ABSENTA BAR mark declared valid after challenge by previous Absenta Bar owner

Spain

On October 1 2014 Section 15 of the Barcelona Court of Appeal, which specialises in IP cases, upheld the validity of the ABSENTA BAR trademark, registered in Class 43 of the Nice Classification, which had been challenged by the owner of a local traditional business called Absenta Bar. The invalidation action was based on bad-faith registration and likelihood of confusion, on the grounds that the name of the business was a prior well-known unregistered mark.

The dispute arose between the owner of the figurative mark ABSENTA BAR, who had used it to identify his bar in the Barcelona suburb of Barceloneta since 2006, and the owner of another Absenta Bar located in the Raval area of the city. Both areas are popular with tourists from all over the world.

The owner of the Raval bar claimed that his establishment had opened in the 19th century and was taken over in 1934 by a French citizen who sold only absinthe ('absenta' in Spanish). Having reached its peak of popularity during the 1960s, the bar had become iconic and well known throughout Barcelona, he argued. The establishment had been closed from 2006 to mid-2011.

The owner of the Barceloneta bar had operated his business under that name since at least early 2006, and in November 2010 had applied to register the Spanish trademark ABSENTA BAR in Class 43 (restaurant services, bars, coffee shops, canteens, self-service restaurants and temporary accommodation). Registration was granted in March 2011.

In April 2012 the trademark owner sent a cease and desist letter to the owner of the Raval bar requesting that he cease using the name 'Absenta Bar' to identify his business. No response was received and the trademark owner subsequently filed suit for trademark infringement.

The defendant counterclaimed for invalidation of the ABSENTA BAR trademark on the following grounds:

  • The mark had been registered in bad faith as, given the popularity of the Raval bar, the applicant could not have been unaware of its existence; and
  • ABSENTA BAR was a prior well-known unregistered mark which he owned and which invalidated the registered trademark.

The court of first instance found the ABSENTA BAR trademark to be invalid and dismissed the infringement action brought by its owner.

The court of appeal revoked the first-instance decision on the following grounds.

Bad faith must have existed at the time the application was filed and must be assessed taking into account all relevant factors, as the European Court of Justice (ECJ) confirmed in its judgment of June 6 2009 (Chocoladenfabriken Lindt & Sprüngli (Case C-529/07)).

According to Supreme Court case law:

  • bad faith must be assessed both objectively, in light of the standard of conduct that is socially demanded, and subjectively, because good faith is a situation of excusable ignorance; and
  • a typical situation of bad faith is where the applicant seeks to win consumers' approval by taking advantage of the reputation of a well-known sign.

The court considered that it had not been proved that Raval's Absenta Bar was generally known by the city's residents - even those within the restaurant sector - to the extent of being a reference point in Barcelona society. Instead, knowledge of the bar was limited to the area of Raval, to locals and to regular clients. Nor was it proven that the applicant was linked to the Raval zone.

Therefore, it could not be concluded that the applicant knew or should have known of the sign used by the Raval bar owner.

The court also took into account that, at the time the application was filed, Raval's Absenta Bar had been closed for five years. The court stated that this fact weakened the legal protection that the bar owner might otherwise have invoked. According to the court, it also diluted the argument of the applicant's bad faith, as he might even have thought that the sign had been abandoned.

Finally, the court rejected the invalidation action based on the previous unregistered well-known trademark ABSENTA BAR, for the reasons set out above - that is, that knowledge of the sign beyond locals and regulars had not been proven.

The court added that it understood the "mixed feelings" of the Raval bar owner, having invested in a traditional business that was recognised by locals and had a loyal clientele. However, it stated that the trademark owner enjoyed protection under the law, having taken the initiative to register a trademark without bad faith. The court emphasised that neither the bar's previous owners nor the defendant had been sufficiently diligent to register the sign as a trademark, and that the rights of the trademark owner must therefore prevail.

Having rejected the invalidation counterclaim, the court upheld the plaintiff's claim and ordered the defendant to cease using the name 'Absenta Bar' or 'Bar Absenta', to remove it from signboards and advertising and to pay compensation for damages to the plaintiff.

Pablo Martí, Grau & Angulo, Barcelona

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