Are you ready to boost your EU trademark portfolio? You will only have one chance

There has been recent flurry of attention to the proposed Article 28 declaration in connection with the scope of protection for goods and services of Community Trade Marks (to become known as European Union Trademarks).

Former Guest Kat Darren Meale, of Simmons & Simmons in London, has done some hard initial thinking on this and he shares his thoughts with Kat readers.

“This one is about Community trade marks (CTMs). If you have a portfolio of CTMs – or even just one – filed before 22 June 2012 and have never heard of an Article 28 declaration, you should read this. Trade mark owners will soon be given a six-month, one-off window to bolster the scope of their pre-June 2012 CTM portfolios by making an “Article 28” declaration to the EU Intellectual Property Office (as OHIM will soon be known) regarding the goods and services covered by their registrations. If they do not, those registrations may forever thereafter be limited and no longer cover goods and services which owners previously thought they did.

What is the EUIPO doing to CTM portfolios?

As widely known, in 2012, the Court of Justice of the EU gave a decision in Case C-307/10 IP Translator. In short, the fallout from that decision led to a change in the way OHIM interprets the scope of the monopoly claimed by a CTM where that CTM uses what are called the “class headings” of the Nice Classification. Prior to 2012, CTM applicants and their advisors often used class headings as an abbreviated way of claiming a broad monopoly. So, as but one example, specifying “musical instruments” under Class 15 would then be taken by OHIM to mean that the CTM covers all of the possible goods in that class under the Nice Classification, including all types of musical instruments and their accessories.

As of this year, the rebranded EUIPO will no longer take that approach as a result of changes brought in by Article 28 of the new EU trade mark regulation (EUTMR). Instead, it will confine CTMs that contain class headings to the literal meaning of the words in the class heading. If a product or service is not included in the literal meaning of those words (in the opinion of the EUIPO), the CTM will not cover that product or service. So, for example, a CTM for “musical instruments” would previously have covered tuning forks and conductors’ batons, but will no longer. It is quite likely that this change in law and practice will be permanent.

Why should anyone care?

Although the ins and outs of trade mark specifications might be seen by some to be a dull, technical aspect of a trade mark portfolio, they are fundamental to the scope of protection a registered trade mark actually gives. As one always explains to trade mark novices, saying that you have a trade mark for, say, KODAK is only half the story. What does your trade mark cover? And so we look at the specification, which might contain 10s or even hundreds of different goods and services, meaning that in practice the owner has 10s or even hundreds of different trade mark monopolies. The change in law and practice is going to delete some of those. It is going to take away some trade mark rights – probably forever. So doing nothing is a bad idea. The question is: what should CTM owners do?

Option 1: The Article 28 declaration

In recognition of the fact that the EUTMR approach to interpreting class heading claims in specifications should apply retrospectively as well as prospectively, it also provides that owners of marks which pre-date IP Translator will have an opportunity to revisit the specifications of their marks.

To effect this, the EUIPO is opening a one-off, time-limited window between 23 March and 23 September of this year in which CTM owners can file a declaration setting out additional goods and services not covered by the literal meaning of class headings used in their registrations. This will only be available for CTMs which specify the class heading which was in place at the time the CTM was filed (i.e., between 1 April 1996 and 21 June 2012). Those additional goods and services will then be added to the specifications of those registrations and bolster the future protection provided by them. If no declaration is filed, the effect will be that all relevant marks will be automatically limited to cover only the literal meaning of the words in the class heading.

As ever, the devil is in the detail. Less than two weeks before Christmas, OHIM produced a draft Communication of the President explaining how it would put Article 28 declarations into effect. It only gave until 4 January for interested parties to reply. The draft Communication was sent out on a confidential basis to user groups. This guest Kat is a good kitty so will respect that confidentiality – several law and attorney firms have not (no names will be mentioned!). For that reason, I do not go into the specifics of that draft Communication, but will make some general mentions below. It is hoped that the final Communication will be issued as soon as possible, so us lawyers and trade mark attorneys can properly advise our clients on the process. Remember that for now, if you see a press release from an advisor on the Communication, it will be based on a draft which is subject to change. And key bits of it have been subject to significant comments by organisations including WIPO, MARQUES and others.

Option 2: The Article 50 part-surrender

It is always open to CTM owners to surrender part of their trade mark by deleting particular goods and services from a specification. This power can be utilised where the specification covers an entire class heading to delete that heading and replace it with the full alphabetical list of goods and services listed in the relevant Nice Classification for that class, less one type of good or service (as otherwise nothing has been surrendered – you are bound to find something you’re not too fussed about, perhaps particle accelerators in Class 9). If there might have been doubts as to whether a good or service was covered by the literal meaning of the words in the class heading, this method, like an Article 28 declaration, can overcome the doubt by expressly specifying the good or service in question.

So which one is the best option?

Both methods achieve, in different way, a similar outcome – the aim of which is to ensure that CTMs remain registered for as broad a scope of goods and services in possible, and are not negatively affected by the change in the law. Although those who have jumped the gun and published information on the draft Communication have made recommendations on which way to go, in this Guest Kat’s view that is premature. There are still big questions to be answered and until the EUIPO does that, no decision should or needs to be taken. Again without revealing anything specific from the draft Communication, there are a few points we should bear in mind before we can come to a firm view on this matter:

1. Neither approach requires payment of an official fee.

2. Additional goods and services added by an Article 28 declaration will be subject to certain defences if CTM owners try to assert their marks against third parties who have made prior uses, i.e., if your declaration broadens your monopoly you cannot assert it against a use which predates the declaration. See Article 28(9) of the new EUTMR.

3. It would not appear that these defences apply to partial surrenders. This Guest Kat is aware that one international law firm has stated otherwise, and in particular that the defences will apply to any partial surrender filed after the new EUTMR comes into force – but he cannot see on what basis this conclusion has been reached. He would be happy to be enlightened!

4. Article 28 declarations involve retaining the class heading and adding additional goods and services, albeit we anticipate that the EUIPO will look to keep the possible additions to a narrow list. Partial surrenders involve deleting the class heading and replacing it with a (very) long list of goods and services.

5. Either approach could create new arguments in any non-use attack on a mark. Whilst it could be useful in some circumstances, a partial surrender may also be more likely to create a list of goods and services which is more vulnerable in any non-use revocation action, because a long list of goods and services is, in this Guest Kat’s view, easier for a court or the EUIPO to cross through and limit down to only the precise goods for which use can be proved, whereas this is perhaps harder to do where class heading wording remains in place. Taking our musical instruments example again, a CTM owner who only sells trombones under the mark may keep “musical instruments” or “brass instruments”, but is unlikely to keep a specified list that includes violins, clarinets or tubas. There are more. It shouldn’t come as a surprise that this is turning into a complicated mess – the change in the law is seeking to re-write history in relation to 16 years’ worth of CTMs, which is something in the region

of 660,000 current registrations.

Why not just decide on a mark-per-mark basis?

Ideally, an advisor will sit down with her client and go through her CTMs mark by mark, class by class, work out which cover entire class headings, work out what goods or services might not be covered by the literal meaning of the words of that class heading but otherwise need to be in there, and then file bespoke declarations for each CTM. But it is worth bearing in mind that portfolios of 100, 200 or even 500 CTMs are not uncommon. Doing the bespoke job for portfolios of that size is a huge job – one that is either going to take a lot of the owner’s time (if it has in-house trade mark expertise) or cost it a small fortune (if it goes to solicitors or trade mark attorneys).

In this Guest Kat’s view, a standard approach needs to be adopted across a portfolio which seeks to broaden and/or maintain the monopoly provided by that portfolio in the most time and cost effective way possible. We don’t yet have all the information to hand to draw a firm conclusion as to what the approach should be – although if this post were to generate some debate on that subject, that would be excellent."