General Court: use within UK alone sufficient to support CTM under ONEL

European Union

In TVR Automotive Ltd v Office for Harmonisation in the Internal Market (OHIM) (Case T-398/13), the General Court has confirmed that genuine use does not need to be continuous and can even include a period of insolvency. It has also confirmed that use within the United Kingdom alone was, in this case, sufficient to support a Community trademark (CTM).

In 2007 TVR Italia Srl filed an application for the figurative mark TVR ITALIA for goods including "automobiles" in Class 12 of the Nice Classification.

In 2008 the predecessor of TVR Automotive Limited filed an opposition against TVR Italia's application on the basis of rights which included an earlier CTM. The opposition was partially successful. However, the Second Board of Appeal of OHIM subsequently found that the opponent had not provided sufficient proof of genuine use and so rejected the opposition. TVR Automotive appealed the decision.

TVR Automotive alleged that the Board of Appeal had failed to take into account an earlier decision of the Cancellation Division which had upheld the use of the mark. The court noted that, while OHIM is not bound to follow a previous decision, such decisions are, however, factors which should be taken into consideration. OHIM should not ignore the findings made in a final cancellation decision where there are opposition proceedings between the same parties, relating to the same subject-matter and based on the same grounds and evidence. In the present case, the relevant periods for assessing genuine use were different but overlapped and, therefore, the subject-matter of the two proceedings was not entirely identical.  

With regard to genuine use, the court confirmed that a mark may be put to genuine use for only part of the five-year period. Otherwise, any disruption which prevents use of the earlier trademark for a time might be sufficient to undermine the proprietor's rights.

In this case, the marks were used for a substantial part of the five-year period. As the use was in relation to high-end sports cars, a market with low demand and production to order, there was no need to furnish accounting documents setting out sales figures. Internet articles proved that the cars had been marketed in the United Kingdom, which would be sufficient from a territorial point of view, and demonstrated a certain scale of use during the relevant five-year period. Even though there was a dip in production due to insolvency, there was genuine use for the greater part of the five-year period which was sufficient to enforce the rights.

It is reassuring that the court has taken a realistic approach to genuine use. Forcing an owner to show continuous use during the whole five-year period would not reflect the reality that many genuine businesses face challenges and interruptions to their trade. In difficult times of this sort, it is often the reputation of the brand that can bring a business out of the other side of the crisis. It would be a cruel twist of the law if such a disruption could also strip a business of its trademark rights.

It is also good news that the General Court's interpretation of Leno Merken (ONEL) found that genuine use within the United Kingdom would be sufficient to preserve a CTM. This finding is in direct opposition to Hacon J's controversial interpretation of ONEL in the recent SOFA WORKSHOP case. Practitioners will be watching with interest to see how the law around territorial use of CTMs develops.

Hastings Guise, Fieldfisher, London

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