Facts

The applicant in a recent case applied to register a figurative colour mark featuring the words 'Be impulsive' in Classes 3 and 5.

An opposition action was filed by the owner of the prior international and EU mark IMPULSE (Figure 1), which was registered in Class 3. The opponent proved use of the mark on deodorants in Hungary and elsewhere, as well as evidence of the mark's reputation in the United Kingdom and Italy.

Figure 1

Decisions

The Hungarian Intellectual Property Office (HIPO) granted the opposition and refused the applied-for mark's registration in both classes. The HIPO held that the opponent had proved the prior mark's reputation in a substantial part of the European Union. Further, use of the applied-for mark was likely to result in an unfair advantage for the applicant or be detrimental to the prior mark's distinctive character or reputation.

The applicant requested a review by the Metropolitan Tribunal, contesting the HIPO's statement on reputation and, in particular, its significance for Hungary if reputation could be proved only in other EU member states. As the tribunal had doubts in this regard, it referred the case to the European Court of Justice (ECJ) along with four questions.

In essence, the ECJ's response to the four questions was as follows:

If the earlier European mark has already acquired a reputation in a substantial part of the territory of the European Union, but not with the relevant public in the Member State in which registration of the later national mark concerned by the opposition has been applied for, the proprietor of the European mark may benefit from the protection introduced by TM Directive. (C-125/14, Paragraph 34.)

On receiving the ECJ's preliminary ruling, the Metropolitan Tribunal rejected the applicant's request for review. It held that although the percentage of the UK population with knowledge of the trademark (ie, 5%) did not seem high, the United Kingdom is the third-largest EU member state in respect of population size and thus represents a relatively large part of the European Union. In respect of the mark's reputation, the tribunal held that as the deodorant market is competitive, it is much more difficult to acquire reputation compared with another, less competitive market. Thus, in conformity with the ECJ's ruling, the tribunal held that the applicant's use of a similar mark would be detrimental to the prior mark and could dilute its reputation.

The applicant filed an appeal with the Metropolitan Court of Appeal, but this was unsuccessful. The court held that the prior mark's reputation had been proved. Further, the prior mark may have been known by the average Hungarian consumer when the applicant filed its registration. Contrary to the applicant's argument, it is not the use of a prior mark which is important, but rather whether the mark is sufficiently known by consumers. A positive assessment of the prior mark's reputation will contribute to the danger of confusion.

The applicant filed a request for revision with the Supreme Court, but this was rejected (Pfv. IV.21.873/2017).

Comment

This was the first trademark case to be referred to the ECJ by a Hungarian court. It is therefore understandable that the case was openly discussed by legal scholars before it had been concluded.

The key question in this case was new – namely, whether an EU mark which is not well known in the country of application but reputed in other EU member countries (more precisely, in a significant part of the European Union) can be protected as a reputed mark.

The ECJ's detailed answer reflects the principle of unity (Article 1(2) of the EU Trademark Regulation), which is extended to the interpretation of the notion of reputation in a substantial part of the European Union. The Hungarian courts correctly applied the ECJ's judgment, even though it was unusual for them.

Notably, the applicant in this case was able to protect its mark in Classes 5 and 16 (but not Class 3 (ie, cosmetics)) by making a distinct change – namely, changing the text to 'Be impulsive by Nicole'.

For further information on this topic please contact Alexander Vida at Danubia Patent & Law Office LLC by telephone (+36 1 411 8700) or email (vida@danubia.hu). The Danubia Patent & Law Office website can be accessed at www.danubia.hu.

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