The sky's the limit for extending trade mark rights past their use-by date

Briefing

Use it or lose it – this is a pillar of trade mark law recognised in jurisdictions the world over. In the UK and EU, you have five years to put your trade mark to genuine use or the exclusive monopoly you enjoy via your registration could be lost if a third party decides to attack it.

So why not simply re-file every four or so years, extending your monopoly indefinitely with a series of contemporaneous rights with the latest being, at less than five years old, un-revocable? Could you use the re-filed right to oppose other applications which are too similar to your mark without ever having to – and without being able to – prove use?

Background

This question was considered previously in Pathfinder. The Board of Appeal looked at the wording of Article 42(2) of the EUTMR (now 47(2)):

"If the applicant requests, the proprietor of an earlier EU TM who has given notice of opposition must furnish proof that the earlier EU TM has been put to genuine use provided that the EU TM has been registered for not less than five years. In the absence of proof of use, the opposition shall be rejected."

The Board interpreted the meaning of "earlier trade mark" to mean the same mark as the mark covered in the earliest registration owned by the opponent and not just the registration they rely on in the opposition. If the opponent had a registration over five years old, even if not relied upon, it would have to provide proof of use of any registrations for the same mark that are being relied upon, even though they are less than five years old.

In subsequent cases at the Board of Appeal (CURPOSAN, THONET and MONOPOLY), the Pathfinder reasoning was considered but, based on the facts, was not applied in those cases.

The SKYLITE decision

The General Court has now made it clear, in the recent SKYLITE decision (T736/15), that the Pathfinder decision is wrong. The only occasion a prior right owner can be put to proof of use is when the right being relied upon in the opposition has been registered for five years or more.

In this case, Aldi applied for a SKYLITE logo in classes 9 and 18 (for bags, travels bags etc). This was opposed by Sky Plc on the basis of its prior registrations for the mark SKY for the same goods. Aldi asked Sky to produce proof of use of its earlier marks relied upon despite the fact they were not yet five years old at the date of publication of Aldi's application. Aldi argued that the marks were clearly filed by Sky in bad faith, with no intention to use them on the goods or services in issue. Although Sky had only relied on its younger registrations, it did have older identical registrations which were more than five years old. The EUIPO Opposition Division and the Board of Appeal agreed that Aldi's request for proof of use was inadmissible.

The General Court affirmed that view, rejecting the reasoning in Pathfinder. That a registration was filed in bad faith, merely to artificially extend the five year grace period and with no intention to use it, could be an absolute ground for invalidity within the meaning of Article 52(1) of the EUTM Regulation. It is not a basis for defending an opposition. In opposition proceedings the EUIPO is required to consider that the earlier mark is valid, and that extends to situations even where it has doubts about the mark's distinctiveness and whether it should ever have been registered (Mizuno v OHIM). Article 42 does not provide a procedural mechanism that allows the validity of an earlier mark to be contested, regardless if the opponent has acted in bad faith.

For those looking to challenge the validity of a chain of re-filed registrations where the marks have not been used, you might not find a solution in a bad faith application. Decisions of the European Court of Justice (Lindt, C-529/07) and the General Court (Bigab, T-33/11 and Pelikan T136/11) indicate that although identical, repeat filings could be invalidated on grounds that they were filed in bad faith, where they are for different versions of the same mark, a claim of bad faith is likely to fail. It is common to 'modernise' and update brands as time passes, and such new filings do not mean a lack of intention to use.

This reasoning may fairly apply to brands that have been used over long periods of time but not necessarily where the scope of protection for each registration is extremely broad. It risks creating wide monopoly rights with effectively multiple defensive registrations. For now, it is clear that some trade mark owners are taking advantage of the system to re-file for stylised variants of their logos to thereby extend their monopoly over marks that might otherwise face revocation challenges. This is particularly so since it is recognised that the word element of the logo can, for some logos, still be relied upon almost as effectively against third parties as a word mark registration. Strategic re-filing could potentially continue indefinitely.

As with Pathfinder, the EUIPO has similarly struggled with the issue of earlier rights being relied upon which were valid at the time an opposition (or cancellation action) was launched but ceased to be by the time the case comes to be considered. In GOLD MONT, an earlier mark was successfully revoked for non-use during the opposition and cancellation appeal proceedings. It was held that, ''In order for the opposition to succeed, the earlier right must still be in force on the date of the decision''. This was decided on the basis that ''...a parallel revocation request is equivalent to a request for proof of use in the present proceedings pursuant to Art 42(2)''.

We question whether such reasoning will be affirmed at the General Court in the yet to be decided appeal. Article 42(2) is not the 'equivalent' of Art 42(2), because under Art 42(2) you can only put the opponent to proof of use "provided the earlier Community trade mark has at that date [the application or publication date of the later mark] been registered for not less than five years". In addition, the General Court in Group Lottuss Corp., SL v OHIM makes it clear that:

rights in a mark cease only from the effective date of revocation and no earlier, and
earlier marks should be considered valid for purposes of opposition or cancellation proceedings where the effective revocation date is later than the application/publication date of the challenged mark.

The ECJ in Cadila Healthcare Ltd v OHIM applied the same reasoning in the analogous scenario of the earlier mark having expired after the date of the first instance opposition decision. In contrast to the GOLD MONT reasoning, English law (see Riviera case O-214-03) has already been treating the date of publication of the opposed mark as the key date for considering the presumed validity of the earlier right. The fact that it subsequently be rendered invalid is immaterial.