Federal Supreme Court: famous marks always benefit from enhanced protection

Switzerland

The Swiss Federal Supreme Court has held that VOGUE was a famous trademark and, in doing so, has confirmed its established case law that protection of a famous trademark reaches so far as to prohibit others from using the mark for any type of goods or services (Decision 4A_128/2012, August 7 2012). The otherwise applicable principle of speciality (ie, trademark protection reaches only so far as the claimed goods and services) does not apply to famous trademarks.

A company based in Le Locle, Switzerland, manufactured and sold watches bearing the mark VOGUE MY STYLE, with the words 'my style' printed in very small letters. The owners of the trademark VOGUE and publishers of the fashion magazine Vogue filed a trademark infringement action against the Swiss watchmaker before the High Court of the Canton of Neuchâtel.

On January 31 2012 the court ordered the watchmaker to stop using the designations 'Vogue' or 'Vogue my style' on the grounds of unfair competition. However, although the court considered VOGUE to be a famous trademark, it rejected the claims based on trademark law on the grounds that the products (ie, a magazine on the one hand, and watches on the other) were dissimilar.

Upon appeal by the watchmaker, the Federal Supreme Court first considered whether VOGUE is a famous trademark eligible for the special protection set out in Article 15 of the Swiss Trademark Act. As the term 'famous trademark' is not defined in the act, the court reiterated the established requirement that, in order to be considered famous, a mark must have a high recognition/standing among the public at large. To meet this requirement, it is not sufficient that a high percentage of the public at large recognises the mark, as this quantitative requirement would not allow to distinguish between a famous mark and a well-known mark. There is also the qualitative requirement that the mark must have a positive image among the public. However, it is not necessary that there be an unanimous view among the public at large that the mark conveys a positive image; for example, cigarette brands can be famous, despite the public controversy about smoking.

The notion of 'famous trademark' under Article 15 of the act is a matter of law. However, the issues of whether a trademark is known by the public at large and enjoys a positive image are matters of fact which must be demonstrated by the trademark owner through adequate means (eg, a demoscopic survey) - or, at least, these facts must be commonly known ('notorious').

In order to convince the court that VOGUE is a famous trademark, a survey of 1,100 randomly selected persons aged 15 to 74 had been conducted across the three language regions in Switzerland, taking both the quantitative and qualitative requirements into account. According to this survey, approximately 25% of respondents recognised the brand name Vogue and associated it with a high-quality magazine. As it was established that the trademark VOGUE was known by a high percentage of the public at large in all of Switzerland and that it enjoyed an overall positive image, the court agreed with the lower court's conclusion that VOGUE is a famous trademark.

However, the Federal Supreme Court disagreed with the lower court's finding regarding the scope of protection of famous trademarks. The cantonal court had (erroneously) found that, for descriptive marks­­ such as VOGUE ('en vogue' meaning 'fashionable'), the principle of specialty applies even if they are considered to be famous. Accordingly, they can be protected only in relation to goods or services that are identical or similar to those covered by their registration or use. The Federal Supreme Court held that famous trademarks always benefit from a wider scope of protection, which is not restricted to similar goods and services. The principle of speciality does not apply to famous trademarks and such marks may provide a cause of action against dissimilar goods and services - that is, any type of products or services, including non-competing goods/services. According to the court, this “blocking effect” is not restricted to inherently distinctive trademarks, but also includes descriptive marks.

Therefore, the court concluded that the prohibition against the sale of VOGUE MY STYLE-branded watches was  justified not only on the basis of the Unfair Competition Act (which was no longer contested before the Federal Supreme Court), but also on the basis of trademark law.

The court also dismissed the lower court's erroneous view that the origin of the distinctive character of a trademark (ie, whether it is inherently distinctive or whether it has acquired distinctiveness through use) could have an impact on the scope of protection of the mark once it has obtained the status of a famous trademark.

Another interesting aspect of the decision is the court's view that, in order to be recognised as famous, the quantitative requirement (ie, the mark is known by a high percentage of the public at large) must be combined with the qualitative requirement (ie, the mark enjoys a positive image). The court did not elaborate on which percentage is required to meet the quantitative element; rather, it simply held that the fact that approximately 25% of the public recognised the mark VOGUE and associated it with a high-quality magazine was sufficient to consider VOGUE as a famous trademark. This remark may lead to the conclusion that, from now on, relatively low percentages of recognition would be sufficient to recognise high-end brands as famous trademarks, as long as these 25% associate the brand with a positive image. However, although this argument may be used in future litigation, it should be noted that the survey used in the lower court's proceedings had found that 70% of respondents recognised the mark VOGUE. In any event, this decision can serve as a basis for the argument that a low recognition rate among the public at large can be outweighed by the fact that the brand at issue is associated with an image of high quality.

Markus Frick, Manuel Bigler and Nico Bernhard, Walder Wyss Ltd, Zurich    

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