by a final order of an EU trademark court.

The situation becomes more complicated if the validity of the relevant EU trademark registration has not been challenged on the same basis and to the same extent in both the EU trademark court and the EUIPO. And the likelihood of that happening would increase substantially if the CJEU were to decide as some national decisions have suggested that claims for invalidity pursued in an EU trade mark court under Arts 127 and 128 EUTMR 2017 may not extend beyond the scope of the claims for infringement to which they respond. In many cases, the right to pursue a claim for invalidity in an EU trademark court would then be narrower than the right to pursue a claim for invalidity in the EUIPO.

We also note that the EU trade mark courts appear to have made no move towards using Art. 132(3) EUTMR 2017 as a basis for proceeding to deliver provisional decisions on the merits pending the outcome of EUIPO proceedings, by analogy with the reasoning of the CJEU in Case C-616/10 Solvay S.A. EU:C:2012:445 at [31] to [51].

There is, in our view, a need for authoritative guidance from the supervising courts in Luxembourg as to the principles on which the EU trademark courts and the EUIPO should operate for the purpose of implementing the “primarily exclusive” approach to jurisdiction envisaged by Art.132.

On the one hand, use of a mark as a “quality mark” is not sufficient, in and of itself, to amount to use of the mark as an “individual trade mark”: Case C-689/15 W.F. Gozze Frottierweberei GmbH EU:C:2017:434 at [41] to [46]; see also Case C-514/18P Landeskammer fur Land- und Forstwirtschaft in Steiermark EU:C:2019:878 at [36] to [43].

On the other hand, use of a mark as a “quality mark” can infringe the rights conferred by registration of that mark as an “individual trade mark”: Case C-690/17 OKO-Test Verlag GmbH EU:C:2019:317 at [26], [33], [43] and [50] to [53].

We recognise that there is no requirement for infringing use to be use of the kind which the proprietor must make in order to obtain or retain registration: see, for example, Joined Cases C-673/15P to C-676/15P The Tea Board (DARJEELING) EU:C:2017:702 at [51] to [53].

The point we wish to emphasise is that the proprietor of a mark which is used only as a “quality mark” cannot safely register it without structuring his economic activities in a way that will enable him to register it otherwise than as an “individual trade mark”.