CANCELLATION No 12 162 C (REVOCATION)

Lane IP Limited, 2 Throgmorton Avenue, London EC2N 2DG, United Kingdom (applicant), represented by Lane IP Limited, 2 Throgmorton Avenue, London EC2N 2DG, United Kingdom (professional representative)

a g a i n s t

Lifestyle Equities C.V., Prins Bernhardplein 200, 1097 JB Amsterdam, Netherlands (EUTM proprietor), represented by Novagraaf Nederland B.V., Hoogoorddreef 5, 1101 BA Amsterdam, Netherlands (professional representative).

On 25/07/2017, the Cancellation Division takes the following

DECISION

1.        The application for revocation is rejected in its entirety.

2.        The applicant bears the costs, fixed at EUR 450.

REASONS

The applicant filed a request for revocation of European Union trade mark registration No 532 895  (figurative mark) (the EUTM). The request is directed against all the goods covered by the EUTM, namely

Class 14:        Watches.

The applicant invoked Article 51(1)(a) EUTMR.

SUMMARY OF THE PARTIES’ ARGUMENTS

The applicant argues that the mark was not put to genuine use for a continuous period of five years.

The EUTM proprietor submits documents to prove use of the mark. It argues that the application is inadmissible because the applicant did not provide any facts and evidence in support of the application. It contends that Beverly Hills is a location filled with celebrities and millionaires and few places can surpass such aspirations. It goes on to explain the fondness of Moghuls for polo and concludes that this is a sport of kings. The mark was established in 1982 using these images of material wealth and exclusion of people not belonging to a private club and it became an immediate success in the USA. The EUTM proprietor’s products are available around the world and are promoted by licensees. The EUTM proprietor submits that the mark as registered is its principal mark but that the mark has been used also in minor variations none of which alters the distinctiveness of the mark as registered. The EUTM proprietor explains the relevance of the individual pieces of evidence. It points out that watches are only one part of the diversified portfolio of products offered under the mark, that they are not products of everyday consumption but rather more luxurious goods. It concludes that the evidence is sufficient to prove genuine use of the mark in relation to all the contested goods and the application should be rejected.

The applicant refutes the EUTM proprietor’s arguments as to the admissibility of the application. As regards the evidence submitted, the applicant argues that the mark as shown in the documents alters the distinctive character of the contested mark as registered. Furthermore, the applicant contests the probative value of the evidence, in particular in view of the fact that most of the information identifying the parties of the transactions has been blackened and that some evidence originates from the EUTM proprietor itself. Many of the documents are not dated or do not relate to watches. Overall, the evidence, according to the applicant, does not prove sufficient extent of use of the mark within the EU, in the relevant time period and in the form as registered.

The EUTM proprietor maintains its position and considers the arguments of the applicant to be largely irrelevant or incorrect. It gives examples from the Office’s Guidelines of trade marks that were accepted as used as registered.

Preliminary remark

Admissibility of the application

The EUTM proprietor argues that the application is not admissible because the applicant did not submit facts and evidence as required by Rule 37(b)(iv) EUTMIR. While the applicant submitted statement of grounds and arguments in support of its application (in particular it claimed that the mark has not been put to genuine use for a continuous period of five years and should be revoked pursuant to Article 51(1)(a) EUTMR), it is not obliged to file facts and evidence in support of its arguments in the present case. Rule 37(b)(iv) EUTMIR is a common requirement for all applications for revocation and declarations of invalidity. However, the facts and evidence requirement does not apply to application for revocation based on non-use as the applicant cannot be forced to demonstrate a negative fact, namely that the EUTM proprietor has not been using the mark. In applications based on Article 51(1)(a) the burden of proof is reversed and it is the EUTM proprietor who has to demonstrate use of the mark. Consequently, this EUTM proprietor’s argument must be set aside.

GROUNDS FOR THE DECISION

According to Article 51(1)(a) EUTMR, the rights of the proprietor of the European Union trade mark will be revoked on application to the Office, if, within a continuous period of five years, the trade mark has not been put to genuine use in the Union for the goods or services for which it is registered, and there are no proper reasons for non-use.

Genuine use of a trade mark exists where the mark is used in accordance with its essential function, which is to guarantee the identity of the origin of the goods or services for which it is registered, in order to create or preserve an outlet for those goods or services. Genuine use requires actual use on the market of the registered goods and services and does not include token use for the sole purpose of preserving the rights conferred by the mark, nor use which is solely internal (11/03/2003, C-40/01, Minimax, EU:C:2003:145, in particular § 35-37 and 43).

When assessing whether use of the trade mark is genuine, regard must be had to all the facts and circumstances relevant to establishing whether commercial exploitation of the mark is real, particularly whether such use is viewed as warranted in the economic sector concerned to maintain or create a market share for the goods or services protected by the mark (11/03/2003, C-40/01, Minimax, EU:C:2003:145, § 38). However, the purpose of the provision requiring that the earlier mark must have been genuinely used ‘is not to assess commercial success or to review the economic strategy of an undertaking, nor is it intended to restrict trade-mark protection to the case where large-scale commercial use has been made of the marks’ (08/07/2004, T-203/02, Vitafruit, EU:T:2004:225, § 38).

According to Rule 40(5) EUTMIR in conjunction with Rule 22(3) EUTMIR, the indications and evidence for the furnishing of proof of use must consist of indications concerning the place, time, extent and nature of use of the contested trade mark for the goods and services for which it is registered.

In revocation proceedings based on the grounds of non-use, the burden of proof lies with the EUTM proprietor as the applicant cannot be expected to prove a negative fact, namely that the mark has not been used during a continuous period of five years. Therefore, it is the EUTM proprietor who must prove genuine use within the European Union, or submit proper reasons for non-use.

In the present case the EUTM was registered on 03/06/1999. The revocation request was filed on 01/12/2015.  Therefore, the EUTM had been registered for more than five years at the date of the filing of the request. The EUTM proprietor had to prove genuine use of the contested EUTM during the five-year period preceding the date of the revocation request, that is, from 01/12/2010 to 30/11/2015 inclusive, for the following contested goods:

Class 14:        Watches.

On 10/05/2016 the EUTM proprietor submitted evidence as proof of use.

As the EUTM proprietor requested to keep certain commercial data contained in the evidence confidential vis-à-vis third parties, the Cancellation Division will describe the evidence only in the most general terms without divulging any such data.

The evidence to be taken into account is, in particular, the following:

• Sales reports of unknown origin showing sales of thousands of watches between 2012 and 2015 in various countries of the EU. The mark  is displayed at the top corner of the reports.

• Printouts from websites showing watches labelled with the mark  (www.bhpcwatches.com, including printouts using Wayback Machine, EUTM proprietor’s Facebook and Instagram page, www.airberlin-shop.de, www.scorpioworldwide.com, www.goldenbrands.gr).

• An undated catalogue displaying watches bearing the mark  , including code numbers used in the invoices (see below).

• Invoices dated between 2012 and 2015 issued by redacted entities to several companies with addresses in the UK, France and Sweden. The products are described as BHPC watches and include codes under which the products can be found in the catalogue. By way of example, the invoice No 2540 dated 30/01/2015 contains, inter alia, watches BH-544, BH-545 and BH-547 which are displayed in the catalogue in the following manner .

• Invoices dated between 2012 and 2015 issued by Scorpio Distributers and Brand Avenue Ltd to a few entities in the United Kingdom, Denmark, the Czech Republic and Poland for, among other things, BHPC watches.

Assessment of genuine use – factors

Preliminary remark

The evidence submitted by the EUTM proprietor to demonstrate use of the mark includes sales reports of unknown origin. The EUTM proprietor claims that they are royalty report summaries concerning royalties for watches by licensees to the EUTM proprietor.

It is noted that documents coming from the sphere of the owner of the mark (drawn up by the interested parties themselves or their employees) are generally given less weight than independent evidence. This is because the perception of the party involved in the dispute may be more or less affected by personal interests in the matter (decision of 11/01/2011, R 0490/2010-4, BOTODERM, § 34; decisions of 27/10/2009, B 1 086 240 and of 31/08/2010, B 1 568 610). Such a statement cannot in itself sufficiently prove genuine use (judgment of 9/12/2014, T-278/12, PROFLEX, EU:T:2014:1045, § 54) However, this does not mean that such statements are totally devoid of all probative value (judgment of 28/03/2012, T-214/08, Outburst, EU:T:2012:161, § 30).

The final outcome depends on the overall assessment of the evidence in each individual case. In general, further material is necessary for establishing evidence of use, since such statements have to be considered as having less probative value than physical evidence (labels, packaging, etc.) or evidence originating from independent sources. Therefore, the probative strength of the further material submitted is very important. An assessment should be made of whether the content of the evidence originating in the interested party itself is sufficiently supported by the further material (or vice versa). The fact that the national office concerned may adopt a certain practice in assessing such kind of evidence of use does not mean that it is applicable in the proceedings concerning European Union trade marks (judgment of 07/06/2005, T-303/03, Salvita, EU:T:2005:200, § 41 et seq.).

In the present case, as will become evident from the assessment below, the Cancellation Division considers that the additional evidence supports the information given in the sales reports and provides sufficient indications as regards use of the mark in relation to the relevant goods in the relevant period as to render the data given in the sales reports plausible.

Time of use

The evidence must show genuine use of the European Union trade mark within the relevant period, that is, from 01/12/2010 to 30/11/2015.

The sales reports show sales of products between 2012 and 2015. This is supported by the invoices which are dated in the same years. Some of the website printouts using the internet archive service Wayback Machine also show dates within those years. All in all, most of the documents fall within the relevant period.

Bearing in mind that only trade marks whose genuine use was interrupted for a continuous period of five years are subject to the sanctions provided for in Article 15(1) EUTMR, it is sufficient for avoiding these sanctions that a trade mark was genuinely used for only part of this period (16/12/2008, T-86/07, Deitech, EU:T:2008:577, § 52 and 09/07/2009, R 623/2008-4, Walzer Traum (fig.) / Walzertraum (fig.), § 28).

Consequently, the use made of the mark between 2012 and 2015 is sufficient to demonstrate that the mark was used in the relevant period.

Place of use

The evidence must show that the contested European Union trade mark has been genuinely used in the European Union (see Article 15(1) EUTMR and Article 51(1)(a) EUTMR).

The invoices show sales of the products to the United Kingdom, France, Sweden, the Czech Republic, Poland and Denmark. Some of those sales are to distributors. Moreover, further invoices issued by those distributors (Scorpio and Brand Avenue) show resale of the goods to retailers. The invoices reinforce the information given in the sales reports which indicate sales to various countries within the EU. The use of the mark not only relates to the relevant territory but was spread in several different parts of it. Therefore, the Cancellation Division considers that place of use was sufficiently proven.

Nature of use: use as a trade mark

Nature of use requires, inter alia, that the contested European Union trade mark is used as a trade mark, that is, for identifying origin, thus making it possible for the relevant public to distinguish between goods and services of different providers.

The catalogue and even the invoices show that the mark was used directly on the products to identify their commercial origin. Consequently, the sign was used as a trade mark.

Nature of use: use of the mark as registered

‘Nature of use’ in the context of Rule 22(3) EUTMIR further requires evidence of use of the mark as registered, or of a variation thereof which, pursuant to Article 15(1)(a) EUTMR, does not alter the distinctive character of the contested European Union trade mark.

The purpose of Article 15(1)(a) EUTMR, which avoids imposing strict conformity between the form in which the trade mark is used and the form in which it was registered, is to allow its proprietor, when exploiting it commercially, to vary it in such a way that, without altering its distinctive character, enables it to be better adapted to the marketing and promotion requirements of the goods or services concerned (23/02/2006, T-194/03, Bainbridge, EU:T:2006:65, § 50).

The mark was registered in the following form: . In the majority of the documents, in particular in the catalogue and the website printouts it is displayed on the products in the following form: .  The only perceptible variation is the position of the verbal elements. Such variation of the mark from the form as registered does not alter the distinctive character of the mark. All the elements of the mark, both figurative and verbal, are present. The figurative element retains all the perceivable features of the registered figurative element, namely the running horse with the same leg position carrying a rider / polo player with a stick over his head. The verbal elements are also present, the only difference being the position of the words. The inscription ‘Beverly Hills’ placed above the figurative element is still present in the mark as used, the mere difference being its move to the position below the figurative element. However, the particular positioning of the words ‘Beverly Hills’ does not, within the mark as a whole, give to the mark any particular distinctive character. The replacement of these words to the bottom of the mark does not, without any other perceptible change in the mark, change the entire mark’s distinctive character.

Consequently, it is considered that the mark was used in compliance with Article 15 EUTMR.

Use in relation to the registered goods

Article 51(1)(a) EUTMR and Rule 22(3) EUTMIR require that the EUTM proprietor proves genuine use for the contested goods and services for which the European Union trade mark is registered.

The contested EUTM is registered for watches. The evidence shows that the mark has been used for these goods. The invoices refer to watches, watches are displayed in the catalogues and websites and also the sales reports relate to watches. Moreover, as explained above in the list of evidence submitted, the watches mentioned in the invoices can be identified with the watches in the catalogue, by cross checking the codes from the invoices and the catalogue. Therefore, there is no doubt that the evidence relate to watches labelled with the contested mark, that is, to all the goods for which the mark is registered.

Extent of use

Concerning extent of use, it is settled case-law that account must be taken, in particular, of the commercial volume of the overall use, as well as of the length of the period during which the mark was used and the frequency of use (e.g. 08/07/2004, T-334/01, Hipoviton, EU:T:2004:223, § 35).

The Court has held that ‘[u]se of the mark need not … always be quantitatively significant for it to be deemed genuine, as that depends on the characteristics of the goods or service concerned on the corresponding market’ (11/03/2003, C-40/01, Minimax, EU:C:2003:145, § 39).

The sales reports show several thousand watches sold within various EU Member States between 2012 and 2015. The invoices do not show these amounts of products sold but they show not insignificant amounts sold to the distributors who then, as is evident from the distributors’ invoices, sold the goods by smaller quantities to different retailers. As mentioned above, characteristics of the goods as well as other circumstances of the case have to be taken into account. In the present case, watches, although not being exceptionally expensive, are not typical products of everyday consumption and are purchased rather infrequently, therefore, even smaller quantities of products sold may be sufficient to prove genuine use of the mark. It is also noted that the purpose of assessment of use is not to judge the commercial success or business strategy of the owner of the mark but rather to ascertain whether or not the mark was used with a genuine intention to secure an outlet for the goods. In the present case, moreover, use was demonstrated for rather varied territories within the EU, during several years, with certain regularity.

Considering the evidence as a whole, the Cancellation Division concludes that it demonstrates sufficiently that use of the mark was genuine, that is, aiming at creating and preserving an outlet for the goods, as opposed to a mere token use the only purpose of which is to preserve the trade mark rights. Consequently, the extent of use was sufficiently proven.  

Overall assessment

In order to examine, in a given case, whether use of the earlier mark is genuine, an overall assessment must be made taking account of all the relevant factors in the particular case. That assessment implies a certain interdependence between the factors taken into account. Thus, a low volume of goods marketed under that trade mark may be compensated for by high intensity of use or a certain constancy regarding the time of use of that trade mark or vice versa (08/07/2004, T-334/01, Hipoviton, EU:T:2004:223, § 36).

It was demonstrated that the mark had been used in relation to the registered goods during the relevant period in the relevant territory to an extent sufficient to indicate that the use was genuine. It was used as a trade mark and in a form not altering the distinctive character of the mark as registered. Considering all the above, the Cancellation Division concludes that the evidence, as a whole, is sufficient to demonstrate that the contested mark was genuinely used during the relevant period in the relevant territory for watches in Class 14.

Conclusion

It follows from the above that the EUTM proprietor has proven genuine use for all the contested goods. Consequently, the application for revocation must be rejected as unfounded.

COSTS

According to Article 85(1) EUTMR, the losing party in cancellation proceedings must bear the fees and costs incurred by the other party.

Since the applicant is the losing party, it must bear the costs incurred by the EUTM proprietor in the course of these proceedings.

According to Rule 94(3) EUTMIR and Rule 94(7)(d)(iv) EUTMIR, the costs to be paid to the EUTM proprietor are the representation costs, which are to be fixed on the basis of the maximum rate set therein.

The Cancellation Division

María Belén IBARRA DE DIEGO

Michaela SIMANDLOVA

Robert MULAC

According to Article 59 EUTMR, any party adversely affected by this decision has a right to appeal against this decision. According to Article 60 EUTMR, notice of appeal must be filed in writing at the Office within two months of the date of notification of this decision. It must be filed in the language of the proceedings in which the decision subject to appeal was taken. Furthermore, a written statement of the grounds of appeal must be filed within four months of the same date. The notice of appeal will be deemed to be filed only when the appeal fee of EUR 720 has been paid.

The amount determined in the fixation of the costs may only be reviewed by a decision of the Cancellation Division on request. According to Rule 94(4) EUTMIR, such a request must be filed within one month from the date of notification of this fixation of costs and shall be deemed to be filed only when the review fee of EUR 100 (Annex I A(33) EUTMR) has been paid.