EU General Court finds that EUTM reputation is acquired progressively and lost slowly (T‑157/23 - Patou)

In a recent decision (T-157/23) on trade marks with a reputation, the General Court of the European Union (the Court) found that a mark's reputation is acquired progressively, and lost gradually, such that evidence from some time before or after the date of assessment can still be of relevance. 

Background

In 2019, Kneipp GmbH (Kneipp), a German manufacturer of natural healing products, filed an application (the Application) to register the word mark JOYFUL BY NATURE (the Mark) as an EU trade mark (EUTM) in a number of classes, including classes 3, 4, 35, and 44, in respect of (summarily) cosmetics, perfumed/scented candles and marketing services. 

In 2020, Maison Jean Patou (Patou), a French luxury fashion house, filed a notice opposition in respect of the Application (the Opposition) on the basis of a number of earlier rights, including its EUTM for the word mark JOY, which had been registered for goods in class 3 (cosmetics). 

The grounds relied on in support of the Opposition were those in Article 8(1)(b) and (5) of the EU Trade Mark Regulation 2017/1001 (EUTMR), namely that an application to register an EUTM will be refused where the mark applied for is identical or similar to an earlier trade mark and there is exists a likelihood of confusion, or where the use without due cause of the trade mark applied for would take unfair advantage of, or be detrimental to, the distinctive character or the repute of the earlier trade mark, respectively. 

The Opposition Division upheld the Opposition on the basis of Article 8(5) EUTMR, in light of the reputation enjoyed by Patou's EUTM for the word mark JOY. Kneipp appealed to the Board of Appeal, which partially annulled the Opposition Division's decision insofar as it related to services in class 35 (marketing) but dismissed the appeal in respect of the other goods and services. 

The Board of Appeal found that all necessary conditions had been satisfied for Article 8(5) EUTMR to apply in this case, taking into account (amongst other factors) the evidence which had been submitted by Patou demonstrating the strong reputation enjoyed by the mark JOY in a substantial part of the European Union, for perfumery and fragrances in Class 3.

Kneipp appealed to the Court. 

The Court's ruling

Kneipp's appeal essentially disputed the Board of Appeal's findings in respect of each of the cumulative conditions which need to be satisfied for an opposition under Article 8(5) EUTMR  to succeed. However the most interesting for trade mark practitioners are the Court's findings in respect of the reputation of an earlier trade mark, and the evidence required to prove such a reputation. 

Kneipp's position was that the documents produced by Patou did not provide evidence of JOY's reputation in France, because market share is a critical factor in evidencing a mark's reputation and the perfume Joy by Jean Patou was: (a) sold only by selected luxury and prominent retailers; and (b) had generated only a low turnover in 2016, 2017 and 2018, with a steady decrease since 2016. 

Reputation

The Court began by noting that although market share was a relevant factor, there was no requirement for a mark to be known by a specific percentage of the relevant public, nor for its reputation to cover all the territory concerned, so long as that reputation exists in a substantial part of that territory (QUARTODIMIGLIO QM, T-76/13 EU:T:2015:94).

Furthermore, in order to establish whether a mark has a reputation, an overall assessment must be carried out of the evidence adduced by the proprietor of such mark (Rubinstein and L’Oréal v OHIM, C‑100/11 P, EU:C:2012:285), and an accumulation of items of evidence may allow the necessary reputation to be established, even though each of those items of evidence, taken individually, may be insufficient (HAWKERS, T‑651/18, EU:T:2019:444). 

In terms of the timing of the assessment, the earlier mark's reputation must be established as at the filing date of the later mark's application for registration (Apiheal, T‑51/19, EU:T:2020:468) - in this case, November 2019. However, documents created after that date cannot be denied evidential value if they enable conclusions to be drawn as to what the situation was on such date; and conversely, a document dated from some time before such date may also be useful in light of the fact that the reputation of a trademark is, in general acquired progressively, and lost gradually. 

In this case, Patou had adduced a large amount of evidence regarding the period from 2013-2017 (including awards, accolades, social media posts, press cuttings and invoices for marketing campaigns), but also documents from as early as the late 1990s, which went towards the historical significance of the JOY mark. 

Although, therefore, the sales of the Joy perfume appeared to be trending downwards from 2016 and Patou had been unable to produce evidence of a significant market share as at November 2019, this did not mean that the reputation which had accrued to the JOY mark prior to this date would have simply vanished overnight, but still survived as at the date of the Application (see also Simca, T‑327/12, EU:T:2014:240, in which it was not ruled out that a historical mark could retain a surviving reputation even where it was no longer used). 

As the Board of Appeal had correctly stated, "the loss of reputation rarely happens as a single occurrence but is rather a continuing process over a long period of time, as the reputation is usually built up over a period of years and cannot simply be switched on and off [...] in addition, such drastic loss of reputation for a short period of time would be up to the applicant to prove". 

The Court observed that this finding was consistent with case-law, and in the absence of concrete evidence showing that the reputation progressively acquired by JOY over many years suddenly disappeared during the last year under examination, the Board of Appeal was entitled to conclude that the earlier mark still had a reputation in November 2019. 

Kat prefers Eau de Catnip

Other conditions under Article 8(5) EUTMR

As for the other conditions, the Court found that the Board of Appeal did not make an error of assessment in finding that:

1. the signs at issue were similar; 
2. the relevant public was likely to establish a link between those marks; 
3. there was a prima facie, non-hypothetical, future risk that Kneipp would take unfair advantage of the earlier mark's reputation, which stemmed from Patou's activities, efforts and investments into such mark; and
4. there was no due cause for the use of the mark applied for.

The appeal therefore failed in its entirety.

 

Comment

This decision will provide some reassurance to owners of famous or iconic marks who may have experienced, due to market conditions outside of their control, a down-tick in sales over a period of time, that market share is not the only factor which determines the reputation of a mark. This should also act as a warning to those who might be contemplating registering a mark which is similar to a well-known historic mark, which might still have a reputation even if it has not been in use for a couple of years.