Guidelines Concerning Proceedings before the Office for Harmonization in the Internal Market (Trade Marks and Designs)

Transcription

1 Guidelines Concerning Proceedings before the Office for Harmonization in the Internal Market (Trade Marks and Designs) Part D, Section 2: Cancellation proceedings, substantive provisions Draft, DIPP Status: October 2006

2 1. The grounds for cancellation Article 55(1) The term cancellation proceedings refers comprises applications for revocation and for declarations of invalidity. Article 50 The grounds for revocation are: Non-use That the mark has become the common name in trade for the goods and services for which it is registered That the mark has become deceptive If the proprietor no longer satisfies the requirements for being proprietor of a CTM. Declarations of invalidity may be based on absolute grounds or relative grounds. Article 51 The absolute grounds for invalidity are: Registration in breach of Article 7 The CTM application was filed in bad faith Article 52 The relative grounds for invalidity are: The same grounds as for an opposition under Article 8 A right to a name or personal portrayal A copyright An industrial property right Any other right with similar protection. 2. The consequences of cancellation Article 54 In the event of revocation and to the extent it is revoked the CTM will be deemed not to have the effects specified in the CTMR as from the date of application for revocation. An earlier date on which one of the grounds for revocation occurred may be fixed by the Cancellation division if this is requested by one of the parties. In the event of a declaration of invalidity the CTM, to the extent it is declared invalid, will be deemed not to have had effect from the outset. 3. Assessment of conditions for revocation Article 50(1)(a) 3.1. Non-use 2

3 If within a continuous period of five years after the CTM has been registered and before the filing of the request for cancellation the CTM has not been put to genuine use it must be revoked unless there are proper reasons for nonuse (3.1.6). If there is use for only part of the goods and services for which it is registered, the revocation will be limited to the non-used part Onus of proof The onus of proof rests on the proprietor of the CTM. Once an application for revocation has been properly filed from a formal point of view the burden of providing the evidence of genuine use rests on the proprietor. The role of the Office is to assess the evidence put before it in the light of the submissions of the parties. It has no role in collecting evidence itself Genuine use The means of assessing genuine use are the same in cancellation proceedings as in opposition assessment of proof of use of CTMs. The detailed considerations in Part 6 of the opposition guidelines should be followed. A number of the more important aspects are repeated below. Neither the CTMR nor the CTMIR defines what is to be regarded as genuine use. The Court of Justice, in the context of Article 10(3) of the Directive, has in the meantime however laid down several important principles as regards the interpretation of this term. Ansul 2003 In the Ansul case of 11 March 2003, C-40/01, the ECJ established the following principles: Genuine use means actual use of the mark (nr. 35); Genuine use must therefore be understood to denote use that is not merely token, serving solely to preserve the rights conferred by the mark (nr. 36); Genuine use must be consistent with the essential function of a trade mark, which is to guarantee the identity of the origin of goods or services to the consumer or end user by enabling him, without any possibility of confusion, to distinguish the product or service from others which have another origin (nr. 36); Genuine use entails use of the mark on the market for the goods or services protected by that mark and not just internal use by the undertaking concerned (nr. 37); Genuine use must relate to goods or services already marketed or about to be marketed and for which preparations by the undertaking to secure customers are under way, particularly in the form of advertising campaigns (nr. 37); 3

4 When assessing whether there has been genuine use, regard must be had to all the facts and circumstances relevant to establishing whether the commercial exploitation of the mark is real, in particular whether such use is viewed as warranted in the economic sector concerned to maintain or create a share in the market for the goods or services protected by the mark (nr. 38); The circumstances of the case may thus include giving consideration, inter alia, to the nature of the goods or service at issue, the characteristics of the market concerned and the scale and frequency of use of the mark (nr. 39); Use need not, therefore, always be quantitatively significant for it to be deemed genuine, as that depends on the characteristics of the goods or service concerned on the corresponding market (nr. 39). La Mer 2004 In the La Mer case, of 27 January 2004, C-259/02, the Court of Justice further elaborated the Ansul criteria as follows: The question whether use is sufficient to preserve or create market share for those products or services depends on several factors and on a case-by-case assessment. The characteristics of those products and services, the frequency or regularity of the use of the mark, whether the mark is used for the purpose of marketing all the identical products or services of the proprietor or merely some of them, or evidence which the proprietor is able to provide, are among the factors which may be taken into account (nr. 22); Use of the mark by a single client which imports the products for which the mark is registered can be sufficient to demonstrate that such use is genuine, if it appears that the import operation has a genuine commercial justification for the proprietor of the mark (nr. 24); A de minimis rule cannot be laid down (nr. 25) Geographical extent of use Genuine use may be found also when the mark has been used in only one part of the Community, such as in a single Member State or in a part thereof. Any other rule would discriminate between small and big enterprises, and thus be contrary to the aim pursued by the CTM system which should be open to businesses of all kinds and sizes. The sufficiency of use in only a part of the Community is reflected in the Joint Statements by the Council and the Commission entered in the minutes of the Council meeting at which the CTMR was adopted (Joint Statements by the Council and the Commission of , No B. 10 to 15, OJ OHIM 1996, 615). According to these statements, The Council and the Commission 4

5 consider that use which is genuine within the meaning of Article 15 in one country constitutes genuine use in the Community. While these statements only have an interpretative value and are not legally binding, they have been applied by Office. It must, however, be underlined that it is the European requirements or standards which must be complied with and not he national standards. It may be that European quantity standards could be higher than the respective national criteria in some cases Period to be taken into account Firstly, the application for revocation must be dismissed if the CTM has not been registered for five years at the time of the application for revocation. In principle the five year period counts backwards from the date of the application for revocation. Subject to the exception below, if the proprietor of the CTM proves that the non-use is for any period less than five years the application for revocation will be rejected Exception to the five year rule Use that commences or resumes within the three month period before the filing of the application for revocation will be disregarded if the preparations for use occur only after the proprietor of the CTM becomes aware that an application for revocation may be filed. The onus for proving that the proprietor was so aware rests on the applicant for revocation Proper reasons for non-use Business risks The concept of proper reasons must be considered to refer essentially to circumstances unconnected with the trade mark owner which prohibits him from using the mark, rather than to circumstances associated with the commercial difficulties he is experiencing. Court of First Instance, T-156/01, GIORGI / GIORGIO AIRE, paragraph 41 Thus, financial difficulties encountered by a company as a result of an economic recession or due to its own financial problems, such as insolvency proceedings, bankruptcy or temporary stoppage of activities are not considered to constitute proper reasons for non-use within the meaning of Article 50(1)(a). These kinds of difficulties constitute a natural part of running a business. 120/2001 Ecros(fig) / ERCROS (EN) Government intervention 5

6 Import restrictions or other government requirements are two examples of proper reasons for non-use that are explicitly mentioned in the second sentence of Article 19(1) of the TRIPS agreement. Import restrictions include a trade embargo affecting the goods protected by the mark. Other government requirements can be a State monopoly, which impedes any kind of use, or a State prohibition of the sale of goods for reasons of health or national defence. Typical cases in this respect are regulatory procedures, which the owner has to pass before offering the relevant goods and services on the market. 1507/2001 DIADUR / VIADUR (EN) (for pharmaceuticals) Force majeure Further justifiable reasons for non-use are cases of force majeure which hinder the normal functioning of the owner s enterprise. Article 50(1)(b) 3.2 CTM becoming a generic term If in consequence of acts or inactivity of the proprietor the trade mark has become the common name in trade for a product or service for which the CTM was registered Onus of proof The onus of proof rests on the applicant for revocation who must establish that the term has become the common name in the trade as a result of either: Acts by the proprietor, or Inactivity by the proprietor. The Cancellation Division will not carry out its own research on the issue. It will confine itself to an analysis of the facts and arguments presented by the parties Common name The mark must have become the common name for the good or service not just among some people, but among the large majority of the relevant public including those involved in the trade in the good or service in question. It is not sufficient for the mark to be used as a synonym or shorthand for a particular good or service while the relevant public also recognise the term as a mark designating the goods or services of a particular enterprise. For example, when someone is doing research on the internet they may say that they will google but this shorthand use does not make GOOGLE (CTM ) a generic term. It continues to be a term designating goods and services from a particular enterprise. 6

7 3.2.3 Acts by the proprietor If the proprietor uses the mark as a descriptive term and that action results in the term becoming the common name in trade for the goods or services in question then the CTM will be liable to cancellation Inactivity by the proprietor If the mark becomes the common name in trade in spite of activity by the proprietor it may not be revoked. Activity by the proprietor would include advertising; placing warnings on labels; having recourse to Article 10 CTMR (reproduction in dictionaries), but this list is not exhaustive. Article 51(c) 3.3 CTM becoming misleading If, in consequence of use made of the mark by the proprietor or with his consent the mark is liable to mislead the public particularly concerning the nature, quality or geographical origin of the goods or services for which it is registered, the CTM is liable to revocation Onus of proof The onus for proving that the mark has become misleading rests on the applicant for revocation. He must further prove that it is the use made by the proprietor that produces the misleading effect. If the use is by a party other than the proprietor the onus is on the applicant for revocation to prove that the proprietor has consented to that use. The Cancellation Division will not carry out its own research on the issue. It will confine itself to an analysis of the facts and arguments presented by the parties Examples The distinctive figurative CTM contains the words Goats cheese and is registered for goats cheese. Use of the CTM is made for both goats and sheep s cheese. The CTM is liable to be revoked. The distinctive figurative CTM contains the words pure new wool and is registered for clothing. Use of the CTM is made for clothing manufactured from artificial fibres and this makes the CTM liable to revocation. A CTM consists of the words O Reilly s Fine Irish Whiskey and is registered for Irish whiskey. Use of the CTM is made for Scotch whisky, making the CTM liable to revocation. 7

8 Article 51(d) 3.4 The proprietor loses entitlement to be proprietor of a CTM The condition to be the proprietor of a CTM laid down in Article 5 are now easy to satisfy. Any natural or legal person, including authorities established under public law, may be the proprietor of a Community trade mark. It is unlikely that having fulfilled this condition prior to registration the circumstances would change after registration. 4. Absolute grounds for invalidity Article 51(1)(a) 4.1 CTM registered contrary to Article 7 If the CTM at the time of registration was objectionable under any of the grounds listed in Article 7 it is liable to be cancelled, subject to the exception mentioned in 4.2 below. For example is the Lego Brick case where CTM was registered in breach of Article 7(1)(e)(ii). In this case the Office, in accepting the mark for registration applied a standard which the European Court of Justice, in a separate case, decided was incorrect. A further example is where the Office decided on registration of a term not being aware of its descriptive nature at the time. Court of First Instance, T-237/01 (CTM BSS No ) The Cancellation Division will not carry out its own research on the issue. It will confine itself to an analysis of the facts and arguments presented by the parties Points in time to be considered With the exception of the circumstances described in 4.2, the points in time in respect of which the assessment must be made is that both of the filing date and of the registration of the CTM. If the circumstances at the filing date of the CTM were such as to have properly given rise to an objection under Article 7 and this was not done then the mark is liable to be declared invalid. Furthermore events occurring between the time of acceptance for publication and the subsequent registration may be taken into account. The mark might for example, between the filing date and registration, become the common term in trade for the goods or services in respect of which registration was granted Standards to be applied The Examination Guidelines contain details of the criteria to be applied in assessing whether a CTM application complies with Article 7. The criteria are identical in invalidity proceedings. 8

9 Article 51(2) 4.2 Defence against a claim of lack of distinctiveness Acquired distinctiveness Where the CTM has been registered in breach of Article 7(1)(b), (c) or (d) but as a result of the use made of it has acquired distinctive character after registration it may not be declared invalid Onus, standard to be applied and point in time to be considered It is exclusively for the proprietor of the CTM to make the claim to acquired distinctiveness and to produce the evidence in support of the claim. The assessment should be carried out in accordance with the relevant part of the Examination Guidelines. The point in time to be considered is the situation when the evidence is complete. Article 51(1)(b) 4.3 Bad Faith Where the applicant was acting in bad faith when he filed the application for the CTM it is liable to be declared invalid Point of time to be considered The situation has to be examined by reference to the circumstances at the filing date. Subsequent events may shed light on the position at the filing date but the essential point in time to be considered is the filing date itself Principle of bad faith Neither the Regulation nor Implementing Regulation offer a definition of bad faith. The Office has stated that bad faith can be considered to mean dishonesty which would fall short of the standards of acceptable commercial behaviour but this is not a comprehensive definition. Other behaviour may be considered to demonstrate bad faith. Conceptually, bad faith can be understood as dishonest intention. Decision of the Cancellation Division of 10 October 2004 (CTM ER No ) The examples below in and are not exhaustive Examples of bad faith There is bad faith when the CTM applicant intends through registration to lay claim on a trade mark of a third party with which it had contractual or precontractual relations. 9

10 Decision of the Cancellation Division of xxx (CTM Noxxx) There is a likelihood of bad faith where a trade mark that has already been cancelled on the grounds of bad faith in a Member State is applied for as a CTM. Where the proprietor of a CTM makes repeated applications for the same mark with the effect of avoiding the consequences of revocation for non-use of earlier CTMs, whether in whole or in part, the proprietor is acting in bad faith Examples where there is no bad faith An application for a CTM where the same trade mark had been rejected by the central industrial property office of a Member State on grounds of descriptiveness does not constitute bad faith. Decision of the Cancellation Division of 23 November 2004 (CTM AALBORG No ) There is no requirement in the CTM system for an applicant to have an intention to use the mark when applying. Thus absence of intent to use is not a ground for establishing bad faith. Similarly, applying for protection across a broad range of goods and services does not constitute bad faith. Decision of the Cancellation Division of 14 December 2004 (CTM NAKED No ) Where, in the course of the application procedure the applicant pursues claims, such as priority or seniority, which are later rejected does not constitute bad faith. Decision of the Cancellation Division of 27 September 2004 (CTM XENIVM No ) 5. Relative grounds for invalidity Article 52(1) 5.1 The same grounds as for an opposition under Article 8 The substantive conditions for considering an earlier right referred to in Article 8 as a relative ground for a declaration of invalidity are the same as in opposition proceedings. The Opposition Guidelines should be applied accordingly. 5.2 Defences against an application under Article 52(1) 10

11 Article 52(3) Consent to registration The CTM may not be declared invalid if the owner of the earlier right consents expressly to the registration of the CTM before filing the application for a declaration of invalidity. The consent does not have to be given before the date of registration of the CTM. It is sufficient if it is before the filing of the application for invalidity. For these purposes the Office will take into account a contract to this effect between the parties. Article 52(4) Earlier applications for declaration of invalidity or counterclaims Where the proprietor of an earlier right has previously made an application for a declaration of invalidity of a CTM or has made a counterclaim for invalidity in infringement proceedings on the basis of rights in Article 52(1) or (2) before a Community trade mark court he may not submit a new application for a declaration of invalidity on the basis of other rights referred to in Article 52(1) or (2) which he could have invoked in the original proceedings. Although Article 96 imposes an obligation on Community trade mark courts to notify the Office of the initiation of counterclaims for invalidity and their outcome, in practice this is not always done. The proprietor of the CTM who wishes to rely on the defence provided for by Article 54(2) must produce evidence from the national court to support his claim. Article Acquiescence Where the proprietor of an earlier CTM or national trade mark has acquiesced for a period of five successive years in the use of the CTM, while being aware of the use, the CTM is not liable to be declared invalid. The onus is on the proprietor to show that: The CTM has been in use in the Community during a period of at least five successive years The proprietor of the earlier mark knows of this and Has taken no action to prevent the use. All three conditions must be fulfilled. Article 56(2) and (3) Non-use of the earlier mark Where the earlier mark has been registered for five years or more when the application for a declaration of invalidity is filed, the proprietor of the CTM may request that the proprietor furnish proof that the earlier mark has been put to genuine use or that proper reasons for non-use exist. The assessment of whether there is genuine use or proper reasons for non-use should be carried out in accordance with part 6 of the Opposition Guidelines, the principal features of which are repeated at above. 11

12 The relevant time for assessing when the mark must have been used is different from opposition proceedings. In all cases where the earlier mark was registered for five years prior to the filing of the application for a declaration of invalidity the proof of genuine use must relate to that period. Furthermore, where the earlier mark was registered for at least five years before the publication of the application for the CTM that is the object of the application for a declaration of cancellation, proof of use during that period must be produced. Article 52(2) 5.3 Other earlier rights A CTM is liable to be declared invalid on the basis of the rights below where the use of the trade mark could be prohibited under the Community or national law governing their protection. In order to succeed under any of the headings below the applicant for a declaration of invalidity will have to establish that each of the following conditions is fulfilled: Article 52(2)(a) A right to a name or personal portrayal Not all Member States protect the right to a person s name or portrayal. The Office has no compilation in this respect equivalent to that under Article 8(4). The relevant law will have to be proven in each case. Article 52(2)(b) A copyright Copyright is protected in each Member State and despite harmonization of copyright law within the Community there may be differences of conditions for protection and the precise scope of that protection. The relevant law will have to be proven in each case. Article 52(2)(c) An industrial property right Other industrial property rights, at national or Community level such as the Registered Community design (RCD) may be invoked. The relevant national law will have to be proven in each case. In the case of the RCD there is no need to prove what protection is given under the law. Article 52(3) 5.4 Defence against an application under Article 52(2) The CTM may not be declared invalid if the owner of the earlier right consents expressly to the registration of the CTM before filing the application for a declaration of invalidity. The consent does not have to be given before the date of registration of the CTM. It is sufficient if it is before the filing of the 12

13 application for invalidity. For these purposes the Office will take into account a contract to this effect between the parties. Article 52(4) 5.5 Earlier applications for declaration of invalidity or counterclaims Where the proprietor of an earlier right has previously made an application for a declaration of invalidity of a CTM or has made a counterclaim for invalidity in infringement proceedings on the basis of rights in Article 52(1) or (2) before a Community trade mark court he may not submit a new application for a declaration of invalidity on the basis of other rights referred to in Article 52(1) or (2) which he could have invoked in the original proceedings. Although Article 96 imposes an obligation on Community trade mark courts to notify the Office of the initiation of counterclaims for invalidity and their outcome, in practice this is not always done. The proprietor of the CTM who wishes to rely on the defence provided for by Article 54(2) must produce evidence from the national court to support his claim. 6. General defence against applications for revocation or for declarations of invalidity Article 55(3) 6.1 Same action previously In addition to the particular defences mentioned in paragraphs 4.2, 5.2, 5.4 and 5.5 an application for revocation or for a declaration of invalidity shall be in admissible if an application relating to the subject matter and cause of action, involving the same parties has been considered by a court in a Member State and has become final. The same applies to application previously decided by the Office. 6.2 Exception for opposition decisions On the other hand, a prior decision by the Office in opposition proceedings does not preclude a later cancellation request based on the same earlier rights. However, a different decision in invalidity proceedings should only arise where on or more of the following conditions is fulfilled: New facts are proven (e.g. proof of use or reputation of the earlier mark which was not made available during opposition proceedings) The manner in which key legal assessments are made (e.g. the standards for assessing likelihood of confusion) has changed, for example as a result of intervening decisions of the European Court of Justice. 13