The EU Court of Justice (ECJ), with decision of March 6th, 2014 (Case C-409/12), shed new light on the issue of trademark genericization by drawing the boundaries of the concept of “relevant public” and by clarifying the relevance of the “inactivity” of the trademark holder.
The case at issue regarded the alleged vulgarization of the trademark “Kornspitz”, registered by an Austrian company for a particular kind of cereal flour and for bakery products.
According to a competitor of the trademark owner, due to the large-scale use of the “Kornspitz” products among bakers in Austria, the term has become a generic designation for a characteristic bread roll, well known among consumers, this exposing the trademark to revocation under Austrian Law for loss of distinctive character.
The case is of particular interest since the “Kornspitz” trademark had been registered for two categories of products (the flours on one side, and the finished products on the other side), so having two different kind of “target consuming public” (i.e. the bakery industry for the flours and the end-consumers for the finished products).
The ECJ, therefore, clarified that, in such cases, for the purposes of the genericization test, the public of end-consumers plays the most critical role, being their perception the sole capable to determine whether a trademark had preserved or not its essential distinctive function.
According to ECJ, indeed, the fact that intermediaries involved in the distribution process of the products (in this case, bakers and retailers) are well aware of the existence of a trademark is not relevant in order to exclude the genericization of the trademark.
In fact, it is always a duty of the trademark holder to encourage its retailers to actively and properly use the trademark in order to inform the end-buyers of its existence and of the origin of the goods.
Consequently, if the trademark owner fails to do so or tolerates a lenient approach from its retailers, such attitude qualifies as a fatal “inactivity” capable to provoke the genericization.
Finally, the ECJ affirmed that the public perception by end-users overcomes also the possible existence, in the common language, of different designations for the product originally distinguishable by the contested trademark.