New referral to the CJEU: When is a trade mark deceptive?

The current (third) Trade Mark Directive (Directive (EU) 2015/2436, ‘TMD3’) contains two separate provisions dealing with deceptive trade marks. According to Art. 4(1)(g) TMD3 a trade mark may not be registered or, if registered, may be declared invalid if the trade mark is

of such a nature as to deceive the public, for instance, as to the nature, quality or geographical origin of the goods or service.

Art. 20(b) TMD3 provides a separate ground for revocation for misleading trade marks. A trade mark may be revoked if, after the registration date

as a result of the use made of it by the proprietor of the trade mark or with the proprietor's consent in respect of the goods or services for which it is registered, it is liable to mislead the public, particularly as to the nature, quality or geographical origin of those goods or services.

The French Cour de Cassation asked the Court of Justice of the EU (‘CJEU’) whether a trade mark is deceptive if it does not mislead about characteristics of the goods and services, but rather about the company offering these goods and services (Fauré Le Page, case C-412/24).

Background

The French company Maison Fauré Le Page had been buying and selling arms, ammunition and leather accessories in Paris since 1716. It was dissolved and all its assets and liabilities had been transferred to its sole shareholder, the company Saillard, in 1992.

In 1989, Saillard filed an application for the French trade mark ‘Fauré Le Page’ covering, inter alia, ‘firearms and their parts; leather and imitations of leather; trunks and suitcases’. In 2009, Saillard sold this trade mark to Fauré Le Page Paris, a French company that was established in 2009.

In 2011, Fauré Le Page Paris filed applications for the French trade marks nos. 3839809 and 3839811 both containing the words ‘Fauré Le Page Paris 1717’ and covering, inter alia, ‘leather and imitations of leather; trunks and suitcases; travelling bags; handbags’ (the ‘Paris 1717 Trade Marks’).

In 2012, the company Goyard ST-Honoré sought cancellation of the Paris 1717 Trade Marks on the ground that they were misleading in accordance with the French implementation of the Art. 3(1)(g) Second Trade Mark Directive (‘TMD2’; now Art. 4(1)(g) TMD3).

The Court of Appeal of Paris ruled that the Paris 1717 Trade Marks were invalid. The judgment found that the words ‘Paris 1717’ referred to the place and date of establishment of the business and led, inter alia, the public to believe in the continuity of operations since 1717 and in the transfer of know-how from the former Maison Fauré Le Page to Fauré Le Page Paris, resulting in the public attributing a particular quality or prestige to the goods.

However, the former Maison Fauré Le Page (established in 1716) ceased its activity in 1992, so Fauré Le Page Paris (established in 2009) did not continue the activity of the former Maison Fauré Le Page. For the average consumers of luxury leather goods marketed by the Fauré Le Page companies, the use of very old know-how is considered to be a decisive factor in their purchase decision.

Fauré Le Page Paris appealed to the Cour de Cassation. They argued that Art. 3(1)(g) TMD2 (now Art. 4(1)(g) TMD3) requires deceit as to the characteristics of the goods and services but not as to the qualities of the trade mark’s proprietor, such as the year of establishment. 

The reference for a preliminary ruling

The Cour de Cassation considered that the deceptive nature of a trade mark is not limited to a misleading message relating to the characteristics of the goods or services. It may also concern the characteristics of the owner of the trade mark, and in particular its age. Consumers are likely to infer from the false information in the trade mark that the product has certain qualities or enjoys a certain prestige, which may influence the consumer’s purchasing decision.

The Cour de Cassation referred the following questions to the CJEU:

1. Must Art. 3(1)(g) TMD2 be interpreted as meaning that a reference to a fanciful date in a trade mark conveying false information on the age, reliability and know-how of the manufacturer of the goods and, consequently, on one of the intangible characteristics of those goods is sufficient to establish the existence of actual deceit or a sufficiently serious risk that the consumer will be deceived?

2. If the answer to the first question is in the negative, must that article be interpreted as meaning?

(a) that a trade mark may be regarded as deceptive where there is a likelihood that consumers of the goods and services designated by the trade mark will believe that the proprietor of that trade mark has been producing those goods for centuries, thereby conferring on them a prestigious image, whereas that is not the case?

(b) that, in order to establish the existence of actual deceit or a sufficiently serious risk that the consumer will be deceived, on which a finding that a trade mark is deceptive depends, the trade mark must constitute a sufficiently specific designation of potential characteristics of the goods and services for which it is registered, so that the targeted consumer is led to believe that the goods and services possess certain characteristics which they do not in fact possess?

Comment

1. It seems that the claimant only alleged the trade marks to have been registered in breach of Art. 3(1)(g) TMD2 and not that their use is misleading (which would be Art. 12(2)(b) TMD2). If this understanding of the reference is correct, the questions asked do not appear to be decisive for the outcome of the proceedings before the national court.

The CJEU held in W. F. Gözze Frottierweberei and Gözze (C-689/15 at para. 55) with respect to Art. 7(1)(g) EUTMR (the equivalent of Art. 3(1)(g) TMD2) that the trade mark must per se create the risk of deceiving consumers. This means that the only circumstances that may be taken into account are the sign and the goods and services (see case T-60/17 at para. 63, upheld by C-326/18 P).

Since it is not apparent from the sign ‘Fauré le Page Paris 1717’ in combination with the goods themselves that the trade mark is used by a company that has not been established in 1717, the requirements of Art. 3(1)(g) TMD2 are arguably not fulfilled.

The misleading use by a company that was not established in 1717 can only be invoked as a ground for revocation under Art. 12(2)(b) TMD2 (now Art. 20(b) TMD3).

2. If the Cour de Cassation posed its questions with respect to Art. 12(2)(b) TMD2 (now Art. 20(b) TMD3), the latter’s wording would not – unlike the absolute ground of descriptiveness in Art. 3(1)(c) TMD2 – be limited to a deception about the characteristics of the goods or services.

In any event, if the geographical origin of goods and services is regarded as a characteristic of the goods and services in Art. 3(1)(c) TMD2, then why not the date of establishment of the manufacturer of the goods and services? Both are non-tangible properties but they can have an important impact on the (perceived) quality of the goods and services and on the purchasing decision of consumers. 

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