Public will not establish link between SWATCH and SWATCHBALL

European Union

In Swatch AG v Office for Harmonisation in the Internal Market (OHIM) (Case T-71/14), the General Court has carried out a rather intriguing analysis of the potential link between the trademarks SWATCH and SWATCHBALL. The judgment followed an appeal by Swatch AG in opposition proceedings against the Community trademark SWATCHBALL.

The word mark SWATCHBALL was applied for by Panavision Europe Ltd. The applicant is a large company which operates in the field of film production services and studios. It applied for trademark protection for its sign in Classes 9, 35, 41 and 42 of the Nice Classification.

Watch giant Swatch filed a notice of opposition with OHIM arguing that the mark SWATCHBALL was liable to be confused and linked with its prior registered trademark SWATCH, which has a reputation in the Community. The grounds relied on in support of the opposition were those referred to in Article 8(1)(b) and Article 8(5) of the Community Trademark Regulation (40/94), now the Community Trademark Regulation (207/2009). Article 8(5) concerns the protection granted to trademarks with a reputation.

The Opposition Division and the Second Board of Appeal of OHIM both rejected the opposition. The Board of Appeal found that there was no likelihood of confusion, as the goods and services at issue were dissimilar. The reputation of the mark SWATCH was acknowledged by the board in the French, German and Spanish markets with respect to goods in Class 14, but the board found that there was no link between the marks.

Swatch filed an appeal to the General Court, raising a single plea in law alleging infringement of Article 8(5). However, the court dismissed the action.

In its judgment, the court first assessed the similarity between the two trademarks and concluded that they were similar to an average degree. The court also pointed out that the earlier mark had a particularly strong reputation, which neither of the parties denied. Therefore, the assessment focused on whether the reputation of the earlier mark would be adversely affected by a risk of one of the types of injury referred to in Article 8(5) as a result of the relevant public establishing a link between the marks at issue.

The General Court made the following key conclusions:

  • The signs were visually similar to an average degree and phonetically similar to a low or average degree, and were conceptually similar.

  • The goods and services covered by the marks were of a different nature, with different distribution channels, they were neither interchangeable nor in competition with each other, they served different purposes and did not belong to adjacent market segments, all of which resulted in a very limited degree of closeness between the goods and services in question.

  • The goods and services marketed by Panavision Europe targeted a specialist public, whereas the goods and services marketed by Swatch targeted the general public. Therefore, the relevant publics were not the same.

  • The factors weighing in favour of a finding that a link existed between the marks at issue were: (i) the similarity of the marks at issue, and (ii) the strength of the reputation of the earlier marks, which was regarded as high.

  • The following factors weighed against such a finding: (i) the differing nature of the goods and services covered by the marks at issue, given that they have different distribution channels, that they are neither interchangeable nor in competition with each other, that they serve very different purposes and do not belong to adjacent market segments, all of which resulted in a very limited degree of closeness between those goods and between those services; and (ii) the existence of two separate relevant publics.

  • The absence of similarity between the goods and services in question and the differences between their relevant publics were such that they excluded the existence of any link between the marks at issue.

  • The conclusion could not be called into question by the applicant’s argument that a link existed because software and other equipment used for film editing, included in the goods and services covered by the applied mark, may include a timekeeping mechanism which would link them to the earlier mark.

It remains to be seen whether Swatch will initiate a final round of appeal before the Court of Justice of the European Union.

Jukka Palm, Berggren Oy Ab, Helsinki, Finland

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