Practice Amendment Notice

PAN 6/07 - Issued 17 July 2007

Evidence of acquired distinctiveness through use

This notice tidies up - but does not change- practice in relation to marks used as part of, or in conjunction with, other marks.

There is also a significant clarification in relation to the required geographical area of use needed for a mark to demonstrate acquired distinctiveness. This has been brought about by the ECJ’s ‘Europolis’ case (C-108/05). Paragraphs 45.1 – 45.9 have been amended, but paragraph 45.10 – 45.15 remain the same.

45 Evidence of distinctiveness acquired through use

The proviso to Section 3(1) makes it clear that a trade mark which offends Section 3(1)(b), (c) or (d) of the Act may still be registered if it can be shown that, by the date of application, the mark has in fact acquired a distinctive character as a result of the use made of it.

45.1 The Test

In Windsurfing Chiemsee (C108&109/97) [1999] ETMR 585, the ECJ provided guidance as to the conditions which should result in a finding that a trade mark has acquired a distinctive character through use. The court found that:

"If the competent authority finds that a significant proportion of the relevant class of persons identify goods as originating from a particular undertaking because of the trade mark, it must hold the requirement for registering the mark to be satisfied."

45.2 Mark must have been used distinctively – as a trade mark

In the Philips v Remington judgment, C-299/99, the ECJ found that the fact that an undertaking is the only known supplier of a kind of goods/services does not preclude a finding that a mark has acquired a distinctive character for the goods/services.However, the court pointed out that such a finding was only possible where reliable evidence shows that recognition of the mark as indicating the goods/services of one undertaking is as a result of its use as a trade mark.

According to the ECJ in Societe des produits Nestle SA v Mars UK Ltd, Case C-353/03, this means “use of the mark for the purposes of the identification, by the relevant class of persons, of the product or services as originating from a given undertaking.” (see paragraph 29 of the judgment).

In principle, this applies whether or not the applicant is the only supplier of a kind of goods/services to the market. The significance of the monopoly in the product or service is that its effect may make it difficult to gauge whether the public has come to recognise the sign as a trade mark or whether they merely recognise the sign as characteristic of a particular kind of goods or services, and associate that kind of goods/services with the applicant because it is the only known (or the best known) supplier of goods/services of that kind.

Acquired distinctiveness cannot therefore be shown to exist solely by reference to general, abstract data such as pre-determined percentages of recognition by the relevant class of persons: Windsurfing and Philips. Instead the views of an average consumer must also be taken into account. Such a consumer is reasonably well informed, observant and circumspect. Such a consumer is unlikely to have come to recognise a sign as being one that identifies the trade source of the goods/services, unless the proprietor has educated the consumer to that perception.

The less plausible it appears on the face of things that consumers would take the mark in question as serving a trade mark function the more important it is to consider what, if anything, the proprietor has done to nurture the mark into a trade mark. Or to put it another way, the more descriptive or non-distinctive the mark appears, the more work the proprietor will have to put in to educate consumers that it is a trade mark. Where the mark has been used on a substantial scale as the sole or principal means of identifying the trade source of the goods it will often be quite easy to conclude from the context of the use that the public have been educated to see the mark as a trade mark.

45.3 Secondary trade marks

In Societe des produits Nestle SA v Mars UK Ltd, Case C-353/03, the ECJ determined that a mark may acquire a distinctive character as a result of it being used as part of, or in conjunction with, another mark. There is therefore no requirement for a nondistinctive mark to have been used alone before it can be registered on the basis of acquired distinctiveness, but where such a mark is used alongside another distinctive sign the burden on the applicant to show that the non-distinctive mark has come to be seen as a secondary trade mark will be greater, as in the British Sugar v Robertson case, [1997] E.T.M.R. 118.

Where the evidence shows that the trade mark is used together with another distinctive trade mark it may still be possible to accept the application provided the evidence indicates that the sign applied for has been used as a secondary trade mark.Here is an example which does not show that the applied for mark has been used as a trade mark.

Mark Applied For: Mark Shown in Use in Evidence:

In this case the word “Yorkshire” is merely used as a description of the geographical origin of the goods (beer).

Here is an example which does show the secondary mark in use as a trade mark:

Mark Applied For: Mark Shown in Use in Evidence

In this example the word “lovely” has been dressed up to have the appearance of a secondary brand. It is not just a question of relative size. The degree of descriptiveness is also important. Simply increasing the size of the word “perfume” would never turn it into a trade mark for those goods. In this case, the presentation presents the mark as a brand name for the product. Non-traditional marks, particularly colours and the appearance of the goods or their packaging, often pose particular problems. Such marks are seldom used as the principal means of distinguishing the trade source of the goods or services. Nevertheless, they are capable of being used as secondary trade marks. The key issue will usually be whether the proprietor has used the mark distinctively to educate the public that it is a trade mark. The most obvious way of educating the public that such a mark is a trade mark is for the proprietor to indicate this in its advertising by the use of statements such as “look for the one with the [blue] wrapper” or “you can rely on the [description of appearance of goods or packaging] to tell you its a [brand name]”.

In this connection, it should be noted that the use of small letters “tm” in relation to a mark with no trade mark character is more likely to make an impression on a lawyer than on an average consumer.

If there is evidence that the applicant applies the same styling feature to the shapes of a range of goods of the same kind, this may assist in educating the public that the feature has some trade mark significance. On the other hand, evidence that the undertaking produces a large number of similar kinds of products, all with different shapes, tends to point in the other direction.

One means of signifying the trade mark significance of colours is to use them as a livery, i.e. as a consistent colour scheme applied to a range of products of the same general kind so as to designate the trade source. The use of such liveries for buses, trains and vehicle service stations are good examples of such use in relation to services. On the other hand, evidence that an applicant uses a wide range of colour schemes in relation to goods or services of the same kind tends to point away from the trade mark significance of any one such colour scheme.

Where there is doubt as to whether the proprietor has done enough to educate the elevant public that at least one of the functions of the sign in question is to identify the product or services as those of a single undertaking, evidence that the relevant public has come to rely upon the sign in question for the purpose of distinguishing between goods/services of different undertakings may be sufficient to show that the sign is recognised as serving a trade mark function. The best evidence of reliance is that which shows that (and in what way) those making selection decisions between competing products or services have come to rely upon the sign in the course of the selection process. Evidence of mere abstract recognition of the sign is unlikely to assist if the doubt is not about the extent of the use of the sign, but rather whether it is used for the purpose of identifying the goods or services of one particular undertaking.

45.4 Evidence – Pure colour marks

Evidence filed to support a claim of factual distinctiveness for a mark consisting of colour as such will need to be very persuasive. It will clearly need to demonstrate that the mark alone (whether or not it has actually been used alone) would serve to designate the goods or services of one particular undertaking to the relevant consumer. There is more likelihood of establishing factual distinctiveness where the goods or services are very restricted and the relevant market very specific. Deciding whether a single colour is distinctive raises complex issues and examiners should consult with an evidence specialist before finally accepting or refusing applications for single colour marks.

45.5 Use of the Mark as Part of another trade mark

In the light of the ECJ’s judgment in Societe des produits Nestle SA v Mars UK Ltd, Case C-353/03, it is clear that, as a matter of law, there is no bar on a mark acquiring a distinctive character as a result of its use as part of another trade mark. Word marks are often used with device marks but that does not mean that the consumer could not regard the word (or device) element as having an independent distinctive role within the composite mark. The question is whether the mark applied for, if used alone, would distinguish the goods/services listed in the application in the perception of a relevant average consumer. Where the use relied upon by the applicant is likely to be perceived by relevant consumers as use of the mark only as part of another mark, establishing a claim of acquired distinctiveness for the part alone is likely to be much more difficult.

For example, use of the mark on the right below could not be perceived as simply use of the trade mark “Quality”. Therefore use of the mark on the right ought not to result in the inference being drawn that the word “Quality” as such has become distinctive of the applicant. It will be for the applicant to establish through evidence that the result of the use of the mark on the right is that the relevant class of persons actually perceive the product or service, designated exclusively by the mark applied for (on the left), as originating from a given undertaking.

Small differences between the mark applied for and the mark which has been used, which do not alter the distinctive character of the mark, may be ignored. For example, the use of the mark below should be considered as use of the word PREMIER as such.

45.6 Examination of evidence – Gauging the extent and effect of Trade Mark use Having established that the mark has been used as a trade mark (including use as a secondary trade mark or playing an independently distinctive role in a composite mark) the next thing is to assess the extent and effect of the use. The ECJ provided guidance on the relevant factors in the Windsurfing case (see above). The court stated that:

“In assessing the distinctive character of a mark in respect of which registration has been applied for, the following may also be taken into account:

a) the market share held by the mark;

b) how intensive, geographically widespread and long-standing use of the mark has been;

c) the amount invested by the undertaking in promoting the mark;

d) the proportion of the relevant class of persons who, because of the mark, identify goods as originating from a particular undertaking;

e) statements from chambers of commerce and industry or other trade and professional associations”.

45.7 Market share

It is necessary to have some idea of the market share held by the applicant under the mark applied for. For example, several hundreds of thousands of pounds per annum in the dairy produce sector will be a tiny proportion of the market and it is unlikely that such turnover will have educated a significant proportion of the relevant public to perceive the mark as a trade mark. On the other hand, this level of use on an established specialist publication may well have reached a significant proportion of the relevant public for the product.

45.8 Turnover and period of use

Evidence normally includes the date use first commenced and must relate to use before the date of filing. Any use after that date should not be taken into account. If there have been gaps in the use, it will be necessary to consider how this affects the reputation of the mark applied for. For example, a strawberry grower may not be able to demonstrate sales throughout the year, but if he sells his strawberries for two months of the year every year for ten years, that is likely to be sufficient to illustrate continuous use, given the seasonal nature of his product. Another trader might sell goods under a certain mark for twelve years, but there may be a two year gap leading up to the date of the application in which few or no sales took place. Before a judgement can be made about accepting or refusing the mark, it would be necessary to look at all the surrounding facts to see what effect that gap had. If sales weren’t particularly strong beforehand, the reputation of the mark may have been severely diminished. If, on the other hand, sales were very good both before and after any gap, it may be that the gap would have no negative effects on the reputation at all.

Turnover figures should normally be given for the sales of goods/services under the mark over a period of about five years before the date of application. If the period of use is shorter, figures for the period in question should be given.

The greater the turnover, the more likely it is for the mark to be accepted. Turnover, advertising and period of use are considered together - massive turnover and/or advertising could compensate for a short period of use.

Ideally, the turnover figures should be broken down to give the turnover relating to each class of goods/services. However, industry does not group its products according to the WIPO system of classification, so this may not be a practical proposition. There should however be sufficient breakdown of the goods/services to support a finding that the relevant public has been repeatedly exposed to the mark in use as a trade mark for all the goods/services for which acceptance is proposed.

In the case of financial services, turnover figures may not always be the appropriate means to gauge the extent of use of the trade mark. For example, turnover figures which are merely the total amount loaned or insured by the applicant will give an inflated picture in relation to how well-known the mark is in terms of exposure to the relevant public. However, a clear indication of the extent of use is required if the applicant is relying on this to demonstrate that the mark has acquired a distinctive character. In the case of financial services the number of account holders or investors and, if appropriate, the number and geographical spread of branches, could be used to demonstrate the extent of the use.

45.9 Area of use

Within the UK: a list of the areas of sale is normally included within the declaration. Sometimes no specific areas are given and phrases like "throughout the UK" or "in England and Wales" are used instead.

In Bovemij Verzekeringen NV v Benelux Merkenbureau, Case C-108/05, the ECJ held that in order for a trade mark to be registered on the basis of acquired distinctiveness, “only if it is proven that that trade mark has acquired distinctive character through use throughout the territory of a member state.” Accordingly, it is not possible to register a trade mark on the basis of distinctiveness acquired on a local or regional basis. The ECJ’s judgments are binding and conclusively determine the meaning of those provisions of national law that give effect to the Trade Marks Directive. Consequently, national procedural provisions, such as the entry of geographical limitations under s.13 of the Act, do not allow the Examining Authority in the UK to interpret the proviso to s.3(1) in a way that permits registration in circumstances that are incompatible with the Bovemij judgment. Accordingly, other than in the circumstance described below, it will not be possible to register a trade mark on the basis of acquired distinctiveness within an area of the UK, even with an associated geographical limitation of rights. So, for example, it will not be sufficient to prove that a mark consisting of English words which describe a characteristic of the goods or services has acquired a distinctive character in Scotland alone.

The Bovemij judgment also considered the position where the trade mark is a word in a language which is only spoken and understood in a part of the member state. In these circumstances the ECJ decided that it is sufficient to prove that the mark has acquired a distinctive character in the relevant linguistic area. For example, a Welsh word which describes the goods applied for may be registered if it is shown that it has acquired a distinctive character to a substantial proportion of the Welsh speaking population in Wales.

It should be borne in mind that the requirement for use throughout the territory of the member state includes use in advertising. Accordingly, it is not necessary to show that sales have occurred throughout the member state if the mark has acquired a distinctive character on a UK wide basis through national advertising.

Furthermore, the court’s judgment cannot have been intended to have the effect of preventing the registration of a trade mark which has become factually distinctive to a significant proportion of the relevant UK public simply because there is a small discrete areas of the UK in which the mark has not become distinctive. Accordingly, failure to show that a trade mark has become distinctive in (say) the Isle of Man, will not prevent a national registration on the basis of acquired distinctiveness.

For export: occasionally, turnover figures also include goods for export. These figures may also be taken into account when considering the strength of the evidence. If turnover relates to goods manufactured in this country which are only for export, the evidence will not be sufficient to demonstrate that the mark has acquired a distinctive character amongst a significant proportion of the relevant UK public.

Outside the UK: if the only use of the mark is outside the UK, the mark cannot be accepted. Section 3(1) requires the mark in question to be factually distinctive in the relevant markets in the UK.