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General Court: incorrect ground need not lead to annulment of measure

01/03/2019

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United Kingdom

This article looks at the EU General Court's decision in Turbo-K International v European Union Intellectual Property (EUIPO) (Case T-671/17, 17 January 2019) concerning a successful opposition to...

This article first appeared on World Trademark Review in January 2019.  For further information please go to www.worldtrademarkreview.com

  • Turbo-K Ltd opposed registration of TURBO-K by Turbo-K International Ltd based on unregistered mark TURBO-K

  • EUIPO refused registration of mark based on unregistered UK rights

  • Court found that, although Board of Appeal erred in confusing Turbo-K (UK) for Turbo-K Ltd, this did not affect legality of its decision

In Turbo-K International v European Union Intellectual Property Office (EUIPO) (Case T-671/17, 17 January 2019), the General Court has upheld the decision of the Second Board of Appeal of the EUIPO refusing registration in the European Union of the trademark TURBO-K in the name of Turbo-K International Ltd for the core goods on the basis of unregistered UK rights in the TURBO-K mark owned by Turbo-K Ltd.

Background

In 2014 Turbo-K International Ltd applied to register the word mark TURBO-K in the European Union in Classes 1, 3, and 35. Turbo-K Ltd asserted unregistered rights acquired through use in both the word mark TURBO-K and the stylised mark depicted below in the United Kingdom and the Netherlands:

Turbo-K Ltd opposed under Article 8(4) of Regulation 207/2009 (now Regulation 2017/1001).  Article 8(4) provides that a mark shall not be registered as an EU trademark (EUTM) where a third party is able to evidence prior rights in a non-registered trademark of more than mere local significance which would provide them with the right to prohibit the use of a subsequent trademark. In the United Kingdom, this right is provided under the law of passing off.

Turbo-K International Ltd argued in defence that Turbo-K Ltd was merely one of several distributors and that the TURBO-K mark was actually owned by a third party, Lach Dennis Consultants. It filed copies of various contractual agreements as evidence in support of this claim.

Opposition Division decision

The Opposition Division upheld the opposition in part, refusing registration for the core goods.

The Opposition Division held that Turbo-K Ltd had established use of the earlier marks in the United Kingdom for a gas turbine compressor cleaner. The Opposition Division went on to hold that the passing-off trinity (goodwill, misrepresentation and damage) had also been established. However, the opposition did not succeed on the basis of unregistered rights in the Netherlands, as the Opposition Division considered that Turbo-K Ltd had not submitted sufficient evidence as to the relevant Dutch law.

The Opposition Division held that the contractual agreements filed in evidence by Turbo-K International Ltd did not call into question the acquisition of goodwill by Turbo-K Ltd because they related to the product formulation and did not refer to the TURBO-K mark at all. It was common ground that Turbo-K Ltd had long marketed the TURBO-K branded product in the United Kingdom.

Board of Appeal Decision

Turbo-K International Ltd appealed and was successful in respect of certain goods that the Board of Appeal considered dissimilar to the goods Turbo-K Ltd had established rights in the TURBO-K mark for. The Board of Appeal agreed with the Opposition Division's interpretation of the contractual agreements as referring to the product formula only. The Board of Appeal considered it was unnecessary, for reasons of procedural economy, to address Turbo-K Ltd's cross-appeal argument that the opposition should also succeed on the basis of unregistered Dutch rights.

General Court decision

Both parties appealed, Turbo-K International Ltd on the basis that the Board of Appeal had not properly considered the contracts it had filed in evidence, and had mistaken a third party mentioned in those contracts (Turbo-K (UK)) for Turbo-K Ltd. Turbo-K Ltd appealed on the basis that the Board of Appeal had erred in not examining its claim in relation to the Netherlands, in particular because Turbo-K International Ltd might convert its EUTM application to a Dutch national application. The General Court upheld the Board of Appeal's decision in its entirety.

Turbo-K International Ltd's claims were rejected on the basis that the contracts it had filed in evidence did not support its claims. The claim that Lach Dennis Consultants owned the TURBO-K name was unsupported by the evidence, which merely showed that Lach Dennis Consultants owned the product formulation. While it was true that the Board of Appeal had erred in confusing Turbo-K (UK) for Turbo-K Ltd, this did not affect the legality of the contested decision. The court referred to case-law providing that "an incorrect ground need not lead to annulment of the measure thereby vitiated if it is superfluous and there are other grounds which provide a basis for that measure" (Paragraph 39).

Turbo-K Ltd's appeal was rejected as inadmissible because, were the opposition to succeed based on use in the Netherlands, such success would be at most to the same extent as it had succeeded based on use in the United Kingdom and, therefore, the cross-claim could not procure any actual advantage for Turbo-K Ltd. The claim was based on a hypothetical "future and uncertain legal situation" (Paragraph 98).

Conclusion

The key takeaways from this case are the following:

  • A clear error will not necessarily result in annulment of a measure where it is superfluous and there are other grounds which provide a basis for that measure; and

  • EU courts are unlikely to look fondly on unnecessary appeals from successful parties arguing they should have succeeded on more grounds.

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