A recent General Court decision on a Registered Community Design (RCD) appeal, Beifa Group Co. Ltd v OHIM, has provided welcome guidance on the interplay between Community design and trade mark law.
In May 2005, Beifa Group Co. Ltd ("Beifa") filed an application to register a Community design with OHIM representing a pen and lid and claiming priority from a Chinese application for the same design filed on 5 February 2005. Beifa's application (covering "instruments for writing") proceeded to registration and was published in July 2005.
Schwan-Stabilo Schwanhaüßer GmbH & Co. KG ("Stabilo") filed an application to invalidate Beifa's RCD in March 2006 based, inter alia, on Stabilo's earlier German (figurative) trade mark registration No. 300454708 also representing a pen and lid and also covering, inter alia, "instruments for writing" in Class 16.
On examining the case, OHIM's Cancellation Division held that the design in dispute consisted of "a sign with all the characteristic features of the three-dimensional shape of the earlier mark". The Cancellation Division concluded that, as a result of the similarity of the design to the earlier mark and the identity of the goods covered by the registrations, there existed a likelihood of confusion on the part of the relevant public and it consequently declared Beifa's RCD invalid.
In October 2006, Beifa filed an appeal with the Third Board of Appeal against the Cancellation Division's decision, but this appeal was dismissed. Following the dismissal of their appeal, Beifa filed an action before the General Court, submitting three pleas in support of its action, namely OHIM's:
a) incorrect interpretation of Article 25(1)(e) of Council Regulation No. 6/2002 on Community Designs;
b) error of law in rejecting Beifa's request for Stabilo's proof of genuine use of its earlier mark; and
c) incorrect application of Article 25(1)(e) of Regulation No. 6/2002.
With regard to the first plea, Article 25(1)(e) states that a Community design may be declared invalid only "if a distinctive sign is used in a subsequent design, and Community law or the law of the Member State governing that sign confers on the right holder of the sign the right to prohibit such use". It was Beifa's argument that Article 25(1)(e) cannot be relied upon by the holder of a distinctive sign where the sign used in a subsequent design is merely a similar sign.
The Court found that Article 25(1)(e) does not exclude subsequent designs which are not identical with the distinctive sign, stating that "Even though the Community design may lack certain features of the earlier distinctive sign or may have different, additional features, this may constitute ‘use' of that sign, particularly where the omitted or added features are of secondary importance". The Court felt that this was particularly true given that the relevant public, retaining only an imperfect memory of the marks registered in Member States or the Community, will not necessarily notice the differences between the earlier distinctive sign and the subsequent RCD.
Turning now to Beifa's second plea, the Court held that, even though Regulation No. 6/2002 does not contain any proof of use provisions, under the provisions laid down in the Markengesetz (the German trade mark law under which Stabilo's earlier mark was registered), Beifa was entitled to request proof of use. This was a hollow victory for Beifa however, as the Court went on to say that, since the Regulation does not make any express reference to the procedure for requesting proof of genuine use, it may be inferred that the request must be submitted to OHIM expressly and in due time. As a rule, the Court stated, this request must be submitted within the deadline set by the Cancellation Division for the proprietor of the RCD to submit its observations in response to an application for a declaration of invalidity. The owner of the RCD in dispute could not, however, submit such a request for the first time before the Board of Appeal, as was the case here.
Finally, Beifa argued that, even if Article 25(1)(e) applied not only to identical subsequent RCDs, but also to similar ones, the Board of Appeal had still applied this provision incorrectly because it did not undertake an assessment as to the likelihood of confusion between the RCD and the earlier mark. In particular, the Board of Appeal had made no attempt to identify the relevant public in this case, nor did it undertake an overall comparison between the earlier mark and the RCD.
In this regard, the Court made reference to the established test on the global assessment of likelihood of confusion, as laid down by the Sabel, Lloyd Schuhfabrik Meyer and Medion trade mark cases. The Court confirmed that the goods in question were identical and, being everyday goods and low-priced, would be of interest to all consumers. When considering the likelihood of confusion between the earlier mark and subsequent RCD, the Cancellation Division had considered the general public's perception of the mark and design in question, an approach which was not questioned by the Board of Appeal. In fact, since the earlier mark was registered in Germany, it was the average German consumer which should be taken into consideration.
When comparing the earlier mark with the subsequent RCD, the Cancellation Division focussed purely on the visual comparison, since neither the earlier mark nor the design in dispute contained a word element and therefore could not be the subject of a phonetic or conceptual comparison. The Cancellation Division identified four characteristic features of the shape of the earlier mark and found that these same four features were contained within the subsequent design. It also held that the addition of other features to the design in dispute did not prevent the characteristic features of the earlier mark from being discernible in the RCD. These findings were upheld by the Board of Appeal.
This is where Stabilo's case came unstuck. In its original application for invalidity of Beifa's RCD, Stabilo had relied on a number of earlier rights, among which were German trade mark registration No. 300454708 (the figurative mark) and German trade mark registration No. 2911311 (a 3D mark identical with the sign protected under registration No. 300454708). Although it acknowledged in its decision that Stabilo had relied on other signs in its invalidity application, the Cancellation Division had only referred to Stabilo's German trade mark registration No. 300454708 when discussing the similarity of the earlier mark and the design in dispute, later referring to the three-dimensional shape of the earlier mark, whereas the earlier mark was actually a figurative mark. This fatal error was repeated by the Board of Appeal. Because the Board of Appeal had based its conclusion on the likelihood of confusion between the design in dispute and the earlier mark on the comparison of that sign with a sign other than the earlier mark, the General Court found that it had erred in law and consequently annulled the contested decision.
It seems unfortunate for Stabilo that its original, long-standing and well known highlighter pen has essentially been reproduced in Beifa's design and that the registration of this design has been allowed to remain in force due to a technical error on the part of the Board of Appeal. The writer would assume that this is not a situation Stabilo is likely to take lying down. No doubt, Stabilo will seek further recourse in order to safeguard its earlier rights.
On the upside, this decision is beneficial to the trade mark profession, since it clarifies the relationship between design and trade mark law in the following ways:
1) Although the wording of Article 25(1)(e) of Regulation No. 6/2002 does not specifically mention that a RCD can be invalidated on the basis of a similar earlier distinctive sign registered in the Community or a Member State, the General Court has confirmed that this is the case. In their opinion, there must be consistency between the relevant provisions of Regulation No. 6/2002 and those of Council Directive No. 89/104/EEC to approximate the laws of the Member States relating to Trade Marks (now Directive No. 2008/95/EC) and Council Regulation (EC) Nos. 40/94 and 207/2009 on the Community Trade Mark.
2) Where the proprietor of an earlier Community or national trade mark right relies on that right to apply to invalidate a RCD, they are subject to any use requirements laid down in Community trade mark law or law of the relevant Member State. The procedure for requesting proof of use has been set out above.
Further, this decision would appear to suggest that a 3D mark is a stronger threat to a RCD for which invalidation is being sought than a figurative mark. The Court pointed out that a 3D mark is not necessarily perceived by the relevant public in the same way as a figurative mark. In the Court's opinion, in the case of a 3D mark, the relevant public perceives a tangible object, which can be examined from numerous angles, whereas in the case of a figurative mark, the public sees only an image. The Court did, however, accept that where two 3D objects are similar, a comparison of one of those objects with an image of the other, could also lead to a finding that they are similar.
No doubt this will not be the last case of its kind to give rise to the issue of the interplay between Community design and trade mark law. However, it is certainly welcome clarification for trade mark specialists and trade mark owners alike.