No likelihood of confusion between SPAGO and SPA, says CFI

European Union
In Spa Monopole, compagnie fermière de Spa SA/NV v Office for Harmonization in the Internal Market (OHIM) (Case T-438/07, November 12 2009), the Court of First Instance (CFI) has held that there was a low degree of similarity between the trademarks SPAGO and SPA.
 
De Francesco Import GmbH sought to register the word mark SPAGO as a Community trademark in respect of goods in Class 33 of the Nice Classification ("alcoholic beverages (except beers)"). Belgian company Spa Monopole, compagnie fermière de Spa SA/NV lodged an opposition based on its earlier Benelux registration for the word mark SPA covering “mineral and aerated waters and other non-alcoholic drinks; syrups and other preparations for making beverages” in Class 32.
 
The Opposition Division of OHIM upheld the opposition, finding that the marks were similar because they shared the word 'spa'. It also considered that use of the mark applied for could be detrimental to the repute of the earlier mark, as alcohol can have a harmful effect on health.
 
On appeal, the Second Board of Appeal of OHIM annulled the decision of the Opposition Division, finding that there was a low degree of similarity between the marks and the goods. In light of this, the board considered that use of the mark applied for would not be detrimental to the repute of the earlier mark. Spa Monopole appealed to the CFI.
 
The CFI first pointed out the differences in the nature of the goods:
  • Alcoholic and non-alcoholic beverages have different characteristics;
  • Alcoholic beverages are usually consumed on special and convivial occasions, while water and non-alcoholic drinks are consumed on a daily basis;  
  • Alcoholic and non-alcoholic beverages satisfy different needs;
  • The average consumer is aware of the distinction between alcoholic and non-alcoholic drinks; and
  • Alcoholic and non-alcoholic beverages have different price ranges.   
The CFI further held that the similarities between SPAGO and SPA were insufficient for the relevant consumers to establish a link between the marks. Given that both marks are short in length, the CFI considered that the relevant public would perceive the words 'spa' and 'spago' as a whole, and would not split the SPAGO mark into 'spa' and 'go'. The use of capital letters at the beginning and end of the mark applied for (SpagO) and the addition of the suffix 'go' enabled the relevant public to make a distinction between the marks. No conceptual comparison was carried out because SPAGO is deprived of meaning, while SPA refers to the town of Spa in Belgium. 
 
Finally, the CFI held that the reputation of the earlier mark did not alter in any way the finding that there was a low degree of visual and phonetic similarity between the marks. Therefore, Article 8(5) of the Community Trademark Regulation (40/94) could not apply as one of the three conditions for its application - the similarity of the marks - was not met.
 
The action was thus dismissed.
 
The decision is in line with established case law relating to the reputation of earlier marks: reputation will not automatically imply that consumers will make a link between the earlier mark and the mark applied for. The similarity of the marks is a prerequisite to finding that use of the later mark may harm the reputation of the earlier mark.
 
Franck Soutoul and Jean-Philippe Bresson, INLEX IP EXPERTISE, Paris

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