CTM applicant cannot rely on possibly unlawful act committed to someone else’s benefit

In 1872 Holdings vof v Office for Harmonisation in the Internal Market (OHIM) (Case T-207/13), the General Court has dismissed Dutch liquor trader 1872 Holdings vof’s action against OHIM. 1872 Holdings claimed that both the First Board of Appeal and the Cancellation Division of OHIM had wrongfully decided that 1872 Holdings’ Community trademark (CTM) for the word mark THE SPIRIT OF CUBA was invalid.

1872 Holdings registered its CTM for goods and services in Classes 33, 35 and 42 of the Nice Classification for, among other things, "alcoholic beverages, namely rum and rum-based alcoholic beverages", "retailing of alcoholic drinks" and "consultancy in the field of alcoholic beverages".

On March 9 2011 the opponent, Havana Club International SA, applied to OHIM for a declaration that the CTM was invalid. The Cancellation Division granted the application, holding that the CTM was registered in breach of Article 7(1)(c) of the Community Trademark Regulation (207/2009). In particular, it held that THE SPIRIT OF CUBA was descriptive of the goods and services for which it was registered. The Board of Appeal upheld this decision.

1872 Holdings appealed. It raised a single plea in law before the General Court, alleging infringement of Article 7(1)(c) of the regulation. The General Court rejected 1872 Holdings’ objections.  

The General Court first found that the word 'spirit', under at least one of its meanings, designated an "alcoholic spirit or alcoholic beverage’". Thus, the Board of Appeal had correctly found that the expression 'the spirit of Cuba' would be understood, by the relevant (English-speaking) public, as a reference to an alcoholic spirit from Cuba. The fact that dictionaries indicate that the term 'spirit', as a designation of alcoholic beverages, is usually used in the plural form, did not alter this conclusion. 

As a consequence, the General Court held that the Board of Appeal was fully entitled to conclude that the CTM was descriptive for the purposes of Article 7(1)(c) and was thus invalid.

Further, the General Court underlined that this conclusion was not altered by 1872 Holdings’ arguments that:

1. the mark THE SPIRIT OF CUBA had been registered in the United States and the United Kingdom; and
2. numerous word marks having the same structure as, or a structure similar to, that of the CTM had been registered by OHIM.

Unsurprisingly, the court dismissed 1872 Holdings’ first argument by referring to the autonomous nature of the CTM regime, which applies independently of any national system (Messe München v OHIM (electronica) (Case T-32/00 P)). Accordingly, the General Court found that the question of whether a sign is eligible for registration as a CTM must be answered by reference only to the relevant Community rules. OHIM and the courts of the European Union are not bound by decisions given in member states or third countries.

Regarding 1872 Holdings’ second argument, the General Court - not surprisingly either - held that the question of whether a sign is eligible for registration as a CTM must be assessed solely on the basis of the Community Trademark Regulation, as interpreted by the courts of the European Union, and not on the basis of any previous practice of the Boards of Appeal (BioID v OHIM (Case C-37/03 P)).

Referring to settled case law of the Court of Justice of the European Union, the General Court held that, when examining an application for registration of a CTM, OHIM should, in the light of the principles of equal treatment and sound administration, take into account previous decisions in similar applications (Agencja Wydawnicza Technopol v OHIM (Case C-51/10 P)).  

The General court noted, however, that it also follows from this case law that the way in which these principles are applied must be consistent with respect for legality. This means that an applicant for registration of a sign as a CTM cannot rely, to its advantage and in order to secure an identical decision, on a possibly unlawful act committed to the benefit of someone else. Moreover, the examination of any trademark application must be stringent and full, in order to prevent trademarks from being improperly registered. That examination must be undertaken in each individual case, based on the factual circumstances of that particular case (see Agencja Wydawnicza Technopol v OHIM).

As a result, the General Court held that, since the Board of Appeal was right to conclude that the word mark THE SPIRIT OF CUBA had been registered in breach of Article 7(1)(c) of the regulation, 1872 Holdings could not profitably rely on possibly incorrect previous decisions by OHIM.

The decision of the General Court underlines that every application for a CTM is examined on its own merits. The direct consequence of this rule is that earlier decisions by OHIM do not necessarily provide a precedent for future applications. Though understandable, the confirmation of the applicability of the adage “results obtained in the past do not provide any guarantees for the future” in Community trademark law does not contribute to legal certainty.

Sebastiaan Brommersma, Klos Morel Vos & Schaap, Amsterdam