Using a trademark as a decorative element is not the best option for its protection in the EU

The General Court of the European Union has ruled in the case T‑323/21 Castel Frères v Shanghai Panati Co., which reminds us how essential is one registered mark to be used correctly in order for its protection to be viable.

The case has the following background:

On 29 May 2018, Shanghai Panati Co filed an application with EUIPO for revocation of the EU trademark that had been registered further to an application filed on 17 March 2008 for the following figurative sign:

The goods covered by the contested mark, in respect of which a declaration of invalidity was sought, were inter alia in Class 33 of the Nice Agreement: ‘Still wines’.

The ground relied on in support of the application for revocation was the lack of genuine use of the contested mark within a continuous period of five years.

Evidence was submitted by Castel Frères that the mark was used for wine labels in the following way:

On 3 April 2020, the Cancellation Division rejected the application for revocation.

On 24 April 2020, Shanghai Panati Co. filed a notice of appeal with EUIPO against the decision of the Cancellation Division.

By the contested decision, the Board of Appeal upheld the appeal and revoked the contested mark. The Board of Appeal found, in essence, that the differences between the contested mark and the mark as used were such as to alter the distinctive character of the contested mark.

The Court upheld this decision.

According to the Court, it must be borne in mind that the contested mark in its registered form is a figurative mark consisting of three characters from the Chinese alphabet. As the Board of Appeal correctly notes the relevant public will not be able to verbalise or to memorise those Chinese characters, which will rather be perceived as meaningless, abstract signs or as decorative elements referring to China or to Asia. It is appropriate, therefore, to find that, with regard to the goods at issue, the Chinese characters forming the contested mark have a lower-than-average degree of distinctive character.

In that regard, it must be emphasised that on the product packaging or in the advertisements, the contested mark, which appears in a very small size, is almost systematically accompanied by the word elements ‘dragon de chine’ and by the representation of a dragon, which appear together and are very close to one another. Moreover, in so far as the contested mark is composed of three characters from the Chinese alphabet, in a very small size, the added elements are always clearly visible and dominate the overall impression.

The Board of Appeal was therefore right to find that the contested mark as used, that is to say, in an ancillary position and in a much smaller size than the distinctive and dominant word elements ‘dragon de chine’ and the representation of a dragon, would be perceived by the relevant public as a decorative element and not as an indication of origin of the goods.

That finding cannot be called into question by the argument that, in essence, it is common in the wine sector for two or more trademarks to be used jointly and autonomously on labels, with or without the name of the manufacturer’s company, as is the case here with the mark Dragon de Chine. It must be stated that the word elements ‘dragon de chine’ are always clearly visible in that they occupy a dominant position in the overall impression created by the mark as used. In any event, even if it were established that those elements are a trademark, the fact remains that that is not capable of weakening the alteration by those terms of the distinctive character of the contested mark, since the relevant public no longer perceives those three characters from the Chinese alphabet as an indication of the origin of the goods in question, in accordance with the case-law.

Having regard to the above examination of the distinctive and dominant character of the added elements, based on the intrinsic qualities of each of those elements and on the relative position of the various elements, it must be held that the variations in use demonstrated alter the distinctive character of the contested mark as registered, as the Board of Appeal rightly found.

This decision comes to remind us that one trademark should always be used as an indication of trade origin and not as a complimentary or decorative element. In a similar case, Apple lost a dispute regarding its trademark Think Differently because of the way the mark was used on the package of the product.

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.

China joins the Hague System for international registration of industrial designs

WIPO reports about the accession of China to the Hague System for the International Registration of Industrial Designs.

As it is well known, Hague System allows up to 100 designs to be included in one application and after that registered in 90 Member states. This saves a lot of time and money for the applicants.

The Agreement will come into force for China on 05.05.2022, after this date the country can be designated in applications for industrial designs.

Puma won a trademark dispute in China

Puma won a trademark dispute in China. The case at hand concerns the following registered trademark by Ningbo Spark Motor Co., Ltd. in 2005 for class 7 – mechanical engines, gasoline and diesel generator sets, water pumps, washing machines, construction machinery, agricultural machinery, etc.:

The Chinese characters “彪马” (BIAO MA) within the mark mean Puma in translation.

Puma initiated an invalidation proceeding against this mark based on early registered trademarks Puma for class 25 clothes, shoes etc.

The Patent Office dismissed the invalidation finding both marks dissimilar for completely different goods and target consumers.

In the appeal, the Court upheld this conclusion stating that there is no possibility for a consumer confusion even though the submitted evidence that Puma is a well-known trademark.

A new appeal followed and this time the Beijing Hight Court overturned the court of first instance decision. According to the Court in the case at hand the registered later mark was against article 13.3 of the China Trademark Law or the so-called “well-known mark dilution”. This means that the later mark takes advantages from the reputation of the earlier mark even for dissimilar goods weaken its distinctive quality.

This decision is interesting and contrast significantly with the General Court of the EU recent decision where Puma lost the case against figurative mark for class 7.

Source: CCPIT Patent & Trademark Law Office – Ling Zhao and Lan Zhou за Lexology.

China joins the TMView database

EUIPO reports about the addition of the China national trademark database to the global database TMView. In that way additional 32 million trademarks are accessible through TMView which now covers more than 96 million trademarks from around the world.

This is definitely a good news for every company that plans to enter the China market with own brand. Searching for earlier already registered trademarks is a key element when it comes to avoiding unnecessary trademark conflicts.

Source: EUIPO.

New Balance won a $2.8 million lawsuit in China

The US sportswear company New Balance has won an important lawsuit in China related to its trademark.

The case at hand concerns the Chinese company New Barlun that uses the letter N on shoes. This letter is a New Balance well-know trademark all over the world. However, New Barlun succeeded to registered the sign first in China.

The US company initiated a lawsuit seeking invalidation of the mark based on a bad faith registration that took advantages of the New Balance’s trademark global reputation.

The court concurred with the US company finding bad faith approached by New Barlun, which was proven by the fact that the Chinese company failed to cease infringement despite the court issuing an interim injunction order.

The Court ordered $2.83 million in damages to New Balance for the trademark infringement. This is one of the biggest sum awarded by a Chinese court in case of trademark infringement in the field of sportswear.

Another indicative moment regarding this dispute is that trademark registration doesn’t mean a save harbor for the relevant applicant if the mark is registered in bad faith especially in light of worldwide well-known brands.

Source: WIPR.

Daren Tang is the new WIPO General Director

Daren Tang officially become Director General of the World Intellectual Property Organization. He succeeds Francis Gurry in this position after tense election in the light of the economic and political conflict between the US and China.

Mr. Tang is a former Chief Executive of the Intellectual Property Office of Singapore and will serve as WIPO General Director for a mandate of six years.

For more information here.