EUIPO Grand Board of Appeal invalidates ‘LA IRLANDESA’ EUTM on deceptiveness and bad faith grounds

In an important decision concerning a declaration of invalidity, the EUIPO Grand Board of Appeal held that the figurative mark depicted below was deceptive and had been filed in bad faith within the meaning of Articles 7(1)(g) and 59(1)(b) of the EU Trade Mark Regulation (EUTMR):

The case is relevant since the Grand Board – in establishing bad faith – considered several objective circumstances and provided guidance for future cases. In this case, the deceptiveness of the mark and the business relationship with one of the invalidity applicants were key.

Background

In January 2014, Hijos de Moisés Rodríguez González S.A successfully registered the above mark for goods in Class 29 (meat, fish, poultry and game, meat extracts, preserved, frozen, dried and cooked fruits and vegetables, jellies, jams, compotes, eggs, milk and milk products, edible oils and fats) of the Nice Classification.

In 2015, the Irish Ministry for Jobs, Enterprise and the Irish Dairy Board jointly filed a request for a declaration of invalidity, submitting that the trade mark was deceptive and had been filed in bad faith.

The applicants argued that the mark deceptively suggests that the goods covered by it would originate from Ireland. In particular (1) the combination of the word element ‘LA IRLANDESA’ (meaning ‘the Irish woman’ or ‘Irish’ (feminine)), (2) the Celtic symbolism of the knot device, and (3) the colours used, which evoke Ireland’s national colours and flag, all unduly suggest that the products would have an Irish origin.

Furthermore, the EUTM proprietor previously had a commercial relationship with the Irish Dairy Board. This would suggest a dishonest intention on its side at the time of filing the contested mark. Also, the EUTM owner had previously attempted to register “LA IRLANDESA” as a trade mark in Spain. Despite the Spanish Trade Mark Office’s refusal, the EUTM proprietor nonetheless obtained successful registration of a series of four new marks incorporating the words ‘LA IRLANDESA’, including the contested mark.

The earlier stages

The Cancellation Division rejected the request for invalidity in its entirety.

In relation to deceptiveness, it reasoned that - for a mark to be invalidated in accordance with Article 7(1)(g) EUTMR - it must contain an objective indication of characteristics which are clearly in contrast with the goods claimed in the specification. Since Irish products were sold under ‘LA IRLANDESA’, such honest use could also be presumed.

In relation to bad faith, the Cancellation Division reasoned that, whilst previous filings sometimes shed light on the trade mark applicant’s intention, previous national decisions are not binding.

In December 2017, the Presidium of the Boards of Appeals considered it appropriate to refer the case directly to the Grand Board of Appeal in order to establish a harmonized approach also for similar cases.

The Grand Board’s considerations

Deceptiveness

According to Article 7(1)(g) EUTMR, a trade mark shall be refused/declared invalid where it has been registered despite being of such a nature as to deceive the public as to the geographical origin of the goods.

The circumstances for refusing/invalidating registration presuppose the existence of actual deceit or a sufficiently serious risk that consumers will be deceived. Once the latter has been established, it becomes irrelevant that the mark applied for might be also perceived in a way that is not misleading.

The mark at issue is a figurative sign, consisting of the term ‘LA IRLANDESA’. That term is also the principal and dominant element of the sign and since the words contained in the mark are Spanish, the relevant public consists of Spanish-speaking consumers to whom the relevant goods are directed. The colour green will underline the perception to the public that the goods bearing the mark are of Irish origin supported by the fact that the goods can also be produced in Ireland.

The Grand Board therefore reasoned that Spanish-speaking consumers will establish at once a direct connection between the meaning of ‘LA IRLANDESA’ and a quality of these goods, namely, their geographic origin. These consumers will thus believe that the goods are from Ireland.

With support of the evidence submitted by the invalidity applicants it was shown that the EUTM proprietor had used the ‘LA IRLANDESA’ mark on goods which did not originate from Ireland.

Bad faith

To establish bad faith, the invalidity applicant has to demonstrate the circumstances that make it possible to conclude that the proprietor of an EUTM was acting in bad faith at the time of filing.

Following the criteria established in the Lindt case, consideration must be taken of: (a) the origin of the contested sign and its use since its creation; (b) the commercial logic underlying the filing of the application for registration of the sign as an EUTM; and (c) the chronology of events leading up to that filing (T-257/11, COLOURBLIND).

As regard to the EUTM proprietor’s intention, this has to be determined by reference to the objective circumstances at hand (T-23/16, FORMATA). Such intention may be inferred from, eg:

• The EUTM proprietor’s specific actions before the filing of the contested mark,
• Contractual, pre-contractual or post-contractual relationship between the parties,
• The existence of reciprocal duties or obligations, including the duties of loyalty and integrity arising because of the present or past occupation of certain positions in the business relationship.

Overall, the concept of bad faith involves a dishonest intention or other deceitful motive that departs from accepted principles of ethical behaviour or honest commercial and business practices (T-795/17, NEYMAR).

Finally, pursuant to Articles 5(4) and 6(1)(b) of the Directive 2005/29/EC (Unfair Commercial Practices Directive), commercial practices are considered ‘unfair’ and therefore dishonest if they contain false information or are in any way such as to deceive the average consumer in relation, inter alia, to the main characteristics of the product, such as its geographical or commercial origin.

Comment

This case is important from a number of perspectives, including in clarifying further the increasingly important notion of bad faith. In this respect, readers might be also interested to know that yesterday the High Court  of England and Wales decided the Skykick case further to the CJEU decision last January, commented on IPKat here, here and here).