July 1, 2012
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EUROPEAN UNION: New Interpretation of Detriment Requirement
The decision of the General Court of the European Union in Environmental Manufacturing LLP v. OHIM (Case T-570/10 (GC May 22, 2012)), concerning a wolf’s head logo, places a new interpretation on the requirements to prove detriment to the distinctive character of a mark with a reputation. The criteria that the Court of Justice of the European Union set out in the INTEL decision (Intel Corp. v. CPM United Kingdom Ltd., Case C-252/07 (ECJ Nov. 28, 2008)) require a change in the economic behavior of the average consumer of the earlier mark as a consequence of the use of the later mark, which can be extremely difficult to establish by evidence.
In the present case, a less stringent test has been imposed, which requires weakening of the earlier mark’s ability to identify its goods or services as coming from the earlier rights holder. Environmental Manufacturing v. OHIM, para. 54. This can be shown by logical deduction from an analysis of the probabilities and by taking account of the normal practice in the relevant commercial sector and other circumstances of the case. (Id. para. 52.)
In reaching this conclusion, the General Court endorsed the statement in INTEL that detriment to the distinctive character of the earlier mark is caused when “that mark’s ability to identify the goods or services for which it is registered and used as coming from the proprietor of that mark is weakened, since use of the later mark leads to dispersion of the identity and hold upon the public mind of the earlier mark.” (Intel v. CPM, para. 29.) However, the court reinterpreted the next controversial statement in INTEL, that “It follows that proof that the use of the later mark is or would be detrimental to the distinctive character of the earlier mark requires evidence of a change in the economic behaviour of the average consumer of the goods or services for which the earlier mark was registered consequent on the use of the later mark, or a serious likelihood that such a change will occur in the future.” (Id. para. 77.) The General Court stated that no additional effect such as a change in economic behavior is required.
This reasoning the General Court justified on the basis of the words “It follows” in the statement in INTEL. The Court implied that these words indicated that the statement was subordinate to the preceding general principle and that a change in economic behavior was merely an example of detriment, not an additional requirement.
The rationale for the General Court’s decision is open to criticism, but the conclusion will be welcomed by all owners of trademarks that have a reputation. It will be interesting to see how this decision is followed in future cases.
Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.
© 2012 International Trademark Association