The need for preventive action

15-04-2015

Julia Holden and Andrea Ghirardelli

On January 9, 2015, a decision (123/2014) by the Italian opposition division of the Italian Patent and Trademark Office (IPTMO) brought to an end a three-year trademark dispute between two companies interested in using the same name in Chinese script.

In November 2011, China Depend, which is also based in Italy, filed a trademark application with the IPTMO for the sign ‘路 虎’—the two characters of which translate as ‘street’ and ‘tiger’.

Land Rover—which uses the sign in China for its brand—filed an opposition with the Italian registry, claiming that ‘路虎’ is the Chinese name for Land Rover. Indeed, Land Rover provided evidence that it uses this sign in China.

The analysis of the likelihood of confusion between two signs is based on a visual, aural and conceptual assessment, and the risk of consumer confusion and/or association.

According to the IPTMO, there was no visual confusion between ‘Land Rover’ and‘路虎’. Obviously, there are no visual similarities and the words are in different languages.

Furthermore, the office’s examiner said it was impossible to perform an aural or conceptual examination of the marks. Important to this decision was that for the average Italian consumer, ideograms such as ‘路虎’ are devoid of linguistic meaning. In fact, the average Italian consumer cannot either pronounce the word ‘路虎’ (aural examination) or understand its meaning (conceptual examination).

As a result, these two tests were not performed and there was no official declaration of the likelihood of confusion between the signs.

To support its opposition, Land Rover noted that although the sign ‘路虎’ was addressed to Italian national consumers, there is a large Chinese community in Italy that could be confused.

In response, however, the IPTMO stated that the Italian Chinese population is mainly concentrated in certain geographic areas and that, on the contrary, the Italian trademark application is bound to have an effect on the entire nation. Consequently, the IPTMO held that the ‘reasonable’ Italian consumer is unfamiliar with the Chinese language, and so the application was allowed to proceed.

In fact, the IPTMO rejected Land Rover’s opposition on the grounds that the average Italian cannot speak/understand Chinese and, as a result, there was no risk of confusion between the signs in Italy.

As a consequence of this decision, Italian companies now face the potential risk of having their company name (or trademark) registered by third parties in the Chinese language and finding that it may be accepted and used in Italy as a valid trademark.

The possible negative implications of this decision are, therefore, wide. Indeed, the ruling could be used as precedent in future decisions regarding other alphabets with different scripts, such as Arabic and Cyrillic.  

The decision appears, at first glance, to be a logical one. The analysis that the IPTMO carried out for this trademark opposition was necessarily limited and did not bear in mind the wider international community living in Italy, or the wider reputation already acquired by Land Rover’s Chinese mark in another large jurisdiction—namely, China.

"Italian companies now face the potential risk of having their company name (or trademark) registered by third parties in the Chinese language."

One has to assume that an Italian court, when deciding on a cancellation action, would take into account a far broader picture and other important aspects. These would include any possible bad faith on the applicant’s part (one could argue that China Depend was surely aware of the mark in China), unfair competition, and article 6-bis of the Paris Convention—relating to broader protection for well-known trademarks. It can only be hoped that a different and more rational decision would be reached in these circumstances.

Naturally this is a hard lesson for brand owners but it signals once again the importance of taking all protective measures to register a trademark at the filing stage, especially in different scripts, and where there is an international community. Early preventive and protective action are clearly much less costly than an opposition or even court cancellation proceedings at a later stage. 

Julia Holden is a partner at Trevisan & Cuonzo. She can be contacted at: jholden@trevisancuonzo.com

Andrea Ghirardelli is a trainee at Trevisan & Cuonzo. He can be contacted at: aghirardelli@trevisancuonzo.com

IPTMO, trademark, trademark application, Land Rover, China Depend

WIPR