OHIM Board of Appeal may examine genuine use on its own motion

European Union
In Alder Capital Ltd v Office for Harmonisation in the Internal Market (OHIM) (Case T-209/09, April 13 2011), the General Court has considered a number of key issues regarding procedure, genuine use and unregistered trademark rights.

In 2001 Alder Capital Ltd filed an application for the registration of the word mark ALDER CAPITAL as a Community trademark (CTM) for financial services. The mark was registered in 2003. In 2005 Halder Holdings BV (now Gimv Nederland BV, the intervener in the present case) filed an application for a declaration of invalidity of the mark. The action was based on, among other things:
  • registrations for the word mark HALDER; and
  • unregistered rights in the trade names Halder and Halder Investments.
The action for invalidity was upheld by the Cancellation Division of OHIM and, subsequently, by the Second Board of Appeal. In particular, the Cancellation Division held that the CTM was invalid on the grounds that it was confusingly similar with the earlier unregistered rights in the trade names Halder and Halder Investments, which were found to be in use in the Netherlands. The registered trademarks on which the cancellation action was also based were found to be irrelevant due to lack of genuine use. In contrast, the Board of Appeal found that the CTM was invalid because there was a likelihood of confusion with the earlier mark HALDER INVESTMENTS, the genuine use of which had been proven with regard to the Benelux, Germany and Italy.
Alder Capital appealed to the General Court. At the hearing, Alder Capital brought three pleas in law in support of its action.
The first plea concerned procedural issues regarding the scope of the examination to be carried out by the Board of Appeal. The General Court found that the board must carry out a full examination of the application for invalidity, in terms of both law and fact. The board was able to rule not only on the same issues as the Cancellation Division, but also on the earlier marks and the potential likelihood of confusion between the CTM and the earlier marks. Therefore, the invalidity grounds in the Cancellation Division's decision were not binding on the board, and the court dismissed the first plea in law.
Second, Alder Capital argued that genuine use of the HALDER marks had not been proven. The court ruled that there is genuine use where a mark is used in accordance with its essential function, which is to guarantee the identity of the origin of the goods or services. As use of the marks in the present case was considered to be use as a trademark, and not use as a company name, trade name or shop sign, the court found that genuine use had been proven.
Finally, Alder Capital argued that there was no likelihood of confusion between ALDER CAPITAL and the earlier marks. The court, however, found that the marks were highly similar, as the element 'capital' would be perceived as ancillary. Accordingly, all the pleas were rejected by the court, and Alder Capital was ordered to pay the costs.
The decision is important in that it considers some essential issues, including:

  • what can be the basis of a Board of Appeal decision; and
  • how the requirements of genuine use for unregistered trademarks and trade names should be interpreted.
Lisbet Andersen, Bech-Bruun, Copenhagen   

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