If one posed to most EUIPO practitioners the question: ‘what do Champagne, sherry, chocolate, yoghurt and rice have in common?’ they may not have a clue. The answer is they have all been protected under the English law of extended passing off.
Using passing off as a way of opposing a later trade mark has had something of a chequered history during the time the UK has been part of the EUIPO system. The use of extended passing off brings with it a further dimension in that the owner of the goodwill is one of many, who claims that there has been some damage as a result of a misrepresentation.
However, the Indo European Foods decision has turned a corner on the understanding of this form of protection and reliance on it.
What are the practical implications of this case?
To the extent there remain any opposition proceedings brought in the EUIPO based on the law of extended passing off as applied in the UK (and likely in Ireland), the applicants will have an easier time of arguing how it is to be understood and applied.
Of more significance, however, is the statement made in paragraph 54, that when the EUIPO has to take account of the national law of a Member State, it must (of its own motion) obtain information about that national law in order to assess the applicability of the ground for refusal. In other words, the EUIPO should not simply rely on what the applicant for opposition puts forward by way of case law, but must carry out its own independent research to verify that what the applicant says applies in the particular case. This requirement means that for all of the remaining Member States, where a specific local law peculiar to a Member State is relied on, the EUIPO must independently verify the case law and understand how it is to be applied.
Finally, considerable time was devoted to the ‘what’s the point?’ argument. In essence, if the right relied on will no longer exist at the tribunal decision date, EU law considers further litigation devoid of purpose. In this case, the right did exist, and even though the case must return to a Board of Appeal, that hearing is part of the same proceedings pending a new decision by reference to the circumstances existing at the time the action was brought. This ‘defence’ will no doubt be raised in future cases brought before the EUIPO.
What was the background?
An Austrian vendor of rice-based goods, applied for a figurative mark, which included the word BASMATI. A UK company opposed on the basis of the extended law of passing off as applied in the UK, namely: there was an earlier, unregistered right in the word BASMATI; that mark identified a specific class of goods, namely, rice; the applicant was entitled to share in the goodwill in that mark; use of the mark BASMATI constituted a misrepresentation leading to deception; and as a result, the applicant would suffer damage.
The Opposition Division rejected the opposition in its entirety. It considered that the evidence submitted failed to establish use of more than mere local significance. Following an appeal, the Board of Appeal found that there was goodwill in the mark BASMATI in the UK, it related to a specific class of goods, and that the applicant was one of a class entitled to share in the goodwill. However, it did not consider the registration would amount to a misrepresentation and would not lead to a loss of direct sales for the applicant, since the goods were different (rice and not rice-based goods).
The applicant for opposition appealed.
What did the court decide?
As the litigation was not devoid of purpose, the General Court went on to review the Board of Appeal’s findings and decision and the parties’ arguments, focussing on misrepresentation and damage.
The Court considered a number of cases relating to passing off as applied in proceedings before the EUIPO (Paice v EUIPO – Blackmore (DEEP PURPLE) T-328/16 and Dentsply De Trey v EUIPO – IDS (AQUAPRINT) T-312/18 ), extended passing off (Tilda Riceland Pvt v OHIM – Siam Grains (BASmALI) T-304/09) and English decisions (Chocosuisse decision ( EWCA Civ 856) and importantly, Tattinger SA v ALLBEV Ltd  (the ‘Elderflower Chamagne’ decision).
Significant was the Court’s finding that deception could be as to origin or nature of the goods in that they were a product of a specific region, or have particular characteristics. Misrepresentation was use of a sign, which induces the belief the defendant’s goods possess such characteristics or qualities when they do not.
A key finding was that as the mark applied for covered a broad description of goods, an English Court considering the likely notional and fair use a proprietor would make of the mark, would consider such use encompasses goods made from any type of rice, but including BASMATI rice. Accordingly, using a mark including the word BASMATI would be a misrepresentation that such rice-based goods were made using BASMATI rice.
The Court concluded that damage was not confined only to lost sales but included damage to the goodwill by erosion of the distinctiveness of the mark (as held in the Tattinger case).
Accordingly, the Board of Appeal was wrong to conclude that there was no misrepresentation or damage, and the decision was annulled.
This article was first published by Lexis®PSL on 21 October 2021.
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