Trademark: Likelihood of confusion & Independent distinctive role

Published onApril 2013

Does a composite marks consisting of a company name and a third party’s registered trademark automatically infringe this earlier right even when the reproduced element is not dominant?

Community and French courts tend to answer affirmatively when:

  • The reproduced trademark has normal distinctiveness;
  • The reproduced trademark keeps an independent distinctive role within the composite sign, meaning that (i) the addition of the company name does not give to the common element another meaning and (ii) the consumer of the goods or services at stake perceives said common element as distinctive per se.

This interpretation has been held by the Court of Justice of the European Union (CJEU) in a case opposing MEDION’s trademark LIFE to trademark application THOMSON LIFE for leisure electronic devices (1). The Court ruled that:

The global appreciation of the likelihood of confusion, in relation to the visual, aural or conceptual similarity of the marks in question, must be based on the overall impression given by the marks, bearing in mind, in particular, their distinctive and dominant components. The perception of the marks by the average consumer of the goods or services in question plays a decisive role in the global appreciation of that likelihood of confusion[…]”.

In the context of consideration of the likelihood of confusion, assessment of the similarity between two marks means more than taking just one component of a composite trade mark and comparing it with another mark. On the contrary, the comparison must be made by examining each of the marks in question as a whole, which does not mean that the overall impression conveyed to the relevant public by a composite trade mark may not, in certain circumstances, be dominated by one or more of its components.

However, beyond the usual case where the average consumer perceives a mark as a whole, and notwithstanding that the overall impression may be dominated by one or more components of a composite mark, it is quite possible that in a particular case an earlier mark used by a third party in a composite sign including the name of the company of the third party still has an independent distinctive role in the composite sign, without necessarily constituting the dominant element.

It must therefore be accepted that, in order to establish the likelihood of confusion, it suffices that, because the earlier mark still has an independent distinctive role, the origin of the goods or services covered by the composite sign is attributed by the public also to the owner of that mark.

In this particular case, LIFE shall be considered as the product brand while THOMSON shall be perceived as the builder brand. Therefore, THOMSON LIFE infringes LIFE even if LIFE is obviously not the most distinctive and dominant element of the composite trademark.

This case sets an exception to the principle that the marks must be compared as a whole, taking into account their distinctive and dominant components, and opened a kind of Pandora’s box. The owner of trademarks being reproduced in composed signs immediately saw an opportunity to assert their rights, even in very different circumstances.

The French courts sparingly apply this exception, trying to avoid falling into the trap of old interpretations such as the notion of “reproduction with ineffective addition”, abandoned since 2002, to comply with the standards of overall assessment of the likelihood of confusion between the marks.

Two recent examples nevertheless provide interesting insights, particularly with regard to the degree of distinctiveness of the reproduced element (LONCAR Sunless v/ Sunless), and the perception of the public (e.on v/ HYUNDAI EON).

Recently, the Court of Appeals of Paris (2) considered that there was a risk of confusion between registered trademark e.on and French trademark application HYUNDAI EON, expressly referring to the criterion of independent distinctive role in the following terms:

The distinctive and dominant element of the dominant Hyundai […] is not such as to exclude the likelihood of association resulting from the juxtaposition of HYUNDAI and the earlier mark e.on which has a normal distinctiveness and which keeps within the contested sign HYUNDAI EON an independent distinctive position“.

This case was about motor vehicles. The Court held that the relevant public, which is used to associate product names to corporate brands, would identify both as such in the sign HYUNDAI EON and perceive the element EON as distinctive, despite the dominant character of HYUNDAI due to its reputation and its position within the first mark. The addition of HYUNDAI was therefore not sufficient to avoid the risk of confusion between signs e.on and EON.

Another interesting decision was issued by the European General Court (EGC): LONCAR company, owner of Community trade mark LONCAR-sunless, filed an opposition against Community trade mark application sunless for awnings, blinds, curtains and blinds. The opposition was upheld by the Opposition Division and the Board of Appeal of the Community Trademark Office and the applicant appealed before the Court of First Instance (3).

Judges consider that the word ‘sunless’ occupies in both trademarks an independent distinctive position and that it constitutes for consumers, the main reference point while comparing them […]. There is a high risk of confusion between the marks.

The argument relative to the descriptive nature of “Sunless” applied to curtains and blinds, whose very function is to let less sun enter in a room, was discarded by the court, which considers that the element LESS would not be understood by non-English speakers. Given the unitary character of the Community trade mark, the risk of confusion even for a part of the relevant public is enough to reject the application for trademark registration.

It can be noticed that applying for a mark with a very evocative verbal element may place the applicant in an awkward situation in case of litigation. He would have to face a dilemma: either to invoke the descriptive nature of the word element which may cause the reopening of the examination of the trademark application and the refusal of the mark for lack of distinctiveness or to state the distinctiveness of the common element which could lead to implicitly accept the infringement of the earlier trademark (4).

One comment on this decision: the court holds that since “the earlier mark is verbal, it is likely to be used by its owner in different graphical representations […]. Nothing prevents the owner from using it with the same font that the trademark application.” This categorical argument is in our opinion very questionable since trademarks should be compared as they were filed or registered.

In conclusion, to assess if a sign composed by the company name of the applicant and a registered mark infringes the reproduced trademark the comparison must be made between the marks as a whole, not just the mutual elements of the marks, and by taking into account the distinctive and dominant elements of each sign. However, as an exception to this principle, where an earlier mark has an independent distinctive role within a composite mark that also includes a third party’s name, the infringement could be recognized, even where the earlier mark is not the dominant element.

According to this case law, adding one’s trade name to a product’s brand, even a very evocative one, is not a guaranty not to infringe prior rights. Availability searches should be made, at least among identical trademarks, in order to take into account the different principles set out by Laws and Courts and all factors relevant to the circumstances of the case.

*

(1) CJEU, 6 Oct. 2005, Medion AG v. Thomson multimedia Sales Germany & Austria GmbH, Case C-120/04).

(2) Court of Appeals of Paris, 21 Dec. 2012 E.ON Ag (Germany) v. INPI and HYUNDAI MOTOR COMPANY (South Korea).

(3) CFI, 29 Jan. 2013, Thomas Müller v. OHMI and Loncar, SL, Case T‑662/11.

(4) CFI, 18 Oct. 2007,  Ekabe International SCA v. OHIM and Ebro Puleva, PULEVA OMEGA 3 and OMEGA 3 + logo, Case T‑28/05.

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