General Court considers explanatory notes of Nice Classification to determine similarity of goods

European Union

In The Sunrider Corporation v Office for Harmonisation in the Internal Market (OHIM) (Case T-221/12, January 23 2014), the General Court has upheld a decision of the Fourth Board of Appeal of OHIM finding that there was no likelihood of confusion between the mark SUN FRESH and earlier SUNNY FRESH marks.

These opposition proceedings involved the applicant for the registration of the mark SUN FRESH in Class 32 and the owner of earlier Community and national SUNNY FRESH marks registered in Classes 5, 29 and/or 32 of the Nice Classification. The opposed mark covered beer and other beverages in Class 32, while the opponent's trademarks covered “herbal nutritional supplements” in Class 5 and certain beverages in Class 32.

The applicant for SUN FRESH requested proof of use of the earlier marks. The proof of use produced by the opponent was accepted but, according to the Board of Appeal, it showed use only for a “dietary supplement based on a herbal concentrate", which fell within Class 5. As a consequence, the proof of use was valid only for the CTM and not for the other national marks on which the opposition was based. The Board of Appeal concluded that the products covered by the two marks were different and there was no likelihood of confusion. The opposition was thus rejected.

The opponent appealed, requesting that the General Court set aside the board's decision, except insofar as it concerned "beers", for which the mark could be registered. The opponent relied on three pleas, based on breach of:

  1. Article 42(2) and (3) of the Community Trademark Regulation (207/2009);
  2. the second sentence of Article 75 and the second part of Article 76(1) of the regulation; and
  3. Article 8(1)(b) of the regulation. 

The second and third pleas were examined together.

Concerning the first plea, the board had considered that the use of the mark in the previous five years had been proven for a "dietary supplement based on a herbal concentrate" falling within Class 5. The opponent claimed that it had proven genuine use in Class 32 in the United Kingdom for "herbal beverages; herbal teas; preparations and essences for making beverages; syrups for beverages”, in Ireland for “herbal beverages and preparations for making herbal beverage”, and in the Benelux for “herbal beverages and preparations for making herbal beverages, other than for medical use, all being part of the same class”.

The real issue, however, was not whether there had been genuine use, but how to construe and classify a product and how to qualify it.

The board had stated that liquid, the main purpose of which is not to quench thirst or to be used for normal human consumption, but which is used principally for medicinal use or to compensate nutritional deficiencies, is not a liquid and does not belong to Class 32, but to Class 5.

The General Court took into consideration not only the wording of Classes 5 and 32, but also the explanatory notes of the Nice Classification to decide that the relevant criterion was not the liquid or edible nature of the product, but its main purpose. On this basis, it recalled that the first sentence of the explanatory note for Class 5 states that "the latter includes mainly pharmaceuticals and other preparations for medical purposes”; this was replaced in the ninth edition of the Nice Classification by a reference to "preparations for medical or veterinary purposes”.

The court further noted that Class 32 is entitled "beers; mineral and aerated waters and other non-alcoholic drinks; fruit drinks and fruit juices; syrups and other preparations for making beverages”. The explanatory note for that class added that it includes “mainly non-alcoholic beverages, as well as beer” and expressly excludes "beverages for medical purposes" from its scope. Therefore, the criterion for distinguishing the goods in Class 5 from those in Class 32 was the use of the goods, namely their main purpose.

The second argument of the opponent was that only products having a medical function, property or main purpose could be included in Class 5.

The General Court stated that the board had not excluded that a beverage in Class 32 could also have a nutritional function. It also confirmed that liquids used to quench thirst fall within Class 32, while those used to correct nutritional deficiencies or for medical purposes fall within Class 5. This was confirmed by the tenth revision of the Nice Classification, which modified the title of Class 5 and added “dietary supplements for humans and animals”. The explanatory note for the same class was also modified by adding “dietary supplements, intended to supplement a normal diet or to have health benefits" and “meal replacements, dietetic food and beverages, adapted for medical or veterinary use"; however, it was also specified that the class did not include “meal replacements, dietetic food and beverages not for medical or veterinary purposes”.

As a consequence, the court stated that the board had not found that drinks in Class 32 could not have nutritional functions; it had only decided that liquids used to compensate nutritional deficiencies or which have some medical purposes were excluded from Class 32. The claim based on the wrong interpretation of the goods in Class 5 and 32 was thus rejected.

The second part of the first claim concerned the appreciation of the facts and their legal qualification. The opponent argued that the board should not have qualified the Sunny Fresh herbal concentrate only as a “herbal nutritional supplement” in Class 5, but also as a beverage in Class 32.

The court recalled that the classification of a liquid as a ‘beverage’ in Class 32 depends on its main purpose. In this case, the herbal concentrate was sold in batches of 10 bottles of 15ml each; it was mentioned on the product that it was recommended to drink a bottle of 15ml at each meal, but that one should not drink more than the recommended daily allowance, and that consumption by young children could be hazardous.

The court also considered the fact that the price list of the opponent presented the product as a herbal concentrate, and not as a beverage. The court took into consideration all those elements, which were external to the wording used in the registration, in order to classify the products, and confirmed the finding that the main purpose of the goods was not to quench thirst, but to address certain medical problems. 

The court added that OHIM had correctly taken into consideration the fact that it was not mentioned, either on the Sunny Fresh product or on the packaging, that the product could be mixed with water and consumed as a beverage. Even if this was a possibility, this did not alter the conclusion that the product was aimed at correcting certain medical deficiencies.

The court further held that the qualification as a “herbal nutritional supplement” did not imply that the product should be a medicinal product; it was sufficient that the product had a medicinal purpose in the broad sense of the term. This means that the qualifications under the Nice Classification are not automatically linked to other legal or regulatory texts which may govern the product, or the activities of the producer or of the owner of the mark. The court thus rejected the first claim, finding that the opponent's mark was registered only for product in Class 5, and that those products were neither identical nor similar to those covered by the opposed mark in Class 32.

The reasoning of the court was more traditional with regard to the second and third pleas. It noted that the likelihood of confusion must be examined with respect to the average consumer in all the EU member states. As far as the products in Class 32 were concerned, the average consumer was reasonably well informed, and reasonably observant and circumspect. For the Class 5 goods, the public had a relatively high level of attention, insofar as those goods affect their health.

The court further held that the main purpose of consuming "herbal nutritional supplements" in Class 5 was not to quench thirst or to form part of standard human nutrition, but rather to prevent or remedy medical problems in the broad sense of the term or to balance nutritional deficiencies. For this reason, those products in Class 5 were not similar to the beverages in Class 32, even if some of them are sold as liquid or may be mixed with water.

The opponent also criticised the fact that the board had found that the products at issue were not sold in the same points of sale. The court held that Article 76 of Regulation 207/2009 authorises OHIM to take into consideration facts which are well known (ie, which are likely to be known by anyone or which may be learnt from generally accessible sources). This was the case concerning the sale of “nutritional supplements" in drugstore or specialised shops. The opponent did not provide any evidence showing that its products were sold in the same distribution channel as the applicant's goods. The General Court did not take into consideration the fact that both types of products could be sold in supermarket, since they were sold in different aisles.

The opponent also criticised the board's finding that the end consumers of the goods were different. The court rejected this argument, holding that the board only wanted to express that, as the main purpose of the goods was different, the level of attention of consumers was higher with regard to goods in Class 5 than with regard to goods in Class 32. 

The opponent further argued that the products were in competition. This argument was rejected, as the court found that it relied on arguments that had already been considered and rejected.

In addition, the opponent argued that the products were complimentary. The court recalled that products are complementary if one is indispensable or important for the use of the other so that consumers may think that they have the same origin. However, such a relationship had not been proven in this case; on the contrary, “herbal nutritional supplements" in Class 5 were not indispensable or important for the use of beverages in Class 32.

Another argument raised by the opponent was that the General Court had already decided in several previous cases that “nutritional supplements” in Class 5 were similar to beverages in Class 32. The court, however, explained that the opponent had misread the only decision that it had quoted.

Finally, the opponent argued that the board had erred in finding that the manufacture of the products in Class 5 and 32 required different skills; certain manufacturers, including itself, produced goods in both classes. The court held that, even if this were true, this was not sufficient to overrule the part of the board's decision according to which the products were not similar. A likelihood of confusion can exist only if a major part of the producers are the same for the products at stake; the opponent had only mentioned that some producers manufactured both types of products, and a partial identity of the producers was not sufficient to create a likelihood of confusion.

The appeal was thus rejected.

The main interest of this case is that the comparison of the products was made on the basis not only of the Nice Classification, but also of its explanatory notes; moreover, even the information contained on the packaging of the opponent's goods was taken into consideration to decide whether the goods were similar.

Richard Milchior, Granrut Avocats, Paris

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