21 November 2018Trademarks

EU court serves victory to PepsiCo in TM appeal

The EU General Court has today sided with PepsiCo in a trademark invalidation case.

German snack brand Intersnack Group applied to register ‘Exxtra Deep’ as a trademark with the European Union Intellectual Property Office (EUIPO) in 2013, covering classes 29, 30, and 31.

The mark, which was registered in 2014 (number 012,161,981), covers a range of snacks, such as crisps, nuts, and cereal bars.

In the same year, soft drinks maker Pepsi sought to invalidate the mark, claiming that the trademark was registered in violation of article 7(1)(b) and (c) of regulation 2017/1001.

Under article 7, a trademark cannot be registered if it is devoid of distinctive character or only describes the characteristics of the goods it covers.

In 2017, the EUIPO’s Cancellation Division granted the application for invalidity with respect to most of the goods in classes 9 and 30. The division found that the word ‘Deep’ is descriptive of deep ridges, a shape which crisp manufacturers use in their products, so ‘Exxtra Deep’ would be understood as a product descriptor.

However, it added that this finding only applied to crisps and related goods, meaning that the registration of the mark could be maintained for products such as dried fruits and preserved vegetables in class 29.

Pepsi appealed against the decision, but the EUIPO’s Fourth Board of Appeal upheld the Cancellation Division’s finding.

At the General Court, Pepsi again requested that the ‘Exxtra Deep’ mark be invalidated in relation to the remaining goods in class 29.

The soft drinks manufacturer referred to the link between potatoes, which are a vegetable, and crisps, the final product, and said that the board erred in reducing the remaining goods in class 29 to their raw materials rather than considering the finished product (eg, crisps).

Pepsi criticised the board for acknowledging the descriptive character of the disputed mark for goods such as ‘processed vegetable and potato products for snacks’ in class 29, while excluding it for ‘preserved, dried and cooked fruits and vegetables’ in the same class.

Today, the General Court noted that the finding that a mark has descriptive character “applies not only to goods for which it is directly descriptive, but also to the more general category to which those goods belong”.

The court said it “cannot be denied” that potatoes, which make crisps, are vegetables, or that crisps can be made from other products. The court also agreed with Pepsi’s argument that crisps can be made from fruit or vegetables, and can be fried, dried, or cooked.

“The Board of Appeal erred in failing to draw the consequences of the finding that the contested mark had descriptive character for ‘extruded and pelletised or otherwise manufactured or processed vegetable and potato products for snacks’ in Class 29, for the assessment of its descriptive character for ‘preserved, dried or cooked fruits and vegetables’ in the same class,” said the court.

Finally, the court concluded that the ‘Exxtra Deep’ trademark lacks distinctive character.

Siding with Pepsi, the General Court annulled the EUIPO’s decision not to invalidate and cancel the trademark in respect of ‘preserved, dried and cooked fruits and vegetables’ in class 29.

The court told Intersnack to bear its own costs, and ordered the EUIPO to pay the costs incurred by Pepsi.

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