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Snippets Spring 2012

Specsavers is a well-known chain of opticians that operates in the UK. It employs a logo in which the word Specsavers appears in white lettering within two “kissing”, dark green coloured ovals (see below). The company owns CTM rights protecting the word mark, the logo in black and white and the two “kissing” ovals, again in black and white, but without the word Specsavers.

Asda is one of the UK’s most successful food supermarkets. As one of its “added extras”, it offers an in-house optician service. In 2009, it decided to re-launch this service with a new marketing campaign. Following a long tradition amongst British supermarkets, Asda looked to the market leader for “inspiration”. As a result, the campaign centred upon a green and white logo (see below) that featured the words ASDA and Opticians in two (nearly kissing) ovals, as well as two slogans, “Be a real spec saver at Asda” (the first slogan) and “Spec savings at Asda” (the second slogan). All of these three elements were employed together, in order to achieve Asda’s desired effect. Specsavers, being less than enamoured with this campaign, brought trade mark infringement proceedings based on its CTM rights in the English High Court.

The grounds were a likelihood of confusion (Article 9(1)(b) CTM Regulation) and taking an unfair advantage (Article 9(1)(c)). In a 2010 dated decision, the High Court rejected all of Specsavers’ claims except one. The only exception was a finding that the first slogan (Be a real spec saver at Asda) took unfair advantage of Specsavers’ reputation in its registered word mark and logo (containing the word mark). This ruling was made in the face of clear evidence that Asda had targeted Specsavers’ advertising when designing its (Asda’s) campaign, one internal Asda comment on a proposed design stating “Asda version of Specsavers – rip off”.

To add salt to Specsavers’ wounds, the High Court Judge also revoked Specsavers’ CTM registration for the two “kissing” ovals without the word Specsavers on the ground of five years non-use, deciding that use of the logo with the word Specsavers did not save a registration for the logo without the word.

Specsavers appealed to the Court of Appeal who, in a recent ruling (Specsavers International Healthcare v Asda Stores) took a rather different view.

First of all, the Appeal Court generally agreed with the lower Court’s finding that there was no infringement under Article 9(1)(b) CTMR (likelihood of confusion). In the Appeal Court’s opinion, the prominent use of the trade mark ASDA served to avoid confusion. There was nothing inherently wrong with “living dangerously”, as Asda had done, provided the end result was a sign (or signs) that was a safe distance away from the original.

The one question that clouded this view was whether Specsavers’ enhanced reputation in the colour green (of their logo) should be taken into account when making a global assessment of the likelihood of confusion.

The High Court Judge had decided that, because Specsavers were relying on a black and white version of their logo, they could not rely on an enhanced reputation in the colour green. The Court of Appeal put a question on this important point to the Court of Justice (CJEU). In doing so, one of their Lordships (Kitchin LJ) did express the views that a registration of a mark in black and white covered that mark in all colours and further that, in the case of such a black and white registration, use of the mark in just one colour should be taken into account in a global assessment of a likelihood of confusion.

Turning to the issue of “unfair advantage” (Article 9(1)(c) CTMR), the Appeal Court disagreed with the position taken by the High Court. In the Appeal Court’s opinion, Asda’s marketing campaign could not be viewed as comparative advertising since it was not an “objective comparison of verifiable and representative features of the parties’ goods and services”. Further, when assessing the issue of “taking unfair advantage”, Asda’s advertising campaign had to be considered as a whole when considering the impact of each individual aspect of that campaign. It was not correct to look at each aspect in isolation.

Bearing the above in mind, the Court of Appeal found that the ASDA Opticians logo, as well as both the First and Second Slogan, benefited from the “power of attraction, reputation and prestige” of the Specsavers marks. The intention of Asda to try to form a link with Specsavers was clear and they had succeeded in that intent; consumers would form such a link between Asda’s logo and slogans and Specsavers’ marks and reputation. The combined use of the ASDA logo and the slogans served to reinforce the link and to ensure that unfair advantage would be taken. It followed that Asda’s logo and their two slogans all infringed Article 9(1) (c) of the CTM Regulation.

Finally, the Court of Appeal turned to the High Court Judge’s finding that Specsavers’ CTM registration for the “kissing” logo without the word mark should be revoked on the ground of non-use. This issue was also put to the European Court (CJEU) for a ruling. To paraphrase the questions; first, does use of a logo which consists of a word mark and a graphic device (e.g. “kissing” ovals) save a CTM registration for the graphic device alone? Further, if so, does that also apply where the word mark is superimposed on the graphic device (as in the Specsavers case)? These are key questions for the future of trade mark practice in the EU and it is to be hoped that, contrary to many previous cases, the Court of Justice will give a ruling that is clear and understandable.

Suddenly the Court of Appeal appears to be viewing the rights of UK trade mark and CTM proprietors more favourably. Anyone who can speculate as to why this should be, should send their answers on a postcard to the writer.

In another recent case (WHG (International) v 32 Red; 2012 EWCA Civ 19), the Court of Appeal upheld the validity of all the trade mark registrations relied on and found that those rights were infringed by the defendant’s activities.

32 Red is a Gibraltar based on-line casino that operates under the same name and, through the company, Trafalgar Media, owns CTM registrations for 32 Red and 32 Red (stylised) covering a variety of casino and gambling related goods and services. Trafalgar Media also owns a UK trade mark registration for the number 32 for casino services in Class 41.

In 2008, the well-known UK betting firm, William Hill, purchased an Antiguan based on-line gaming business called 32 Vegas which had not previously operated in the UK. Through its sister companies, WHG (International) and WHG Trading, William Hill obtained gaming licences to use the trade mark 32 Vegas and began operating an online gaming business under that name.

32 Red sued WHG for trade mark infringement in the English High Court relying on their CTM rights in 32 Red and the UK registration for 32. WHG counterclaimed that 32 Red’s trade mark registrations were invalid. Before the High Court, the Judge ruled that

i) All of 32 Red’s trade mark registrations were valid and enforceable.

ii) WHG’s 32 Vegas branded services infringed 32 Red’s CTM registrations for 32 Red.

iii) The use of 32 Vegas did not infringe the UK trade mark registration for 32.

WHG appealed against this adverse decision ((i) and (ii)) and 32 Red appealed against the finding of non-infringement in respect of their UK registration (iii).

The Court of Appeal ruled as follows:

• Whilst 32 Red could be a particular outcome in a game of roulette, that was not enough for the sign to be nondistinctive in relation to or descriptive of either a game of roulette or any other type of betting game offered by the trade mark owner. Further, there was nothing in WHG’s evidence to suggest that the term 32 Red was a customary sign or indication. Similar comments applied to the sign 32. WHG had also alleged that Trafalgar Media had registered the UK trade mark registration for 32 in bad faith having no intention to use it but only an intention to seek to enforce it against third parties. This argument was also given short shrift by the Court of Appeal. It was not an act of bad faith for a company to file a UK trade mark application in order to strengthen its position in impending litigation or, in the present case, when a company is aware that a similar mark is already being used by a competitor for identical services. Further, it is not bad faith to register the distinctive part of a mark that is actually used by the applicant.

For these reasons, all of the grounds of invalidity that had been raised by WHG were dismissed.

• Turning to the issue of infringement, the Court of Appeal found that WHG’s (William Hill’s) use of 32 Vegas in respect of on-line gaming services in the UK was likely to lead to confusion with the trade mark 32 Red amongst the relevant gaming community and was also likely to be detrimental to 32 Red’s reputation in their 32 Red mark. Infringement of 32 Red’s CTM registrations by WHG’s use of 32 Vegas was therefore found.

• Disagreeing with the High Court’s finding in relation to the (non) infringement of 32 Red’s UK trade mark registration (for 32), the Court of Appeal found that 32 Vegas was confusingly similar to 32.

According to the Appeal Court, 32 was the dominant element of both 32 Red and 32 Vegas and if, on that basis, the use of 32 Vegas infringed 32 Red’s CTM rights in 32 Red, such use must also infringe 32 Red’s UK registration for 32. This case is a reminder of the potential value of a pre-emptive strike of filing the dominant feature of a mark that is in use. See, for example, Red Bull’s protection of the marks Red and Bull, in addition to their widespread registration of Red Bull itself. If the product is successful enough to justify such action, it should always be taken.

This case, when considered in the light of the Specsavers case discussed above, also suggests that a new age may be upon us in the UK, an age in which the owners of IP rights, trade marks, designs and patents, may be given a fairer crack of the whip when legitimately seeking to enforce those rights.

Queen Elizabeth II celebrates 60 years since her accession to the throne in 2012, and the bunting is out! Not only do Her Majesty’s subjects get an extra day’s holiday, they also get to partake in a number of wild celebrations, not the least of which will be a flotilla of a thousand boats of all shapes and sizes that will muster on the River Thames on the 3rd of June. This event has been styled The Thames Diamond Jubilee Pageant and it is gratifying for an ageing trade mark attorney to note that the rather tasteful logo for the occasion has been protected with a UK filing.

This joins a number of other recent filings for Diamond Jubilee marks made by an eclectic mix of commercial enterprises. As one would expect, the Royal Mint is in there with a rather artistic mark that will be associated with their collection of Diamond Jubilee coins and medallions. Then there is Savile Row’s Holland & Sherry, purveyors of “The Finest Cloths In The World”, with their application for Diamond Jubilee textile goods. As any gentleman would feel himself undressed if his Savile Row suit were not adorned with a buttonhole, it is only right that Rosen Tantau KG of Uetersen has protected Diamond Jubilee for roses. Given the roots of the House of Windsor, it seems entirely appropriate that a German breeder of plants and flowers should be part of the merriment.

Of course, it is also fitting that such a long reign should be toasted with an appropriate beverage and luckily a number of companies including Chivas, Diageo and Gonzalez Byas will be on hand to provide their Royal Salute Diamond Jubilee and Diamond Jubilee by John Walker & Sons whiskies and their Diamond Jubilee Vilarnau sparkling wine, all also protected by trade mark filings.

Finally, after putting on one’s Diamond Jubilee suit, adding a dash of colour with a Diamond Jubilee rose, drinking a Royal toast with Diamond Jubilee wine and Diamond Jubilee whisky, what better way to end the evening than gambling away all your Diamond Jubilee coins on the Diamond Jubilee slot machines provided (and registered) by IGT of Nevada?

Here’s to the Platinum (70th) Jubilee!

Under the “exhaustion of rights” provisions of the Trade Marks Harmonisation Directive (Article 7) and CTM Regulation (Article 13), a trade mark proprietor in the EU cannot, under normal circumstances, prevent the parallel importation of goods that have been lawfully put on the EU market. The vast majority of case law in this area has involved pharmaceutical products because of the disparity between the prices of such products in different EU countries.

One of the favourite tricks of the parallel importation (of pharma products) trade, is the repackaging of such products by the parallel importer. A large body of rules has been developed by case law (see, for example, Bristol-Myers Squibb 1996 ECR I-3457) regarding the precise manner in which the repackaged product should be labelled. One of those rules is that the name of the repackager should appear on the pack.

Orifarm A/S (Orifarm) is a Danish parallel importer. It owns the market authorisations to import and sell a number of pharmaceutical products that were originally placed on the EU market by the US company, Merck Sharp & Dohme (MSD).

Orifarm imported the MSD products to Denmark and arranged for their repacking by their related company Orifarm Supply (Supply), who had an authorisation to carry out such repackaging. Supply duly performed the repackaging but identified Orifarm as the repackager on the pack.

Like most pharmaceutical research houses, MSD doesn’t require much excuse to bear down on a parallel importer; any transgression, however minor, is seized upon. And so it came to pass that MSD brought trade mark infringement proceedings against Orifarm in Denmark.

At first instance, the Danish Court found in favour of MSD, ruling that the omission of the actual repackager (Supply) from the repackaged products provided a legitimate reason for them (MSD) to oppose the further commercialisation of their products in Denmark.

Orifarm appealed and the Danish Supreme Court asked the Court of Justice (CJEU) for a ruling (Case C-400/09). The European Court decided that, in cases such as this, where the repackaging was performed by a company with an authorisation to do so (repackage) on the instructions of the company owning the marketing authorisation, it was acceptable for the owner of the marketing authorisation to be identified on the pack, rather than the repackager.

This is a sensible, practical decision which looks beyond the literal wording of the rules developed in earlier PI cases. A similar nonliteral interpretation of “counterfeit goods” in the Nokia goods in transit case discussed elsewhere in this edition of Make Your Mark would have been welcomed.

A recent case before the English High Court (Ate My Heart v Mind Candy) involved an application by the pop singer Lady GaGa (aka Stefani Germanotta) for an interim injunction preventing the release of a single on iTunes by the cartoon character Lady Goo Goo.

Mind Candy runs a successful children’s game website called Moshi Monsters. It features a number of characters which are said to be parodies of well-known pop stars, including Broccoli Spears and Lady Goo Goo; the latter being a sunglasses wearing baby character.

Lady Goo Goo had first appeared in the Moshi Monsters game in September 2009 and appears to have been tolerated by the pop singer until a song performed by the character became a YouTube sensation and was set to be released via iTunes. At that point, Lady GaGa’s rights-owning company, Ate My Heart, sought an injunction against Mind Candy’s use of the trade mark Lady Goo Goo based on their earlier trade mark registrations for Lady GaGa covering relevant goods and services in Classes 9 and 41. Ate My Heart argued that the trade marks Lady Goo Goo and Lady GaGa were confusingly similar and also that the distinctive character of the trade mark Lady GaGa would be damaged.

Mind Candy argued that their use of Lady Goo Goo was merely a parody of the pop star’s name and that there would therefore be no confusion with Lady GaGa and no connection would be made between the cartoon character and the pop star.

At this interim stage, the Judge (Mr. Justice Vos) disagreed. In the Judge’s view:

• Whilst some users of the Moshi Monsters game might think that the cartoon character was a parody of Lady GaGa, others might well believe that they were economically connected. This view was reinforced by evidence of actual customer confusion both on YouTube and in the blogosphere.

• Given the nature (rather annoying nature) of the Lady Goo Goo song, there was a risk that the reputation of the Lady GaGa trade mark could be tarnished.

• If Lady Goo Goo became a popular singing artist in her own right, this might well be as a result of taking unfair advantage of the pop star’s reputation in Lady GaGa.

In view of the above, an interim injunction was granted against Mind Candy’s posting of Lady Goo Goo songs on YouTube and against the sale of such songs on iTunes. No injunction was given however in respect of the appearance of the Lady Goo Goo character (without the song) in the Moshi Monsters game.

If confirmed in a full trade mark infringement action, could this case have a wider impact on tribute bands and parody songs at large? Certainly, tribute groups and singers have been an accepted part of the popular entertainment landscape in the UK for decades. Groups such as The Bootleg Beatles, Not The Rolling Stones (featuring Mike Jagger), Take That 2 and The Spicey Girls have all had varying degrees of success, not to mention the hundreds of Elvis Presley impersonators who earn a crust from the reputation of the late rock and roll singer.

However, the times may be a-changin’. It is reported that the commercial interests behind the group Abba are seeking to stop the activities of the numerous Abba look-alikes that operate in the UK, based on their (the original group’s) broad range of trade mark rights in the mark Abba. It will be interesting to see if other groups/singers follow the same route. It may not be a straightforward decision for some however, particularly those groups and singers who are past the first flush of youth, because it could strongly be argued, from a commercial, rather than from a legal perspective, that tribute bands/singers, keep the public’s interest in the original groups/singers alive and that they therefore help to maintain a healthy level of record sales by the original artists.

As the commercialisation of education continues apace in the UK, it is no surprise to read of the proposed creation of a new private, for-profit undergraduate college in London. The college, which is the brainchild of the philosopher A.C. Grayling, announced plans last year to charge annual fees of £18000 for courses in economics, history, law and philosophy given by celebrity lecturers such as the biologist Richard Dawkins.

The announcement of Professor Grayling’s less than abstract idea was greeted by howls of protest from the traditional academic community, being described as “a toff’s college”, “a provocative concept”, a “sham” and “a branding exercise”. No doubt Professor Grayling and his colleagues can live with all of these comments. What may prove to be more difficult to live with, are the objections raised against the name chosen for this educational establishment.

Whilst the choice of New College Of The Humanities could be seen as showing a surprising lack of imagination for the identification of a novel educational concept in the UK, it does, on the other hand, have the advantage of “doing exactly what it says on the tin”. Unfortunately, that advantage can turn into a disadvantage once, as all ambitious commercial enterprises should do, you try to protect the name as a registered trade mark. Not surprisingly a UK trade mark application for New College Of The Humanities, filed in May 2011, has recently been abandoned, presumably, in part at least, because of the lack of distinctiveness of the mark in relation to the education based goods and services claimed.

Whilst this setback has no doubt created some mirth in the Common Rooms of many British Universities, there may be an even greater cause for merriment should a reported trade mark dispute between New College Of The Humanities and the venerable New College, Oxford be correct.

The Oxford college, founded in 1379, had existed for 632 years before it decided to protect its name as a registered trade mark; a move no doubt prompted by reports of the upstart private college. Further, even though their UK trade mark filing (for New College, Oxford) was filed over two months after the application for New College Of The Humanities, New College, Oxford now has registered trade mark protection for its name covering such useful student accoutrements as walking sticks, cufflinks, dressing gowns and champagne flutes (it is an Oxford college!). Whether the Fellows of New College, Oxford will be willing to settle this potential trade mark disagreement with the tradesmen of New College Of The Humanities remains to be seen.

In the new atmosphere of competition between educational establishments, the dispute is more likely to be resolved between the two parties’ lawyers than over the port and stilton.

Now that OHIM, and certain EU national trade mark registers, have started to accept single letter marks as distinctive (when there is no good reason to reject them other than they are single letters), see OHIM v Borco-Marken-Import (C-265/09P), the next big question is “How broad should the penumbra of protection for such marks be”? If the recent European Court case between ara AG and Allrounder SARL (T-174/10) is anything to go by, the answer to that question is “Not very”.

Allrounder filed an International trade mark application (no. 895320) designating the CTM in, amongst other, Classes 18 and 25. The mark claimed was a letter A with two triangular horns; the whole designed to look like a Viking helmet. The IR (CTM) was opposed by a German company, ara AG, on the basis of an earlier German trade mark registration for the unstylised single letter A registered for identical goods. The opposition was rejected by both the Opposition Division and the Appeal Board. The German opponent appealed to the European Court (General Court).

The Court ruled in favour of Allrounder in the following terms:

• Although both marks contained the letter A, the dominant feature of the CTM mark applied for was horns. There was therefore only a weak degree of visual similarity.

• The nature of the mark applied for was that it would be described, rather than referred to as “A”.

• Any conceptual similarity caused by the coincidence of the letter A was overridden by the idea of horns.

• The earlier mark (A) had only a weak distinctiveness.

• Taking all of these factors into account there was no likelihood of confusion.

The existence of related German Court cases where a risk of confusion had been found were not found to be persuasive.

This case was properly decided and quite rightly took into account the borderline distinctiveness (inherent non-distinctiveness?) of a single letter mark. The outcome should be contrasted with recent European Court cases involving marks that contain non-distinctive words. One such case, Olive Line International v Reinhard Knopf (T-485/07) involved a CTM application for the stylised mark O-live covering goods in Classes 29, 30, 31 & 33, including olives and olive products, in the name of Mr Knopf.

This CTM application was opposed by a Spanish company (Olive Line International) on the basis of their use of an earlier Spanish trade name for Olive Line (stylised). The Spanish opponent traded in olives and olive products.

The Opposition Division and the Board of Appeal both rejected the opposition, principally in view of the low distinctive character of the word Olive in respect of the goods claimed and the consequent lack of likelihood of confusion. Olive Line International appealed to the European Court (General Court) who astonishingly overturned the Appeal Board’s decision and allowed the opposition. According to the Court:

• The low degree of distinctiveness of an element in a mark/name does not mean that it cannot constitute a dominant element.

• The common presence of the word Olive leads to visual, phonetic and conceptual similarity and to a likelihood of confusion.

Given that the Spanish word for olive is oliva and that therefore one can assume that even the notoriously undiscerning (according to the European Court) Spanish consumer would understand the meaning of the word olive, particularly when it is combined with an image of an olive, this is, even by the standards of the General Court, a pretty extraordinary decision.

Any distinctiveness in either mark lies overwhelmingly in the stylisation of the words and in the device elements chosen. Since these elements are quite different from each other, it is clear that this ruling is a poor one. Unfortunately, Mr Knopf now appears to have given up in despair and no appeal to the Court of Justice (CJEU) is apparently to be made.

A recent non-use revocation action before the UK Trade Mark Office (Teva Pharmaceutical Industries v Cytochroma Development) reached a rather surprising decision which, if correct, issues a warning to the owners of UK trade mark and CTM registrations protecting words in capital letters.

Teva owned a UK trade mark registration for ALFAD covering pharmaceutical preparations and substances in Class 5. It was granted in 1984. On 2 December 2010, Cytochroma applied to revoke the registration on the ground that the registered mark had not been used in the UK in respect of the registered goods for a period of five years (Section 46 of the Trade Marks Act 1994).

In response Teva filed evidence of their use of the trade mark AlfaD (two capital letters, three lower case letters) in the UK, in respect of pharmaceutical preparations for the treatment of metabolic disturbances, during the period 2003 to 2008. No evidence of use of the trade mark ALFAD was provided. They then argued that the points of difference between the marks ALFAD and AlfaD did not alter the distinctive character of the mark as registered (ALFAD). This argument was not helped however by a written statement made by the commercial director of the registered proprietor to the following effect in her evidence:

“It is to be noted that the AlfaD trade mark is used consistently on all packaging and materials in the form AlfaD. When referred to by name the product is pronounced Alfa-Dee and not Alf-add as might be considered the way it would be spoken on looking at the trade mark registration in plain letters”.

The writer doubts if the applicant to revoke could have put their case for revocation better.

The Hearing Officer decided that the visual and phonetic differences between the registered mark ALFAD and the mark in use AlfaD were significant enough that use of the latter could not be relied upon to prove genuine use of the former.

In the Hearing Officer’s view,

• The (visual) effect produced by the registered proprietor’s use of upper and lower casing represented a marked difference between ALFAD and AlfaD. It caused Alfa to stand out (in AlfaD) in a way it did not in ALFAD;

• Agreeing with the analysis of Teva’s commercial director, the two marks would be pronounced differently, ALFAD as two syllables AL- and –FAD, AlfaD as three syllables, Al-fa-Dee;

• Conceptually, the trade mark AlfaD would be seen as including the phonetic equivalent of the Greek letter alpha. By contrast, ALFAD would be seen as just an invented word.

On this basis, the Hearing Officer revoked Teva’s trade mark registration under Section 46(1)(a) and 46(1)(b) of the Trade Marks Act 1994.

It is accepted that, in certain circumstances, the use of a mark in capital letters would not constitute use of the same mark (for the purposes of Section 46 of the Act) registered in a stylised form (e.g. Bud (capitals) vs. Bud (stylised)). Even this should not be seen as a general rule, however, because, if the stylisation of the registered mark is minimal, the use of the same mark in capital letters could constitute use of a trade mark in a form differing in elements which do not alter the distinctive character of the mark in the form in which it was registered (Section 46(2) of the 1994 Act).

As far as the converse situation is concerned, however, it is surely wrong that the use of a stylised form of a mark does not constitute use (under Section 46) of the same mark registered in capital letters, unless the stylised form is so extreme that it becomes essentially unrecognisable. It is believed that this is (and has been) one of the basic tenets of UK trade mark law and practice, since a UK trade mark register was first established. If this is not the case, then trade mark owners will in future, have to file far more applications to protect variations in the form of the word mark actually used, instead of relying on a single registration (for the word mark in capital letters) which protects most stylised forms of the mark and remains valid and enforceable on the basis of the use made of the mark in various stylised forms. Such a sea change in practice might be good news for the UK Office and for private practitioners, given the increase in filings that would certainly occur, but it would be contrary to the interests of trade mark owners.

Certainly, in the ALFAD case discussed above, the argument that the use of AlfaD constituted genuine use of a trade mark registration for ALFAD could have been much more strongly argued and would have been helped no end if the registered proprietor had not shot themselves in the foot having regard to their comments on the pronunciation of the trade mark AlfaD.

When the European Trade Mark Harmonisation Directive (now 2008/95/ EC) and the Community Trade Mark Regulation (now 2009/207/EC) were introduced in the mid-1990s, it was widely believed that this would be a significant step towards the harmonisation of trade mark law and practice in the European Union.

In some areas, for example in the comparison of trade marks in over 20 different European languages, complete harmonisation was never a realistic prospect. However, in other areas, particularly purely procedural areas, harmonisation should not have been just an optimistic hope, it should have been achieved by now. That it has not been is, in large part, the outcome of a lack of leadership and sensible decision making by the European Court of Justice.

Let me give you an example. In Germany, and a number of other EU countries, opposition to a national trade mark right takes place after, rather than before, registration. Although this in itself exhibits a lack of harmony, one could perhaps accept that position if the national trade mark authorities concerned did not exacerbate the position by introducing yet another anomaly. Even though such (opposed) German trade mark registrations can be enforced against third parties, the German Courts have decided that the five year non-use grace period for such (opposed) registrations should begin, not from the registration (grant) date, but from the date that the opposition procedure has been completed.

This applies across the board, even if only a small proportion of the goods and services claimed have been opposed.

Thus, if a German trade mark registration claiming goods and services in 45 classes was granted on 30 June 2004, then opposed in relation to Class 25 goods, and the opposition procedure was finally completed on 31 March 2008, the five oods and services claimed, not just those in Class 25, would run until 31 March 2013 rather than 30 June 2009. This not only gives the owners of German trade mark registrations a significant advantage over their counterparts in jurisdictions where opposition takes place before registration and who, as a consequence, cannot enforce their rights until (or if) their application is granted, but has also lead to a lack of harmony in CTM opposition proceedings.

This is because OHIM’s practice, when considering the extent of the grace period during which the owner of an earlier, conflicting EU national trade mark right does not have to exhibit genuine use of his trade mark, is to accept the national trade mark office’s (Court’s) practice.

This means, for example, that if a CTM application claiming services in Class 41 was published on 31 January 2012 and was subsequently opposed by the owner of the above German trade mark registration based on that right, the opponent would not have to prove genuine use of his mark in Germany, even though his German trade mark right was granted over seven years ago. This is because the opposition procedure was completed in March 2008, that is less than four years before the CTM application’s publication date. According to German national trade mark practice, and, therefore as a result, OHIM practice, the earlier German trade mark registration is still in its grace period. Because of this practice, there is an unnecessary lack of harmonisation on a key issue, namely “What is the base date from which to calculate the five year non-use grace period under EU trade mark practice?” What could be easier for the European Court to strike a blow for harmonisation than to rule that the non-use base date is the registration date, whether or not a case is opposed after registration. And yet even such a simple step is beyond them as can be seen from the case between Lancome parfums et beauté and Focus Magazin Verlag (T-466/08).

Lancome filed a CTM application for the trade mark Acno Focus in respect of Class 3 goods in July 2003. The application was published for opposition on 5 July 2004. The application was opposed by Focus Magazin based inter alia on a German trade mark registration for Focus in 25 Classes including Class 3.

The opponent’s German trade mark registration had been filed in December 1994 and granted on 23 May 1996. Unfortunately for everyone concerned, except Focus Magazin, the earlier German trade mark registration had been opposed, although not in relation to Class 3 goods, and these opposition proceedings were finally completed on 13 January 2004.

It followed that, when Lancome put Focus Magazin to proof of use of its mark in Germany in the five years prior to the publication date of the opposed CTM application (5 July 2004), the Opposition Division, following the Office’s established practice, found that no such proof of use was necessary, given that the grace period for the opponent’s earlier German right began on 13 January 2004 (the date the opposition proceedings were completed) rather than 23 May 1996 (their registration date).

Having made that decision, the Opposition Division then decided that, since the two marks (Acno Focus and Focus) were confusingly similar and the two sets of Class 3 goods were identical, a likelihood of confusion was inevitable. The opposition was therefore successful and the CTM application was rejected. This decision was confirmed by the Board of Appeal. Lancome appealed to the General Court who spurned the opportunity to harmonise EU trade mark practice in this area.

Accepting the right of the German trade mark authorities to make their own rules regarding opposed German trade mark registrations, the Court merely ratified OHIM’s practice and rejected the CTM application. Given the anomalous nature of this practice and the importance of the issue in CTM opposition proceedings, it is not the registration date and only the registration date, in order to reach another rational, harmonised, position, should constitute a mere moment’s work.

The X Factor is a singing talent contest that has been broadcast on UK television annually since 2004. It is the brain child of the king maker (and queen maker) of British popular music, Simon Cowell. The primary purpose of the tv series is to identify a singer or group who, through the publicity of the series, as well as significant marketing after the series, achieves popular success through record sales and related activities to the benefit of all, including Mr Cowell.

The fact that the UK’s coveted Christmas number one single spot was claimed by the winner of the series from 2005 to 2008 and again in 2010, illustrates the commercial power of Mr Cowell and his series. You would have thought that those involved in a process that is so dominated by commercial considerations would have left no stone unturned when it came to the protection of the names of the singers/groups involved and their right to merchandise those names.

Well, not always, they don’t. One of the leading contenders for the X Factor title in 2011 was an all female group which began life on the programme as Rhythmix. In time honoured fashion, this name was the subject of a CTM application filed by Simco Ltd, a company associated with Mr Cowell. In an unexpected development however, an objection was raised against this application, as well as the group’s use of the name Rhythmix, by a UK music charity trading under the same name. Rhythmix (the charity) helps disabled and vulnerable young people by giving them opportunities to make music.

Faced with the adverse publicity that would no doubt have been garnered if it had entered into a drawn-out and damaging dispute with a charity, a taste of which was experienced with the social media reaction to the story, Simco withdrew their CTM application and the girl band was renamed Little Mix. This change was reflected by a new CTM application being filed for the new name at the end of October 2011. Let’s hope that this application is not opposed. In a heart-warming conclusion to this story, Little Mix were eventually declared the winners of the 2011 X Factor series. In an even more heart-warming denouement to the whole episode, Little Mix were beaten to the UK Christmas number one spot by the Military Wives Choir whose recording of Wherever You Are sold nearly five times as many singles as Little Mix in the week leading up to last Christmas.

In a twist that satisfactorily completed the story, the proceeds of the Military Wives Choir’s sales went to charity (or rather two charities), the British Legion and the Soldiers, Sailors, Airmen and Families Association.

In another round in the Budweiser title fight between US slugger, Anheuser- Busch, and the Czech contender, Budejovicky Budvar, a split decision was declared. Both companies owned UK trade mark registrations for Budweiser covering beer, the later Czech-owned right having proceeded to grant on 19 May 2000 under the old 1938 Trade Marks Act’s honest concurrent user provisions.

One day before the Czech-owned registration had been granted for five years, namely on 18 May 2005, Anheuser- Busch landed a right hander to the head, when it applied to invalidate Budvar’s registration on the basis of its prior UK right.

The Czech fighter responded with spirit by arguing that it had used the trade mark Budweiser on Czech beer in the UK since 1974 and then counter-punched with the claim that the American giant had acquiesced. Under the rules of this particular title bout (aka the Trade Marks Act 1994), a registered trade mark proprietor (in this case Anheuser-Busch) who acquiesces in the use of a later registered trade mark for a continuous period of five years loses the right to invalidate the later registration.

The decision that the referee, the European Court of Justice, was asked to make was, when does the five year period of acquiescence begin? Was it necessary, for example, for the proprietor of the earlier mark to own a registration (for that mark) before he could acquiesce? The referee started by declaring that acquiescence is a European concept that should be applied uniformly across all EU member states.

Further, acquiescence was not the same as consent but involved inactivity by the earlier right holder in the face of a situation which he was in a position to oppose. The referee then set out four conditions to be satisfied before the five year period of acquiescence starts:

• The later mark must be registered in an EU Member State;

• The application for the later mark must have been filed in good faith;

• The later mark must be used by its proprietor in the EU Member State in which it is registered;

• The proprietor of the earlier mark in the same Member State must be aware that the later mark is registered and that it is being used after its registration.

It is not a condition for the five year period of acquiescence to commence however that the earlier mark be registered at the start of that period (of acquiescence). It could be, for example, a pending application during part of the period. Given that Anheuser-Busch had only been aware of the Czech battler’s UK trade mark registration for four years and 364 days prior to its invalidation action (the UK registration had only been on the register for this length of time), it looked like the decision might be going in favour of the Rocky of St. Louis. But no, following a convincing final round showing by the game Czech, the referee ruled that a later trade mark registration should not be declared invalid where there had been a long period of honest concurrent use of two identical marks for identical products since, in these (exceptional) circumstances, the later mark would have no adverse effect on the essential function of the earlier mark, namely to guarantee the origin of goods to the consumer.

It remains to be seen how this contest, which was decided under the Trade Mark Harmonisation Directive (89/104/EEC), is interpreted in bouts fought before OHIM and in EU national trade mark courts.

What is an offensive trade mark under the CTM Regulation? It would appear from two recent decisions, one, Fellenberg and Krauser’s application (R 385/2008-4), before the Fourth Board of Appeal, the other, (PAKI Logistics application; T-526/09), before the General Court, that violent, sexual phrases are more acceptable than racist words.

In the Fellenberg and Krauser case, the mark at issue was a stylised form of the phrase Fucking Hell for goods in Classes 25, 32 and 33. The CTM Examiner raised an objection under Article 7(1)(f) of the Regulation on the basis that the mark was contrary to public policy or to accepted principles of morality, particularly in the English speaking parts of the EU.

The applicants argued that Fucking was a small village in Upper Austria, whilst hell alluded (in German) to a lager beer. The Examiner pointed out that the Austrian village had a population of 93 and that there had to be limits to how offensive a registered trade mark should be. The Article 7(1()f) objection was therefore maintained.

The applicants appealed. The Fourth Board of Appeal reversed the Examiner’s decision and allowed the mark. According to the Board, the trade mark applied for did not contain any “semantic indication that could refer to a specific person or group of persons”, neither did it incite a particular act. Further, in the Board’s view, it was not reprehensible to use an existing place name merely because it may have an ambiguous meaning in other languages.

This decision should be contrasted with the General Court’s decision (T-526/09) involving a CTM application for the word mark PAKI in respect of goods and services in Classes 6, 20, 37 and 39. Once again, the CTM Examiner had raised an Article 7(1)(f) objection but, on this occasion, the First Board of Appeal had upheld it on the basis that the word Paki is a racist word that is used pejoratively, in particular by certain sections of the UK public, for Pakistanis or, more generally, anyone from the Indian sub-continent.

PAKI Logistics, who have traded under the name PAKI in Germany and elsewhere for nearly 40 years, appealed to the European Court. Before the Court, the CTM applicant argued that the public perception of the word Paki had changed to the point where it was even used by the Pakistani community in the UK.

The General Court was not persuaded. In the Court’s view, based on the evidence before it, the word Paki would still be perceived by the UK public as a racist term. The objection was therefore maintained and the CTM application refused.

In the writer’s view the PAKI Logistics decision was correctly decided. This is something that cannot be said for the decision of the Fourth Board of Appeal. Violent words can lead to violent actions. That is why social (and legal) constraints are placed on the use of some words and phrases. Whilst the standards applied to the use of this type of word or phrase have changed over the past decades, it would still be extremely unusual for a phrase such as Fucking Hell to be used in general conversation. So, whilst it is difficult to prevent the likes of Herr Fellenberg and Herr Krauser from producing a Fucking Hell beer that will no doubt be aimed at the testosterone fuelled, young male market, it seems perverse in the extreme to give such commercial activities official approval.

One of the German equivalents of the English verb “to fuck” is the word Ficken. The German company, EFAG TM Company, has recently filed three CTM applications for Ficken (word) and Ficken Liquors logo in a number of Classes including Classes 25, 32 and 33. All three CTM applications have been refused under Article 7(1)(f) of the CTM Regulation which strongly suggests that the Fucking Hell decision may be being treated with caution by the OHIM Examination Division. One of these refusals (CTM 10142123) has now been appealed to the First Board of Appeal. It is strongly to be hoped that the First Board takes a more enlightened view of the official acceptability of such words (and phrases) and rejects this CTM application.

The XIV modern Summer Olympics took place in London in 1948 at a cost of £750000. No new Olympic stadiums were built, nor was an Olympic Village erected. The athletes were housed in military camps, schools and other publicly owned accommodation. At the time, postwar food rationing was an everyday part of life and the food for competitors was therefore basic British stodge.

The XXX Olympiad due to take place in London in July/August 2012 will not be like that. The cost of organising the Games has already risen above £10 billion and is set to climb still higher. Whilst most of this money comes from public funds (that is, from me and my fellow UK citizens), significant contributions also come from broadcasters and official sponsors. Sponsorship money comes at a price; these days that is the price of preventing ambush marketing.

Ever since Nike constructed a Nike Village next to the Olympic Village in Atlanta in 1996 and, as a result of this coup, achieved a higher recognition as a sportswear sponsor of the Games, which there weren’t, than the official sponsor, Reebok, the Olympic authorities have taken a very dim view of such unauthorised activities. The result is that, since the Sydney Games in 2000, they have insisted on draconian legislation being introduced by the host country to stop, or at least to seriously inhibit, this type of marketing.

Over the past 5 years, the British Government has introduced the London Olympic Games and Paralympic Games Act 2006, as well as a number of amendments to that Act. This Act now not only prevents businesses, who do not have the prior authorisation of LOCOG (the London Organising Committee of the Olympic Games), from creating an “association” between themselves and the London 2012 Games by, for example, using combinations of words such as Games and Twenty Twelve with words such as London, Gold and Summer, they also restrict unofficial advertising in particular areas (and on particular buildings) during certain periods of summer 2012.

Be it an unauthorised advert beamed on to Big Ben, Richard Branson turning up to the 100 metres final wearing a Virgin t-shirt, Nike giving away branded baseball caps to spectators heading to Olympic events or aircraft trailing banners for Ryanair flying over the restricted zones, they will all be caught by the legislation.

Although it rather spoils the fun, one could perhaps put up with these restrictions on the basis that it slightly reduces the cost of the elephantine event to me (and my fellow citizens). However, there is an absolutely unjustifiable aspect to these provisions. This is the real possibility that criminal proceedings could be brought against the perpetrators, as well as against the directors or managers of the companies involved. If counterfeit products are not involved, then these are not criminal acts, except in the eyes of the Olympic “family” and the British Government. They should be dealt with in civil proceedings, and with fines, not as a crime leading to a criminal record.

It is to be hoped that an over-zealous functionary will bring a criminal case under the provisions of the 2006 Act, at an early stage of the Games, and that, in the light of the outrage and bad publicity that follows, a more sensible and sympathetic (and civil) approach to these matters is then taken by the authorities.

Anyone who would like advice on the minefield of legislation surrounding the 2012 Games and its impact on ambush marketing and other related matters, should contact the Jenkins Trade Marks Department.

Here’s another view on the “goods in transit” case discussed in the leading article of this edition on Make Your Mark.

The fight against the crooks who manufacture and sell counterfeit and pirated goods was dealt a body blow by two recent decisions of the European Court (Joined cases; Philips Electronics v Lucheng Meijing (C-446/09) and Nokia v Her Majesty’s Commissioners of Revenue and Customs (C-495/09)).

In the Nokia case, the facts were these. A shipment of fake Nokia branded phones, on their way from Hong Kong to Colombia, had made a transit stop at London’s Heathrow airport. Nokia became aware of the counterfeit products and asked HM Revenue & Customs (HMRC) to seize them under the EU Customs Regulations (1383/2003). HMRC refused to do so, taking the position that such goods in transit could not usually be classed as counterfeit within the terms of the Regulation. HMRC maintained that they would only act in such cases if there was strong evidence that the goods might be diverted onto the EU market.

Nokia, not surprisingly, were not happy with this interpretation of the EU Regulation and sought a High Court judicial review of HMRC’s decision. Unfortunately, the Judge (Mr Justice Kitchin) ruled in favour of HMRC on the following basis:

(i) Goods in transit through the EU, that were not destined for the EU, did not fall within the definition of counterfeit goods set out in the EU Customs Regulations. They could therefore not be seized under the Regulation, even if they were in fact counterfeit. The mere risk that the goods could be diverted into the EU was not enough to justify seizure.

(ii) In order to succeed in a trade mark infringement action, a trade mark proprietor had to show that goods, even counterfeit goods, had been put on the EU market. Goods in transit, in the absence of, for example, clear evidence that they might be diverted, could not be classed as infringing goods. In reaching this decision, the Judge relied on two earlier decisions, Eli Lilly v 8PM Chemist and L’Oreal v eBay International.

(iii) The EU Customs Regulation (1383/2003) had not introduced new tests for deciding whether or not a mark was being used in the course of trade or for judging the existence (or otherwise) of trade mark infringement.

Nokia appealed to the Court of Appeal and that Court sought a ruling from the European Court on the question of whether or not counterfeit goods, manufactured in a non-EU country and in transit through the EU to another non-EU country, could be detained, and subsequently destroyed, by EU Customs authorities on the basis of relevant EU trade mark rights, if there was no evidence that the counterfeit goods would end up on the EU market (for example, by illicit diversion).

Similar questions were posed by the Belgian Court in the Philips case. That action involved electric shavers that had been manufactured in China. The shavers resembled the designs of Philips branded shavers and were therefore suspected of being pirated goods. The shavers were detained by Belgian Customs authorities, even though there was no clear evidence that these “pirated” goods were destined for the EU market. Philips sought a ruling from the Belgian Court that the Chinese manufactured shavers infringed their (Philips) EU designs and copyright and requested that the “pirated” goods be destroyed. The Belgian Court sought guidance from the European Court on the status of the Chinese shavers which were allegedly in transit. In particular, the Belgian Court asked whether they could decide the issue by making the (false) assumption that the shavers had been manufactured in Belgium.

The Court refused to take the opportunity to stretch the wording of the two Custom Regulations involved (No. 3295/94 in the Philips case) and (No. 1383/2003 in the Nokia case) for the greater good.

Instead they interpreted both Regulations narrowly and ruled as follows:

• Goods coming from a non-member State which are imitations of goods protected in the European Union by a trade mark right or copies of goods protected in the European Union by copyright, a related right or a design cannot be classified as ‘counterfeit goods’ or ‘pirated goods’ within the meaning of those Regulations merely on the basis of the fact that they are brought into the customs territory of the European Union under a suspensive procedure;

• Those goods may, on the other hand, infringe the right in question and therefore be classified as ‘counterfeit goods’ or ‘pirated goods’ where it is proven that they are intended to be put on sale in the European Union, such proof being provided, inter alia, where it turns out that the goods have been sold to a customer in the European Union or offered for sale or advertised to consumers in the European Union, or where it is apparent from documents or correspondence concerning the goods that their diversion to European Union consumers is envisaged;

• In order that the authority competent to take a substantive decision may profitably examine whether such proof and the other elements constituting an infringement of the intellectual property right relied upon exist, the customs authority to which an application for action is made must, as soon as there are indications before it giving grounds for suspecting that such an infringement exists, suspend the release of or detain those goods; and

• Those indications may include, inter alia, the fact that the destination of the goods is not declared whereas the suspensive procedure requested requires such a declaration, the lack of precise or reliable information as to the identity or address of the manufacturer or consignor of the goods, a lack of cooperation with the customs authorities or the discovery of documents of correspondence concerning the goods in question suggesting that there is liable to be a diversion of those goods to European Union consumers.

Whilst this ruling offers IP rights owners some grounds for challenging counterfeit or pirated goods that are in transit through the EU, it would appear, from the Nokia case before the English High Court however, that the level of proof required to show that goods in transit are likely to be diverted into the EU market is extremely high.

It would have been far better if the European Court had interpreted the words of the relevant Regulations to allow the detention and destruction of counterfeit and pirated goods that are in transit through the EU. When the outcome is a blow against the non-tax paying, money-laundering criminal fraternity, it seems to the writer that any interpretation of an EU Regulation, however stretched, would be a fair one.

Recognizing the importance of this issue and therefore seeking to provide a sop to the IP owning community, the Court did comment (at paragraph 65 of its judgment) that, with regard to suspicious goods in transit that were unlikely to be diverted into the EU, but were destined for a non-EU country where the IP owner did have relevant rights, the EU customs authorities involved could cooperate with the customs authorities of the non-EU member state “with a view to removing those goods from international trade where appropriate”.

Right, and pigs might fly!

This whole area was one part of the Max- Planck review of EU trade mark law and practice. It is seriously to be hoped that, as a result of that review, the relevant EU Customs Regulations will be amended as a matter of urgency to allow the customs authorities to detain and to destroy counterfeit and pirated goods that are passing though the EU as well as such goods that are destined for the EU.