April 1, 2015
Judgment in Apple and Pear Australia Ltd., Star Fruits Diffusion v Office for Harmonisation in the Internal Market (Trade Marks and Designs), Carolus C. BVBA, Judgment of the General Court (Fourth Chamber), Case T-378/13, EU:T:2015:186, 25 March 2015.
The General Court has decided that in the context of opposition proceedings, although OHIM has a duty to consider the decisions of Community trade mark courts in parallel infringement proceedings concerning the same parties and the same marks, it is not bound to follow them.
Council Regulation (EC) No 207/2009 on the Community trade mark (the “Regulation”) stipulates which decision making bodies have jurisdiction to decide various matters relating to CTMs. In particular, Article 96 of the Regulation provides that Community trade mark courts are to have exclusive jurisdiction for inter alia, infringement actions and counterclaims for revocation of CTMs. However, under the Regulation, OHIM has jurisdiction to adjudicate upon applications for registration of a CTM. Consequently, it is possible for opposition and infringement proceedings to proceed in parallel even though they concern the same parties and the same marks.
Carolus C. BVBA (“Carolus”) is a Belgian tree nursery specialising in apple trees. On 13 October 2009, Carolus applied to register the word mark ENGLISH PINK as a CTM for goods in class 31, including agricultural products and fresh fruits. An application for an identical Benelux mark was also filed by Carolus on the same date and was subsequently granted.
Apple and Pear Australia Ltd. and Star Fruits Diffusion (the “Opponents”) use PINK LADY in connection with the sale of a particular variety of apple, called Cripps Pink. On 20 April 2010, the Opponents opposed Carolus’ application to register ENGLISH PINK as a CTM on the basis of three prior CTMs which were registered for goods that were largely identical to the goods for which ENGLISH PINK was proposed to be registered. These CTMs were:
- The word PINK LADY registered on 27 February 2003; and
- Two separate figurative marks featuring the words “Pink Lady”, which were registered on 15 December 2005 and 30 July 2008 (shown below).
Shortly thereafter, on 8 June 2010, the Opponents commenced infringement and revocation proceedings against Carolus before the Tribunal de commerce de Bruxelles (the “Brussels Commercial Court”). The Brussels Commercial Court delivered its judgment on 28 June 2012. As regards the strength of the Opponents’ marks, the court took the view that PINK LADY was not descriptive since apples are not pink and, on the basis of evidence adduced by the Opponents and common knowledge, PINK LADY had a substantial reputation. It held that there was a likelihood of confusion between ENGLISH PINK and PINK LADY and it ordered Carolus to refrain from infringing the Opponent’s CTMs throughout the European Union. It also invalidated Carolus’ Benelux ENGLISH PINK mark.
Following this decision, the Opponents wrote to OHIM a number of times to draw its attention to the ruling of the Brussels Commercial Court. In a letter of 29 August 2012, the Opponents informed OHIM that Carolus had acquiesced in the judgment and that it was therefore final.
However, in a decision dated 29 May 2013, the Fourth Board of Appeal rejected the Opponents’ opposition to the registration of ENGLISH PINK based on their prior CTM rights in PINK LADY. Surprisingly, the Board of Appeal made no mention of the decision of the Brussels Commercial Court, despite having been made aware of it on a number of occasions. Furthermore, its analysis on the likelihood of confusion between the two marks was very different to that of the Brussels Commercial Court. For example, the Board of Appeal observed that the “pink” element of PINK LADY was non-distinctive because apples “may oscillate into shades of pink” and it took the view that the Opponents had not adduced sufficient evidence in support of their argument that PINK LADY had a reputation.
The Opponents appealed to the General Court on the basis that the Board of Appeal should have considered the decision of the Brussels Commercial Court and delivered a ruling that was compatible with that decision.
Should the Board of Appeal have taken the Brussels Decision into account?
The General Court noted that the decision of the Brussels Commercial Court was, prima facie, “a relevant factual element for resolving the case at hand”. It went on to state that, “The Board of Appeal could not fail to recognise that there were essential common points between the factual aspects at issue in the infringement proceedings initiated and the opposition proceedings brought to contest the registration of the mark sought. Not only were the parties to both sets of proceedings identical, but also the earlier word mark relied on in support of the infringement proceedings before the Brussels Commercial Court was the same as the one relied on in support of the opposition proceedings before the various departments of OHIM. Moreover, the Benelux mark ENGLISH PINK, annulment of which was ordered by that court, and the mark sought were highly similar.” It was also relevant that the decision had been made by a Community trade mark court established under the Regulation and that the Regulation was intended to guarantee uniform protection of a CTM throughout the European Union.
Accordingly, the General Court held that the Board of Appeal should have assessed the impact of the Brussels Commercial Court’s decision in the present case. Furthermore, the Board of Appeal had infringed Article 75 of the Regulation for failing to state reasons for the inferences to be drawn from that decision. The General Court held that these failures constituted grounds for annulment of the Board of Appeal’s decision.
The General Court also considered whether, under the principle of res judicata, the Board of Appeal was bound by the decision of the Brussels Commercial Court. In this respect, the General Court made the following points:
- Board of Appeal decisions must be assessed solely on the basis of the Regulation and not on the basis of earlier judicial decisions;
- While the Regulation does explicitly deal with the application of res judicata in some specific scenarios, the Regulation does not contain any provision by which OHIM is bound by a decision of a Community trade mark court delivered in an action for infringement when it exercises its exclusive jurisdiction over the registration of CTMs in the context of CTM opposition proceedings;
- The requirement of unitary character of the CTM does not mean that res judicata applied to the situation in question;
- The subject matter and causes of action of the proceedings were different. The action for infringement before the Brussels Commercial Court concerned the validity of the Benelux mark ENGLISH PINK (under Benelux law) and a request for a pan-European injunction on the basis of the Opponents’ CTMs (under Articles 9(1)(b) and 9(1)(c) of the Regulation). However, the proceedings before OHIM concerned opposition to the registration of ENGLISH PINK as a CTM (under Articles 8(1)(b) and 8(5) of the Regulation); and
- Carolus’ Benelux mark and the CTM it applied for were two legally distinct marks. The judgment of the Brussels Commercial Court had the effect of protecting the Opponents’ earlier word mark only against the effects of the Benelux mark ENGLISH PINK.
For these reasons, the General Court held that the principle of res judicata did not attach to the judgment of the Brussels Commercial Court in the context of the OHIM opposition proceedings.
This decision is unsatisfactory for brand owners who rely on a prior CTM in order to prevent a third party from using and registering as a CTM a later identical or similar sign. The Board of Appeal’s decision illustrates how it is possible for a trade mark proprietor to enforce its CTM and obtain from a Community trade mark court a pan-European injunction against a third party infringer but leaves that same proprietor powerless if OHIM does not consider itself bound by that decision and proceeds to register as a CTM the “infringing” sign. The relevant infringer is left with a registered CTM which it cannot use and which presumably will be vulnerable to revocation after a period of 5 years of non-use due to the effect of the injunction.
The one positive aspect of this decision is that OHIM has a duty to at least consider and set out the inferences that it draws from such decisions of Community trade mark courts. However, this case constitutes aexcellent example of how OHIM and national courts can take very different approaches to the same factual circumstances and essentially the same legal tests that apply to infringement and opposition scenarios. Unfortunately, there is no guarantee that parties to parallel infringement and opposition proceedings will not be subject to similar conflicting decisions in the future.