Apple lost a trademark dispute for MAC in Japan

One interesting trademark dispute from Japan shows us how difficult sometimes is famous trademarks to be invoked in opposition procedures.

The case concerns a trademark MACLOGIC filed by a local company in Japan for classes 9 and 42 – mainly computer software and design.

Against this mark, an opposition was filed by Apple Inc based on an earlier mark from MAC accompanied by a claim of trademark reputation. According to Apple, the mark applied for was similar to the earlier one due to the identical first part MAC, which was famous amongst Japanese consumers in relation to the company’s laptops and software. This was able to create consumer confusion in regard to the source of trade origin of the goods and services.

The Japan Patent Office, however, didn’t find both marks similar enough from a phonetic, visual, and conceptual point of view.

What’s a more, the Office considered the earlier mark reputation as established only for some consumers in the country but not for the public in general. Because of this, the opposition was dismissed.

The interesting moment in this decision was the fact that the reputation of a mark amongst the relevant consumers was not enough in order for this claim to be well established for the proceeding.

Source: Masaki MIKAMI, Marks IP Law Firm.

Is there bad faith in the case of new registration of former trademarks?

Is it possible for an old former trademark that is not protected anymore to be registered by a new owner and whether this can be a bad faith practice? This is the question to which the General Court of the European Union has answered recently in the case T‑250/21 Ladislav Zdút v EUIPO: The case has the following background:

On 6 May 2013,  Ladislav Zdút filed an application for registration of an EU trademark with EUIPO for the following sign:

The goods for which registration was sought were:

–  Class 18: ‘Leather and imitations of leather, and goods made of these materials and not included in other classes; Animal skins, hides; Trunks and travelling bags; Umbrellas and parasols; Walking sticks’;

–  Class 24: ‘Bed covers; Table covers’;

–  Class 25: ‘Clothing, footwear, headgear’.

The mark was registered on 31 October 2014 under number 11794112.

On 17 June 2019, the interveners, Ms Isabel Nehera, Mr Jean-Henri Nehera and Ms Natacha Sehnal, filed an application for a declaration of invalidity against that mark (‘the contested mark’), in accordance with the provisions of Article 59(1)(b) of Regulation 2017/1001, in respect of all the goods covered by that mark. They claimed that the applicant was acting in bad faith when he filed the application for registration of the contested mark. They stated, inter alia, that in Czechoslovakia in the 1930s, their grandfather, Mr Jan Nehera, had established a business marketing clothing and accessories and had filed and used a national mark identical to the contested mark (‘the former Czechoslovak trademark’).

By decision of 22 April 2020, the Cancellation Division of EUIPO dismissed the application for a declaration of invalidity, on the ground that the applicant’s bad faith when he filed the contested mark had not been established.

On 15 June 2020, the applicants filed a notice of appeal with EUIPO, pursuant to Articles 66 to 71 of Regulation 2017/1001, against the decision of the Cancellation Division.

By the contested decision, the Second Board of Appeal of EUIPO upheld the interveners’ appeal, annulled the decision of the Cancellation Division, and declared the contested mark invalid.

In essence, the Board of Appeal found that the former Czechoslovak trademark was a well-known mark and had been put to genuine use in Czechoslovakia in the 1930s. It held that the applicant was aware of the existence and celebrity both of Mr Jan Nehera and of the former Czechoslovak trademark, which retained a certain surviving reputation. The Board of Appeal also stated that the applicant had attempted to create an association between himself and that former Czechoslovak trademark. In those circumstances, the Board of Appeal considered that the applicant’s intention was to take unfair advantage of the reputation of Mr Jan Nehera and of the former Czechoslovak trademark. It found that the applicant was acting in bad faith when he filed the application for registration of the contested mark.

The decision was appealed.

According to the Court, the fact that one mark was been protected in the past, being reputable amongst consumers, does not mean automatically that every new application for the same mark will be deemed as made in bad faith. It is necessary for the reputation of the old mark still to exist and the bad faith actions to be proved.

According to the Court:

However, it should be borne in mind that, according to the case-law, the existence on the part of the relevant public of a link between a later trademark and a former sign or name cannot be sufficient, on its own, to support a finding that unfair advantage was taken of the reputation of the sign or of the former name.

In addition, it should be noted that the concept of unfair advantage being taken of the reputation of a sign or a name covers a situation in which a third party rides on the coat-tails of a formerly renowned sign or name in order to benefit from its power of attraction, its reputation and its prestige and, without any financial compensation and without having to make any efforts of its own in that regard, to exploit the commercial effort expended by the proprietor or user of that sign or of that name in order to create and maintain the image of that sign or of that name.

However, in the present case, the applicant claims, unchallenged either by EUIPO or by the interveners, that in 2013, the former Czechoslovak trademark and the name of Mr Jan Nehera were completely forgotten by the relevant public, and that he himself devoted considerable effort, time and money to revive the Nehera mark and to make known the history of Mr Jan Nehera and of his business. It follows that, far from merely having exploited in a parasitic way the past reputation of the former Czechoslovak trademark and the name of Mr Jan Nehera, the applicant made his own commercial efforts in order to revive the image of the former Czechoslovak trademark and thus, at his own expense, to restore that reputation. In those circumstances, the mere fact of having referred, for the purposes of promoting the contested mark, to the historic image of Mr Jan Nehera and of the former Czechoslovak trademark does not appear to be contrary to honest practices in industrial or commercial matters.

Secondly, and in any event, the former Czechoslovak trademark and Mr Jan Nehera’s name no longer benefited from any legal protection in favour of a third party at the date on which the application for registration of the contested mark was filed (see paragraphs 42 and 43 above). It follows that Mr Jan Nehera’s descendants and heirs did not hold any right that might be susceptible to fraud or to being usurped by the applicant. Therefore it does not appear that, in applying for registration of the contested mark, the applicant intended to defraud the descendants and heirs of Mr Jan Nehera or to usurp their alleged rights.

In the fifth and last place, EUIPO claims, as the Board of Appeal stated in paragraph 36 of the contested decision, that the concept of bad faith does not necessarily imply any degree of moral turpitude.

In that regard, it is sufficient to note that, according to the case-law cited in paragraph 23 above, the concept of bad faith presupposes the presence of a dishonest state of mind or intention. In the present case, EUIPO and the interveners have not established that the applicant was driven by a dishonest state of mind or intention when he filed the application for registration of the contested mark.

It follows from all of the foregoing that the Board of Appeal erred in finding that the applicant intended to take unfair advantage of the reputation of Mr Jan Nehera and of the former Czechoslovak trademark and in finding that he was acting in bad faith when filing the application for registration of the contested mark.

Facebook faces a trademark lawsuit for its META rebranding

As it is well-known, Facebook rebranded itself as a company to META in 2021. The main goal was for this name to fit better with the future development of the company, and in particular with the emergence of the metaverse as a new virtual world.

Facebook filed a trademark for META, and this blog has already discussed the probabilities of potential legal conflicts taking into consideration numerous early registered trademarks for META around the world including in the US.

So it is of no surprise that a trademark infringement lawsuit has been filed in New York against Facebook by a company named METAx LLC.

This company claimed the use of the META brand since 2010 in relation to VR and augmented reality technologies. What’s more, the company owns two earlier US trademarks:

No. 5,194,332, registered in class 35: Organizing and holding special events for commercial, promotional or advertising purposes; Event planning and management for the marketing, branding, promotion or advertising of the goods and services of third parties; Social media strategy and marketing consulting focused on helping clients create and expand their product and brand strategies by building virally engaging marketing solutions; Special event planning for business purposes; Arranging, organizing and conducting live interactive marketing promotional events for business promotional purposes, and

No. 6,055,841, registered in class 41: Media production services, namely, video and film production; Entertainment, namely, production of community sporting and cultural events using digital, virtual and augmented reality filmmaking and interactive displays of lights, sound and motion; Special event planning for social entertainment purposes.

According to METAx, Facebook has been aware of its business and trademarks since 2017 when there was communication between both companies.

To what extent this lawsuit can be successful depends on the particular facts. What is for sure is that Facebook can face more similar conflicts in the future taking into account the bunch of early registered Meta trademarks for similar goods and services. One possible defensive strategy for Facebook could be to claim a low-distinctive character of the word META at least for services related to the metaverse.

In general, the main rule when someone wants to file a trademark is to check for earlier rights and to avoid possible conflicts which can lead to complex lawsuits and a lot of expenditures. Of course, there is another strategy, that however requires deep pockets for out-of-court agreements.

Source: Reuters.

How virtual goods and NFTs to be classified in trademark applications – the EUIPO’s position

With the development of the Metaverse infrastructure (a virtual space that wants to replicate the real world) and the advent of all sorts of new business opportunities, many companies start to consider trademark protection for the so-called virtual goods and services. They represent NFT ( non-fungible tokens ) blockchain records that can be purchased by consumers in the Metaverse.

For example, Nike has filed trademark applications for virtual clothes and shoes, McDonald’s for virtual food and burgers, etc. The goal is based on such protection no one else to sell similar NFTs using trademarks from the real world. Bear in mind that one trademark is protected only for the goods and services mentioned in its applications and so far virtual goods haven’t been included in the list as a whole.

From that perspective, one important issue has arisen – how such virtual goods or services to be classified under the Nice Classification that does not cover them now. Many Patent Offices have started to receive trademark applications and ask applicants for more clarifications because virtual goods can mean many different things.

In the light of this the EUIPO has issued its current position on that topic, stating the following:

  • Virtual goods are proper to Class 9 because they are treated as digital content or images. However, the term virtual goods on its own lack clarity and precision so must be further specified by stating the content to which the virtual goods relate (e.g. downloadable virtual goods, namely, virtual clothing).
  • The 12th Edition of the Nice Classification will incorporate the term downloadable digital files authenticated by non-fungible tokens in Class 9. NFTs are treated as unique digital certificates registered in a blockchain, which authenticate digital items but are distinct from those digital items. For the Office, the term non fungible tokens on its own is not acceptable. The type of digital item authenticated by the NFT must be specified.
  • Services relating to virtual goods and NFTs will be classified in line with the established principles of classification for services.
  • The Office’s approach is set out in the 2023 draft Guidelines on which a range of stakeholders have until 3 October this year to comment.

Acquiescence in case of trademark infringements – an EU Court decision

The European Court has ruled in case C‑466/20 HEITEC AG срещу HEITECH Promotion GmbH which concerns the issue of trademark acquiescence in case of a trademark infringement. The dispute has the following background:

The applicant in the main proceedings, Heitec, is the proprietor of the EU word mark HEITEC, applied for on 18 March 1998, with seniority claimed as from 13 July 1991, and registered on 4 July 2005.

It was entered in the commercial register in 1984 under the name Heitec Industrieplanung GmbH. Its name was changed in 1988 to Heitec GmbH. Since the year 2000, it has been operating under the name of Heitec AG.

Heitech, of which RW is the managing director, was entered in the commercial register on 16 April 2003.

Heitech is the proprietor of a German figurative mark containing the word element ‘heitech promotion’, applied for on 17 September 2002 and registered on 4 February 2003, which it has used since 29 September 2004 at the latest, and of an EU figurative mark containing the word element ‘heitech’, applied for on 6 February 2008 and registered on 20 November 2008, which it has used since 6 May 2009 at the latest.

By letter of 29 November 2004, Heitech contacted the representatives of Heitec to ask whether the latter would agree to conclude a coexistence agreement.

On 7 July 2008 Heitec became aware of Heitech’s application for registration of the EU figurative mark containing the word element ‘heitech’.

By letter of 22 April 2009, Heitec sent Heitech a warning letter regarding the latter’s use of its trade name and the EU trade mark containing the word element ‘heitech’. In its reply of 6 May 2009, Heitech again proposed the conclusion of a coexistence agreement.

On 31 December 2012, the Regional Court, Nuremberg-Fürth, Germany received, by fax, the application initiating proceedings, submitted by Heitec against Heitech and RW. That application was dated 15 December 2012. By decision of 4 January 2013, Heitec was asked to pay an advance on the costs of the proceedings.

On 12 March 2013, that court pointed out to Heitec’s representative that that advance payment had not been made and that the originals of the application initiating proceedings had not been lodged.

By letter of 23 September 2013, Heitec informed Heitech that it refused to conclude a coexistence agreement and proposed to conclude a licence agreement while stating that it had initiated legal proceedings.

By letter of 29 December 2013, Heitec informed Heitech that it was relying on its trade name and that it was the proprietor of the EU trademark HEITEC. It stated that the legal proceedings were pending.

On 30 December 2013, the Regional Court, Nuremberg-Fürth received written submissions from Heitec dated 12 December 2013, together with a cheque for court fees and a new application initiating proceedings bearing the date 4 October 2013.

On 14 January 2014, that court drew Heitec’s attention to the fact that it was also necessary to serve the application initiating proceedings of 15 December 2012, and Heitec was therefore asked to lodge the original documents. Those originals were received by the court on 22 February 2014.

On 24 February 2014, that court alerted Heitec to the fact that the heads of claim in the originals of the application initiating proceedings received on 22 February 2014 were not consistent with the heads of claim in the initiating application submitted on 31 December 2012.

On 16 May 2014, the Regional Court, Nuremberg-Fürth opened the preliminary written procedure and ordered that copies, drawn up by that court, of the initiating application of 15 December 2012 be served on the defendants in the main proceedings. Notice was finally served on 23 May 2014.

By that action, Heitec brought claims based, primarily, on the infringement of the rights conferred by its trade name HEITEC and, in the alternative, on the infringement of its EU trade mark HEITEC. It claimed that Heitech should be ordered to refrain from identifying its company by the trade name HEITECH Promotion GmbH, to refrain from affixing the word elements ‘heitech promotion’ and ‘heitech’ on goods and from marketing or advertising goods or services under those signs, to refrain from using or transferring, for commercial purposes, the website heitech-promotion.de and to agree to the removal of its company name from the commercial register. Heitec also brought claims for information, for a finding of an obligation to pay compensation, for the destruction of goods and for the payment of the costs of sending the warning letter.

The Regional Court, Nuremberg-Fürth ordered Heitech to pay Heitec EUR 1 353.80, plus interest, for the costs of sending the warning letter and rejected the other claims brought by Heitec.

Heitec appealed against the decision of the Regional Court, Nuremberg-Fürth before the Higher Regional Court, Nuremberg, Germany.

The Higher Regional Court, Nuremberg held that Heitec’s action was unfounded on the ground that Heitec was time-barred. In that regard, it noted that Heitech had used its later signs for an uninterrupted period of at least five years and that Heitec had acquiesced in such use, since, although it was aware of that use, it had not taken sufficient measures to stop that use.

According to that court, that court action had not interrupted the period of limitation, since it had been served on Heitech and RW only after five years had elapsed since the warning letter which preceded that action.

Heitec brought an appeal before the referring court.

That court notes that the outcome of the appeal depends on whether Heitec is, pursuant to Paragraph 21(1) and (2) of the Law on trademarks and Article 54(1) and (2) and Article 111(2) of Regulation No 207/2009, time-barred from bringing its claim for an injunction and its ancillary claims.

That court notes that the time-barring of Heitec’s claims relating, in essence, to the use by Heitech of the German trademark of which the latter is the proprietor, is governed by Paragraph 21(1) of the Law on trade marks, read in conjunction with Paragraph 125b(3) of that law, in so far as those claims are based on the EU trade mark of which Heitec is the proprietor.

It states that Paragraph 21(1) of the Law on trade marks transposes into German law the limitation provided for in Article 9 of Directive 2008/95, on the right conferred by trade marks (Article 9(1) of Directive 2008/95) and by other signs – including trade names – used in the course of business (Article 9(2) of Directive 2008/95), to oppose the use of a registered trade mark.

In so far as Heitec opposes the use of the trade name Heitech, the limitation is, according to the findings of the referring court, governed by Paragraph 21(2) of the Law on trademarks. In this regard, that court states that, notwithstanding the fact that the scope of that provision goes beyond that of Directive 2008/95 and is not reflected in Article 54 of Regulation No 207/2009, it must be interpreted on the basis of the interpretation of Paragraph 21(1) of the Law on trade marks which is consistent with that directive.

As regards Heitec’s claims concerning the use by Heitech of the EU trademark of which it is the proprietor, the referring court finds that Articles 54 and 110 and Article 111(2) of Regulation No 207/2009 are relevant.

That court notes that the Oberlandesgericht Nürnberg (Higher Regional Court, Nuremberg) did not err in law in finding that there was ‘use’, within the meaning of Paragraph 21(1) and (2) of the Law on trademarks and Articles 54 and 111 of Regulation No 207/2009, in the present case from 6 May 2009 at the latest and that Heitec had become aware of that by the letter of 6 May 2009 which Heitech had sent it. It is, moreover, common ground that Heitech is not accused of having acted in bad faith.

In the light of those circumstances, it is necessary to determine exactly what constitutes ‘acquiescence’ within the meaning of Article 9 of Directive 2008/95 and Articles 54 and 111 of Regulation No 207/2009.

In that regard, first, it is necessary to clarify whether it is possible to exclude acquiescence not only where an appeal is brought before an administrative authority or a court, but also in the event of the sending of a warning letter. Secondly, it is necessary to determine whether, in the event of court action it is necessary to take as a basis, in order to determine whether that action was initiated before the expiry of the period of limitation, the date on which the document instituting the proceedings was lodged or the date on which that document was received by the defendant. It is necessary, in that context, to clarify whether the fact that the service of that document is delayed through the fault of the proprietor of the earlier mark is relevant in that regard.

It is also necessary to determine whether the time limit applies only to an application for an injunction or also to claims that are ancillary or related to such an application, such as claims for damages, the provision of information and the destruction of goods.

In those circumstances, the Bundesgerichtshof (Federal Court of Justice, Germany) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1)      Can acquiescence within the meaning of Article 9(1) and (2) of [Directive 2008/95] and Article 54(1) and (2) and Article 111(2) of Regulation No 207/2009 be excluded not only by means of an administrative or court action, but also through conduct not involving a court or administrative authority?

(2)  If Question 1 is answered in the affirmative:

does the sending of a warning letter, in which the proprietor of the earlier sign, before initiating legal proceedings, requires the proprietor of the later sign to agree to refrain from using the sign, and to enter into an obligation to pay a contractual penalty in the event of an infringement, constitute conduct precluding acquiescence within the meaning of Article 9(1) and (2) of [Directive 2008/95] and Article 54(1) and (2) and Article 111(2) of [Regulation No 207/2009]?

(3)  When seeking judicial redress, is the bringing of the action before the court or the receipt of the action by the defendant decisive for calculating the five-year acquiescence period for the purposes of Article 9(1) and (2) of [Directive 2008/95] and Article 54(1) and (2) and Article 111(2) of [Regulation No 207/2009]? Is it significant in this regard that receipt of the action by the defendant is delayed beyond the expiry of the five-year period through the fault of the proprietor of the earlier trademark?

(4) Does the limitation of rights in accordance with Article 9(1) and (2) of [Directive 2008/95] and Article 54(1) and (2) and Article 111(2) of [Regulation No 207/2009] encompass consequential claims under trade mark law, for example, claims for compensation, provision of information or destruction, as well as prohibitory injunctions?’

The Court’s decision:

1.  Article 9 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 and Articles 54, 110 and 111 of Council Regulation (EC) No 207/2009 of 26 February 2009 on the Community trade mark must be interpreted as meaning that an act, such as a warning letter, by which the proprietor of an earlier mark or other earlier right opposes the use of a later mark without taking the necessary steps to obtain a legally binding solution does not stop acquiescence and, consequently, does not interrupt the period of limitation.

2.  Article 9 of Directive 2008/95 and Articles 54, 110 and 111 of Regulation No 207/2009 must be interpreted to mean that the limitation in consequence of acquiescence referred to in those provisions may not be prevented by the bringing of a court action in which the proprietor of an earlier mark or other earlier right sought a declaration of invalidity of a later mark or opposed the use of that mark, where the application initiating proceedings, although filed before the date of expiry of the period of limitation, did not, owing to a lack of diligence on the part of the applicant, satisfy the requirements of the applicable national law for service and was rectified only after that date for reasons attributable to the applicant.

3.  Article 9 of Directive 2008/95 and Articles 54, 110 and 111 of Regulation No 207/2009 must be interpreted as meaning that, where the proprietor of an earlier mark or other earlier right, within the meaning of those provisions, is time-barred from seeking a declaration of invalidity of a later mark and from opposing the use of that mark, that proprietor is also time-barred from bringing ancillary or related claims, such as claims for damages, the provision of information or the destruction of goods.

Christian Louboutin failed to register its red sole as a trademark in Japan

The popular shoe manufacturer Christian Louboutin is well-known for the attempt to register the red soles of its shoes as a trademark around the world. This creates a lot of disputes either with the local Patent Offices or with competitors.

One such attempt, this time in Japan, was decided by the Japan Patent Office and the result is not encouraging for the company.

Christian Louboutin tried to register the following figurative trademark in class 25:

The Patent Office issued a refusal based on absolute grounds – lack of distinctive character and the fact that this form has an aesthetic purpose because of which consumers are attracted to buy.

Christian Louboutin appealed by submitting evidence for acquired secondary distinctiveness. The main piece of evidence was an online brand awareness survey covering three cities in Japan. According to the survey, in the case of open-ended questions, 43.35% of the respondents recognized the red sole as a Christian Louboutin product. In the case of closed-ended questions, 53.99% reached that conclusion.

Still, the Patent Office wasn’t impressed. The reason was that this survey covered only locations where the company had stores, it didn’t show consumer awareness on a national level.

In addition, the Office considered that such registration could restrict competition because many other shoe manifacturers had used similar appearance for their products.

What is certain in such difficult cases is the need for good preparation. Only one piece of evidence, including a survey, most likely will not be able to solve the matter. An entire strategy and much more support are necessary in order to color trademark applications to be successful in most countries.

Source: Masaki MIKAMI, MARKS IP LAW FIRM.

Tesla filed a trademark lawsuit against similar trade signs in China

The world’s most famous electric vehicle manufacturer TESLA has initiated a lawsuit in China against the local company Sino Drinks Food Company for infringement of trademark TESLA and the following figurative mark:

Sino Drinks Food Company offers beer and liqueur under a similar name TESILIA and a similar figurative sign.

Most likely the grounds for the dispute will be a trademark with reputation and unfair competition because Tesla does not have a registered mark for alcohol in China. As far as it is known this Chinese company has registered about 200 other trademarks that imitate famous signs.

Source: Alice Liang, The Drinks Business.