Court of Justice of the European Communities (including Court of First Instance Decisions)

(Community trade mark Opposition proceedings Application for the Community word mark SPALINE Earlier national word mark SPA Relative ground for refusal Damage to reputation Unfair advantage derived from the reputation of the earlier mark Use of the mark applied for without due cause Article 8(5) of Regulation (EC) No 40/94)

In Case T-21/07,

L'Oréal SA, established in Paris (France), represented by E. Baud, lawyer,

applicant,

Office for Harmonisation in the Internal Market (Trade Marks and Designs) (OHIM), represented by A. Folliard-Monguiral, acting as Agent,

defendant,

the other party to the proceedings before the Board of Appeal of OHIM, intervener before the Court of First Instance, being

Spa Monopole, compagnie fermière de Spa SA/NV, established in Spa (Belgium), represented by E. Cornu, L. De Brouwer, D. Moreau and E. De Gryse, lawyers,

ACTION brought against the decision of the First Board of Appeal of OHIM of 18 October 2006 (Case R 415/2005-1), concerning opposition proceedings between Spa Monopole, compagnie fermière de Spa SA/NV and L'Oréal SA,

composed of M. Vilaras, President, M. Prek (Rapporteur) and V. Ciucă, Judges,

Registrar: N. Rosner, Administrator,

having regard to the application lodged at the Registry of the Court of First Instance on 29 January 2007,

having regard to the response of OHIM lodged at the Registry of the Court on 10 May 2007,

having regard to the response of the intervener lodged at the Registry of the Court on 7 May 2007,

further to the hearing on 6 November 2008,

gives the following

Background to the dispute

1. On 19 November 1998 Artec Systems Group, Inc. filed an application for registration of a Community trade mark with the Office for Harmonisation in the Internal Market (Trade Marks and Designs) (OHIM) pursuant to Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark (OJ 1994 L 11, p. 1), as amended.
2. The mark in respect of which registration was sought is the word mark SPALINE.
3. The goods in respect of which registration was sought come within Class 3 of the Nice Agreement of 15 June 1957 concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks, as revised and amended, and correspond to the following description: 'Bath and shower soaps, skin moisturisers, body lotions, skin toners, astringents, skin and body cleansers, facial masks, scrubs, and fragrance products, namely perfumes, colognes, eau de toilette and oils'.
4. The application for registration was published in Community Trade Marks Bulletin No 82/2000 of 16 October 2000.
5. On 15 January 2001 the intervener, Spa Monopole, compagnie fermière de Spa SA/NV, filed a notice of opposition, pursuant to Article 42 of Regulation No 40/94, against registration of the mark applied for with respect to all the goods covered by the latter.
6. In support of its opposition, the intervener invoked, in particular, Article 8(5) of Regulation No 40/94, relying on the reputation of its word mark SPA, which had been registered with the Benelux Trade Mark Office on 21 February 1983 under No 389 230, with respect to 'mineral water and aerated waters and other non-alcoholic beverages, syrups and other preparations to make beverages' in Class 32. The intervener also invoked Article 8(1)(b) and (4) of Regulation No 40/94, relying on a number of previous registrations.
7. Following a request to that effect, the intervener filed documents with a view to proving the genuine use of its earlier marks, as well as the reputation of the earlier word mark SPA.
8. On 29 September 2004, the application for registration was transferred to the applicant, L'Oréal SA.
9. By decision of 16 March 2005, the Opposition Division of OHIM upheld the opposition, taking the view that the conditions of Article 8(5) of Regulation No 40/94 had been fulfilled. The Opposition Division did not examine the grounds for refusal under Article 8(1)(b) and (4) of Regulation No 40/94, and relied solely on the reputation of the earlier word mark SPA ('the earlier mark').
10. On 13 April 2005, the applicant filed an appeal with OHIM against the decision of the Opposition Division.
11. By decision of 18 October 2006 ('the contested decision'), the First Board of Appeal of OHIM dismissed the appeal on the ground that the conditions of Article 8(5) of Regulation No 40/94 had been satisfied. The Board of Appeal held, first of all, that the earlier mark had a reputation in the Benelux countries in respect of mineral waters, referring, in particular, to the position adopted by the Court in its judgment in Case T-67/04 Spa Monopole v OHIM Spa-Finders Travel Arrangements (SPA-FINDERS) [2005] ECR II-1825. With respect, next, to the similarity of the signs, the Board of Appeal took the view, in essence, that this had been established since the earlier mark was included in the mark applied for. Finally, the Board of Appeal found that there was in this case a likelihood in the circumstances that the applicant would, by making use of the mark applied for, take unfair advantage of the reputation of the earlier mark in the light of the highly distinctive character of the word 'spa' and the close relationship between the goods in question. The Board of Appeal did not accept the applicant's argument that the term 'spa' was descriptive of cosmetic products and that, consequently, the use of the sign SPALINE was not without due cause in respect of those products.

Forms of order sought

12. The applicant claims that the Court should:

annul the contested decision;

order OHIM and, if necessary, the intervener, to pay the costs.

13. OHIM and the intervener contend that the Court should:

dismiss the action;

order the applicant to pay the costs.

Law

14. As a preliminary point, it must be noted that OHIM and the intervener challenge the admissibility of numerous annexes to the application, on the ground that they include documents presented for the first time before the Court. In the present case, however, it is not necessary to verify the admissibility of each of the annexes challenged by OHIM and the intervener, as the Court can appraise the applicant's arguments in light of the documents presented during the administrative procedure and contained in the case-file before OHIM, which has been forwarded by the latter to the Court in accordance with Article 133 of the Rules of Procedure.
15. The applicant relies on a single plea alleging infringement of Article 8(5) of Regulation No 40/94.
16. According to the wording of Article 8(5) of Regulation No 40/94, its application is subject to the following conditions: first, that the marks at issue are identical or similar; secondly, that the earlier mark cited in opposition has a reputation; and, thirdly, that there is a risk that the use without due cause of the trade mark applied for would take unfair advantage of, or be detrimental to, the distinctive character or the repute of the earlier trade mark. Those conditions are cumulative and failure to satisfy one of them will be sufficient to render that provision inapplicable (Case T-215/03 Sigla v OHIM Elleni Holding (VIPS) [2007] ECR II-711, paragraph 34, and Case T-93/06 Mülhens v OHIM Spa Monopole (MINERAL SPA), not published in the ECR, paragraph 25).
17. According to established case-law, the protection provided by Article 8(5) of Regulation No 40/94 is not conditional on the finding of such a degree of similarity between the marks in question that there is a likelihood of confusion between them on the part of the relevant public. It suffices that the degree of similarity between those marks causes the relevant public to establish a link between them (see Case T-137/05 La Perla v OHIM Worldgem Brands (NIMEI LA PERLA MODERN CLASSIC), not published in the ECR, paragraph 34 and the case-law cited).
18. The existence of such a link, as well as a likelihood of confusion within the meaning of Article 8(1)(b) of Regulation No 40/94, must be assessed globally, taking into account all factors relevant to the circumstances of the case (VIPS, cited in paragraph 16 above, paragraph 47). Therefore, that global assessment must, with respect to the visual, aural or conceptual similarity of the signs at issue, be based on the overall impression given by those signs, bearing in mind, in particular, their distinctive and dominant components (NIMEI LA PERLA MODERN CLASSIC, cited in paragraph 17 above, paragraph 35).
19. It follows from established case-law that the concept of the unfair advantage which would be taken of the repute of the earlier mark by the use without due cause of the mark applied for consists in the fact that the image of the mark with a reputation or the characteristics which it projects are transferred to the goods covered by the mark applied for, with the result that the marketing of those goods is made easier by that association with the earlier mark with a reputation (VIPS, cited in paragraph 16 above, paragraph 40; and MINERAL SPA, cited in paragraph 16 above, paragraph 40).
20. The legality of the contested decision must be assessed in the light of those principles.
21. It should be noted that the public targeted by each of the trade marks consists of the general public, in so far as both the goods covered by the earlier mark and those referred to in the trade mark application are everyday consumer goods. As the earlier mark was registered for the Benelux countries, the Board of Appeal acted correctly in holding, in paragraph 28 of the contested decision, that the relevant public was composed of average consumers in those Member States.
22. First, the reputation of the earlier mark for mineral waters is not in dispute between the parties.
23. Second, as regards the condition relating to whether the trade marks are identical or similar, it is appropriate to compare the earlier mark (SPA) and the mark applied for (SPALINE).
24. In aural and visual terms, the presence of the element 'spa' at the beginning of the trade mark applied for appears sufficient, in the present case, to justify the view that the trade marks in question have a degree of similarity. Concerning the effect of the presence of the element 'line' in the mark applied for, this is not enough to prevent the impression of aural and visual similarity resulting from the comparison of the marks in question. In this respect, it should be recalled that the consumer generally pays greater attention to the beginning of a mark than to the end (Case T-133/05 Meric v OHIM Arbora & Ausonia (PAM-PIM'S BABY-PROP) [2006] ECR II-2737, paragraph 51).
25. In conceptual terms, it should be noted that the presence of the element 'line' in the mark applied for, far from distinguishing the marks in question, tends, on the contrary, to establish a conceptual link between them. The word 'line', a term belonging to basic English vocabulary, the meaning of which the relevant public can be supposed to understand without difficulty, is very often used in the area of cosmetics to refer to a range, or 'line', of products, as the Board of Appeal correctly observed in paragraph 34 of the contested decision.
26. There is, therefore, a similarity between the marks SPA and SPALINE. The arguments put forward by the applicant are not such as to invalidate that conclusion.
27. First, it must be noted that the applicant claims that the marks cannot be considered to be similar within the meaning of Article 8(5) of Regulation No 40/94, on the ground that the word 'spa' does not constitute the dominant and distinctive component of the mark applied for. The applicant submitted in the application that the word 'spa' is descriptive and generic with respect to cosmetic products before stating, during the hearing, that its argument was to be understood as meaning that the word 'spa' is descriptive and generic in respect of one of the uses or destinations of cosmetic products, that is to say, places for hydrotherapy such as hammams or saunas.
28. It must be noted that the applicant is wrong to claim in the application that the word 'spa' is descriptive and generic with respect to cosmetic products covered by the mark applied for. The evidence provided by the applicant during the administrative procedure and included in the case-file before OHIM demonstrates only that that term may be descriptive and generic when it refers to places for hydrotherapy such as hammams or saunas and not that it is descriptive and generic in reference to the cosmetic products covered by the mark applied for. The only element supporting the applicant's argument is a decision of the Tribunal de grande instance de Paris (Regional Court, Paris). However, the probative value of that decision is limited. First, that decision is likely to concern only the perception of one part of the relevant public, namely the French-speaking public of the Benelux countries. Second, it appears that the position taken in that decision has been contradicted by other courts, including the Cour d'appel de Paris (Court of Appeal, Paris).
29. The other elements adduced by the applicant during the administrative procedure before OHIM, such as the extracts from dictionaries, evidence based on the use of the word 'spa' in the press and on the internet, or also the survey carried out in the Netherlands on how the word 'spa' is understood, serve only to demonstrate the descriptive and generic character of the word 'spa' in respect of places for hydrotherapy such as hammams or saunas.
30. Concerning the references to OHIM's decision-making practice, suffice it to note that, according to settled case-law, the legality of the decisions of Boards of Appeal must be assessed solely on the basis of Regulation No 40/94, as interpreted by the Community Courts, and not on the basis of a previous decision-making practice of those boards (Case T-112/03 L'Oréal v OHIM Revlon (FLEXI AIR) [2005] ECR II-949, paragraph 68 and the case-law cited).
31. Furthermore, while the applicant's assertion during the hearing that the word 'spa' is only descriptive and generic of one of the places in which cosmetic products are used or marketed, that is to say, places for hydrotherapy such as hammams and saunas, appears to be correct, it cannot, however, be inferred from this that that word is, consequently, descriptive or generic with respect to cosmetic products. The links connecting cosmetic products to places for hydrotherapy are, because of their use in that context, not such that the conclusion regarding the descriptive or generic character of that word can be extended to them. Therefore, the word 'spa' used in the context of cosmetic products cannot be considered to be devoid of all distinctive character.
32. Consequently, and in view of the very frequent use of the word 'line' in the area of cosmetics, the Board of Appeal acted correctly in taking the view, in paragraph 34 of the contested decision, that the word 'spa' was the most distinctive component of the mark applied for.
33. Second, the fact, relied on by the applicant, that the mark applied for consists of a single word is irrelevant, since the word created by the combination of the two elements 'spa' and 'line' does not have a meaning independent from that of its component parts.
34. Third, the fact that the word 'spa' has other meanings (as an acronym of 'Sanitas Per Aqua' or 'Sanus Per Aqua', in particular), and therefore does not refer exclusively to the intervener's mineral waters, is also irrelevant. In view of the similarity of the products covered by the marks at issue, it must be observed that the element 'spa' in the mark applied for (SPALINE) will be primarily associated, by the average consumer in the Benelux countries, with the mineral waters marketed under the intervener's mark.
35. Concerning the link between the marks which could be made by the relevant public because of that similarity, account must also be taken, as factors relevant to the assessment of the existence of such a link, of the fact that, first, they target the same public and, second, the goods they cover are similar. It is correct to note, as did the Board of Appeal in paragraph 38 of the contested decision, that thermal waters and cosmetic products can be used in conjunction for skin and beauty treatments and that mineral waters and their mineral salts can be used in the production of soaps and other cosmetic products. Furthermore, the Board of Appeal correctly held that this similarity between the goods was enhanced by the fact that mineral water operators sometimes sell cosmetic products composed of mineral waters.
36. In light of the foregoing, it appears that the relevant public is liable to establish a link between the marks. The conclusion of the Board of Appeal to that effect, set out in paragraph 35 of the contested decision, must therefore be upheld.
37. Third, it is necessary to establish, on the basis of the case-law cited in paragraph 19 above, whether, in the present case, there is a risk that the image of the well-known mark SPA or the characteristics which it projects would be transferred to the goods covered by the mark applied for (SPALINE), in such a way that the marketing of those goods would be made easier by that association with the earlier well-known mark.
38. In that connection, it should be recalled that the proprietor of the earlier mark is not required to demonstrate actual and present harm to his mark, but must adduce prima facie evidence of a future risk, which is not hypothetical, of unfair advantage or detriment (VIPS, cited in paragraph 16 above, paragraph 46). Such a conclusion may be reached, in particular, on the basis of logical deductions made from an analysis of the probabilities and in taking into account the normal practice in the relevant commercial sector, as well as all other circumstances of the case.
39. Moreover, it must also be pointed out that the stronger the link which the relevant public can make between the two marks, the greater will be the risk that the use of the mark applied for will take unfair advantage of the reputation of the earlier mark.
40. The risk of such a transfer has been established in the present case. First, as was noted in paragraph 21 above, the two marks target the same type of public, which, in so far as the earlier mark is registered in the Benelux countries, consists of average consumers in those Member States. Second, it has been shown in paragraph 35 above that the goods covered by the mark applied for are not so different from those covered by the earlier mark. Finally, the image of the earlier mark and the message that it conveys relate to health, beauty, purity and mineral richness. That image and that message can apply also to the goods in respect of which registration has been sought by the applicant, since they are used to preserve and improve health or beauty. Consequently, the applicant could take unfair advantage of the image of the earlier trade mark and the message conveyed by it in that the goods covered by the trade mark applied for would be perceived by the relevant public as bringing health, beauty and purity. Accordingly, the risk of a free-riding transfer of the advertising effort made by the proprietor of the earlier mark to the mark applied for has been established (see, to that effect, MINERAL SPA, cited in paragraph 16 above, paragraphs 41 to 43).
41. That conclusion is not invalidated by the applicant's argument that it would be appropriate to take into account its own undisputed reputation in the area of cosmetics, as well as the significant extent of its own marketing activities. Suffice it to observe in that regard that the applicant's business name is not part of the mark applied for, which precludes the relevant public from associating that mark with that ostensibly well-known name.
42. Concerning the applicant's reference to certain decisions of OHIM, such decisions have no bearing on the legality of the contested decision (FLEXI AIR, cited in paragraph 30 above, paragraph 68).
43. Finally, the applicant's argument alleging due cause for the use of the mark applied for, by virtue of the allegedly descriptive and generic character of the word 'spa' for cosmetic products, must be rejected, since, for the reasons referred to in paragraph 31 above, that character does not extend to cosmetic products, but only to one of their uses or destinations. Consequently, the word 'spa' has not become so necessary to the marketing of cosmetic products that the applicant could not reasonably be required to refrain from use of the mark applied for.
44. Accordingly, the single plea in law alleging infringement of Article 8(5) of Regulation No 40/94 must be rejected and the action consequently dismissed.

Costs

45. Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party's pleadings. As the applicant has been unsuccessful, it must be ordered to pay the costs, in accordance with the forms of order sought by OHIM and the intervener.

On those grounds,

THE COURT OF FIRST INSTANCE (Fifth Chamber)

hereby:

1. Dismisses the action;

2. Orders L'Oréal SA to pay the costs.

Vilaras

Prek

Ciucă

Delivered in open court in Luxembourg on 25 March 2009.

[Signatures]

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* Language of the case: English.