CANCELLATION No 12 161 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 partially upheld.

2.        The EUTM proprietor’s rights in respect of European Union trade mark No 4 033 742 are revoked as from 01/12/2015 for part of the contested goods, namely:

Class 3:                Soaps (except shower gels), essential oils, cosmetics (except shower gels), lotions, creams, gels (except shower gels), powders, lipsticks, antiperspirants, expressly excluding toothpaste, mouthwash and products for oral and dental care and hygiene.

3.        The European Union trade mark remains registered for all the remaining goods, namely:

Class 3:                Perfumery, shower gels, deodorants, expressly excluding toothpaste, mouthwash and products for oral and dental care and hygiene.

4.        Each party bears its own costs.

REASONS

The applicant filed a request for revocation of European Union trade mark registration No 4 033 742  (figurative mark) (the EUTM). The request is directed against all the goods covered by the EUTM, namely

Class 3:        Soaps, perfumery, essential oils, cosmetics, lotions, creams, gels, powders, lipsticks, deodorants and antiperspirants, expressly excluding toothpaste, mouthwash and products for oral and dental care and hygiene.

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 also explains that until 2011 the distribution of fragrance products under the brand was carried out by a licensee. The licence contract terminated in 2011 and the EUTM proprietor wanted then to clear the market from the brand. In December 2013 it formed a joint venture for the worldwide production and distribution of Class 3 products. It argues that the evidence sufficiently shows that preparations were made to enter the market again. It contends that the evidence dated outside the relevant period should also be taken into account as it offers indications about use of the mark within the relevant period. 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 translations has been blackened. It claims that the goods mentioned in the invoices cannot be identified and that it is not clear if they bear the contested mark. It points out that the EUTM proprietor’s comments relating to the documents are merely claims of the interested party and as such, have no probative value. 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. In any case, the documents do not show any use of the mark except for perfumery.

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. As for the extent of use, it reminds that the purpose of assessment of genuine use is not to judge the commercial success or strategy of a company.

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 was 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 07/05/2009. 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 3:        Soaps, perfumery, essential oils, cosmetics, lotions, creams, gels, powders, lipsticks, deodorants and antiperspirants, expressly excluding toothpaste, mouthwash and products for oral and dental care and hygiene.

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 the following:

• Product list showing perfumery products, deodorants and shower gels with their descriptions. The mark used on them cannot be clearly seen except for the shape of the horse with a rider as in the contested mark and illegible inscription underneath them.

• Six commercial invoices, dated between 20/08/2014 and 08/12/2015 (five of them within the relevant period), issued by Beverly Hills Polo Club FZCo. to distributors in Poland, Romania and Spain, for products described as in the product list. The amounts of products are considerable and the total amounts to pay are tens of thousands of US dollars. Further, the EUTM proprietor submitted packaging lists related to the above invoices.

• An application form (16/07/2013) and an invoice (23/01/2014) related to the participation of the EUTM proprietor at Cosmoprof exhibition in Bologna in April 2014, which, according to the EUTM proprietor, is a worldwide event for the international platform for the cosmetics and wellness industry. The invoices are accompanied by the general conditions for participating in the event and a photograph of EUTM proprietor’s stand at the event displaying a large contested mark on the wall and perfumery products in the shelves.

• Royalties reports from the EUTM proprietor’s former licensee for perfumery products described as in the product list, for 2010 and 2011. The reports show that in the above period Beverly Hills Polo Club fragrances were sold in various Member States. Within the relevant period the amounts of items sold in the EU (in Belgium, France, Greece, Spain and Italy) are negligible.

• A copy of part of a shareholders agreement, between Beverly Hills Polo Club Fragrances CV, Global Rubicon Ventures Limited and Vision Ventures Limited, signed on 26/12/2013. According to the agreement, the aim of the incorporated company is to inter alia develop, manufacture, market, advertise, promote, merchandise, ship, sell, distribute and otherwise deal with the licensed products under the licensed marks.

• A copy of a trade Mark license agreement between EUTM proprietor and Beverly Hills Polo Club FZCo., signed on 11/04/2014. According to the agreement Beverly Hills Polo Club FZCo. obtained an exclusive licence to use the marks: ,  and in connection with the licensed products from Class 3, specified as perfumes, body products and deodorants.

• The invoice dated on 31/10/2013, issued by CE.way to Beverly Hills Polo Club Fragrances CV for safety assessment of cosmetic products. The invoice is followed by a printout from www.ceway.eu, explaining that CE.way is a company providing testing and regulatory services for the cosmetic industry. The invoice is also followed by general information and product details of CPNP registration of four different Beverly Hills Polo Club Eau de Toilettes, all dated 07/05/2014 (date of the first notification).

• Several documents (press articles, preliminary report) relating to the presentation of Beverly Hills Polo Club Fragrances in Spain (from October 2015). The line’s face was the Spanish actor Jesús Castro. The documents contain photographs presenting the perfumery, bearing the contested mark in the form . The documents mention also that the perfumes are distributed by El Corte Ingles (Spain/Portugal) and inform that a launch event took place in Madrid in the presence of media to which Jesús Castro was giving interviews.

• Copies of two distribution agreements, signed between Beverly Hills Polo Club FZCo. and undisclosed entities in Romania and Poland on 18/06/2014 and 04/07/2014. According to the agreements Beverly Hills Polo Club FZCo. granted the right to distribute its products, namely perfume, body products and deodorants, in the territory of Romania and Poland.

• A presentation showing perfumery products bearing the mark is variations such as .

• Documents related to the Beverly Hills Polo Club websites and social media pages, catalogues (mostly related to clothing), a list of stores in Italy with photographs showing clothing.

Assessment of genuine use – factors

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.

Most of the relevant documents concentrate towards the end of the relevant period. The royalties’ reports from the beginning of that period (2011) show only negligible sales and no effective presence of the mark on the market is shown for 2012 and 2013. The EUTM proprietor explains this gap in use of the mark by terminating the license agreement and starting the preparatory works for new introduction of the products on the market through the newly created company. As from 2014, there is evidence of promotional activities (presence in a fair in Italy and a promotion launch of new products in Spain) and of wholesale transactions with products under the mark.

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 in 2014 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 Poland, Romania and Spain. There is evidence of promotional activities in Italy and Spain. Therefore, 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 as 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 product list, photographs, presentation, the articles 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 vast majority of the documents it is displayed on the products in the following form: in different colour variations of the background and sometimes also of the rider and the horse. 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 perceivable change in the mark, change the entire mark’s distinctive character. Admittedly, on some of the goods the typeface of the verbal elements is also altered but the Cancellation Division considers that even with the differing typeface the mark’s distinctive character remains unaltered as the verbal elements are still clearly legible and the rather prominent figurative element remains the same. In any case, the use of the mark on those products with the only change in the position of the word ‘Beverly Hills’ would still be sufficient for a conclusion on use of the mark in compliance with Article 15 EUTMR.

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 invoices show considerable amounts of products sold for significant amounts of money to entities in various countries. Although the identity of those entities was not disclosed and it is clear that they are wholesale transactions, from the other documents it becomes clear that there were actions undertaken to deliver the products to end consumers. For example, the promotional event announcing launch of a new line of products advertised by a famous Spanish actor which also informed that the products are distributed by El Corte Inglés, which is an omnipresent Spanish retail shop, is a clear indication that the products finally aim to the end consumers. Similar applies to the presence of the mark in fair in Italy, which shows an intention to promote the mark and enhance its presence on the EU market. Considering the evidence as a whole, in particular the amounts of products sold in wholesale together with the evidence documenting the additional activities to support the products on the market, 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.  

Use in relation to the registered goods and services

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 soaps, perfumery, essential oils, cosmetics, lotions, creams, gels, powders, lipsticks, deodorants and antiperspirants, expressly excluding toothpaste, mouthwash and products for oral and dental care and hygiene. However, the evidence filed by the EUTM proprietor does not show genuine use of the trade mark for all the goods for which it is registered.

According to Article 51(2) EUTMR, where there are grounds for revocation for only some of the goods or services for which the contested mark is registered, the proprietor’s rights will be revoked for those goods and services only.

The evidence refers to perfumery products, deodorants and shower gels. These products feature in the invoices, where they can be identified using the descriptions that are common to the invoices and the product list. These goods also appear in the articles relating to the promotional event in Spain and in the presentation. On the other hand, there is no indication among the evidence of any other products (from those registered) being put on the market under the contested mark.

According to case-law, when applying the abovementioned provision the following should be considered:

… if a trade mark has been registered for a category of goods or services which is sufficiently broad for it to be possible to identify within it a number of subcategories capable of being viewed independently, proof that the mark has been put to genuine use in relation to a part of those goods or services affords protection, in opposition proceedings, only for the subcategory or subcategories to which the goods or services for which the trade mark has actually been used belong. However, if a trade mark has been registered for goods or services defined so precisely and narrowly that it is not possible to make any significant sub-divisions within the category concerned, then the proof of genuine use of the mark for the goods or services necessarily covers the entire category for the purposes of the opposition.

Although the principle of partial use operates to ensure that trade marks which have not been used for a given category of goods are not rendered unavailable, it must not, however, result in the proprietor of the earlier trade mark being stripped of all protection for goods which, although not strictly identical to those in respect of which he has succeeded in proving genuine use, are not in essence different from them and belong to a single group which cannot be divided other than in an arbitrary manner. The Court observes in that regard that in practice it is impossible for the proprietor of a trade mark to prove that the mark has been used for all conceivable variations of the goods concerned by the registration. Consequently, the concept of ‘part of the goods or services’ cannot be taken to mean all the commercial variations of similar goods or services but merely goods or services which are sufficiently distinct to constitute coherent categories or subcategories.

(14/07/2005, T-126/03, Aladin, EU:T:2005:288)

While perfumery and deodorants are specifically mentioned in the list of goods, shower gels can constitute, based on their purpose, an independent subcategory of several registered goods, namely soaps, gels and cosmetics.

Consequently, the evidence shows use for perfumery products, deodorants and shower gels.

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 some of 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 perfumery products, deodorants and shower gels in Class 9.

Conclusion

It follows from the above that the EUTM proprietor has not proven genuine use of the EUTM for the following goods, for which it must, therefore, be revoked:

Class 3:        Soaps (except shower gels), essential oils, cosmetics (except shower gels), lotions, creams, gels (except shower gels), powders, lipsticks, antiperspirants, expressly excluding toothpaste, mouthwash and products for oral and dental care and hygiene.

The EUTM proprietor has proven genuine use for the remaining contested goods; therefore, the application is not successful in this respect.

According to Article 55(1) EUTMR, the revocation will take effect from the date of the application for revocation, that is, as of 01/12/2015. An earlier date, on which one of the grounds for revocation occurred, may be fixed at the request of one of the parties. In the present case, the applicant has requested an earlier date. However, in exercising its discretion in this regard, the Cancellation Division considers that it is not expedient in this case to grant this request, since the applicant has not shown sufficient legal interest to justify it.

COSTS

According to Article 85(1) EUTMR, the losing party in cancellation proceedings must bear the fees and costs incurred by the other party. According to Article 85(2) EUTMR, where each party succeeds on some heads and fails on others, or if reasons of equity so dictate, the Cancellation Division will decide a different apportionment of costs.

Since the cancellation is successful only for part of the contested goods, both parties have succeeded on some heads and failed on others. Consequently, each party has to bear its own costs.

The Cancellation Division

Pierluigi M. VILLANI

Michaela SIMANDLOVA

María Belén IBARRA DE DIEGO

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.