Advocate General Szpunar has recently given his opinion on the question of whether Christian Louboutin’s registration for the red sole of a high-heeled shoe should be declared invalid under Article 3(1)(e)(iii) of the EUTM Directive.
The mark is currently registered in Benelux as consisting ‘of the colour red (Pantone 18 1663TP) applied to the sole of a shoe as shown’:-
Click here to view image.
An invalidity action has been filed against the mark by Van Haren Schoenen BV on the ground that the mark consists exclusively of ‘the shape which gives substantial value to the goods’ (Article 2.1(2) of the Benelux Convention and Article 3(1)(e)(iii) of the Directive).
Van Haren filed the action after it was found liable for infringement of Louboutin’s mark by the Rechtbank Den Haag (District Court of The Hague, Netherlands), following its sale of red soled high-heeled shoes in 2012.
Before ruling on the invalidity, the Rechtbank Den Haag sought clarification from the CJEU on whether the notion of ‘shape’ within Article 3(1)(e)(iii) of the Directive is limited to the three-dimensional properties of the goods, such as their contours, measurements and volume, or if ‘shape’ can also include other properties of the goods, such as their colour.
Advocate General Szpunar has recently provided his opinion on this point. His opinion considers the continual balancing act between the protection of trade mark rights, as an essential part of the system of competition that EU law seeks to establish and maintain, and the fact that a registered mark grants an exclusive right to the proprietor to monopolise the registered sign for an unlimited period.
Where a sign cannot be dissociated from the appearance of the goods these two factors conflict, and the registration of such a sign could limit the ability of others to bring competing products onto the market. The objective behind Article 3(1)(e) of the Directive is to prevent such a monopoly being created over technical solutions or functional characteristics of a product, which a consumer might seek in the product of a competitor, so that these are kept within the public domain.
Taking the above into account, AG Szpunar held that if signs consisting of both the shape and the colour of the goods could not be examined from the point of view of their functionality, then the general interest underpinning Article 3(1)(e) of the Directive would not be fully served.
Colour can be an essential practical characteristic of certain goods, for example on a fire extinguisher or reflective safety clothing, such that the monopolisation of a colour in relation to an element of the shape of the goods would remove the freedom of competitors to offer goods incorporating the same functionality. As such, signs in which colours are integrated into the shape of the goods must be subject to the functional analysis provided for by Article 3(1)(e) of the Directive. This is in line with the principle that the assessment of a sign should be based on the overall impression it produces.
In his opinion, AG Szpunar considered Louboutin’s mark to be a mark better conceptualised as consisting of the shape of the goods, but seeking protection for a certain colour in relation to that shape, rather than a per se colour mark. This is because protection of the colour within the mark is not sought in abstract, but for use on the sole of a high-heeled shoe, as shown within the graphic representation of the mark. If the CJEU follows AG Szpunar’s opinion, then Louboutin’s mark will likely be declared invalid under Article 3(1)(e)(iii) of the Directive.
However, Louboutin may be able to rely on several points raised by AG Szpunar within his opinion, in defence of the ground raised under Article 3(1)(e)(iii), in that the concept of a shape which ‘gives substantial value’ to the goods within the meaning of the provision, relates only to the intrinsic value of the shape and must not take into account the attractiveness of the goods flowing from the reputation of the mark or its proprietor. Therefore, Louboutin could argue that the substantial value of its mark comes not from the shape and colour combination, but the reputation that the mark has developed through its use on Louboutin products.
Further, AG Szpunar stated that it is important to bear in mind that, according to settled case law, the grounds for refusal contained in Article 3(1)(e) of the Directive do not prevent registration of a sign which, although consisting of a shape of goods, also incorporates a significant non-functional element. AG Szpunar said that the question of whether or not, in a shape and colour mark, colour is a functional element must be considered as part of the overall assessment of the sign.
It will be interesting to see if the CJEU follows AG Szpunar’s opinion in this matter.