THE EUROPEAN COURT OF JUSTICE UPHOLDS THE DISTINCTIVENESS OF THE F1 MARK
BY PROFESSOR IAN BLACKSHAW
A saga, which began 8 years ago, regarding the Formula One word mark ‘F1’and whether it was distinctive or generic, ended with an affirmative judgement in the Court of Justice of the European Union (CJEU) rendered on 24 May, 2012 in Case T-10/09 Formula One Licensing BV v OHIM.
The background to this case and the intermediate proceedings are as follows:
On 13 April 2004 Racing-Live SAS filed an application for registration of a Community Trade Mark (CTM). The trade mark was subsequently transferred to Global Sports Media Ltd, and was applied for in respect of several goods and services ‘relating to the field of formula 1’ in classes 16, 38 and 41.
The figurative sign (the Global F1 Live Sign), the subject of the CTM application, is reproduced as follows:
The application was opposed by Formula One Licensing (Formula One) which claimed that the Global F1 Live Sign should be refused registration under Article 8(1)(b) and 8(5) of Regulation No 40/94 (now Regulation No 207/2009). The opposition was based on two of Formula One’s earlier marks, namely:
– the word mark “F1” in respect of which Formula One had registrations in Germany, the UK and international registrations in Denmark, Germany, Spain, France, Italy and Hungary; and
– the figurative Community trade mark (the F1 Logotype), reproduced as follows:
The F1 Logotype was registered in respect of goods and services in Classes 16, 38 and 41 covering, inter alia, the goods and services covered by the F1 Live application, as were the
international registrations for the F1 word mark. The German registration was in class 41 (providing sporting activities) and the UK registration was for goods and services in class 16 (including paper and printed matter) and class 38 (including telecommunication services and electronic transmission of data).
Formula One also claimed that all its marks had enhanced distinctiveness on account of their use over many years in relation to various goods and services.
The Opposition Division of OHIM (Office for the Harmonisation of the Internal Market) (Community Trademark Office) rejected the F1 Live application, relying on the earlier international registrations for the F1 word mark. It found that the Global F1 Live Sign was similar – to a medium degree – with the earlier mark; that the goods and services covered by the two marks were similar; and that there was a likelihood of confusion under Article 8(1)(b) of the CTM Regulation.
In an appeal to the First Board of Appeal (BoA), the BoA annulled the decision ruling that, despite the similarity between the goods and services, the marks in contention were not sufficiently similar and there was no likelihood of confusion. In reaching its decision the BoA held that the relevant public perceived the combination of ‘F’ with ‘1’ as the generic designation of a category of racing car and, by extension, of races involving such cars and, consequently, that the reputation of Formula One’s marks concerned only the figurative ‘F1’ element of the F1 Logotype. Similarly, regarding the Article 8(5) objection, the BoA found that few consumers attribute any distinctive character to the abbreviation ‘F1’ unless it is represented in the fanciful manner of the F1 Logotype. Since the BoA felt consumers regarded ‘F1’ as a generic term and that the Global F1 Live Sign would not remind the public of the F1 Logotype, the former would not tarnish the reputation of the latter.
In an appeal to the General Court of the European Union, the Court upheld the findings of the BoA and dismissed Formula One’s objections on the following grounds:
Article 8(1)(b) of the CTM Regulation
The Court noted that the comparison must be between the marks as a whole, even though certain components of compound marks may be more dominant than others.
In the case of Formula One’s earlier marks the Court agreed with the BoA that the relevant public would perceive the combination of the letter ‘F’ and the numeral ‘1’ as an abbreviation of ‘Formula One’ which is the commonly used designation of a category of motor sport. Further, it supported the BoA’s finding that, in fact, it was only the stylised ‘F1’ element of the F1 Logotype that was perceived by the public to be the opponent’s trade mark in relation to its commercial activities in the field of Formula One motor racing.
In reaching this conclusion the Court noted that over the previous decade Formula One had consistently and exclusively used the F1 Logotype when granting licenses and had ensured strict compliance by licensees. Consequently, the public had only been exposed to the F1 Logotype and had grown to associate this mark (and this mark only) with the opponent’s
activities in Formula One. It was supported in its conclusion by survey evidence which suggested that the sign ‘F1’ was commonly perceived as a generic abbreviation for Formula One motor sport by the relevant public.
Having reached these conclusions the appropriate test for the purposes of Article 8(1)(b) was between the Global F1 Live Sign and the F1 Logotype. The Court found that there
was little visual similarity between the relevant marks because of the presence of the word ‘LIVE’ in the Global F1 Live Sign. Also the type setting of the respective marks was different, and the particular style of the ‘F1’ element of the F1 Logotype was unique. There was some degree of conceptual similarity, although the addition of ‘LIVE’ made the Global F1 Live Sign “conceptually richer”, suggesting the reporting of an event in ‘real time’. Overall, the Court considered that the degree of similarity was weak and, consequently, there was no likelihood of confusion between the marks in contention.
Finally, the Court noted that the validity of Formula One’s earlier word marks for ‘F1’ could not be put into question in the context of the opposition proceedings. However, its ruling left
little doubt that it regarded these marks as generic in relation to the relevant goods and services and lacking distinctiveness.
Article 8(5) of the CTM Regulation
Formula One’s arguments Article 8(5) could only be made in respect of the F1 Logotype, since the Court agreed with the BoA that this was the only sign in respect of which Formula One had shown use and reputation. In order to succeed, Formula One needed to demonstrate that the marks in contention were identical or similar; that the F1 Logotype had reputation; and that there was a risk that the Global F1 Live Sign would take unfair advantage, or be detrimental to, the distinctive character or repute of the F1 Logotype.
The Court looked first at whether the respective marks were similar and, following its analysis of Article 8(1)(b), it concluded that they were not. The presence of the element ‘F1’ in the Global F1 Live Sign was not sufficient (in light of the Court’s decision that the public regarded this as a generic abbreviation) to offset the visual contrast between the respective marks, and there was no risk of an association between the two.
Formula One appealed against this ruling to the Court of Justice of the European Union (CJEU) asking the Court to set aside the judgment of the General Court.
In its Judgment handed down on 24 May, 2012, the CJEU noted, first, that that the Community trademark does not replace the national trademarks of Member States and that the two types of trademark co-exist in the economic life of the European Union. The Court stated that, in this dual system of trademarks, the registration of national trademarks is solely a matter for the Member States and that, therefore, OHIM and the General Court are not competent to deal with either the registration or the declaration of invalidity of those trade marks.
Accordingly, the Court noted that the validity of a national trade mark may not be called into question in proceedings opposing the registration of a Community trade mark, but only in cancellation proceedings brought in the Member State in which the national trade mark was registered.
Also, according to the Court, it cannot be found, in such opposition proceedings, that a sign identical to a national trade mark is devoid of distinctive character; that is, the ability to allow the public to associate the products and services designated by the sign with the company which applied for its registration. Such a finding would be likely to eliminate the protection which national trade marks are intended to provide.
The Court, therefore, noted that, in a situation such as that of the present case, OHIM and, consequently, the General Court, must verify the way in which the relevant public perceives the sign which is identical to the national trade mark, solely in relation to the mark applied for, and evaluate, if necessary, the degree of distinctiveness of that sign. In that respect, the Court pointed out that it is necessary to acknowledge a certain degree of distinctiveness of a national mark on which an opposition against the registration of a Community trade mark is based.
In those circumstances, the Court found that, in finding that the sign ‘F1’, identical to the national trademarks of Formula One, was devoid of distinctive character, the General Court called into question the validity of those trade marks in proceedings for registration of a Community trade mark and, therefore, infringed the Regulation on the Community Trade Mark.
Accordingly, the CJEU set aside the judgment of the General Court and, since the CJEU was not in a position to give final judgment in the matter, referred the case back to the General Court for the appropriate ruling.
Comments on the Case
The ruling of the CJEU, in the opinion of the author of this article, is clearly correct in principle, especially as it respects the well-known concept of the territoriality of trademarks. It seems surprising, therefore, that F1 trademark registrations were not taken into account by the BoA and the General Court in deciding the Formula One opposition to the F1 Live CTM application, but were summarily dismissed by them. These are existing trademark registrations and, as such, are valid until successfully legally challenged in the appropriate proceedings.
Furthermore, as a result of the F1 trademark registrations, by definition, the F1 mark is regarded as being distinctive (the basic legal requirement for registering a trademark) and not descriptive or generic and must be respected as such. Also, the name ‘F1’ is the essential component of the trademarks in contention and clearly there is confusion between the two of them. Indeed, the word ‘Live’ does not add any distinctiveness to the applicant’s mark to prevent such confusion. Consumers would be confused and misled as to the source of the F1 Live mark.
As the CJEU noted in its Judgement, Community trademarks and national registered trademarks co-exist and are not, therefore, mutually exclusive or superior, the basis on which the BoA and General Court had proceeded to ignore the F1 national registrations.
Property rights – and trademarks are a species of property (intangible) recognised by the Law – can only be taken away by a proper legal procedure and not at the will of the BoA and the General Court, who have no power to do so under the provisions of the CTM Regulation.
Again, it seems that this general legal principle is axiomatic and it is a pity that Formula One has had to endure the time and expense of tortuous legal proceedings for the distinctiveness and validity of their F1 trademark to be finally recognised and upheld by the European Court of Justice. But that is how the Law tends to work and develop!
This ruling is not only of importance, of course, for Formula One, but also for the proprietors of other so-called famous sports marks and the consequent need to recognise and protect them legally.
Professor Ian Blackshaw is an International Sports Lawyer and Fellow of the TMC Asser Instituut International Sports Law Centre and may be contacted by e-mail at ‘email@example.com’