Refusal of application for a European Union trade mark

(Article 7 and Article 42(2) EUTMR)

Alicante, 26/10/2017

LEWIS SILKIN LLP

5 Chancery Lane

Clifford's Inn

London EC4A 1BL

UNITED KINGDOM

Application No:	16 728 404
Your reference:	AAN/102358
Trade mark:	CARO
Mark type:	Word mark
Applicant:	Enterprise Holdings, Inc. 600 Corporate Park Drive St. Louis, Missouri 63105 UNITED STATES OF AMERICA

The Office raised an objection on 22/05/2017, pursuant to Article 7(1)(b) and (c) and Article 7(2) EUTMR, because it found that the trade mark applied for is descriptive and devoid of any distinctive character in relation to all the services for which registration was sought, for the reasons set out in the attached notice of provisional refusal.

The applicant submitted its observations within the extended time limit, on 27/09/2017, which may be summarised as follows:

1. The objection against the mark applied for, ─ ‘CARO’ ─, was raised incorrectly. The Office has examined the mark as if the trade mark application had been filed for vehicles in Class 12, but it was not. Registration is sought for vehicle rental and leasing services in Class 39, and the price of the rented or leased vehicle is unknown and entirely irrelevant to the end users of these services, because they are not purchasing the vehicle.

2. The word ‘CARO’ is unlikely to be understood with the meaning ‘expensive’ in any language in respect of the services for which registration is sought. It is not a positive attribute for rental and leasing vehicle services, a sector where competition is aggressive.

3. Vehicle rental and leasing services are provided mainly in respect of cars. The word ‘car’ is an English word, but it is understood to mean an automobile in every European country. It is one of the few English words that means the same in Dutch, English, French, German, Italian, Portuguese, Spanish, etc. Therefore, this word, when viewed as a trade mark in respect of car rental and leasing services, would be seen first and foremost as the word ‘car’ with an additional letter ‘o’ at the end. This is how the mark has been used in the EU to date (Annex 1).

4. If the end users of the rental and leasing services do understand the word ‘caro’ with the meaning ‘expensive’, they will perceive it as a surprising, ironic and self-deprecating suggestion and will not take it at face value.

5. Annex 3 demonstrates that the word ‘expensive’ is registrable and has been accepted in a number of countries, inside and outside the EU. It is a well-known and accepted principle of EU trade mark law that trade marks that contain a play on words, or are surprising or ironic, are acceptable for registration.

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.

The Office has re-considered the mark applied for in accordance with the case-law mentioned below, and, after giving due consideration to all of the applicant’s arguments, maintains that it is not capable of functioning as a badge of the commercial origin for the services for which registration is sought. Accordingly, the Office reiterates that the mark conveys immediately apparent information regarding the characteristic of vehicles, that are the subject matter of rental and leasing services and reservation services for the rental and leasing of vehicles for which registration is sought, namely that the vehicles in question are expensive, or that these services relate to expensive vehicles.

It is settled case-law that each of the grounds for refusal to register listed in Article 7(1) EUTMR is independent and requires separate examination. Moreover, it is appropriate to interpret those grounds for refusal in the light of the general interest underlying each of them. The general interest to be taken into consideration when examining each of those grounds for refusal may or even must reflect different considerations according to the ground for refusal in question (08/05/2008, C-304/06 P, Eurohypo, EU:C:2008:261, § 55; 16/09/2004, C‑329/02 P, SAT.2, EU:C: 2004:532, § 25).

Under Article 7(1)(b) EUTMR, ‘trade marks which are devoid of any distinctive character’ are not to be registered.

Under Article 7(1)(c) EUTMR, ‘trade marks which consist exclusively of signs or indications which may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods or of rendering of the service, or other characteristics of the goods or service’ are not to be registered.

‘The signs and indications referred to in Article 7(1)(c) [EUTMR] are those which may serve in normal usage from the point of view of the target public to designate, either directly or by reference to one of their essential characteristics, the goods or service in respect of which registration is sought’ (26/11/2003, T‑222/02, Robotunits, EU:T:2003:315, § 34).

By prohibiting the registration as European Union trade marks of the signs and indications to which it refers, Article 7(1)(c) EUTMR

pursues an aim which is in the public interest, namely that descriptive signs or indications relating to the characteristics of goods or services in respect of which registration is sought may be freely used by all. That provision accordingly prevents such signs and indications from being reserved to one undertaking alone because they have been registered as trade marks.

(23/10/2003, C‑191/01 P, Doublemint, EU:C:2003:579, § 31).

A word mark that is descriptive of characteristics of goods or services for the purposes of Article 7(1)(c) EUTMR is, on that account, necessarily devoid of any distinctive character with regard to the same goods or services within the meaning of Article 7(1)(b) EUTMR (12/06/2007, T-190/05, Twist & Pour, EU:T:2007:171, § 39).

As regards the applicant’s first argument, the Office confirms that the mark was examined in accordance with settled case-law, that is, in relation to the services for which registration is sought and the perception of potential users thereof (27/11/2003, T-348/02, Quick, EU:T: 2003:318, § 29). The Office found that the Italian, Portuguese and Spanish-speaking average consumers in the European Union, when encountering the mark applied for in relation to the services concerned, would understand immediately and without any mental effort that they relate to expensive vehicles.

In this regard, the Office points out that even a simple “Google” search demonstrates that services offering leasing and rental of expensive cars are available on the market, and that potential consumers are already familiar with them; some examples of this use are shown below:

(information extracted on 23/10/2017 from https://www.google.es/search?q=leasing+of+expensive+cars&oq=leasing+of+expensive+cars&aqs=chrome..69i57j0.7940j0j7&sourceid=chrome&ie=UTF-8 ; http://help.iris.co.uk/IRIS/ODL/Product_Help/Business_Tax_Trades/Edit/iwinttaxLeased_Expensive_Cars.htm )

(information extracted on 23/10/2017 from https://www.google.es/search?q=leasing+of+expensive+cars&oq=leasing+of+expensive+cars&aqs=chrome..69i57j0.7940j0j7&sourceid=chrome&ie=UTF-8 ; https://www.quora.com/Why-do-rich-people-who-can-easily-afford-expensive-cars-rent-them-instead )

(information extracted on 23/10/2017 from https://www.google.es/search?q=leasing+of+expensive+cars&oq=leasing+of+expensive+cars&aqs=chrome..69i57j0.7940j0j7&sourceid=chrome&ie=UTF-8 )

(information extracted on 23/10/2017 from https://www.google.es/search?q=leasing+of+expensive+cars&ei=GHfqWbuOOsf1at_4krgF&start=10&sa=N&biw=1093&bih=530 ; http://taxability.toyota.co.uk/LeasingDisallowance.html )

These examples also make it clear that the price of cars offered for rental or leasing, contrary to the applicants arguments, is not irrelevant to users of the services concerned, and that they prefer renting and leasing expensive cars, rather than cheap ones, for a number of reasons, including that ‘“leasing allows consumers to drive a more expensive car for the same monthly payment, and for those who can afford it, enables them to drive a new car every two to three years that s fully covered under a manufacture’s warranty”’.

The applicant is correct in stating that ‘caro’ is not a positive attribute for rental and leasing vehicle services. However, in the present case, the word ‘caro’ would be perceived as referring to the vehicles that are rented or leased, and not as the attribute of the services themselves.

Regarding the applicant’s third argument, the Office does not find any reasons why Italian, Portuguese and Spanish users of rental and leasing services would perceive the word ‘caro’ as a misspelling of the English word ‘car’ used in the mark to describe that the services in question relate to ‘an automobile’, and not as a word in their own language, with which are they familiar.

Concerning the applicant’s fourth argument, the Office highlights that the applicant itself describes it is highly unlikely that providers of rental and leasing services would use the word ‘caro’ to emphasise that their services are expensive, when advertising and offering the services. They are aware that it would make them less competitive than others providers of the services concerned. Potential users of the services in question are also aware of that fact and, therefore, it is highly unlikely that they would perceive the mark as referring to the prices of the services themselves, or as surprising, ironic and self-deprecating.

As far as the applicant’s final argument is concerned, first, it must be emphasised that, according to settled case-law, ‘decisions concerning registration of a sign as a European Union trade mark … are adopted in the exercise of circumscribed powers and are not a matter of discretion’. Accordingly, the registrability of a sign as a European Union trade mark must be assessed solely on the basis of the EUTMR, as interpreted by the Union judicature, and not on the basis of previous Office practice (15/09/2005, C‑37/03 P, BioID, EU:C:2005:547, § 47; and 09/10/2002, T‑36/01, Glass pattern, EU:T:2002:245, § 35).

Second, none of the trade marks to which the applicant refers is registered as a European Union trade mark.

Furthermore, according to the principles of the EU trade mark law:

‘the fact that the sign at issue can have several meanings, that it can be a play on words and that it can be perceived as ironic, surprising and unexpected, does not suffice to make it distinctive. Those various elements only make that sign distinctive in so far as it is immediately perceived by the relevant public as an indication of the commercial origin of the applicant’s goods and services, and so as to enable the relevant public to distinguish, without any possibility of confusion, the applicant’s goods and services from those of a different commercial origin.

(15/09/2005, T‑320/03, Live richly, EU:T:2005:325, § 84).

The Office does not find these principles applicable in the present case. A mark consisting of one word, such as the mark ‘CARO’, cannot be seen as a play on word, and, for all the reasons already described, it will not be perceived as ironic or surprising.

For all the reasons given above and in the notice of provisional refusal, and pursuant to Article 7(1)(b) and (c) and Article 7(2) EUTMR, the application for European Union trade mark No 16 728 404 is hereby refused for all the services for which registration is sought.

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. 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.

Mirjana PUSKARIC