In an Order on 17 February 2016 (Shoe Branding Europe v adidas in Case C-396/15 P*) the Court of Justice of the European Union (“CJEU”), Europe’s highest Court, confirmed a decision of the General Court upholding adidas’ opposition against Shoe Branding’s Community trademark (“CTM”) application for two stripes positioned on a shoe. The Order confirmed the General Court’s finding that the trademark applied for was similar to adidas’ 3-stripes mark on footwear, and that there was both a likelihood of confusion and dilution under Articles 8(1)(b) and 8(5) of the CTM Regulation.

In 2009 Shoe Branding filed a CTM application for the following position mark for footwear in class 25:

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adidas opposed based on a number of its prior rights to the 3-stripes mark protected for identical goods, including the below CTM:

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The opposition was dismissed by OHIM’s Opposition Division and by the Board of Appeal, which held that adidas’ 3-stripe mark could enjoy protection only against identical or virtually identical reproductions, and that in the present case the differences in the details in the positioning (i.e. instep versus area between laces and sole), sloping (i.e. inclination) and the number of stripes, were sufficient to dispel any likelihood of confusion. Applying the same similarity test, the Board of Appeal also held that these dissimilarities were sufficient to dispel a risk of a link being made between the marks and so the application could not take unfair advantage or be otherwise detrimental to the distinctive character or repute of adidas’ 3-stripes mark.

adidas successfully appealed to the General Court in Case T-145/14. The General Court ruled that the Board of Appeal unduly focused on what seemed minor differences between the marks which would not be noticed by consumers. The Court further noted that the Board did not explain why all the other elements of similarity between the marks, such as the shape, size and colour of the stripes and their positioning on the outside of a shoe were not seen as relevant in the Board’s comparison. After carrying out a global assessment of the signs and taking into account these similar elements, the General Court held that the Board was wrong to say the marks were dissimilar. In addition, given that adidas had shown reputation in its three parallel stripes, the Court found that this was also a relevant factor to support both a finding of a likelihood of confusion under Article 8(1)(b) CTMR as well as infringement of Article 8(5) CTMR, which were both made out.

Not satisfied with the decision of the General Court, Shoe Branding appealed to the CJEU. Its appeal was turned down on all the grounds by the CJEU as it was found partially manifestly unfounded and partially manifestly inadmissible.

This case demonstrates that position marks and other non-traditional trademarks can be very effective tools for famous brand owners to use against those who copy their trade dress in the EU.