Tilda Riceland Private v OHMI - Siam Grains (BASMALI) (Community trade mark) [2012] EUECJ T-304/09 (18 January 2012)

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(Community trade mark - Opposition proceedings - Application for Community figurative mark BASmALI - Earlier non-registered trade mark and earlier sign BASMATI - Relative ground for refusal - Article 8(4) of Regulation (EC) No 40/94 (now Article 8(4) of Regulation (EC) No 207/2009))

1 On 4 November 2003, the intervener - Siam Grains Co. Ltd - filed an application for registration of a Community trade mark at 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 (replaced by Council Regulation (EC) No 207/2009 of 26 February 2009 on the Community trade mark (OJ 2009 L 78, p. 1)).

2 The trade mark in respect of which registration was sought is the following figurative sign:

3 The goods in respect of which registration was sought fall within Class 30 of the Nice Agreement concerning the International Classification of Goods and Services for the Purposes of Registration of Marks of 15 June 1957, as revised and amended, and correspond to the following description: 'long rice'.

4 The Community trade mark application was published in Community Trade Marks Bulletin No 37/2004 of 13 September 2004.

5 On 10 December 2004, United Riceland Private Ltd (now Tilda Riceland Private Ltd; 'Tilda Riceland Private' or 'the applicant') filed a notice of opposition under Article 42 of Regulation No 40/94 (now Article 41 of Regulation No 207/2009) to registration of the trade mark applied for in respect of the goods referred to in paragraph 3 above.

6 The opposition was based on the earlier non-registered trade mark or the earlier sign BASMATI, used in the course of trade in relation to rice.

7 The ground relied on in support of the opposition was that referred to in Article 8(4) of Regulation No 40/94 (now Article 8(4) of Regulation No 207/2009). Tilda Riceland Private claimed, in particular, that it was entitled under the applicable law in the United Kingdom to prevent, by means of an action for passing off, use of the trade mark applied for.

8 On 28 January 2008, the Opposition Division rejected the opposition in its entirety. It found, in particular, that Tilda Riceland Private had failed to submit documents describing how the rice which that company exports to the United Kingdom is marketed. Accordingly, Tilda Riceland Private had failed to prove that it had acquired the 'goodwill' necessary to succeed under the law of passing off in the United Kingdom.

9 On 20 March 2008, Tilda Riceland Private filed a notice of appeal with OHIM, under Articles 57 to 62 of Regulation No 40/94 (now Articles 58 to 64 of Regulation No 207/2009), against the decision of the Opposition Division.

10 By decision of 19 March 2009 ('the contested decision'), the First Board of Appeal of OHIM dismissed the appeal. In essence, it found that, under Article 8(4) of Regulation No 40/94, the opponent had to show that it was the proprietor of the right on which the opposition was based. In the case before it, however, Tilda Riceland Private had not shown that it was the proprietor of the right relied on. In particular, the Board of Appeal found that the term 'basmati' was not a trade mark or sign covered by proprietary rights, but simply the common designation of a variety of rice. The term 'basmati' is generic. Furthermore, the Board of Appeal pointed out that the property protected by an action for passing off does not relate to the sign at issue but to the 'goodwill'. The Board of Appeal concluded that Tilda Riceland Private had failed to show that it had ownership of the term 'basmati' and that, accordingly, the opposition did not fulfil the condition, provided for in Regulation No 40/94, relating to the existence of a proprietary right.

13 The applicant puts forward in essence a single plea in law, alleging infringement of Article 8(4) of Regulation No 40/94, which is composed of four complaints: (i) on the basis of a purely literal reading of Article 8(4) of Regulation No 40/94, the Board of Appeal wrongly attempted to impose a 'Community concept of "proprietorship" 'of the earlier mark or sign relied on; (ii) the Board of Appeal erred in making a distinction between the 'extended' form of passing off in the United Kingdom, upon which the opposition was based, and Article 8(4) of Regulation No 40/94, which - according to the Board of Appeal - must refer to an exclusive right held by a single trader; (iii) the Board of Appeal erred in requiring that the opponent show ownership of the earlier sign in addition to showing ownership of an intangible right; and (iv) the Board of Appeal erred in finding that the term 'basmati' is generic.

14 OHIM maintains, in respect of the first and fourth complaints raised by the applicant, that the signs covered by Article 8(4) of Regulation No 40/94 must satisfy 'uniform European criteria'. The Board of Appeal rightly found that the term 'basmati' used in relation to rice does not constitute a right for the purposes of Article 8(4) of Regulation No 40/94. That being so, it was not necessary to apply the national law invoked in support of the opposition. In particular, the sign BASMATI is not capable of performing the essential function of a trade mark, which is to identify the origin of the goods to which it refers. In respect of the second and third complaints raised by the applicant, OHIM states that, in finding that the term 'basmati' does not constitute a right for the purposes of Article 8(4) of Regulation No 40/94, the Board of Appeal was justified in dismissing the appeal on the basis of that finding, without there being any need to examine the requirements of national law.

15 The intervener submits that the condition that the opponent must be the proprietor of the sign constitutes an 'independent requirement' which must be interpreted independently of the requirements under national law. It maintains that its interpretation of Article 8(4) of Regulation No 40/94 does not preclude opposition proceedings based on the action for passing off in so far as the opponent relies on a sign of which it is the sole user in the market and which enables it, owing to the reputation which that sign has acquired with the opponent's customers, to distinguish its products or activities from those of other undertakings. Lastly, the intervener argues that the sign BASMATI is the generic designation for a type of rice and does not constitute a sign capable of distinguishing the products of one undertaking from those of others. In those circumstances, the Board of Appeal simply inferred from the generic nature of the sign BASMATI that the applicant was not the 'proprietor' of that sign.

16 In accordance with Article 8(4) of Regulation No 40/94, the proprietor of a non-registered trade mark or of another sign used in the course of trade of more than merely local significance can lodge a statement of opposition against the registration of a Community trade mark where and to the extent that, pursuant to the law of the Member State which is applicable, rights to that sign were acquired prior to the date of application for registration of the Community trade mark, or prior to the date of the priority claimed for the application for registration of the Community trade mark, and that sign confers on its proprietor the right to prohibit the use of a subsequent trade mark.

17 It follows that one of the conditions for applying Article 8(4) of Regulation No 40/94 is that the opponent has to show that it is the proprietor of the sign relied on in support of the opposition. That condition means that the opponent has to prove the acquisition of rights over that sign (see, to that effect, Case T-137/08 BCS v OHIM - Deere (Combination of the colours green and yellow) [2009] ECR II-4047, paragraph 73, and Case T-255/08 Montero Padilla v OHIM - Padilla Requena (JOSE PADILLA) [2010] ECR II-0000, paragraph 63). Under Article 8(4) of Regulation No 40/94, those rights must make it possible to prohibit the use of a subsequent trade mark.

18 Furthermore, to the extent that the applicant relies in support of its opposition on the action for passing off, provided for under the law of the United Kingdom, it should be noted that the law of the Member State which is applicable in the present case is the Trade Marks Act 1994, section 5(4) of which provides, inter alia:

19 It follows from that provision, as interpreted by the national courts, that the opponent must establish, in accordance with the legal rules governing actions for passing off, as laid down by the laws of the United Kingdom, that three conditions are satisfied: the goodwill acquired (that is to say, the attractive force which brings in custom), misrepresentation and damage caused to that goodwill (see, to that effect, Case T-303/08 Tresplain Investments v OHIM - Hoo Hing (Golden Elephant Brand) [2010] ECR II-0000, paragraphs 93 and 101, and the decisions of the national courts referred to).

20 In the present case, it is clear from the contested decision that the Board of Appeal rejected the opposition on the sole ground that the applicant had not proved that it was proprietor of the sign relied on in support of the opposition. The Board of Appeal accordingly stated that '[t]he appeal [was] not well founded'; that '[t]he opponent [was] not the proprietor of the sign upon which it filed the opposition'; and that '[t]he reasons follow[ed]' (paragraph 14 of the contested decision). That reasoning led the Board of Appeal to conclude that, 'since the opponent did not substantiate its claim of ownership on the ["]Basmati["] name, the opposition [was] not well founded pursuant to Article 8(4) [of Regulation No 40/94] and [that] the appeal [had to] be dismissed' (paragraph 29 of the contested decision). In order to reach that conclusion, the Board of Appeal held that the sign in question was not a trade mark because, inter alia, it was generic and that the 'ownership' claimed by the applicant related only to the goodwill. The Board of Appeal did not, however, reject the opposition on the ground that the sign in itself could not serve as the basis for an opposition in accordance with Article 8(4) of Regulation No 40/94. In particular, it does not emerge from the contested decision that the Board of Appeal held that the term 'basmati' used in relation to rice '[did] not constitute a right within the meaning of Article 8(4) of [Regulation No 40/94]', as OHIM states in its written pleadings. The arguments submitted by OHIM and by the intervener, seeking to claim that the sign in question did not fall within the scope of Article 8(4) of Regulation No 40/94, are therefore ineffective.

21 First, although the contested decision is ambiguous in that respect, the Board of Appeal seems to have held that the applicant had to prove that it formally possessed the 'ownership' of the sign relied on in support of the opposition. However, as was pointed out in paragraph 17 above, the requirement that the opponent be the proprietor of the sign relied on involves proving the acquisition of rights over that sign. Article 8(4) of Regulation No 40/94 does not specify the form which the acquisition of such rights ought to take. The seemingly restrictive approach adopted by the Board of Appeal is in contradiction, however, with the fact - mentioned by OHIM in its written pleadings before the Court - that the signs referred to in Article 8(4) of Regulation No 40/94 are most often based on use rather than registration.

22 Secondly, it must be held that the question whether an opponent has acquired rights over a non-registered trade mark or over a sign used in the course of trade - and, accordingly, whether he is proprietor of the sign relied on for the purposes of Article 8(4) of Regulation No 40/94 - cannot be addressed without taking into account the national law invoked in support of the opposition. In that context, one of the roles played by the relevant national law is to define the procedures for acquiring rights over the sign relied on in support of an opposition brought under Article 8(4) of Regulation No 40/94.

23 Indeed, in paragraph 24 of the contested decision, the Board of Appeal itself expressly referred to national law in order to hold that the property linked to the action of passing off related only to goodwill. Furthermore, it should be pointed out that, in an annex to the Guidelines relating to proceedings before OHIM, OHIM published - in relation to Part 4, entitled 'Rights under Article 8(4) [of Regulation No 40/94]', of Part C of those guidelines, entitled 'Opposition' - a list of '[n]ational rights which constitute "earlier rights" in the sense of Article 8(4) [of Regulation No 40/94]'. That annex specifies the nature of the 'national rights' concerned, as well as the procedures for their acquisition. In the case of the United Kingdom, it therefore covers non-registered trade marks and signs used in the course of trade 'protected by any rule of law, including that of passing off'.

24 The arguments of OHIM relating to Article 52(2) of Regulation No 40/94 (now Article 53(2) of Regulation No 207/2009) cannot alter that conclusion. Assuming that, as claimed by OHIM, not all the earlier rights can be invoked within the context of Article 8(4) of Regulation No 40/94, that does not necessarily mean that the sign in question is excluded a priori from the signs falling within the scope of that provision - a position which the Board of Appeal did not adopt; nor does it mean that the national law is irrelevant in the present case for determining the procedures for acquiring rights over the sign relied on.

25 Thirdly, it should be noted that section 5(4) of the Trade Marks Act 1994 also states, in the second subparagraph, that a person entitled to prevent the use of a trade mark must be regarded as being the 'proprietor of an earlier right'. It follows that, under the law which is applicable in the United Kingdom, within the context of an action for passing off, the status of proprietor of an earlier right cannot be defined independently - as the Board of Appeal essentially did in the contested decision - without account being taken of the opponent's ability to prevent the use of a trade mark.

26 The fact that the property protected by an action for passing off does not relate to a word, or to a name, which third parties are restrained from using, but rather to the very customer base which is undermined by the usage in question (Joined Cases T-114/07 and T-115/07 Last Minute Network v OHIM - Last Minute Tour (LAST MINUTE TOUR) [2009] ECR II-1919, paragraph 61) - as the Board of Appeal essentially stated in paragraph 24 of the contested decision - cannot alter that conclusion. The fact that the opponent is formally the proprietor only of the customer base which is undermined does not necessarily mean that it has not acquired rights over the sign relied on, rights which enable it to prevent, should the case arise, the use of a subsequent trade mark. In that respect, it should be pointed out that, within the context of an action for passing off, it is the sign used to designate goods or services which acquires a reputation on the market (see, to that effect, LAST MINUTE TOUR, paragraph 84). In addition, it is the use of the sign concerned which enables a natural or legal person to be 'proprietor of an earlier right' within the meaning of the law which is applicable in the United Kingdom.

27 As regards the fact, mentioned by the intervener in response to a written question from the Court, that the second subparagraph of section 5(4) of the Trade Marks Act 1994 was not invoked by the applicant in its written pleadings before the Court, it need only be pointed out that the action for passing off provided for under the law of the United Kingdom served as the basis for the opposition lodged by the applicant before OHIM. Accordingly, the law applicable in the United Kingdom was an integral part of the dispute before the Board of Appeal. It therefore forms part of the factual and legal context in the light of which the Court must carry out its review.

28 Fourthly, the fact that - as the Board of Appeal points out in paragraph 19 of the contested decision - in the grounds supporting its opposition, the applicant used the term 'trade mark' to refer to the sign relied on, apart from the fact that this can result from a non-registered trade mark being invoked in support of the opposition, cannot detract from the fact that the opposition was based, inter alia, on a sign used in the course of trade. Moreover, the Board of Appeal referred to that ground of opposition in paragraph 16 of the contested decision. In those circumstances, it must be held that the fact relied on by the Board of Appeal, according to which the sign BASMATI is not a trade mark, does not nevertheless mean that the applicant had not acquired rights over that sign for the purposes of Article 8(4) of Regulation No 40/94, read in the light of the national law which is applicable in the present case. More specifically, as regards the assertion made by the Board of Appeal to the effect that the term 'basmati' is generic, it follows from national case-law that a sign used to designate goods or services may have acquired a reputation on the market for the purposes of the law applicable to an action for passing off, even though it originally had a descriptive character or is devoid of distinctive character (see LAST MINUTE TOUR, paragraph 26 above, paragraph 84). It also follows from national case-law that a sign used to designate goods or services may have acquired a reputation on the market for the purposes of the law applicable to an action for passing off, even though it is used by several traders in the course of business (Chocosuisse Union des fabricants suisses de chocolat & Ors v Cadbury Ltd. [1999] EWCA Civ 856). That 'extended' form of the action for passing off, recognised by national case-law, accordingly enables several traders to have rights over a sign which has acquired a reputation on the market. The fact relied on by the Board of Appeal - assuming it to be proved - is not therefore capable, in the light of the national law applicable, of casting doubt on the fact that the opponent may have acquired rights over the sign relied upon.

29 It follows from all the foregoing that the Board of Appeal erred in rejecting the opposition on the ground that the applicant had not proved that it was proprietor of the sign in question, without analysing specifically whether the applicant had acquired rights over that sign in accordance with the law of the United Kingdom.

30 In those circumstances, the single plea raised by the applicant must be upheld and the contested decision annulled.

31 Under Article 87(2) 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. Where there are several unsuccessful parties, the Court is to decide how the costs are to be shared.

32 In the present case, OHIM and the intervener have been unsuccessful. In addition, the applicant applied for OHIM and the intervener to be ordered to pay the costs.

33 In consequence, OHIM must be ordered to pay, in addition to its own costs, two thirds of the applicant's costs and the intervener must be ordered to pay, in addition to its own costs, one third of the applicant's costs.

1. Annuls the decision of the First Board of Appeal of the Office for Harmonisation in the Internal Market (Trade Marks and Designs) (OHIM) of 19 March 2009 (Case R 513/2008-1);

2. Orders OHIM to bear its own costs and to pay two thirds of the costs incurred by Tilda Riceland Private Ltd;

3. Orders Siam Grains Co. Ltd to bear its own costs and to pay one third of the costs incurred by Tilda Riceland Private Ltd.

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You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Tilda Riceland Private v OHMI - Siam Grains (BASMALI) (Community trade mark) [2012] EUECJ T-304/09 (18 January 2012) URL: http://www.bailii.org/eu/cases/EUECJ/2012/T30409.html Cite as: [2012] EUECJ T-304/9, [2012] EUECJ T-304/09

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