CANCELLATION No 33 803 C (REVOCATION)

Nero Hotels S.R.L., Galleria del Corso 2, 20122 Milan, Italy (applicant), represented by Bresner Cammareri Intellectual Property – BCIP, Via Aurelio Saffi 23, 20123 Milan, Italy (professional representative)

a g a i n s t

Ariel Park, S.L., Avda. L’Atmella de Mar, 12 - Hotel Nereo, 03503 Benidorm (Alicante), Spain (EUTM proprietor), represented by Polopatent, Dr. Fleming, 16, 28036 Madrid, Spain (professional representative).

On 18/06/2020, the Cancellation Division takes the following

DECISION

1. The application for revocation is upheld.

2. The EUTM proprietor’s rights in respect of European Union trade mark No 11 348 174 are revoked in their entirety as from 07/03/2019.

3. The EUTM proprietor bears the costs, fixed at EUR 1 080.

REASONS

The applicant filed a request for revocation of European Union trade mark registration No 11 348 174 ‘HOTEL NEREO’ (word mark) (the EUTM). The request is directed against all the services covered by the EUTM, namely:

Class 39: Online centres for booking of seats for travel; seat reservation services; transport and travel arrangement services; travel arrangement; travel information services; travel guide services; services consisting of the organisation and packaging of products for travel, tours and holidays.

Class 41: Entertainment; arranging and conducting of entertainment programmes, sporting and cultural activities, reservation of seats for shows and offers for leisure activities.

Class 43: Online centres for booking of temporary accommodation; services for providing food and drink; temporary accommodation.

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

SUMMARY OF THE PARTIES’ ARGUMENTS

The applicant claimed that the contested mark had not been put to genuine use for a continuous period of five years in relation to all the services for which the contested mark was registered.

The EUTM proprietor submitted evidence of use (listed and assessed below).

In reply, the applicant argued that the contested EUTM had not been genuinely used and criticised each piece of evidence taken individually. In particular, it argued that:

• some pieces of evidence were undated or dated after the relevant period;

• some pieces of evidence were not (fully) translated into English;

• the company reports submitted in Exhibit 4 were internal documents emanating from the EUTM proprietor and could have been easily edited;

• the EUTM proprietor did not submit any piece of evidence to show the extent of the use such as invoices;

• the nature of use had not been proved since the signs used were ‘HOTEL SERVIGROUP NEREO’ / but not ‘HOTEL NEREO’.

• use took place only in one Spanish city (Benidorm) and did not constitute use for the whole European Union.

In its final observations, the EUTM proprietor argued that the evidence had to be assessed on its entirety and not individually. It pointed out that Benidorm is a key touristic destination registering a total of 11 million hotel overnight stays in 2015, according to the figures from the National Statistics Institute (INE). It also argued that ‘HOTEL NEREO’ was used as a trade mark independently from ‘SERVIGROUP’, which was the house mark used to identify the hotel chain. Therefore, the additional element ‘SERVIGROUP’ did not alter the distinctive character of the contested EUTM as registered. It considered that the relevant parts of Exhibit 4 were duly translated and that the presence of ‘HOTEL NEREO’ in the most relevant online booking engines, the awards granted and the customer reviews clearly demonstrated use of the contested EUTM for the services in Classes 39, 41 and 43. The EUTM proprietor also submitted additional evidence (listed and assessed below).

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, 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 earlier 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 17/04/2013. The revocation request was filed on 07/03/2019. 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 07/03/2014 to 06/03/2019 inclusive, for the contested services listed in the section ‘Reasons’ above.

On 19/08/2019, the EUTM proprietor submitted the following evidence as proof of use:

• Exhibit 1: printouts from the company website www.servigroup.com printed out on 19/08/2019, with the description of the ‘Hotel Servigroup Nereo’ in Benidorm;

• Exhibit 2: undated pictures of ‘HOTEL NEREO’, with the sign depicted as follows on the building ;

• Exhibit 3: undated PDF brochure of ‘HOTEL SERVIGROUP NEREO’, the sign is also depicted as ;

• Exhibit 4: company reports from the proprietor ARIEL PARK, S.L. from 2013, 2014, 2015, 2016 and 2017, in Spanish, partially translated into English in the EUTM proprietor’s observations;

• Exhibit 5: five tax documents from 2014, 2015, 2016, 2017 and 2018 from SUMA (a public body that administers and collects municipal taxes for the town/city councils of the province of Alicante);

• Exhibit 6: two communications from the territorial tourism service of the ‘Generalitat Valenciana’ from 2013 and 2015, in Spanish;

• Exhibit 7: undated advertisement of the hotel rates showing the prices for ‘desayuno’ (breakfast), ‘almuerzo’ (lunch) y ‘pension completa’ (breakfast, lunch and dinner). Prices of single and double rooms are also given;

• Exhibit 8: printouts from the webpage www.servigroup.com, printed out on 19/08/2019, showing that ‘Hotel Nereo’ won the third prize of the Christmas decoration competition on 26/12/2018;

• Exhibit 9: printouts from www.trivago.es, www.atrapalo.com, www.booking.com and www.tripadvisor.es related to the hotel ‘Servigroup Nereo’ (possibility to book hotel services on these websites and clients’ reviews);

• Exhibit 10: press article in Spanish from www.expresso.info, dated 02/03/2017, related to an award granted to Servigroup chain of hotels, by the company ‘Booking.com’.

On 11/03/2020, after expiry of the time limit, the EUTM proprietor submitted the following additional evidence:

• Exhibit 11: press article dated 02/02/2016 from https://english.elpais.com entitled ‘Benidorm breaks its own record for overnight hotel stays. More than 11 million people visited the popular Costa Blanca resort last year, says report’ and press article dated 19/08/2019 from www.thinkspain.com entitled ‘Benidorm, Barcelona, Ibiza and Marbella among top 2019 hen and stag destinations’;

• Exhibit 12: extracts from Wayback Machine related to the printouts from the website www.servigroup.com for ‘SERVIGROUP NEREO HOTEL’, dated 2015, 2016 and 2017.

Even though, according to Article 19(1) EUTMDR, the EUTM proprietor has to submit proof of use within a time limit set by the Office, Article 10(7) EUTMDR (applicable to cancellation proceeding by virtue of Article 19(1) EUTMDR) expressly invites the Office to exercise its discretionary power if relevant evidence was submitted in time and, after the expiry of the time limit, supplementary evidence was filed.

According to Article 10(7) EUTMDR, where, after the expiry of the time limit set by the Office, indications or evidence are filed that supplement prior relevant indications or evidence submitted within the time limit, the Office may take into account the evidence submitted out of time, as a result of exercising the discretion conferred on it by Article 95(2) EUTMR. When exercising its discretionary power, the Office must take into account, in particular, the stage of proceedings and whether the facts or evidence are, prima facie, likely to be relevant for the outcome of the case and whether there are valid reasons for the late submission of the facts or evidence.

In this regard, the Cancellation Division considers that the EUTM proprietor did submit relevant evidence within the time limit initially set by the Office and, therefore, the later evidence can be considered to be additional.

The fact that the applicant disputed the initial evidence submitted by the EUTM proprietor justifies the submission of additional evidence in reply to the objection (29/09/2011, T‑415/09, Fishbone, EU:T:2011:550, § 30, 33; 18/07/2013, C‑621/11 P, Fishbone, EU:C:2013:484, § 36).

For the above reasons, and in the exercise of its discretion pursuant to Article 95(2) EUTMR, the Cancellation Division therefore decides to take into account the additional evidence submitted on 11/03/2020. However, since the additional evidence cannot change the outcome in the present proceedings and does not prejudice the applicant, the Cancellation Division does not consider it necessary to reopen the proceedings for another round of observations for these particular documents.

Assessment of genuine use — factors

General considerations

The indications and evidence required in order to provide proof of use must consist of indications concerning the place, time, extent and nature of use of the trade mark for the relevant goods and/or services.

These requirements for proof of use are cumulative (05/10/2010, T‑92/09, STRATEGI, EU:T:2010:424, § 43). This means that the EUTM proprietor is obliged not only to indicate but also to prove each of these requirements. However, the sufficiency of the indication and proof as to the place, time, extent and nature of use has to be considered in view of the entirety of the evidence submitted. A separate assessment of the various relevant factors, each considered in isolation, is not suitable (17/02/2011, T‑324/09, Friboi, EU:T:2011:47, § 31).

At this point, the Cancellation Division considers it appropriate to focus the assessment of the evidence on the criteria of extent of use; in its opinion, the evidence submitted by the EUTM proprietor is insufficient to prove that this requirement has been met.

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 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.

Assessing the circumstances of the case may include giving consideration, inter alia, to the nature of the goods or services, the characteristics of the market concerned and the scale and frequency of use of the mark (11/03/2003, C‑40/01, Minimax, EU:C:2003:145, § 39).

The evidence submitted by the EUTM proprietor shows use of the sign ‘HOTEL NEREO’ in relation to hotel services provided in one hotel located in Benidorm (Alicante), Spain. The evidence does not show use of the sign in other establishments in Spain or in the European Union.

The EUTM proprietor argued that Benidorm is a very popular destination with tourists coming from all over the European Union. Although this has been proved by the EUTM proprietor, the territorial scope of the use of the mark demonstrated by the EUTM proprietor is limited to one establishment. Considering the nature of the services (hotel services), and the mass market concerned in the European Union, the use of the trade mark in only one hotel in Benidorm is considered geographically extremely limited. In any case, this very limited geographical extent is not counteracted by a more significant volume or duration of use or the well-known character of the establishment in the European Union. Although Benidorm is a popular touristic destination in the Costa Blanca, this does not mean that this popularity can be automatically transferred to the Hotel Nereo. Furthermore, although, according to Exhibit 11, Benidorm had more than 11 million hotel overnight stays in 2015, it is not possible to make any assumptions regarding the market share of Hotel Nereo, which is a rather small establishment with only 200 rooms.

As argued by the applicant, the EUTM proprietor has not submitted evidence showing the actual commercialisation of the services. The Cancellation Division was not provided with any invoices, sales figures for the relevant services or any documents concerning the frequency of use.

Indeed, although the EUTM proprietor has submitted company reports (Exhibit 4) with, for instance, the investments made by the EUTM proprietor in the hotel Nereo, there is no indication of the number of clients, the numbers of rooms rented out during the relevant period or the number of bookings made (directly with the EUTM proprietor or through third parties websites) during the relevant period. Furthermore, the EUTM proprietor has not shown that it developed any advertising activity in order to ensure that its business establishment was promoted.

As pointed out by the applicant, the company reports seem to be internal documents issued by the EUTM proprietor. Therefore, their probative value is rather limited and they should be corroborated by objective evidence originating from independent sources such as invoices or other commercial documents.

The tax documents submitted in Exhibit 5 only show that the EUTM proprietor paid taxes but do not show the commercial activities carried on by the EUTM proprietor nor their extent. The press articles submitted by the EUTM proprietor merely relate to Benidorm as a tourist destination and Exhibit 10 refers to an award granted to Servigroup chain of hotels, by the company ‘Booking.com’.

Moreover, although Exhibit 9 shows that ‘HOTEL NEREO’ is present in booking platforms such as www.trivago.es, www.atrapalo.com, www.booking.com and www.tripadvisor.es, it does not show that bookings have effectively been made for ‘HOTEL NEREO’ during the relevant period. Furthermore, although customers left some reviews on these websites, this evidence has limited value as nowadays, almost every local business uses a review site to obtain positive feedback. Moreover, there is only one review dated within the relevant period (17/02/2015), the remaining reviews being dated before or after the relevant period.

The remaining documents such as the pictures of the hotel, the brochure of the hotel belonging to the Group Servigroup, the extracts from the EUTM proprietor’s website, the advertisement of the hotel’s rates and the communications from the territorial tourism service of the ‘Generalitat Valenciana’ are neither particularly conclusive as regards the commercial extent of the use. Although they show the existence of hotel ‘Nereo’ in Benidorm, its classification (four stars hotel) and the services provided, they do not prove that these services have been effectively commercialised to customers and to what extent. Furthermore, the mere presence of a trade mark on a website is, of itself, insufficient to prove genuine use unless the website also shows the place, time and extent of use or unless this information is otherwise provided. In the present case, the evidence does not show that the EUTM proprietor’s website has been visited and, in particular, that bookings for the relevant services have been made through the website by a certain number of customers in the relevant period.

From the evidence submitted, the Cancellation Division has no solid or objective indications relating to the extent of use (the commercial volume, the duration and the frequency of use) and it cannot be deduced if the EUTM proprietor has seriously tried to acquire a commercial position in the relevant market for the relevant services.

Although the proprietor is free to choose its means of proving the extent of use (08/07/2004, T‑203/02, Vitafruit, EU:T:2004:225, § 37), it nonetheless has to show the reality of the commercial use of the mark in the relevant territory, at least to an extent that is sufficient to dispel any possible belief that this use might be merely internal, sporadic or token.

As the Court indicated in the ‘Leno Merken’ judgment, the territorial scope of the use is only one of several factors to be taken into account in the determination of whether that use is genuine or not. It is impossible to deduce in the abstract what territorial scope should be applied in order to determine whether the use of the mark is genuine or not. All the relevant facts and circumstances must be taken into account, including the characteristics of the market concerned, the nature of the goods or services protected by the trade mark and the territorial extent and scale of the use as well as its frequency and regularity (19/12/2012, C‑149/11, Leno Merken, EU:C:2012:816, § 30, 55, 56).

However, when a business activity is located in a restricted territory such as in the present case, this needs to be compensated by a higher frequency and intensity of use.

Even taking into account the evidence as a whole, the very limited geographical extent is not compensated by other factors such as the intensity of use of the contested trade mark or the well-known character of the establishment since the indications relating to the extent of use are clearly insufficient.

Overall assessment

An overall assessment of the evidence does not allow the conclusion, without resorting to probabilities and presumptions, that the mark was genuinely used during the relevant period for the relevant services (15/09/2011, T‑427/09, Centrotherm, EU:T:2011:480, § 43).

The methods and means of proving genuine use of a mark are unlimited. The finding that genuine use has not been proven in the present case is due not to an excessively high standard of proof, but to the fact that the EUTM proprietor chose to restrict the evidence submitted (15/09/2011, T‑427/09, Centrotherm, EU:T:2011:480, § 46).

Conclusion

It follows from the above that the EUTM proprietor has not proven genuine use of the contested EUTM for any of the services for which it is registered. As a result, the application for revocation is wholly successful and the contested EUTM must be revoked in its entirety.

According to Article 62(1) EUTMR, the revocation will take effect from the date of the application for revocation, that is, as of 07/03/2019. An earlier date, on which one of the grounds for revocation occurred, may be fixed at the request of one of the parties. In the present case, the applicant has requested an earlier date. However, in exercising its discretion in this regard, the Cancellation Division considers that it is not expedient in this case to grant this request, since the applicant has not shown sufficient legal interest to justify it.

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

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

The Cancellation Division

Marta Maria CHYLIŃSKA

Frédérique SULPICE

Pierluigi M. VILLANI

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.