CANCELLATION No 12 962 C (INVALIDITY)

Arpo Global Limited, Sterling House Hamlin Way Harwick Narrows Ind. Estate Kings Lynn Norfolk PE30 4NG, United Kingdom (applicant), represented by Tolfree Patents and Trade marks, Toll Drove, Manea, Cambridgeshire PE15 0JX, United Kindgom (professional representative)

a g a i n s t

Hangzhou Tianheng Machinery Co.Ltd., Ban Qiao, Lin An, Zhejian,  People’s Republic of China (EUTM proprietor), represented by Eurochina Intellectual Property Calle San Mateo 65, Local 1 “Llopis & Asociados”, 03012 Alicante, Spain (professional representative).

On 03/04/2017, the Cancellation Division takes the following

DECISION

1.        The application for a declaration of invalidity is rejected in its entirety.

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

REASONS

The applicant filed an application for a declaration of invalidity against some of the goods and services of European Union trade mark No 11 409 604 namely against some of the goods in Classes 6 and 7. The application is based on UK trade mark registration No 2 473 868, a non-registered trade mark used in the course of trade in the UK and ‘goodwill and reputation in name and business’, all connected to the sign . The applicant invoked Article 53(1)(a) EUTMR in connection with Article 8(1)(b), Article 53(1)(c) EUTMR in connection with Article 8(4) EUTMR and Article 53(2) EUTMR.

SUMMARY OF THE PARTIES’ ARGUMENTS

The applicant argues that because of the similarity of its UK trade mark registration with the contested European Union trade mark (hereinafter, ‘the EUTM’) and the similarity of the goods covered by both registrations, there exists a likelihood of confusion on the part of the public in the United Kingdom. It claims, in particular, that both trade marks share the dominant textual element STRONGHOLD which is very distinctive in light of the dictionary definition provided by the applicant. As regards the comparison of the goods, the applicant considers that its staples are complementary to stapler machines, which can be manually, pneumatic or electronically operated. In turn, staplers are commonly sold with other handheld power tools in Class 7. As a result, the contested hand tools in Class 7 are similar to the applicant’s goods. In addition, the contested boxes/chests for tools in Class 6 are ancillary products to hand tools. The relevant public would expect them to be supplied by one single supplier.

As regards the applicant’s second ground, it claims that the use of the contested EUTM would be preventable under the common law tort of passing off, in particular Section 5(4)(a) UK-Trade Mark Act 1994. In this regard, the applicant indicates that it has been using the trade mark STRONGHOLD in a stylised form in the UK prior to the filing of the contested EUTM. It submits four brochures with marketing materials, allegedly to have been distributed in the UK and within other EU countries. It contends that the evidence shows that the trade mark has been used in relation to staplers, including plier staplers, hammer tackers, and pneumatic pliers.  In addition, it explains that it only sells its goods to distributors as it can be seen with a quick Google search of the terms STRONGHOLD and STAPLES. Consequently, the use of the sign is of more than mere local significance.

Focusing on the requirements of a passing-off claim (goodwill, misrepresentation and damage), the applicant argues that it has a significant goodwill in the mark STRONGHOLD, that the use of the contested EUTM in the UK provides a false representation because as a result of the similarity of the goods the public will be deceived or likely to be deceived on the origin of the goods and that this is likely to damage the applicant.

Finally, the applicant contends that its property right in the goodwill and reputation of its business and the associated common law tort in the UK of passing off that refers to the wrongful invasion of that property right also constitutes an earlier right per se under Article 53(2) EUTMR.

In support of its observations, the applicant filed the following evidence:

• Oxford English Dictionary definition of stronghold, as “a place strongly fortified against attack, a secure place of refuge or retreat”;
• Google hits for ‘stronghold staples’ of 13/05/2016;
• Excerpts from four catalogues from the company ‘Southgate’ dated Oct-Dec 2008;Jan-Mar 2009; Oct-Dec 2011; and Oct-Dec 2012 showing stapler products (including pneumatic pliers and hammer takers) under the figurative sign ‘STRONGHOLD’.

The EUTM proprietor did not submit observations in reply.

LIKELIHOOD OF CONFUSION — ARTICLE 53(1)(a) EUTMR IN CONNECTION WITH ARTICLE 8(1)(b) EUTMR

A likelihood of confusion exists if there is a risk that the public might believe that the goods or services in question, under the assumption that they bear the marks in question, come from the same undertaking or, as the case may be, from economically linked undertakings. Whether a likelihood of confusion exists depends on the appreciation in a global assessment of several factors, which are interdependent. These factors include the similarity of the signs, the similarity of the goods and services, the distinctiveness of the earlier mark, the distinctive and dominant elements of the conflicting signs and the relevant public.

1. The goods

The relevant factors relating to the comparison of the goods or services include, inter alia, the nature and purpose of the goods or services, the distribution channels, the sales outlets, the producers, the method of use and whether they are in competition with each other or complementary to each other.

The goods on which the application is based are the following:

Class 16:        All variations and styles of carton and box staples, and all other forms of both industrial and domestic staples.        

The contested goods are the following:

Class 6:        Tool chests of metal, empty; Tool boxes of metal, empty.        

Class 7:        Hand-held tools, other than hand-operated.

Contested goods in Class 6

The contested goods tool chests of metal, empty; Tool boxes of metal, empty are metal containers for storing tools. The applicant’s goods consist of staples. Staples are small pieces of bent wire that are used for holding sheets of paper together firmly or for fastening carton or boxes. In order to put staples into the paper or carton, a machine (normally a stapler) is used. As indicated in the applicant’s specification, staples can be used for domestic purposes (like any other office supplies or for DIY purposes) but also for industrial purposes, for instance for packaging purposes.

The applicant claims that staples are similar to the contested goods in Class 6 to the extent that, first, staples are complementary to staplers and, secondly, staplers are sold with other hand tools and thirdly, manufacturers of hand tools sell ancillaries such as metal tool boxes and chests.

The Cancellation Division cannot retain the applicant’s arguments as a sound basis or finding the goods similar. The goods in conflict present a different nature, method of use and serve different purposes. They are not complementary or in competition, since they vary in price and function differently, mechanically and electrically.

Admittedly, it cannot be excluded that major distributors of tools and specialised hardware outlets for DIY offer both staples to be used with staplers and tool boxes and chests. However, these goods cannot be found normally next to each other in view of their different purpose. Tool boxes and chests will be found in the section for storing and organisation items whilst staples will be found either in the section of articles for crafts or office supplies together with household staplers or in the section of tools for packaging and binding, next to the heavier-duty type of staplers. Moreover, even if this latter type of staplers may be found in hardware outlets next to other hand-held tools, it has to be noted that the earlier trade mark is only protected for staples, and not for staplers. Finally, the applicant has not adduced any evidence which would show that manufacturers of staples or staplers also produce tool chests and boxes. The goods are therefore dissimilar.

Contested goods in Class 7

The contested hand-held tools, other than hand-operated include all sorts of power tools such as drills, sanders or saws. As above indicated, according to the applicant, staplers are commonly sold using the same distribution channels as other handheld power tools, to the extent that staples are sold with staplers, they will be sold next to these power tools. It should be noted that the applicant does not argue that staplers and hand-held tools, other than hand-operated share the same producers.

The Cancellation Division cannot agree with the applicant’s argument to find the goods similar. As above noted, the applicant’s specification is restricted to various types of staples. It does not cover therefore tools. Even if staples may be complementary to staplers, it does not follow that they are similar to power tools. In addition, it is far from evident that staplers (which are commonly hand-operated tools) are normally sold with power tools. Whilst in specialised outlets all sorts of tools may be found, this does not necessarily lead to similarity. As a result the goods are dissimilar.

Conclusion

According to Article 8(1)(b) EUTMR, the similarity of the goods or services is a condition for a finding of likelihood of confusion. Since the goods are clearly dissimilar, one of the necessary conditions of Article 8(1)(b) EUTMR is not fulfilled, and the application must be rejected insofar it is based on Article 53(1)(a) EUTMR in conjunction with Article 8(1)(b) EUTMR ground.

NON-REGISTERED MARK OR ANOTHER SIGN USED IN THE COURSE OF TRADE (Article 53(1)(c) EUTMR in conjunction with Article 8(4) EUTMR)

In relation to Article 53(1)(c) EUTMR in conjunction with Article 8(4) EUTMR, the application is based on the non-registered trade mark used in the course of trade in United Kingdom for staples, staplers, staple guns, hammer tackers, pneumatic pliers and protected under the common law tort of passing-off.

Pursuant to Article 53(1)(c) EUTMR, a European Union trade mark shall, on request to the Office, be declared invalid where there is an earlier mark as referred to in Article 8(4) EUTMR and the conditions set out in that paragraph are fulfilled.

According to Article 8(4) EUTMR, upon opposition by the proprietor of a non registered trade mark or of another sign used in the course of trade of more than mere local significance, the trade mark applied for shall not be registered where and to the extent that, pursuant to the European Union legislation or the law of the Member State governing that sign:

(a)        rights to that sign were acquired prior to the date of application for registration of the European Union trade mark, or the date of the priority claimed for the application for registration of the European Union trade mark;

(b)        that sign confers on its proprietor the right to prohibit the use of a subsequent trade mark.

Therefore, the grounds of refusal of Article 8(4) EUTMR are subject to the following requirements:

• the earlier sign must have been used in the course of trade of more than local significance prior to the filing of the contested trade mark;

• pursuant to the law governing it, prior to the filing of the contested trade mark, the applicant acquired rights to the sign on which the application is based, including the right to prohibit the use of a subsequent trade mark;

• the conditions under which the use of a subsequent trade mark may be prohibited are fulfilled in respect of the contested trade mark.

These conditions are cumulative. Therefore, where a sign does not satisfy one of those conditions, the application for declaration of invalidity based on a non registered trade mark or other signs used in the course of trade within the meaning of Article 8(4) EUTMR cannot succeed.

Prior use in the course of trade of more than mere local significance

The condition requiring use in the course of trade is a fundamental requirement, without which the sign in question cannot enjoy any protection against the registration of a European Union trade mark, irrespective of the requirements to be met under national law in order to acquire exclusive rights.

Furthermore, such use must indicate that the sign in question is of more than mere local significance. The rationale of this provision is to restrict the number of conflicts between signs by preventing an earlier sign which is not sufficiently important or significant from challenging either the registration or the validity of a European Union trade mark.

Rights falling under Article 8(4) EUTMR may only be invoked if their use is of more than mere local significance. The proprietors of rights the use of which is of mere local significance retain their exclusive rights under the applicable national law pursuant to Article 111 EUTMR.  The question whether the use of a non-registered sign is of more than mere local significance will be answered by applying a uniform European standard (18/04/2013, T 506/11 & T-507/11, Peek & Cloppenburg, EU:T:2013:197, § 19, 47-48).

In the present case, the invalidity applicant must show the earlier sign’s use in the course of trade of more than local significance by the filing date of the contested EUTM, that is, 21/01/2013. Moreover, the applicant also has to prove that the sign was used in the course of trade of more than local significance at another point in time, namely at the time of filing of the invalidity request, that is, 13/05/2016. This condition stems from the wording of Article 53(1)(c) EUTMR, which states that an EUTM will be declared invalid ‘where there is an earlier right as referred to in Article 8(4) and the conditions set out in that paragraph are fulfilled’ (decisions of 05/10/2004, 606 C, and 03/08/2011, R 1822/2010-2, Baby Bambolina (fig.), § 15).

The evidence submitted by the applicant consists of excerpts from four catalogues from the company ‘Southgate’ dated Oct-Dec 2008;Jan-Mar 2009; Oct-Dec 2011; and Oct-Dec 2012 showing stapler products (including pneumatic pliers and hammer takers) under the logo  ‘STRONGHOLD’.

The evidence filed by the applicant is dated long before the time of filing of the invalidity request (13/05/2016). It therefore does not provide any information on actual use of the sign in the United Kingdom by such date, let alone of use of more than mere local significance.

The applicant’s indication that further evidence of use can be provided if required does not alter the above conclusion. It is for the applicant to put forward, on its own motion and not at the Office’s request, the relevant facts, arguments and evidence in support of its claim.

Considering all the above, it has to be concluded that the applicant failed to prove use in the course of trade of the non-registered mark  ‘STRONGHOLD’ (fig.) in the United Kingdom within the relevant period. Consequently, the application has to be rejected insofar as it is based on Article 53(1)(c) EUTMR in conjunction with Article 8(4) EUTMR.

OTHER EARLIER RIGHTS (Article 53(2) EUTMR)

In relation to Article 53(2) EUTMR, the application is based, according to the request for invalidity, on ‘goodwill and reputation in name and business’ in the United Kingdom regarding the sign . It argues that its property right in the goodwill and reputation of its business and the associated common law tort in the United Kingdom of passing off that refers to the wrongful invasion of that property right constitutes an earlier right per se under Article 53(2) EUTMR.

Article 53(2) EUTMR applies only where the rights invoked are of such a nature that they are not considered typical rights to be invoked in cancellation proceedings under Article 53(1) EUTMR (decision of 13/12/2011, 4 033 C, § 12).

The arguments put forward by the applicant as regards the alleged existence of ‘other earlier right’ clearly show that in reality the applicant is invoking the same earlier right invoked under Article 53(1)(c) EUTMR in conjunction with Article 8(4) EUTMR. The applicant itself cross-refers to the arguments developed in support of the Article 8(4) EUTMR claim in order to sustain the Article 53(2) EUTMR claim. Both are based on the protection of a non-registered trade mark under the common law tort of passing off.

The Cancellation Division considers that as far as an invoked earlier right (here the non-registered trade mark protected under the UK laws of passing-off) falls under the rights usually covered in Article 8(4) EUTMR, Article 53(2) CTMR does not apply to said sign. Article 53(2) EUTMR applies only where the invoked rights are of such nature that they are not considered typical rights to be invoked in opposition proceedings under Article 8 EUTMR (see in this regard decision of  24/11/2008, 380 C, ‘TELESIS’, § 27, and of 26/03/2009 2371 C, ‘MECAMIDI’, § 58). 

 

In light of the foregoing, the applicant’s claim based on Article 53(2) EUTMR must be rejected.

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) 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

Michaela SIMANDLOVA

Elisa ZAERA CUADRADO

José Antonio GARRIDO OTAOLA

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.