'Outward' use of mark not necessarily aimed at end consumers

In Recaro Holding GmbH v Office for Harmonisation in the Internal Market (OHIM) (Case T-524/12, November 21 2013), the General Court has confirmed that there is genuine use of a trademark where the mark is used in accordance with its essential function, which is to guarantee the identity of the origin of the goods or services for which it is registered, in order to create or preserve an outlet for those goods or services. The genuine use of a mark requires that it be used publicly and outwardly, but this does not necessarily mean that such use should be aimed at end consumers.

The decision further confirms that genuine use does not include token use for the sole purpose of preserving the rights conferred by the mark. Its existence must be proved through solid and objective evidence of effective and sufficient use of the trademark on the market. Moreover, the possibility that a previous trademark has already been put to genuine use should be assessed considering all the relevant factors. In particular, the interdependence between these factors must be taken into account (eg, the fact that the commercial volume achieved under the mark was not high may be offset by the fact that use of the mark was extensive or very regular, and conversely).

The dispute arose from the registration by Certino Mode SL on June 25 1999 of the word mark RECARO (No 73434) on the basis of the Community Trademark Regulation (40/94), now the Community Trademark Regulation (207/2009). The word mark was registered in Classes 10 (“orthopaedic footwear”) and 25 (“footwear (except orthopaedic)”) of the Nice Classification.

On September 16 2009 Recaro Beteiligungs-GmbH filed an application for revocation of the mark pursuant to Article 51(1)(a) of Regulation 207/2009, arguing that the word mark RECARO had not been put to genuine use.

By its decision of June 29 2011, the Cancellation Division of OHIM ruled that the mark had not been put to genuine use and revoked it in its entirety.

Certino appealed under Articles 58 to 64 of Regulation 207/2009, claiming that there had been genuine use of the trademark and providing additional evidence. 

The First Board of Appeal of OHIM observed that Certino, despite being an intermediary which was involved in the initial stage of production and distribution, was capable to demonstrate the genuine use of the word mark RECARO. Moreover, the board found that the orders received from two purchasers and the orders sent to a footwear manufacturer established use of the mark for footwear in significant quantities over the relevant period. Moreover, Certino’s participation in trade fairs and an article about its products established clear use of the mark for footwear. The board, by a decision of September 6 2012, thus found that the mark was valid for “footwear (except orthopaedic)” in Class 25; however, it dismissed the appeal with respect to “orthopaedic footwear” in Class 10.

Recaro appealed to the General Court, alleging:

1. infringement of Article 51(1)(a) of Regulation 207/2009, read in conjunction with Article 15 thereof (the board had erred in finding that there had been genuine use of the mark at issue for footwear);
2. infringement of Article 76(2) of Regulation 207/2009, read in conjunction with Rule 50(1) of the Community Trademark Implementation Regulation (2868/95) (the board should not have accepted the evidence adduced by Certino for the first time on appeal); and
3. infringement of Article 75(1) of Regulation 207/2009 (the board had failed to comply with its obligation to state reasons).

The court dismissed the first plea, finding that, based on the case law, there is genuine use of a trademark where it is used in accordance with its essential function. Recaro argued that there was no evidence that Certino sold to end consumers. The court first noted that the question of whether there is genuine use requires an overall assessment during which each piece of evidence must not be analysed separately, but rather together, in order to determine the most likely and coherent meaning. When assessing whether there is genuine use, regard must be had to all the facts and circumstances which are relevant in deciding whether commercial exploitation of the mark actually occurred. Recaro was right to observe that genuine use of a mark is found when it is used publicly and outwardly, but was wrong to affirm that trademarks used only in inter-corporate relations cannot enjoy the protection of Regulation 207/2009. The fact that Certino was present at trade fairs aimed at industry professionals, and not end consumers, was not relevant, as Certino’s commercial transactions with companies were sufficient to establish public and outward use of the mark.

With regard to the second and third pleas, the court noted that, under Article 76 of Regulation 207/2009, the Board of Appeal has a certain margin of discretion to allow or disallow facts and evidence produced late, with the only condition that it gives reasons for its decision on that point. This rule is applied in all types of proceedings, and does not differentiate between opposition proceedings and revocation or invalidity proceedings, as alleged by Recaro. The court found that the board’s reasoning had enabled Recaro to understand the board’s decision and to bring an action contesting the basis of that decision, including the evidence adduced in the proceedings before the Board of Appeal. The action was thus dismissed in its entirety.

Margherita Barié and Pietro Pouché, Carnelutti Studio Legale Associato, Milan