Burlington arcade wins trade mark battle

30 Jun 2020 , 4:54pm

Luxury brand owners need to take note of a trade mark dispute between London's Burlington shopping arcade and a German sock retailer, says Marks & Clerk Law's Claire Chalmers.

A recent judgment from the CJEU ended an 11-year battle between the owner of London’s Burlington luxury shopping arcade (Tulliallan) and Burlington Fashion GmbH (BF), a German sock retailer. The judgment (Joined Cases C-155/18 P to C-158/18 P) provides useful clarification of the Intel global assessment factors when considering whether there has been damage to an earlier mark and shows that the “attractiveness” of a mark (in and of itself) it is not a decisive factor when considering whether a later mark takes unfair advantage of the distinctive character or reputation of the earlier mark.

The CJEU appeal concerned a conflict between the following word marks and figurative marks containing the verbal element ‘BURLINGTON’, registered by one party for services and another for goods.

Background

Between November 2008 and November 2009, BF filed applications with the EUIPO to register the word mark BURLINGTON and three figurative marks incorporating BURLINGTON for goods in certain Classes 3, 14, 18, and 25 (the contested marks).

Tulliallan, the proprietor of the Burlington arcade in central London where the retailers specialise in the sale of luxury goods, filed notices of opposition to these registrations on the basis of earlier rights in the marks set out above.

Tulliallan relied primarily on the grounds set out in Article 8(5) and 8(1)(b) of Regulation 207/2009 (being detrimental to the earlier mark’s reputation and likelihood of confusion). Note that this case was decided under Regulation 207/2009, but is transferable in its application in relation to the current Regulation 2017/1001 (the EUTMR), with the Article 8 provisions of the EUTMR mirroring the wording of Article 8 of Regulation 207/2009.

The Opposition Division accepted these grounds, but following appeal by BF, the Fourth Board of Appeal (BOA) annulled the Opposition Division’s decisions, finding that Tulliallan had failed to establish a risk of damage to its marks. Additionally, although the marks were similar, the BOA ruled out a likelihood of confusion between them, as it considered the goods and services at issue were different. Tulliallan then lodged four annulment actions at the General Court (GC).

In relation to the ground of appeal under Article 8(5), the GC found that Tulliallan had not submitted consistent evidence to show that the use of the contested marks took unfair advantage of the distinctive character or reputation of its earlier trade marks. The GC also found that, despite the fact that Tulliallan stressed the “near uniqueness” of its earlier trade marks and their “significant and exclusive” reputation, it had not provided specific evidence to establish that the use of the contested trade marks would make its earlier marks less attractive.

In relation to the likelihood of confusion under Article 8(1)(b), the GC agreed with the BOA’s finding that Tulliallan’s services and the goods covered by the contested marks were dissimilar. Specifically, in relation to the retail services in Class 35, the GC found that, following the case of Praktiker Bau, it was necessary for the goods offered for sale under the earlier mark to be precisely specified. In this case, Tulliallan’s definition stating “luxury goods” was insufficient, and the GC rejected Tulliallan’s argument that the concept of retail services also includes a shopping arcade’s services in relation to sales. On this basis, the GC dismissed the actions in their entirety. Tulliallan appealed the decision of the GC.

There was then an AG Opinion recommending that the decision be referred back to the GC, but the CJEU wished to have the final say.

CJEU Judgment

Infringement of Article 8(5) of Regulation 207/2009

The CJEU recapped the case law around Article 8(5) and reiterated that the three conditions of this Article were cumulative, so failure to satisfy one of the conditions is sufficient to stop that provision from being applied. The three conditions are (1) a link; (2) reputation of the earlier mark; and (3) a risk that use of the mark applied for without due cause would take unfair advantage of, or be detrimental to, the distinctive character or the repute of the earlier trade mark.

In its decision, the GC proceeded directly to an analysis of the third condition, ultimately finding no risk of unfair advantage, detriment to distinctive character, or detriment to the repute of the earlier trade mark. By finding that there was no risk, the GC had effectively precluded the need to examine if there was a link between the marks (since one of the cumulative conditions had not been satisfied). The CJEU found that this was not an error of law as claimed by Tulliallan.

However, the CJEU made clear that the manner in which the GC had determined that there was no risk was an error in law. As set out in the Intel case, a finding of one of the types of injury set out in Article 8(5) was to be determined on a global assessment of the factors relevant to the circumstances of the case. But the GC, in its determination, had made several references to the possible reduction in “attractiveness” of the earlier trade marks.

The CJEU made clear that such “ambiguous references” to attractiveness did not confirm beyond all doubt that there was an assessment of the risk of detriment to distinctive character or repute of the earlier trade mark, nor was it capable of proving no risk of unfair advantage. The CJEU also determined that “commercial attractiveness” did not relate directly to any of the three types of detriment in Article 8(5) of Regulation 207/2009. Therefore the Court found that the GC did not assess the evidence provided by Tulliallan in support of its Article 8(5) ground of opposition, so this ground of appeal was upheld.

Infringement of Article 8(1)(b) of Regulation 207/2009

In relation to this ground of appeal, the CJEU queried whether the GC had erred in law by relying on the judgment in Praktiker Bau in order to find that no similarity or complementarity could be established between the services covered by the earlier trade marks and the goods covered by the marks applied for.

The CJEU agreed with the GC conclusion that the concept of “retail services” would include shopping arcade services, and that the requirement derived from Praktiker Bau would apply - namely, that for retail services, it was necessary for the goods offered for sale to be precisely specified. However, the CJEU disagreed with the GC's conclusion that the absence of such a precise specification would preclude any association between those shops and the goods of the mark applied for.

Firstly, the CJEU emphasised that the authority derived from Praktiker Bau only concerned applications for trade mark registration and did not concern protection of trade marks registered at the time of the Praktiker Bau judgment. As such, Tulliallan’s three earlier UK trade marks would not be affected by the requirement for the specification of goods to which the services relate.

Secondly, the CJEU found that it could not be inferred from Praktiker Bau that the absence of a precise statement of goods which may be sold in the shopping arcade under the earlier trade mark will result in the immediate rejection of the Article 8(1)(b) ground of opposition. The CJEU stated that to do so would be to prevent the earlier trade mark being relied on to oppose later trade mark applications. This effectively suggested that the earlier trade mark has no distinctive character, which cannot be possible as the earlier trade mark is already registered and has not been declared invalid.

It would also be possible by means of a request seeking proof of genuine use of the earlier trade mark (as stated under Article 42(2) of Regulation 207/2009, and mirrored by Article 47(2) EUTMR) to determine the precise goods covered by the services for which the earlier trade mark was used, and therefore take into account only those goods for the purposes of examining the opposition.

The CJEU quashed the decision of the GC based on these errors in law made by the GC in relation to the assessment of infringement of Article 8(5) and 8(1)(b). Therefore, BF and the EUIPO were ordered bear their own costs and to pay Tulliallan’s costs in relation both to the first-instance proceedings and the procedures on appeal, in equal shares.

Comment

The CJEU judgment provides useful clarification of the Intel global assessment factors, which are not meant to be exhaustive. The CJEU’s position on attractiveness in this case makes it apparent that (in and of itself) it is not a decisive factor when considering whether a later mark takes advantage of, or is detrimental to, the distinctive character or reputation of the earlier mark.