Rosetta Stone's use of colour yellow held to infringe Langenscheidt's colour mark

Germany

The German Federal Supreme Court has held that use of the colour yellow by Rosetta Stone for language-learning software infringed the yellow colour mark of Langenscheidt for language dictionaries (Case I ZR 228/12).

German publisher Langenscheidt has distributed its printed dictionaries in a specific yellow colour since 1956; since the 1980s it has also marketed other products in this colour. After having proven in application proceedings that its mark had acquired distinctiveness through use, Langenscheidt’s obtained a German colour mark registration for “printed bilingual dictionaries” in January 2010 (claiming a priority date of March 7 1996). In 2010 US company Rosetta Stone started distributing its language-learning software in a yellow packaging in Germany, also using the colour yellow for promotion and marketing (eg, on its website).

Langenscheidt sued Rosetta Stone, arguing that use of the colour yellow infringed its trademark rights. The Cologne District Court and the Cologne Appeal Court found that Rosetta Stone’s products infringed Langenscheidt’s trademark rights. A further appeal by Rosetta Stone to the Federal Supreme Court was unsuccessful.

The Cologne District Court and the Cologne Appeal Court had both ordered Rosetta Stone to, among other things, refrain from using the colour yellow for its language-learning software because it infringed Langenscheidt’s registered colour mark. Rosetta Stone filed a request for cancellation of Langenscheidt’s mark before the German Patent and Trademark Office, arguing that the mark was devoid of inherent distinctive character and that it had not acquired distinctiveness through intensive use.  

The Patent and Trademark Office and the Federal Patent Court both rejected the request for cancellation. An appeal on points of law was pending before the Federal Supreme Court. Despite the pending cancellation proceedings, the Federal Supreme Court (as the Appeal Court had done before) rejected the defendant’s request to stay the infringement proceedings until a final decision was issued in the cancellation proceedings. The Federal Supreme Court’s standard for staying an infringement action while a cancellation action is pending requires “a certain degree of probability for the cancellation which justifies the delay resulting from a stay”.

Here, this requirement was not met. The court maintained this view while taking into account the finding of the Court of Justice of the European Union (ECJ) in Oberbank AG v Deutscher Sparkassen- und Giroverband eV (Sparkassen-Rot) (Joined Cases C-217/13 and C-218/13)  that, in cancellation proceedings, the burden of proving that a trademark has acquired distinctive character through use lies with the trademark holder, and the appellant’s argument that the chances of success in the cancellation action were thus higher.

The Federal Supreme Court had previously held that the burden of proof lies with the party challenging the validity of the mark. The court found that the ECJ’s decision in Sparkassen-Rot did not affect its evaluation of the defendant’s chances of success in the cancellation proceedings. According to the Federal Supreme Court, the impact of this ECJ decision on German practice remains “open”, because the ECJ based its decision on the incorrect assumption that Germany had not exercised its right to make use of the option in Article 3(3) of the Trademarks Directive (2008/95/EC) to provide that a trademark shall not be declared invalid on the grounds of descriptiveness or lack of distinctiveness if it has acquired distinctive character after the date of application for registration or after the date of registration (see Section 37(2) of the German Trademark Act).

As regards the requirement that the infringing sign must be used “as a trademark”, courts generally argue that consumers perceive the colouring of a product as a decorative element, rather than as a trademark. Consumers may perceive a colour as demonstrating the origin of the products only under specific conditions. In the present case, the Federal Supreme Court agreed with the lower court that, taking into account the perspective of the average users of the relevant products, the requirement of use “as a trademark” was met. The claimant had made extensive use of the yellow colour since 1956, and held a significant market share in the field of bilingual dictionaries. Its main competitor extensively used a specific green colour for its products. Use “as a trademark” applied not only to the claimant’s products, but also to defendant’s yellow-coloured products. Finally, the fact that the claimant and the defendant also used other marks on their products in addition to the colour yellow did not change the con­sumer’s perception that the colour yellow was used “as a trademark”.  

The Federal Supreme Court thus confirmed the Appeal Court’s assessment that dictionaries and language-learning software were complementary goods and that, therefore, the conflicting goods were highly similar. In view of the longstanding intensive use of the colour yellow by the claimant, including for dictionaries in 33 languages, the Federal Supreme Court found that the Appeal Court had correctly concluded that the mark at issue enjoyed an average scope of protection. As regard the conflicting yellow colours, the Federal Supreme Court also agreed with the Appeal Court’s finding that they were highly similar. Consequently, there was a likelihood of confusion.

The decision follows established principles in cases involving the infringement of so-called “abstract” colour marks (ie, marks consisting of a single colour without any figurative elements, as was the case here).

It is interesting to note the simultaneous pendency of infringement and cancellation proceedings involving the same mark and the almost simultaneous decisions in both cases. In the pending cancellation action, the Federal Supreme Court dismissed the appeal on October 23 2014 (Case I ZB 61/13) - that is, only one month after the decision in the infringement action was issued. The reasons for the dismissal of the cancellation claims were not available at time of writing. It will be interesting to see whether the Supreme Court takes into account the recent Sparkassen-Rot decision, which is - at least as regards the predetermined percentages for a finding of acquired distinctiveness - in obvious contradiction with the German courts’ requirement that the mark be recognised by at least 50% of the relevant public.

Philipe Kutschke, BARDEHLE PAGENBERG, Munich

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