British Hairways did not take off – as a trade mark

The puns of hair salons are legendhairy. Names like Shear Lock Combs, Julius Scissor and Hairport are just the tip of the iceberg. But what happens when the pun consists of a well-known trade mark? Can the owner of the well-known mark successfully oppose an application for a parodic sign? This question is explored by the German Patent Court in a recently published decision (case 30 W (pat) 15/19).

Background

A private individual applied for German trade mark British Hairways covering ‘hair salon services’ in class 44. British Airways filed an opposition on the basis of its EU trade mark no. 6561534, registered inter alia for ‘airline services’ in class 39. The German Patent and Trade Mark Office rejected the opposition. British Airways appealed to the German Patent Court.

The German Patent Court’s decision

The German Patent Court upheld the appeal and cancelled the British Hairways trade mark.

While there is no likelihood of confusion between the marks given that the services are dissimilar, the judges accepted that British Hairways takes unfair advantage of the distinctiveness of without due cause and within the meaning of Sec. 9(1)(c) German Trade Mark Act.

The earlier mark enjoys a reputation in the EU. The Court considered it to be a well-known fact that ‘British Airways’ has been the name of one of the largest airlines in the world for decades. It offers connections throughout Europe, including Germany, and its planes are branded ‘BRITISH AIRWAYS’. The earlier mark is deemed to enjoy a very high reputation for ‘airline services’.

The German Patent Court accepted that the relevant public establishes a link between the trade marks, which is a necessary condition for an infringement of a trade mark with a reputation. While the relevant services may be dissimilar, the high similarity of the signs and the very high reputation enjoyed by the earlier mark will lead consumers to establish a link.

The judges found that British Hairways takes unfair advantage of the mark. The former rides on the coattails of the latter and benefits from the attention the mark receives. The owner of the contested mark even confirmed in her submissions that she chose the mark because the sign is likely to attract more customers.

The German Patent Court also held that the advantage taken of the distinctiveness of the earlier mark is unfair. Unfairness is, in principle, presumed. The owner of the later mark argued that there is a custom in the relevant sector to include puns in the names of hair salons. The judges accepted that there is a custom to include the word ‘hair’ or the German equivalent in the names of hair salons in a funny way. However, this does not, said the Court, justify taking advantage of the earlier mark. First, the custom does not include making fun of famous trade marks. Rather, common words or names are used, such as ‘CutHairIna’, ‘SaHairA’ or ‘CHairisma’. Further, there was no apparent need for the owner of the contested mark to misappropriate the well-known earlier mark.

The judges also denied ‘due cause’. Assessing this criterion requires balancing the parties’ interests. British Airways could invoke the right to protection of its intellectual property (Art. 17(2) EU Charter of Fundamental Rights (‘CFR’)). The owner of the later mark could rely on the right to freedom of expression (Art. 11(1) CFR) and the freedom of the arts (Art. 13 CFR).

The freedom of the arts also covers the parody of well-known trade marks or products. The German Patent Court accepted that ‘British Hairways’ constitutes a humorous play on ‘BRITISH AIRWAYS’ and is protected as a parody by Art. 13 CFR. However, British Airways’ intellectual property rights prevailed in the balancing exercise. According to the judges, the opposition proceedings only concerned the cancellation of the trade mark ‘British Hairways’ but not its use. It is unreasonable to grant the owner of the contested mark a permanent, exclusive registered right to a sign, irrespective of the way it is used, which takes advantage of a trade mark with a very strong reputation. Additionally, the exclusive right to the later mark can be transferred and licensed. Also, the existence and the reputation of the earlier mark enabled the contested mark to make sense in the first place.

British Airways’ intellectual property right also trumped the freedom of expression of the owner of the later mark. It is not apparent, according to the judges, that the owner of the later mark intended to criticise the airline service of British Airways. The Court, therefore, questioned whether Art. 11(1) CFR would be affected at all. In any event, the owner of a well-known trade mark does not have to accept registration of an infringing mark.

Comment

When it comes to the parody of (usually well-known) trade marks, German courts appear to distinguish between registering the parody as a trade mark and its use. The German Supreme Court’s judgment Springender Pudel (‘Jumping Poodle’, summarized here) suggests that it is easier to attack the registration of a parody successfully than the use of it. So far, decisions on whether the parodic use of a trade mark can be justified by the freedom of expression or the freedom of the arts are rare. In a recent decision of the Italian Supreme Court (discussed here), the Justices held that a parody might be trade mark infringing. The Benelux Court of Justice concluded in a 2019 decision (discussed here) that the artistic use of a trade mark is lawful, where the artistic expression is the original result of a creative design process, which does not aim to harm the trade mark or the trade mark holder.

In this Kat’s opinion, the rights to freedom of expression and freedom of the arts should take a backseat to the intellectual property right of a (well-known) trade mark.

While it is certainly positive to have a trade mark parody removed from the register, its use is much more aggravating. Consumers do not usually see what marks are registered but they encounter trade marks in reality and base commercial decisions on them. The impact of the use on the well-known trade mark is much more severe than its mere registration.

On the other hand, prohibiting the use of a parody can curtail the freedom of the arts and the freedom of expression. However, the prohibition only relates to ‘use in the course of trade’, i.e. commercial use. Non-commercial uses remain possible. In this Kat’s opinion, this strikes a fair balance between the parties’ interests.