Scope of review by the General Court of decisions by the EUIPO Board of Appeal: the last act in LAGUIOLE

Former Guest Kat Valentina Torelli has kindly provided IPKat with a report of notable decision recently given by the CJEU regarding the scope of judicial review.

"The scope of review of a decision given by the appropriate trademark authority is one of those seemingly colourless issues that potentially can have significant consequences. A recent example is the 5 April 2017 judgment given by the Court of Justice of the European Union (CJEU) in case C-598/14P (LAGUIOLE). Here, the CJEU set out important guidelines regarding the General Court’s (GC) powers of review of decisions issued by the EUIPO Board of Appeal pursuant to Article 65 Regulation 207/2009 (EUTMR).

As the CJEU stated at paragraph 44 of the judgement at issue, it is settled case law that:

"[…] first, the General Court must, in principle, confine itself to finding the decision that the Board of Appeal of EUIPO should have reached on the basis of the particulars underlying the Board of Appeal’s decision, second, the General Court may annul or alter a decision against which an action has been brought only if, at the date on which that decision was adopted, it was vitiated by one of those grounds for annulment or alteration referred to in Article 65(2) of Regulation No 207/2009, and, third, it may not annul or alter that decision on grounds which come into existence subsequent to its adoption."

Notwithstanding, the CJEU confirmed that the GC, in rendering its decision, must apply rules of national law as interpreted by national courts [paragraph 42 of the CJEU's judgement], where Article 8(4) EUTMR is invoked as a legal ground in proceedings before the EUIPO. This means that the scope of protection of national law may also be at issue.

In an action for a declaration of invalidity, based on relative grounds, where a national prior national right is the grounds, such person must provide the EUIPO with the particulars of the national law conferring protection against a junior mark. The same also applies in opposition proceedings based on Article 8(4) EUTMR. Thus, for verifying whether the content, conditions of application and scope of protection of a national law have all been interpreted correctly by the Board of Appeal, the GC may also rely on national judgements that postdate the date of the decision by the Board of Appeal.

This holds true, said the CJEU at paragraphs 43 and 45 of its judgement, even though it is possible that the GC may assess the national law differently from the Board of Appeal in light of the later case law. This is subject to the parties having been given the right to be heard on the new case law, if it is presented for the first time before the GC.

This is precisely what occurred in case T-453/11, Szajner v OHMI - Forge de Laguiole (LAGUIOLE) [reported by The IPKat here]. Here, the GC assessed the lawfulness of the decision of the Board of Appeal in light of the case law, as construed by the French Supreme Court in its judgment of 10 July 2012, ‘coeur de princesse’, delivered after the Board of Appeal's contested decision. That judgement constituted the last word on the longstanding and ongoing debate in France regarding the scope of protection of an earlier business name against an identical or confusingly similar junior mark. The judgment in coeur de princesse limited the legal protection of business names to the business activities actually pursued by a company.

In so doing, it declined to recognize a rule whereby such a business name can prevail over a later mark based on the literal wording of the objects of a company. These circumstances directly affect the interpretation and the application of Articles 711-4 and 714-3 of the French Intellectual Property Code (IPC), which allows for the invalidity of a later mark if it creates a likelihood of confusion with an earlier business name. These were the legal provisions on which the opponent relied in seeking a declaration of invalidity of the EUTM LAGUIOLE under Article 53(2) EUTMR and 8(4) EUTMR.

Although the judgment in coeur de princesse was issued later in time than the Board of Appeal's decision under examination and it involved a different legal action  [an action for invalidity on the ground of fraud, in the one, and a claim for unfair competition, in the other], the GC overturned the decision of the Board of Appeal on the basis of its interpretation of French law.

As the CJEU stated at paragraph 43 of the judgement, a decision based on an incorrect interpretation of national law cannot prevent that error from being corrected [although it is difficult to understand exactly where the Board of Appeal made a mistake in respect of the case law construed in coeur de princesse, inasmuch as when it rendered its decision, the judgment of the French Supreme Court had not yet been given. This is especially true if it is assumed that the EUIPO applies national law as a matter of fact and it does not rely on the principle of iura novit curia, see commentary here].

That said, the position taken by the CJEU may be understood in light of the ultimate purpose of the review by the GC of the decisions of the Board of Appeal. The review of the GC must guarantee that effective judicial protection is afforded trade mark holders and that the application of the EUTMR has practical consequences. This would not be the case if a EU trade mark was declared null and void according to Article 8(4) on the basis of a national case law which is (or seems not to be) no longer applicable in the relevant EU Member State.

However, it seems that the interpretation and application of the judgment of coeur de princesse in 'LAGUIOLE' may itself have an effect on shaping the scope of protection of business names under French law, providing general guidelines beyond the legal context in which the coeur de princesse judgement was issued [although it may well be for the French Court to decide whether coeur de princesse should apply only to similar cases, or rather to any controversy involving the scope of protection of business names in France, including cancellation actions based on relative grounds for refusal].

Kat readers are warned: it is advisable to follow developments of the national case law when relying on prior national rights in a proceeding under Article 8(4) EUTMR."