CANCELLATION No C 46 673 (INVALIDITY) 

 

Rental Technologies Benelux, Markhoek 51, 4835JR Breda, the Netherlands and Carpro Systems International, Markhoek 51, 4835JR Breda, the Netherlands (applicants), represented by Greenberg Traurig, LLP, Leidseplein 29, 1017 PS Amsterdam, the Netherlands (professional representative)

 

a g a i n s t

 

Create Business, Comércio e Gestão de Peças Auto e Acessórios S.A., Av. da República, piso 2, escritório 3.07, Alcoitão, 2645-143 Cascais, Portugal  (EUTM proprietor), represented by Nascimento Catarino & Associados - Sociedade de Advogados, SP, RL and Bruno Miguel Fernandes, Av. Eng. Duarte Pacheco, Torre 2 - Piso 14º - A, 1070-102 Lisbon, Portugal (professional representative).

On 10/08/2021, the Cancellation Division takes the following

 

 

DECISION

 

1.	The application for a declaration of invalidity is rejected in its entirety.

 

2.	The applicants bear the costs, fixed at EUR 450.

 

REASONS

 

On 08/10/2020, the applicants filed a request for a declaration of invalidity against European Union trade mark No 18 012 316 ‘CARPRO’ (word mark) (the EUTM). The request is directed against all the goods and services covered by the EUTM, namely against goods and services in Classes 9, 11, 12, 35 and 37. The application is based on trade names ‘CarPro’, ‘CarPro Systems’, ‘Carpro Systems International’ and ‘CarPro Systems Benelux’, all used in the course of trade in the EU, the United Kingdom, Greece, Croatia, Hungary, the Netherlands, Romania and Slovenia. The applicants invoked Article 60(1)(c) EUTMR in conjunction with Article 8(4) EUTMR.

 

 

SUMMARY OF THE PARTIES’ ARGUMENTS

 

The applicants argue that both companies are active in the field of production, supply and installation of software in the automotive industry and that the several CarPro entities conduct business throughout the entire world. The first business activity started in Israel in 2000 and headquarters have been in Breda, the Netherlands, since 2006. Within Europe, their clients reside in the Netherlands, the United Kingdom, Slovenia, Greece, Hungary, Romania and Croatia. They provide documents for the purpose of proving the use of the invoked trade names in the course of trade of more than mere local significance (listed below). They also submit extracts from laws of the Netherlands and several decisions of Dutch authorities regarding trade names. They put forward that they acquired the rights to the trade names before the filing date of the contested mark and that they have been using them also shortly before and after the filing of the invalidity request. They contend that in order to prohibit the use of the contested mark, there has to be likelihood of confusion between the trade names and the mark, a condition that is fulfilled in the present case, given the identity or near identity of the signs and the highly similar nature of their businesses.

 

The EUTM proprietor did not submit any observations in response to the invalidity application, although the Office duly invited it to do so.

 

NON-REGISTERED MARK OR OTHER SIGN USED IN THE COURSE OF TRADE ─ ARTICLE 60(1)(c) EUTMR IN CONNECTION WITH ARTICLE 8(4) EUTMR

 

The application was based on four trade names: ‘CarPro’, ‘CarPro Systems’, ‘Carpro Systems International’ and ‘CarPro Systems Benelux’, all purportedly used in the course of trade in the EU, the United Kingdom, Greece, Croatia, Hungary, the Netherlands, Romania and Slovenia, in relation to production and supply of management systems (software) with solutions and services encompassing the spectrum of the automotive industry; production and supply of additional, related software such as customer relationship management software; installation and maintenance of the above-mentioned types of software; providing of customer support with regards to the above-mentioned types of software.

The application was filed by two applicants. Since the entitlement of each of the applicants regarding each of the invoked earlier rights, as required by Article 12(2)(d) EUTMDR, was not clarified in the application, the Office invited the applicants, pursuant to Article 15(4) EUTMDR to remedy the deficiency by indicating whether the applicants are co-owners or owner and licensee as regards each of the rights invoked, or to appoint only one applicant. The applicants informed the Office that they are co-owners of the trade names ‘CarPro’ and ‘CarPro Systems’. They did not provide any information regarding the two remaining trade names. Consequently, on 19/01/2021 the Office decided that the application is admissible only as regards the two trade names ‘CarPro’ and ‘CarPro Systems’. The application is not admissible insofar as it was based on the trade names ‘Carpro Systems International’ and ‘CarPro Systems Benelux’ according to Article 15(4) EUTMDR.

Therefore, the assessment will proceed only as regards the trade names ‘CarPro’ and ‘CarPro Systems’.

The applicants, amongst others, claimed their trade names in the European Union. In this regard, it must be noted from the outset that trade names are not protected under European Union law. Therefore, such rights cannot be validly considered as the basis for an application for a declaration of invalidity on the grounds of Article 60(1)(c) EUTMR in connection with Article 8(4) EUTMR, since they do not exist as such. As a consequence, the present application must be rejected insofar as it is based on trade names ‘owned’ in the European Union.

Furthermore, in relation to the rights claimed in the United Kingdom it is noted that 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. As from 01/01/2021, UK rights ceased ex-lege to be earlier rights protected ‘in a Member State’ for the purposes of proceedings based on relative grounds. The conditions for applying Article 60(1)(c) EUTMR in conjunction with Article 8(4) EUTMR, worded in the present tense, must also be fulfilled at the time of decision taking. It follows that the United Kingdom trade names can no longer constitute a valid basis of the application for invalidity. The application must therefore be rejected as far as it is based on these earlier rights.

The assessment will continue as far as the rights claimed in the remaining territories are concerned.

According to Article 60(1)(c) EUTMR, a European Union trade mark will be declared invalid on application to the Office where there is an earlier right, as referred to in Article 8(4) EUTMR, and the conditions set out in that paragraph are fulfilled.

 

According to Article 8(4) EUTMR, upon opposition by the proprietor of a non-registered trade mark or of another sign used in the course of trade of more than mere local significance, the trade mark applied for will not be registered where and to the extent that, pursuant to Union legislation or the law of the Member State governing that sign:

 

(a)   rights to that sign were acquired prior to the date of application for registration of the European Union trade mark, or the     date of the priority claimed for the application for registration of the European Union trade mark;

 

(b)   that sign confers on its proprietor the right to prohibit the use of a subsequent trade mark.

 

Therefore, the grounds of refusal of Article 60(1)(c) EUTMR in conjunction with Article 8(4) EUTMR are subject to the following requirements:

 

 the earlier sign must have been used in the course of trade of more than local significance;

 

 pursuant to the law governing it, prior to the filing or the priority date of the contested trade mark, the applicant must have acquired rights to the sign on which the invalidity action is based, including the right to prohibit the use of a subsequent trade mark;

 

 the conditions under which the use of a subsequent trade mark may be prohibited must be fulfilled in respect of the contested trade mark.

 

The abovementioned conditions are cumulative. Therefore, where a sign does not satisfy one of those conditions, the invalidity action based on a non‑registered trade mark or other sign used in the course of trade within the meaning of Article 8(4) EUTMR cannot succeed.

 

Use in the course of trade of more than mere local significance

 

The condition requiring use in the course of trade is a fundamental requirement, without which the sign in question cannot enjoy any protection against the registration of a European Union trade mark, irrespective of the requirements to be met under national law in order to acquire exclusive rights. This requirement of Article 8(4) EUTMR is subject to EU legal standards and must be assessed accordingly, regardless of the fact that national legislation may not require actual use in the case of some specific earlier rights.

 

Furthermore, such use of the sign in question must have been of more than mere local significance. The rationale of this provision is to restrict the number of conflicts between signs by preventing an earlier sign which is not sufficiently important or significant from challenging either the registration or the validity of a European Union trade mark. A right of opposition of that kind must be reserved for signs with a real and actual presence in their relevant market. To be capable of preventing registration of a new sign, the sign relied on in opposition must actually be used in a sufficiently significant manner in the course of trade and its geographical extent must not be merely local. This implies that where the territory in which that sign is protected may be regarded as other than local, the sign must be used in a substantial part of that territory. To ascertain whether that is indeed the case, account must be taken of the duration and intensity of the use of the sign as a distinctive element for its addressees, namely purchasers and consumers as well as suppliers and competitors. In that regard, the use made of the sign in advertising and commercial correspondence is of particular relevance. The question whether the use of a non-registered sign is of more than mere local significance will be answered by applying a uniform European standard (18/04/2013, T‑506/11 & T‑507/11, Peek & Cloppenburg, EU:T:2013:197, § 19, 47-48). This applies mutatis mutandis to invalidity proceedings.

 

The General Court held that the significance of a sign used to identify specific business activities must be established in relation to the identifying function of that sign. This consideration means that account must be taken, firstly, of the geographical dimension of the sign’s significance, that is to say of the territory in which it is used to identify its proprietor’s economic activity, as is apparent from a textual interpretation of Article 8(4) EUTMR. Secondly, account must also be taken of the economic dimension of the sign’s significance, which is assessed in view of the length of time for which it has fulfilled its function in the course of trade and the degree to which it has been used, of the group of addressees among which the sign in question has become known as a distinctive element, namely consumers, competitors or even suppliers, or even of the exposure given to the sign, for example, through advertising or on the internet (24/03/2009, T‑318/06 – T‑321/06, General Optica, EU:T:2009:77, § 36-37 and 30/09/2010, T‑534/08, Granuflex, EU:T:2010:417, § 19).

In an application for invalidity based on Article 60(1)(c) EUTMR in conjunction with Article 8(4) EUTMR, the invalidity applicant must show the earlier sign’s use in the course of trade of more than local significance by the filing date of the contested EUTM (or the priority date, if relevant). In invalidity proceedings, the applicant also has to prove that the sign was used in the course of trade of more than local significance at another point in time, namely at the time of filing of the invalidity request. This condition derives from the wording of Article 60(1)(c) EUTMR, which states that an EUTM will be declared invalid ‘where there is an earlier right as referred to in Article 8(4) and the conditions set out in that paragraph are fulfilled’ (03/08/2011, R 1822/2010‑2, BABY BAMBOLINA (fig.), § 15). The requirement of the ‘continued existence’ in the context of Article 8(4) EUTMR in invalidity proceedings is now explicitly set out in Article 16(1)(b) EUTMDR in conjunction with Article 7(2)(d) EUTMDR.

 

The above was confirmed by the General Court in its ruling in the Baby Bambolina case (23/10/2013, T‑581/11, Baby Bambolina, EU:T:2013:553). The Court held that the earlier right relied on in support of an opposition must still exist at the time when the notice of opposition is filed. By analogy, the earlier right relied on in support of an application for a declaration of invalidity must still exist at the time that the application is filed. This normally presupposes that the sign in question must still be in use at the time of the filing of the notice of opposition or of the application for a declaration of invalidity. Indeed, it is precisely the use of the sign in the course of trade which is the basis of the existence of the rights to that sign (23/10/2013, T‑581/11, Baby Bambolina, EU:T:2013:553, § 26 and 27).

The contested trade mark was filed on 24/04/2019. Therefore, the applicants were required to prove that the signs on which the application is based were used in the course of trade of more than local significance in Greece, Croatia, Hungary, the Netherlands, Romania and Slovenia prior to that date. Furthermore, the invalidity request was filed on 08/10/2020. The evidence must also show that the applicants’ signs were still used at that time, and that they have been used in the course of trade for the goods or services claimed by the applicants, namely production and supply of management systems (software) with solutions and services encompassing the spectrum of the automotive industry; production and supply of additional, related software such as customer relationship management software; installation and maintenance of the above-mentioned types of software; providing of customer support with regards to the above-mentioned types of software.

 

The applicants filed the following evidence to demonstrate the use of the earlier signs:

 

 Annex 1: extracts from Dutch Chamber of Commerce regarding both applicants showing the date of establishment of the companies in 2001 and 2006, respectively.

 Annex 2A and B: invoices, all of them issued by either one of the applicants, dated mostly in 2007 and 2008. The remaining ones are dated on 02/10/2018, 01/02/2019, 31/10/2019 and four invoices dated in 2020, all of these are addressed to the same company seated in the United Kingdom and they are for ‘general service and support fees’ and for ‘sale and installation of XL products’, which, when compared to the presentation and brochure, appear to be software products for car rental companies. All the invoices contain the logo at the top.

 Annex 2C: undated PowerPoint presentation containing information about the business activity carried out under the name CarPro Systems, which appears throughout the presentation in the following form: . The business activity is described as providing software system solutions for optimizing business processes of car rental companies. The presentation describes the software in detail and promotes its benefits for the clients.

 Annex 2D: design descriptions - what appears to be several proposals for updates/ improvements of the applicants’ software products. The dates of creation/last update are in 2006.

 Annex 2E: an undated brochure containing summarized information from the presentation submitted in Annex 2C.

 Annex 3: printouts of the applicants’ website www.carprosystems.com, undated except for the date of printing, 21/01/2020 and 07/04/2020.

As explained above, the applicants have to demonstrate that the trade names on which they rely were in use, in the course of trade of more than mere local significance, both at the time of filing of the contested mark (24/04/2019) and at the time of filing of the invalidity request (08/10/2020). Most of the evidence is dated up to 2008 or refers to events that occurred up to that year. This is more than ten years before the filing of the contested mark and such time period is too long for any possible extrapolations to the year 2019. The documents evidencing use of the signs closer to the relevant dates are invoices dated from October 2018 to 2020. The time lapse between the evidence of 2006 to 2008 and the first invoice of 2018 is too large to enable the Cancellation Division to draw a conclusion that the use continued between those dates. The only documents that show use of the applicants’ signs before the filing of the contested mark and at the same time in a time period reasonably close to that date are two invoices dated on 02/10/2018 and on 01/02/2019. Both these invoices are addressed to the same company in the United Kingdom and are both for ‘general service and support fees’ and for ‘initial sale and installation of XL products’. Although these invoices are not for negligible amounts (each of them involves GBP 13 967,50), they are not sufficient proof that the invoked trade names were used in the course of trade in more than mere local significance. The geographical spread of the provision of the services is extremely limited, both instances of sales being to the same entity in a small town, moreover outside of the European Union. The only EU connection is the fact that the services were provided by a Dutch company. This use is also not long-term, regular, frequent or significant in any other way regarding the aspect of time. Admittedly, the trade names were in use in 2006 to 2008, as mentioned above, which would constitute a long-term use if connected to the more recent one. However, the absence of any evidence documenting any use whatsoever of the trade names between 2008 and 2018 shows an interruption of use for ten years, a period too extended for this to be considered continuous use over a long period of time. Moreover, the intensity of the earlier use was not such that the trade names could retain certain significance on the market even in their absence of ten years. Therefore, the use to be taken into account shows only two sales shortly before the filing date of the contested mark, to one company, not supported by any promotional efforts or other commercial activities. The applicants claim that the signs were promoted in the presentations and brochures given to clients, as well as on the website, but the presentation and brochure submitted do not contain any reference to the relevant time before the filing date of the contested mark and it is also not clear to which clients, if any, when, where and how intensively they were distributed or presented. As regards the website, the only reference to the period before the filing of the contested mark are three small posts in the ‘news’ section inserted in December 2018 referring to CarPro Systems being validated, certified or compliant with certain bodies or norms. The events specified in the posts refer to internal processes of a company such as getting an ISO certification or being compliant with GDPR and do not constitute use of the signs in the course of trade in relation to the relevant public. Even if it could be considered that the information about these events included on the website is a kind of promotion of the trade names, there is no indication of the outreach of these small posts on the applicants’ website and this cannot alter the conclusion of the minimal scope of the overall use. In summary, although the amounts charged in the two invoices are not negligible, as mentioned above, and also considering the posts on the applicants’ website, this use is not of such significance as to compensate for the lack of geographical spread and time intensity of the use.

Considering all the above, it is concluded that the applicants did not demonstrate that the invoked trade names were used in the course of trade in a more than mere local significance before the filing date of the contested mark. Since one of the requirements of Article 8(4) EUTMR is not fulfilled, the application has to be rejected insofar as it is based on Article 60(1)(c) EUTMR in conjunction with Article 8(4) EUTMR.

 

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 applicants are the losing party, they 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

Oana-Alina STURZA

Michaela SIMANDLOVA

Judit NÉMETH

 

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.