From pillar to post: Volvo's road-trip in the opposition against Solvo

Author: Esther B. Schnepper (Institute for Information Law (IViR), University of Amsterdam)

Case T-394/10 Elena Grebenshikova v OHIM, General Court of the European Union (Third Chamber), 5 December 2013

Journal of Intellectual Property Law & Practice (2014), doi: 10.1093/jiplp/jpu036, first published online: March 25, 2014

In this recent case, the General Court of the European Union (GC) annulled the decision of the Board of Appeal of the Office for Harmonisation in the Internal Market (OHIM) concerning the opposition of Volvo against registration of the trade mark SOLVO, reasoning that there was no likelihood of confusion given the particularly high degree of attention of the relevant public and the inevitability of visual perception of the mark.

Legal context

Article 8(1)(b) of Regulation 207/2009 on the Community trade mark provides that a trade mark shall not be registered in the case of likelihood of confusion with an earlier trade mark in the territory in which the earlier mark is protected, in view of its identity with, or similarity to, the earlier mark and the identity or similarity of the goods or services covered by the trade marks. Settled case law further explains that a likelihood of confusion is constituted by either the impression of the public that the goods or services in question come from the same undertaking or by the impression that these come from economically linked undertakings. Whether there is likelihood of confusion must be assessed globally, taking into account all factors relevant to the circumstances of the case.

Facts

The present case concerns the on-going dispute between Volvo, the well-known producer of cars, and Ms Elena Grebenshikova, who wished to obtain a trade mark that contained the word SOLVO. Grebenshikova applied to register a figurative mark for ‘computer programs for warehouse management systems and computer programs for container terminal systems’ (Class 9) in 2003, whereupon Volvo filed an opposition in 2005 based on the grounds referred to in Article 8(1)(b), as Volvo's trade mark covers not only ‘vehicles’ (Class 12) but other categories such as ‘computer software’ (Class 9). The opposition was also based on Article 8(5), which provides that taking unfair advantage of the reputation of the earlier mark leads to denial of the registration. The Article 8(5) ground is not discussed further, as this case concentrated on the assessment of likelihood of confusion of Article 8(1)(b).

The opposition procedure proved to be a long journey. Initially the opposition was rejected twice, both by the Opposition Division and the Second Board of Appeal, according to which no similarity existed between the marks and consequently Article 8(1)(b) did not apply. However, in an earlier judgment of 2009 the General Court of the European Union (GC) found that the existence of phonetic similarity was sufficient for the applicability of Article 8(1)(b) and that, accordingly, a global assessment of the likelihood of confusion should be made. Subsequently, the case was referred to the First Board of Appeal, which upheld the opposition and rejected the application. The Board of Appeal reasoned that Volvo's reputation in the field of cars led up to the mark having a higher degree of distinctive character for goods such as computer software, particularly given the fact that most cars use computer software. Moreover, purchasing the software did not necessarily imply visual perception of the mark, as the software could be ordered orally. Also the decisive factor in the act of purchase would be the content rather than the visual aspect of the software. Consequently, according to the Board of Appeal, the visual differences did not outweigh the phonetic similarities and therefore likelihood of confusion did exist. In the case in question the GC evaluated the latter judgment of the Board of Appeal.

Analysis

The relevant public

First the GC considered the Board of Appeal's interpretation of the relevant public. Indeed, the product of Grebenshikova was directed exclusively to professionals in the warehouse or container terminal sector: this specialist public was correctly assumed to have a high degree of attention. However, given that purchasing the software would not happen on a daily basis, that the purchase would be a significant investment and that the software would be an essential work tool within the company, the GC found that, instead of a relatively high degree of attention, the relevant public's degree of attention should be particularly high when comparing goods from different producers operating on the market.

Likelihood of confusion

After reaffirming that there was no visual (or conceptual) but only phonetic similarity between the signs, the court assessed the likelihood of confusion. An important basic assumption regarding this assessment was that the visual, phonetic or conceptual (dis)similarities are not always of equal importance, but their weight might fluctuate according to the circumstances of the situation. In the present case, this could result in the phonetic similarity being counterbalanced by their visual dissimilarity, when the marketing of the product would necessarily involve visual perception of the mark by the public.

The GC took the view that such was the case. A purchasing specialist company is assumed to examine scrupulously the characteristics of the goods and the identity of the producers. After all, the purchase of such software entails a significant investment and a high impact on the logistical effectiveness of the company. Further, introducing new software for the logistic system would at least require installation on specialised software and training of the staff using the new system. Before deciding on the purchase of this type of software, it is therefore highly plausible that an elaborate selection process would take place, which may include visiting the producer's website, studying the written presentation of the software, having meetings with the producer's employees and using a trial version of the product. The argument that initially the software trade mark would be referred to orally, as OHIM had put forward, could not alter the conclusion of the court that visual perception of the mark before purchase of the product was inevitable. Consequently, in consideration of the particularly high degree of attention of the relevant public, the scale tipped to no likelihood of confusion and the opposition was annulled.

Practical significance

The judgment of the GC illustrates the complexity of the assessment of likelihood of confusion. Many factors are of importance, each carrying a different weight in different circumstances. The judgment reaffirms the casuistic character of the assessment, as all possible conditions in practice should be taken into consideration. Apparently the degree of attention of the relevant public can be divided into sublevels; in any case into a relatively and a particularly high attention. Further, the manner of marketing and the purchasing process should be investigated conscientiously, as the (absence of) visual or phonetic perception influences the outcome of the assessment. Apart from the legal significance this judgment also illustrates how a trade mark opposition procedure can linger for years; more than ten years have already passed since Grebenshikova filed the application. For trade mark conflicts this is not an unusual time span, but, as appropriately observed in the IPKat article ‘When Volvo met Solvo: a lesson in EU trade mark law’ (here), ten years is quite some time when compared to the life of for instance a patent or an unregistered Community design. Additionally, the results of the various instances can differ significantly, sending the parties from pillar to post. The present judgment for example has the same outcome as the initial two instances, yet on different grounds. However, this GC judgment might not be Volvo's final destination; Volvo could try its last luck at the Court of Justice of the European Union, with possibly yet another conclusion.

I say doughnut and you say dónut: why is the CTM system ‘different’

Author: Laetitia Lagarde (Studio Legale Jacobacci, Torino)

Case T-569/10 Bimbo v OHMI—Panrico (BIMBO DOUGHNUTS), General Court (Seventh Chamber), 10 October 2012

Journal of Intellectual Property Law & Practice (2013) doi: 10.1093/jiplp/jpt028, first published online: March 21, 2013

The General Court upheld the likelihood of confusion between BIMBO DOUGHNUTS and the earlier Spanish mark DOGHNUTS, thus allowing a Spanish pastry maker to prevent its competitor from using the word ‘doughnut’ for its products, on the grounds that a large part of the Spanish public does not speak English and will perceive the similar element as a fantasy word.

Legal context

According to Article 8(1)(b) of Council Regulation 207/2009 on the Community trade mark (CTMR), upon an opposition filed by the proprietor of an earlier trade mark, the trade mark applied for may not be registered if, due to the fact that it is identical or similar to an earlier trade mark and to the goods or services covered by the trade marks, there exists a likelihood of confusion by the public in the territory in which the earlier trade mark is protected.

Further, the fact that an element of a composite trade mark is in itself a trade mark with a reputation may play a part in the appraisal of the relative weight of the various components of the composite mark. Thus, if one element of a composite mark is itself a mark with a reputation, it may, by the same token, play a more important role in the composite mark.

However, the mere fact that one element of a composite mark formed of two elements plays a more important role than the other does not automatically mean that the comparison between the marks at issue can be limited to considering the former element. Indeed, it is only if all the other components of the mark are negligible that the assessment of similarity can be carried out solely on the basis of the dominant element (see Case C-334/05 OHIM v Shaker [2007] ECR I-04529).

Facts

The OHIM Opposition Division and the Board of Appeal (BoA) had upheld the opposition brought by Panrico (the ‘opponent’) against the CTM application filed by Bimbo, on the basis of Article 8(1)(b) CTMR.

The BoA noted that ‘doughnut’ was an English word meaning a ‘ring-shaped small spongy cake made of dough’. The word does not exist in Spanish, where its equivalents are ‘dónut’ or ‘rosquilla’. Thus for the average Spanish consumer (excluding those who speak English) the word ‘doughnut’ did not describe the goods in question or their qualities and did not have any particular connotation in relation to them: the earlier sign (like the applicant's mark) would be perceived as a foreign or fantasy term by most consumers.

Taking account of the average distinctiveness of the earlier trade mark, the BoA, in an overall assessment of the likelihood of confusion, concluded that owing to the average degree of visual and phonetic similarity between the signs, there was a likelihood of confusion on the part of the relevant consumers for all the goods at issue, which were found to be identical.

Bimbo appealed against the BoA decision which was dismissed by the General Court.

Analysis

Neither party disputed that the goods concerned were identical in Class 30, since the ‘pastry and bakery products, specially doughnuts’ claimed for the applied-for mark were included in the category of ‘all kinds of confectionary and pastry products’ protected by the earlier trade mark.

Regarding the comparison of the signs, the applicant claimed infringement of Article 8(1)(b) CTMR relying on two arguments: (i) the word ‘doughnuts’ is descriptive of the goods in question and has no distinctive character, even for Spanish consumers. (ii) Further, BIMBO is one of the best known trade marks in Spain: since it was the only distinctive element of the applied-for mark, there was no likelihood of confusion with the earlier mark.

As to the first argument, considering the distinctiveness of the word ‘doughnuts’, the court rejected Bimbo's arguments and evidence regarding the level of English spoken and understood by the Spanish consumer. In its view the Spanish public generally has a low degree of familiarity with the English language (see Case T–104/01 Oberhauser v OHIM—Petit Liberto, 23 October 2002).

The applicant's argument that knowledge of English in Spain is steadily increasing, particularly among young people, did not refute the fact that, according to the fairly recent study submitted by the applicant itself, almost 50 per cent of Spaniards have no command of any foreign language.

Thus the part of the relevant public which did not speak English would not realize, on seeing the word ‘doughnuts’, that ‘dónuts’ was the Spanish transcription of that word. It was therefore unnecessary to decide whether the word ‘dónut’ was regarded by the Spanish consumer as a generic term denoting doughnuts, or whether ‘dónut’ was regarded as denoting a trade mark with a reputation which belongs to the opponent.

The opponent had produced a survey of Spanish consumers which demonstrated that more than 80 per cent of the interviewees stated that they did not know the meaning of the word ‘doughnuts’. The applicant criticized that survey on the grounds that the researcher only showed the word to the interviewees but did not speak it aloud. The court found that the method employed in the survey in question was justified due to the nature of bakery and pastry products, in particular those bearing a trade mark, which are often purchased in self-service shops and are consequently bought on sight, without their trade mark being spoken aloud. The method chosen when the survey was conducted of showing the word ‘doughnuts’, without saying it, thus reflected what actually occurs in a large number of bakery and pastry product purchases.

Regarding the second argument, the BoA did not explicitly address the applicant's argument based on the reputation of the ‘bimbo’ element of the applied-for mark in the contested decision. However, the court found that the ‘doughnuts’ element in the applied-for mark ‘would catch the attention of the relevant Spanish public, as it appears unusual in Spanish due to the atypical combination of vowels “ou” and the accumulation of consonants “ghn”’. Thus the ‘doughnuts’ element could not be considered negligible in the overall impression since it was longer and the word ‘doughnuts’ would attract the Spanish public's attention because it appeared atypical in Spanish owing, in particular, to the sequence of the consonants ‘ghn’.

Thus the 'doughnuts’ element, which is nearly identical to the earlier trade mark, had an independent and distinctive role in the CTMA. Further, since the 'doughnuts’ element was wholly meaningless for that consumer, the mark applied for, BIMBO DOUGHNUTS, did not form a unitary whole or a logical unit on its own in which the ‘doughnuts’ element would be merged with the ‘bimbo’ element. The part of the relevant public which was not familiar with English would not be able to understand the sign at issue as meaning that the goods concerned were doughnuts produced by the undertaking Bimbo.

Since bakery and pastry products are everyday low-cost consumer goods, the public must be considered to have a somewhat reduced level of attention when purchasing them, and due the average degree of visual and phonetic similarity between the trade marks at issue, the BoA was correct in concluding that there was a likelihood of confusion.

Practical significance

This judgment falls within the implementation of a well-noted case in 2012 (see Case C-196/11 Formula One Licensing BV v OHIM, 24 May 2012) in which the court reiterated the coexistence between CTMs and national trade marks and found that the validity of a national trade mark may not be called into question in the opposition proceedings of a CTM.

The court had previously held in 2007 that the word ‘dónuts’ was not generic in Spain where the average consumer perceives it as distinctive sign in relation to pastries, among others goods (see T-334/04 House of Donuts v OHIM—Panrico, 18 April 2007, para 48).

Departing from the basis that it is necessary to acknowledge a certain degree of distinctiveness of a national mark on which the opposition is based, the misspelled ‘doghnut’ sign has enjoyed the same presumption of validity on the Spanish Trade Mark Register (OEPM) since 1994, as has the word ‘dónut’—first registered in 1962. Indubitably, at both the time of registration and today, no Spanish consumer would have perceived the meaning of the word ‘doughnut’ as a description for a pastry made of dough. It is unfortunate that the court did not find it necessary to consider the reputation of BIMBO, thus concluding that the earlier national right prevails, at least until cancellation proceedings are brought in Spain.