General Court sheds light on requirements under Article 8(4)

In Out of the blue KG v Office for Harmonisation in the Internal Market (OHIM) (Case T-344/13, November 19 2014), the General Court has dismissed an action filed by Out of the blue KG against a decision of the Second Board of Appeal of OHIM. The decision sheds some light on the requirement of "use of more than mere local significance" under the rarely applied Article 8(4) of the Community Trademark Regulation (207/2009).

In September 2010 Frédéric Dubois and another applicant filed a Community trademark (CTM) application for the word mark FUNNY BANDS in Classes 14, 17 and 35 of the Nice Classification. Out of the blue opposed based on the German non-registered trade name Funny Bands and the domain name 'funny-bands.com', used for identical goods and services, under Article 8(4) of the regulation.

When OHIM requested evidence that the conditions set out in Article 8(4) were satisfied, the opponent submitted an extract from the database WHOIS, showing that it was the owner of the domain name 'funny-band.com', and six screenshots from that website. In a further brief, the opponent submitted additional screenshots obtained via the Wayback Machine showing older screenshots of the website. The Opposition Division of OHIM rejected the opposition, holding that the evidence submitted by Out of the blue was not sufficient to prove that the non-registered signs relied on benefited from the protection afforded by Article 8(4).

Out of the blue appealed. With its statements of grounds, it submitted copies of 11 invoices which dated from the relevant period. The Second Board of Appeal of OHIM dismissed the appeal, holding that the additional evidence was inadmissible, as it referred only to the product name Funny Bands, and not to the trade name or to the domain name. Therefore, the opponent had not sufficiently proven that the use of its signs was of more than mere local significance.

Out of the blue filed an action with the General Court, requesting that the decision of the Board of Appeal be annulled. It argued that:

• it had submitted all the relevant evidence, including invoices showing the kind of business activities it carried out under the trade name Funny Bands and the domain 'funny-bands.com';
• this evidence showed a real presence on the market; and
• under German Law, it is sufficient, in order to secure protection for a trade name, to show the commencement of a business activity, and it is not necessary to prove a specific degree of intensity of that business activity.

The General Court first noted the four cumulative conditions set forth in Article 8(4) of the regulation:

• the sign relied on must be used in the course of the trade;

• use of the sign must be of more than mere local significance;

• the right to that sign must have been acquired in accordance with the law of the member state in which the sign was used prior to the date of application for registration of the CTM; and

• the sign must confer on its proprietor the right to prohibit the use of the subsequent trademark under national law.

With respect to the requirement that the use must be of more than mere local significance, the General Court quoted a number of judgments of the General Court and the Court of Justice of the European Union (ECJ). The courts held in previous decisions that the rationale of Article 8(4) is to restrict the number of conflicts between signs by preventing actions based on earlier signs which are not sufficiently important or significant. In that respect, the ECJ held in Anheuser-Busch v Budejovicky Budvar (Case C-96/09 P) that the relevant criterion is not genuine use in the sense of Article 42(2) and (3) of the regulation - rather, the sign relied on must be used in a sufficiently significant manner in the course of trade, which is determined by the duration and intensity of the use and by the use made of the sign in advertising and commercial correspondence.

Further, the General Court held in other decisions that account must be taken not only of the geographical dimension, but also of the economic dimension of the sign's significance, which is assessed in light of the length of time and the degree to which it has been used, the group of addressees among which it is known as a distinctive element and the exposure given to the sign. The mere fact that a sign confers on its proprietor an exclusive right throughout the national territory under national law is in itself insufficient; the importance of the sign “must be demonstrated by solid and objective evidence of actual and sufficient use”.

Based on this case law, the General Court came to the conclusion that it is not sufficient for an opponent to submit evidence which shows only that the earlier rights exist in the member state at issue; it is necessary to prove the existence of actual and sufficient business activities to show that the use is of more than mere local significance. The mere presence of the website was therefore not sufficient under Article 8(4); it would be necessary to submit evidence of whether, and to what extent, the site had been visited by third parties. The German practice, which requires only to show a commencement of the business activities and not a specific degree of intensity, is not applicable under EU Law.

The General Court then turned to the various pieces of evidence and clearly indicated that the extract from the database WHOIS, as well as the screenshots from the website, including those obtained via the Wayback Machine, showed only that the domain name and the trade name existed, but did not allow to draw any conclusions as to the actual business activities carried on through this website. The court stated that screenshots do not establish the intensity of the alleged commercial use and that it would have been necessary to show, for example, a certain number of visits to the website, emails received via the website or the volume of business generated through the website.

The General Court then considered the 11 invoices, leaving open the issue of whether they had been submitted belatedly and should not have been taken into account. It referred to the fact that these invoices contained only references to the website 'ootb.de' and the email address '[email protected]', and that 'Funny Bands' was mentioned only in the description of the goods invoiced. The court agreed with the Board of Appeal that this reference to 'Funny Bands' on the invoices was a reference to the product name Funny Bands, which could prove only the use of a product name, and not of a trade name or domain name. The court referred to Paragraph 5(2) of the German Trademark Act, which provides protection to trade names and internet domains, but not to product names. As none of the 11 invoices contained a reference to the trade name Funny Bands or the domain 'funny-bands.com', they could not be taken into account.

Furthermore, the General Court disagreed with the opponent that the reference to the product name also showed use of the trade name and domain name. The court clearly stated that the invoices did not necessarily mean that the goods invoiced were purchased on that website, and that this conclusion was supported by the fact that the invoices mentioned only the website 'ootb.de'.

This decision shows how difficult it is to fulfil the requirements set forth in Article 8(4). It is always easier to rely on prior CTM registrations or applications or prior registered national marks. If opponents can rely only on unregistered signs whose use in the course of trade is of more than mere local significance, it is not sufficient to provide evidence that these signs exist: they must also show that the signs have been used commercially to a sufficient extent. The threshold to be able to rely on Article 8(4) seems to be relatively high, and the mere submission of documents, screenshots and invoices which do not refer to the trade name or domain name is, according to the General Court, not sufficient.

Carsten Albrecht, FPS Fritze Wicke Seelig, Hamburg