Judgment of the Court of Justice of June 11, 2020 (C-115/19 P)
On October 14, 2014, CHINA CONSTRUCTION BANK CORP. filed an application for the European Union figurative mark Fig. 1 in Class 36. The French entity GROUPEMENT DE CARTES BANCAIRES filed an opposition based on the European Union figurative trademark shown in Fig. 2in Class 36. The opposition was based on Articles 8(1)(b) and 8(5) of the EUTM Regulation.
Fig. 2 
The Opposition Division upheld the opposition by applying only Article 8(1)(b) of the EU Trade Mark Regulation. The applicant’s subsequent appeal was dismissed by decision of June 14, 2017 (R-2265/2016/1). The EUIPO Board of Appeal took into account, primarily, the reputation of the CB mark in France and found that, at least in France, there was a likelihood of confusion between the conflicting marks. Based on these circumstances, it upheld the refusal of the figurative mark CCB by applying Article 8(1)(b) of the EUTMR.
The appeal before the General Court (GC) was dismissed by judgment of December 6, 2018 (T-665/17). It is worth noting that the GC reaffirmed the high degree of distinctiveness of the earlier CB trademark in France in relation to “bank cards.” Furthermore, it took this reputation into account when assessing the similarity between the distinctive elements of the trademarks at issue. Finally, the GC extended the recognition of that reputation to the following services, which it considered a general category: financial services, monetary services, and banking services.
In its statement of grounds for the appeal, CHINA CONSTRUCTION BANK CORP. argued, among other things and as its first ground, that the General Court had erred in law by taking into account, during the phase of its examination involving the assessment of the similarity between the conflicting signs, the reputation of the earlier trademark, and by again taking that reputation into account in the overall assessment of the likelihood of confusion; thus, the General Court had twice taken into account the high distinctiveness of the earlier trademark. It also alleged a lack of reasoning and, in particular, that the General Court had failed to provide a rationale for its finding that the earlier trademark enjoyed a reputation and therefore possessed a high degree of distinctiveness with respect to financial services, monetary services, and banking services; it also criticized the fact that the General Court’s judgment had not explained why the evidence of use of the earlier mark, which specifically related to payment cards, could justify such a general conclusion.
In its June 11, 2020, judgment (C-115/19), the Court of Justice upheld both grounds and set aside both the General Court’s judgment and the decision of the EUIPO Board of Appeal. In this brief commentary, we will focus on analyzing the first ground of appeal and, in particular, on the role played by the high degree of distinctiveness or the reputation of the earlier mark when applying Article 8(1)(b) of the EU Trade Mark Regulation.
As is well known, this article requires the cumulative presence of the following three circumstances for its application: a) Identity or similarity between the signs comprising the trademarks in dispute; b) Identity or similarity between the goods and/or services distinguished by the respective trademarks; c) that the concurrence of the foregoing circumstances leads the public to believe that the goods or services covered by the prior trademark and those covered by the applied-for trademark originate from the same company or, where applicable, from economically related companies; that is, a risk of direct confusion or a risk of indirect confusion (risk of association).
Well, the Court of Justice clarifies in the judgment we are discussing that the “renown or high distinctiveness of the earlier trademark cannot be taken into account when examining the similarity between the distinctive elements that make up the trademarks in dispute, since —unlike the factor of similarity between the conflicting signs—the factor of the reputation and distinctiveness of the earlier trademark does not involve a comparison between several signs, but rather refers solely to a single sign; namely, the one that the opponent has registered as a trademark. Since, therefore, these two factors have fundamentally different scopes, an examination of one of them does not allow conclusions to be drawn regarding the other. Even if the earlier trademark has a high degree of distinctiveness due to its reputation, that circumstance does not allow for a determination of whether that trademark is similar to the trademark applied for in visual, phonetic, and conceptual terms, and, if it is similar, to what degree.”
In fact, the assessment of the similarity of the conflicting signs consists of a visual, phonetic, and conceptual comparison based on the overall impression that such signs leave in the memory of the relevant public, taking into account their intrinsic qualities. It can be stated that the examination of the similarity of the signs referred to in the first of the factors necessary for applying Article 8(1)(b) of the EU Trade Mark Regulation must follow fundamentally objective criteria (dominant element, vowel scale, etc.) which, moreover, are predetermined by the set of elements that make up the marks in dispute, as they appear in the Trademark Register. Under no circumstances may the reputation or high distinctiveness of the earlier trademark influence this comparative analysis.
A separate issue is the influence of the prior trademark’s reputation when analyzing the third of the cumulative circumstances required by Article 8(1)(b) of the EUTM Regulation, which refers to the existence of a likelihood of confusion or association, since such a likelihood may be more probable if the prior trademark has a reputation or a high degree of distinctiveness. In other words, reputation may justify applying a higher standard of scrutiny when assessing whether there is a likelihood of confusion or association between the conflicting trademarks, but such a standard cannot be applied to the prior and necessary factor of whether or not there is similarity between the trademarks themselves.
In any case—and to conclude—it cannot be overlooked that in those instances where there is some degree of objective similarity between the distinctive elements of the trademarks, but this similarity is not sufficient to create a risk of confusion or association among the public that would preclude the application of Article 8.1.b of the EUTM Regulation, it may still be possible to invoke Article 8(5) of the EUTM Regulation if the circumstances required for its application under that provision are met. In this regard, we must recall that, according to extensive case law, the degree of similarity between the conflicting signs required to apply Article 8(5) of the EUTM Regulation is lower than that required under Article 8(1)(b) of the EUTM Regulation. Furthermore, the existence of a link between the two trademarks, as established by Article 8.5 of the EUTM Regulation, is—also according to European case law—more likely to occur the greater the reputation of the earlier trademark.
Author:Jesús Gómez Montero, Former Partner at ELZABURU and Member of the Advisory Committee of the Alberto Elzaburu Foundation