SAT.2 not descriptive under Article 7(1)(b), ECJ rules

The European Court of Justice (ECJ) has reversed the Court of First Instance's (CFI) decision to refuse registration of SAT.2 as a Community trademark. The CFI had held that the mark lacked distinctive character pursuant to Article 7(1)(b) of the Community Trademark Regulation. The ECJ ruled, among other things, that even though (i) the elements making up the SAT.2 mark are descriptive and commonly used, and (ii) their combination does not reflect a high degree of inventiveness, this does not mean that the mark as a whole lacks distinctiveness.

German television broadcaster SAT.1 SatellitenFernsehen GmbH applied to register SAT.2 as a Community trademark in Classes 35, 38, 41 and 42 of the Nice Classification. Both the Office for Harmonization in the Internal Market examiner and the Board of Appeal rejected the application pursuant to Article 7(1)(b) and (c) of the Community Trademark Regulation.

On further appeal, the CFI held that the mark was not descriptive of the services for which registration was sought and, thus, could not be rejected pursuant to Article 7(1)(c). However, it found that the mark consisted of a combination of elements that were capable of being commonly used in trade for the services covered by the registration. The CFI held that this made the mark as a whole devoid of any distinctive character and, accordingly, it could not be registered pursuant to Article 7(1)(b).

SAT.1 appealed again, claiming that the CFI's interpretation of Article 7(1)(b) was vitiated by two errors of law: firstly, Article 7(1)(b) does not aim to keep some terms free in the public's interest. Rather, it requires that the sign enable consumers to distinguish goods or services without any possible confusion about their origin. Secondly, the CFI had failed to examine the overall impression of the sign. Instead, it examined its elements separately, thereby applying a test only applicable under Article 7(1)(c).

Advocate General Jacobs pointed out in his opinion that the descriptive character of the element 'sat', which the lower instances had firmly established, could not be questioned. However, he opined that the addition of the figure '2' would suffice to make the mark distinctive, as a name followed by a figure is a common way to designate television channels (see Opinion may clarify principles behind lack of distinctiveness).

The ECJ came to the same conclusion, even though on a different basis. It ruled as follows:

• If the lower instances find a term descriptive, as was the case here with 'sat', such a finding cannot be questioned unless "the clear sense of the evidence is distorted".
  
  
• Contrary to the CFI's ruling, there is no presumption that elements that are individually devoid of distinctive character cannot, on being combined, be perceived by the relevant consumers as distinctive.
  
  
• The fact that a sign subject to an application for registration is commonly used for the relevant goods or services only constitutes a criterion for refusal under Article 7(1)(c) and is not to be considered under Article 7(1)(b), particularly where this rule would be applied to elements examined separately. The general interest underlying these two absolute grounds of refusal is different.
  
  
• Even though (i) the elements of the SAT.2 mark are commonly used if considered individually, and (ii) their combination does not reflect a particularly high degree of inventiveness, such considerations do not suffice to establish that the sign in its entirety is devoid of any distinctive character. Consequently, the absolute ground of refusal set out in Article 7(1)(b) did not apply to that particular mark.

Accordingly, the ECJ reversed the CFI decision and allowed the registration of SAT.2.

Hans Georg Zeiner, Zeiner & Zeiner, Vienna