In Alfredo Nuno v. Leonci Franquet, the European Court of Justice (ECJ) was asked to consider the provisions of the Trade Marks Directive 89/104/EEC of 21 December 1988, which deal with the effect of an earlier unregistered mark on a subsequent trade mark registration. In order for an earlier, unregistered trade mark to have prior rights over a later registration under Article 4(2)(d) of the Directive, so as to make the later mark liable to be declared invalid, the earlier trade mark must be "well known in a member state, in the sense in which the words 'well known' are used in Article 6bis of the Paris Convention". Article 6bis defines a well-known mark as "…a mark considered by the competent authority of the country of registration or use to be well known in that country...".
Article 6(2) of the Directive prevents a trade mark proprietor from enforcing his trade mark against a third party who is using an earlier right which applies only in a particular locality if that right is recognised by the laws of the member state in question.
The proprietor of the Spanish registered trade mark FINCAS TARRAGONA, registered for various property services, brought a trade mark infringement action against an estate agent in Tarragona; Mr Franquet. Mr Franquet had been using the unregistered signs FINCAS TARRAGONA and FINQUES TARRAGONA (in Catalan) as trading names since 1978 in the city of Tarragona and the surrounding area. In response, Mr Franquet tried to revoke the registered trade mark on the grounds of his prior use of an identical or similar mark which is well-known in the territory.
Following the requirements of Article 4(2)(d) of the Directive, Article 6 of the relevant Spanish Trade Mark Law prevents registration of a trade mark which conflicts with an earlier trade mark and defines earlier trade marks to include: "non-registered trade marks which, on the date of filing or priority of the application for registration of the trade mark under consideration, are well known in Spain, in the sense in which the words "well known" are used in Article 6 bis of the Paris Convention."
The Spanish national court asked the ECJ, in essence, whether in assessing whether a mark is well-known in a member state for the purposes of article 4(2)(d) of the Directive this could cover being well known in just an "autonomous community, region, district or city" defined by reference to the market of the goods or services in question.
In the instant case, the geographical market for the services in question was Tarragona and the surrounding area. The city and surrounding area has a population of approximately 350,000. The national court had interpreted Article 4(2)(d) as requiring the earlier mark to be known either throughout Spain or in a substantial part of Spain and had held that Tarragona and its surrounds were not a substantial part of Spain.
The ECJ interpreted the question as asking whether article 4(2)(d) of the Directive covers a situation where a high level of knowledge of the earlier trade mark only exists in a city and its surrounding area. It concluded that such knowledge would only be sufficient if the relevant area amounted to a "substantial part" of a member state. The ECJ seemed to take for granted the conclusion of the national court that Tarragona and its surroundings were not a substantial part of Spain.
In reaching the conclusion that the Directive required the mark to be known in the whole or a substantial part of a member state, the ECJ was influenced by the decision in General Motors (Case C-375/97) which applied a similar construction to the provisions of Article 5(2) of the Directive which refers to a mark which "has a reputation in a Member State".
In reaching its decision, the ECJ refused to follow the Opinion of Advocate General Paolo Mengozzi, who had recommended that Article 4(2)(d) should cover not only unregistered marks which are known throughout a member state or in a substantial part, but also marks which are well known in a smaller geographical region. The ECJ preferred instead to follow its own narrower interpretation of what is meant by 'in the Member State' in the context of assessing the extent of the reputation enjoyed by a trade mark.
However the ECJ also noted that the provisions of Article 6(2) of the Directive could protect the owner of an earlier localised non-registered mark. This provision does not require the earlier mark to be 'well-known in the country'.
This ruling clarifies that Article 4(2)(d) applies to mark known in the whole of a member state or a substantial part, but does little to clarify what amounts to a "substantial part". World Intellectual Property Organization guidelines suggest that this is not simply a geographical question but also encompasses issues of numbers of people who know the mark or to whom it has been advertised.