General Court: OHIM made manifest error of assessment in refusing Nestlé's request to suspend opposition proceedings

In Société des produits Nestlé SA v Office for Harmonisation in the Internal Market (OHIM) (Case T-544/14, November 12 2015), the General Court has annulled a decision of the Fourth Board of Appeal of OHIM in opposition proceedings.

In 2011 Société des produits Nestlé SA filed an application for the Community word mark ALETE. The goods in respect of which registration was sought belonged to Classes 5, 29, 30 and 32 of the Nice Classification.

In 2012 Terapia SA brought opposition proceedings against the application for products in Class 5, based on its earlier Romanian word mark ALETA covering goods and services in Classes 5 and 35. The opposition was based on Article 8(1)(b) of the Community Trademark Regulation (207/2009) (likelihood of confusion with an earlier mark). On April 26 2013 the Opposition Division of OHIM allowed the opposition, judging that there was a likelihood of confusion. Nestlé appealed.

In parallel, as the grace period for use of the Romanian trademark ALETA had expired on November 30 2013, Nestlé asked a Romanian court to revoke Terapia's rights in this trademark for lack of genuine use in connection with all goods and services in respect of which it was registered, except for “ropinirole-based drug for the treatment of Parkinson’s disease”.

Nestlé then asked the Board of Appeal of OHIM to suspend the opposition proceedings until a final decision was issued by the Romanian court regarding the revocation of Terapia’s right in the ALETA mark. This request was based on Rule 20(7)(c) of the Implementation Regulation (2868/95).

On May 19 2014 the Fourth Board of Appeal of OHIM rejected Nestlé's suspension request on two grounds. First, the Board of Appeal noted that Nestlé had not contested in front of the Romanian court that the earlier trademark ALETA had been put to genuine use for a drug treating Parkinson’s disease. Second, the board pointed out that Terapia had not yet replied to Nestlé’s arguments in front of the Romanian court and that one could not know whether Terapia would furnish evidence of genuine use of the ALETA trademark. In this light, the board concluded that it was not more likely than not that Nestlé would succeed in the revocation proceedings. 

Ruling on the merits, the Board of Appeal confirmed the decision of the Opposition Division. Nestlé appealed to the General Court, which annulled the decision of the Board of Appeal due to a manifest error of assessment.

The General Court first noted that OHIM has broad discretion as regards whether the circumstances justify a suspension of the opposition proceedings. Therefore, the General Court could only verify the absence of a manifest error of assessment or of a misuse of power.

The fact that the validity of the earlier mark was being challenged in ongoing proceedings before a national court was insufficient in itself to find that the board had committed a manifest error of assessment in refusing to suspend the opposition proceedings. Indeed, OHIM must take into account not only the interests of the party whose mark is being contested, but also those of other parties.

Further, the fact that Nestlé did not challenge the use of the earlier trademark for one of the products for which it was registered did not justify the refusal to suspend the opposition proceedings. The Board of Appeal did not explain how the use of the ALETA mark for a drug treating Parkinson’s disease would demonstrate the genuine use of the trademark for all the goods covered by the trademark. Yet, when comparing the two trademarks, the Board of Appeal considered that the products at stake were identical by taking into account products other than the drug treating Parkinson’s disease - namely, products for which Nestlé asked the Romanian court to revoke Terapia’s rights in its trademark.

In addition, the Board of Appeal did not take into consideration several relevant elements of the case when ruling that it could not be known whether Terapia would furnish evidence of genuine use of the ALETA mark. In its request for suspension, Nestlé alleged that it had researched whether the ALETA trademark had been used and that the only use found concerned the drug treating Parkinson’s disease. Besides, in its observations in the opposition proceedings, Nestlé insisted on the fact that Terapia did not significantly use the ALETA trademark and that a search for the word 'aleta' on Terapia’s website did not produce any result. The General Court noted that this last argument had not been challenged by Terapia in the opposition proceedings.

Taking into account the fact that, in revocation proceedings, the burden of proof is on the owner of the trademark, the General Court concluded that the decision of the Board of Appeal to dismiss the suspension request was vitiated by a manifest error of assessment.

The General Court thus annulled the decision of the Board of Appeal but did not rule on the merits, since the state of the proceedings did not permit it to give a final judgment. The case will therefore be remitted to the Board of Appeal.

Richard Milchior and Virginie Fourgoux, Granrut Avocats, Paris