A royal headache for EU trade mark courts - the Italian SUSSEX ROYAL trade mark application is revived by the EU Board of Appeal

In a recent decision (R 1729/2022-4) on the distinctiveness of individual parts of composite word marks, the EUIPO's Fourth Board of Appeal (the Board) reversed a decision of the Opposition Division which had rejected an Italian individual's EU trade mark application for 'SUSSEX ROYAL', despite finding that a significant part of the public would associate this mark with Prince Harry and Meghan Markle.  

Background

In January 2020, Ui Phoebix Kerbl (the Applicant) applied to register the word mark SUSSEX ROYAL (the Mark) as a European Union trade mark (EUTM) in a number of classes, including classes 32 and 33 in respect of "beer and brewery products, soft drinks" and "alcoholic beverages (except beer)", respectively (the Application). 

Royal Unibrew (the Opponent) is a Danish brewing and beverage company which owns a number of brands including Ceres, Faxe, Albani, Thor, Karlens and, importantly, Royal. 

The Opponent filed an opposition against the Application in July 2020 (the Opposition), based on two International trade mark registrations (ITMRs) designating the European Union for the word marks ROYAL (the ROYAL ITMR) and ROYAL UNIBREW in class 32 (together, the ITMRs), including for "beers".  

The grounds of opposition were, summarily:

1. That the Application was for a similar or identical mark as the ITMRs, in respect of similar or identical goods, and there was a likelihood of confusion pursuant to Article 8(1)(b) of the European Union Trade Marks Regulations 2017/1001 (EUTMR); and/or
2. The Application took unfair advantage of, or was detrimental to, the distinctive character or reputation of the ITMRs, pursuant to Article 8(5) EUTMR.

The Opposition Division of the EUIPO only examined the first ground of the Opposition, in respect of the ROYAL ITMR, finding that there was indeed a likelihood of confusion, and upholding the Opposition. The factors for this decision included: 

1. "Beer" was identically included in both lists of goods; 
2. "Soft drinks" and "alcoholic beverages (except beer)", as included in the Application, were both considered to be similar to the "beer" component of the ROYAL ITMR; 
3. According to the case-law, the term "royal" is perceived, within the EU, as an "ordinary, descriptive term which is evocative of the monarchy and, more generally, of luxury and magnificence" (C-514/06 P, Armafoam); 
4. The word "SUSSEX" is, at best, lowly distinctive, as it will be perceived as referring to the geographic origin of the goods (a region in England), and additionally the expression "SUSSEX ROYAL" will connote to the relevant public a reference to members of the British royal family;
5. Visually, orally and conceptually the Mark and the ROYAL ITMR are "similar to an above-average degree";
6. Consequently, there was a likelihood of confusion, and there was no need to assess reputation or use for the purposes of Article 8(5) EUTMR. 

The Applicant appealed to the Board. 

Royal Kat

Photo: travel oriented

The Board's decision

The Applicant's grounds of appeal were summarily as follows: 

1. The Applicant agreed with the Opposition Division that the word "ROYAL", as used in both signs, has a very low degree of distinctive character; 
2. This meant that the initial part of the Mark (i.e. the term "SUSSEX") was therefore distinctive, even if it did refer to the geographic origin of the relevant goods; 
3. As consumers pay more attention to the beginning of a sign (due to left-to-right reading habits),  ‘SUSSEX’ is the first dominant word in the Mark, and in fact word marks do not have any dominant or visually more striking elements because, by definition, they are written in a standard typeface; 
4. As the Opposition was based on the ROYAL ITMR, which was only registered for goods in Class 32, the Opposition Division could not reject the Application in respect of goods in Class 33; and
5. In light of the above, there is no likelihood of confusion for the public.

Relevant public and comparison of goods

The Board began by noting its agreement with the Opposition Division in respect of the relevant public, being the public at large, who is likely to display an average degree of attention (T-195/20, AGUA ALCALINA), and the territory for assessment of likelihood of confusion is the EU as a whole. 

As for similarity between goods, the reference point is whether the relevant public would perceive the relevant products as having a common commercial origin (T-85/02, Castillo). However, the mere fact that goods and services are in the same Nice class shall not automatically mean that they are similar (as per Article 33(7) EUTMR). 

The Opposition Division's findings in respect of class 32 were not questioned by the parties, and in respect of class 33, the Board considered that the general category of "alcoholic beverages (except beer)" also covered low-alcohol content beverages (such as cider) which were close in nature to beer and often competed in the market, as well as sharing the same distribution channels. As the EUIPO cannot dissect broad categories of goods/services ex officio, the relevant goods in classes 32 and 33 had to be considered similar to a high degree. 

Comparison of marks 

As for comparing the relevant marks, the Board noted that a global assessment of likelihood of confusion would need to be carried out, as the average consumer normally perceives a mark as a whole (C-251/95, Sabel, and others). 

In respect of the Mark, the Board agreed that the common element ROYAL only had a very low distinctive character, such that it did not carry much weight in analysing the similarity between the two signs (C-705/17, ROSLAGSOL). 

However, the Board considered that a significant part of the public, who would have knowledge of Prince Harry and Meghan Markle as being the Duke and Duchess of Sussex, would perceive SUSSEX ROYAL unitarily as a reference to them - particularly given the press coverage they have received across the EU. The term SUSSEX ROYAL therefore enjoyed at least average distinctiveness, even if SUSSEX might be taken as a geographical reference by those who were not familiar with the British royal family. 

Further, and although SUSSEX by itself had a lower distinctive character, its presence at the beginning of the Mark created a difference overall impression than the ROYAL ITMR, as did the fact that the two signs have different lengths, and a different rhythm of pronunciation. 

Finally, the Board noted that where signs overlap in respect of a non-distinctive element (in this case ROYAL), this could not lead to greater than low similarity between those signs, where differences between them are clearly perceptible (T-261/19, OptiMar). The Board consequently found the two signs to be similar only to a low degree.

Overall assessment of likelihood of confusion

A global assessment of the likelihood of confusion requires some interdependence between the relevant factors, in particular between the similarity of the signs and that of the goods or services covered - so high degree of similarity in respect of one factor can offset a lower degree of similarity in respect of another. 

However, given that the similarity between the Mark and ROYAL ITMR only resided in a minimally distinctive element, it was unlikely that consumers would consider there to be any association between the undertakings - particularly where the ROYAL ITMR had a low degree of inherent distinctiveness and therefore enjoyed less extensive protection under EU trade mark law (T‑70/20, MUSEUM OF ILLUSIONS).

The Board therefore found that there was no likelihood of confusion, and remitted the case to the Opposition Division for an assessment in respect of Article 8(5) EUTMR.  

Comment

In this Kat's view, the Board seems to have reached the right conclusion, as the addition of the entire word SUSSEX to a non-distinctive mark should be enough for a finding of a lower degree of similarity.  The decision is nevertheless interesting as, although the Application appears to have been opportunistic - as it followed shortly after the news that Prince Harry and Meghan Markle had launched an Instagram account called Royal Sussex, and filed a UK trade mark application for the same - that application has since been withdrawn, purportedly due to the changes in the Sussexes' involvement in royal life. 

What this has left is a headache for trade mark registries who may want to reject such applications but find it difficult to do so, in circumstances where (like in this case) it is the Sussexes' use of the mark that has made it more distinctive, thus making oppositions such as those by the Opponent more difficult!