Widening the scope: genuine use of trademarks

In the well-known Bainbridge decision dating from 2007 (C-234/06), the Court of Justice for the EU (CJEU) decided in an obiter dictum that it is not admissible to extend the protection afforded to a registered mark by virtue of the proof of use thereof, to a different mark which has been registered but not used, on the grounds that the latter mark is merely a slightly altered form of the former mark.

The question to be clarified in this instance was whether it is possible to use a word/figurative mark ‘Bridge’ by proving the use of the word mark ‘The Bridge’.

Although the CJEU merely expressed an opinion on the interpretation of Article 15(2)(a) of the Community Trade Mark Regulation (CTMR), the court itself pointed out that the content of this provision is identical to that of Article 10(2)(a) of the Trade Marks Directive; the same therefore applies to the provision in Section 26(3) of the German Trade Mark Act.

There is consistency between Section 26(3)(1) of the German Trade Mark Act and Article 15(2)(a) CTMR; Section 26(3)(2) of the German Trade Mark Act, however, has no equivalent in European law.

According to this German provision, a genuine use of a mark by the use of a sign differing in elements which do not alter the distinctive character of the mark is also permitted when the mark is also registered in the used form. This led to a discussion in the German literature about the compatibility of the German provision with EU law.

The CJEU now has the opportunity to define the scope of its rulings on the Bainbridge decision, in its answer to two questions from the German Court of Justice.

The Proti case

In this matter (decision of August 17, 2011 ZR 84/09) the German Court of Justice referred the interpretation of Article 10(1) and (2)(a) of Directive 89/104/EEC to the CJEU and, in particular, asked for a decision on whether Section 26(3)(2) of the German Trade Mark Act is consistent with it.

While the defendant claimed that the plaintiff had not genuinely used the mark ‘Proti’, the plaintiff asserted use of the mark based on use of the registered marks ‘Proti Power’ and ‘Proti Plus’. This would be admissible under German law, but is now uncertain following the CJEU’s Bainbridge decision.

In the opinion of the German Court of Justice, Section 26(3)(2) of the German Trade Mark Act is consistent with Article 10(2)(2) of the Trade Marks Directive. This should not apply when a single mark is used and other unused marks are registered simply to extend the scope of protection, which is the case with so-called defensive marks.

The court substantiates its opinion on the basis that, by using a sign as a trademark, more than a single registered mark is being put to genuine use. The compatibility is also substantiated in that the requirement of genuine use is intended to reduce the number of marks registered in the EU and, therefore, the number of potential conflicts.

“It is very beneficial for the mark owner to adapt his registered mark to the circumstances of the time and to develop it within the boundaries permitted by the German Trade Mark Act and the Trade Marks Directive.”

The German Court of Justice also rightly points out that the requirement of genuine use is not intended to destroy, without a compelling reason, the economic value inherent in earlier marks, nor to prevent the mark owner from developing and modernising his existing mark.

It is very beneficial for the mark owner to adapt his registered mark to the circumstances of the time and to develop it within the boundaries permitted by Section 26(3)(1) of the German Trade Mark Act and Article 10(2)(a) of the Trade Marks Directive.

However, if it were not possible for the trademark owner to put both its marks—the originally registered mark and the modernised registered mark—to genuine use by using the developed registered form, it would lose the priority of the earlier mark.

If the new, developed mark is not registered, however, there is a risk that this new mark will fall outside the boundaries of Section 26(3)(1) of the German Trade Mark Act and Article 10(2)(a) of the Trade Marks Directive. Accordingly, the original mark will then be lost through lack of use and the new mark will not be protected by registration.

The ‘clothing tabs II’ case

In this instance (decision of November 24, 2011 I ZR 206/10), the German Court of Justice referred Article 15(1) of Council Regulation No. 40/1994 of December 20, 1993 on the CTMR to the CJEU for interpretation. In this case, the plaintiff attempted to substantiate the use of a registered mark (red tab on a pocket) by using it in combination with a further mark (word mark ‘Levi’s’).

The combined form, which was actually used exclusively, is also registered as a trademark. The defendant therefore challenged the use of the position mark and declared that only the registered combined mark was used.

The difference from the Proti decision was that the combined mark and the position mark do not differ from one another solely in component parts which do not affect the distinctiveness of the marks. Article 15(2)(a) CTMR is therefore irrelevant. In the opinion of the German Court of Justice, however, a genuine use of the mark as a component sign of a used combination mark can also be used as a basis in this case.

It supports the genuine use of the position mark by the combined mark that a mark can acquire distinctiveness within the meaning of Article 3(3) of Directive 89/104/EEC through use as a component of a registered mark without the mark which is to be registered having been used independently (CJEU, judgment of July 7, 2005, C-353/09).

The German Court of Justice pointed out that the trademark owner’s interest in effective enforcement of its marks needs to be taken into account. It would also like to allow registration of individual components of a combined mark, which are recognised by the market as an independent characteristic.

If the trademark owner enjoys separate protection under trademark law for a component of a combined sign, there will be a greater similarity and likelihood of confusion if the component is found in a similar, or identical, form in the conflicting sign.

In both decisions, the German Court of Justice states that it deems the Bainbridge decision of the CJEU to be applicable only in cases of inadmissible defensive marks. The CJEU’s response to the two questions referred for a preliminary ruling is therefore eagerly awaited, as this is the CJEU’s first opportunity to define the scope of its 2007 decision. It is hoped that the CJEU will provide clarification to the effect that its decision is to be restricted to inadmissible defensive trademarks.