Can anyone register an EU trademark for Powerball?

Filing a trademark application in bad faith can jeopardise seriously trademark’s future protection because legislation allows such marks to be canceled.

One interesting example of such consequences is from the EU, where the Gibraltar-based company for online bets Lottoland successfully registered a trademark for “Powerball” in classes 35, 41, and 42.

As it is well-known “Powerball” is a US lottery, probably one of the most famous in the entire world, with a record jackpot of $1.5 billion USD.

The lottery is organized by the US Multi-State Lottery Association, whose EU trademark for Powerball was revoked based on non-use for 5 consecutive years.

When the US Accossiation found out about the later trademark Powerball it filed a cancelation request with the EUIPO claiming bad faith. According to the Association, the purpose of the Gibraltar company was to mislead the EU consumers about the real organizer of the lottery. Evidence for such dishonest behavior was the fact that Lottoland registered trademarks for other lotteries such as  EuroMillions and EuroJackpot whose organizers are different.

In contrast, Lottoland counterclaimed that its trademark was legally registered because Powerball has no reputation amongst the consumers in the EU.

The EUIPO agreed with the US Association and canceled the EU mark based on bad faith attempt in regard to its registration. According to the Office, there is no need for one trademark to be known in the EU in order bad faith claim to be possible. The Office considered Lottoland’s behavior dishonest, trying to restrict the real owner of the mark to use it in the EU as well as all other market participants, from one side, and to mislead consumers, from another.

The conclusion of this case is that you need to bear in mind the fact that although one trademark protection has lapsed, this does not mean automatically the sign can be used by someone else. Such use should be analyzed carefully considering all facts and risks.

Source: FRKelly – Adam Flynn for Lexology.

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.

New forms for filing European trademarks and designs

The EUIPO reports about the upcoming launch of a new form for filing European trademarks and designs that will be available on 01.08.2022. This new form is part of a smooth transition to the new website and User Area that will provide:

  • customization options allowing you to tailor your filing experience;
  • a new design with full guidance and contextual help;
  • faster goods and services management;
  • enhanced security.

An instructional video can be found here.

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.

Apple lost an EU dispute regarding its THINK DIFFERENT trademarks

The General Court of the European Union has ruled in joined cases T‑26/21 to T‑28/21, Apple Inc. v Swatch AG.

These cases concern registered EU trademarks THINK DIFFERENT owned by Apple against which an application for revocation was filed by the Swiss company SWATCH. The gound for the application was non-use for a period of 5 consecutive years.

Apple submitted evidence for genuine trademark use within the EU but the EUIPO and the Board of Appeal after that dismissed them as insufficient.

The General Court upheld the EUIPO’s position on the case. The reason for this negative result for Apple was hidden in the details of how the marks were used and how this was proved.

From the Court decision:

The applicant complains that the Board of Appeal did not take into account the high level of attention of the relevant public when assessing whether the contested marks had been put to genuine use. In particular, it claims that the Board of Appeal disregarded the case-law according to which consumers pay a high level of attention when purchasing durable and highly technical goods and, at the same time, closely inspect their technical specifications. The Board of Appeal thus concluded, wrongly, that the relevant public would carelessly overlook the top part of the packaging of iMac computers displaying their specifications.

Furthermore, according to the applicant, the Board of Appeal failed to take into account the fact that computers and computer accessories in Class 9 are often sold ‘as seen’ on the shelves of department or specialist stores, where consumers have the opportunity to inspect their packaging visually before purchasing them. It adds that, in those stores, in a typical configuration, those goods are sold on a self-service basis, as the new photographs in the application show, and in that case consumers rely primarily on the original packaging.

It is important to note, however, that, even if the Board of Appeal did not consider the high level of attention of the relevant public for personal computers and computer accessories in Class 9, that cannot have any bearing on the conclusion according to which the contested marks accounted for only a rather insignificant space next to the barcode. In any event, the applicant has not demonstrated that such consideration would have led the Board of Appeal to find that the consumer would examine the packaging in any detail and that he or she would pay particular attention to the contested marks.

As regards the process of purchasing the goods at issue, it should first be noted that, in certain cases, computers and computer accessories in Class 9 may indeed be sold on a self-service basis to consumers, displayed on shelves. Next, in other cases, as the intervener points out, they are stored in a place which is not directly accessible to the public (for example, in their packaging or in a storeroom). Consumers may, however, try out the display models that are presented without their packaging on the table and consult the technical sheets placed next to each product. Last, those goods may also be purchased online, on the basis of information appearing in special catalogues or on the internet.

The applicant complains, in essence, that the Board of Appeal erred in finding that the sales figures for iMac desktop computers provided by the applicant related only to certain Member States of the European Union, namely the United Kingdom, Finland, Denmark and Germany. It claims to have sold more than four million iMac computers under the mark THINK DIFFERENT during the relevant period throughout the European Union, as is allegedly proved by the witness statement of the director of its legal department, dated 23 March 2017.

In the present case, as EUIPO correctly submits, the witness statement was drawn up by the director of the applicant’s legal department and therefore cannot have the same reliability and credibility as a statement from a third party or a person who is independent of the company in question. Accordingly, that statement is insufficient in itself and merely provides an indication which must be confirmed by further probative evidence (see, to that effect, judgment of 21 September 2017, Repsol YPF v EUIPO – Basic (BASIC), T‑609/15, EU:T:2017:640, paragraph 64 and the case-law cited).

In that regard, it should be noted that, according to the witness statement of 23 March 2017, more than four million iMac computers under the mark THINK DIFFERENT were actually sold throughout the European Union during the relevant period. Those sales figures contained in the witness statement are not, however, confirmed by any further probative evidence. Indeed, the annual reports for the years 2009, 2010, 2013 and 2015, attached to the witness statement of 23 March 2017, contain only information on the net worldwide sales of iMac computers. They do not provide any details as to the sales figures of iMac computers in the European Union.

The applicant claims that, contrary to the Board of Appeal’s reasoning, the joint use of multiple trade marks on the packaging of iMac desktop computers cannot, in itself, undermine the function of the contested marks as a means of identifying the goods concerned. In its view, the contested marks were used jointly, but autonomously, with the other marks affixed to the packaging of iMac computers in so far as they were set clearly apart from the other marks on the packaging and at sufficient distance from the nearest mark, namely Macintosh.

The applicant criticises the Board of Appeal for having taken into account, in its assessment of the genuine nature of the use of the contested marks, new criteria, contrary to established case-law. According to the applicant, there is no case-law requiring it to be demonstrated that the contested marks have been affixed to a particular place on the packaging of the product concerned and that they appear in large letters.

It is true, as is apparent from the case-law relied on by the applicant, that there is no precept in the EU trade mark system that obliges its proprietor to prove the use of its earlier mark on its own, independently of any other mark or any other sign.

However, a registered trade mark that is used in conjunction with another mark must continue to be perceived as indicative of the origin of the product at issue for that use to be covered by the term ‘genuine use’ within the meaning of Article 15(1) of Regulation No 207/2009.

In the present case, it should be noted that, contrary to what the applicant claims, the Board of Appeal did not base its conclusions as to the lack of genuine use of the contested marks solely on the finding of the presence of the word mark Macintosh on the packaging of iMac computers next to the contested marks.

On the contrary, the main ground on which the Board of Appeal based its conclusion is that some of the evidence produced by the applicant to that end falls outside the relevant period and that the images produced by the applicant show the contested marks in a single place on the box packaging and that that use alone could not be regarded as genuine in the light of the characteristics of that use, in particular its size and location.

Second, as regards the requirements linked to the positioning and size of the contested marks on the packaging, it is apparent from the case law cited in paragraph 61 above that genuine use of a mark can be found only where that mark is used to guarantee the identity of the origin of the goods or services for which it was registered.

In the present case, as the photographs of the iMac computer packaging in the file illustrate, the word elements ‘think different’ do not appear on the labels affixed to the box packaging in a way which particularly draws the consumer’s attention. On the contrary, those word elements are placed under the technical specifications of the iMac computers, and just above the barcode in a relatively small character size. That expression is, moreover, accompanied by the word ‘macintosh’ of the same size and written in the same font.

It must therefore be concluded that the way in which the contested marks are used on iMac computer packaging does not ground the conclusion that they have been used as trademarks, that is to say, in accordance with their essential function of giving an indication of the commercial origin of the goods concerned.

All of these shows how important trademark placement is. It should be clear and in a way to indicate trade origin. In such cases putting a small R in a circle after the mark could be really helpful because it will show trademark protection.

JUST EGG cannot be an EU trademark in relation to egg substitute

The Board of Appeal of the EUIPO has ruled in a case where the US company Eat Just, Inc. tried to register a European trademark for JUST EGG in class 29: Plant-based egg substitute; liquid egg substitute; plant-based processed food.

The EUIPO refused registration of the sign based on Article 7(1)(g) EUTMR (misleading character), in conjunction with Article 7(2), EUTMR for all the goods.

According to the Office, the English-speaking part of the European consumers will understand the sign as “merely/only egg”. This comes into conflict with the goods specified in the application which targets an egg substitute. So from that perspective consumers can erroneously assume, based on the meaning of the mark, that the goods under it are not plant-based where they will be such one.

The Board upheld this decision in its entirety.

This case shows clearly how important is for good preparation to be done before filing a trademark application. If there is a conflict between the brand name and the goods or services specified in the application the chances for refusal by the Patent Office will rise significantly.

Zara failed to take advantage of Brexit in a trademark dispute

The General Court of the European Union has ruled in case  T‑467/20, Inditex v EUIPO.

In 2010 Inditex filed an application for an EU mark for ZARA in classes 29, 30, 31, 32, 35, 43.

Against this application, an opposition was filed by Ffauf Italia SpA based on earlier marks ZARA and LE DELIZIE ZARA, some of which were UK national marks, for classes 29 and 30.

The dispute has lasted ten years until Inditex appealed the EUIPO’s decision before the General Court. The company raised a new plea wanting the Court to exclude some of the earlier UK marks because of Brexit.

The Court dismissed this claim stating that the date for assessing the relative grounds was the date of filing the opposition when the UK was still an EU Member State. Brexit in this case was irrelevant to the assessment of the facts in the case.