According to European Trademark Law, third parties have the right to file an application for the invalidation of a registered European Union Trademark based on the absolute grounds for refusal under Article 7 of the European Trademark Regulation 207/2009. One of the most technical and not easily conceivable grounds of refusal is the one included in Article 7 (1) (g) according to which “trademarks which are of such a nature as to deceive the public, for instance as to the nature, quality or geographical origin of the goods or service” should not be registered and can be invalidated after a third party’s application.
According to EU settled case-law, the infringement of Article 7(1)(g) EUTMR, “presupposes the existence of actual deceit or a sufficiently serious risk that the consumer will be deceived” (04/03/1999, C-87/97, Cambozola, EU:C: 1999:115, §41), while even, “a mere theoretical possibility that the public may be mistaken does not itself fall within an objection pursuant to Article 7(1)(g) EUTMR” (decision of 17/04/2007, R 1102/2005-4, “SMARTSAUNA”, § 32). Thus, “only where the targeted consumer is made to believe that the goods and services possess certain characteristics, which they do not in fact possess, will he be deceived by the trade mark”. (24/09/2008, T-248/05, I.T.@Manpower, EU:T:2008:396, §65). When broad categories of goods are registered and use of the mark could be deceptive for only some of the goods within the categories, whilst not for other goods within the same categories, the mark as such is not considered to be deceptive. It is in general assumed that the mark will be used in a non-deceptive manner. In other words, Article 7(1)(g) EUTMR does not apply if the specification has broad categories that include goods for which use of the trade mark would be non-deceptive.
According to well-established case law regarding Article 3 (1)(g) of the European Directive 2008/95/E, the circumstances for refusing registration (and mutatis mutandis for cases of invalidation as well) referred to in Article 7(1)(g) EUTMR presuppose “the existence of actual deceit or a sufficiently serious risk that the consumer will be deceived” (C-259/04, ‘Elizabeth Emanuel’, EU:C:2006:215, § 47, and the case-law cited therein, C-87/97, Consorzio per la tutela del formaggio Gorgonzola, para. 41). Behind this wording lies the idea that the threshold for applying the provision must not be set too low, as the relevant public is normally composed of reasonably well-informed, observant and circumspect persons, with the average consumer usually being reasonably attentive, and thus should not be regarded as easily vulnerable to deception.
As noted by Annette Kur, the leader of the so called “Trade Mark Study” conducted under the auspices of the Max Planck Institute that undoubtedly influenced the recent European trade mark law amendment, trademarks are considered deceptive “if they contain an objective indication about characteristics of the goods which is clearly in contrast to the list of goods and services, assuming that the mark would be used as filed for the goods and services claimed in the specification” (See Annette Kur, Martin Senftleben, European Trade Mark Law: A Commentary, 2017, OUP, para. 4.220, p. 177). On the contrary, if there is a possible non-deceptive way of use for a category of goods that falls under the specification, the objection does not apply [Annette Kur, ibid.]
On the other hand, it is an undisputed fact that a fraudulent conduct by the proprietor of any registered trade mark can never be excluded as a future possible scenario, even when the trade mark is not clearly in contrast to the list of goods and services for which protection is sought. However, if there is such an intention on the part of the undertaking, which lodged the application to register that mark, (in order) to make the consumer believe that the goods for which the trade mark is used, are of a specific nature or quality or geographical origin when they are actually not, notwithstanding the fact that such a conduct “might be held to be fraudulent, it could not be analyzed as deception for the purposes of Article 3(1)(g) of Directive 89/104 and, for that reason, could not affect the trade mark itself and, consequently, its prospects of being registered” [Case C-259/04, ‘Elizabeth Emanuel’, EU:C:2006:215 § 50-51]. In other words, the future use of the mark in a way that is liable to mislead the public is a completely different issue from the matter of its registrability and it may be encountered pursuant to national unfair competition laws (see Article 6 Unfair Commercial Practices directive) [See Annette Kur, Martin Senftleben, European Trade Mark Law: A Commentary, 2017, OUP, p. 178, footnote 478].
Subsequently, the standard practice of the EUIPO that stems from these subtle but clear and sound trademark case-law considerations is to make the twin assumptions that: 1. there is no reason to assume that a trade mark application has been filed with the intention of deceiving customers. No deceptiveness objection should be raised if a non-deceptive usage of the mark is possible vis-à-vis the goods and services specified: that is to say, an assumption is made that non-deceptive use of the sign will be made if possible. 2. the average consumer is reasonably attentive and should not be regarded as particularly vulnerable to deception. An objection will generally only be raised where the mark leads to a clear expectation that is patently contradictory to, for instance, the nature or quality or geographical origin of the goods. [Consolidated Version 1.0 of the Guidelines of the Office, 1.8.2016, Part B, Section 4, Chapter 8, p. 3]
A different result is only warranted if the mark clearly contradicts the list of goods or services indicated in the application in the sense that the use of the mark on these goods would be necessarily deceptive. Such a clear contradiction between the mark and the list of goods existed in the use of the mark “WINE OH” for mineral water, which led the Boards of Appeal to a decision that cannot go unnoticed because of its lively, brilliant and monumental wording: “The term ‘wine’ contained in the sign applied, is in clear and irreconcilable contrast to ‘mineral water’ and the other goods claimed in Class 32, none of which are wine. Water is not wine. The difference between water and wine is obvious in terms of the nature of the goods….. Promoting a mundane product such as mineral water or table water as wine is therefore a false indication regarding the nature and quality of the goods…” [ See EUIPO Boards of Appeal decision, 7 March 2006, R 1074/2005-4, WINE OH.’v. OHIM].
In another relevant Boards of Appeal case, during the appeal proceedings the applicant of the trademark ‘TITAN’ that sought protection for portable and relocatable buildings and construction components, in an attempt to overcome an objection of descriptiveness, offered to restrict the specifications in both classes by adding, at the end, the indication “none of the aforesaid goods being made from or including titanium”. The Board held that such a restriction, if accepted, would have had the effect of rendering the trade mark deceptive from the standpoint of the German speaking public, as they would assume that the goods were made from titanium when in reality this was not the case. As a result, the appeal of the applicant was dismissed and the trademark was rejected on the grounds that the sign applied for clearly and objectively contradicted the defined list of goods and services (see Decision of the First Board of Appeal R 422/1999-1 of 13 September 2000, ‘Titan’, para. 18).
A paradigmatic example of such deceptive use is the one included in the EUIPO guidelines, such as the use of the imaginary mark “ELDORADO CAFÈ LATINO” for the goods tea, chicory and chicory flavorings, i.e. products which objectively, necessarily and undisputedly cannot fall within the product category of coffee, as they neither are coffee, nor they consist of or taste like it. In line with this imaginary example, the Boards of Appeal confirmed the rejection of the mark ‘Caffee Veloce’ for the goods ‘tea, cocoa, artificial coffee” in Class 30, on the grounds that the consumer would falsely believe that these goods offered by the applicant contained coffee [See Judgment R 1692/2014-1 of the First Board of Appeal of 3 December 2014, ‘Café Veloce’, para. 31-32.]. As the General Court precisely described the situation in a recent, similar with the above mentioned imaginary case: “the mark applied for will be perceived as a direct and obvious reference to the nature of the goods and of the services relating to the goods; in this instance, it will be understood as an indication that they are or contain coffee or taste like ……….coffee” [Judgment of the General Court dated 27 October 2016 in Case T 29/16 CAFFÈ NERO, para. 8]
In fact, the General Court does not walk away from the well-established interpretation of Article 7(1)(g) as it has been consistently settled by the Court of Justice of the European Union, but on the contrary, it follows it strictly and faithfully, ending up to the exact same conclusion. Regarding the facts of the case, the application for registration in addition to coffee and coffee-related items, covered inter alia, coffee substitutes, herb tea, tea beverages, cocoa and cocoa-based preparations, cocoa beverages, preparations and mixes for making the aforesaid goods and powdered chocolate. As it would be expected, the Boards of Appeal held that consumers were likely to believe that these goods were or contained coffee even though they did not. Thus, especially when taking into consideration that such items were often bought in haste, it was likely that consumers would pick these items off the shelf with the erroneous belief that these items were made with coffee. [See Judgment CAFFÈ NERO, ibid. para. 45]
As a result, the Court in fact held that, “once the existence of actual deceit or a sufficiently serious risk that the consumer will be deceived has been established, it becomes irrelevant that the mark applied for might also be perceived in a way that is not misleading”. This conclusion is based on the fact that for all the above mentioned non-coffee goods, “the mark is, on any view, of such a nature as to deceive the public and is therefore unable to fulfill its role, which is to guarantee the origin of the goods and services to which it refers” [See Judgment CAFFÈ NERO, ibid. para. 48]. In other words, what the General Court notices is that owing to the fact that the mark “CAFFE NERO” was objectively, necessarily and patently contradictory to the nature of the non-coffee related goods, the serious risk of consumer’s deception was so intensively established, that the mere possibility of a non-deceptive use for coffee related products was not sufficient for the application of Article 7 (1)(g) to be excluded.
On the contrary, when the contested trademark is under no circumstances, objectively in contrast to the nature of the goods and the use of the mark for the goods listed in the respective trade mark registration and for which protection is sought would always manifest in a comprehensive and clear way the nature of the goods, no such actual deceit or a sufficiently serious risk of consumer’s deception can be established. In such cases, the possibility of a non-deceptive use of the contested mark towards all the listed goods, cannot be considered irrelevant when assessing the possible deceptiveness of the mark, owing to the fact that no actual deceit or serious risk of consumer’s deception has been established.
