Four rings on a car grille infringe Audi’s trade mark

The use of trade marks of original equipment manufacturers for non-original spare parts and accessories is frequently the subject of court disputes. As reported here, the Advocate General (‘AG’) did not consider the sale of a non-original radiator grille with a mounting device taking the shape of the Audi logo for an Audi A6 to be infringing. The Court of Justice of the EU (‘CJEU’) disagreed in its recent Audi judgment (case C-334/22).

Background

Audi owns EU trade mark no. 000018762 covering ‘land, air and water vehicles and parts thereof (not included in other classes), including engines for vehicles’ in class 12 protecting the following sign:

The defendant is a natural person, who sold radiator grilles customised and designed for old Audi models from the 1980s and 1990s. The radiator grilles included, like the originals, a carved space for inserting and mounting Audi’s logo, corresponding to the outline of Audi’s EU trade mark, which presumably looked like this:

Audi sued the defendant before the Sąd Okręgowy w Warszawie (Regional Court of Warsaw) for trade mark infringement. The court was unsure whether the shape of the mounting device affected the origin function of Audi’s trade mark and, if so, whether the defendant could rely on Art. 14(1)(c) EUTMR. This provision states:

An EU trade mark shall not entitle the proprietor to prohibit a third party from using, in the course of trade the EU trade mark for the purpose of identifying or referring to goods or services as those of the proprietor of that trade mark, in particular, where the use of that trade mark is necessary to indicate the intended purpose of a product or service, in particular as accessories or spare parts.

The court referred the following (partly shortened and paraphrased) questions to the CJEU:

(1) Does Art. 14(1)(c) EUTMR allow the use of a sign which is identical or confusingly similar to an EU trade mark, in relation to automotive spare parts (radiator grilles) where that sign constitutes a mounting element for an automotive accessory, and:

(a) where the form of the mounting element is not technically required to affix the original emblem;

or

(b) where the form of the mounting element is technically required to affix the original emblem?

If the answer to any of the questions in 1(a) is in the affirmative:

(2) What criteria should be used in this case to determine whether the use of an EU trade mark is consistent with honest practices in industrial and commercial matters?

(3) Does a trade mark, which is part of the shape of a car part, fulfil a designation function?

(4) Does the shape of the mounting element fulfil a designation function in this case?

The CJEU’s decision

Questions (3) and (4)

Like the AG, the CJEU responded to questions (3) and (4) together and rephrased them. What the Polish court actually wanted to know (according to the CJEU) is whether the use of the Audi logo on the grille constitutes ‘use in the course of trade’ in the meaning of Art. 9(2) EUTMR and is liable to affect one or more of the trade mark functions.

In responding to this question, the CJEU reiterated fundamental principles of EU trade mark law:

1. The Court referred to its Ford Motor Company decision (case C-500/14, at paras. 38 et seqq.; IPKat here), in which it found that the repair clause of Art. 110 Community Design Regulation cannot be raised as a defence against trade mark infringement. The role of preserving undistorted competition in EU law is the subject of Art. 14 EUTMR.

2. The condition of ‘use’ requires active conduct. The types of uses mentioned in Art. 9(2) EUTMR are examples of infringing uses and are not exhaustive.

3. Use ‘in the course of trade’ occurs if it is in the context of a commercial activity intended to obtain an economic advantage and not in the private sphere.

4. An infringement of Art. 9(2)(a) EUTMR (‘double identity’) requires the finding that the third party use adversely affects or is liable to adversely affect one of the trade mark functions, such as the origin, quality, communication, investment or advertising function.

5. An infringement of Art. 9(2)(b) EUTMR (‘likelihood of confusion’) requires the finding that the third party use adversely affects or is liable to adversely affect the ‘essential’ origin function.

6. An infringement of Art. 9(2)(c) EUTMR (‘trade mark with a reputation’) exists if the conditions of the provision are fulfilled.

The Court considered that:

• The defendant’s goods do not emanate from Audi,
• The referring court considered the mounting element to be identical or similar to Audi’s trade mark,
• The import, marketing and offer for sale of the radiator grilles fall under Art. 9(3)(a),(b) and (c) EUTMR,
• The visibility of the mounting element to consumers wishing to purchase a grille in order to repair or have repaired a car creates a ‘material link’ between the spare part and Audi’s trade mark.

It is now for the national court to decide whether the mounting element is identical or only similar to Audi’s trade mark and used for identical or similar goods. If double identity exists, the court will have to apply Art. 9(2)(a) EUTMR.

If the signs and/or the goods are only similar, the national court will have to assess whether a likelihood of confusion exists.

Since Audi’s trade mark is widely known in Poland, the national court must also assess if the conditions of Art. 9(2)(c) EUTMR are fulfilled.

Based on these considerations, the CJEU responded to questions (3) and (4):

Article 9(2) and (3)(a) to (c) [EUTMR]

must be interpreted as meaning that a third party who, without the consent of the manufacturer of motor vehicles which is the proprietor of an EU trade mark, imports and offers for sale spare parts, namely radiator grilles for those motor vehicles, containing an element which is designed for the attachment of the emblem representing that trade mark and the shape of which is identical with, or similar to, that trade mark, is using a sign in the course of trade in a manner liable to affect one or more of the functions of that trade mark, which is a matter for the national court to ascertain.

Question (1)

By referring to its recent Inditex judgment (case C-361/22, IPKat here), the CJEU held that, although the wording of Art. 14(1)(c) EUTMR has been broadened by the EU trade mark reform, the former narrower wording was retained as an example in the provision. It covers situations where the use of the trade mark is necessary to indicate the intended purpose of a product or service, in particular as an accessory or spare part.

The purpose of this narrower limitation is to enable suppliers of complementary goods or services to inform the public of the intended purpose of the goods or services in a comprehensible and complete manner.

In the present case, the purpose of the mounting element is to provide space for the Audi logo. It is also meant to resemble the original Audi grille as closely as possible.

The CJEU makes a distinction between (1) affixing the sign to the goods and (2) not affixing the sign to the goods but merely using it to indicate the purpose of the spare part. The latter situation is covered by Art. 14(1)(c) EUTMR; the former is not.

The Court also found that it is irrelevant whether it is technically possible to attach the Audi logo to the grille without the mounting element taking a shape that is identical or similar to that of the Audi logo.

The CJEU concluded:

Article 14(1)(c) [EUTMR]

must be interpreted as meaning that it does not preclude the manufacturer of motor vehicles which is the proprietor of an EU trade mark from prohibiting a third party from using a sign identical with, or similar to, that trade mark in relation to spare parts for those motor vehicles, namely radiator grilles, where that sign consists of the shape of an element of the radiator grille designed for the attachment thereto of the emblem representing that trade mark, regardless of whether or not there is a technical possibility of attaching that emblem to the radiator grille without affixing that sign to it.

Question (2)

In light of the response to question (1), the CJEU saw no need to answer the second question.

Comment

The CJEU’s decision seems quite clear despite the proviso in the response to questions (3) and (4) “which is a matter for the national court to ascertain”. In this Kat’s opinion, this is due to the fact that the referring court left open whether the signs and the goods are identical or only similar. Depending on this assessment, either Art. 9(2)(a) EUTMR or Art. 9(2)(b) EUTMR may apply (in addition to Art. 9(2)(c) EUTMR). The CJEU’s press release (which can be assumed to have been approved by the judges) clearly expresses that the CJEU concluded that the defendant’s radiator grille infringes Audi’s trade mark.

As a consequence of this decision and as a general rule, the original manufacturer’s trade mark may not be affixed to a spare part, even if the sign is part of the design (or necessary to mount the trade mark). It will not be perceived as an indication of the purpose of the spare part to be integrated in the complex product. Such information must be provided separately.

An additional argument against the application of Art. 14(1)(c) EUTMR is that using the Audi logo is hardly necessary to indicate the purpose of the spare part. It does not explain for which Audi model the spare part is suitable. Further, this can be done in a less intrusive way by using the word mark ‘Audi’ instead of the (usually more appealing) figurative mark.