“My Monopoly!” shouts a smiley, moustached old man, shaking its stick at the public. “Bad faith cancellation” shouts back the EUIPO Board of Appeal, partially invaidating the well-known MONOPOLY word mark in its recent decision of 22 of July 2019 (Case R 1849/2017-2).
Anyone smiling yet?
This story is about IP rights and monopolies and, as the best of traditions, it is about the difficult interplay between these (utterly controversial) rights and freedom of expression. Same old story – would say that very same old man.
Still, this time our Monopoly has a Capital M, it comes in a lovely box (all together with dice and printed instructions) and, surprisingly enough, it is available for sale on some of the most popular e-commerce platforms.
Background – Bad faith and re-filing: a definition
In accordance with Article 59(1)(b) EUTMR, an EU trade mark must be declared invalid where the applicant for registration was acting in bad faith at the time of filing the application for the trade mark.
Absent a definition of the notion of bad faith, the EU courts commonly refer to the ground as “a subjective factor which must be determined by reference to the objective circumstances of the particular case” (see, among other, Court of Justice judgement of 11 June, in C-529/07, “Lindt Goldhase”).
In this context, a specific issue is represented by the so-called practice of “re-applications” and “re-filings”, often made by big companies for the purpose of circumventing the “genuine use” requirement.
The position of the EUIPO
European Courts’ position on the question of re-filings has been significantly evolving during the time, also depending on the specific circumstances of the case considered. Overall, the rulings on the topic can be summarised (and grouped) as follows:
- The “hard” line: In the EUIPO’s decision of the Fourth Board of Appeal of 15 November 2011, R 1785/2008-4, “Pathfinder”, the BOA agreed with the allegations of the applicant, requiring the proprietor of the earlier Spanish re-filing for MARS PATHFINDER to furnish evidence of use of the mark, even though it had been registered for less than five years. This conclusion was based on the fact registration was an identical repeat filing of an earlier Spanish registration and, as such, it had been filed in bad faith and solely to avoid revocation of the earlier Spanish registration for non-use. More recently, in Case R-1260/2013-2 (“the Canal+ decision”), the PATHFINDER principle was further extended. In fact, refiling was considered as made in bad faith, even though the goods and services covered by the later marks were not exact reproductions of those set out in the earlier marks
- The “soft” line:Differently, in its decision in GC judgment of 13 December 2012, T-136/11, (“Pelican”), the General Court embraced a more liberal approach. The EU judge, in fact, declined to make a finding of bad faith, considering that the later mark had an “updated” graphic design and that, in addition to this, the list of goods covered was also narrower and more specific. The same approach was also adopted by the GC in its more recent decision of 19 October 2017 in Case T-736/15 (“Skylite”) where the Court ruled against the admissibility of Aldi´s proof of use request given that, at the date of publication of the trademark applied for, the earlier mark had been registered for less than five years and that, in any case, the Pathfinder conditions were not comparable to the Aldi case.
Case R 1849/2017-2 , MONOPOLY, 22 July 2019
On 25 August 2015, Kreativni Dogadaji d.o.o. filed an application for a declaration of invalidity of EUTM no. 009071961 “MONOPOLY” (word), registered in the name of Hasbro Inc. for all the goods and services covered in classes 9, 16, 28 and 41.
The cancellation applicant argued that the contested EUTM was a repeat filing of the EUTM proprietor’s earlier European trade mark registrations No 238 352, No 6 895 511 and No 8 950 776, all of them also covering the sign ‘MONOPOLY’ and therefore the EUTM proprietor had a dishonest intention at the time of filing the contested EUTM.
By decision of 22 June 2017, the Cancellation Division rejected the request for a declaration of invalidity. The applicant filed an appeal against the decision, requesting for oral proceedings to be held.
Board of Appeal’s findings
- Value of oral hearings In its assessment the Board took into special account the testimony of Ms Sara Beccia, of the EUTM proprietor’s company, taking place during the oral hearing, noting that “(…) Ms Beccia in her testimony stated that ‘being able to rely upon one registration without the need to prove use’ was a benefit to the EUTM proprietor and that it was something that was ‘considered by all brand owners and in many different industries” (para.75).Indeed, in this respect, as the BOA concluded “the fact that a filing is not only motivated by the advantage of not having to prove the genuine use of the mark, but other reasons as well, does not, in itself, make such a strategy acceptable”(para. 76).On this basis, the BOA concluded that “refiling of a trademark shall be prohibited any time it is manifestly intended to circumvent the obligation to prove use of earlier marks”(para. 82).
- “Partial” invalidity In the Board’s view, “In general, it must be stated that applying for a large variety of goods and services as such is rather common practice of companies (…) it does not involve conduct that departs from accepted principles of ethical behaviour or honest commercial and business practices”(para. 63). On this ground, in its decision, the BOA partially invalidates the contested EUTM “in so far as it included goods and services already covered by earlier registrations” and, therefore, “it was made in bad faith”. As for the remaining goods and services, the Board concludes that the contested EUTM was filed following a commercial logic and, therefore, it is valid in relation to them.
Potential impact of the BOA decision. Any CHANCE ® for right holders?
By invalidating Hasbro’s word mark, the EUIPO Board of Appeal seems to confirm that “hard line” which was inaugurated with Pathfinder and, conversely, to partly contradict that more liberal approach embraced by the General Court in Pelican and Skylite.
In particular, the decision (if not appealed or reverted in appeal) could have the effect of increasing the burden of proof for trademark owners of “famous” marks. Brand owners, in fact, would now be required to always prove use of their marks and no safety-valve under the mechanism of re-filings would be available to them. Moreover, the BOA ruling of partial invalidity should also be assessed in the light of (and possibly coordinated with) the AG Opinion of 4 April 2019 in C-104/18 P (“Koton”), where the Advocate General, considering the question of intention of use, concluded that “it is not possible to divide the application for registration for the purposes of assessing bad faith” [on this point, see also the upcoming Court of Justice’ preliminary ruling in C-371/18 (“Skykick”)].
As a result, that’s clearly bad times for our stick-shaking mates. And times are even worse for trademark owners. Indeed, when it comes to board games, right holders could rely on copyright law for the purpose of protecting the artwork (or even the instructions) of their creations. However, it might be very difficult for them to meet the threshold of originality. Plus, and in any case, protection under this separate IP right would be confined to some specific aspects of the creation. As such, it would not extend, for example, to the mechanisms of the game.
Yes, life is certainly tough and so board games are. But, SERIOUSLY, what’s wrong with these dice?!