Court of Justice of European Union finds that all likely uses of an application mark should be considered when assessing distinctiveness in case relating to a ‘hashtag’ mark

Facts

The applicant, AS, applied to register the sign “#darferdas?” (meaning “can he do that?”) as a trade mark in Germany in respect of goods in Class 25 covering “Clothing, in particular tee-shirts; footwear; headgear”. Registration was refused on the ground that the sign was devoid of any distinctive character.

AS appealed the decision and the matter eventually reached the German Federal Court of Justice, which noted that the application mark could be used on the label sewn inside the garment as well as on the front of it. It therefore asked the CJEU whether, under Article 3(1)(b) of the Trade Marks Directive (2008/95/EC), a sign has distinctive character, “when there are in practice significant and plausible possibilities for it to be used as an indication of origin in respect of goods or services, even if this is not the most likely form of use of the sign?”

Decision

The CJEU noted that the question of whether a sign has distinctive character must be assessed by reference to both the goods or services in question and the perception of the average consumer, taking into account all relevant facts and circumstances.

The CJEU observed that a trade mark applicant does not, as at the date of application, have to indicate or even know precisely the use he/she will make of the mark applied for if registered. Even following registration of the mark, he/she has a period of five years in which to begin actual use consistent with the essential function of a trade mark.

Further, significant use may not have been made before the application date. In that situation, the examiner only has the customs of the sector concerned on which to base his/her assessment of the distinctive character of the sign.

Where it is apparent that several uses are significant in the sector concerned, the examiner must take into account all those various uses. It must also exclude those uses which, whilst being conceivable in the sector, are not practically significant and therefore seem unlikely, except where the applicant has provided concrete evidence that makes an unusual use more likely.

In this case, the referring court had found that, in the clothing industry, it is usual to place the mark on both the exterior of the goods and the labels sewn on the inside of them. It therefore identified two types of use that were practically significant within the sector. Therefore, the CJEU said, the examiner had to take those uses into consideration and assess whether the average consumer, on seeing both types of use, or at least one of them, would perceive the sign as a trade mark and, in the case of “#darferdas?”, not just a decorative element or social message.

The CJEU distinguished Case C-307/11 P Deichmann v OHIM EU:C:2012:254, which said that the assessment of distinctiveness did not require OHIM to extend its examination to uses of the application mark other than those recognised as the most likely.

Therefore, the answer to the German court’s question was that Article 3(1)(b) should be interpreted as meaning that, when examining the distinctive character of an application mark, all relevant facts and circumstances should be taken into account, including all the likely types of use of the mark applied for, which, in the absence of other indications, extends to the types of use that, in the light of the customs in the economic sector concerned, are practically significant. (Case C-541/18 AS v Deutsches Patent-und Markenamt EU:C:2019:725 (12 September 2019) — to read the judgment in full, click here).