Importance of global appreciation highlighted

European Union

In Shaker di L Laudato & C Sas v Office for Harmonization in the Internal Market (OHIM) (Case T-7/04, November 12 2008), the Court of First Instance (CFI) has upheld a decision of the Board of Appeal of OHIM that it had originally annulled. In that decision, the board had allowed an opposition against the registration of a figurative mark featuring the word 'limoncello' based on an earlier Spanish registration for the mark LIMONCHELO. 

In October 1999 Shaker di L Laudato & C Sas, an Italian company, filed an application for the registration of the figurative mark LIMONCELLO DELLA COSTIERA AMALFITANA as a Community trademark for “jellies, jams and compotes” in Class 29 and “lemon liqueur from the Amalfi Coast” in Class 33 of the Nice Classification.

On June 1 2000 Limiñana y Botella SL opposed the application on the basis of its prior Spanish registration for the word mark LIMONCHELO for “wines, spirits and liqueurs” in Class 33. The Opposition Division of OHIM upheld the opposition on September 9 2002, finding that there was a likelihood of confusion under Article 8(1)(b) of the Community Trademark Regulation (40/94) on the grounds that:
  • there were visual and phonetic similarities between the two marks; and
  • the goods in question were identical. 
Shaker appealed. The Second Board of Appeal dismissed the appeal, holding that due to the similarity of the marks at issue and the congruence of the goods in question, there was a risk that Spanish consumers might confuse or associate their commercial origin.
Shaker appealed to the CFI. In its initial judgment, the CFI overturned the board’s decision, finding that there was no likelihood of confusion between the prior Spanish mark and the mark applied for, notwithstanding that the goods were identical. The CFI held that a complex trademark that is composed of several elements can be considered similar to another trademark only if the similar element constitutes the dominant element within the overall impression created by the complex mark. Analyzing the two marks, the CFI found that the dominant element of the mark applied for was the round dish decorated with lemons, which was distinctive due to its contrasting colours and large size, giving it a far more dominant visual impact than any other elements of the mark (including any of the words). Therefore, the CFI did not consider it necessary to assess the phonetic and conceptual features of the two marks, and found that there was not a sufficiently high degree of similarity between the marks for there to be a likelihood of confusion (for further details please see "Dominant figurative element squeezes out opposition").
OHIM challenged the judgment of the CFI. The main issue was how the likelihood of confusion between a word mark and a complex figurative mark should be assessed. In OHIM v Shaker (Case C-334/05 P), the European Court of Justice (ECJ) held that the likelihood of confusion had to be appreciated globally and assessed based on the overall impression created by the signs at issue. Accordingly, the CFI had made an error of law in holding that it was not necessary to analyze the phonetic and conceptual features of the other elements of the mark applied for. According to the ECJ, assessing the similarity of the two marks meant more than taking just one component of the composite trademark and comparing it with the other mark. The ECJ held as follows:
The comparison must be made by examining each of the marks in question as a whole, which does not mean that the overall impression conveyed to the relevant public by a composite trademark may not, in certain circumstances, be dominated by one or more of its components. […] It is only if all the other components of the mark are negligible that the assessment of the similarity can be carried out solely on the basis of the dominant element.”
The ECJ thus set aside the judgment and referred the matter back to the CFI (for further details please see "Complex mark confusion assessment clarified by ECJ"). 
Reinstating the board’s decision, the CFI acknowledged that the likelihood of confusion had to be assessed globally, taking into account all factors relevant to the circumstances of the case, in particular the interdependence of the similarity of the signs and the similarity of the goods and services covered. Consequently, the CFI stated that the figurative component of the mark applied for, consisting of a round dish decorated with lemons, occupied a place visually as important as the word 'limoncello' in the mark. However, the words 'della', 'costiera' and 'amalfitana' were written in a much smaller yellow font and were thus clearly secondary to the word 'limoncello'. The component 'shaker' was found to be negligible in the overall impression created by the trademark applied for, as it was only just visible in the mark as a whole, located at the bottom of the mark and written in small blue letters, with an image of a glass in the letter 'K' that went almost unnoticed. 
On an overall comparison of the marks, the CFI held that there was a certain similarity between them, as the words 'limoncello' and 'limonchelo' were visually and phonetically practically identical. Neither the words 'della costiera amalfitana' nor the word 'shaker' assisted in negating the similarity. The only conceptual difference with the Spanish trademark was the specification that the liqueur came from a particular coast. A likelihood of confusion could not be ruled out solely on the basis that the places of production were different. Consequently, there was also a conceptual similarity between the two marks. Accordingly, the Board of Appeal had correctly found that a likelihood of confusion existed.
Interestingly, Shaker also argued that given the manifest error of assessment vitiating the board’s decision, OHIM had misused its powers. Shaker argued that OHIM’s manifest error arose from its taking into account solely the word 'limoncello' for the trademark applied for when assessing the likelihood of confusion, which was not consistent with carrying out a global assessment of the various factors which might give rise to a likelihood of confusion. In addition, Shaker argued that there was a manifest error of assessment in the stance taken by OHIM throughout the application procedure. 
Pointing out that the concept of misuse of powers was narrow and referred only to cases where an administrative authority used its powers for a purpose other than that for which they were conferred, the CFI held that the alleged errors that the board had made in reaching its decision were insufficient to lead to the annulment of the contested decision. When OHIM requested that the application for registration be limited to the specific class of goods comprising lemon liqueurs coming from the Amalfi coast, OHIM sought to avoid the likelihood of confusion regarding the origin of the liqueur, but did not state that the geographic indication would exclude all likelihood of confusion. 
Consequently, the CFI dismissed the entire action and ordered Shaker to pay all the costs of the proceedings before the CFI and ECJ. The extensive litigation between the parties confirms the importance of the 'global appreciation' test expounded by the ECJ in Sabel v Puma (Case C-251/95): unless one element clearly dominates a trademark and all other components of the mark are negligible, the whole mark must be taken into account when assessing the likelihood of confusion.
Désirée Fields, McDermott Will & Emery UK LLP, London

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