shutterstock_1176271219_ivan_marc
14 October 2022TrademarksCatherine Wycherley

E-commerce platform loses TM challenge over Brexit dates

Shopify’s cancellation attempt against a UK competitor fails | EU court rules the contested mark was adopted after the UK’s Brexit transition period.

The General Court (Ninth Chamber) has dismissed Shopify’s attempt to cancel a European Union (EU) trademark held by marketplace app Shoppi, in a case that hinged on the timing of the UK’s decision to leave the EU.

The court handed down its decision on Wednesday, October 12.

The Canadian e-commerce platform had challenged an earlier decision by the EU Intellectual Property Office (EUIPO) Board of Appeal, which held that there was no likelihood of confusion between the EU figurative mark ‘Shoppi’ and ‘Shopify’.

The Board of Appeal decision also held that there was a lack of enhanced distinctiveness of the earlier mark.

Shopify had argued that use of its mark in the UK should be valid evidence for its enhanced distinctiveness because when the application to file the contested mark was made, on May 8, 2017, the UK was still a member of the EU.

But the contested decision was adopted on February 18, 2021, after the end of the UK’s so-called transition period on December 31, 2020, marking its official exit from EU membership.

The General Court therefore upheld the earlier decision that “evidence of reputation or enhanced distinctiveness relating to the United Kingdom could no longer sustain or contribute to the protection of an EU trademark as from 1 January 2021, even if that evidence predated 1 January 2021.”

The General Court explained that: “It is apparent from the case law of the Court that, in the context of cancellation proceedings, the proprietor of an industrial property right, particularly an earlier mark, must establish that he or she may prohibit the use of the EU trademark at issue, not only on the filing or priority date of that mark but also on the date on which EUIPO decides on the application for a declaration of invalidity… The same applies, a fortiori, in the context of opposition proceedings.”

It continued: “It follows, in essence, that, for the evidence of enhanced distinctiveness of the earlier mark acquired through use in the United Kingdom to be relevant for the application for a declaration of invalidity of the contested mark, that use must still be capable of being relied on at the date on which EUIPO rules on the application for a declaration of invalidity. In the present case, however, the date of the contested decision—18 February 2021—post-dates the expiry of the transition period.”

The General Court therefore endorsed the Board of Appeal’s conclusion that the earlier mark in the UK was no longer enforceable, and evidence relating to it should be disregarded.

Furthermore, the ruling added: “It must be noted, as EUIPO has done, that, in the light of the fundamental principle of territoriality of intellectual property rights, set out in Article 1(2) of Regulation 2017/1001, after the expiry of the transitional period, no conflict can arise in the United Kingdom between the contested mark and the earlier mark, which are no longer protected in that territory. At the date of the contested decision, the public of the United Kingdom was no longer part of the relevant public of the European Union.”

The judgment concluded that: “the fact remains that the requirement of permanence or persistence of the prior right at the date on which EUIPO rules on the application for a declaration of invalidity is a matter of enforceability, previous to such a substantive assessment.”

Shopify was ordered to pay costs.

Counsel for Shoppi, Alexander Hogertz, said: “We are glad that the [General Court] has confirmed the important principle that a likelihood of confusion cannot be established based on descriptive elements of the trademarks.”

“The judgment is of particular importance, especially in light of the steadily growing number of applications for and uses of trademarks that contain descriptive elements or are based on them. It is therefore an important source of case law for deciding future collision cases of such trademarks,” added Vivian Roth, who also represented the app.

Shoppi co-founder Maria Denise Vacante said: “We fought not only for ourselves but also for those who don't have the chance to do so—it is not easy for a start-up to bear the cost and burden of a trial. We believe the result of this case is meant to give hope to other innovators like us, not to be intimidated by larger realities and to pursue their ideas no matter what.”

WIPR has approached Shopify for comment.

Did you enjoy reading this story?  Sign up to our free daily newsletters and get stories sent like this straight to your inbox.

Today’s top stories

Ed Sheeran's US trial: how would this play out in the UK?

SCOTUS to look at ‘fair use’ in Warhol 'Prince Series' case

Already registered?

Login to your account

To request a FREE 2-week trial subscription, please signup.
NOTE - this can take up to 48hrs to be approved.

Two Weeks Free Trial

For multi-user price options, or to check if your company has an existing subscription that we can add you to for FREE, please email Adrian Tapping at atapping@newtonmedia.co.uk


More on this story

Trademarks
25 May 2023   Non-UK based rights holders should consider appointing a UK address for service before January next year to avoid potential pitfalls, says Lauren Somers of HGF.
Patents
2 September 2022   E-commerce platform owes damages for infringing three patents; Express Mobile continues litigation strategy that has targeted Meta, Amazon, Google and Dropbox.
Copyright
23 March 2020   An Australian federal judge has ordered Shopify to name the owner of a website accused of selling unlicensed Aboriginal flags.