Anheuser-Busch fails to revoke Budvar trademarks

In Budejovicky Budvar Narodni Podnik v Anheuser-Busch Inc, the Court of Appeal has upheld two UK trademark registrations for stylized versions of the words 'Budweiser Budbräu' and 'Bud' belonging to Czech brewers Budejovicky Budvar (BB). US brewers Anheuser-Busch had applied to revoke the trademarks for non-use.

BB's BUDWEISER BUDBRÄU trademark registration featured the word 'Budweiser' in gothic script, positioned over 'Budbräu' written in a larger, embellished, flowing font. This mark was registered for beer, ale and porter. BB's BUD registration consisted of the word 'Bud' in a cursive script and was registered in relation to various types of drink.

Anheuser-Busch brought an application for revocation of BB's marks on the grounds that BB had not made genuine use of them within the meaning of Section 46 of the UK Trademarks Act 1994. BB conceded that it had never used the BUDWEISER BUDBRÄU and BUD marks in the United Kingdom in the registered stylizations. Instead, it submitted that use of the words 'Budweiser Budbräu' in block capitals on the neck labels of its beer bottles and use of the word 'Bud' in upper case dot matrix lettering on boxes used for the import and sale of its beer in the United Kingdom amounted to genuine use under Sub-section 46(2) of the act. This sub-section provides that, for the purposes of revocation proceedings, use of a trademark includes use "in a form differing in elements which do not alter the distinctive character of the mark in the form in which it was registered".

At first instance, hearing officers at the UK Trademarks Registry dismissed Anheuser-Busch's applications for revocation, holding that the words 'Budweiser Budbräu' and 'Bud' were the distinctive features of the respective registrations. The fact that BB had not used the fonts and embellishments set out in the registrations did not significantly detract from or add to those distinctive features. Thus, there had been genuine use of the registered marks.

The High Court reversed the decision on appeal. The court concluded that the hearing officers had applied the wrong test - focusing too much on the average consumer's reaction to the mark, rather than the registrar's expert consideration of which elements make up the distinctive character of the marks. BB appealed to the Court of Appeal.

The Court of Appeal held that the hearing officers had not erred in principle in reaching their conclusions. They had assessed the distinctive character of the marks through the eyes of the registrar and had not erred in considering that the registrar would take into account how the marks would be perceived by the average consumer. Although the conclusions were perhaps "surprising", it could not be said that no reasonable hearing officer could have reached them. The original decisions were therefore upheld.

The House of Lords, the United Kingdom's highest court, rejected Anheuser-Busch's petition for appeal without comment.

For discussion of a ruling in favour of Anheuser-Busch in New Zealand, see Anheuser-Busch wins Budweiser dispute on appeal.

Anna Carboni and Jane Cornwell, Linklaters, London