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Wednesday, 2 March 2016

Of stripes, positions, and shoes: CJEU's decision in Adidas three-stripe case

Like literary topos in classic novels, the narrative of IP law has long-standing themes that arise in trade mark litigation time and again.  Shape and color of chocolate confectionery, jumping feline beasts of prey and the shape of soft drink bottles are just some recurring themes.  Another such theme is the position of stripes on footwear, in particular the long running  saga of the Adidas three-stripe trade mark.  

Back in 2008, the Court of Justice of the European Union (CJEU) first addressed that topic in Adidas Case C-102/07 [noted by the IPKat here]. The General Court (GC) followed suit, with two more rulings addressing a five-parallel-stripe sign adorning a shoe surprisingly similar to this Kat's favourite childhood model, referred to as the Original Superstars [see the IPKat notes here and here]

Three weeks ago, the CJEU issued its decision in Shoe Branding Europe BVBA v Adidas and OHIM [Case C396/15 P]. This time the parallel stripes were two, both impressed on a shoe curiously similar to an Adidas Dragon modelOver to Imogen Fowler and Iza Junkar (Hogan Lovells - who acted for Adidas) to finish the story:  

"By way of reasoned Order of 17 February 2016, the CJEU confirmed the decision of the General Court upholding Adidas' opposition against Shoe Branding's Community Trade Mark application for a 2-stripes mark positioned on a shoe. In July 2009 Shoe Branding filed a CTM application for the following position mark for footwear in class 25:



Adidas opposed on the basis of a number of its prior rights to the 3-stripe mark protected for identical goods, including the below CTM:

The opposition was dismissed by OHIM's Opposition Division and by the Board of Appeal, which held, in essence, that Adidas’ 3-stripe mark was so banal that it could enjoy protection only against identical, or virtually identical, reproductions. In particular, the Board held that the differences in the details in the positioning (i.e.  the instep area versus the area between the laces and sole), sloping (i.e. inclination) and the number of stripes, were sufficient to dispel any likelihood of confusion. Applying the same similarity test, the Board of Appeal also held that these dissimilarities were sufficient to dispel a risk of a link being made between the marks.  Therefore, the application could not take unfair advantage or be otherwise detrimental to the distinctive character or repute of Adidas' 3-stripes mark.

While the Board acknowledged that the 3-stripes mark had been extensively used and therefore had enhanced distinctiveness, it limited the recognition of such acquired distinctiveness to exactly the way that the 3 stripes were applied in a specific position on footwear. In contrast with some national case law, both as regards registrability and infringement, the Board disregarded extensive survey evidence adduced by Adidas, including evidence showing likelihood of confusion and association with Adidas in relation to similar configurations of 2 versus 3 stripes marks.

Adidas Dragon
Adidas appealed to the General Court [Case T-145/14], which overruled OHIM's decisions, and found that: 

"the difference in length of the stripes arising from their difference in inclination [are] minor differences between the marks at issue [that] will not be noticed by the consumer with an average degree of attention and will not influence the overall impression those marks produce on account of the presence of wide sloping stripes on the outside of the shoe"

Further, the General Court noted that the Board did not explain why all the other clear elements of similarity between the marks, such as the shape, size and colour of the stripes and their positioning on the outside of a shoe were not relevant. After carrying out a global assessment of the signs and taking into account the elements which were clearly common to the marks at issue, the General Court held that the Board was wrong to say the marks were dissimilar. The Court also confirmed that the Board’s erroneous assessment regarding the similarity of the signs influenced its decision under Article 8(5) and therefore also had to be annulled.

Who says inclination is a minor element?
Shoe Branding appealed to the CJEU, which turned it down on all the grounds upholding the General Court's reasoning both as regards the nature of "minor differences" of elements such as the length of the stripes, their different inclination, and their number.  The CJEU concluded that the GC correctly conducted an overall assessment of the signs at stake by holding that

"the difference between two and three stripes placed on a shoe [is] not sufficient to affect the similarities arising from the configuration of the signs at issue and from their position on the side of the shoe [so that] that difference [does] not influence the overall impression produced".



This case appears to put a nail on the coffin of applicants trying to hide behind minor variations in stripes, such as an addition or omission of a single stripe to avoid legal scrutiny. It also brings EU case-law closer to the approach that has been taken by national courts in trade mark infringement cases involving Adidas' three-stripes mark [see generally here; Adidas v Alcampo S.A. (Spain), here; Adidas AG v. Almacenes Kaymo (Spain), here; H&M v. Adidas (The Netherlands), noted by the IPKat here]. Be that as it may, the wind seems to have changed also at OHIM, where Adidas succeeded (on appeal) in its recent opposition against an application for the very same sign by Shoe Branding, claiming protection for "protective footwear", with the Board of Appeal following the guidance of the General Court outlined above [Case R-3106/2014-2, currently on the table of the General Court]. This case may also help demonstrate to other brand owners that non-traditional trademarks can be effective tools to use against those who wish to copy their trade dress in the EU".

5 comments:

Anonymous said...

Give any teenager a pair of trainers with two stripes facing the "wrong" way and try to get them to accept they are Adidas shoes and they will probably just laugh. So in my humble opinion they go nowhere near wrongly indicating Adidas as the source of the shoes, which I was always taught was the main point of TMs? Possibly gives similar overall design impression though maybe if strip out question of identifying the source of the goods?
Just my opinion.

Glad to be out of the madhouse said...

Anonymous@12:26 The teenager may not be fooled, but many well-meaning older relatives buying those trainers as a gift may well be. I have quite a few sad memories from my younger years of receiving obvious knockoffs of very inferior quality (but not necessarily much cheaper price) from easily misled relatives. Indeed, a walk through certain types of stores will reveal you that there is a thriving industry that specialises in the "clueless granny" market, from toys through faux-Disney DVDs to clothing.

Niall Tierney said...

The CJEU's ruling reminds me of the Passing off decision of the Irish Supreme Court in Adidas Sportschuhfabriken Adi Dassler K.G v Charles O'Neill [1983] F.S.R 76 where O'Higgins C.J quoted with approval a passage from Kerly:

"There can hardly be passing-off by get up alone (in the usual sense of substitution of one make of a product for another) unless the resemblance between the goods is extremely close, so close that it can hardly occur except by deliberate imitation; and even that may not be enough".

Of course the CJEU did not have to address Passing off when issuing its ruling. Had this just been a case of Passing off, I wonder how successful Adidas would have been.

Anonymous said...

This decision is so divorced from commercial and practical reality as to be entirely ridiculous. The CJEU may as well just provide Adidas with a monopoly on any and all items of striped clothing or footwear. Does anybody seriously believe that the relevant consumer will be confused between the two shoes? If we are, we must surely accept that a consumer who is confused by two (rather than three) stripes on a shoe when those stripes are both in a different position and in a different orientation would be equally likely to be confused by one stripe or seventy-two stripes regardless of positioning or orientation, after all they will probably just know that Adidas products are striped. That means anybody making any striped shoe of any type or appearance now infringes Adidas's registration for the reason that we wouldn't want this extremely moronic consumer to ever be put at any risk of being slightly confused.

Decisions like this make me despair that the trade mark system is being run purely for the benefit of large businesses to the detriment of SMEs and consumers everywhere. There is no way in which Adidas having a monopoly on striped shoes can be of any benefit to anybody other than Adidas... even the moronic consumer is being deprived of the chance to learn that different brands produce different products that look different.

Anonymous said...

The two shoes might just be confusing if one of them was not Adidas. But anyone who does not know that three stripes = Adidas is on a different planet (Reebok?)

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