Monster Energy failed to prove that energy drinks with coffee can relate to two classes of the Nice classification

One interesting dispute before the General Court of the European Union has been solved recently.

The joined cases T-758/20 и T-759/20 focus our attention on an attempt by Frito Lay to revoke a European trademark ‘MONSTER’ № 009492158, owned by Monster Energy for classes 5, 29, 30, and 33, due to lack of genuine use for a period of five consecutive years.

Monster Energy’s diffensive strategy was to claim that their trademark was used for two classes 30 and 32. The reason for this was one of their products X-PRESSO MONSTER that combines coffee and energy drinks.

The General Court wasn’t impressed at all. The Court confired the general rule for classification where one finished product can be classify only in one Nice class. The only exception here could be if the product is a composite one.

Monster claimed that their product is a multi-purpose composite thing, but the Court disagreed.

A composite product can be such one that is sold as a whole but its components have separate market value and purpose.

The fact that the offered product combines coffee flavour and energy drink doesn’t mean that it is a separate cofee drink as a whole. On the contrary, by its nature this is an energy drink and the flavour cannot change this conclusion.

Consequently, as correctly pointed out by EUIPO and the intervener, coffee-based beverages and energy drinks have different natures and do not fulfil the same main function. The former are characterised by the presence of coffee, whereas the latter include and combine a number of ingredients and coffee or coffee flavouring is given only a secondary role. Consumers are aware of those differences, which are, moreover, reinforced by the applicant’s communications and promotion with regard to the ‘x-presso monster’ goods, as is illustrated by various items of evidence in the case file, including the witness statement of its director or the applicant’s annual report for the year 2020, which highlight the energy content represented by those goods.

Furthermore, as is pointed out by the intervener and as is apparent from a number of the items of evidence which the applicant provided, it is established, as regards the ‘current market conditions for energy drinks’ referred to by the Board of Appeal (see the first contested decision, paragraph 45, and the second contested decision, paragraph 30), that energy drinks flavoured with coffee are usually found on the same shelves as energy drinks with other flavours, whether they are the applicant’s or those of other manufacturers. Consumers do not perceive any difference in function or purpose between the various flavours of energy drinks, whether they are coffee flavoured, cherry flavoured, kiwi fruit flavoured, chewing-gum flavoured or mango flavoured. All of those drinks fulfil the same function, namely that of providing an energy boost.

Based on this the Court dismissed the appeal.

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Monster Energy lost a trademark dispute against a pair of legs

The well-known energy drink producer Monster Energy lost an interesting opposition against the following UK trademark application in class 32 (beers, ales, stouts; low-alcohol beers; non-alcoholic and de-alcoholized cider, perry and beers; syrups and preparations for making any of these aforesaid; excluding energy drinks):

Against this mark, Monster invoked several earlier European trademarks in class 32 (Non-alcoholic beverages; beer):

The UKIPO dismissed the opposition internally. The reason for this was the lack of possibility for consumer confusion. According to the Office, both signs are visually and conceptually different. While in the case of the earlier mark there is a pair of legs, the earlier signs represent a scratch created by an animal. Although both can be viewed as the letter M, the differences between them are enough in order to escape consumer confusion even though the goods are similar due to their nature.

The full text of the decision can be found here.

Source: WIPR.

Red Bull prevailed in a UK barbecue dispute

Red Bull won an opposition against the following UK trademark application in Class 11 – barbecue smokers and grills, pellet smokers and grills.

The opposition was based on an earlier word mark RED BULL and the following figurative mark, both in Class11:

According to the the UKIPO, there is a phonetic similarity between the sign which shares identical first part Red Bull. The presence of the words BBQ Grills in the later mark is not sufficient to differentiate them due to its lack of distinctiveness.

From a conceptual point of view, both marks are highly similar wheres from a visual side they are not because of the different graphical representations.

The earlier marks are within their 5 year period for use, so there is no need for a genuine use to be proved although Red Bull doesn’t use its trademarks for such goods.

In its conclusion, the Patent Office summarized that the signs at hand are similar to the extent that they can lead consumers to think that the goods are produced by the same or an economically linked undertaking.

Source: WIPR.

Brief IP news

1.  Why the internet age needs traditional lawyers? For more information here.

2. EU General Court rules against Red Bull colour combination mark. For more information here.

3. Protecting artworks as trade marks: Contrary to public policy and accepted principles of morality? For more information here.

Two owners – one Schweppes – A General Court decision

The General Court of EU rules in Case  C‑291/16 Schweppes SA v Red Paralela SL. This case is interesting and important especially in light of a situation where an identical mark has different proprietors. The case concerns the following:

Article 7 of Directive 2008/95, entitled ‘Exhaustion of the rights conferred by a trade mark’, provides:

‘1. The trade mark shall not entitle the proprietor to prohibit its use in relation to goods which have been put on the market in the Community under that trade mark by the proprietor or with his consent.

2. Paragraph 1 shall not apply where there exist legitimate reasons for the proprietor to oppose further commercialisation of the goods, especially where the condition of the goods is changed or impaired after they have been put on the market.’

Directive 2008/95 is repealed with effect from 15 January 2019 by Directive (EU) 2015/2436 of the European Parliament and of the Council of 16 December 2015 to approximate the laws of the Member States relating to trade marks (OJ 2015 L 336, p. 1), which entered into force on 12 January 2016 and Article 15 of which corresponds, in essence, to Article 7 of Directive 2008/95.

The dispute in the main proceedings and the questions referred for a preliminary ruling

The sign ‘Schweppes’ has a reputation worldwide for, in particular, ‘tonic water’, available in several varieties. That sign is not the object of a single registration as an EU trade mark, but has been registered for a long time as a national word and figurative mark in each of the Member States of the European Union and the European Economic Area (EEA). Those national trade marks are, in essence, identical.

Initially, all the Schweppes trade marks registered in the EEA (‘the parallel trade marks’) belonged to Cadbury Schweppes.

In 1999, Cadbury Schweppes assigned some of those parallel trade marks, including those registered in the United Kingdom, to Coca-Cola/Atlantic Industries (‘Coca-Cola’). Cadbury Schweppes remained the proprietor of the rest of the parallel trade marks, including those registered in Spain.

The shaded areas of the map below indicate the Member States of the EEA and its environs in which Coca-Cola is the proprietor of Schweppes trade marks:

Following various acquisitions and restructurings, the parallel trade marks retained by Cadbury Schweppes now belong to Schweppes International Ltd, a company operating under United Kingdom law.

The latter company has granted Schweppes an exclusive licence over the Spanish parallel trade marks at issue in the main proceedings.

Schweppes and Schweppes International are both controlled by Orangina Schweppes Holding BV, a company operating under Netherlands law, which is the ultimate parent company of the Orangina Schweppes group.

On 29 May 2014, Schweppes initiated infringement proceedings against Red Paralela in respect of the Spanish parallel trade marks, on the ground that the defendants in the main proceedings had imported and distributed in Spain bottles of tonic water bearing the trade mark Schweppes and originating in the United Kingdom. Schweppes maintains that that marketing in Spain is unlawful, given that those bottles of tonic water were manufactured and placed on the market, not by itself or with its consent, but by Coca-Cola, which, according to Schweppes, has no economic or legal connection with the Orangina Schweppes group. It submits in that context that, in view of the identical nature of the signs and goods in question, consumers are in no position to distinguish the commercial origin of those bottles.

In their defence, Red Paralela contend that the trade mark rights resulting from tacit consent, in so far as concerns the Schweppes goods originating in Member States of the European Union where Coca-Cola is the proprietor of the parallel trade marks, have been exhausted. In addition, Red Paralela consider that there are undeniable legal and economic links between Coca-Cola and Schweppes International in their joint exploitation of the sign ‘Schweppes’ as a universal trade mark.

According to the findings made by the referring court, the relevant facts for the purposes of the present proceedings are as follows:

– despite being the proprietor of the parallel trade marks in only some Member States of the EEA, Schweppes International has promoted a global image of the Schweppes trade mark;

–  Coca-Cola, which is the proprietor of the parallel trade marks registered in the other Member States of the EEA, has contributed to maintaining that global trade mark image;

– that global image is a cause of confusion for the relevant public in Spain as regards the commercial origin of ‘Schweppes’ goods;

– Schweppes International is responsible for the European website that deals specifically with the Schweppes trade mark (www.schweppes.eu), which not only provides general information about goods bearing that trade mark, but also contains links to various local websites, in particular the United Kingdom website managed by Coca-Cola;

– Schweppes International, which holds no rights in the Schweppes trade mark in the United Kingdom (where the mark is owned by Coca-Cola), refers on its website to the British origins of that mark;

– Schweppes and Schweppes International use the image of ‘Schweppes’ goods originating in the United Kingdom in their advertising;

– Schweppes International engages, in the United Kingdom, in activities promoting ‘Schweppes’ goods to customers and informing customers about those goods on social networks;

– the presentation of ‘Schweppes’ goods marketed by Schweppes International is very similar — and in some Member States, such as Denmark and the Netherlands, identical — to that of ‘Schweppes’ goods originating in the United Kingdom;

– Schweppes International, whose registered office is in the United Kingdom, and Coca-Cola coexist peacefully in the United Kingdom;

– following the assignment, which took place in 1999, of a proportion of the parallel trade marks to Coca-Cola, the two proprietors of the parallel trade marks in the EEA have, in their respective territories, applied for the registration of new, identical or similar Schweppes trade marks in respect of the same goods (such as, for example, the trade mark SCHWEPPES ZERO);

–  even though Schweppes International is the proprietor of the parallel trade marks in the Netherlands, the trade mark is exploited in that country (that is to say, the product is prepared, bottled and marketed) by Coca-Cola in its capacity as licensee;

– Schweppes International is not opposed to ‘Schweppes’ goods originating in the United Kingdom being marketed online in various Member States of the EEA in which it is the proprietor of the parallel trade marks, such as Germany and France; furthermore, ‘Schweppes’ goods are sold via websites throughout the EEA, with no distinction as to their origin;

– Coca-Cola has made no opposition, on the basis of the rights which it holds in the parallel trade marks, to Schweppes International’s application for registration of a Community design containing the word element ‘Schweppes’.

The referring court considers that the circumstances of the dispute in the main proceedings are clearly distinct from those in the cases giving rise to the case-law of the Court regarding the exhaustion of trade mark rights and that they could make further reflection necessary on the balance between the protection of those rights and the free movement of goods within the European Union.

In those circumstances, the Juzgado de lo Mercantil n° 8 de Barcelona (Commercial Court No 8, Barcelona, Spain) has decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1) Is it compatible with Article 36 TFEU and with Article 7(1) of Directive 2008/95 and Article 15(1) of Directive [2015/2436] for the proprietor of a trade mark in one or more Member States to prevent the parallel importing or marketing of goods coming from another Member State which bear a trade mark that is identical or practically identical and is owned by a third party, when that proprietor has promoted a global trade mark image that is associated with the Member State from which the goods whose import it seeks to prohibit originate?

(2) Is it compatible with Article 36 TFEU and with Article 7(1) of Directive 2008/95 and Article 15(1) of Directive 2015/2436 for goods to be sold under a trade mark, which is well known, within the European Union when the registered proprietors maintain throughout the EEA a global trade mark image which gives rise to confusion in the minds of average consumers concerning the commercial origin of the goods?

(3) Is it compatible with Article 36 TFEU and with Article 7(1) of Directive 2008/95 and Article 15(1) of Directive 2015/2436 for the proprietor of identical or similar national trade marks registered in various Member States to oppose the importation into a Member State where it owns the trade mark of goods, bearing a trade mark identical or similar to its own, coming from a Member State in which it is not the proprietor, when in at least one other Member State where it is … the proprietor of the trade mark it has expressly or tacitly consented to the importation of those same goods?

(4) Is it compatible with Article 7(1) of Directive 2008/95 and Article 15(1) of Directive 2015/2436 and with Article 36 TFEU for the proprietor A of a trade mark X registered in one Member State to oppose the importation of goods bearing that trade mark if those goods come from another Member State where a trade mark Y, identical to trade mark X, belongs to another proprietor B which markets it and:

– proprietors A and B maintain intense commercial and economic relations, although, strictly speaking, there is no dependency between them regarding the joint exploitation of trade mark X;

– proprietors A and B maintain a coordinated trade mark strategy deliberately promoting vis-à-vis the relevant public an appearance or image of a single global trade mark; or

– proprietors A and B maintain intense commercial and economic relations, although, strictly speaking, there is no dependency between them regarding the joint exploitation of the trade mark X, and in addition they maintain a coordinated trade mark strategy deliberately promoting vis-à-vis the relevant public an appearance or image of a single global trade mark?’

The Court’s decision is:

Article 7(1) of Directive 2008/95/EC of the European Parliament and of the Council of 22 October 2008 to approximate the laws of the Member States relating to trade marks, read in the light of Article 36 TFEU, must be interpreted as precluding the proprietor of a national trade mark from opposing the import of identical goods bearing the same mark originating in another Member State in which that mark, which initially belonged to that proprietor, is now owned by a third party which has acquired the rights thereto by assignment, when, following that assignment,

– the proprietor, either acting alone or maintaining its coordinated trade mark strategy with that third party, has actively and deliberately continued to promote the appearance or image of a single global trade mark, thereby generating or increasing confusion on the part of the public concerned as to the commercial origin of goods bearing that mark,

or

– there exist economic links between the proprietor and that third party, inasmuch as they coordinate their commercial policies or reach an agreement in order to exercise joint control over the use of the trade mark, so that it is possible for them to determine, directly or indirectly, the goods to which the trade mark is affixed and to control the quality of those goods.

Coca Cola won a lawsuit regarding its famous font

The General Court of the EU has ruled in case T‑61/16 Coca Cola v EUIPO which concerns an attempt by Syrian company to register the following EU trademark for drinks:

Coca Cola filed an opposition against this application based on several earlier marks among which the following:

The company claimed that the later mark tries to gain unfair advantages from the reputation of its famous trademarks imitating their font.

Initially, EUIPO dismissed the opposition considering both signs dissimilar. This decision was appealed and the Court invalidated it. In the followed re-examination the EUIPO dismissed the opposition again as groundless.

Now the General court upheld its initial position on the case concluding that the EUIPO had erred in its assessment of the evidence relating to the commercial use of the sign outside of the EU by disregarding inferences and probability analyses of the risk of free-riding within the EU.

It added that the manner in which the ‘Master’ sign is currently used is likely to lead to a “non-hypothetical” future risk of unfair advantage in the EU.

 

The Schweppes case – the EU Court Advocate General’s opinion

The Advocate General of the European Court P. MENGOZZI issued his opinion on case C‑291/16 Schweppes SA v Red Paralela SL, Red Paralela BCN SL. The case concerns the following:

The SCHWEPPES trade mark dates back to 1783, when Jacob Schweppe invented the first industrial process for the carbonisation of water, which resulted in a drink then known as ‘Schweppes’s Soda Water’, and founded the company J. Schweppe & Co. in Geneva (Switzerland). Over the years, the SCHWEPPES trade mark has acquired a worldwide reputation in the market for tonic waters.

In Europe, the sign ‘Schweppes’ is registered as a series of national trade marks, word marks and figurative marks, all of which are identical, or practically identical, in all the EEA States.

For many years, Cadbury Schweppes was the sole proprietor of those registered rights. In 1999, it sold the rights relating to the SCHWEPPES trade mark in 13 States of the EEA to The Coca-Cola Company (‘Coca-Cola’). It retained ownership of the rights in 18 other States. (3) In 2009, Cadbury Schweppes, which had since become Orangina Schweppes Group, was acquired by the Japanese group Suntory.

The SCHWEPPES trade marks registered in Spain are owned by Schweppes International Ltd, the English subsidiary of Orangina Schweppes Holding BV, which is the ultimate parent company of the Orangina group. Schweppes, the Spanish subsidiary of Orangina Schweppes Holding, holds an exclusive licence for the exploitation of the marks in Spain.

On 29 May 2014, Schweppes initiated infringement proceedings against the Red Paralela companies, concerning the importation from the United Kingdom and the sale in Spain of bottles of tonic water bearing the SCHWEPPES trade mark. According to Schweppes, the alleged actions are unlawful, in that the bottles of tonic water were put up and placed on the market not by itself or with its consent, but by Coca-Cola, which has no connection with Orangina Schweppes Group. Schweppes maintains that, in those circumstances, and given the fact that the signs and products in question are identical, consumers will be unable to identify the commercial origin of the goods.

The Red Paralela companies are defending those infringement proceedings, arguing exhaustion of the trade mark rights, in so far as concerns products bearing the SCHWEPPES trade mark originating in Member States of the European Union in which Coca-Cola is the proprietor of the mark, resulting from tacit consent. The Red Paralela companies also assert that there are undeniable legal and economic links between Coca-Cola and Schweppes International in the common exploitation of the sign ‘Schweppes’ as a universal mark. (4)

According to the findings made by the referring court, the relevant facts of the present case are as follows:

–   despite being the proprietor of the parallel marks in only some EEA States, Schweppes International has promoted a global image of the SCHWEPPES trade mark;

–  Coca-Cola, which is the proprietor of the parallel marks registered in the other EEA States, has contributed to maintaining that global trade mark image;

–  that global image is a cause of confusion for the relevant public in Spain regarding the commercial origin of goods bearing the SCHWEPPES trade mark;

–  Schweppes International is responsible for the European website that deals specifically with the SCHWEPPES trade mark (www.schweppes.eu), which not only provides general information about goods bearing that trade mark, but also contains links to various local websites, in particular the United Kingdom website that is managed by Coca-Cola;

–  Schweppes International, which holds no rights in the SCHWEPPES trade mark in the United Kingdom (where the mark is owned by Coca-Cola) refers on its website to the British origins of the mark;

–  Schweppes International and Schweppes use the image of the United Kingdom goods in their advertising;

–  in the United Kingdom, Schweppes International promotes and provides customer information concerning goods bearing the SCHWEPPES trade mark on social media;

–  the presentation of goods bearing the SCHWEPPES trade mark that are sold by Schweppes International is very similar — and in some Member States, such as the Kingdom of Denmark and the Kingdom of the Netherlands, identical — to the presentation of goods bearing the same mark that are of United Kingdom origin;

–  Schweppes International, whose registered office is in the United Kingdom, and Coca-Cola coexist peacefully in the United Kingdom;

–  following the transfer of some of the parallel marks to Coca-Cola in 1999, the two proprietors of the SCHWEPPES trade marks in the EEA have, in their respective territories, applied in parallel for the registration of new, identical or similar SCHWEPPES trade marks with respect to the same goods (such as, inter alia, the SCHWEPPES ZERO trade mark);

–  even though Schweppes International is the proprietor of the parallel marks in the Netherlands, the trade mark is exploited in that country (that is to say, the goods are prepared, bottled and sold) by Coca-Cola in its capacity as licensee;

–  Schweppes International makes no objection to the online sale of trademarked goods of United Kingdom origin in several EEA States in which it is the proprietor of the SCHWEPPES trade mark, such as Germany and France. Moreover, goods bearing that trade mark are sold throughout the territory of the EEA through web portals, with no distinction as to origin;

–  Coca-Cola has made no opposition, on the basis of its trade mark rights, to Schweppes International’s application for registration of an EU trade mark containing the verbal element ‘Schweppes’.

It was in those circumstances that the Juzgado de lo Mercantil No 8 de Barcelona (Commercial Court No 8, Barcelona, Spain) decided to stay the proceedings before it and to refer the following questions to the Court for a preliminary ruling:

‘(1) Is it compatible with Article 36 TFEU and with Article 7(1) of Directive 2008/95 and Article 15(1) of Directive (EU) 2015/2436 for the proprietor of a trade mark in one or more Member States to prevent the parallel importing or marketing of goods coming from another Member State which bear a trade mark that is identical or practically identical and is owned by a third party, when the said proprietor has promoted a global trade mark image that is associated with the Member State from which originate the goods of which it intends to prohibit the importation?

(2) Is it compatible with Article 36 TFEU and with Article 7(1) of Directive 2008/95 and Article 15(1) of Directive 2015/2436 for goods to be sold under a trade mark, which is well known, within the EU when the registered proprietors maintain throughout the EEA a global trade mark image which gives rise to confusion in the minds of average consumers concerning the commercial origin of the goods?

(3) Is it compatible with Article 36 TFEU and with Article 7(1) of Directive 2008/95 and Article 15(1) of Directive 2015/2436 for the proprietor of national trade marks which are identical or similar in various Member States to oppose the importation into a Member State where it owns the trade mark of goods, identified by a trade mark identical or similar to its own, coming from a Member State in which it is not the proprietor, when at least in another Member State where it is not the proprietor of the trade mark it has expressly or tacitly consented to the importation of those same goods?

(4) Is it compatible with Article 7(1) of Directive 2008/95 and Article 15(1) of Directive 2015/2436 and with Article 36 TFEU for the proprietor A of a trade mark X of a Member State to oppose the importation of goods identified by the said trade mark if those goods come from another Member State where a trade mark identical to X (Y) is recorded as registered by another proprietor B which markets the same and:

–  proprietors A and B maintain intense commercial and economic relations, although there is no strict dependency between them regarding the joint exploitation of trade mark X;

–  proprietors A and B maintain a coordinated trade mark strategy deliberately promoting vis-à-vis the relevant public an appearance or image of a single and global trade mark; or

–   proprietors A and B maintain intense commercial and economic relations, although there is no strict dependency between them regarding the joint exploitation of the trade mark X, and in addition they maintain a coordinated trade mark strategy deliberately promoting vis-à-vis the relevant public an appearance or image of a single and global trade mark?’

The Advocate General’s opinion:

Article 36 TFEU and Article 7(1) of Directive 2008/95/EC of the European Parliament and of the Council of 22 October 2008 to approximate the laws of the Member States relating to trade marks preclude the licensee of the proprietor of a national trade mark from invoking the exclusive rights enjoyed by the latter under the law of the Member State in which the trade mark is registered in order to oppose the importing into and/or marketing in that State of goods bearing an identical trade mark which come from another Member State, one in which that trade mark, which was once owned by the group to which both the proprietor of the mark in the importing State and its licensee belong, is owned by a third party which has acquired the rights to it by assignment where, given the economic links existing between the proprietor of the mark in the importing State and the proprietor of the mark in the exporting State, it is clear that the marks are under unitary control and that the proprietor of the mark in the importing State has the possibility of determining directly or indirectly the goods to which the trade mark in the exporting State may be affixed and of controlling their quality.