Partial refusal of application for a European Union trade mark

(Article 7 EUTMR and Rule 11(3) EUTMIR)

Alicante, 10/11/2016

MACROBERTS LLP

Excel House

30 Semple Street

Edinburgh Lothian EH3 8BL

REINO UNIDO

Application No:	015611924
Your reference:	CHDGKIL/22/26
Trade mark:	100% Islay
Mark type:	Word mark
Applicant:	KILCHOMAN DISTILLERY COMPANY LTD Rockside Farm Bruichladdich Isle of Islay PA49 7UT REINO UNIDO

The Office raised an objection on 22/07/2016 pursuant to Article 7(1)(b) EUTMR and Article 7(2) EUTMR because it found that the trade mark applied for is devoid of any distinctive character for the reasons set out in the attached letter. Attach L110

The applicant submitted its observations on 21/09/2016, which may be summarised as follows:

• In accordance with Article 7(3) EUTMR, a trade mark may still be registered despite is not complying with Article 7(1)(b) EUTMR, provided that it ‘has become distinctive in relation to the goods or services for which registration is requested in consequence of the use which has been made of it’. Accordingly, the applicant has submitted evidence and states that the mark applied for has acquired distinctive character owing to the use made of it on the market such that the relevant public has come to see the mark as identifying the goods claimed in the application as originating from the applicant.

Pursuant to Article 75 EUTMR, it is up to the Office to take a decision based on reasons or evidence on which the applicant has had an opportunity to present its comments.

After giving due consideration to the applicant’s arguments, the Office has decided to maintain the objection.

The applicant failed to submit observations in relation to the arguments related to Article 7(1)(b) EUTMR stated by the Office in the notification dated 22/07/2016. For the reasons set out in the letter of objection, and pursuant to Article 7 (1) (b) EUTMR, the application for European Union trade mark No 15 611 924 is hereby rejected for the goods objected to.

Further, in order to overcome the objection based on Article 7(1)(b) EUTMR, the applicant has provided the following evidence in relation to Article 7(3) EUTMR:

• The applicant’s distillery (Kilchoman) was built in 2005. It is one of the smallest distilleries in Scotland with an annual production of approximately 120.000 litres of alcohol. Kilchoman is one of only six distilleries to carry out traditional floor maltings.

• The Scotch whisky product known as ‘100% Islay’ was first launched by the applicant in 2001. The trade mark has been in continuous use since the launch. A new edition of the ‘100% Islay’ whisky is released each year and 2016 marks the sixth edition. Approximately 12.000 bottles of ‘100% Islay’ Scotch whisky are released annually. This represents approximately 5% of sales volume and 9% of turnover of the applicant.

• Since the launch of the product in 2011 the applicant has won a series of prestigious industry leading awards for Scotch whisky products under the mark ‘100% Islay’ such as:

• 2013. 100% Kilchoman Islay 2^nd Edition Single Malt Scotch Whisky: Bronze Medal from the International Wine & Spirit Competition.

• 2015. 100% Islay 4^th Edition: Silver Medal from the International Wine & Spirit Competition.

• 2016. Kilchoman 100% Islay 2010: Silver Outstanding from the International Wine & Spirit Competition.

• The applicant’s advertising and PR budget for 2016 is significant at £150.000 with a further £119.000 allocated for travel to assist with visits to supplies, sellers’ trade shows and whisky clubs to promote all the applicant’s brands and products.

• The trade mark was featured in an article in ‘The Scotsman’ newspaper first published on 6 January 2014.

• The trade mark is also referenced in the ‘Wikipedia’ entry for the applicant. Searches for ‘100% Islay’ on leading search engines all return pages of search results relating to the ‘100% Islay’ product at the Kilchoman distillery.

• In line with the foregoing, distinctiveness through use was acquired prior to the application’s filing dated.

In relation to the submitted documents, the Office points out as follows:

Under Article 7(3) [EUTMR], the absolute grounds for refusal laid down in Article 7(1)(b) to (d) of that regulation do not preclude registration of a mark if, in relation to the goods or services for which registration is requested, it has become distinctive in consequence of the use which has been made of it. In the circumstances referred to in Article 7(3) EUTMR, the fact that the sign which constitutes the mark in question is actually perceived by the relevant section of the public as an indication of the commercial origin of a product or service is the result of the economic effort made by the trade mark applicant. That fact justifies putting aside the public-interest considerations underlying Article 7(1)(b) to (d) [EUTMR], which require that the marks referred to in those provisions may be freely used by all in order to avoid conceding an unjustified competitive advantage to a single trader … .

First, it is clear from the case-law that the acquisition of distinctiveness through use of a mark requires that at least a significant proportion of the relevant section of the public identifies the products or services as originating from a particular undertaking because of the mark. However, the circumstances in which the condition as to the acquisition of distinctiveness through use may be regarded as satisfied cannot be shown to exist solely by reference to general, abstract data such as specific percentages … .

Second, in order to have the registration of a trade mark accepted under Article 7(3) EUTMR, the distinctive character acquired through the use of that trade mark must be demonstrated in the part of the European Union where it was devoid of any such character under Article 7(1)(b) to (d) of that regulation … .

Third, in assessing, in a particular case, whether a mark has become distinctive through use, account must be taken of factors such as, inter alia: the market share held by the mark, how intensive, geographically widespread and long-standing use of the mark has been, the amount invested by the undertaking in promoting the mark, the proportion of the relevant class of persons who, because of the mark, identify goods as originating from a particular undertaking and statements from chambers of commerce and industry or other trade and professional associations. If, on the basis of those factors, the relevant class of persons, or at least a significant proportion thereof, identify goods as originating from a particular undertaking because of the trade mark, it must be concluded that the requirement for registering the mark laid down in Article 7(3) EUTMR is satisfied … .

Fourth, according to the case-law, the distinctiveness of a mark, including that acquired through use, must also be assessed in relation to the goods or services in respect of which registration is applied for and in the light of the presumed perception of an average consumer of the category of goods or services in question, who is reasonably well-informed and reasonably observant and circumspect … .

(10/11/2004, T‑396/02, Karamelbonbon, EU:T:2004:329, § 55-59; 04/05/1999, C‑108/97 & C‑109/97, Chiemsee, EU:C:1999:230, § 52; 22/06/2006, C‑25/05 P, Bonbonverpackung, EU:C:2006:422, § 75; and 18/06/2002, C‑299/99, Remington, EU:C:2002:377, § 63).

In the present case all the documents submitted are in English and refer to the relevant period.

The evidence submitted does not refer to all the goods objected to (Scotch whisky; Gin; Liqueurs; Bramble Liqueur) but only to Scotch whisky.

Where the EUTM applied for is rejected with respect to its meaning in specific language, acquired distinctiveness through use must be shown with respect to the Member States in which that language is an official language. The objection dated 22/07/2016 stated that the relevant public is at least the average English-speaking consumer in the Union, namely average consumers from the United Kingdom, Ireland and Malta.

The applicant declares that approximately 12.000 bottles of ‘100% Islay’ Scotch whisky are released annually. The price list (Annex 3) just show prices of the different types of whisky units. Furthermore, the invoices (Annex 4) show sales in Germany, Malta (only 4 units of ‘100% Islay’ amounting £578), Italy, and Sweden. However, there is no evidence showing sales in the different English-speaking countries of the European Union apart from the irrelevant figures from Malta. Although the annual production is related to the mark at issue, the figure of 12.000 bottles of ‘100% Islay’ Scotch whisky do no enable to assess the share of the relevant market held by the applicant in respect of the mark applied for. A realistic assessment of market strength is impossible in the absence of data on the total volume of the relevant goods market or assessments of the sales of competitors with which the applicant’s figures could be compared.

Further, in so far as the applicant relies on the success of its awards certificates from the International Wine & Spirit Competition, which success is, moreover, not disputed by the Office, it must be stated that the fact that a competition is successful does not mean that the mark at issue is perceived as a trade mark in the sense that it would enable the relevant class of consumers immediately to identify a trade mark which has won an award with its commercial origin and to dissociate it from other undertakings.

It is established that the sign ‘100% Islay’ is used in order to designate the applicant’s origin and quality of the goods, that is to say that they are totally or authentically from the Scottish island of Islay. Consequently, the Office was fully entitled to hold that the fact that the applicant’s possess several awards is not, on its own, sufficient to prove that the mark applied for had acquired distinctive character or that it is perceived as a trade mark and not as a promotional expression.

Moreover, the Office highlights that, according to the General Court, a distinction must be made between “direct proof” of acquisition of distinctive character (surveys, evidence on the market shares held by the mark, statements from chambers of commerce and industry or other trade and professional associations) and “secondary evidence” (sales volumes and advertising material, duration of use) that are merely indicative of the mark’s recognition on the market. Though secondary evidence may serve to corroborate direct proof, it cannot substitute it. In the case at hand, all the documents provided would be considered as secondary evidence. The documents submitted show that the applicant has a commercial activity in relation to Scotch whisky. However, the Office points out that there is no constancy of factors such as, inter alia, the market share held by the mark, turnover, statements from chambers of commerce and industry or other trade and professional associations, or the proportion of the relevant class of persons who, because of the mark, identify the goods as originating from a particular undertaking.

The copies of documents and links submitted cannot constitute evidence that the relevant consumer in the European Union, through familiarity with the mark ‘100% Islay’ on the market, has come to perceive it as a badge of origin, capable of distinguishing the goods of the applicant from those of other traders.

It follows from the foregoing that the Office considers that the applicant has failed to adequately demonstrate that in the English-speaking countries of the European Union, the trade mark in question, at the date of its filing, had become distinctive in consequence of the use which has been made of it within the meaning of Article 7(3) EUTMR in respect of the goods applied for.

For the abovementioned reasons, and pursuant to Article 7(1)(b) and 7(2) CTMR, the application for Community trade mark No 15 611 924 is hereby rejected for the following goods claimed:

Class 33 Scotch whisky; Gin; Liqueurs; Bramble Liqueur.

The application will be accepted for the remaining goods.

According to Article 59 EUTMR, you have a right to appeal against this decision. According to Article 60 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.

Ignacio IGLESIAS ARROYO