CANCELLATION No 15 783 C (REVOCATION)
Oenoforos AB, P.O. Box 24005, 104 50 Stockholm, Sweden (applicant), represented by Brann AB, Drottninggatan 27, 111 51 Stockholm, Sweden (professional representative)
a g a i n s t
Bodegas Artevino, S.L., C/ Herrería Travesia, 2-5, 01307 Villabuena (Alava), Spain (EUTM proprietor), represented by Arochi & Lindner, S.L., C/ Serrano 28, 1°C, 28001 Madrid, Spain (professional representative).
1. The application for revocation is upheld.
2. The EUTM proprietor’s rights in respect of European Union trade mark No 10 182 401 are revoked in their entirety as from 06/09/2017.
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 10 182 401 ‘CHOCOLATE’ (word mark) (the EUTM). The request is directed against all the goods covered by the EUTM, namely:
Class 33: Wines.
The applicant invoked Article 58(1)(a) EUTMR.
SUMMARY OF THE PARTIES’ ARGUMENTS
The applicant argues that the EUTM has not been put to genuine use for a continuous period of five years and therefore, must be revoked in its entirety.
The EUTM proprietor, in its response, submits evidence to prove the use of the EUTM which will be listed in detail below in the following section of the present decision. The EUTM proprietor claims that this evidence is sufficient to show the place, time, nature and extent of use and that therefore, the application must be rejected.
The applicant, in its reply, contests the evidence of use. In particular, it claims that the amounts sold in the invoices are very low considering that the wine is not expensive and the EUTM proprietor is located in Spain which has a very large population. Therefore, it claims that the extent of use is insufficient and the EUTM must be revoked.
The EUTM proprietor, in its rejoinder, insists that the evidence is sufficient to prove the extent of use and that it is not required to submit all invoices but just examples and that it must only show genuine use which is not token use. Therefore, it claims that the evidence is sufficient to prove the use of the EUTM and the application must be rejected. The EUTM proprietor cites numerous decisions of the European Courts and the Board of Appeal to highlight that there is no minimum threshold and that even a relatively small amount of use may be sufficient and not just token. Therefore, it argues that the evidence it has submitted is sufficient to prove the extent of use.
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 26/12/2011. The revocation request was filed on 06/09/2017. 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, from 06/09/2012 to 05/09/2017 inclusive, for the contested goods:
Class 33: Wines.
On 05/12/2017 the EUTM proprietor submitted evidence as proof of use.
The evidence to be taken into account is the following:
Attachment I: Invoices for the sale of different types of wines, including CHOCOLATE wine with 7 of the invoices dated between 06/06/2016-16/06/2017 and one dated 23/10/2017. The corresponding amount billed for CHOCOLATE wine in each invoice ranges from EUR 84-EUR 1,128 for a total of EUR 4,145.04 in the relevant period and for the last invoice dated 23/10/2017 for EUR 225.60.
Attachment II: Invoice billed to the EUTM proprietor for the creation of the packaging of CHOCOLATE wine dated 29/03/2016 with a translation into English of same.
Attachment III: Image of the bottle of wine with the sign CHOCOLATE.
Attachment IV: Copy of the EUTM proprietor’s magazine ‘Arte Vino’ issue No. 13 of December 2016 where there is a reference to, and description of the wine and a photograph of same and a partial translation into English.
Attachment V: An example of a wine label bearing the sign CHOCOLATE.
Assessment of genuine use – factors
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 Court has held that ‘[u]se of the mark need not … always be quantitatively significant for it to be deemed genuine, as that depends on the characteristics of the goods or service concerned on the corresponding market’ (11/03/2003, C‑40/01, Minimax, EU:C:2003:145, § 39).
It is not possible to determine a priori, and in the abstract, what quantitative threshold should be chosen in order to determine whether use is genuine or not. A de minimis rule cannot therefore be laid down. When it serves a real commercial purpose, even minimal use of the mark can be sufficient to establish genuine use (27/01/2004, C‑259/02, Laboratoire de la mer, EU:C:2004:50, § 25, 27).
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.
The evidence submitted by the EUTM proprietor in order to prove genuine use of the earlier EUTM relates exclusively to Spain. As stated above, the territorial scope of the use is only one of several factors to be assessed in the determination of whether the use is genuine or not.
The smaller the commercial volume of the exploitation of the mark, the more necessary it is for the EUTM proprietor to submit additional evidence to dispel possible doubts as to its genuineness (08/07/2004, T‑334/01, Hipoviton, EU:T:2004:223, § 37).
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).
In the present case the goods at issue are wines and Spain is a very large territory. Therefore, the sale of a relatively cheap bottle of wine for total sales of only EUR 4,145.04 during the relevant period (with an additional EU 225.60 billed after the relevant period) is an insignificant amount of sales in the large territory of Spain. Moreover, these sales are concentrated in only one year at the end of the relevant period.
The EUTM proprietor relies on the judgment of 16/11/2011, T 308/06, Buffalo Milke, EU:T:2011:675 in which 9 invoices dated between April 2001 and March 2002 representing sales of around EUR 1,600 (with a turnover barely above EUR 1,000,000 per year) showing that the items were delivered to different customers in small quantities for widely used products like shoe polish in the largest European market, Germany, with approximately 80 million potential customers, was deemed sufficient to create or preserve an outlet for polishing cream and leather conditioner. It also relies on the judgment of 27/09/2007, T 418/03, La Mer, EU:T:2007:299 in which 10 invoices billed over 33 months regarding several product ranges sold to different customers were deemed sufficient. Therefore, it argues that the evidence it has submitted is sufficient to prove the extent of use.
However, the Cancellation Division must distinguish the present case from the judgments relied on by the EUTM proprietor. In the present case the EUTM proprietor has not submitted any overall turnover figures for the mark like in the Buffalo Milke case cited above. Moreover, there is no indication that the invoices submitted are only examples of sales and not the entirety of the sales. As the EUTM proprietor is clearly also selling other brands of wine, which is shown in the invoices, the other invoices could refer to sales of goods branded under different signs. Furthermore, the judgments above relate to different types of goods from the present case. Spain is one of the largest producers of wine and the wine market in Spain alone is very significant. Therefore, the sales shown are only for token amounts considering the market. Moreover, minimal sales in only one territory of the EU are not sufficient to prove the extent of use of the EUTM.
In this respect, the decision of the Board of Appeal of 20/05/2011 in R 2132/2010-2 ‘SUSURRO (figurative mark) / SUSURRO’ held that nine invoices concerning the sale of wine in 2005, 2006, 2007 and 2008 showing that over a period of 36 months goods marketed under the earlier mark and worth EUR 4 286.36 were sold, as well as an undated sample of a product label were not considered as sufficient proof of genuine use of a Spanish trade mark registered for alcoholic drinks (except beers) in Class 33 for a country with over 40 million inhabitants, the amount sold of a relatively cheap wine was found to be too small to create or preserve an outlet for goods (wine) that are consumed in large quantities by the average Spanish consumer.
This reasoning also applies in the present case, as the sales are confined to only one year of the relevant period, in only one territory of the EU and the sales made were very minimal (approximately EUR 4000). Therefore, considering the territory, the market, the goods at issue and the amount of sales made, the Cancellation Division considers that the EUTM proprietor has failed to prove the extent of use of the contested EUTM.
The Court’s unwillingness to entertain any notion of a de minimis rule means, at least in a literal sense, that the territorial borders of the Member States should be disregarded when considering evidence of use of an EUTM. Given the unitary nature of a EUTM, the Court no doubt felt that there was little choice but to evaluate evidence of use in relation to the ‘internal market’, rather than by dividing the market up into national territories. Also, given the huge disparity in the size of the respective national markets within the E.U., it would make little sense to try and formulate a requirement of use based on national boundaries.
That said, the Court has clearly acknowledged the dilemma of proof of use only covering a relatively small part of the overall EU territory. The issue may be stated with concision: can a trade mark registration which confers protection across the whole of the E.U. be maintained by a small amount of use in one geographical area?
All of the invoices in this case are for addresses in Spain. Taken together with weaknesses in the evidence, such as the lack of sales or turnover figures, and the paltry amount of just over 4,000 euros covered by the invoices, the Cancellation Division considers that the request to provide genuine use of the mark has not been met. The EUTM proprietor’s case has been built largely on the invoice evidence. The invoices were vital to show actual sales and some sort of presence in a market. There appears to be a presence, but not one which casts a sufficiently large geographical or commercial shadow such as to justify the preservation of an EUTM registration. The factors of use are cumulative, and therefore, as the EUTM proprietor has failed to prove the extent of use the Cancellation Division does not have to examine the remaining factors of use, as such an examination will not affect the outcome of the present decision.
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).
In the present case, the Cancellation Division considers that genuine use of the contested mark not been sufficiently demonstrated for the relevant factor of extent of use. Therefore, the EUTM proprietor has failed to prove the use of the EUTM.
It follows from the above that the EUTM proprietor has not proven genuine use of the contested EUTM for any of the goods 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 06/09/2017.
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.