Two recent decisions by the community courts suggest that there is more to trademark registration than meets the eye…

In trademark law, the analysis of files, particularly for registrations and oppositions, has always been based on the trademarks “as they were registered”. This means that any context that did not come into play during the registration of the trademark, whether it has to do with the sign, the sign’s possible description or products and/or services claimed, is disregarded.

It can however be frustrating when certain contexts are not taking into account, especially when it comes to proving that a Defendant’s acted in bad faith by using elements that are unrelated to the registered trademark.

The community courts have given their rulings on two very recent cases:

  • The General Court ruling on 27 June in the case of Yakult v Malaysia Dairy (C-320/12)
  • The Court of Justice of the European Union ruling on 18 July in the case of Specsavers v Asda (C-352/12)

In both cases, the courts had in fact taken account of these famous contexts which could be favourable to the Plaintiff.

  1. The "Specsavers" ruling

A brief overview of the facts:

  • Specsavers, a chain of opticians, uses the following trademark: (click here to view image)
  • It is registered as a community trademark in the following form: (click here to view image)
  • Asda used the following logos to promote its own chain of opticians in its supermarkets:  (click here to view images)

Asda also used the slogans: "Be a real Spec saver at Asda” and “Spec savings at Asda”.

Specsavers brought a counterfeit case against Asda, who argued that the following trademark had not been used: (click here to view image)

In the British court of first instance, the Specsavers trademark in black and white was cancelled due to a lack of use. Specsavers then appealed the decision and the Court of Appeal referred the following two questions to the Court of Justice of the European Union:

  • Does the combined use of the double oval together with the word Specsavers (being the subject of the trademark registration) constitute use of the logo in black and white?
  • Is the use of the green colour both by Specsavers and Asda a factor that must (or can) be taken in account even though this green colour does not appear on Specsavers’ registered trademarks?

The CJEU answered with the classic response, following the cases of Nestlé v Mars (case C-353/03, 2005) and Colloseum v Levi Strauss (case C-12/12, 2012), that use of the whole trademark includes use of the black and white logo if the differences between the two do not change the distinctive character, in other words, if it serves the function of indicating origin to the public. While the first question does not warrant much elaboration, the second question is certainly much more interesting and innovative!

The CJEU answered the second question by indicating that when a trademark is registered in black and white but used in colour, the colour must be taken into consideration if it is likely to affect the average consumer’s perception of the mark.

In the present case, it is certain that the use of the colour green in the broader context of Asda’s advertising campaign was clearly aimed at creating an association between the two trademarks in the mind of the average consumer.

2. The Yakult ruling

A brief overview of the facts:

  • Yakult owns the rights in a great number of countries for industrial designs and trademarks on a plastic bottle design for a milk-based drink dating back to 1965 in Japan.
  • Malaysia Dairy has been producing and selling a milk-based drink since 1977 in Malaysia in a bottle similar to that of Yakult.
  • In 1993, Yakult and Malaysia Dairy signed a coexistence agreement on their bottle designs.
  • In 1995, Malaysia Dairy applied for (and successfully registered) the shape of its bottle as a 3-D mark in Denmark.
  • In 2000, Yakult brought an action for invalidity against the registration on the grounds that Malaysia Dairy knew or should have known of the existence of Yakult’s prior rights because of the previously signed agreement.
  • In 2005, the Danish trademark office rejected Yakult’s case on the grounds that merely having knowledge of prior rights was not sufficient to establish a case of fraud.
  • In 2006, the Appeal Chamber agreed with Yakult, and the decision was confirmed in 2009 by the Commercial Court. Malaysia Dairy then appealed to the Danish Supreme Court which referred the following questions to the CJEU:
    • Is bad faith a concept within European Union law which must be given uniform interpretation across Member States?
    • If bad faith is a concept of European Union law, is the mere knowledge, actual or presumed, of a prior mark sufficient to establish bad faith?
    • Is a Member State allowed to introduce specific protection for foreign trademarks based on the issue of bad faith?

It came as no surprise that the CJEU responded “yes” to the first question (that bad faith was a concept within European Union law) and “no” to the third question (that a Member State was not permitted to introduce a specific system of protection).

What is much more interesting is the Court’s response to the second question:

Article 4(4)(g) of Directive 2008/95 must be interpreted as meaning that, in order to permit the conclusion that the person making the application for registration of a trade mark is acting in bad faith within the meaning of that provision, it is necessary to take into consideration all the relevant factors specific to the particular case which pertained at the time of filing the application for registration. The fact that the person making that application knows or should know that a third party is using a mark abroad at the time of filing his application which is liable to be confused with the mark whose registration has been applied for is not sufficient, in itself, to permit the conclusion that the person making that application is acting in bad faith within the meaning of that provision.

It is clear that all the factors related to the application for registration must be taken into account. 

Key points

We already know that the community authorities are giving more and more consideration to the competition environment when analysing trademark registration applications or when there is a conflict between two trademarks.

We now have a situation where the facts that did not come into play at the time of registration are being taken into account by the courts and can affect the final decision. These include the use of a colour, the applicant’s behaviour, his/her knowledge of such-and-such facts, or the existence of such-and-such agreements.

In my view, this is an excellent development in trademark law, since it leads to fairer decisions by taking the widest possible context into account.

The following two consequences are nevertheless, to be noted:

  • Applications will become more complex to prepare and to manage (with possible financial implications)
  • It will become imperative, when initiating court action, to keep an eye out for additional contexts that could cause the tables to be turned.