ECJ SPRINGS INTO ACTION ON TRADE MARK DEFENCES

Gerolsteiner is the proprietor of the German trade mark GERRI for various non-alcoholic beverages. Putsch markets soft drinks in Germany bearing labels including the words KERRY Spring because the drinks are manufactured in Ireland by a company called Kerry Spring Water and contain water from a spring called Kerry Spring. Gerolsteiner brought infringement proceedings in Germany. The case eventually reached the Bundesgerichtshof, which found that there was a likelihood of aural confusion between the two indicia for the purposes of Article 5(1)(b).

The Bundesgerichtshof sought the ECJ’s advice over whether Article 6(1)(b) could apply in those circumstances, asking:

1. Is Article 6(1)(b) of the First Trade Mark Directive also applicable if a third party uses the indications referred to therein as a trade mark (markenmässig)?
2. If so, must that use as a trade mark be taken into account when considering, pursuant to the final clause of Article 6(1) of the First Trade Mark Directive, whether use has been in accordance with honest practices in industrial or commercial matters?

The ECJ answered the referred questions in a way that maximises the scope of the Article 6(1) defence:

♦ Article 6(1)(b) draws no distinction between the possible uses of the indications referred to in Article 6(1)(b). Instead, the defendant’s use will fall within the scope of the defence if his indication concerns one of the characteristics enumerated in the article as long as the use is in accordance with honest practices in industrial or commercial matters. That the use must be in accordance with honest practices in industrial or commercial matters is the only requirement. This constitutes in substance the expression of a duty to act fairly in relation to the legitimate interests of the trade mark owner.
♦ The mere fact that there is a likelihood of aural confusion between the earlier registered mark and the indication of geographical origin from another Member State does not mean that the defendant’s use of the indication in the course of trade is not in accordance with honest practices. Because of the diversity of languages within the EU, there is a high likelihood that there will be some phonetic overlap between marks in some countries and indicators of geographical origin in others.
♦ It is for the national court to carry out an overall assessment of the circumstances of any particular case to establish whether the use is honest. Here for example, it would be for the court to look in particular at the shape and labelling of the bottle to assess whether the defendant was unfairly competing with the claimant.

The IPKat notes that once again the ECJ has avoided using the term “trade mark use”. By allowing defendants to make honest use even where there is confusion, the court has placed the interest of free movement before consumer protection. It remains unclear what honest practices means, though there are hints in this case that it may be an objective standard, since the court referred to the fact that similarities between marks and geographical indicators could be coincidences and spoke about unfair competition.

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