Requirements for proving use of earlier mark in opposition clarified

European Union
In Boston Scientific Limited v Office for Harmonization in the Internal Market (OHIM) (Case T-325/06, September 10 2008), the Court of First Instance (CFI) has set out the requirements for proving use of an earlier trademark cited in an opposition under Article 43(2) or (3) of the Community Trademark Regulation (40/94).
Boston Scientific Limited applied for the registration of the mark CAPIO as a Community trademark for "apparatus for placing a suture" in Class 10 of the Nice Classification. Terumo Kabushiki Kaisha opposed the application based on its trademark CAPIOX, which was registered in various European jurisdictions for goods in Class 10. However, evidence of use was submitted only in relation to the Finnish registration and in respect only of "hollow fibre oxygenators with detachable hard-shell reservoir". Accordingly, it was the Finnish market that was considered.
The Opposition Division rejected the opposition. The Second Board of Appeal annulled the decision. Boston Scientific appealed to the CFI on the grounds, among others, that the evidence of use submitted by Terumo was insufficient to substantiate genuine use under Article 43(2) or (3) of the regulation.
The CFI began by noting that the principle behind Articles 43(2) and (3), as stated in the recitals to the regulation, is that protection of an earlier mark is not justified except where it is actually used. The CFI explained that the exercise undertaken under Articles 43(2) and (3) is not to evaluate the commercial success of the trademark, but to determine whether the mark has been used genuinely (ie, publicly and externally) to guarantee the origin of goods or services. 
The CFI set out factors to be considered in deciding whether use claimed is genuine. According to the CFI, no single factor is determinative as the factors have a degree of interdependence and are subject to an overall assessment of the whole circumstances. The principal issue is whether the use can be viewed as warranted in the economic sector concerned in order to create or preserve market share for the goods or services protected by the mark. Therefore, the factors to be considered include:
  • the nature of the goods or services;
  • the characteristics of the marketplace;
  • the frequency of use of the mark;
  • the volume of use of the mark;
  • the length of time during which the mark has been used; and
  • the territorial scope of the use of the mark.
Each factor must be viewed in light of the others. For instance, the volume of use must be considered by reference to the nature of the market. The CFI held that no minimum quantity of use can be set as a threshold - that is, there is no de minimis rule preventing OHIM or the CFI from considering all the circumstances of claimed use. Even minimal use of a trademark may be genuine. 
In this case, the sale of a low quantity of goods under the CAPIOX mark was held to be genuine use given the specialized nature of the goods and the consequently narrow market. Although Terumo submitted no evidence of the market structure (a failure the CFI viewed as "regrettable"), the CFI assumed the existence of a narrow market given the goods' specialized nature. The low number of transactions under the trademark was thus seen as more than token and held to be genuine. The genuineness of the use was also supported by evidence of advertising under the mark.
It follows from the decision that a prudent opponent should submit evidence not only of the quantity, territorial scope and value of use of an earlier mark, but also of the nature of the goods and services, as well as the characteristics of the relevant market. Evidence of advertising may also assist in cases involving low sales. Conversely, where no such evidence is submitted by an opponent, an applicant may seek to discredit an opponent's evidence in the absence of the proper context in which it ought to be assessed.
Paul Johns, Ashurst LLP, London

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