Current Intelligence - Showdown! General Court annuls the annulment of the ‘Winnetou’ trade mark

In our latest issue, Editorial Board member Birgit Clark (Baker & McKenzie LLP) discusses the judgment of the General Court in Case T-501/13 Karl-May-Verlag v OHIM. The dispute concerned the registrability of the word sign "WINNETOU" (a fictional character created by the renown German writer Karl May) as a Community trade mark (now EUTM). 

Showdown! - General Court annuls the annulment of the ‘Winnetou’ trade mark

Birgit Clark
Baker & McKenzie LLP
Email: birgit.clark@bakermckenzie.com

General Court of the European Union, Karl-May-Verlag v OHIM (WINNETOU), T-501/13, 18 March 2016

The General Court of the European Union upheld an appeal by publishing house Karl-May-Verlag GmbH against the EU Intellectual Property Office’s decision, then called OHIM, to annul the former’s Community trade mark WINNETOU, confirming that the Office should not have granted the application for a declaration of invalidity brought by Constantin Film Produktion GmbH without assessing, independently, whether the sign Winnetou was descriptive for the goods and services covered. 

Legal context 

Article 7(1)(c) of Regulation (EC) No 207/2009 (Regulation) lists absolute grounds for refusal of registration and, inter alia, provides that:[the] following shall not be registered: (…)(b) trade marks which are devoid of any distinctive character;(c) trade marks which consist exclusively of signs or indications which may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods or of rendering of the service, or other characteristics of the goods or service. 

Article 52 Regulation provides that the trade mark ‘shall be declared invalid on application to the Office or on the basis of a counterclaim in infringement proceedings where tit has been registered contrary to the provisions of Article 7 [Regulation]’. Article 75 Regulation stipulates that ‘[d]ecisions of the Office shall state the reasons on which they are based. They shall be based only on reasons or evidence on which the parties concerned have had on opportunity to present their comments’. 

Facts 

Karl May (25 February 1842–30 March 1912) was a German writer best known for his adventure novels set in the American Old West. Many of May’s works have enjoyed enduring popularity in Germany and beyond and have been adapted for film and stage. One of May’s most famous protagonists is the fictional character Winnetou, who over the last two decades has been the subject of numerous copyright, trade mark and work title disputes, mostly in German courts. 

In 2003 German company Karl-May-Verlag GmbH registered the sign WINNETOU as a Community trade mark for various goods and services in Classes 3, 9, 14, 16, 18, 21, 24, 25, 28–30, 39 and 41–3. In 2010 film production company Constantin Film Produktion GmbH brought an application for a declaration of invalidity against the trade mark, arguing that the sign was both descriptive and non-distinctive for the broad specification covered. Constantin Film Produktion GmbH requested that registration should thus be declared invalid in its entirety on the basis of Articles 7 and 52(1)(a) CTMR. 

While OHIM’s Cancellation Division rejected the application for a declaration of invalidity, the Board of Appeal (‘Board’) took a different view and annulled the contested trade mark as being descriptive and non-distinctive for all goods and services covered, except for ‘printers’ type’ and ‘printing blocks’ in Class 16. 

On the question of ‘descriptiveness’, the Board found that Winnetou was a major character in a series of novels by the late German author Karl May and one of the main protagonists films and plays. Therefore, the relevant German consumer would understand the sign Winnetou as reference to this particular fictional Native American character. Notably, the Board based its argument on several earlier decisions by German national courts, including a widely reported decision by the German Federal Court of Justice (I ZB 19/00 of 2002), concerning the same mark. 

The Board followed the German courts’ assessment that in the context of goods and services such as films, printed matter, photographs, entertainment services and exploitation of industrial property rights, the sign Winnetou was descriptive since the relevant consumer would associate them with the character Winnetou. The remaining goods and services—with the narrow exception of ‘printers’ type’ and ‘printing blocks’ in Class 16—could all be categorized as ‘merchandising’ which would equally be associated with the fictional character Winnetou. 

Analysis 

On further appeal by Karl-May-Verlag GmbH the General Court annulled the Board of Appeal’s decision, focusing on two main reasons: firstly, the Board had infringed the principles of autonomy of the Community trade mark system and, secondly, the Board had failed to properly reason its decision with regard to the consumer perception of the sign and the categories of goods and services covered. 

Weight of the German courts’ decisions 

The General Court took the view that, by treating decisions of German courts as binding, the Board had infringed the principles of autonomy and independence which govern the Community trade marks system. Notably, instead of assessing—independently and afresh—whether the sign ‘Winnetou’ was descriptive for the goods and services covered, the Board treated the earlier decisions by various German courts, which had deemed the sign as descriptive, as binding and also based its finding of the sign’s lack of distinctive character on the assessment of the German courts. 

The Office had argued that it had taken the German case law into account because it dealt with the same mark, came from a higher national court, related to partly identical goods and services and had been handed down shortly after the contested mark was filed. It also stressed that the Board’s decision did not rely on just one earlier judgment, but four German court decisions, and thereby demonstrated that there was settled case law. 

The General Court disagreed and found that it was clear that the Board had treated the German court decisions not only as possessing an indicative value and thus as evidence in the context of the assessment of the facts of the case, but as binding precedents with regard to the registrability of the Winnetou trade mark registration. The judges explained (at para 45) that ‘[in] the present case, the Board of Appeal is not criticised for taking into consideration the decisions of the German courts, but for having taken the view that it was bound by those decisions, which is contrary to the case-law cited … and is not called into question by OHIM’s argument’. 

Insufficient reasoning by the Board 

Secondly, the General Court held that the Board had failed to give sufficient reasons for the perception of the sign beyond its concrete meaning as an evocation of a fictional character. Particularly, the Board had failed to ‘carry out any specific analysis to establish that the sign WINNETOU, beyond its concrete meaning as an evocation of a fictional character, was perceived by the relevant public as referring to the concepts of “Native American” and “Native American Chieftain”.’ Consequently, the contested decision was inadequately reasoned with regard to the perception of the sign. 

Further, the court rejected the Office’s argument that the general public regarded ‘Winnetou’ films, books or theatre representations as books or films about Native Americans, so that the sign WINNETOU would be perceived as linked more generally to the theme of ‘Native American’ and ‘Native American Chieftain’. The judges explained with reference to the court’s precedent CFCMCEE v OHIM (T-405/07 and T-406/07, ECR, EU:T:2009:164, para 69) that even if proved, this could not mitigate the lack of reasoning in the contested decision since the Office ‘is not allowed, in the course of the proceedings, to advance supplementary reasons for a decision vitiated by a defective statement of reasons under Article 296 TFEU’. 

Regarding the relationship between the contested mark and the specification covered, the judges found that the Board’s reasoning in relation to the descriptive character of the sign concerning a large variety of goods (including perfumery, jewellery, stationery, textiles and meats) which the Board had broadly grouped together under the heading ‘merchandising’ goods, was ‘excessively general and abstract’ and lacked a ‘specific analysis’ of their respective nature and characteristics. The Board had held that for these ‘merchandising’ goods, the sign Winnetou indicated that the goods were connected to the Winnetou films or the book character whereby consumers would assume that they are ‘Winnetou’ advertising goods but would not regard the sign as an indicator of trade origin. In this context the court referred to its precedent in Zuffa LLC v OHIM (T-118/06) and found that these goods did not constitute a homogeneous category, since they there was no sufficiently direct and specific link between them. Consequently, the reasoning of the Board’s decision did not meet the requirements of Article 75 CTMR, since it did not enable the court to conduct an effective review of the contested decision. 

Practical significance 

Since the court has annulled the Board’s decision, the Office must now reassess the application for a declaration of invalidity brought by Constantin Film Produktion GmbH, taking into account the grounds of the court’s judgment. 

While this decision saves the Winnetou trade mark for the time being and serves as a reminder to the Office to follow the mantra of always assessing all evidence afresh, this does not at the same time mean that Karl-May-Verlag GmbH will be able to prevent third parties from producing mere reprints of Karl May’s classic Winnetou novels since May’s works have been in the public domain since 1963. Nevertheless, the German Federal Court of Justice decided in 2003 (I ZR 171/00 of 23 January 2003 ‘Winnetous Rückkehr’) that so called ‘work title protection’ under Article 15 German Trade Mark Act will continue even where the copyright in a work has already expired. In order to avert an extension of copyright protection via trade mark laws, however, neither trade mark, nor work title protection should allow Karl-May-Verlag GmbH to prevent third-party reprints of the Winnetou novels, bearing in mind that the title of a novel is meant to distinguish the works but will not be seen as an indication of trade origin in the trade mark sense. This notwithstanding, the Karl-May-Verlag GmbH publishing house should—according to another recent court decision by the Regional Court Nürnberg-Fürth (HK O 1164/15 of 23 December 2015)—be able prevent film adaptations of the original Winnetou works in cases where these substantially change the protagonist’s life story when compared to the original storyline(s). 

In light of this flurry of case law and conflicting IP rights, it appears safe to say that whatever the Office will now decide in the Winnetou trade mark case, there is a good chance that Winnetou will be at the centre of further court cases and interested parties are well advised to plan carefully before making further adaptations of the noble chieftain’s life.

© The Author(s) (2016). Published by Oxford University Press. All rights reserved.