CANCELLATION No 16 002 C (REVOCATION)
Lagora (Société à responsabilité limitée), 28-32, Place de la Gare, 1616 Luxembourg, Luxembourg (applicant), represented by Office Freylinger S.A., 234, route d’Arlon B.P. 48, 8001 Strassen, Luxembourg (professional representative)
a g a i n s t
‘Aroma’ AD, 10 ‘Kiril Blagoev’, 1271 Sofia, Bulgaria (EUTM proprietor), represented by Angelina Spasova, 10 ‘Kiril Blagoev’, 1271 Sofia, Bulgaria (employee representative).
1. The application for revocation is upheld.
2. The EUTM proprietor’s rights in respect of European Union trade mark No 9 733 114 are revoked in their entirety as from 15/09/2017.
3. The EUTM proprietor bears the costs, fixed at EUR 1 080.
The applicant filed a request for revocation of European Union trade mark registration No 9 733 114 ‘LABORA’ (word mark) (the EUTM). The request is directed against all goods covered by the EUTM namely:
Class 3: Bleaching, preparations and other substances for laundry use; Cleaning, polishing, scouring and abrasive preparations; (abrasive preparations) soaps; Perfume, essential oils, cosmetics, hair lotions; Preparations for cleaning teeth.
The applicant invoked Article 58(1)(a) EUTMR.
SUMMARY OF THE PARTIES’ ARGUMENTS
The applicant argued that the EUTM should be revoked in its entirety because it has not been genuinely used for a continuous period of five years in relation to the goods for which it is registered.
The EUTM proprietor submitted proof of use in reply, the complete list of which is given below. It mentions that the application for revocation has been initiated in reaction to its own opposition based on this EUTM against an international registration designating the European Union, whose holder is the applicant.
The applicant criticised the evidence submitted, especially the insufficient extent of use in terms of commercial volume and geographical extent. It also indicated that the evidence reflects internal use rather than public and outward use and that the territory of use cannot be safely inferred. It put forward that the companies mentioned in the evidence bear no links to the EUTM proprietor and that the EUTM proprietor has not submitted explicit consent for the use of its trade mark by those companies.
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 17/11/2011. The revocation request was filed on 15/09/2017. 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, 15/09/2012 to 14/09/2017 inclusive, for the contested goods listed in the section ‘Reasons’ above.
On 22/12/2017 the EUTM proprietor submitted the following evidence as proof of use. The evidence bears a blue stamp with the name of the EUTM proprietor that was likely affixed to the documents manually.
Evidence No 1: Presentation, of unknown origin and undated, with the indication on the cover page. The goods presented are all skin‑care cosmetics (anti-wrinkle masks, micellar water, hydrating and firming serum, cleansing gels, etc.). ‘LABORA’ is the house mark, whereas the specific lines are called ‘Active Pure’, ‘Hydro2’, ‘Hyaluronic3 Expert’, ‘New Botox’ and ‘Ageless’. The document highlights the qualities of the goods (high performance care, exclusive formulations, fast results, etc).
It includes photographs of packaging as follows:
The document refers to positioning in the premium segment and mentions different channels of distribution (boutiques, luxury spas, hotels and department stores, beauty salons, dermatologists’ offices, pharmacies, inflight sales, etc).
Evidence No 2: Certificates of analysis for samples of LABORA Micellar water and of LABORA Enzymatic AH Glycol Peel, issued by the EUTM proprietor, dated 14/06/2016 and 23/06/2014.
Evidence No 3: Invoice in Bulgarian, with its English translation, issued by SUPERNOVABRAND Ltd for the attention of AROMA COSMETICS AD, for ‘creating packaging labels for goods under the TM LABORA’, dated 24/06/2014 for an amount of BGN 12 000. In its observations, the EUTM proprietor indicates that AROMA COSMETICS is the main distributor of AROMA for Bulgaria.
Evidence No 4: Contract (bilingual English and Bulgarian), indicating the date of 07/03/2016, between ‘AROMA’ PLC (the ‘seller’) and ‘AROMA COSMETICS’ JSC (the ‘purchaser’). The parties have the same address, and the same representative for the signature, who is identified as the CEO of both. Annex No 1 of the contract includes a list of ‘LABORA’ products and their prices. The products are all cosmetics for skin care (micellar water, cleansing milk, Enzymatic and AHA peel, facial scrubs such as toners for oily skin, rebalancing emulsion, hydrating serum, anti-wrinkle masks, etc.).
Evidence No 5: Four invoices, in Bulgarian with an English translation, issued by AROMA PLC (corresponding to the translation of АРОМА АД). The recipient is the same in all Bulgarian originals (АРОМА КОЗМЕТИКС АД) but is not always translated or the translation varies. When they are indicated, the addresses of both companies are the same:
Invoice dated 12/12/2017, for various products identified as ‘LABORA’ in the Bulgarian and English versions. The descriptions seem to refer to the ranges mentioned in the presentation and in the price list, namely, ‘HYDRO’, ‘ACT. PURE’ and ‘HYALURONIC’. Some include indications such as ‘hydrating’, ‘tonic’, ‘beautifying body nectar’, ‘hand moistur.’ and ‘luxurious energy cream’, which clearly refer to skin‑care products. The total amount is BGN 1 118.76, which corresponds to 97 items.
Invoice dated 02/11/2017 for products referred to as ‘LABORA BASIC’. The total amount of BGN 328.70 corresponds to 30 items.
Invoice dated 23/11/2016 for ‘LABORA’ and ‘LEXIRA LABORA’ products. The total amount of BGN 186.96 corresponds to 11 items.
Invoice dated 26/07/2016, for an amount of BGN 54.60 corresponding to 14 items. However, the translation in English seems to identify the products in question as ‘LABORA’ in error since, in the Bulgarian original, ‘LABORA’ is not mentioned and the trade mark appears to be ‘LEXIRA’.
Evidence No 6: Folding packaging for the ‘LABORA’ Micellar Water and for the ‘LABORA’ Enzymatic and AHA/glycol peel, for goods sold on the Bulgarian market (which the EUTM proprietor claims is evidenced by the Bulgarian barcodes).
Evidence No 7: Folding packaging for those same goods sold on the UK market (which the EUTM proprietor claims is evidenced by the UK barcodes).
The applicant contested the evidence of use filed by the EUTM proprietor on the grounds that it does not originate from the EUTM proprietor itself but from another company.
According to Article 18(2) EUTMR, use of the European Union trade mark with the consent of the proprietor is deemed to constitute use by the proprietor.
The fact that the EUTM proprietor submitted evidence of use of its marks by a third party implicitly shows that it consented to this use (08/07/2004, T‑203/02, Vitafruit, EU:T:2004:225).
Consequently, since it can be presumed that the evidence filed by the EUTM proprietor is an implicit indication that the use was with its consent, the applicant’s claim is unfounded.
Assessment of genuine use – factors
The indications and evidence required in order to provide proof of use must concern the place, time, extent and nature of use of the EUTM proprietor’s trade mark for the relevant goods and 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 proprietor is obliged not only to indicate but also to prove each of these requirements.
‘…genuine use of a trade mark cannot be proven by means of probabilities or suppositions, but must be demonstrated by solid and objective evidence of effective and sufficient use of the trade mark on the market concerned’ (18/01/2011, T‑382/08, Vogue, EU:T:2011:9, § 22).
It is relevant that genuine use implies real use of the mark on the market concerned for the purpose of identifying goods or services. Genuine use is therefore to be regarded as excluding minimal or insufficient use for the purpose of determining that a mark is being put to real, effective use on a given market.
Public use in the course of trade
The use must be public; that is to say it must be external and apparent to actual or potential customers of the goods or services. Use in the private sphere or purely internal use within a company or a group of companies does not amount to genuine use (judgments of 09/12/2008, C‑442/07, Radetzky, EU:C:2008:696, § 22; 11/03/2003, C‑40/01, Minimax, EU:C:2003:145, § 37; 09/09/2015, T‑584/14, ZARA, EU:T:2015:604, § 33).
In this case, as the applicant has contended, the evidence does not show public and outward use.
The Court has established that use of the mark of a production company by a distribution company cannot be regarded as purely internal use when the evidence also contains evidence of outward and public use (17/02/2011, T‑324/09, Friboi, EU:T:2011:47, § 32).
However, this is not the case here. The sales take place between the EUTM proprietor AROMA and AROMA COSMETICS, which the EUTM proprietor describes as the distributor of the former for Bulgaria. The seller and the buyer mentioned in the invoices and in the contract clearly belong to the same group of companies, as they have the same address and, as can be read in the contract, the same representative for the signature and the same CEO. The use reflected by those sales is internal use within a group of companies, and the evidence does not include catalogues, promotional materials, or any other items (such as photographs in shops or presence in online sales websites) showing that ‘LABORA’-branded goods were made available to end consumers. The invoice regarding packaging and the certificates of analysis do not indicate use on the market. No information is given regarding the purpose or the recipients of the presentation.
Therefore, the evidence fails to prove public and outward use in the context of commercial activity with a view to economic advantage for the purpose of ensuring an outlet for the goods (12/03/2003, T‑174/01, Silk Cocoon, EU:T:2003:68, § 39; 30/04/2008, T‑131/06, Sonia Sonia Rykiel, EU:T:2008:135, § 38).
Although the above suffices to conclude that the EUTM proprietor has failed to prove genuine use of the EUTM, the Cancellation Division notes, for the sake of completeness, that the extent of use is also not satisfactorily proven.
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).
In the present case, the information regarding the extent of use can essentially be gathered from the invoices.
The two invoices dated within the relevant period (26/07/2016 and 23/11/2016) show sales of 25 products for approximately BGN 240, which is around EUR 120. This takes into account the 14 products identified as ‘LEXIRA’ in the invoice in Bulgarian, contrary to what is mentioned in the translation. The amount of sales and the quantity of products are extremely low, and the sales take place over a period of less than four months.
The EUTM proprietor has submitted another two invoices, dated just after the relevant period. Evidence referring to use outside the relevant period is disregarded unless it contains conclusive indirect proof that the mark must have been genuinely used during the relevant period as well. Events subsequent to the relevant period may make it possible to confirm or assess more accurately the extent to which the earlier mark was used during the relevant period and the EUTM proprietor’s real intentions at the time (27/01/2004, C‑259/02, Laboratoire de la mer, EU:C:2004:50).
In the present case, the two invoices dated after the relevant period merely indicate continuity of sales but do not cast any light on the possible reasons why the use during the relevant period was so limited, and do not suggest that this use was of more significance than the invoices reflect. Furthermore, although the sales shown are higher (127 more items, for approximately BGN 1 450 or around EUR 725), they are still very low in total considering the nature of the goods at issue, their relatively low price as shown in the invoices and the variety of channels of distributions mentioned by the EUTM proprietor in the observations and indicated in the internal presentation.
As emphasised by the applicant, the low commercial volume is not offset by a broad geographical extent of use as the invoices only refer to sales between two companies in Bulgaria. The EUTM proprietor’s references to sales in the UK are not supported by objective and reliable evidence.
Furthermore, the invoices are not supported by any other document from which it may be inferred that the EUTM proprietor has seriously tried to create or preserve an outlet for the ‘LABORA’-branded cosmetics on the market. The invoice issued by a EUTM proprietor’s supplier for ‘creating packaging labels for goods under the TM LABORA’ is for quite a high amount (approximately EUR 6 000) but it is not specific enough as it does not mention quantities. It is not clear whether it refers to the actual production of labels or merely to the activity of designing labels. In any case, even if this invoice dated June 2014 were for ‘many’ labels, the evidence does not show any sales of ‘LABORA’ products over the next two years and the sales shown are of only 25 (or 11) ‘LABORA’ products in the four months before the end of the relevant period.
On the basis of the above, it is clear that the evidence does not indicate that the EUTM proprietor has taken any measures to create or preserve an outlet for the goods on the market, nor does it include any catalogues or promotional materials featuring the goods, or proof that the goods have been on sale in shops or online.
Therefore, extent of use is not satisfactorily proven.
In order to examine, in a given case, whether use of the earlier 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).
The evidence relates only to skin-care cosmetics. The EUTM proprietor has clearly failed to prove genuine use of the EUTM for those goods because the evidence refers to internal use only, which does not qualify as genuine use, and because the extent of the use is in any case too low. Genuine use is not proven for the remaining goods covered by the EUTM to the extent that the evidence does not make any reference to them.
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).
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 15/09/2017.
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
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.