Adidas is another business Goliath who, due to insufficient or even inadequate evidence submitted, was unable to prove the use of one of its trademarks for the protection of the European Union and lost it as a result of the loss of a dispute with a smaller entity.
On 19 June 2019, by judgment given under reference no. T-307/17 The Court of First Instance (European Union) dismissed the adidas AG’s action to maintain the annulment of the right to the EU trade mark of Adidas consisting of third parallel strips placed on the product in any direction.
The company failed to demonstrate that there was a breach of the so-called ‘rights of permitted variants’ in the case and that the mark was of a distinctive character throughout the Union as a result of its use.
three parallel stripes in any direction, or what the dispute was about
On 24 May 2014 The European Union Intellectual Property Office (EUIPO) has registered for adidas AG with its registered office in Herzogenaurach, Germany (hereinafter ‘Adidas’ or ‘the Accusing’) an EU trade mark belonging to a class 25 in the Nice Classification, i.e. as a trademark for clothing, footwear and headgear.
In its application, the applicant indicated that the mark consisted of third parallel strips at equal distance from each other, of the same width, placed on the product in any direction.
A trade mark illustrated as follows:
On 16 December Shoe Branding Europe BVBA based in Oudenaarde, Belgium, applied for the cancellation of the right to the mark.
On 30 June 2016 The Cancellation Division took into account an application for annulment of the right to a mark lodged by an intervener on the ground that the trade mark in question is devoid of any distinctive character, whether inherent or obtained by reason of use.
On 18 August 2016 The applicant lodged an appeal with EUIPO against the decision of the Cancellation Division. However, Adidas did not question the absence of a distinctive character of the mark in question, but argued that the mark had acquired a distinctive character following its use in the Union.
Decision dated 7 March 2017, second The Board of Appeal of EUIPO dismissed the appeal against which Adidas’ decision brought an action before the General Court.
Adidas alleged that EUIPO had failed to take into account the evidence submitted by them, wrongly referring to the fact that they concerned markings other than the trade mark in question (below there are examples of evidence submitted by Adidas in the proceedings before EUIPO).
According to Adidas, EUIPO also misinterpreted the trademark and misapplyed the so-called ‘law of permitted variants’. Furthermore, the Adidas brand accused EUIPO of carrying out an incorrect assessment of the non-obtainance of distinctive character by a trade mark following its use in the Union.
Fig. Illustration of evidence submitted by Adidas in a trade mark dispute
Be careful what you report
The applicant for registration of a trade mark shall be required to submit a graphic trade mark corresponding to the particular protection he intends to obtain.
It is important to maintain this obligation that, as a result of the registration of a trade mark, its proprietor cannot obtain protection beyond the protection afforded by that graphic representation.
On the other hand, the applicant alleged that the EUIPO had misinterpreted the trade mark and stressed that the EUIPO should have regarded the trade mark in the present case as a ‘objective’ which could be reproduced in different dimensions and proportions depending on the goods on which it was applied. In the applicant’s view, the trade mark, as a ‘objective’, could, to some extent, deviate from the form applied for as a trade mark.
The Court of First Instance did not share the arguments raised by the applicant, indicating that the registration of the trade mark and the scope of the protection granted only takes place on the basis and within the limits of the registration application made in the EUIPO by the applicant. The Court of First Instance held that in the present case, the interpretation made by EUIPO faithfully corresponds to the graphic sign, i.e. is three parallel black stripes and two white stripes separating these stripes.
Consequently, particular attention should be paid to the presentation of the trade mark, as it may appear that the actual and intended scope of protection may deviate from the original assumptions. So you'd better watch out for what we're reporting, because we can get that kind of coverage and protection.
Right of permitted but not of any options
The law of the authorised variants is the rule that the use of a trade mark in the form of elements which do not alter the distinctive character of the trade mark is permitted. However, the different elements must not deviate from the mark in the form in which it was registered, so certain modifications to the representation of the trade mark are allowed, but only to the extent that the distinctive character of the trade mark remains unchanged.
The Court of First Instance divided the position of EUIPO according to which, due to the extreme simplicity of the trade mark in question, even a minor modification of the mark may result in a significant change in the characteristics of the trade mark in the form in which it is registered and cannot be considered equivalent to the registered mark.
The Court of First Instance stressed that the extreme simplicity of the trade mark in question makes it impossible to recognise that the scheme of colours is reversed, even with a strong contrast between three in strips and background, a minor change in relation to the registered form of the trade mark in question.
Consequently, the Court of First Instance pointed out that some of the illustrations presented by the applicant show indications including two parallel black contrast strips with white background, indicating the use of the trade mark concerned in forms where the colour scheme is reversed. As a result, they are irrelevant to the legality of the contested decision, since they represent a sign which is substantially different from the registered one.
Although the applicant has also submitted illustrations showing a trade mark outfit third However, the strips were tilted at an angle different from that of the trade mark in question in its registered form and the Court of First Instance finally ruled that the illustrations referred to indications other than the mark in question.
For the above reasons, the Court of First Instance held that the applicant wrongly referred to a breach of the ‘right of permitted options’.
Recognition in some Member States does not show a distinctive character throughout the Union
The European Union trade mark shall be uniform. This means that in order to be allowed to register, the mark must have a distinctive character or obtained by use throughout the Union.
The Court of First Instance stressed that, in order to demonstrate that the mark in question had acquired a distinctive character, only the evidence which showed the trade mark in question in its registered form or in its generally equivalent form is adequate. It is therefore excluded to use the form of a mark characterised by a reversal of the colour scheme or the absence of other legitimate features of the trade mark.
Furthermore, the evidence submitted should show a distinctive character in all Member States of the Union, and the studies submitted by the applicant have only been carried out in five Member States and covers only part of the territory of the Union. In the Court's assessment, the results of the surveys cannot be extrapolated to all Member States or supplemented and confirmed in Member States not covered by the surveys.
The Court of First Instance did not therefore share the argument put forward by the applicant that the EUIPO had wrongly carried out an assessment of the non-obtaining distinctive character of the mark as a result of its use in the Union and the applicant did not demonstrate that the trade mark had acquired a distinctive character as a result of its use throughout the Union.
David defeated Goliath again
Although the applicant may still appeal in the present case to the Court of Justice, the dispute has not been settled legally, there are a number of important points in the course of the proceedings.
Adidas is another business Goliath who, due to insufficient or even inadequate evidence submitted, was unable to prove the use of one of its trademarks to the extent protected and lost by the loss of a dispute with a smaller entity.
Similarly, McDonald’s also failed to meet similar difficulties in the case concerning the protection of the trademark of the European Union BIG MAC (as described here) by ultimately losing its protection.
Finally, it should be pointed out that special attention should be paid to registration applications, since the applicant is obliged to submit a graphic trade mark corresponding to the particular protection he intends to obtain.
This is relevant in the context of the exercise of the right of authorised options whereby the use of a trade mark in the form of elements which, however, do not alter the distinctive character of the trade mark is allowed. In the case of certain marks, such a change may be at least a reversal of the colour scheme of the mark, as in the present case.
Author:
Michał Skwarek - Council applicant in the legal department Russell Bedford Poland. Graduated from the Faculty of Law and Administration of the University of Warsaw.