CANCELLATION No C 15 185 (REVOCATION)

 

Zakrytoe Akcionernoe Obshhestvo "korporaciya "masternet", 7, ul. Magadanskaya, 129345 Moscow, Russian Federation (applicant), represented by Diehl & Partner Patent- Und Rechtsanwaltskanzlei Mbb, Erika-Mann-Strasse 9, 80636 Munich, Germany (professional representative)

 

a g a i n s t

 

Stayer Iberica, S.A., Calle Sierra de Cazorla, 7, Area Empresarial, Andalucia, Sector 1, 28320 Pinto (Madrid), Spain  (EUTM proprietor), represented by Bugnion S.P.A., Via di Corticella, 87, 40128 Bologna, Italy (professional representative).

On 26/03/2021, the Cancellation Division takes the following

 

 

DECISION

1.	The application for revocation is rejected in its entirety.

 

2.	The applicant bears the costs, fixed at EUR 450.

 

REASONS

 

On 05/07/2017, the applicant filed a request for revocation of European Union trade mark No 9 498 015 (figurative mark) (the EUTM). The request is directed against some of the goods, covered by the EUTM, namely abrading instruments (hand instruments) (discs and wheels) in Class 8.

The applicant invoked Article 58(1)(a) EUTMR.

SUMMARY OF THE PARTIES’ ARGUMENTS

 

The applicant filed a request for revocation of the EUTM on the ground that the EUTM had not been put to genuine use for a continuous period of 5 years. It did not submit any additional arguments.

The EUTM proprietor argued that the EUTM had been genuinely used in the relevant territory for abrading instruments (hand instruments) (discs and wheels) during the relevant period. It submitted evidence (distribution agreements, catalogues, leaflets and invoices) in support of its arguments (listed and assessed below). It added that the trade mark had also been used by Abrasivos Grinding SA, which was part of the EUTM proprietor’s group. With regard to the nature of use, it claimed that the different position of the figurative element at the beginning of the mark did not change the mark’s overall distinctiveness.

In reply, the applicant argued that in view of the brackets used in the specification, the goods for which the EUTM is registered should be interpreted as hand-operated abrasive discs and grinding wheels in Class 8, which are different from power tools in Class 7. Abrasive discs and grinding wheels may be classified in Class 7 or in Class 8, depending on whether they are accessories to power-operated tools or hand-operated tools. The EUTM proprietor decided to register the discs and wheels in Class 8 as accessories to hand-operated tools. Therefore, it had to prove use of abrasive discs and grinding wheels that are inserted into hand-operated abrasive instruments. However, the EUTM proprietor only provided documents pertaining to abrasive discs for power tools, and not hand-operated abrasive instruments. According to the applicant, there was no evidence that the EUTM proprietor’s abrasive discs or grinding wheels were intended for use with hand-operated tools. All the documents provided by the EUTM proprietor showed power tools and their accessories. Finally, the applicant considered that the invoices only showed intra-group sales. It submitted excerpts from Wikipedia to demonstrate the difference between hand tools and power tools.

In its rejoinder, the EUTM proprietor contested the applicant’s interpretation of the goods protected by the EUTM. It argued that there were many examples of goods included in Class 8 in spite of being powered by a battery or other source of electricity. The adjective ‘hand-operated’ does not exclude abrasive items inserted into hand tools that are controlled by a person. The EUTM proprietor also contested the applicant’s arguments regarding the alleged internal sales. It pointed out that the Court had held that outward use did not necessarily imply use targeting end consumers. Therefore, the fact that the EUTM proprietor targeted professionals in the relevant sector (namely distributors) by commercial means, could be regarded as use consistent with the essential function of the trade mark. This should be considered as use of the mark.

 

GROUNDS FOR THE DECISION

 

According to Article 58(1)(a) EUTMR, the rights of the proprietor of the European Union trade mark will be revoked on application to the Office, if, within a continuous period of five years, the trade mark has not been put to genuine use in the Union for the goods or services for which it is registered, and there are no proper reasons for non-use. 

Genuine use of a trade mark exists where the mark is used in accordance with its essential function, which is to guarantee the identity of the origin of the goods or services for which it is registered, in order to create or preserve an outlet for those goods or services. Genuine use requires actual use on the market of the registered goods and services and does not include token use for the sole purpose of preserving the rights conferred by the mark, nor use which is solely internal (11/03/2003, C‑40/01, Minimax, EU:C:2003:145, in particular § 35-37 and 43).

 

When assessing whether use of the trade mark is genuine, regard must be had to all the facts and circumstances relevant to establishing whether commercial exploitation of the mark is real, particularly whether such use is viewed as warranted in the economic sector concerned to maintain or create a market share for the goods or services protected by the mark (11/03/2003, C‑40/01, Minimax, EU:C:2003:145, § 38). However, the purpose of the provision requiring that the mark must have been genuinely used ‘is not to assess commercial success or to review the economic strategy of an undertaking, nor is it intended to restrict trade-mark protection to the case where large-scale commercial use has been made of the marks’ (08/07/2004, T‑203/02, Vitafruit, EU:T:2004:225, § 38). 

 

According to Article 19(1) EUTMDR in conjunction with Article 10(3) EUTMDR, the indications and evidence of use must establish the place, time, extent and nature of use of the contested trade mark for the goods and/or services for which it is registered. 

 

In revocation proceedings based on the grounds of non-use, the burden of proof lies with the EUTM proprietor as the applicant cannot be expected to prove a negative fact, namely that the mark has not been used during a continuous period of five years. Therefore, it is the EUTM proprietor who must prove genuine use within the European Union, or submit proper reasons for non-use.

 

In the present case, the EUTM was registered on 15/06/2012. The revocation request was filed on  05/07/2017. Therefore, the EUTM had been registered for more than five years at the date of the filing of the request. The  EUTM proprietor had to prove genuine use of the contested  EUTM during the five-year period preceding the date of the revocation request, that is, from  05/07/2012 until 04/07/2017 inclusive, for the contested goods listed in the section ‘Reasons’ above.

 

On 04/12/2017 the  EUTM proprietor submitted evidence as proof of use. 

 

As the EUTM proprietor requested to keep certain commercial data contained in the evidence confidential vis-à-vis third parties, namely exhibits 1 and 3, the Cancellation Division will describe the evidence only in the most general terms without divulging any such data.

 

The evidence to be taken into account is the following: 

 

 Exhibit 1: distribution agreements (in English).

o An ‘Exclusive Sales Agency Agreement’, dated 29/04/2013, between the EUTM proprietor and a UK company for the distribution of power tool products in the UK and Ireland. The products are defined as ‘Stayer Power Tools’, ‘Stayer Welding products’ and ‘Diamond and Abrasive Discs’ as shown in the catalogues.

o An ‘Exclusive Distributorship Agreement’, dated 13/12/2013, between the EUTM proprietor and a Polish company, for the distribution of power tool products in Poland, for a period of 3 years.

o An ‘Exclusive Distributorship Agreement’, dated 20/10/2016, between the EUTM proprietor and a Czech company, for the distribution of power tool products in the Czech Republic, for a period of 15 months. The contested EUTM is expressly mentioned in the section on intellectual property rights.

o An ‘Exclusive Distributorship Agreement’ dated 01/05/2017, between the EUTM proprietor and a Dutch company, for the distribution of power tool products in Netherlands, for a period of 9 months. The contested EUTM is expressly mentioned in the section on intellectual property rights.

 Exhibit 2: catalogues and brochures.

o A catalogue of the Polish company referred to in exhibit 1.b) (in Polish) marked ‘2013/2014’. The catalogue depicts the sign in connection with discs such as .

o A special STAYER catalogue, entitled ‘Promotion 2012’ (in Italian). The catalogue depicts the sign on the bottom right part of the pages. It shows discs and hand-held tools such as: and .

o An Italian ‘Stayer Magazine’ from June 2015 (in Italian) with references to on the cover page and the following sign on some of the products advertised (essentially discs): .

o An Italian ‘Stayer’ brochure from May 2013 (in Italian). This is similar to the abovementioned catalogue, but the advertising only refers to discs.

o Two examples of the ‘General Catalogue 2012/2013’ – one for English-speaking countries and the other for the Spanish market – presenting the STAYER GROUP company and its technology. The catalogue indicates that it features ‘a selected range of carefully designed diamond blades and abrasive discs, for any cutting or grinding of the materials commonly used in construction’. The following picture is shown: . The catalogues’ index shows a variety of products, including diamond discs, diamond core drills, and abrasive discs / flap discs. Regarding ‘grinding and flap discs’, the catalogue shows items defined, inter alia, as ‘cutting disc for super thin inox, cutting disc for stone and marble, metal cutting disc, metal grinding disc’ and depicted, for instance, as: .

o Four examples of the ‘General Catalogue 2014’ for, respectively, the Italian, Spanish, English-speaking and French markets, with references to disc products similar to those in the abovementioned 2012/2013 catalogues.

o A general 2015 catalogue for the Spanish market, with references to disc products similar to those in the abovementioned 2014 catalogue.

o Four general 2016 catalogues, respectively for the Italian, Spanish, English-speaking and French markets, with references to disc products similar to those in the abovementioned 2014 catalogue.

o A general 2017 catalogue for the Dutch market.

 Exhibit 3: invoices:

o 37 invoices issued to a Greek company (according to the EUTM proprietor, its exclusive distributor in Greece) between 30/10/2012 and 30/06/2017;

o not submitted;

o 15 invoices issued to a Polish company (according to the EUTM proprietor, its exclusive distributor in Poland) between 30/07/2012 and 30/06/2017;

o 14 invoices issued to a Romanian company (according to the EUTM proprietor, its exclusive distributor in Romania) between 10/09/2012 and 30/06/2017;

o 4 invoices issued to a Bulgarian company between 17/01/2017 and 31/05/2017;

o 6 invoices issued to a French company between 11/04/2017 and 30/06/2017;

o 81 invoices issued to a Portuguese company between 10/06/2016 and 29/06/2017;

o 7 invoices issued to various companies in Belgium, the Czech Republic and Finland between 30/06/2016 and 31/05/2017;

o 9 invoices issued to various companies in Belgium between 19/09/2016 and 14/06/2017;

o 9 invoices issued to an Estonian company between 07/09/2016 and 08/06/2017;

o 22 invoices issued to various companies in France between 09/06/2016 and 30/06/2017;

o 8 invoices issued to a German company between 28/07/2016 and 31/03/2017;

o 28 invoices issued to an Italian company between 30/06/2016 and 30/06/2017;

o 10 invoices issued to a Portuguese company between 09/06/2016 and 21/06/2017;

o 19 invoices issued to a Romanian company between 10/06/2016 and 30/06/2017;

o 28 invoices issued to various companies in Spain between 23/09/2016 and 29/06/2017;

o 7 invoices issued to various companies in Bulgaria, the Czech Republic, Greece, Latvia, Malta, the Netherlands and Austria between 14/09/2016 and 12/05/2017.

 Exhibit 4:

o a leaflet entitled ‘Poland 2017’, with references to disc products;

o a leaflet entitled ‘Romania 2017’, with references to disc products.

The invoices include product definitions (e.g. D.STAYER 115X1X22 INOX). They show substantial product sales. The EUTM proprietor has clearly connected those products with the STAYER products appearing in the catalogues and leaflets in exhibits 2 and 4. Moreover, frequent sales are shown throughout the relevant period.

Preliminary remark

The EUTM proprietor has submitted, inter alia, evidence relating to the United Kingdom (UK) with a view to demonstrating use of the contested mark. That evidence relates to a period prior to 01/01/2021.

On 01/02/2020, the UK withdrew from the EU subject to a transition period until 31/12/2020. During this transition period EU law remained applicable in the UK. Therefore, use in the UK prior to the end of the transition period constituted use ‘in the EU’. Consequently, the evidence relating to the UK and to a period prior to 01/01/2021 is relevant with a view to maintaining rights in the EU and will be taken into account.

ASSESSMENT OF GENUINE USE – FACTORS

 

Time of use

The evidence must show genuine use of the contested EUTM within the relevant period.

All of the evidence of use, namely the invoices, catalogues, leaflets and distributorship agreements, is dated within the relevant period (between 05/07/2012 and 04/07/2017). Therefore, the evidence of use filed by the EUTM proprietor contains sufficient indications concerning the time of use.

Place of use

The evidence must show that the contested EUTM has been genuinely used in the European Union (see Article 18(1) EUTMR and Article 58(1)(a) EUTMR).

The agreements, invoices, catalogues and leaflets show that the place of use is at least Belgium, Greece, Spain, France, Italy, Poland, Portugal and Romania. This can be inferred from the language of the documents (English, French, Italian, Polish and Spanish), and/or the currency mentioned (euros) and/or some addresses in those countries. Therefore, the evidence relates to the relevant territory.

 

Nature of use: use as a trade mark

 

Nature of use requires, inter alia, that the contested EUTM is used as a trade mark, that is, for identifying origin, thus making it possible for the relevant public to distinguish between goods and services of different providers.

In the present case, considering the use of the trade mark on the goods and the catalogues, it is clear that the sign has been used as a trade mark in order to distinguish the goods of the EUTM proprietor.

Nature of use: use of the mark as registered

 

‘Nature of use’ in the context of Article 10(3) EUTMDR further requires evidence of use of the mark as registered, or of a variation thereof which, pursuant to Article 18(1)(a) EUTMR, does not alter the distinctive character of the contested EUTM. 

 

The purpose of Article 18(1)(a) EUTMR, which avoids imposing strict conformity between the form in which the trade mark is used and the form in which it was registered, is to allow its proprietor, when exploiting it commercially, to vary it in such a way that, without altering its distinctive character, enables it to be better adapted to the marketing and promotion requirements of the goods or services concerned (23/02/2006, T-194/03, Bainbridge, EU:T:2006:65, § 50).

 

It is appropriate to consider whether the form in which the contested trade mark is used contains differences which affect its distinctive character or whether, despite the differences, the mark used and the contested EUTM have the same distinctive character. First, the distinctive character of the contested EUTM must be clarified. Then, it must be considered whether or not the mark as used alters this distinctive character.

 

Assessment of the distinctive or dominant character of one or more components of a complex trade mark must be based on the intrinsic qualities of each of those components, as well as on the relative position of the different components within the trade mark (24/11/2005, T‑135/04, Online Bus, EU:T:2005:419, § 36).

The mark was registered with the following depiction: .

The catalogues, labels and goods feature the trade marks , or , in black and white, green, or red.

The Board of Appeal indicated that both the verbal element ‘STAYER’ and the figurative element in the shape of a horse’s head are neither meaningful nor allusive for the contested goods and, therefore, are distinctive (07/09/2018, R 1940/2017‑5, Stayer (fig.) § 43).

It is clear that the change in position of the figurative element at the beginning of the mark and the change in colour of the elements are not so significant as to have an impact on the overall impression of the sign as registered. Therefore they do not change the distinctive character of the mark. The consumer will still be able to perceive that the goods in question originate from the same undertaking, which has registered and used the contested EUTM.

Some of the discs/wheels feature the trade mark on one of their sides. However, most of the time these discs/wheels are sold packaged or are presented on display cases bearing the sign (e.g. documents 2 d, 2e, 2p and 4b).

Therefore, it is considered that, in the context of the evidence as a whole, the documents submitted show use of the contested EUTM as registered or in a form which does not alter its distinctive character.

Extent of use

 

Concerning extent of use, it is settled case-law that account must be taken, in particular, of the commercial volume of the overall use, as well as of the length of the period during which the mark was used and the frequency of use (e.g. 08/07/2004, T‑334/01, Hipoviton, EU:T:2004:223, § 35).

 

The Court has held that ‘use of the mark need not [...] always be quantitatively significant for it to be deemed genuine, as that depends on the characteristics of the goods or service concerned on the corresponding market’ (11/03/2003, C-40/01, Minimax, EU:C:2003:145, § 39). 

 

It is not possible to determine a priori, and in the abstract, what quantitative threshold should be chosen in order to determine whether use is genuine or not. A de minimis rule cannot therefore be laid down. When it serves a real commercial purpose, even minimal use of the mark can be sufficient to establish genuine use (27/01/2004, C-259/02, Laboratoire de la mer, EU:C:2004:50, § 25, 27).

 

The assessment of genuine use entails a degree of interdependence between the factors taken into account. Thus, the fact that commercial volume achieved under the mark was not high may be offset by the fact that use of the mark was extensive or very regular, and vice versa. Likewise, the territorial scope of the use is only one of several factors to be taken into account, so that a limited territorial scope of use can be counteracted by a more significant volume or duration of use.

 

The applicant argued that the invoices only show internal use, within the EUTM proprietor’s group of companies, and that there are no outward sales to customers. In this respect, in the previously mentioned similar case (07/09/2018, R 1940/2017‑5, Stayer (fig.)), the Board concluded that there was nothing in the evidence to demonstrate that the distribution companies appearing on the invoices and the distributorship agreements were companies within the same group. Furthermore, the fact that these companies are exclusive resellers of the EUTM proprietor’s goods, does not imply that these companies are within the same group.

The invoices to distributors show substantial sales of goods. The price of each product is low, but the volume of sales is important. Moreover, frequent sales in numerous countries are demonstrated during the entire relevant period.

Consequently, the Cancellation Division finds that the documents filed provide sufficient information concerning the commercial volume, the duration and the frequency of use for the contested goods.

Use in relation to the registered goods

 

Article 58(1)(a) EUTMR and Article 10(3) EUTMDR require that the EUTM proprietor proves genuine use for the contested goods and services for which the European Union trade mark is registered.

The use of the brackets in the list of goods has the effect of restricting the scope of protection sought solely to ‘discs and wheels’, which are included in the category of ‘hand held abrasive instruments’. The contested mark has been registered in respect of ‘discs and wheels’ per se, and not in respect of all or only some types of hand-held instruments to which those discs and wheels may be connected (28/05/2020, T‑681/18, Stayer (fig.), EU:T:2020:222, § 26).

The applicant argued that the EUTM proprietor had decided to register the discs and wheels in Class 8, as accessories to hand-operated tools. Therefore, it had to prove that the abrasive discs and grinding wheels were meant to be inserted into hand-operated abrasive instruments and not power tools (even if they were hand-held tools), which fall within Class 7.

However, the Court judged that it would be contrary to the purpose of the EUTMR to require the EUTM proprietor to provide evidence of use of ‘discs and wheels’ (which fall within the category of ‘abrading instruments [hand instruments]’ in Class 8 of the Nice Classification) in relation to a particular type of tool into which those discs wheels may be inserted, even though it is clear from the evidence submitted that those wheels have been marketed and sold as such (28/05/2020, T‑681/18, Stayer (fig.), EU:T:2020:222, § 41).

The Court also added that the distinction suggested by the applicant is irrelevant since the wheels at issue have the same characteristics overall, namely that they are capable of wearing something away by means of rubbing, irrespective of the type of tools into which they may be inserted. Consequently, those goods constitute a sufficiently homogeneous category of goods, and a sub-categorisation on the basis of the various types of tools is not necessary in order to assess the proof of use of the contested mark (28/05/2020, T‑681/18, Stayer (fig.), EU:T:2020:222, § 32).

Therefore, the EUTM proprietor has shown use for all the goods for which the mark is registered.

Overall assessment

 

In order to examine, in a given case, whether use of the mark is genuine, an overall assessment must be made taking account of all the relevant factors in the particular case. That assessment implies a certain interdependence between the factors taken into account. Thus, a low volume of goods marketed under that trade mark may be compensated for by high intensity of use or a certain constancy regarding the time of use of that trade mark or vice versa (08/07/2004, T-334/01, Hipoviton, EU:T:2004:223, § 36).

 

In the present case, the Cancellation Division considers that genuine use of the contested mark has been sufficiently demonstrated for the relevant factors. 

 

 

Conclusion

 

It follows from the above that the EUTM proprietor has proven genuine use for all the contested goods. Consequently, the application for revocation must be rejected as unfounded.

 

 COSTS

 

According to Article 109(1) EUTMR, the losing party in cancellation proceedings must bear the fees and costs incurred by the other party.

 

Since the applicant is the losing party, it must bear the costs incurred by the EUTM proprietor in the course of these proceedings.

 

According to Article 109(7) EUTMR and Article 18(1)(c)(ii) EUTMIR, the costs to be paid to the EUTM proprietor are the representation costs, which are to be fixed on the basis of the maximum rate set therein. 

 

 

The Cancellation Division

 

Frédérique SULPICE

Richard BIANCHI

Zuzanna STOJKOWICZ

 

According to Article 67 EUTMR, any party adversely affected by this decision has a right to appeal against this decision. According to Article 68 EUTMR, notice of appeal must be filed in writing at the Office within two months of the date of notification of this decision. It must be filed in the language of the proceedings in which the decision subject to appeal was taken. Furthermore, a written statement of the grounds of appeal must be filed within four months of the same date. The notice of appeal will be deemed to be filed only when the appeal fee of EUR 720 has been paid.