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Wednesday, 22 November 2017

Lost their marbles? When can you register a geographical name as a trade mark? Mermeren v Fox

Marble can cause all kinds of dispute
photo credit: Sean Hickin
"Since the time of the Roman empire marble has been extracted from quarries near the city now called Prilep, in the Balkan peninsula. The marble was and is famed for its white colour and homogenous appearance which have made it a marble suitable for statuary, for use in the Emperor Diocletian's palace and more recently in the Grand Mosque in Abu Dhabi and in upmarket bathrooms."  And so, begins Mermeren v Fox Marble [2017] EWHC 1408 a (relatively) recent IPEC decision about trade marks and geographical names.

The Claimant, Mermeren, is a Macedonian company which has been extracting marble from the Prilep area since 1950 and owns the EU mark SIVEC for "marble of all types" and other things.  Sivec is also the name of a mountain pass in the Prilep region of Macedonia, a popular location for extracting marble. 

Fox Marble is a UK company which extracts and sells marble and has been selling that marble under the sign 'Sivec'.  When Mermeren alleged infringement of its EU mark, Fox argued, amongst other things, that it was justified in using the sign because 'Sivec' indicated the geographical origin of the marble to people working in the marble trade.  Therefore, Fox said it had both a defence to infringement and grounds for invalidating the mark (under Art.7(1)(c) of the Regulation).  Mermeren countered that to the extent this was true, the mark had acquired distinctiveness.

What is the test?

HHJ Hacon noted that it was hard to reconcile the principles from Windsurfing Chiemsee (which covers both immediate perception and potential future perception) with Spear v Zynga, Technopol and Doublemint (where the court required immediate perception by the average consumer that the mark designates a geographical origin). 

In Hacon's view in most circumstances, the effect of use of a trade mark must be ignored when assessing the prohibitions to its registration under art.7(1)(b), (c) and (d).

But does the average consumer like playing with marbles?
Who is the average consumer?

It was agreed that "the average consumer was 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." Because the average consumer came from within the EU, this excluded Macedonians (i.e. the people who are most likely to connect the word Sivec with a geographical location because that is where the mountain pass is located).

Inherent character of the Trade Mark under art.7(1)(c)

The judge concluded that Fox had to show that the Trade Mark inherently denoted a geographical origin to the average consumer.  Because Sivec "is a very obscure place".  The few people that may have heard of it (i.e. people who live near the mountain pass) are not the average consumer and not located in the EU.  As HHJ Hacon put it:
"This was fatal to Fox's case under this head. If the average consumer has never heard of a place the name of that place cannot inherently designate a geographical origin in the mind of the average consumer. The only possible way such a designation could have arisen for the average consumer was by use of the name in the EU, which must be disregarded." 
Acquired distinctiveness

Even if the mark was invalid under Article 7(1)(c), Mermeren could still have a valid mark if it could establish that SIVEC had acquired distinctiveness through use on the filing date. The more famous a geographical name, the higher the threshold for establishing acquired distinctiveness (i.e. long-standing and intensive use is required).  As Sivec is "very obscure" the threshold was correspondingly lower.

After a review of the various authorities, HHJ Hacon summarised the position regarding acquired distinctiveness as follows (with emphasis added):
(1) The overall criterion which governs whether a trade mark has acquired distinctive character is whether the average consumer perceived that trade mark identified the relevant goods or services as originating from a single undertaking. (The average consumer, as ever, is reasonably well-informed, reasonably observant and circumspect.) 
(2) This perception is to be assessed as of the date of filing the application for registration of the trade mark. 
(3) The perception of the average consumer in (1) is to be distinguished from the circumstance in which the average consumer recognised the mark and associated it with the applicant's goods; such recognition and association is not of itself sufficient to confer distinctive character on a trade mark. 
(4) The average consumer will be taken to have perceived that the trade mark identified the goods or services as originating from a single undertaking if at least a significant proportion of the relevant class of persons had that perception. 
(5) Such a perception must have arisen in consequence of the use of the mark as a trade mark. That will be more easily established if the proprietor explicitly promoted it as a trade mark. 
(6) When making its assessment of the distinctive character of a trade mark, the tribunal may take the following into account: (i) the market share held by the mark; (ii) how intensive, geographically widespread and long-standing use of the mark has been; (iii) the amount invested by the undertaking in promoting the mark; (iv) the proportion of the relevant class of persons who, because of the mark, identify goods as originating from a particular undertaking; and (v) statements from chambers of commerce and industry or other trade and professional associations. 
(7) If the tribunal is in difficulty in making that assessment, as a matter EU law it may have recourse to a public survey, subject to national rules. 
(8) It is legitimate for a tribunal to consider whether a significant proportion of the relevant class of persons would have relied on the sign as denoting the origin of the goods or services. Such reliance is not a precondition for establishing the distinctive character of a trade mark, but if established it is sufficient to show that the mark has distinctive character
(9) In relation to a trade mark consisting of a geographical name, regard must be given to the specific nature of the name. Where the name was very well known, it could have acquired distinctive character only if there had been long-standing and intensive use of the mark by the proprietor. A fortiori, where a name was already familiar as an indication of geographical origin in relation to the relevant category of goods, the proprietor must show that the use of the mark – both long-standing and intensive – was particularly well established. 
(10) Distinctive character must be established in the part of the EU in which it initially had descriptive character for the purposes of Article 7(1)(c)

In practice this meant that the mark had "distinctive character if a significant proportion of the relevant class of persons perceives goods designated by the mark as originating from a single undertaking".  A "significant proportion" is "markedly greater than de minimis but not necessarily over half".

How does the average consumer perceive Sivec?

The perception of whether Sivec was a real place mattered for acquired distinctiveness, not the "messy reality".  The judge found that "as of August 2013 use of the Trade Mark by Mermeren had led some relevant persons in the real world to think that it meant the place from which the marble was quarried; others had moved on to think that it meant marble quarried and/or supplied by Mermeren. There was probably a third group of relevant persons who gave the matter no thought beyond 'Sivec' being a type of marble."

Following a review of the documentary evidence and, to a lesser extent, witness testimony, the judge concluded that in August 2013 at least a significant proportion of relevant persons perceived that the Trade Mark, when used in relation to marble, identified it as originating from a Mermeren.

Because the average consumer did not perceive Sivec as indicating geographic origin, the trade mark was found to have been validly registered.

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