Intellectual Property

The CJEU rules on acquired distinctiveness of a trademark

In its Oberbank decision (Joined Cases C-217/13 and C-218/13) of 19 June 2014, the Court of Justice of the European Union (CJEU) clarified the criteria for registering a trademark on the basis of acquired distinctiveness.

In the case, the German bank Deutscher Sparkassen, was the proprietor of a single-colour trademark of a shade of red registered in 2007 which it had been using as its corporate colour for several decades.

In 2009 and 2012, the applications by two competing banks, Oberbank and Santander, to declare the registration invalid based on lack of distinctive character were rejected by the German Patent and Trademark Office (GPTO). On appeal, the German Federal Patent Court (GFPC) decided to refer several questions relating to the interpretation of Article 3 of the Trademarks Directive 2008/95/EC to the CJEU for a preliminary ruling.

Firstly, the GFPC asked whether the interpretation of national law may require consumer recognition of 70 % for an abstract color mark. The CJEU ruled that 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. Therefore, the interpretation of Article 3 (1) and (3) precludes any interpretation of national law which requires a fixed 70 % recognition.

Secondly, the GFPC asked if the time of filing of the application for registration is decisive even if the proprietor claims that the mark acquired a distinctive character after the application but prior to registration. The CJEU ruled that distinctive character shall, as a rule, be acquired before the date of the filing of the application. Since Article 3 (3) allows Member States the option to extend protection to distinctiveness acquired after filing of the application, or after registration of the mark, unless a Member State has exercised this option, the main rule shall be interpreted literally.

Thirdly, the GFPC asked whether a trademark shall be declared invalid if it can no longer be clarified whether it had acquired a distinctive character at the time of the application. The CJEU ruled that the burden of proof is on the trademark proprietor, i.e., a mark shall be declared invalid where the proprietor has failed to show that the mark had acquired a distinctive character before filing.

The Swedish Supreme Court provides guidance on classification of trademark crimes 

The Swedish Supreme Court has in a recent trademark infringement case (B 5484-13) provided guidance on classification and penal value of trademark crimes.

In this case a man was convicted in both the Swedish District Court and the Swedish Court of Appeal for trademark infringement since he intentionally had used trademarks which were identical or confusingly similar to another company’s registered community trademark (by sale of counterfeit goods). The main issue in the Supreme Court was defining the penalty for the infringement. The prosecutor argued that trademark infringement is a so-called “type crime” (in Swedish “art brott”), i.e. a crime for which a prison sentence is always presumed. However, the Supreme Court concluded in this judgment (after a detailed explanation of the concept in criminal law) that trademark infringement is not a type crime and the sentence in this case was therefore limited to probation.

The judgment may have an impact on the fight against counterfeiting and piracy since the Supreme Court has now concluded that a prison sentence shall not always be presumed in such trademark infringement cases.

Permissible use of a third party trademark 

The Swedish Supreme Court has in a recent decision (T 301-12) provided guidance regarding permissible use of a third party’s trademark. The case concerned the companies Mon.Zon Sverige AB(“Mon.Zon”) and Layher Aktiebolag (“Layher”), two competitors within construction scaffolding. In MonZon’s product catalogues for 2007-2009, there was a photo depicting a close-up of assembled scaffolding. One of the bars of this scaffolding had a label with the text “LAYHER”. The photo at issue was only a small part of the more than 60 pages long product catalogues.

Layher brought action against MonZon claiming that the use of the registered trademark LAYHER in the described way constituted trademark infringement. MonZon objected to the alleged infringement on the basis that the trademark had not been used as a sign for Mon.Zon products and that the product catalogue photo only showed that the different products were compatible with each other. The Supreme Court concluded that MonZon was not liable for trademark infringement.

In the judgment, the Supreme Court sets the threshold for “use in the course of trade” of a trademark at a low level. However at the same time, it interprets applicable EU case law as meaning that trademark protection in cases of double identity is focused on the protection of norms and that there, consequently, is no infringement when no damage to any the functions of a trademark can be shown by the proprietor. As there was no shown damage to any of the trademark’s functions, the Supreme Court concluded that no infringement was at hand. Observing this burden of proof in trademark infringement cases will be important for trademark proprietors in future cases.

European data protection and the Google case - The Article 29 Working Party guidelines 

The landmark case C-131/12 Google Spain SL, Google Inc. v Agencia Española de Protección de Datos, Mario Costeja González from Court of Justice of the European Union (CJEU) from 13 May 2014 stated that search engine providers are data controllers in respect of the processing of personal data carried out by the search engine. The CJEU also confirmed that the Directive 95/46/EC on the protection of personal data applies to search engines and that web users have the right to directly request the search engine to delete the links to web pages that contain information breaching their rights under the Directive.

The Article 29 Working Party is an advisory body composed of representatives of the national data protection authorities (DPA), the European Data Protection Supervisors and the European Commission. As a reaction to the case, the EU data protection authorities that are part of the Article 29 Working Party arranged a meeting at the end of summer and met the representatives of Google, Microsoft and Yahoo! in order to obtain input from these entities to the upcoming WP29 guidelines.

The goal of the WP29 guidelines is to ensure a consistent handling of complaints of European data protection authorities that face requests that individuals file due to receiving delisting refusals by search engines. The wider goal of the guidelines is to ensure the consistent and uniform implementation of the ruling and to instruct how search engines frame their actions relating thereto. The WP29 guidelines are expected to be published this autumn. 

CJEU: Internet browsing is exempt from copyright infringement 

The Court of Justice of the European Union (CJEU) has given a preliminary ruling in the Meltwater Case (C-360/13), a 5-year-long dispute between the Newspaper Licensing Agency (NLA) andMeltwater and the Public Relations Consultants Association (PRCA). The CJEU confirmed UK Supreme Court's position that copies both on screen and in cache are temporary copies and exempt from copyright infringement under Article 5(1) of the Information Society Directive.

The lawsuit originates back to 2009 when PRCA challenged the adequateness of licensing terms sought by the NLA, representing major UK newspaper publishers. The temporary copying question was referred by the UK Supreme Court to the CJEU in May 2013 who in June 2014 issued their decision. CJEU held that the interpretation of Article 5(1) entails that the copies on the user’s computer screen and the copies in the Internet ‘cache’ of that computer’s hard disk, made by an end-user in the course of viewing a website, satisfy the following conditions: the copies must be temporary, they must be transient or incidental in nature and that they must constitute an integral and essential part of a technological process. Also the copies shall satisfy the conditions laid down in Article 5(5) of the directive and they may therefore be made without the authorization of the copyright holders.

The decision should secure business models that rely on providing services via the Internet, since according to the ruling the service providers or their users are not infringing copyright simply by browsing freely accessible copyrighted material on the Internet. However, other use such as downloading or printing out the on-screen material, will not be within the exception’s parameters.

The Meltwater ruling forms a case law family through which the CJEU is outlining the Articles of the “InfoSoc” Directive, giving the norm requisite context. A recent ruling regarding the concept of parody (Case C-201/13, Deckmyn and Vrijheidsfonds v Vandersteen and Others), follows that path.

The CJEU defines the concept of parody 

The Court of Justice of the European Union (”CJEU”) gave on 3 September 2014 a preliminary ruling in case C-201/13 regarding the interpretation of Article 5(3) (k) of Directive 2001/29/EC on the harmonization of certain aspects of copyright and related rights in the information society. The CJEU ruled that the concept of “parody” is an autonomous concept of EU law and it should thus be interpreted uniformly in all Member States.

In the judgment, the CJEU defined two essential characteristics of parody. First, parody must evoke an existing work but also be noticeably different from it. Secondly, it must constitute an expression of humor or mockery. The CJEU also stated that holders of copyright and related rights have a legitimate interest in ensuring that the protected work is not associated with a discriminatory message by means of parody.

The Court of Justice of the European Union: retail services may be registered as a trademark 

The Court of Justice of the European Union (CJEU) has ruled on 10 July 2014 in case C-420/13 Netto Marken-Discount AG & Co. KG Deutsches Patent- und Markenamt that a retailer's activity of bringing different services together qualifies as a service for which it is possible to register a trade mark.

In the case it was stated that bringing together a variety of services enables customers conveniently to purchase those services and is considered a service in itself. This applies even when the services brought together also cover services that the trade mark applicant itself provides. The CJEU held it is not necessary to specify in detail each of the activities that construe the "bringing together" service. However, it is necessary to identify the services brought together clearly and with precision.

Marketing and Consumer

The Swedish Market Court prohibits misleading and unfair marketing

The Swedish Market Court has in two recent decisions prohibited misleading and unfair marketing under the Swedish Marketing Act (2008:486).

In one of the cases (MD 2014:6) the Court approved a claim brought by Absolut Vodka to prohibit Purity Vodka to use certain statements including “THE WORLD’S MOST AWARDED” which the Court concluded to be misleading and unfair. The Court also prohibited the use of diagrams comparing different vodka brands, without making references to the source or without providing description of the method used for such comparison.

In the second case (MD 2014:8) the Court approved a claim brought by the Swedish Consumer Ombudsman to prohibit marketing of certain food supplements stated to possess significant health benefits and to alleviate specific health conditions. The products had been marketed by a company called D-service on its website “Naturens val” as well as in direct advertisements to consumers under the brand names “Juventol”, “Ledomax” “Cupido” and “Touchi”. As the company did not succeed in proving the claimed health benefits of the supplements the Court considered the marketing to be unfair and misleading. In line herewith the marketing activity was determined prohibited under penalty of a fine of 1 million SEK. It should be noted that the company in its plea stressed that it had already agreed to change its marketing according to the claims of the Consumer Ombudsman before the case was issued before the Court and therefore argued the case to be unnecessary and unjustified.

However, the Court concluded the case to be motivated since the company had not changed its marketing rapidly enough after the complaints of the Consumer Ombudsman and that it had not cooperated sufficiently in the matter before the authority. Accordingly, the Consumer Ombudsman was considered the winning party of the case and the company was ordered to pay the litigation costs of the Consumer Ombudsman, which amounted to 25 0000 SEK.

The Swedish Market Court dismisses a claim brought by the Consumer Ombudsman to prohibit marketing of installment plans 

The Swedish Market Court has in its recent decision (MD 2014:7) dismissed a claim brought by the Consumer Ombudsman to prohibit Media-Saturn Nordic Shared Services AB (Media Markt) to market installment plans directed towards consumers purchasing electronic goods.

The court held that it did not matter that the offer was considered to be beneficial (the installment plans did not include any interest or fees) since the average consumer, according to the Court, should not lack the ability to calculate the installment plans’ impact on the economy. The Court concluded that the marketing activities were neither misleading, nor intrusive. Therefore the installment plans were not considered to be in contrary to good credit or marketing practices.

Finnish Market Court ruling on inappropriate marketing 

The Finnish Market Court has in its recent case from 29 August 2014 (MAO:605/14) prohibited unclear television advertising. The Court considered the so called “small print” at the bottom of the TV screen as unclear advertising.

If a consumer is able to purchase the service marketed on television immediately on the basis of a television advertisement, inappropriateness of the marketing shall be assessed with respect to the information given in the advertisement. Since the small print is unreadable, the Market Court concluded that the situation equals to one where there is no preliminary information, required in the Consumer Act (38/1978), given at all.