PAGO: is Austria "substantial"?

This morning in the Court of Justice of the European Communities Advocate General Eleanor Sharpston QC delivered her Opinion in Case C‑301/07 PAGO International GmbH v Tirol Milch registrierte Genossenschaft mbH, this being a reference for a preliminary ruling from the Oberster Gerichtshof, Austria.  PAGO owns a Community trade mark for, inter alia, fruit drinks and fruit juices. This mark includes a representation of a green glass bottle which Pago had used for a number of years in marketing, plus a distinctive label and cap next to a full glass of fruit drink identified in large characters, known as ‘PAGO’. sold in Austria a fruit and whey drink called ‘Lattella’, packaged in glass bottles the design of which resembled in several respects (shape, colour, label, cap) that depicted in Pago’s Community trade mark. In the advertising for its drink Tirol Milch used a representation which, like Pago’s Community trade mark, shows a bottle next to a full glass. 

It was accepted that there was no likelihood of confusion, since the bottle labels bore the names ‘Pago’ and ‘Latella’ respectively, both being widely known in Austria; the parties proceeded on the basis that the conditions of Article 9(1)(c) of Community Trade Mark Regulation 40/94 (infringement of "any sign which is identical with or similar to the Community trade mark in relation to goods or services which are not similar to those for which the Community trade mark is registered, where the latter has a reputation in the Community and where use of that sign without due cause takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the Community trade mark") had been met in that (i) Tirol's sign was similar or identical to that for which Pago owned the Community trade mark, and (ii) the drink marketed by Tirol was not considered to be similar to that marketed by Pago.

Pago sought an injunction before the Commercial Court, Vienna, to stop Tirol infringing its trade mark by (i) promoting, offering for sale, marketing or otherwise using its drink in the bottles at issue, and (ii) advertising a representation of the bottles together with a full glass. That court granted the injunction but its decision was reversed by the Higher Regional Court, Vienna. Pago then appealed to the Oberster Gerichtshof, which referred the following questions for a preliminary ruling:

‘(1) Is a Community trade mark protected in the whole of the Community as a “trade mark with a reputation” for the purposes of Article 9(1)(c) of the Regulation if it has a “reputation” only in one Member State?

(2) If the answer to the first question is in the negative: is a mark which has a “reputation” only in one Member State protected in that Member State under Article 9(1)(c) of the Regulation, so that a prohibition limited to that Member State may be issued?’

The recommendation of the Advocate General is should be answered as follows:

"(1) A Community trade mark is protected in the whole of the Community on the ground that it has a ‘reputation in the Community’ within the meaning of Article 9(1)(c) ...  if it has a reputation in a substantial part of the Community. What constitutes a substantial part of the Community for that purpose is not dependent on national boundaries but must be determined by an assessment of all the relevant circumstances of the case, taking account, in particular, of (i) the public concerned by the products or services covered by the trade mark and the proportion of that public which knows of the mark and (ii) the importance of the area in which the reputation exists, as defined by factors such as its geographical extent, population and economic significance.

(2) A Community trade mark which has a reputation in an area which is not a substantial part of the Community in that sense does not enjoy, under Article 9(1)(c) of Regulation No 40/94, protection limited to that area. Consequently, a prohibition against infringement limited to that area may not be issued".

Of note is the Advocate General's review of the Court's earlier jurisprudence in General Motors and Nieto Nuño:

"30. It is first necessary to establish whether the trade mark has a ‘reputation’. In order to do so, the national court must identify the public concerned by the trade mark in the context of the Community as a whole, without regard to Member States’ borders. Having identified the relevant public, the national court should proceed to determine whether the reputation exists amongst a significant part of the public concerned by the goods or services covered by the trade mark.

31. The national court must then determine whether the trade mark has a reputation ‘in the Community’. It should begin by accepting that the trade mark proprietor need not demonstrate that the trade mark has a reputation throughout the Community. It is sufficient, for Article 9(1)(c) to apply, if the trade mark has a reputation in a ‘substantial part’ of the Community. General Motors does not provide further guidance as to how a ‘substantial part’ of the relevant territory is to be construed.

32. The Court’s case-law does, however, indicate what is not a ‘substantial part’. In Nieto Nuño it was established in relation to the kindred concept of whether a trade mark is ‘well known’ under Article 4(2)(d) of the Directive that the city of Tarragona and its surrounding area within Spain is not a substantial part of that Member State. Applying the same reasoning by analogy to the concept of a ‘substantial part of the Community’, it follows that where the ‘part’ is, viewed objectively by reference to its size and economic weight, paltry in comparison with the Community as a whole and where the relevant public is more widely spread throughout the Community, that part cannot be deemed to constitute a ‘substantial part’ of the Community. That conclusion follows from the ordinary meaning of the term ‘substantial’. It also accords with common sense.

33. The scenarios that may be envisaged are many and various. At one end of the spectrum, a trade mark covering a generic product marketed to the general public which enjoyed a significant reputation amongst that public would be expected to be known throughout a wide geographical area before it could be said to enjoy a ‘reputation in the Community’. At the other extreme, a trade mark for a particular product marketed to a specialised regional public would be expected to be known over a much smaller area. A product that is marketed to a professional public might well cover a wide area (depending on how widespread membership of that profession was) but would probably be known to a smaller number of people, in absolute terms, than a product marketed to the general public.

34. As with the concept of relevant public, the territorial aspect of ‘reputation’ cannot be defined by reference to an abstract figure or a particular number of Member States. The national court will have to evaluate a number of factors to determine whether a particular trade mark enjoys a reputation in a substantial part of the Community. Such factors will include, but not be limited to, the economic significance of the territory within the Community, the geographical extent of the area where the trade mark has a reputation and the demographics of the public concerned.

35. In order to determine whether an earlier trade mark enjoys a reputation in a substantial part of the Community for the purposes of Article 9(1)(c) of the Regulation, the national court must therefore make an overall assessment of the case in conjunction with establishing the public amongst whom that earlier trade mark is known. Any such test must necessarily be flexible".

The IPKat doesn't feel there's anything hugely controversial here. It's simply a reminder to make overall assessments that don't obviously clash with ECJ case law. Merpel says, this is what I've been waiting for -- an appraisal of "substantial part of the Community" that looks at reality instead of national boundaries. On this basis, Luxembourg on its own stands little chance of being a "substantial part" ...

Early comment here from Fabio Angelini ("Catch Us If You Can !!!") here