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Thursday, 16 April 2015

Dior trade mark registration: are you being Sirous?

Spotting a fascinating spat between the proprietor of a well-known name and the owner of an extremely unusual one, occasional guest blogger Kevin Winters has composed the following item for the edification of readers of this weblog. Kevin has done some guest blogging on Art & Artifice in recent times (here and here) as well as an earlier Katpost on US patent law reform (here). This is his first piece in the field of trade marks:

Christian Dior
The New Zealand Herald recently reported that Parisian fashion house Christian Dior is taking action against a New Zealand photographer looking to register his personal and business names as trade marks. Mr Sirous Dior founded his photography company, Dior Fine Art, in New Zealand in 2014. He submitted applications in September 2014 to the Intellectual Property Office of New Zealand (IPONZ) for registration of two trade marks: ‘Sirous Dior’ and ‘Dior Fine Art’. Having been alerted to the applications, Christian Dior, via their lawyers, wrote to Mr Dior, asking him to withdraw them within 14 days lest they challenge the registration and begin legal proceedings.

Sirous Dior
According to the report, IPONZ had already examined and accepted the ‘Sirous Dior’ trade mark, which is now under opposition, while the ‘Dior Fine Art’ mark is currently undergoing examination. The situation presents an interesting question: how is the opposition likely to be handled? The obvious argument by Christian Dior will be based on the concern that the ‘Sirous Dior’ mark will infringe the trade marks it currently holds in New Zealand: that the registration and use of the ‘Sirous Dior’ trade mark would be detrimental to the Dior brand.

New Zealand’s Trade Marks Act 2002 states at section 89(1)(d) that
“A person infringes a registered trade mark if the person does not have the right to use the registered trade mark and uses in the course of trade a sign identical with or similar to the registered trade mark in relation to any goods or services that are not similar to the goods or services in respect of which the trade mark is registered where the trade mark is well known in New Zealand and the use of the sign takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the mark.”
A trade mark will only be entitled to protection against dilution under the Act where it is ‘well-known’. Since there is no definition for this term, it will be for the trade mark owner to demonstrate this as a matter of fact. It is suggested that it would not be too difficult for Christian Dior to demonstrate how ‘well known’ its brand is, not least because of the firm having two boutique stores in Auckland alone.

It would appear, therefore, that Mr Dior’s chances at successfully using his own name for his business, and enjoying its legal protection depends on successfully relying on the own name defence to a claim of infringement available under section 95(a) of the 2002 Act, where
“A person does not infringe a registered trade mark if, in accordance with honest practices in industrial or commercial matters, the person uses the person’s name or the person’s place of business.”
There may then be hope for the ‘Sirous Dior’ trade mark. There is no evidence to suspect that Mr Dior is lying about his name. Indeed, news reports suggest that Mr Dior changed from his mother’s surname, Badiei, to his father’s, Dior, 15 years ago. The difficulty however is that the 2002 Act is silent as to the meaning of the term ‘honest practices’ under the own name defence. Due attention should be given to the Practice Guidelines of the IPONZ on this point. Section 1.1 provides that UK and European cases which considered questions on wording that is similar to, or the same as that in the 2002 Act will be of some relevance to the NZ legal regime.

The situation under EU law is instructive. Article 6(1) of Directive 2008/95 (the Trade Mark Directive) states that:
“The trade mark shall not entitle the proprietor to prohibit a third party from using, in the course of trade: (a) his own name or address provided he uses them in accordance with honest practices in industrial or commercial matters."
There has been slightly more clarity regarding the use of the own name defence in the European context. In Case C-100/02 Gerolsteiner Brunnen GmbH & Co v Putsch GmbH the Court of Justice of the European Union (CJEU) held:
“The mere fact that there exists a likelihood of … confusion …is… insufficient to conclude that the use of that indication in the course of trade is not in accordance with honest practices.”
Further, in Case C-17/06 Céline Sarl v Céline SA the CJEU elaborated on what must be determined in assessing ‘honest use’ under the ‘own name’ defence:
“…account must be taken first of the extent to which the use of its name is understood by the relevant public, or at least a significant section of that public, as indicating a link between its goods or services and … a person authorised to use the trade mark, and secondly of the extent to which [they] ought to have been aware of that. Another factor to be taken into account when making the assessment is whether the trade mark concerned enjoys a certain reputation in the Member State in which it is registered and its protection is sought, from which a third party might profit in marketing his goods or services.”
The CJEU in Case C-228/03 Gillette Co v LA-Laboratories Ltd Oy made clear that the condition of ‘honest use’:
“…was in substance the expression of a duty to act fairly in relation to the legitimate interests of the trade mark owner.”
The Court then ruled, in dealing with “honest practices in industrial or commercial matters” that a trader will be compliant where
“…if by using a third party's trade mark it does not create the impression that there is a commercial connection between itself and the trade mark proprietor and does not take unfair advantage of the trade mark's distinctive character or repute. The fact that a trader also sells those products and places the third party's trade mark on them does not necessarily mean that it represents that its products are equal in quality to those of the trade mark proprietor. The trader's conduct must therefore be considered on the basis of a global assessment of all the relevant factors.”
One can appreciate the commercial reasons for the house of Dior’s opposition to the ‘Sirous Dior’ trade mark. However, whether these reasons are enough to win a legal battle is something quite different. This is not the first, nor is it likely to be the last time, that fashion houses have opposed the registration of trade marks that concern their brand names: both Chanel and Gucci have aggressively protected their trade marks in respect of their brand names in the past.

Striking a balance ...
The jurisprudence of the CJEU is rich, and could be immensely helpful to the New Zealand courts, if this matter cannot be settled without litigation. This is yet another example of when balance must be struck between affording the necessary protection to businesses that have invested substantial time and effort in developing and protecting a brand, and not stifling innovation and preventing entrepreneurs from developing their own presence in the commercial world.


Craig Welch said...

"One can appreciate the commercial reasons for the house of Dior’s opposition to the ‘Sirous Dior’ trade mark".

Can one? I can't. The mere fact that the name 'Dior' is used will not lead to confusion. This case is a typical example of companies over-thinking and over-reaching their brand protection strategies. The Olympic Committee is of course the world's worst, and we do not normally see Dior as such a villain. But there is no reason why Dior should not leave Mr Dior alone to go about his (non-competing) business.

James Wagner said...

Craig, I agree that when large companies aggressively police 'their' marks it can cause damage to their reputation and often doesn't make a business case for anyone but the litigators.

However, I see a significant difference between letting someone go about their non-competing business; and applying to oppose a potentially confusing or diluting trademark application which would grant that someone an exclusive right that could in turn be used against you or interfere with your expansion plans in the future.

Once registered, that trademark application that you might be willing to overlook now, could potentially be assigned to any third party, including a competitor of yours who may not have non benign intentions, and significantly greater distribution means and advertising budgets.

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