General Court on unauthorised trade mark filing of an agent

If a (former) distributor believes that they can do a better job at exploiting a principal’s trade mark and files for its registration, the principal can usually file an opposition based on earlier rights. If the application is filed in a country where the principal does not enjoy trade mark protection, Art. 8(3) EUTMR can play a decisive role:

Upon opposition by the proprietor of the trade mark, a trade mark shall not be registered where an agent or representative of the proprietor of the trade mark applies for registration thereof in his own name without the proprietor's consent, unless the agent or representative justifies his action.

In its recent decision in CEDC International v EUIPO - Underberg (Forme d’un brin d’herbe dans une bouteille), T-145/22, the General Court had the opportunity to clarify the scope of Art. 8(3) EUTMR.

Background

From the 1970s to the 1990s, the predecessor to CEDC International sp. z o.o. (‘CEDC’) produced vodka containing a blade of grass in the bottle. CEDC’s predecessor sold the vodka to Agros, a Polish state-owned undertaking. Agros, which was entitled to export Polish vodkas abroad at that time, sold the vodka to Underberg AG (‘Underberg’) and its predecessor for distribution outside of Poland under various ‘importer agreements’ concluded in 1983, 1987, 1993 and 1999. To understand the case better it is important to remember that Poland joined the EU in 2004.

On 18 March 1996, Underberg filed for registration of EU trade mark no. 33266 for ‘spirits and liqueurs’. It covered the following sign (the General Court’s judgment says it is a 3D trade mark but the EUIPO’s database indicates ‘other’ as trade mark type):

Underberg provided the following description:

The object of the trademark is a greeny-brown blade of grass in a bottle, the length of the blade of grass is approximately three-quarters the height of the bottle.

CDEC’s predecessor filed an opposition based on various earlier marks, including 3D trade marks with a similar blade of grass inside a bottle, e.g.

· French trade mark no. 95588457 

and

· Polish trade mark no. 85811 

CEDC’s predecessor invoked various grounds, most of which were rejected by the Board of Appeal (‘BoA’) and the General Court in prior decisions. In the case discussed here, the only question pending was whether CEDC could successfully rely on Art. 8(3) EUTMR. The BoA rejected the opposition. CEDC appealed to the General Court.

The General Court’s decision

The General Court dismissed the appeal. According to settled case law, the purpose of Art. 8(3) EUTMR is to prevent the misuse of the earlier mark by the agent or representative, as those persons may exploit the knowledge and experience acquired during their business relationship with the principal and may therefore improperly benefit from the effort and investment which the latter made.

The General Court clarified four important points:

1. The concept of ‘trade mark’ in Art. 8(3) EUTMR also covers non-registered signs, provided that they are acknowledged by the law of the country in which the opponent claims to have an earlier right.

2. The ‘trade mark’ relied on by the opponent does not have to be protected in the EU. The Court reasoned that requiring protection in the EU would lead to an overlap with Art. 8(1) EUTMR (protection of trade marks against double identity and likelihood of confusion) and Art. 8(5) EUTMR (infringement of a trade mark with a reputation). Further, Art. 8(3) EUTMR implements Art. 6septies Paris Convention into EU law. The latter provision does not require protection of the earlier mark in the country, in which the agent or representative applied for registration.

3. The opponent’s trade mark must enjoy priority over the contested application and must still be in force at the time when the decision in the opposition proceedings is rendered. CEDC relied, inter alia, on a Polish trade mark, which was already registered when Underberg’s trade mark was filed but was not renewed before the BoA’s decision in the opposition proceedings. Therefore, it could not constitute a ‘trade mark’ in the sense of Art. 8(3) EUTMR.

4. The General Court seems to require that the applicant must “know clearly and precisely” the proprietor’s trade marks for which the latter claims to enjoy protection (at para. 131). According to the judges, this is usually clear for word or figurative marks used on the product. It is supposedly less clear for non-traditional trade marks, such as 3D and position marks. As the court wrote:

For such non-traditional trade marks to be covered by the contractual relationship, it is desirable for the proprietor to state clearly and precisely to the agent that he or she claims and holds rights in those marks so that they are known to the agent. A specific reference in a written agreement is the most appropriate way to make certain of that.

On the question whether Underberg was an agent or representative of CEDC, the Court referred to CJEU case law holding that this condition is to be interpreted broadly. It covers all forms of relationships based on a contractual agreement under which one of the parties represents the interests of the other, regardless of how the contractual relationship is legally categorised. Any agreement of commercial cooperation, whether in writing or not, is sufficient that gives rise to a ‘fiduciary’ relationship by imposing on the agent/representative, expressly or implicitly, a general duty of trust and loyalty as regards the interests of the principal. A mere purchaser or client of the principal cannot be regarded as an ‘agent’ or as a ‘representative’, since they are under no special obligation of trust towards the principal. The contractual agency or representation agreement must be entered into directly by the parties, and not through third parties. Art. 8(3) EUTMR can be invoked against trade mark applications filed after the contractual relationship ended, as long as an obligation of trust and confidentiality still existed at the time of the filing.

The General Court dismissed CEDC’s appeal because there was no direct contractual relationship between CEDC and Underberg (or their respective predecessors).

Comment

Even though CEDC’s opposition was unsuccessful, the General Court’s decision strengthens the positions of trade mark owners because of the broad interpretation of Art. 8(3) EUTMR. This case law also applies to the principal’s right to:

• oppose the use of the agent’s/representative’s registered EU trade mark (Art. 13 EUTMR);
• request transfer of the agent’s/representative’s registered EU trade mark (Art. 21 EUTMR); and
• invalidate a registered EU trade mark of the agent/representative (Art. 60(1)(b) EUTMR).

The principal cannot request a transfer of the EU trade mark application though. Only after its registration is it possible to file an invalidity application under Art. 60(1)(b) EUTMR and request transfer of the registered mark (Art. 21(2)(a) EUTMR). It is a risky strategy to wait for the registration of the agent’s/representative’s trade mark because they can take action against the principal for infringement of the EU trade mark after registration.

The legislator should consider allowing the principal to request a transfer of an EU trade mark application in the course of opposition proceedings. It should also be possible to file a transfer request in opposition or invalidity proceedings as a main claim and allow the principal to request cancellation of the agent’s/representative’s mark on the basis of bad faith or earlier rights if the main claim for transfer fails.