POSITION MARKS IN THE SPOTLIGHT AGAIN IN AUSTRALIA AND EUROPE

adidas has in part succeeded in infringement proceedings against PacBrands in Australia.  PacBrands used 4-striped designs on the sides of a number of styles of footwear, which adidas said infringed its own 3-stripe trade mark registrations.

On the other side of the world, in a somewhat surprising decision, OHIM’s 2nd Board of Appeal has allowed the registration of a shield “position mark” on the side of footwear.

These recent decisions relating to pure device marks in the footwear space will give hope to brand owners that use and promote these types of marks, and emphasise the enforcement advantage that obtaining registrations for such marks can provide.

4 STRIPES, YOU’RE OUT? ADIDAS V PACBRANDS IN AUSTRALIA

PacBrands, whose predecessor Pacific Dunlop had previously been a licensee of the adidas trade marks in Australia sold a number of different footwear products with a “four stripe” motif.

adidas sued for infringement of its registered 3-Stripe Trade Marks, including AU TM 924921 (shown below) which was registered under s41(5) subject to the endorsement that the mark “consists of three stripes forming a contrast to the basic colour of the shoes; the contours of the shoe serves [sic] to show how the trademark is attached and is no component of the trademark”.

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PacBrands argued that it did not use its stripes as trade marks, and so could not infringe. Robertson J considered that while PacBrands’ signs could serve as decorative and/ or functional elements, this did not mean that they could not also serve a trade mark function.  His Honour accepted the common practice of identifiers that are generally placed on the side of sports footwear, and took the view that PacBrands’ uses were trade mark uses.

On confusing similarity, adidas argued that this should be inferred from PacBrands’ conduct in developing a number of ranges of shoes with “resemblances” to adidas’ marks.  Justice Robertson rejected adidas’ argument as not being supported by the evidence.

adidas also relied on the results of an online survey.  Robertson J gave the survey little weight, holding that it did not “sufficiently replicate or correspond with the experience of a consumer in the marketplace” and that the primary question “who do you think makes this shoe” suggested an answer that the respondent might not have otherwise reached.

On the other hand, Robertson J did not accept that the fame of the adidas 3 stripe mark required a finding that those marks would not be imperfectly recollected by a consumer (cf Mars Australia Pty Ltd v Sweet Rewards Pty Ltd (2010) 81 IPR 354), instead holding that he could not assume that the average consumer would perfectly recollect the number of stripes. 

Considering the matter on a shoe-byshoe basis, Robertson J determined that only three of the shoes in play infringed adidas’ 3-Stripe Trade Marks.  It is convenient for present purposes to compare an infringing shoe against a non-infringing shoe:

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The Airborne shoe was held to infringe, taking into account that it was marked with “parallel equidistant stripes of equal width (with blue edgings) in a different or contrasting colour to the footwear, running from the lacing area to the instep area of the shoes”. Even bearing in mind that the four stripes tended to suggest otherwise, Robertson J considered that the use of this mark was likely to result in a real, tangible danger of confusion.

On the other hand, the Basement shoe had a wider gap between the two central stripes, which gave the impression of two groups of two parallel stripes.  These would not be perceived as a group of four marks, or that it contains as a subset the adidas trade marks.  There was no likelihood of confusion.

GAMP’S SHIELD MARK – A POSITIVE PRECEDENT FOR POSITION MARKS IN THE EU

Gamp Studio Srl filed CTM application no. 1107997 on 4 January 2012, for the mark below in respect of footwear in class 25.

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An examiner at OHIM raised an objection under article 7(1)(b) of the CTM Regulation, on the basis that the mark was a “banal tag” that was a mere “variation on a common feature found on footwear”.

The 2nd Board disagreed, and took into account a number of factors in finding that the mark was inherently distinctive.

In particular, it was key that such devices have become increasingly common in relation to clothing and footwear:

“the public have become accustomed to identifying a particular brand of running shoe or sports shirt based only on a distinctive pattern or design. The extensive use of advertising on television, Internet and in the printed media have, in the eyes of the relevant public, asserted the power of a design, even a relatively simple one, to be able to act as a distinguishing sign.”

Therefore, while it was considered that the mark is not high in distinctive character and not particularly original, it was “sufficiently eccentric in geometrical terms to defy being described as a ‘banal tag’”.  Further, it did not present as a piece of functional stitching or as being a necessary part of the construction of the shoe. Instead, it stood out as an independent design.

In contrast, just over a week earlier, on 20 August 2013, the 2nd Board (differently constituted) in Case R363/2013-2 Vans, Inc v OHIM held that Vans’ line logo (below) lacked any inherent distinctiveness in relation to services (including retail services relating to footwear) in class 35.

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Vans’ evidence of use (almost exclusively in relation to footwear) was insufficient to overcome the objection based on factual distinctiveness, as the mark was applied for in respect of services. Vans’ class 18 and 25 CTM for the same mark had earlier been rejected by the 5th Board in November 2012 (Case R 860.2012-5), on the basis that graphic lines and stripes are commonly used on clothing and footwear “for decorative purposes”, and that consumers would not see such signs as marks unless consumers had been “expressly educated” of that fact.  It is understood that that decision has been appealed to the General Court (Case T-53/13).

COMMENT

It is undeniable that pure device marks on footwear can and do function as brands in the minds of consumers.

The adidas decision reinforces the role and strength that registrations for such marks can play in the enforcement scenario, while also highlighting some of the limitations in terms of the scope of protection.

The Gamp decision represents a possible change in direction in terms of the registrability of such marks as CTMs, at least in relation to footwear, but possibly also clothing too.  This is good news when set against the difficult past that position marks have had with the Boards and the General Court.  For example, in Case T-547/08 X Technology Swiss GmbH v. OHIM, and Case T-388/09 Rosenruist v OHIM, respectively, the General Court (in each case upholding earlier decisions from the Board) rejected the sock and jean pocket marks below.

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The reasoning in Gamp appears to open the door to a change in practice and perception for such marks, and the decision will give hope to brand owners facing such objections at OHIM.  This may simply be a case of the Boards’ practice developing over time.