Case T-498/10 David Mayer Naman v OHIM, Daniel & Mayer Srl, General Court of the European Union, 8 March 2013
Journal of Intellectual Property Law & Practice (2013), doi: 10.1093/jiplp/jpt115, first published online: June 25, 2013
The General Court held that requests under Articles 54(2) (acquiescence) and 57(2) and (3) (proof of genuine use) of the Community Trade Mark Regulation (CTMR), made for the first time before the court and the Board of Appeal, were inadmissible, as out of time. Assessing the likelihood of confusion between an earlier national mark and a Community trade mark, the court provided useful guidance on how to assess visual, phonetic and conceptual differences, with particular regard to the relevant public's perception of names of foreign origin.
Legal context and facts
Six years later, the Italian company Daniel & Mayer Srl applied for a declaration of invalidity for both Classes, for likelihood of confusion, under Articles 52(1)(a) and 8(1)(b) of Regulation 40/94 (now Articles 53(1)(a) and 8(1)(b) of Regulation 207/2009, the Community Trade Mark Regulation (CTMR)), with the earlier national trade mark DANIEL & MAYER MADE IN ITALY, registered in Italy in 1981 for goods in Class 25. A second plea called for the relative ground for invalidity of Article 52(1)(c).
The Cancellation Division declared the CTM registration invalid, in light of Articles 52(1)(a) and 8(1)(b) of Regulation 40/94, in relation to all the goods in Class 25 and some of those in Class 18. The CTM owner appealed, arguing that (i) the proprietor of the earlier mark had not proved genuine use under Article 57(2) CTMR, (ii) the goods produced by the two companies were destined for different markets, (iii) the word ‘Mayer’ was scarcely distinctive and there were relevant phonetic, visual and conceptual differences, to avoid any risk of confusion and (iv) the marks had coexisted peacefully for several years.
The First Board of Appeal upheld the Cancellation Division's judgment, finding that (i) the appellant's request for proof of genuine use was out of time, as he had not invoked Article 57(2) CTMR at first instance, (ii) the items in Class 25 were identical, while some of those in Class 18 were similar, (iii) the similarities between the conflicting marks were sufficient to give rise to a likelihood of confusion and (iv) the suggestion of peaceful coexistence was ruled out by the existence of on-going lawsuits between the parties and failure to invoke Article 54(2) CTMR.
David Mayer Naman challenged the Board of Appeal's decision before the General Court, asserting violation of Articles 54(2), 57(2) and (3) and 8(1)(b) CTMR.
The first claim called for the application of Article 54(2) CTMR, alleging that the proprietor of the earlier national trade mark had acquiesced, for more than five consecutive years, to the use of the later Community trade mark. The court noted that Article 48(2) of the Rules of Procedure of the General Court precluded the examination of this claim, since it was raised only at the hearing. Moreover, the plea had not been asserted during proceedings before OHIM and was therefore inadmissible, in light of Articles 65(2) and 76 CTMR, as the court's scrutiny is limited to the facts, evidence and arguments brought by the parties during the previous proceedings and to the matters of law examined in those proceedings (Case T-57/03 SPAG SAS v OHIM  ECR II-00287).
The second plea alleged violation of Articles 57(2) and (3) CTMR, contesting the Board of Appeal's rejection of the request for proof of genuine use, raised for the first time before it, as being made out of time. The applicant argued that the Board should have distinguished between a request aimed at a partial revocation with erga omnes effects and a corresponding exception with inter partes effects, aimed at excluding the risk of confusion between the conflicting marks. The General Court recited Rules 40(6), 22(1) and 20(2) of Commission Regulation 2868/95, stating that the request should be made ‘expressly and timeously’ to OHIM, before the Opposition or Cancellation Division, and cannot be brought, for the first time, before the Board of Appeal (Case T-364/05 Saint-Gobain Pam v OHMI  ECR II-00757).
‘This case law’, the court explained, ‘relies on the fact that the proof of genuine use, or the lack thereof, is capable of affecting the content of the proceeding for declaration of invalidity and thus represents a preliminary question, to be decided before the rest of the application’. Its effect is to shift the burden of proof of genuine use (or of the existence of proper reasons for non-use) to the party applying for the declaration of invalidity, upon pain of having its application dismissed. In light of Article 135(1) CTMR, and the principle of continuity of functions, the Board of Appeal cannot rule on a new preliminary question.
The third plea contested the application of Article 8(1)(b) CTMR. The General Court first noted that ‘likelihood of confusion’ refers to the risk that ‘the public might believe that the goods or services in question come from the same undertaking or … from economically-linked undertakings’ (Case T-162/01 Laboratorios RTB SL v OHIM  ECR II-02821), and presupposes that both the marks and the goods concerned are identical or similar (Case T-316/07 Commercy AG v OHIM  ECR II-00043). The assessment is to be conducted globally, taking into account the similarities between the marks and between the goods or services, as well as the interdependence of these factors, from the perspective of an average consumer. The evaluation of visual, phonetic or conceptual similarities is based on the signs' overall impression, and their distinctive and dominant components.
The court upheld the Board of Appeal's findings on the relevant public, identified in the average buyer of clothes in Italy. Although the applicant had maintained that the products were destined to different markets (men's clothing, for DAVID MAYER; women's and gay-friendly clothing, for DANIEL & MAYER), the General Court noted that the registrations referred indistinctly to a male or female public, and that the applicant's argument presupposed the inadmissible request for proof of genuine use. Further, it clarified that the level of attention exhibited towards certain marks in the fashion sector does not arise from the nature of the goods sold, but rests upon the marketing efforts made by the companies (Case T-522/08 Ruiz de la Prada de Sentmenat v OHIM, 13 September 2011).
Pleas contesting the comparison of the products were also dismissed. First, the court examined the alleged violation of the duty to state reasons, established by Article 75 CTMR and Rule 50(2)(h) of Regulation 2868/95: the requisite, identical to that of Article 296 TFEU, externalizes the justification for an act or measure, allowing judges to review its legality, and the parties to protect their rights. Although the reasons stated in the contested decision were succinct, the judges found that, in light of the principle of continuity of the functions, it was possible to take into account the reasons adduced by the Cancellation Division, which formed integral part of the legal context of the appeal.
The evaluation of the identity and similarity of the goods was deemed correct. The court noted that, where the goods covered by the earlier mark include the goods covered by the CTM, those goods are considered to be identical (Case T-29/04 Castellblanch SA v OHIM  ECR II-05309). Where, instead, ‘there is a close connection between them, in the sense that one is indispensable or important for the use of the other in such a way that customers may think that the responsibility for the production of those goods lies with the same undertaking’, they are complimentary, and therefore similar (Case T-443/05 El Corte Inglés SA v OHIM  ECR II-02579). Accordingly, items in Class 18 were deemed similar to those in Class 25, as ‘[g]oods such as shoes, clothing, hats or handbags may, in addition to their basic function, have a common aesthetic function by jointly contributing to the external image (“look”) of the consumer concerned’.
The applicant brought further challenges to the assessment of visual, phonetic and conceptual similarities. First, it was argued that the surname ‘Mayer’ was widely diffused in Italy, and thus inherently non-distinctive. The court, however, observed that the applicant had been able to identify just eight marks containing that word, registered or listed in commercial registers or databases, and only one company that effectively used it in the Italian fashion market. The number was insufficient to demonstrate diffusion in the relevant market. Further, the applicant should have given proof of the effective presence of the sign in the market, as evidence of registration or enlistment, as well as proof of use as surname or company name, is insufficient to this aim.
Tackling the visual comparison, the General Court focused on the identity of the second word and the similarity of the first words (which begin with ‘Da’ and have a comparable length), holding that ‘when comparing a denominative sign and a figurative one, even if the first element of each of the conflicting sign is not identical, the presence of a common element does not allow to deny the existence of a certain degree of visual similarity’ (Case T- 433/09 TTNB v OHIM  ECR II-00115). The ‘&’ sign, as a common typographical sign, and the words ‘MADE IN ITALY’, merely descriptive of the origin of the goods, could not exclude similarity (Case T-11/09 Özdemir v OHIM  ECR II-00021). Phonetic differences were also deemed insignificant, as the relevant public pronounces the words ‘Daniel’ and ‘David’ in a similar way, and the word ‘&’ does not distract from the dominant elements.
From a conceptual point of view, the applicant argued that his mark referred to a single physical person, whereas the earlier mark identified two people who jointly sold clothes in Italy. The court held that, in the perception of the relevant public, both signs consist of a personal name, followed by a surname. Although the word ‘mayer’ is actually a Jewish name (an Ashkenazic form of the name Meïr), the relevant public understands it as a surname of Germanic origin, moderately diffused in Italy. The analysis of the origin of this name traced back to the Talmudic era and to its use in the Jewish community of Tripoli, but the court concluded that the relevant public would be ignorant of these facts. The names ‘Daniel’ and ‘David’ share the same Jewish origin and are perceived as personal names. In light of these findings, and the insignificance of the linking element ‘&’, the judges recognized the signs' similarity (see Case T-11/09 for ‘James Jones’ and ‘JACK & JONES’).
The Board of Appeal, therefore, had correctly established the likelihood of confusion. Arguments concerning the notoriety of the applicant's CTM were dismissed, as only the reputation of the earlier mark is relevant in the assessment of the signs' similarity (Case C-498/07 P, Aceites del Sur-Coosur SA v Koipe and OHIM  ECR I-07371). The court added that the assessment of the likelihood of confusion ‘cannot be dependent on marketing intentions, whether implemented or not, which are by their very nature subjective’ (Case T-363/06 Honda Motor Europe Ltd v OHIM  ECR II-02217). Concerning the alleged peaceful coexistence of the marks for decades, the judges observed that the applicant had not provided the necessary evidence; to the contrary, the parties had admitted that they were involved in several lawsuits.
On the habitual use of patronymics as marks in the fashion industry, it was noted that consumers do not generally believe that there is an economic link between all the proprietors of marks containing a widely diffused surname (such as ‘Rossi’—see Case T-169/03 Sergio Rossi v OHIM  ECR II-00685). However, the court stated that this was not the case in relation to the name ‘Mayer’, scarcely diffused within the relevant public (such as ‘Fusco’—Case T-185/03 Fusco v OHIM  ECR II-00715). The likelihood of confusion is higher in relation to foreign names, as consumers are more sensitive to small differences when dealing with signs express in their national language.
This articulated case highlights the importance of deploying all the defences, asserting all the relevant facts and providing all the required evidence, from the beginning of OHIM proceedings. The court rejected the applicability of Articles 54(2) (acquiescence) and 57(2) and (3) (proof of genuine use), first asserted by the applicant before, respectively, the General Court and the Board of Appeal.
‘[T]he purpose of actions brought before the General Court is to review the legality of decisions of the Boards of Appeal’ (Case T-109/11 Apollo Tyres AG v OHIM ): in light of Article 65 CTMR, the perimeter of the court's competence coincides with that of the action brought before the Board of Appeal. According to settled case law (Case C-412/05 P Alcon Inc v OHIM  ECR I-03569), ‘[t]he applicant does not have the power to alter … the terms of the dispute, as delimited in the respective claims and allegations’ submitted by the parties (exceptions: (i) production of documents as evidence of accuracy or inaccuracy of a matter of common knowledge—Case T-357/10 Kraft Foods v OHIM ; (ii) amplification of an earlier plea—Case C-412/05P; (iii) applicability of Article 48(2) of the Rules of Procedure). Similar considerations apply to the Board of Appeal's competence, in light of Article 135(1) CTMR. Practitioners should therefore devote the utmost attention to producing factual evidence (including evidence of national law when required -see Case T-579/10 macros consult GmbH v OHIM, 7 May 2013), and asserting all their defences, from the outset.
Concerning the burden of proof, the court stated that, in relation to the diffusion of names in national territories, it is necessary to prove their actual presence in the market, as registration or enlistment in commercial registers and databases is insufficient to demonstrate a reduced risk of confusion. Actual evidence is also needed to prove peaceful co-existence. Further, the comparison of products cannot take into account the actual use of the sign for part of the goods for which it was registered, unless a request for proof of genuine use is made.
The assessment of the likelihood of confusion falls into line with previous case law. The judgment clarified that, when dealing with names of foreign origin, it is crucial to assume the perspective of the relevant public, which may ignore or be less sensitive to their meanings and differences. Small differences may not be sufficient to avoid the risk of confusion, as the threshold is higher than that applied in the case of signs familiar to the public. Right holders wishing to contend the applicability of these principles should support their claims with solid and direct evidence of the relevant public's actual perception.