Hollowed Out - Can You Register a Geographical Name as a Trademark?

The origin of the materials of goods can be very influential as a part of a consumer's purchase decision, often signalling particularly high quality or desired traits not seen in similar materials from elsewhere. As such the location's name carries weight, and many different products can be made from the materials from the same source, albeit potentially still varying in quality. Being able to use the location's name is therefore quite important to all interested parties, so this begs the question; can you register the name as a trademark? The matter was recently discussed in the IPEC this past summer.

The case of Mermeren Kombinat AD v Fox Marble Holdings Plc concerned marble quarried from the Sivec region in Macedonia, where these types of activities have been going on since Ancient Rome. Mermeren is a marble extraction company operating since the 1950s in Prilep, a region that includes Sivec. They registered the name SIVEC as a trademark in 2014 (EUTM 12057915), ultimately pursuing Fox Marble for trademark infringement for using the name SIVEC. Fox Marble also counterclaimed for invalidity of the trademark.

The matter focussed on whether the trademark was invalid under Article 7(1)(c) of the CTM Regulation, which sets out that marks consisting exclusively of "…or indications which may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods or of rendering of the service, or other characteristics of the goods or service" cannot be registered. Even with this focus the above Article is still subject to Article 7(3), where a mark can avoid Article 7(1)(c) if it has inherent distinctive character.

The Court then moved on to assessing whether the mark in question has inherent distinctive character. After an exhaustive review of case law relating to inherent distinctive character, Judge Hacon, presiding over the matter, set out the summarised eleven principles relevant when considering distinctiveness. While not discussed at length in the decision, they are still important to keep in mind when thinking about distinctiveness.

The judge started by looking at who the average consumer is. He did, however, first observe that the CJEU has not considered the meaning of a 'relevant class of persons' or what a 'significant proportion', which are an important part of this principle. Judge Hacon concluded that this would be "…a proportion markedly above de minimis but not necessarily over half" – a line that is difficult to draw when a majority isn't needed, so will heavily rely on the facts in each case.

Not all art materials are created equal

The judge first very quickly dealt with the question of the average consumer in the matter. Agreed by both parties, the average consumer is "…a specialist dealer in marble or a person who advises their customers on the choice of materials to be used in a building, such as an architect or designer of interiors", but this person would have to be from the EU and therefore not Macedonia.

The second matter was whether the mark had inherent distinctive character. Judge Hacon swiftly determined that the mark would not have inherent distinctive character denoting geographical origin due to the obscurity of the location it referred to. The average consumer wouldn't have heard of Sivec, unless you lived near the area, which eliminates the possibility of the name having inherent distinctiveness. Use of the name would have to be disregarded, as that relates to acquired distinctive character.

The Court then moved onto the matter of acquired distinctive character. Fox Marble argued three assumptions to support a non-finding of acquired distinctiveness: the trademark is inherently distinctive and therefore can be argued to not be distinctive through use; the average consumer would only see it as denoting a geographical origin, even without knowing the place exists; and that not enough people would perceive the goods to come from Mermeren.

The judge quickly dealt with the first two assumptions, with the former having been decided when no inherent distinctive character was found. The latter was accepted by the judge, as it is possible for the average consumer to perceive the origin of the goods through this assumption; however, their actual perception would differ from this when considering the mark's use in isolation from this assumption.

Finally, the judge considered the 'messy reality' of the relevant persons' belief as to the meaning of the mark. As discussed above, the judge highlighted that, although the mark has to be perceived by a significant portion of the relevant people, this can be a portion that is markedly above de minimis. Therefore, even if all people are not persuaded, the law can still consider the amount significant.

Judge Hacon then moved onto the extensive evidence on acquired distinctive character. He concluded that "…by August 2013 a significant proportion of relevant persons, certainly markedly above de minimis and probably higher than that, had come to believe that 'Sivec' was a trade mark owned by Mermeren, signifying that marble marked with that name came from a single undertaking" and had therefore acquired distinctiveness. The more influential evidence included invoices, presence at exhibitions and advertising campaigns launched by Mermeren.

The trademark had ultimately remained validly registered and had no grounds for revocation.

The case is not ground-breaking by any means (although clarified important parts of the law in acquired distinctiveness), but shows that, through a concerted effort to educate the population as to the origin of a trademark, even if a place on Earth, can lead to a successful registration and maintenance of a mark. Evidence was clearly key in the case, rather than complex legal arguments.

Source: IPKat

Pretty Cheesed - Will GIs Remain Protected in the UK After Brexit?

With the impending Brexit launch date looming in only two months, the repercussions of the UK's possible decision to leave the EU casts a shadow over nearly every aspect of the law in the country. While the nuances of its effects remain largely unclear at this moment, despite the government's white paper published earlier this month, and this leads to a wealth of speculation, even in the field of IP law. This writer recently came across the article below by the Guardian that discussed Brexit's impact on geographical indications (more on which here), and clearly, there could be some interesting issues presented should this not be resolved during the negotiations.

By way of exposition, Geographical Indicators (including PGIs and PDOs for the sake of simplicity) protect the specific origins or specifications of goods in the EU, allowing only those who comply with the specifications of a given GI to use the name in conjunction with their product (i.e. acting as a form of provenance of legitimacy). For example, Parmigiano Reggiano and Feta can only be used for cheeses that follow the specifications, i.e. have been produced in a particular region using particular milk. These are protected, among international treaties, under the GI Directive.

What remains interesting is that over 60 British products, such as Stilton blue cheese and the Cornish Pasty, will remain protected under EU law even after the UK's departure from the EU (as no membership is required); unless the Union will amend its laws or simply rescind protection for UK GIs.

Peter was unsure what to do with
all of his faux "parmesan" after Brexit

On the flip-side of this conundrum, all of the EU GIs would be free to be used in the UK, provided that the legislation that remains does not reflect the EU position as it was prior to Brexit. Even though individuals could make Birmingham "Champagne" or Newcastle "Parma Ham", the goods would not be allowed to enter the EU market (or those with reciprocal agreements with the EU, such as Canada under the Comprehensive Economic and Trade Agreement). Internal competition in the UK could lead to branding issues for GIs, but it seems unlikely that many domestic producers would willingly go against prior practice and laws.

An additional twist to the tale are the various conventions that the UK is party to, including the TRIPS Agreement and Madrid Agreement, would still remain in force, protecting GIs in the UK outside of EU legislation.

Although Brexit will present its challenges to the UK and EU economies, this writer doubts that GIs will be an issue, and that business will continue as usual, with protection being extended to GIs both in the UK and the EU. Reciprocal protection will most likely be extended to intellectual property rights in negotiations, or at least conversions, where needed, would be provided to those wishing to retain their rights, and equivalent legislation will nonetheless have to be introduced as a part of international obligations outside of the EU.

The hypothetical scenario of a lawless GI landscape in the UK is an entertaining one, but is very much a near impossibility should the UK want to remain relevant in the global market.

Source: The Guardian

Retrospective - Geographical Indicators and Trademarks

As many wine connoisseurs can clearly tell you, there is a vast amount of difference in the origin of a wine, be it from Southern France or Northern Italy, the specific region where the product is produced lends itself to create a nuanced flavor profile only achievable from that particular region. While this writer has no knowledge of such differences (he distinguishes his wines based on color), they illustrate a very important aspect of protection for some products and their geographical origins. Be it Feta cheese, Parmigiano Reggiano, or Scotch whisky, where the products come from is often as important, or at times more important, than the quality of the product, giving each item its 'signature' taste and feel. With this specific taste and feel (at least prima facie) comes a need for protection, lest we allow for the production and sale of Parma ham produced all over the world, clearly therefore not being from Parma at all, potentially deceiving the public as to its origins. That said, does the geographical origin of a product confer a protectable right, and if so, how wide-reaching is the right?

A decision seeking to answer this question was faced by the then-named House of Lords in the UK in the early part of the 21st century in Consorzio Del Prosciutto Di Parma v Asda Stores Limited and Others. The case concerned the packaging and sale of Parma ham, specifically by Asda (a large chain of UK supermarkets), which had been sliced and packaged in Wiltshere in the UK by Hygrade Foods Ltd. Although the ham had been produced in Parma and subsequently sent to Hygrade, the act of slicing and packaging the meat had occurred in the UK; something that went against the Italian law (accessible here in Italian) protecting Parma ham and its processing specifically, and the sale thereof. Upon identifying this the Parma Ham Association sued Asda and Hygrade for selling the ham.

The law relied upon by the Association is European in origin, specifically European Council Regulation No. 2081/92. Under the Regulation the European Commission can register a name, upon the satisfaction of criteria set out in Article 4 of the Regulation, as a "protected designation of origin" or a "protected geographical indication", which, as explained by the court, are: "...[a] PDO is the name of a place used to describe a product, originating in that place, with characteristics that are due to its particular environment. A PGI is similar to a PDO except that the causal link between the place of origin and the quality of the product may be a matter of reputation rather than verifiable fact". Parma ham was registered as a PDO in 1996. 

Clucky didn't care if it was from Parma or not

After some deliberation by Lord Justices Hoffamn and Scott, the Lords could not answer the question posed to them as to the direct enforceability of the Regulation within Member States' domestic courts, and therefore referred the question to the European Court of Justice for further deliberation: "As a matter of Community law, does [the Regulation]... read with Commission Regulation (EC) No 1107/96 and the specification for the PDO “Prosciutto di Parma” create a valid Community right, directly enforceable in the court of a Member State, to restrain the retail sale as “Parma ham” of sliced and packaged ham derived from hams duly exported from Parma in compliance with the conditions of the PDO but which have not been thereafter sliced, packaged and labelled in accordance with the specification?"

The decision of the ECJ was given two years later. The ECJ answered the House of Lords' question after long deliberation of the Regulations application to Member States, and whether a PDO can be enforced against economic operators, including its specification as to slicing and packaging:

"[the Regulation]... must be interpreted as not precluding the use of a protected designation of origin from being subject to the condition that operations such as the slicing and packaging of the product take place in the region of production, where such a condition is laid down in the specification. Where the use of the protected designation of origin ‘Prosciutto di Parma’ for ham marketed in slices is made subject to the condition that slicing and packaging operations be carried out in the region of production, this constitutes a measure having equivalent effect to a quantitative restriction on exports within the meaning of Article 29 EC, but may be regarded as justified, and hence compatible with that provision. However, the condition in question cannot be relied on against economic operators, as it was not brought to their attention by adequate publicity in Community legislation."

All in all the Regulation does create an enforceable right through a PDO, but only if the stipulations within it as to specific packaging, slicing or other measures, have to be expressly stated within the registered PDO. Geographical indicators, therefore, act very similarly to trademarks, and do offer an route of enforcement ensuring the quality of the goods themselves within the European Union. Geographical indicators are also protected outside of the EU through a variety of agreements between the EU and other nations, with the addition of agreements between World Trade Organization members. They are by no means an answer to a lack of a trademark, but offer an avenue through which distinct origins (and quality) can be protected, especially when its derived from tradition and strict rules on the above.

Retrospective - What is a Trademark?

Image and association through that image is a very powerful thing in the success of a product in addition to its sustainability as a strong brand. Trademarks have always aimed to protect that image, functioning as an indicator of certain qualities, value or consistency, giving the customer or client reassurance as to their expectations. Even though arguably self-explanatory or even obvious, what a trademark truly is is often left in the dark to the layman and even some legal practitioners. Trademarks encompass a wide array of possible marks which can be registered in the common law, yet they all share a common purpose in their registration and existence. This purpose was discussed under current EU, and subsequently applying to UK legislation, after the introduction of the EU's very first Directive dealing with trademarks.

The case in question was Canon v Metro-Goldwyn-Mayer, initially dealt with in the German Federal Court of Justice (Bundesgerichtshof) and then referred to the Court of Justice of the European Communities for further clarification in 1998. The case dealt with the mark "CANNON", which was applied for registration by MGM in Germany in relation to films recorded onto cassettes and their subsequent uses in distribution and production for example. MGM's application was then objected to by Canon under the old German Trademark Law (Warenzeichengesetz), arguing that their registered trademark "CANON" would be infringed should MGM be allowed to register the word "CANNON". Initially MGM's mark was rejected by the German Patent Office (Deutsches Patentamt) due to the marks being analogous; however a second examiner at the Patent Office dismissed the initial decision and rejected Canon's opposition for lack of similarity. The case was further appealed to the German Federal Patent Court (Bundespatentgericht), where the Court rejected Canon's appeal, deciding the two marks were not similar. The case was then ultimately brought to the aforementioned Federal Court of Justice, from where the case was brought to the European Court of Justice.

Tony proudly carried his badge

Under Directive 89/104/EEC the Union sought to unify the Member States' approaches to trademarks, under which the German laws were amended. The Directive also applies to the UK, which enacted the Trade Marks Act 1994 to bring their legislation in-line with the EU regulations. Relating to the case, the Federal Court of Justice referred this question to the European Court of Justice: "May account be taken, when assessing the similarity of the goods or services covered by the two marks, of the distinctive character, in particular the reputation, of the mark with earlier priority (on the date which determines the seniority of the later mark), so that, in particular, likelihood of confusion within the meaning of Article 4(1)(b) of Directive 89/104/EEC must be taken to exist even if the public attributes the goods and/or services to different places of origin?"

The question can be seen in simpler terms: would the judiciary have to take into account the reputation of an earlier existing mark (in this case CANON) when assessing the registerability of a newer mark (in this case CANNON), even if the public would understand the different origins of the two competing items bearing their respectable marks? What the European Court of Justice emphasized was the tenth recital of the Directive, which states that "...the function of [of a registered trademark]... is in particular to guarantee the trade mark as an indication of origin". This, in the Court's decision: "...enabl[es] [the consumer], without any possibility of confusion, to distinguish the product or service from others which have another origin", adding that "...it must offer a guarantee that all the goods or services bearing it have originated under the control of a single undertaking which is responsible for their quality". In the Court of Justice's decision, answering the German Federal Court, the earlier mark's reputation has to be taken into account and just the risk of confusion would mean that there is a likelihood of confusion even if the two products have two distinct origins.

A trademark therefore offers a guarantee of quality and origin to the consumer, and has to be protected as such to prevent any confusion to the consumer as to this fact; a badge of origin, as it is often referred to as. Should other marks be allowed to be registered the consumer could be confused, at a quick glance at least. This position has been fully accepted in the UK under the Trade Marks Act 1994, and even in Canada the Canadian Supreme Court in Kirkbi AG v Ritvik Holdings saw that a trademark is "...a symbol of a connection between a source of a product and the product itself"; creating a similar description to what the European Court of Justice did.

As one can clearly see, trademarks offer a unique type of protection and a specific function. The origin of a product or services can be the deciding factor between the consumer purchasing your product rather than the other, and enabling that consumer to fully understand what they are buying is imperative. Trademarks offer this guarantee, protecting both the consumer and the owner of the trademark, making them incredibly valuable to all parties involved.