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

JUDGMENT OF THE GENERAL COURT (First Chamber)

5 December 2017 (*)

(EU trade mark — Invalidity proceedings — EU word mark FREE STYLE — Absolute ground for refusal — No distinctive character — Article 7(1)(c) of Regulation (EC) No 207/2009 (now Article 7(1)(c) of Regulation (EU) 2017/1001) — Article 76 of Regulation No 207/2009 (now Article 95 of Regulation 2017/1001) — Equal treatment)

In Case T‑213/16,

El Corte Inglés, SA, established in Madrid (Spain), represented by J.L. Rivas Zurdo, lawyer,

applicant,

v

European Union Intellectual Property Office (EUIPO), represented by S. Bonne, acting as Agent,

defendant,

the other party to the proceedings before the Board of Appeal of EUIPO, intervener before the General Court, being

Elho Business & Sport Vertriebs GmbH, established in Munich (Germany), represented by E. Warnke, lawyer,

ACTION brought against the decision of the First Board of Appeal of EUIPO of 12 February 2016 (Case R 378/2015-1), relating to invalidity proceedings between Elho Business & Sport and El Corte Inglés,

THE GENERAL COURT (First Chamber),

composed of I. Pelikánová, President, V. Valančius (Rapporteur) and U. Öberg, Judges,

Registrar: E. Coulon,

having regard to the application lodged at the Court Registry on 9 May 2016,

having regard to the response of EUIPO lodged at the Court Registry 6 October 2016,

having regard to the response of the intervener lodged at the Court Registry on 2 October 2016,

having regard to the fact that no request for a hearing was submitted by the parties within three weeks after service of notification of the close of the written part of the procedure, and having decided to rule on the action without an oral part of the procedure, pursuant to Article 106(3) of the Rules of Procedure of the General Court,

gives the following

Judgment

1        On 24 November 2005, the applicant, El Corte Inglés, SA, filed an application for registration of an EU trade mark with the European Union Intellectual Property Office (EUIPO) pursuant to Council Regulation (EC) No 207/2009 of 26 February 2009 on the European Union trade mark (OJ 2009 L 78, p. 1), as amended (replaced by Regulation (EU) 2017/1001 of the European Parliament and of the Council of 14 June 2017 on the European Union trade mark (OJ 2017 L 154, p. 1)).

2        Registration as a mark was sought for the following word sign: FREE STYLE.

3        The goods in respect of which registration was sought are in Classes 3, 18 and 25 of the Nice Agreement concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks of 15 June 1957, as revised and amended, and correspond, for each of those classes, to the following description:

–        Class 3: ‘Bleaching preparations and other substances for laundry use; cleaning, polishing, scouring and abrasive preparations; (abrasive preparations)’;

–        Class 18: ‘Leather and imitations of leather, and goods made of these materials and not included in other classes; animal skins, hides; trunks and travelling bags; umbrellas, parasols and walking sticks; whips, harness and saddlery’;

–        Class 25: ‘Clothing, footwear, headgear’.

4        The application was published in Community Trade Marks Bulletin No 18/2006 of 1 May 2006 and the mark was registered on 4 August 2009.

5        On 13 June 2014, the intervener, Elho Business & Sport Vertriebs GmbH, filed an application for a declaration of invalidity against that mark under Article 52(1)(a) of Regulation No 207/2009 (now Article 59(1)(a) of Regulation 2017/1001). The grounds relied on were those referred to in Article 7(1)(b) and (c) of that regulation (now Article 7(1)(b) and (c) of Regulation 2017/1001).

6        By decision of 12 December 2014, the Cancellation Division of EUIPO refused the application for a declaration of invalidity in its entirety, finding that the contested mark was not descriptive of the goods in respect of which it had been registered for the purposes of Article 7(1)(c) of Regulation No 207/2009.

7        On 11 February 2015, the intervener filed a notice of appeal with EUIPO, pursuant to Articles 58 to 64 of Regulation No 207/2009 (now Articles 66 to 71 of Regulation 2017/1001), against that decision of the Cancellation Division and submitted its observations on 10 April 2015.

8        By decision of 12 February 2016 (‘the contested decision’), the First Board of Appeal upheld the appeal in part and declared the contested mark invalid on the ground that it was descriptive in relation to the goods in Classes 18 and 25.

 Forms of order sought

9        The applicant claims that the Court should:

–        annul the contested decision in so far as it annuls the decision of the Cancellation Division and declares the contested mark invalid so far as concerns Classes 18 and 25;

–        order EUIPO and the intervener to pay the costs.

10      EUIPO and the intervener contend that the Court should:

–        dismiss the action;

–        order the applicant to pay the costs.

 Law

11      In support of its action, the applicant relies on three pleas in law, alleging (i) infringement of Article 76 of Regulation No 207/2009 (now Article 95 of Regulation 2017/1001); (ii) infringement of Article 7(1)(c) of Regulation No 207/2009; and (iii) breach of the principle of equal treatment.

 The second plea in law, alleging infringement of Article 7(1)(c) of Regulation No 207/2009

12      By its second plea, the applicant takes issue, in essence, with the Board of Appeal for having concluded — wrongly — that the contested mark was descriptive in relation to the goods in respect of which it had been registered.

13      Under Article 7(1)(c) of Regulation No 207/2009, trade marks which consist exclusively of signs or indications which may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods or of rendering of the service, or other characteristics of the goods or service are not to be registered. In addition, Article 7(2) of Regulation No 207/2009 states that paragraph 1 is to apply notwithstanding that the grounds of non-registrability obtain in only part of the European Union.

14      According to the case-law, Article 7(1)(c) of Regulation No 207/2009 prevents the signs or indications to which it refers from being reserved to one undertaking alone, in this instance, the applicant, because they have been registered as trade marks. The latter provision thus pursues an aim that is in the public interest, which requires that such signs and indications may be freely used by all (judgments of 23 October 2003, OHIM v Wrigley, C‑191/01 P, EU:C:2003:579, paragraph 31, and of 19 April 2016, Spirig Pharma v EUIPO (Daylong), T‑261/15, not published, EU:T:2016:220, paragraph 17).

15      Furthermore, signs or indications which may serve in trade to designate the characteristics of the goods or service in respect of which registration is sought are, by virtue of Article 7(1)(c) of Regulation No 207/2009, deemed incapable of performing the essential function of a trade mark, namely that of identifying the commercial origin of the goods or services at issue, in order thereby to enable the consumer who acquired the goods or services designated by the mark to choose to acquire them again if it was a positive experience, or to avoid doing so, if it was negative (judgments of 23 October 2003, OHIM v Wrigley, C‑191/01 P, EU:C:2003:579, paragraph 30, and of 19 April 2016, Daylong, T‑261/15, not published, EU:T:2016:220, paragraph 18).

16      It follows from this that, in order for a sign to be caught by the prohibition laid down by that provision, there must be a sufficiently direct and specific relationship between the sign and the goods or the services at issue to enable the relevant public immediately to perceive, without further thought, a description of the goods and services at issue or of one of their characteristics (see judgment of 19 April 2016, Daylong, T‑261/15, not published, EU:T:2016:220, paragraph 19 and the case-law cited).

17      If a mark which consists of a neologism or of a word produced by a combination of elements is to be regarded as descriptive for the purpose of Article 7(1)(c) of Regulation No 207/2009, it is not sufficient that each of its components may be found to be descriptive. The neologism or word itself must be found to be so (judgments of 12 January 2005, Wieland-Werke v OHIM (SnTEM, SnPUR, SnMIX), T‑367/02 to T‑369/02, EU:T:2005:3, paragraph 31, and of 19 April 2016, Daylong, T‑261/15, not published, EU:T:2016:220, paragraph 20; see also, by analogy, judgment of 12 February 2004, Campina Melkunie, C‑265/00, EU:C:2004:87, paragraph 37).

18      A trade mark consisting of a neologism or a word composed of elements each of which is descriptive of characteristics of the goods or services in respect of which registration is sought is itself descriptive of the characteristics of those goods or those services for the purpose of Article 7(1)(c) of Regulation No 207/2009 unless there is a perceptible difference between the neologism or the word and the mere sum of its parts. That presupposes that, because of the unusual nature of the combination in relation to the goods or services, the neologism or word creates an impression which is sufficiently far removed from that produced by the mere combination of meanings lent by the elements of which it is composed, with the result that the word is more than the sum of its parts. In that connection, analysis of the words at issue in the light of the appropriate lexical and grammatical rules is also relevant (see judgment of 19 April 2016, Daylong, T‑261/15, not published, EU:T:2016:220, paragraph 21 and the case-law cited).

19      It should also be borne in mind that the descriptiveness of a sign may only be assessed, first, in relation to the relevant public’s perception of it and, second, in relation to the goods or services concerned (judgments of 27 February 2002, Eurocool Logistik v OHIM (EUROCOOL), T‑34/00, EU:T:2002:41, paragraph 38, and of 19 April 2016, Daylong, T‑261/15, not published, EU:T:2016:220, paragraph 22). A sign must therefore be refused registration if at least one of its possible meanings designates a characteristic of the goods or services concerned (judgment of 23 October 2003, OHIM v Wrigley, C‑191/01 P, EU:C:2003:579, paragraph 32).

20      The plea in law alleging infringement of Article 7(1)(c) of Regulation No 207/2009 must be examined in the light of those considerations.

21      As regards the relevant public in the present case, it must be noted at the outset, as the Board of Appeal stated in paragraph 18 of the contested decision, that the goods covered by the contested mark are mostly clothing articles and their accessories and are directed at average consumers who are reasonably informed and reasonably observant, as well as at fashion professionals.

22      It must also be noted, as did the Board of Appeal, that the relevant public is composed of English-speaking consumers in the European Union, since the contested mark is composed of two words that have a meaning in English.

23      Next, the Court must examine whether there is, from the point of view of the relevant public, a sufficiently direct and specific relationship between one of the possible meanings of the contested mark and the goods in respect of which it was registered.

24      The applicant submits that the contested mark is a word mark comprising the expression ‘free style’ and that it cannot be considered to be exclusively composed of descriptive elements. It also states that neither the composition, nor the combination of the words ‘free’ and ‘style’ describes any of the goods in Classes 18 and 25. Last, it claims that, as the Cancellation Division confirmed, the words ‘free’ and ‘style’, by themselves and without further specification, do not refer, as such, to anything in particular, other than their literal meaning, that is a style that is free, a freedom of choice or improvisation applied to a particular domain, generally sport or art, and that the two words are too vague for the consumer to be able to make a connection between the words ‘free’ and ‘style’, on the one hand, and the goods in question, on the other.

25      In the first place, it must be noted, as did the Board of Appeal, that the contested mark is a word mark consisting of the expression ‘free style’ written in upper case.

26      In the second place, as regards the word ‘free’, it is well known that this term is common in English and, when used as an adjective, designates, for the English-speaking public, a way of doing something freely, without constraints or barriers.

27      In the third place, as regards the word ‘style’, this too is an extremely common English word, which the English-speaking public will associate with a form of appearance, a trend in relation to fashion and accessories in that field.

28      In the fourth place, the combination of the words ‘free’ and ‘style’ complies, as the Board of Appeal noted, with the lexical and grammatical rules of English, combining an adjective and a noun, and is immediately comprehensible for the English-speaking public, which will understand it as a specific concept, namely as ‘casual’.

29      In the case, first of all, of the goods in Class 18, the Board of Appeal considered that the relevant public would immediately understand that goods made of leather and imitations of leather are part of a casual style, a trend which is not bound by the prevailing rules of fashion. Likewise, according to the Board of Appeal, so far as concerns ‘leather’ and ‘imitations of leather’, consumers will believe that they are made or treated in a way that does not correspond to conventional methods, or that they will be used to make ‘casual-looking’ items that correspond to a fashion or style which is free from any convention. Finally, the Board of Appeal found that the contested mark was capable of designating more resistant and more comfortable goods that are intended to be used for sport or designed to be used in connection with ‘freestyle’ sports.

30      Accordingly, the Board of Appeal concluded that the contested mark was descriptive for all the goods in Class 18.

31      As regards the goods in Class 18, it must be held that the contested mark will immediately be associated by the public with items made of leather or imitations of leather that are manufactured in a specific style to confer on the person using them a casual style, or one that does not follow the prevailing rules of fashion.

32      Consequently, the Court must uphold the Board of Appeal’s finding that, in the case of goods made of leather and imitations of leather, the contested mark will immediately be perceived as being descriptive.

33      Next, in the case of the goods in Class 25, the Board of Appeal considered that the mark would immediately be perceived by consumers as designating a specific style, a casual style, a trend which is not bound by any prevailing rules of fashion. In addition, the Board of Appeal found that the contested mark would be understood as designating comfortable and resistant clothing, footwear and headgear which could be used for ‘freestyle’ sports.

34      Accordingly, the Board of Appeal concluded that the contested mark was descriptive for all the goods in Class 25.

35      As regards the latter goods, the same considerations apply as those expressed in relation to the goods in Class 18.

36      It must be held that the contested mark refers to the idea that the goods in Class 25 are manufactured or designed in a particular style which corresponds to a casual style, and that they may, in some circumstances, be used in sports which have a ‘freestyle’ version.

37      Consequently, the Court must uphold the Board of Appeal’s finding that, in the case of clothing, footwear and headgear, the contested mark will immediately be perceived as being descriptive.

38      Those findings of the Board of Appeal with regard to the goods in Classes 18 and 25 cannot be called into question by the applicant’s arguments.

39      First, the applicant submits that the contested mark is a word mark comprising the expression ‘free style’ and that it cannot be considered to be exclusively composed of descriptive elements, as neither the composition nor the combination of the words ‘free’ and ‘style’ describes any of the goods in Classes 18 and 25.

40      On that point, even on the assumption that the contested mark is composed of elements that are unrelated to its name or to the mere concept, it must be noted that those elements cannot divert the attention of the relevant public from the descriptive message delivered by that mark due to the combination of the words ‘free’ and ‘style’ which refers to a casual, spontaneous style, which does not follow the prevailing rules of fashion.

41      Consequently, the first argument cannot succeed.

42      Second, the applicant maintains that there is a very wide range of activities that have a ‘freestyle’ version, so that the words ‘free’ and ‘style’ are too vague for the consumer to be able to make a connection between those two words and the goods in question.

43      That second argument must also be rejected, in so far as the contested mark evokes fashion goods and accessories which are used by consumers to add another dimension to a particular style, that is a style that is trendy, unconventional, flouting the rules or the traditional canons of fashion.

44      It should be borne in mind in that regard that it is not necessary that the signs and indications composing a trade mark referred to in Article 7(1)(c) of Regulation No 207/2009 actually be in use in a way that is descriptive of the goods which they cover. It is sufficient, as the wording of that provision itself indicates, that such signs and indications could be used for such purposes (see judgment of 6 November 2007, RheinfelsQuellen H. Hövelmann v OHIM (VOM URSPRUNG HER VOLLKOMMEN), T‑28/06, EU:T:2007:330, paragraph 28 and the case-law cited).

45      Third, the applicant’s argument that the words ‘free’ and ‘style’ do not belong to the Spanish lexicon and cannot, therefore, be descriptive must be rejected since Article 7(2) of Regulation No 207/2009 makes clear that paragraph 1 of that article relating to absolute grounds for refusal is to apply notwithstanding that the grounds of non-registrability obtain in only part of the Union. Consequently, it is sufficient that the words ‘free’ and ‘style’ have been considered to be descriptive in Member States other than Spain.

46      It follows from all of the foregoing that the Board of Appeal did not err in law in concluding that the contested mark was descriptive in relation to the goods in Classes 18 and 25 for the purpose of Article 7(1)(c) of Regulation No 207/2009.

47      Accordingly, the second plea in law must be rejected as unfounded.

 The first plea in law, alleging infringement of Article 76 of Regulation No 207/2009

48      By its first plea, the applicant complains that the Board of Appeal — wrongly — took into account a number of documents which had been produced for the first time before it by the intervener, when the Board of Appeal should have declared them inadmissible.

49      Under Article 76(2) of Regulation No 207/2009 (now Article 95(2) of Regulation 2017/1001), EUIPO may disregard facts or evidence which are not submitted in due time by the parties concerned.

50      It follows from the wording of that provision that, as a general rule and unless otherwise specified, the submission of facts and evidence by the parties remains possible after the expiry of the time limits to which such submission is subject under the provisions of Regulation No 207/2009, and that EUIPO is in no way prohibited from taking account of facts and evidence which are submitted or produced late (judgments of 13 March 2007, OHIM v Kaul, C‑29/05 P, EU:C:2007:162, paragraph 42, and of 29 September 2011, New Yorker SHK Jeans v OHIM — Vallis K.-Vallis A. (FISHBONE), T‑415/09, not published, EU:T:2011:550, paragraphs 23 and 24).

51      In stating that EUIPO ‘may’, in such a case, decide to disregard evidence, that provision grants EUIPO a wide discretion to decide, while giving reasons for its decision in that regard, whether or not to take such evidence into account (judgment of 13 March 2007, OHIM v Kaul, C‑29/05 P, EU:C:2007:162, paragraph 43).

52      As regards the exercise of that discretion by EUIPO for the purpose of possibly taking into account evidence produced late, it should be noted that the Court has already ruled that, taking such evidence into account is particularly likely to be justified where EUIPO considers, first, that the material which has been produced late is, on the face of it, likely to be relevant and, second, that the stage of the proceedings at which that late submission takes place and the circumstances surrounding it do not militate against such matters being taken into account (judgment of 13 March 2007, OHIM v Kaul, C‑29/05 P, EU:C:2007:162, paragraph 44).

53      In the present case, it is apparent from paragraph 11 of the contested decision that the evidence was produced by the intervener for the first time before the Board of Appeal. The new material, which consisted of dictionary excerpts and extracts from the internet directly accessible to the public in several languages, supported, according to the intervener, the documents filed before the Cancellation Division and showed clothing, footwear, headgear and leather goods, including bags and jewellery, together with the word ‘freestyle’, as just one word, unlike the contested mark.

54      It must be noted in that regard that, first, it is not apparent from the contested decision that the Board of Appeal did in fact take account of the evidence which was produced for the first time before it, and, second, consideration of the contested decision in the context of the second plea has shown that it was not necessary to rely on that evidence to conclude that the contested mark was descriptive as regards the goods in Classes 18 and 25.

55      Accordingly, the first plea in law must be rejected as unfounded.

 The third plea in law, alleging breach of the principle of equal treatment

56      The applicant argues that its trade mark coexists with other EU trade marks and trade marks registered in other Member States including or directly comprising the words ‘free’ and ‘style’ which, although identical, are considered to be distinctive, and that the contested decision constitutes a breach of the principle of equal treatment.

57      The intervener and EUIPO dispute the applicant’s arguments.

58      It must be noted in that regard that, while the applicant relies on the existence of other EU trade marks and trade marks registered in other Member States consisting of the words ‘free’ and ‘style’, a number of those earlier marks do not cover the same classes of goods, and therefore most of those marks designate goods in respect of which there is no similarity.

59      Even if some of those earlier marks do concern goods of similar classes, it is sufficient to note that, according to settled case-law, decisions concerning registration of a sign as an EU trade mark which the Boards of Appeal are called on to take under Regulation No 207/2009 are adopted in the exercise of circumscribed powers and are not a matter of discretion. Accordingly, the question of whether a sign may be registered as an EU trade mark must be assessed solely on the basis of that regulation, as interpreted by the Courts of the European Union, and not on the basis of any previous practice of the Boards of Appeal (judgments of 15 September 2005, BioID v OHIM, C‑37/03 P, EU:C:2005:547, paragraph 47, and of 22 October 2015, Hewlett Packard Development Company v OHIM (ELITEPAD), T‑470/14, not published, EU:T:2015:795, paragraph 33).

60      Admittedly, it is clear from the case-law that EUIPO must, when examining an application for registration of an EU trade mark, take into account the decisions already taken in respect of similar applications and consider with especial care whether it should decide in the same way or not (judgment of 10 March 2011, Agencja Wydawnicza Technopol v OHIM, C‑51/10 P, EU:C:2011:139, paragraph 74). However, the way in which the principles of equal treatment and sound administration are applied must be consistent with respect for legality. Consequently, a person who files an application for, or challenges, registration of a sign as a trade mark cannot rely, to his advantage, on a possibly unlawful act committed to the benefit of someone else. Moreover, for reasons of legal certainty and, indeed, of sound administration, the examination of any application must be stringent and full, in order to prevent trade marks from being improperly registered. That examination must be undertaken in each individual case. The registration of a sign as a mark depends on specific criteria, which are applicable in the factual circumstances of the particular case and the purpose of which is to ascertain whether the sign at issue is caught by a ground for refusal (judgment of 10 March 2011, Agencja Wydawnicza Technopol v OHIM, C‑51/10 P, EU:C:2011:139, paragraphs 75 to 77).

61      In the present case, the Board of Appeal concluded, on the basis of a full examination and taking into account the perception of the relevant English-speaking public, that the mark applied for was descriptive and, therefore, not distinctive in relation to the goods at issue. That finding is sufficient in itself for it to be held that the registration of the contested mark as an EU trade mark is caught, so far as concerns the goods at issue, by the absolute ground for refusal set out in Article 7(1)(c) of Regulation No 207/2009.

62      It follows from this that the applicant cannot reasonably rely, for the purposes of casting doubt on the conclusion to which the Board of Appeal came in the contested decision, on EUIPO’s previous decisions (see, to that effect, judgment of 10 March 2011, Agencja Wydawnicza Technopol v OHIM, C‑51/10 P, EU:C:2011:139, paragraphs 78 and 79).

63      Accordingly, the third plea in law must be rejected as unfounded, and the action dismissed in its entirety.

 Costs

64      Under Article 134(1) of the Rules of Procedure of the General Court, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings.

65      Since the applicant has been unsuccessful, it must be ordered to pay the costs, in accordance with the forms of order sought by EUIPO and the intervener.

On those grounds,

THE GENERAL COURT (First Chamber)

hereby:

1.      Dismisses the action;

2.      Orders El Corte Inglés, SA, to pay the costs.

Delivered in open court in Luxembourg on 5 December 2017.

RegistrarPresident

*      Language of the case: English.

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