One of the main aims of the EU Trademark Directive of 2008 was to ensure a reasonable degree of approximation among the trademark laws of EU member states. Before the entry into force of this directive, the trademark laws applicable in the member states contained disparities that were detrimental to the internal market, competition and the free movement of goods and services.
The directive prohibits the use of a sign where that use takes unfair advantage of, or is detrimental to, the distinctive character or the repute of a trademark. A trademark owner may prevent any use of its trademark that reduces its distinctiveness. This proscription protects trademarks not only against blurring, tarnishing, and dilution but also against freeriding.
Freeriding takes place when unauthorised use of a trademark is made without creating confusion or misrepresentation as to source of goods or services, but which nonetheless takes unfair advantage of a trademark. In practice, lookalikes are designed to mimic the name or get-up of a brand without confusing customers; typically these lookalike products only bring the established brand to mind but can be easily distinguished from that brand. Of great concern to brand owners are, in fact, imitation techniques that illegitimately take advantage of their brands’ name, reputation or prestige.
Lookalikes are designed to mimic the name or get-up of a brand without confusing customers
EU legislation on trademarks captures unfair freeriding on another brand’s reputation, even in the absence of harm to consumers or the earlier brand. In a recent decision, the EU’s General Court considered this particular aspect of trademark infringement.
It dealt with an objection filed by Coca-Cola against an application submitted by a Syrian company for the registration of a figurative sign as a Community trademark with the Office for Harmonisation of the Internal Market (OHIM). The sign consisted of a stylised logo including the word ‘Master’ with an Arabic word above it. The Syrian company sought to cover a number of classes for a range of food and beverage products, including cola-flavoured soft drinks.
Coca-Cola’s objection claimed that the label, marking and packaging of Master Cola were similar to its brand, which is protected by a number of trademark registrations in Europe, including various stylised representations of its logo. It claimed that this similarity caused a likelihood of confusion and the use of the Master Cola sign would take unfair advantage of, and be detrimental to, the repute of the Coca-Cola trademarks.
Following the OHIM’s decision that rejected Coke’s arguments on the basis that the marks were dissimilar and therefore was no likelihood of confusion, Coca-Cola took the matter before the General Court. The Court’s ruling took a different view from that of the OHIM, highlighting instead the importance of trademark protection for the stylised elements of a trademark and not simply the words when assessing similarity.
Although generally the verbal elements of trademarks have stronger distinguishing power, the General Court took into account the graphic elements and visual impression portrayed by the logo’s style on the product. It considered that consumers may be affected more by the impression created by a product’s image than by the actual wording on the packaging or the labelling. The Court placed particular significance on the way such products are sold: when products are purchased off supermarket shelves where the consumers select the product, the visual similarity is of more consequence than aural or conceptual similarity.
This ruling establishes that the use of certain stylistic elements may be sufficient to create a link between two marks and an application for registration of a lookalike can be opposed based on a claim of freeriding or tarnishing of a reputed trademark.
jgrech@demarcoassociates.com
Josette Grech is an adviser on EU law at Guido de Marco & Associates.