IP High Court rules that 'Mount Asama' cannot be registered for beer

The IP High Court has upheld the Japan Patent Office's (JPO) decision to reject the application for the registration of the trademark ASAMAYAMA ('Mount Asama' in Japanese) for the designated goods "beer, carbonated drinks, fruit juices, vegetable juices, extracts of hops for making beer and whey beverages" in Class 32 of the Nice Classification.

The court ruled that ASAMAYAMA was not a distinguishable trademark, even though a previous registration existed for the mark ASAMAYAMA for similar designated goods – in particular, "Japanese liquors, Western liquors, alcoholic fruit beverages and Chinese liquors" in Class 33. The court upheld the JPO trial decision which had confirmed the original JPO rejection of the application on the grounds that it fell within the scope of Article 3(1)(3) of the Trademark Law (127/1959, as amended).

Article 3(1)(3) of the Trademark Law provides that registration cannot be granted:

"in the case of a trademark that consists solely of a mark indicating in a common way the place of origin or sale, quality, raw material, efficacy, use, quantity, shape (including packaging) or price of the goods, or the method, time of manufacture or use, or the location of the provision of services, or the quality, articles used, efficacy, use, quantity, modes or price, or the method or time of provision of services."

Article 3(2) of the law provides that:

"in the case of a trademark falling under Items 3 to 5 of the preceding paragraph, where, as a result of the use of a trademark, consumers can recognise goods or services as being connected to a certain person's business, trademark registration may be obtained notwithstanding the provisions of the preceding paragraph."

On April 24 2012 plaintiff Asama Sake Brewing Kabushiki Kaisha filed an application for registration of the mark ASAMAYAMA in standard characters for the designated goods in Class 32.

The JPO rejected the application on February 5 2013 on the grounds of Article 3(1)(3) of the Trademark Law. The plaintiff subsequently filed a complaint and application for trial with the JPO on May 8 2013.

On October 23 2013 the JPO issued a trial decision upholding the original JPO decision. The JPO held that the trademark in question, when used for the designated goods, should be recognised as referring to goods produced or sold in the "areas of Mount Asama, which is the active volcano stretching across Nagano and Gunma Prefectures". This suggested that the marks indicated the place of production or sale in an ordinary way pursuant to Article 3(1)(3). The JPO's original rejection of the application based on Article 3(1)(3) was therefore correct.

The plaintiff appealed to the IP High Court on December 11 2013. The plaintiff based its counter-argument on the following grounds:

• Since many mountains across Japan are named 'Asamayama', the exact place of production and sale could not be identified from the mark.
• There was nothing to suggest that local beer or mineral water was produced or sold in the area surrounding Mount Asama.
• The trial decision had ignored the fact that many mountain names have successfully been trademarked.
• The trial decision had ignored various circumstances of the plaintiff's prior dealings.

The court upheld the JPO trial decision on June 30 2014. It laid out its reasoning as follows.

The court first held that, in determining whether an application "consists solely of a mark indicating in a common way the place of origin or sale" under Article 3(1)(3), the designated goods in question need not actually be produced or sold in the area indicated by the mark; rather, it is sufficient if general consumers and dealers recognise the designated goods as being produced or sold in the indicated area (Supreme Court judgment, First Division, Saibanshuu Minshuu 147-7, January 23 1986).

A trademark will be construed to fall within the scope of Article 3(1)(3) not only where consumers and dealers generally recognise the trademark as referring to the place of production or sale of the designated goods at the time of the trial decision, but also where the trademark can in theory be perceived as indicating the place of production or sale (ie, even if consumers or dealers do not actually recognise the mark as an indication of the place of production or sale).

Due to the nature and character of the designated goods in this case, the court held that consumers and dealers constituted 'general consumers' under the law and – when encountering the goods attached to the trademark in question – would recognise them as having been produced in the area surrounding the Mount Asama located in the border area of Nagano and Gunma Prefectures. Moreover, the trademark portrayed the word 'Asamayama' in standard characters; therefore, it was shown "in a common way". The trademark thus simply indicated the place of origin or sale of the goods and fell within the scope of Article 3(1)(3). Consequently, the court ruled that the JPO had not erred in its trial decision.

The plaintiff asserted that since many mountains in Japan are named 'Asamayama', the place of production and sale could not be identified from the mark. However, the court held that 'general consumers' – the traders and consumers of the designated goods – think only of the 'Asamayama' located at the border of Nagano and Gunma Prefectures based on the trademark's Chinese characters. Thus, the plaintiff had no solid grounds for its assertion.

The plaintiff further alleged that 'Asamayama' was simply the name of a mountain, not the place of production or sale. However, the trademark's Chinese characters evoked a specific area at the foot of the mountain in the minds of consumers; the mark thus designated this specific area. Therefore, it was easy for consumers to interpret this designated area as the place of production or sale.

The plaintiff argued that the trial decision's findings regarding the production and sale of local beer and mineral water in the area surrounding Mount Asama were erroneous. However, a local beer had once been produced and sold under the name 'Asamayama Roman' and the trademark for this name had been registered on January 24 2003, but was cancelled on January 24 2013. The court held that general consumers would recall that beer sold under the name 'Asamayama' was once produced in the area surrounding Mount Asama. Further, water had previously been produced and sold under the name 'Asamayama Iron-containing Mineral Water', but was subsequently discontinued. Therefore, the court also held that general consumers would likewise recognise water named 'Asamayama' as having once been produced in the area surrounding Mount Asama.

The plaintiff alleged that the trial decision had ignored the fact that many mountain names have been registered as trademarks. However, it was unclear from the plaintiff's argument in this regard whether it sought protection under Article 3(2) of the Trademark Law. The court thus could not accept this argument.

Lastly, the plaintiff held that the trial decision had ignored the circumstances of the plaintiff's previous dealings – in particular, the fact that the plaintiff had been using a registered trademark (No 2462191 in Class 33) for a long time. The court held that there was insufficient evidence that the plaintiff's registered trademark was well known. Further, there was no discernible evidence that the trademark that was the subject of the application at hand had obtained similar familiarity. Therefore, the court rejected all of the plaintiff's arguments and dismissed its claims.

Many applications are made for marks incorporating names containing the Japanese word for 'mountain' or 'mount', especially in classes covering Japanese liquors and various beverages. Consumers of Japanese liquors tend to prefer famous brands containing the word 'mount' or 'mountain'. Nonetheless, such applications are frequently rejected on the grounds of Article 3(1)(3) of the Trademark Law.

A general review of applications for names containing the word 'mount' or 'mountain' for goods in Class 33 (Japanese liquors, Western liquors, alcoholic fruit beverages and Chinese liquors) and Class 32 (beer, carbonated drinks, fruit juices, vegetable juices, extracts of hops for beer and whey beverages) reveals that aside from the ASAMAYAMA mark in question, the JPO has rejected several other marks on the grounds of Article 3(1)(3), including those for IIZUNA YAMA and ASO SAN (both in Class 33).

Notwithstanding this, many other similar applications have been accepted without citing Article 3(1)(3), including those for AKAGIYAMA (Class 33), TATEYAMA (Class 33), BANDAISAN (Classes 32 and 33), TAKAOSAN (Classes 32 and 33), CHOKAISAN (Classes 32 and 33), GASSAN (Class 33), HAKUSAN (Class 33), HAGUROSAN (Classes 32 and 33), FUJISAN (Classes 32 and 33) and HAKKAISAN (Class 33) – not to mention the previous ASAMAYAMA mark in Class 33.

Unfortunately, on the basis of this previous practice, it is difficult to derive any consistent rule followed by the JPO in determining whether to register names containing the word 'mount' or 'mountain'.

In the case at hand, it seems that the plaintiff did not vigorously seek protection under Article 3(2) of the Trademark Law. However, had the plaintiff provided sufficient evidence to substantiate the claim that its Asamayama beer was well known, it likely would have stood a better chance of success in applying Article 3(2) to register its mark.

Eiichi Fukushima, Nishimura & Asahi, Tokyo