Caffeine headache for Monster as General Court holds no genuine use on Class 30 goods

Kat friend, Becky Knott, reports on an interesting decision by the General Court that is notable for the degree to which the court analysed the properties of the relevant goods in determining trade mark non-use.

Following the latest trade mark judgment between Monster Energy Co. and Frito-Lay Trading Company GmbH (see here for a previous decision), Monster came away licking its wounds.

In two joined decisions, the General Court considered non-use within the meaning of Article 51(1)(a) of Regulation No 207/2009. Specifically, it considered whether Monster’s use of ‘x-presso monster’ on caffeine-flavoured energy drinks constituted genuine use of MONSTER / MONSTER ENERGY for “coffee based beverages”. The GC agreed with the BoA and thought not. [BoA decisions here and here, GC decision here, joined case nos T-758/20 and T-759/20].

Background

On 3rd November 2010, Monster applied to register MONSTER as an EU trade mark for “Coffee based beverages and coffee based beverages containing milk in Class 30” and “Non-alcoholic beverages, namely energy drinks and energy drinks flavoured with coffee, all enhanced with vitamins, minerals, nutrients, amino acids and/or herbs in Class 32”.

On 5th November 2010, Monster filed another application, to register MONSTER ENERGY as an EU trade mark for “Coffee based beverages and coffee based beverages containing milk in Class 30”. Both marks registered on 19th April 2011.

On 25th April 2017, Frito-Lay applied to revoke both of Monster’s registrations on the ground that the marks had not been put to genuine use within a continuous period of five years. The applications for revocation concerned all the goods in Class 30 (‘the contested goods’). As such, Frito-Lay sought partial revocation of the MONSTER registration and full revocation of the MONSTER ENERGY registration.

On 22nd and 23rd October 2019, the EU IPO’s Cancellation Division revoked the marks in respect of the contested goods, finding that use of the marks had only been proven in respect of energy drinks. Monster appealed, but on 5th October 2020, the BoA dismissed both appeals.

The BoA held that: (1) it was necessary to distinguish between ‘coffee based beverages’ in Class 30 and ‘energy drinks’ in Class 32; (2) the ingredients of the ‘x-presso monster’ goods (which were the goods referred to in Monster’s evidence) had the same characteristics as ‘energy drinks’; (3) the real function or purpose of the ‘x-presso monster’ goods was to serve as ‘energy drinks’; and (4) the MONSTER ENERGY mark had not been used on the ‘x-presso monster’ goods.

Accordingly, the BoA upheld the decisions of the Cancellation Division in their entirety. Monster then appealed to the GC.

The GC’s Decision

Monster requested that the GC annul the contested decisions and uphold the registrations for MONSTER and MONSTER ENERGY. It submitted that the BoA had erred in its assessment, alleging that the BoA had: (1) failed to consider that a product can be classified and put to genuine use in more than one class due to its composite nature; (2) given undue weight to the shared characteristics of energy drinks and the ‘x-presso monster’ goods; and (3) erred by taking the manufacturing process of the ‘x-presso monster’ goods into account.

The GC dismissed Monster’s claim as unsubstantiated that some consumers would purchase the ‘x-presso monster’ goods as coffee-based beverages rather than a coffee-flavoured energy drink. It noted that the ‘x-presso monster’ goods had the same function or purpose as Monster’s other energy drinks. Accordingly, it considered it likely that consumers would understand the reference on the packaging to ‘x-presso’ (i.e. ‘espresso’) to refer to the flavouring of the goods “rather than as an indication that they are beverages which are prepared from coffee” (paragraph 45).

The GC considered the direct association of the terms “coffee” with “energy” on the packaging to reinforce the idea that the goods were coffee-flavoured rather than coffee-based goods, emphasising the actual purpose of the goods. Such was the case also for the English description of the product, “espresso coffee drink with milk”. Since this description appeared just above the list of ingredients in small characters, followed by “with taurine, L-carnitine, ginseng and B vitamins”, the GC reckoned it to be further proof that the ‘x-presso monster’ goods corresponded to energy drinks, especially as the “coffee extract (1.3%)” formed only one of many ingredients (and a typical ingredient for energy drinks at that).

The GC pointed out that beverages with a coffee base, i.e. “beverages in which coffee constitutes the predominant and characteristic element”, fall under Class 30 and are expressly excluded from Class 32. In contrast, a beverage which is merely flavoured with coffee falls under Class 32. The GC emphasised that coffee-based beverages and energy drinks “have different natures and do not fulfil the same main function” (paragraph 52). This was so, because coffee-based beverages are characterised by the presence of coffee, whereas coffee-flavoured beverages (such as energy drinks) have a number of ingredients, with coffee playing a secondary role.

The GC noted that consumers are aware of these differences. Moreover, they had actually been highlighted by Monster’s own promotional materials, which had stressed the “energy content” in its ‘x-presso monster’ goods. Further, considering the current market conditions for energy drinks, the GC observed that:

'…energy drinks flavoured with coffee are usually found on the same shelves as energy drinks with other flavours, whether they are the applicant’s or those of other manufacturers. Consumers do not perceive any difference in function or purpose between the various flavours of energy drinks, whether they are coffee flavoured, cherry flavoured, kiwi fruit flavoured, chewing-gum flavoured or mango flavoured. All of those drinks fulfil the same function, namely that of providing an energy boost' (paragraph 64).

In light of the above, the GC held that the BoA correctly found that the function and purpose of the ‘x-presso monster’ goods were consistent with that of an energy drink. Monster had not proven genuine use either of MONSTER or MONSTER ENERGY in connection with the contested goods.

As a result, the GC upheld the BoA’s decisions.

Comment

This case demonstrates that the Nice Agreement is not just an administrative tool, but that it can also play an important role in guiding the court’s assessment regarding non-use. Whilst Monster’s goods contained coffee, this was simply not enough to constitute genuine use of Class 30. Also interesting is the detail in which both the BoA and GC were prepared to scrutinise the properties of the relevant goods to circumvent Monster’s arguments.

Lastly, this case re-emphasises the importance of using a trade mark as registered. To paraphrase the iconic television police detective, Columbo, "that is where Monster made its mistake."

Picture on upper right is by Lightburst and is licensed under the Creative Commons Attribution-Share Alike International license.

Picture on lower left is by akaitori and is licensed under the Creative Commons Attribution Share-Alike 2.0 Generic license.