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The Claimants - ISMS - are members of Auchan, the large international food retail and distribution group and operator of the SIMPLY MARKET stores in France and other European countries. There are currently over 2,000 Simply Market stores in Europe, owned and operated by the Claimants or one of their franchise partners.
The Claimants were the registered proprietors of European Union Trade Mark No 4712196 - SIMPLY MARKET - for various food and drink goods in classes 29, 30 and 35, and European Union Trade Mark No 5 410 998 SIMPLY for retail services of food products in class 35.
The sign used by the Claimants in France was as follows:
Marks & Spencer, since returning to the French high street in 2011, had been selling a range of goods which were branded with the M&aS name as follows:
In September 2014, the Claimants brought proceedings against M&S for infringement of both EUTMs under Article 9(1)(b) of Council Regulation (EC) 207/2009, and for unfair competition, relating to use of the above-mentioned sign.
M&S responded that there was no likelihood of confusion, and counterclaimed for invalidity of both trade marks, and requested that both trade marks be revoked for lack of use.
Scope of Counterclaim
The first point the court, comprising a panel of three judges, had to decide was whether M&S was entitled to request the cancellation of all goods and services of the cited registrations, or just those on which the infringement claim was based. After substantial reasoning on this point, it decided that this was a question of purely national law. According to the French IP code, M&S was not entitled to demand the cancellation of those goods and services not cited against it by ISMS, and therefore the claims for cancellation should be accepted as far as they apply to those goods and services cited in the infringement claim but rejected for those not so cited.
On the validity of CTM 5410998 SIMPLY
Recognizing the need to consider the validity of the marks by reference to the average consumer in all EU member states, the court referred to the decision of Liz Earle Co v OHIM, which held that English was understood in Scandinavia and Holland as well as Ireland, Malta and the UK. In France, the average consumer could be considered to have a 'baccalaureat' or high school/A-Level level of English. Consequently the term Simply would be directly understood by the average consumer in France. They further held that:
- 'Simply' could be an adverb or have a laudatory function.
- The fact that a word is complimentary or laudatory term does not necessarily mean it is devoid of distinctive character as long as it is capable of indicating commercial origin.
- That being said, the average consumer, faced with the ordinary term simply, would immediately understand that he might benefit from services simply offered or executed and would not be concerned by rules of grammar, which are often ignored in advertising and promotional materials, and would perceive the sign as being exclusively a description of a quality of the services and not an indication of commercial origin.
- Therefore the registered sign SIMPLY is not inherently distinctive and should be cancelled for the services: "Retail services of food products" in class 35.
On the validity of CTM 4712176 SIMPLY MARKET
The court held that:
- The sign is composed of the term SIMPLY (as discussed above), and the term MARKET, which is translated as and defined by the French term marché, meaning a physical or virtual space for the exchange of goods or services. The relevant public would interpret this as a particularly ordinary term.
- The association of the two terms gives the trade mark a more precise and easily understood meaning than either in isolation, regardless of any questions of incorrect grammar, and allows the public to immediately understand it as meaning a supermarket organized simply or whose products have a price or quality that is strictly that of a market in the traditional sense.
- The sign, although not descriptive of the products themselves, is descriptive of the means of their commercialization and composed of banal terms implying an alternative to normal structures of supermarkets. The sign would be immediately and exclusively perceived by the relevant public as having a solely promotional function, not capable of indicating the origin of the products for which it is registered.
- Therefore the registered sign SIMPLY MARKET is not inherently distinctive and should be cancelled for the relevant goods.
On the other claims
Following its decision on the validity of the two trade marks for the goods and services cited in the infringement claim, the court found that it did not need to consider the counterclaim for revocation for non-use or the infringement claim.
However, the court did considered the similarity of the sign used by M&S and that used by the Claimants in the context of the unfair competition claim. Noting the differences between the signs, the court noted that the products are sold in shops under the sign Marks and Spencer or on the dedicated M&S website. The consumer knows that M&S is a contraction of the brand name of the premises in which he has entered, or the domain name of the site he is visiting. He perceives M&S as the sign denoting commercial origin and simply, which has been established as being perceived as having a promotional message, as being merely descriptive of a quality of the products. Any confusion between the second claimant's brand name, which has a different colour and font, or the commercial name or domain name of the claimants is even more difficult to see in light of the message at the bottom of the M&S product, in English words which are particularly easy to understand by the French public, as having the quality of the undertaking who offers them for sale "M&S Quality", despite being at a low price "Simply Priced".
The Claimant have just decided to appeal the decision."The French decision can be found here.
The English translation of the decision can be found here.