Branded promotional items do not use trade marks, says ECJ

Out-Law News | 20 Jan 2009 | 4:44 pm | 2 min. read

The use of a word or phrase in relation to free promotional items is not "genuine trade mark use" under EU laws, the European Court of Justice (ECJ) has said.

The court has ruled in a case involving a clothes maker that gave away soft drinks in a promotion. Clothing maker Maselli had registered trade marks for its brand, Wellness, for clothing and non-alcoholic drinks. To promote its clothes it gave away non-alcoholic drinks labelled with its brand.

Trade marks which are not used for five years can be revoked. Drinks company Silberquelle began an action to revoke Maselli's Wellness trade mark for drinks, claiming that the mark had not been used for five years. Maselli said that it had used the trade mark when it handed out the drinks carrying Wellness-Drink labels.

The ECJ has said that the handing out of free drinks labelled 'Wellness-Drink' was not "genuine use" of the Wellness trade mark in the drinks category. The EU's Directive on trade marks says that trade marks can be revoked after a five year period in which no "genuine use" of it was made.

"It is settled case-law that ‘genuine use’ within the meaning of the Directive must be understood to denote actual use, consistent with the essential function of a trade mark, which is to guarantee the identity of the origin of goods or services to the consumer or end user by enabling him, without any possibility of confusion, to distinguish the goods or services from others which have another origin," said the ECJ's ruling.

"It is essential, in the light of the number of marks that are registered and the conflicts that are likely to arise between them, to maintain the rights conferred by a mark for a given class of goods or services only where that mark has been used on the market for goods or services belonging to that class," said the ruling. "That condition is not fulfilled where promotional items are handed out as a reward for the purchase of other goods and to encourage the sale of the latter."

"In such a situation, those items are not at all distributed with the aim of penetrating the market for goods in the same class. Under those circumstances, affixing the mark to those items does not contribute to creating an outlet for those items or to distinguishing, in the interest of the customer, those items from the goods of other undertakings," it said.

"[The Directive] must be interpreted as meaning that, where the proprietor of a mark affixes that mark to items that it gives, free of charge, to purchasers of its goods, it does not make genuine use of that mark in respect of the class covering those items," said the ruling.

The judgment follows advice from one of the ECJ's advocates general, who said last November that the naming of the drink did not constitute trade mark use under the legislation. Ruiz-Jarabo Colomer said that because the recipient of the drink did not actually seek or request it, and because the drink was not engaging in acts of competition in the drinks market, the trade mark was not in "genuine use".