A decade later, and the Zara trade mark saga continues

Background

Inditex, the Spanish fashion group whose flagship store is Zara, sought in 2010 to register the word mark “ZARA” as a European Union trade mark (EUTM) for goods and services in Classes 29 to 32, 35, and 43 (see the table below with a more detailed list). Ffauf Italia, an Italian food producer, filed an opposition against all the goods and services in the application.

The opposition was based on several earlier marks, including an Italian figurative mark with a word element “ZARA”, registered in Class 30, and an international registration for “LE DELIZIE ZARA”, registered in Classes 29 and 30.

From the BoA decision (R 2040/2019-4, para. 63)

In 2014, the EUIPO’s Opposition Division partially upheld the opposition, allowing registration only in Class 43. Both parties appealed to the Boards of Appeal (BoA), which sided with Ffauf Italia and rejected Inditex's application altogether.

The General Court annulled the decision of the BoA (T-269/18) in 2019, holding that the BoA decision lacked sufficient reasoning and certain statements required a more detailed explanation. The case was returned to the BoA and assigned to a different board. After re-examining the case, the BoA allowed the EUTM in Classes 31 and 32, but rejected it in the remaining classes (R 2040/2019-4). Inditex appealed to the General Court (T-467/20).

Genuine use

Inditex first argued that the BoA erred in finding that there was genuine use of the earlier Italian figurative mark ZARA in respect of ‘dry pasta of Italian origin’. During the proceedings before EUIPO, Ffauf Italia submitted several documents as proof of use, all contested by Inditex as inconclusive.

For instance, the proof of use included five invoices relating to participation in a trade fair. Inditex argued that such invoices are not genuine evidence of sales and must be rejected. The General Court sided with the BoA. It affirmed that, while invoices relating to participation in a trade fair do not show the extent of use, those invoices can still be used to demonstrate that the mark had been used in connection with “genuine, public and outward-looking commercial activity” (T-467/20, para. 93).

The General Court also admitted as proof of use a witness statement by the chairman of the board of directors of Pasta Zara, electronic catalogues, internal promotional catalogues, and invoices for a sales figure of approx. EUR 40 000.

Similarity of the goods and services

As part of its second claim, Inditex argued that the BoA had erred when comparing goods and services designated in its application with those covered by the trade mark registrations of Ffauf Italia.

The BoA concluded that the Inditex application was only valid in Class 31 (“fresh vegetables”) and Class 32 (“fruit juices”). In the remaining classes (see the table above), the BoA found a confusing similarity with the goods and services covered by Ffauf Italia's trade marks. The General Court confirmed the BoA’s analysis and rejected these claims.

The BoA had opined that “milk products” are similar to “olive oil”. Milk products include butter, which has the same purpose and method of use as olive oil, and frequently also in clear competition with these goods (R 2040/2019-4, para. 69). It also found that the “flour” is similar to “pasta” and “breadstick”. Flour is the main ingredient of pasta and breadsticks and indeed flour may be used to prepare the latter goods (R 2040/2019-4, para. 74). The General Court agreed with this analysis.

The main point of contention was whether there is similarity between “Restaurant services (food); self-service restaurants, cafeterias” in Class 43 and “Dry pasta of Italian origin” and “Sauces for pasta” in Class 30. According to the BoA, the answer is "yes", since restaurants can sell ready-to-eat take-away meals (R 2040/2019-4, paras. 90-91).

Inditex contested this reasoning, arguing that it is insufficient to base a finding of similarity between these and goods and services. Inditex further claimed that dry pasta and sauces for pasta are not typically sold in a restaurant. However, the General Court confirmed the BoA analysis. It agreed with BoA, that there is at least a low degree of similarity between the contested services and the earlier goods, due to their complementarity. (T-467/20, para. 132). Therefore, registration could only proceed in Class 31 (“Fresh vegetables”) and Class 32 (“Fruit juices”).

Reputation of the Inditex mark

Inditex also alleged that the BoA had erred in the conceptual comparison of the marks, which was done as part of the global assessment of the likelihood of confusion. In its decision, the BoA stated that conceptual comparison is not possible under the circumstances, because the public perceives “ZARA” as a female name and, as such, the trade mark lacks any underlying concept.

Inditex disagreed, arguing that “ZARA” has extraordinary reputation and is a “unique trade mark” (T-467/20, para. 137). The relevant public will perceive it as referring to the famous retail brand that belongs to Inditex. This high reputation, and the “uniqueness” (as stated by Intidex) of the word “zara”, allow for conceptual comparison of the two marks and neutralize any visual and phonetic similarity.

The General Court rejected this argument, stating that in EU trade mark law there is no such notion as reputation of the later mark when assessing the likelihood of confusion (T-467/20, paras. 145-146). The court emphasized that only the reputation of the earlier mark (i.e. that of Ffauf Italia) is relevant in examination.

As noted, Inditex has now appealed to the Court of Justice (C-65/22 P). Though the grounds that Inditex will raise are still unknown, the Court of Justice will likely put be the final stop to almost 10 years of litigation. In the meantime, this Kat recommends watching the lively discussion before the BoA in case T-467/20.