Borderline descriptive marks still enforceable

The background

Easy Asset Management AD (East Asset) filed an application for a declaration of invalidity in respect of an international registration for the following mark, which was registered by TeamBank AG Nürnberg (Teambank) in 2012.

The action was based on EasyCredit's earlier Bulgarian national registration.

The mark for mark comparison

The two sets of services related to finance and telecommunications and were identical. The dispute therefore focussed on the similarity (or otherwise) of the marks – put simply, was there any likelihood of confusion?

The European Union IP Office (EUIPO) Cancellation Division had initially rejected the application for a declaration of invalidity, finding that the marks coincided only in their respective word elements, which are manifestly descriptive of all activity linked to the world of finance, while their figurative elements, in which the distinctive character resides, were unrelated. The Board of Appeal upheld the appeal, finding that there was a likelihood of confusion due to the strong similarity of the signs. It found that neither of the signs were sufficiently stylised to change their overall visual impression.

Upon appeal to the GC, Teambank maintained that there was no likelihood of confusion – disputing the finding of the Board of Appeal by submitting that the word elements were descriptive and not distinctive and, therefore, must not be taken into consideration. They submitted that the signs should be compared on the basis of the figurative elements which were different ie, arguing that the initial EUIPO Cancellation Division decision was correct.

The court found that the marks coincided in their word elements, and the figurative elements were of lower importance due to their size, position and purely decorative shape. The court therefore rejected the argument that, due to a lack of distinctiveness, the word elements must be disregarded when comparing the signs. We know that it is only where all the other components of the mark are negligible that the assessment of the similarity may be carried out solely on the basis of the dominant element (as recognised in Nestlé v OHIM, C?193/06 P); however, given their respective size and position in the marks at issue, the court held that the word elements could not be regarded as negligible.

Interestingly the court did recognise that the word elements 'easy credit', were common to the signs at issue and would easily be understood by the relevant public with a command of English as an indication of the type of services in question. However, while the English term 'easy credit' may be of a descriptive nature for the Bulgarian public, the respective word elements were considered to occupy a central position in the signs at issue and dominate the overall picture. Accordingly the court found in favour of the Board of Appeal's earlier decision and concluded that there was a likelihood of confusion.

Questionable or logical outcome?

No doubt the Board of Appeal and GC were correct in finding that the registration of a national mark implies that the earlier mark has a minimum of inherent distinctiveness. After all, Article 3(1)(b) of Directive 2008/95/EC precludes registration of a mark which is devoid of distinctive character. However, the way in which the court has reached a finding that this minimal degree of distinctive character is in fact sufficient in this case is noteworthy.

The court appears to recognise on the one hand that the word element 'easy credit' will easily be understood by the relevant public as being descriptive of the services in question, yet it somewhat contradicts itself by finding that the identical word elements are sufficient to reach a finding of likelihood of confusion. The court appears to stress that the word elements are dominant and cannot therefore be considered negligible; but are they distinctive?

It is perhaps questionable whether, rather than assessing the dominance of the word elements, the court should have completely removed them from the equation having acknowledged that they were descriptive. Had it done so, there would have arguably been only one logical outcome – that the marks are in fact, based on the remaining figurative elements, dissimilar. Whether the case is further appealed remains to be seen.

Case details at a glance

Jurisdiction: European Union
Decision level: General Court
Parties: TeamBank AG Nürnberg, Easy Asset Management AD, EUIPO
Citation: T-745/14
Date: 20 July 2016
Full decision: http://dycip.com/t74514