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TRADEMARKS ANDUNFAIR COMPETITION

K&L Gates Jamka sp.k., Plac Małachowskiego 2, 00-066 Warszawa, PolandT: +48 22 653 4200 F: +48 22 653 4250

Quarterly Bulletin

INTRODUCTION ......................................................................................................... 3

LEGISLATION ............................................................................................................. 4

EU: Reform of the European system of trademarks ...................................................... 4

EU: Amendment of a draft Directive on the protection of undisclosed know-how and business information (trade secrets) ........................................................................... 4

EU: Possibility of extending EU protection of geographic indications to nonagricultural products – draft EP resolution ..................................................................................... 5

PL: Amendment of the Industrial Property Law adopted ............................................... 5

PL: New provisions on “shelf fees”? ............................................................................. 6

PL: Further draft amendments of the Industrial Property Law ....................................... 6

PL: Attorneys at law as authorized attorneys before the Patent Office ........................... 7

CASE-LAW ................................................................................................................. 8

EU: The mark “Skype” too similar to the mark “Sky” – ruling of the EU General Court .... 8

EU: Proceedings in the case of an objection to the Community trademark “SPARITUAL” – ruling of the EU General Court ........................................................... 8

EU: Dispute over the mark “Cleanic intimate” – ruling of the EU General Court in the case of Harper Hygienics S.A. vs. the OHIM ...................................................... 9

EU: Louboutin succeeds again in long standing EU trade mark opposition over red sole .................................................................................................................... 10

PL: Brand with a name – ruling of the Supreme Court ................................................ 11

PL: Can a supplier of a large commercial chain sell a claim for “shelf fees” to a debt recovery firm? – ruling of the Supreme Court .............................................. 12

PL: After the end of an employment relationship, a ban on competition does not succeed to the new employer – ruling of the Supreme Court ........................ 12

PL: A dishonest suggestion – ruling of the Court of Appeal in Warsaw ........................ 13

PL: Above-margin fees always hinder market access – ruling of the Court of Appeal in Warsaw ................................................................................................. 14

PL: When competitive activities are not unfair competition – ruling of the Regional Court in Szczecin .................................................................................. 14

UK: Too late: “CANARY WHARF” trade mark not registrable ...................................... 15

OTHER ISSUES ........................................................................................................ 17

EU: A report by Europol and the OHIM on counterfeit goods ..................................... 17

EU: Aston Martin radiator grill as a positional trademark ............................................ 18

TABLE OF CONTENTS

TRADEMARKS AND UNFAIR COMPETITION 2/2015 3

Welcome to the 18th edition of the “Trade Mark and Unfair Competition” bulletin.

In this edition, we present a range of recent trademark, unfair competition and related rulings and developments, which will be of interest to international brand owners. We cover some of the important recent legislative proposals in Europe, including the latest developments on European Union (EU) trademark law reform as well as proposals for the EU Directive on Trade Secrets and the potential extension of geographical indication protections to nonagricultural products. We also provide commentary on recent cases across Europe and various member states, including a landmark decision of the EU General Court in the SKY/SKYPE dispute.

In this edition, we also welcome our new IP partner in Frankfurt, Dr Thorsten Vormann, who joins our firm. The addition of Dr Vormann to our team marks an important expansion to our firm’s IP capabilities across Europe, particularly in the areas of patent and trademark litigation and advice.

We hope you find this edition useful in keeping up to date with recent developments in this fast-paced area of change. Please do not hesitate to contact any of our authors to share your comments or questions.

Arthur Artinian

INTRODUCTION

TRADEMARKS AND UNFAIR COMPETITION 2/20154

LEGISLATION

EU: REFORM OF THE EUROPEAN SYSTEM OF TRADEMARKS

On 21 April 2015, after intense negotiations, under the Latvian presidency in the European Council, an agreement with representatives of the European Parliament has been finally reached on reform of the European system of trademarks. In the new system, account will be taken of important provisions, including: (i) a new structure and lower fees from applicants, (ii) the establishment of a mechanism for compensation to cover expenses incurred by domestic authorities protecting industrial property resulting from the introduction of procedures concerning EU trademarks, (iii) closer cooperation between domestic authorities and the OHIM on projects aimed at propagating harmonization of practices and tools in the area of trademarks and industrial designs, (iv) a change of name from “OHIM” to “Office of the European Union for the Protection of Intellectual Property”, (v) the introduction by domestic authorities of appropriate administrative procedures in the case of the expiration or invalidation of trademarks, and (vi) the adaptation of the classification of goods and services to the latest EU rulings, in accordance with the system adopted under the Nice Agreement. These reforms should result in amendments of the provisions of the Council Regulation (EC) on the Community Trade Mark and a new Directive to approximate the laws of the Member States relating to trade marks

On 10 June 2015, the Committee of Permanent Representatives of the European Council approved a compromise on reform of the European trademark system. After approval of the compromise by the Legal Commission of the European Parliament, the text of the provisions will return to the Council. After a political agreement has been reached, there will be a routine legal and linguistic verification, and then formal acceptance of the position of the Council in the first reading. At that time, the provisions will be put to a vote in the second reading at a plenary session of the European Parliament.

Source: www.consilium.europa.eu

For further information please contact: [email protected]

EU: AMENDMENT OF A DRAFT DIRECTIVE ON THE PROTECTION OF UNDISCLOSED KNOW-HOW AND BUSINESS INFORMATION (TRADE SECRETS)

We have previously reported in the Bulletin on a draft Directive of the European Parliament and of the Council on protecting undisclosed know-how and business information. The Directive is one of the instruments aimed at fostering innovation within the EU. In the view of the EU legislator, business secrets are vitally important to small and medium-sized businesses and start-ups. As is written in the memorandum clarifying the draft Directive, such companies often lack the human and financial resources required to obtain intellectual property rights and to seek protection of them.

On 19 March 2015, an amendment was published by the European Parliament of the draft Directive on the protection of undisclosed know-how and business information. Below, we present some of the most important changes to the draft:

It is specified that a trade secret or know-how should have commercial value. That value may be an existing value or a potential value. Information should be subject to protection when its disclosure could hurt the economic interests of those entities that lawfully came into possession of the information (recital 8 and article 2).

In the preamble of the Directive, a provision was added that the Directive should not affect rights to negotiate, conclude and enforce collective arrangements and to take industrial action in accordance with national law or practices in accordance with EU law which respect Union law (recital 10a).

Recital 11 is also referred to, emphasizing the preventive nature of the new Directive, taking account at the same time of the need to protect basic rights and freedoms or the public interest, including public safety, consumer protection, public health and environmental protection, without any prejudice to the mobility of workers.

The definition of a trade secret in paragraph 2 of the draft Directive is supplemented with the term “know-how”, and it is specified that a trade secret concerns business information.

The Directive is an attempt to establish a balance between the rights of entrepreneurs to protection of their commercial know-how


and the right of employees to mobility on the labour market. This is emphasized, in particular, in the new paragraph 3 in article 4, which states that the Directive will not affect:

• the application of Union or national rules requiring trade secret holders to disclose, for reasons of public interest, information, including trade secrets, to public authorities for the performance of their duties;

• the use of information, knowledge, qualifications and skills of employees obtained in previous employment, to the extent that it is not covered by Article 3.

Article 3 defines when the acquisition, use and disclosure of trade secrets is contrary to the law.

The plan to strengthen the rights of employees towards employers is also evident in the changes to article 13, in which a provision is added on the right of EU member states to restrict employees’ liability for damages towards their employers as a result of the unlawful acquisition, use or disclosure of trade secrets of the employer when employees act without such intention.

Work on the draft Directive is to be completed in the European Parliament in the autumn of this year.

Source: www.europarl.europa.eu


EU: POSSIBILITY OF EXTENDING EU PROTECTION OF GEOGRAPHIC INDICATIONS TO NONAGRICULTURAL PRODUCTS – DRAFT EP RESOLUTION

On 21 April 2015, a draft resolution of the European Parliament was published on the possibility of extending EU protection of geographic indications to nonagricultural products. After the publication of the Green Book in July 2014, this marks the first stage in harmonizing the protection of geographic indications among EU member states. In the view of the legislator, the planned amendments should lead to an improvement in the functioning of the internal market and to the increased uniqueness and attractiveness of products protected as geographic indications by guaranteeing their quality and providing effective protection

against losses caused by counterfeits and imitations. The need to harmonize provisions concerning geographic indications has also been pointed out by the Polish Patent Office in an opinion issued in connection with work on the Green Book.

Source: www.europarl.europa.eu


POLAND: AMENDMENT OF THE INDUSTRIAL PROPERTY LAW ADOPTED

On 12 June 2015, the Polish Parliament adopted an amendment of the Industrial Property Law (the Act on an Amendment of the Industrial Property Law Act and Certain Other Legislation of 12 June 2015, Parliamentary document no. 3685). We reported on changes introduced by the legislator in a previous issue of the Bulletin; the amendments are to affect such areas as proceedings before the Patent Office on granting patents. In particular, the requirement of the novelty of an invention submitted is to be softened. Under the new provisions, the disclosure of an invention within six months before the application date will not hinder the issuance of a patent if such disclosure was caused by an obvious abuse in relation to the applicant. In the final version of the amendment, though, there is no introduction of what are known as consent letters in proceedings concerning the registration of a trademark – under that concept, a business could consent to another entity’s registration of a similar trademark, and such consent would have to be considered by the Patent Office. The amendment does provide, however, the possibility of seeking a partial release from fees for submitting trademarks and industrial designs when an applicant is unable pay them.

Source: www.sejm.gov.pl



POLAND: NEW PROVISIONS ON “SHELF FEES”?

At the end of May, MPs from the party PSL tabled draft legislation on combating unfair market practices by businesses trading in food or agricultural products in respect of suppliers of those products. According to the justification to the draft, the purpose of the act is “to eliminate the use of unfair trade practices by the retail segment, including large-area retailers, from the food supply chain”.

PSL proposed extensive catalogue of prohibited unfair market practices including imposing indirect or direct fees on suppliers for accepting food or agricultural products for sale, including fees for promotional or advertising services; fees for conducting special campaigns, including for the anniversary of a retail chain; fees for transmitting information on sales of food or agricultural products in particular retail outlets; discounts on catalogues and promotions; purchase or promotional discounts; fees for introducing a new product range; fees for opening new retail outlets; no-return fees; fees for utilization costs; fees for advertising agencies to create own-brand designs; contingent and noncontingent fees; logistical fees; and fees for the electronic exchange of commercial or financial documents.

Critics of the proposal charge that the enumerative catalogue of unfair market practices contained in the draft is not a good idea, because accepting a closed list of unfair practices will only increase the creativity of commercial chains in finding new ways to impose impermissible fees. They can introduce a “shelf fee” into an agreement with a supplier under a name other than those listed in the above draft legislation.

An act involving the collection of a fee other than a commercial margin for accepting goods for sale, known as a “shelf fee”, is foreseen in the Act on Combating Unfair Competition. Article 15 par. 1 pt. 4 of the Act has, for some time, provided grounds for a number of court claims for return of “shelf fees”. The potential adoption of the new provisions in their current wording could lead to a situation in which the relationship of the new provisions to that now in force is unclear.

Further, the draft provides that every contractual provision that constitutes an unfair market practice will be deemed invalid, and in such a case a supplier will not be able to legally effectively consent to the conduct of the seller. The authors of the draft also propose a reversal of the burden of proof which is beneficial to suppliers – the burden of proof that a given sales practice does not constitute

an unfair market practice will rest on the business that is accused of engaging in such a practice.

The authority competent in cases of combating unfair market practices is to be the President of the Office of Competition and Consumer Protection. The draft Act allows the OCCP President to issue decisions imposing a monetary penalty for an infringement of the prohibition against unfair market practices, in an amount up to 10 per cent of revenue earned in the financial year preceding the year in which the penalty is imposed and not less than 100,000 zlotys.

The above proposals will certainly be the subject of further debate and, consequently, of further changes.

Source: www.rp.pl; www.orka.sejm.gov.pl


POLAND: FURTHER DRAFT AMENDMENTS OF THE INDUSTRIAL PROPERTY LAW

Work is ongoing on a draft amendment of the Industrial Property Law. The most important change is a proposal to introduce a new model of proceedings concerning the granting of protection rights to trademarks. The investigate system will be eliminated and a system of objections introduced (such as currently functions at the OHIM). Only absolute grounds for refusal of registration will be investigated, while a holder of an earlier registration will have the right to submit an objection within three months following the publication of the application (and not, as at present, within six months following a legally binding decision on granting a protection right). The PPO will be obliged to prepare information for an applicant of a new trademark on the existence of any identical or similar trademarks, which could provide grounds for an objection and a possible refusal to grant protection to the trademark submitted. Acceptance of the system of objections will mean that, in principle, protection rights to trademarks will be granted much faster than at present.

Source: www.rzecznikpatentowy.org.pl



POLAND: ATTORNEYS AT LAW AS AUTHORIZED ATTORNEYS BEFORE THE PATENT OFFICE

On 25 June 2015, the Polish Parliament passed an amendment of the Act Regulating Conditions of Entry to Certain Professions, entitled the Third Deregulation Act (Parliamentary press No. 2331). In the final version approved, despite objections from the Polish Chamber of Patent Attorneys, a provision was included amending Article 236 of the Industrial Property Act concerning the conditions for appearing as an attorney before the Patent Office. In accordance with the addition to that provisions of paragraph 11, in cases relating to submitting trademarks and maintaining trademark protection, not only patent attorneys will be authorized to represent applicants, as is currently the case, but also attorneys at law. It is worth noting that this change only concerns trademarks. In cases relating to obtaining and maintaining protection over inventions, medical products, plant protection products, utility designs, industrial designs, geographic indications and integrated circuit topographies, only a patent attorney or a person providing cross-border services in the meaning of the Patent Attorney Act will be able to represent an applicant.

Source: www.orka.sejm.gov.pl



EU: THE MARK “SKYPE” TOO SIMILAR TO THE MARK “SKY” – RULING OF THE EU GENERAL COURT

In a ruling of 5 May 2015, case No. T-432/12, the EU General Court dismissed an action by the company Skype Ultd with its registered office in Dublin against a decision by the OHIM Fourth Board of Appeal concerning a refusal to register the graphic and word trademarks “Skype”.

On 28 June 2005, the company applied for registration of those marks in classes 9, 38 and 42 of the Nice classification, including for loudspeaker systems, audio recording devices, Internet voice communication and Internet data transmission. The registration was opposed by the company British Sky Broadcasting Group plc (currently Sky plc), which based its objection on the earlier registration of the word Community trademark “Sky” (CTM 000126425).

SKYThis dispute is particularly interesting because of the profile and scope of activities of the two entities involved. Skype manages the globally popular Internet communicator of the same name, while the Sky brand is one of the most well-known television stations in Great Britain.

In a decision of 6 July 2010, the OHIM ruled in favour of Sky’s objection. Skype Ultd appealed, but the appeal was dismissed by the OHIM Fourth Board of Appeal in a decision of 26 July 2012. In particular, the OHIM found that the goods and services for which the mark “Skype” was to be registered overlap with those for which the earlier mark had been registered. The Board also pointed to the similarity of the two marks on the visual, phonetic and conceptual levels. It found that there is a risk of consumers being misled and refused to register the mark.

In its action to the Court, Skype charged that there had been an infringement of Article 8 par. 1 letter b) of Regulation No. 207/2009. It argued that the marks are not similar to each other, and that the word mark “Skype” had acquired its own meaning through use in reference to Internet communication, which in its view eliminates the risk of any confusion with the mark “Sky”. Skype also argued that both marks are so well-known that their “peaceful co-existence” is possible.

The Court noted that the two word marks are similar – visually, phonetically and conceptually. It pointed out that the word “sky”, a basic word in English, is easily identified in the word “skype”. What is more, the element “sky” within the word “skype” allows the latter to be recognized by the relevant consumer group, and the second element “pe” has no specific meaning. In regard to the graphic mark, the Court found that the addition of the element in the form of “clouds” or “bubbles” is not sufficiently distinctive to prevail over the linguistic similarity, and that, in fact, if the graphic element is interpreted as clouds, the risk of confusion with the mark “Sky” only increases. As to the idea of the “peaceful co-existence” of the two marks, the Court ruled that this would be possible but only in respect of certain services.

Source: www.curia.europa.eu


EU: PROCEEDINGS IN THE CASE OF AN OBJECTION TO THE COMMUNITY TRADEMARK “SPARITUAL” – RULING OF THE EU GENERAL COURT

On 11 February 2004, the company Orly International submitted the word Community trademark “SPARITUAL” to the OHIM. The goods covered by the application are “preparations for nail and body care”. On 25 February 2005, the company Spa Monopole filed an objection to that mark. In its justification, it referred to the earlier domestic word and word-graphic trademarks “SPA”, protected for identical and similar goods, as well as to marks that, in Spa Monopole’s opinion, have reputation.

CASE-LAW

/ SKYPE


After numerous disputes before the OHIM Opposition Division (case R 2396/2010-1) and the OHIM Board of Appeal, the case came before the EU General Court (case T-131/12). In the Court’s opinion, the stronger and closer the association of an earlier trademark with a later trademark, the greater the danger that the current or future use of the later trademark will entail undue benefits being reaped from the distinctiveness and reputation of the earlier mark. As to the concept of “reaping undue benefits from the distinctiveness or reputation of a trademark”, this is also defined as “parasitism”, meaning benefits gained by a third party from the use of a designation identical with or similar to another mark. This includes cases in which, by using a trademark (or features which that mark possesses) for other goods, there is an obvious exploitation of the reputation of that trademark. The Court found that the likelihood (especially in the case of an objection based on a mark which enjoys wide reputation) of there being a threat in the future (which is not only hypothetical) of harm being caused or undue benefits being reaped as a result of the use of a mark submitted may be so clear that the party contesting the registration need not show any other factual circumstances. The Court also held that the holder of an earlier trademark is not obliged to prove the existence of an actual, continuing infringement of its trademark.

In the opinion of the Court, the OHIM Opposition Division had rightly held that the documents presented demonstrated the reputation of the word trademark “SPA” for goods belonging to Class 32 of the Nice classification pertaining to mineral waters, and that that mark was associated with “purity, health and beauty”. As to the danger of parasitism, the Opposition Division had rightly determined that the conflicting designations were similar, because the word “sparitual” contains the word “spa”, and, for that reason, consumers could associate the two marks with each other. The Opposition Division also found that there is a link between the cosmetic products the mark submitted concerns and the mineral waters identified by the earlier mark (given that cosmetic products may contain mineral water and be used together with such water),

and, for that reason, there could be a transfer of the image of purity, health and beauty from one groups of products to the other.

In considering the case, however, the Court also found that the OHIM Board of Appeal had not made a sufficient analysis of the issue of undue benefits being reaped from the reputation of the earlier mark. In line with established caselaw, it is not up to the Court to replace an assessment made by the Board of Appeal with one of its own and even less so to make an evaluation concerning something that the Board has not yet addressed. The OHIM Board of Appeal wrongly held that, in this case, the requirements for establishing the reputation of the earlier mark had not been met and had also incorrectly neglected to assess whether there existed a danger that the trademark submitted would reap undue benefits from the reputation of the earlier mark, though, as shown above, it was obliged to do so. For this reason, the Court invalidated the contested decision.



EU: DISPUTE OVER THE MARK “CLEANIC INTIMATE” – RULING OF THE EU GENERAL COURT IN THE CASE OF HARPER HYGIENICS S.A. VS. THE OHIM

In a ruling of 13 May 2015 (case T-363/13), the EU General Court resolved a dispute over the registration of the word-graphic trademark “CLEANIC intimate” between the applicant – the Polish company Harper Hygienics S.A., and the Office for Harmonization of the Internal Market (OHIM). The company Clinique Laboratories LLC with its registered office in the United States also took part in the proceedings as an intervening party. Both Harper Hygienics S.A. and the intervening party are cosmetics companies with a presence on the Polish market.

On 1 July 2010, Harper Hygienics submitted the following mark for goods from classes 3, 5 and 16 (including tissues and cosmetic swabs, cosmetic cotton wadding, tampons, hygienic bandages and diapers):


On 3 December of the same year, Clinique Laboratories submitted an objection to that registration in all of the above classes, basing its case on the earlier registration of the word trademark “CLINIQUE”, registered in such classes as 3, 14 and 25. The company showed that its mark is registered for such goods as toiletries products and body and hair care preparations, products for cleaning teeth, and cosmetics and, therefore – in the intervening party’s opinion – for identical or similar products as those covered by the application by Harper Hygienics.

In a decision of 27 January 2012, the OHIM Opposition Division ruled in favour of the objection and refused to register the Community trademark “Cleanic intimate” for goods belonging to class 3 and, in part, for goods belonging to classes 5 and 16. That decision was later upheld by the OHIM Fifth Board of Appeal in a decision of 29 April 2013.

In its action to the EU General Court, the Polish company Harper Hygienics argued that there had been an infringement of Article 8 par. 1 letter b) and Article 8 par. 5 of Regulation No. 207/2009. It questioned both the similarity of the goods covered by the conflicting trademarks and the similarity of the marks themselves. Specifically, Harper Hygienics pointed out that the goods covered by the application and the goods for which the mark “CLINIQUE” was registered mostly belong to different classes and have other purposes: Harper Hygienics’ products are hygienic products, while those of Clinique Laboratories are cosmetic. The applicant also argued that the OHIM had not properly assessed the weight of the graphic elements of the mark submitted or the word element “intimate”, unjustifiably limiting its comparison of the two marks to the words “Cleanic” and “Clinique”.

The EU General Court was not convinced by the arguments of the applicant and confirmed the correctness of the decisions of the OHIM Opposition Division and Board of Appeal. In particular, it found that, when evaluating the similarity of goods, account must be taken of circumstances such as distribution channels, use of the goods and end-user profile, which, in this case, leads to the conclusion that the goods are indeed similar. The Court also referred to caselaw saying that goods cannot be deemed

different only because they are listed in different classes of the Nice classification. Further, the Court shared the view of the OHIM that it is the word “Cleanic” that dominates in the mark submitted, which makes that mark highly similar to the word mark “CLINIQUE”, even though the two words are pronounced somewhat differently.

Taking all of the above circumstances into account, the EU General Court found that the simultaneous presence of both marks would entail a likelihood of the relevant group of consumers being misled. This eliminates the possibility of registering the mark “CLEANIC intimate”.



EU: LOUBOUTIN SUCCEEDS AGAIN IN LONG STANDING EU TRADE MARK OPPOSITION OVER RED SOLE

Christian Louboutin (Louboutin) has again been successful in a long running opposition proceeding filed by Roland SE (Roland) against its red sole trade mark in the EU.

Louboutin has faced legal challenges around the world in registering and enforcing its signature red sole on its shoes. In 2010, Louboutin filed a Community Trade Mark application for the below trade mark in class 25 for “high-heeled shoes (except orthopaedic footwear)”:

(Louboutin Mark)

The Louboutin Mark was described as consisting of the colour red (Pantone 18.1663TP) applied to the sole of a shoe as represented in the mark. The outline of the shoe shown in broken lines does not


form part of the Louboutin Mark but rather is designed to show how the mark is applied to the shoe.

While the examiner initially rejected the application, an appeal to OHIM reversed the examiner’s decision and saw the Louboutin Mark accepted for registration. Following publication, 3 companies opposed the registration of the Louboutin Mark, including Roland, which opposed the mark on the basis of its prior filed Community Trade Mark registered in class 25 for “clothing, footwear, headgear”, depicted below:

(Roland Mark)

Roland was unsuccessful in its opposition against the Louboutin Mark both in the first instance and on appeal to OHIM. As the trade marks differed on a visual, phonetic and conceptual basis, the opposition failed notwithstanding that the marks were filed for identical goods.

Roland subsequently appealed to the Court of Justice of the European Union (Court) and in a judgment handed down this month, was again unsuccessful in its opposition against the Louboutin Mark.

The Court held that taking into account all relevant factors, including the similarities of the signs and the goods claimed in the applications, there was no risk of any consumer confusion arising that the public would associate the goods sold under the Louboutin Mark as emanating from Roland or that there existed an association with Roland.

When considered as a whole, the visual impression generated by the Louboutin Mark was that of the colour red applied to the sole of a shoe with a high heel. In contrast, the impression of the Roland Mark was of a banal graphic box containing the words “my shoes” which were descriptive of the goods claimed in the registration. The colour red was not held to be a dominant feature in the Roland Mark as it was present only in the box containing the word “shoes” and was a decorative feature that had a secondary importance to the words “my shoes”, which were considered to be the dominant part of the Roland Mark. The Court therefore held that there was no visual similarity between the 2 marks.

The Court also held that there was no phonetic similarity between the 2 marks, given that the Louboutin Mark was a figurative mark

containing no words and the Roland Mark contained the words “my shoes”.

Finally, the Court held that there was no conceptual link between a mark which depicted the red sole of a shoe with a high heel and a mark containing a red rectangle bearing the word “shoes”. Roland argued that the marks introduced a link with the word “shoes” and the common colour red, however, the Court held that there was an insufficient conceptual link between the marks (case number T-631/14).

The Court rejected the appeal on all grounds and ordered Roland to pay expenses in the opposition.

While Louboutin has faced challenges in seeking the registration of its iconic red sole, this decision now paves the way for the Louboutin Mark to be registered in the EU and arms Louboutin with important trade mark rights that it can use to take action against competitors using a red sole on their high-heeled shoes in the EU. The case of the Louboutin red sole shows that novel marks are capable of protection in the EU and that in addition to their brand names and logos, companies should invest in protecting their key brand indicia including signature colours and shapes of products, in order to maximise their asset value and arm themselves with enforceable rights against competitors.

For further information please contact: [email protected] [email protected]

POLAND: BRAND WITH A NAME – RULING OF THE SUPREME COURT

On 29 May 2015, the Supreme Court took a stance in a case of consent to the use of the name of a natural person in the name of a legal person. It ruled that Article 435 par. 3 of the Civil Code applies to every type of company, i.e. to both partnerships and capital companies (case file No. V CSK 524/14).

That provision states that the business name of a legal person can contain the name of a natural person if the use of that name in the business name serves to demonstrate connections between that natural person and the establishment of the legal person or business activity. The provision contains the proviso that it is necessary to have the written consent of the natural person whose


name is used in the business name or, in the case of that person’s death, the consent of his or her spouse and children.

The ruling was issued in connection with a dispute that arose between a natural person – a partner of a limited liability company – and the company. The partner sold his shares and undertook not to engage in activities competitive towards the company using a brand similar to that of the company. The dispute, then, centres on how to interpret that prohibition on competition, that is, should that prohibition be understood as consent to the use of the former partner by the company?

In the course of the proceedings, the Court of Appeal in Katowice held that the necessity of obtaining consent to the use of the name of a natural person in the business name of a legal person applies only to partnerships.

The Supreme Court, however, did not agree with this stance. It emphasized that the provision of the Civil Code referred to above is not limited to partnerships and, therefore, ordered that the case raised by the capital company (a limited liability partnership) be reconsidered, applying Article 435 par. 3 of the Civil Code, to assess what the joint will of the parties was when concluding the noncompetition undertaking. The Court must determine whether the prohibition on competition meant consent to the use of the name of the former partner in the business name of the company.

As of the time of this writing, the justification to the ruling has not been published.

Source: www.rp.pl


POLAND: CAN A SUPPLIER OF A LARGE COMMERCIAL CHAIN SELL A CLAIM FOR “SHELF FEES” TO A DEBT RECOVERY FIRM? – RULING OF THE SUPREME COURT

In light of a recent ruling of the Supreme Court (I CSK 694/13), the answer to the above question is yes. A provision in a cooperation agreement concluded between a retail chain and a supplier stating that the supplier must obtain the consent of the retail chain for a cession of its receivables resulting from that agreement is ineffective.

The courts of lower instance held that the retail chain had committed an act of unfair competition in the form of collecting what are known as “shelf fees”, that is, fees other than a commercial margin for selling goods provided by the supplier under a cooperation agreement concluded between the two entities. The Court of Appeal further held that fees for services related to managing customer relations, monetary bonuses, marketing budgets and Metro Link services were charged by the chain without equivalent benefits being provided to the supplier. The remuneration collected by the chain, in fact, constituted a fee for admitting the plaintiff’s goods to trade, that is, an act of unfair competition providing grounds for claiming a return of benefits unlawfully obtained.

The defendant questioned the procedural legitimacy of the plaintiff’s claim before the Supreme Court, since the plaintiff had not been a party to the cooperation agreement but had acquired the receivable from the supplier. One of the clauses of the original agreement required the consent of the defendant to a cession of receivables of the supplier resulting from the agreement, and such consent was not granted by the defendant. In a ruling of 22 January 2015 (I CSK 694/13), the Supreme Court held that the claim sought in this case certainly arose as a consequence of an event related to the performance of the cooperation agreement. Yet, the source of that claim is not the agreement binding the retail chain and the supplier but a tort (an act of unfair competition as foreseen in Article 15 par. 1 pt. 4 of the Act on Combating Unfair Competition). Therefore, the receivable in question, in the opinion of the Supreme Court, can be assigned to a third party by way of a transfer agreement, because this is not prohibited by either the act or the nature of the obligation.

Source: www.prawo.rp.pl; www.sn.pl


POLAND: AFTER THE END OF AN EMPLOYMENT RELATIONSHIP, A BAN ON COMPETITION DOES NOT SUCCEED TO THE NEW EMPLOYER – RULING OF THE SUPREME COURT

The Labor Code provides the possibility of concluding a noncompete agreement with an employee during the employment relationship or after it has ended (against payment of appropriate


remuneration). Recently, the Supreme Court ruled in case No. I PK 123/14 (11 February 2015) on whether such a noncompete agreement passes over to a new employer in the case where a work establishment is taken over.

Article 231 of the Labor Code states that, where a work establishment or part thereof is taken over by another employer, that employer becomes a party to existing employment relationships by force of law. The Court pointed out that the new employer enters into the position of the former entity employing an employee automatically. No actions whatsoever are required of the parties to confirm the transfer of all obligations.

The Court emphasized, however, that the automatic nature of the transfer solely concerns employment relationships and that any interpretation extending this is impermissible. Therefore, of key importance to the resolution of a dispute between a former employer and a new work establishment in respect of a noncompete agreement after the termination of an employment relationship is whether that prohibition and the resulting obligation on the part of the employer to pay remuneration constitute elements of the employment relationship.

The content of the prohibition on competition, which is the subject of the dispute, is that, after the termination of the employment relationship, no activities that are competitive against the employer can be undertaken and that the employer must pay appropriate remuneration. It should be emphasized that such a prohibition extends beyond the time frame of the employment relationship – the performance of the obligations resulting from the prohibition is to occur after the definitive end of the employment relationship. The Supreme Court referred to an earlier ruling from which it found that a noncompete agreement concluded between an employer and an employee does not constitute a contract within the scope of labour law.

Consequently, the Court concluded that an agreement on a prohibition of competition after the cessation of an employment relationship does not constitute an element of labour law covered by the scope of Article 231 of the Labor Code, and so the obligation to pay remuneration for not competing does not pass over to the new work establishment.

Source: www.sn.pl


POLAND: A DISHONEST SUGGESTION – RULING OF THE COURT OF APPEAL IN WARSAW

“The Prizes Department requests the issuance of a confirmation. This concerns the collection of an prize. Please send BMW to 7400 (4.88 zł)” was a message sent to consumers by the organizer of the BMW lottery from Orange Second Edition. In a ruling by the Court of Appeal in Warsaw (case file No. VI ACA 187/14), it was confirmed that that action constituted an infringement of the collective interests of consumers and an unfair market practice. The Court dismissed the appeal by the organizer of the lottery, which had not agreed with the decision of the President of the Office of Competition and Consumer Protection who, in December 2011, issued a decision that the way in which the company Internetq Poland had encouraged people to take part in the lottery infringed the law; the OCCP President imposed a fine on the company in the amount of 338,572 zlotys.

The company suggested that consumers had won a prize and had only to reply to the message: “We are delighted to announce the results: the person with the number […] – 50 percent chance at the last BMW X3. We are waiting for an SMS to 7400. 20 minutes left! (4.88 zł)”, “Important information: the Prizes Committee asks the person with number […] to send BMW to 7400 (4.88 zł). This concerns a prize: a BMW with a value of over 100,000 zł”. In reality, sending a reply only guaranteed participation in the car lottery.

The subject of the collective interests of consumers is strictly related to unfair competition law and combating unfair market practices. The Act on Combating Unfair Market Practices states that a practice infringing collective consumer interests is an unlawful action, which harms those interests and which may consist of, in particular:

• using impermissible contractual clauses;

• infringing the obligation to provide consumers with reliable, true and complete information; and

• using unfair market practices or acts of unfair competition.

The Act on Combating Unfair Market Practices states that a market practice is deemed as an action that is misleading, if that action in any way causes or could cause the average consumer to take a decision concerning an agreement that he or she would otherwise not take. In particular, one particular type of unfair market practice, aggressive market practice, is that of creating the impression that


the consumer has already obtained, will unconditionally obtain, or will obtain upon the performance of a specific action, a prize or other comparable benefit, when, in fact, the prize or comparable benefit does not exist or when the prize or other benefit depends of the consumer paying a specific amount of money or incurring other costs. The actions taken by the organizer of the lottery constituted an aggressive practice, hence the reaction of the regulator.

Source: www.archiwum.rp.pl


POLAND: ABOVE-MARGIN FEES ALWAYS HINDER MARKET ACCESS – RULING OF THE COURT OF APPEAL IN WARSAW

In March 2015, a ruling was handed down in a case brought against a retail chain by a supplier of socks, stockings and children’s knee-highs. The Court of Appeal in Warsaw upheld (most of) the ruling in favour of the supplier issued by the court of first instance. The supplier demanded, on the basis of Article 15 par. 1 pt. 4 read together with Article 18 par. 1 pt. 5 of the Act on Combating Unfair Competition (“ACUC”), the return of fees collected by the retail chain for variously named services. Some of these were to give the supplier the opportunity of logging into the database system of the retail chain, while others involved placing the claimant’s products in leaflets showing the offer on at the hypermarket or selecting certain products and putting them on special display in stores. The claimant also demanded the return of costs incurred for transport services. The courts of both instances found the claim justified, with the exception of the demand for the return of transport costs.

The ruling confirmed the interpretation of Article 15 par. 1 pt. 4 ACUC within the scope of where the burden of proof lies. That Article states that it is an act of unfair competition to hinder access to a market by collecting fees other than a commercial margin for accepting goods for sale. The defendant argued that the burden of proving that the collection of fees other than a commercial margin hindered access to the market rests on the claimant, but the courts of both instances held that it is not necessary for the claimant to prove this. The provision of Article 15 par. 1 pt. 4 ACUC is constructed in such a way that proving

that fees other than a commercial margin were collected for accepting goods for sale is equivalent to proving that access to the market was hindered.

The Court of Appeal in Warsaw found that access to the market is hindered when a barrier or obstacle exists that does not result from the type of activity conducted by the business offering buyers its goods or services, or from conditions shaping the demand for a given product or service, but from unfair actions taken by other businesses. Such unfair activities are exemplified in Article 15 par. 1 ACUC. The restriction of a supplier’s access to the market is the necessity of incurring additional fees in a situation where the alternative is to limit or even cease cooperating with an intermediary, that is, to reduce the supplier’s access to the market. The Court ruled that the termination of cooperation between the parties due to the claimant being charged with supposedly legal fees, which were disadvantageous to the claimant economically, constituted an instance of hindering access to the market.

Source: www.orzeczenia.ms.gov.pl


POLAND: WHEN COMPETITIVE ACTIVITIES ARE NOT UNFAIR COMPETITION – RULING OF THE REGIONAL COURT IN SZCZECIN

On 22 May 2015, the Regional Court in Szczecin (case file No. VIII GC 502/14) dismissed a claim brought by a school against a competing institution owned by a former employee of the school. The claimant charged that the former employee had committed an act of unfair competition by conducting activities at the same address and using advertising materials whose appearance was stylistically similar to that of advertising leaflets of the school. The claimant also accused the defendant of having infringed business secrets of the claimant by (a) using an innovating system of teaching developed by the claimant, (b) using organizational solutions concerning the method of paying for lessons and conducting and planning courses, and (c) using information on customers of the claimant. In the claimant’s opinion, the defendant incited the claimant’s customers to terminate their contracts with the claimant in an attempt to take its students away and, in fact, succeeded in doing so. The defendant denied having committed any act of unfair competition whatsoever and moved for dismissal of the claim.


In the Court’s evaluation, the claim was groundless.

The parties were not bound by a noncompete agreement, as the claimant argued by stating that the agreement, which expired on 30 June 2013, was performed by the parties after it had expired. The Court also found that there was no evidence that the defendant had in any way used information constituting a business secret of the claimant concerning original methods of teaching or running a school. Moreover, the claimant failed to specify precisely what unique and innovative elements the teaching methods it uses contain. Nor did it show that the defendant had used those elements as a business secret of the claimant. Nor was the defendant conducting business at an address similar or identical to that of the claimant, which is an act of unfair competition under Article 3 par. 1 of the Act on Combating Unfair Competition. In the view of the Court, it is quite common for several businesses having similar profiles to be located in the same building. There is no provision of law that prohibits an entrepreneur from opening an educational facility in premises close to those of another business conducting similar activities.

In the Court’s assessment, there was no infringement of Article 5 of the Act on Combating Unfair Competition, which states that identifying a business in a way that could mislead consumers is an act of unfair competition. The only common element in the names of the two businesses is a single word appearing in different variations and constituting an element of names providing information on the profile of the activities conducted. The claimant did not prove that such a function of names could be misleading.

Nor did the Court agree with the claimant’s assertion that the defendant had used advertising materials whose appearance was stylistically similar to the claimant’s advertising leaflets. This was in specific reference to the phrase “2 + 2 = 4” placed on a blackboard. The leaflets of the claimant and the defendant differ in terms of colour scheme and layout, so those differences do not meet the prerequisite for finding that the defendant’s leaflets could be confused with those of the claimant.

Witnesses at the hearing did not confirm that the defendant had incited pupils’ parents or the children themselves to resign from lessons at the claimant’s school and enrol at the defendant’s school.

Furthermore, the claimant failed to prove that the defendant had wilfully acted to deny access to and afterwards delete important files related to the activities of the claimant’s school. The defendant

only deleted the account belonging to her after the conclusion of her cooperation with the claimant. For the above reasons, the Court dismissed the claim.

Source: www.orzeczenia.ms.gov.pl


UK: TOO LATE: “CANARY WHARF” TRADE MARK NOT REGISTRABLE

“Canary Wharf” is an iconic region in the city of London, and a dominant part of the modern London skyline that houses a number of leading financial and commercial institutions. The term has become a household name for most of the British public and is widely recognised as a geographic location. Starting out as a shed and quay within the West India shipping company, the area was owned and used by the Fred Olsen shipping company in the 1930’s as a hub for the transport and shipping of fruits and goods from the Canary Islands. Today the area remains a privately owned estate which is managed by Canary Wharf Group plc.

After initial unsuccessful attempts to register CANARY WHARF as a trade mark for various goods and services in classes 16, 36, 37, 39, 42, 44 and 45, including printed matter, real estate investment, car parking and building construction services , CWG appealed the decision to refuse its application on absolute grounds. Before the UK trade mark office, the Hearing officer refused the appeal on the ground that the name “Canary Wharf” was a geographical location and would be understood by the public as referring to services around Canary Wharf, and that the name lacked acquired distinctiveness.

CWG appealed this decision, stating that the hearing officer had “effectively identified a ‘blacklist’ of goods and services for which any place name would always be refused regulation” and “failed to carry out the Windsurfing Chiemsee assessment in any structured way, or in respect of each of the categories of goods and services for which the application was made.” CWG argued that the hearing officer should have enquired if “Canary Wharf” was already in printed publications as a “common subject” and that the registration should have been allowed in any event on the basis that “Canary Wharf” had acquired distinctiveness.


In the appeal decision, the court agreed that the hearing officer had adequately carried out the assessment and considered all the services covered by the trade mark and concluded that “Canary Wharf” was likely to be taken by the general public as the geographical location. The court also agreed that the registration should be refused on public policy grounds, as granting it would restrict third parties from providing services in the area. It concluded that “Canary Wharf” had not acquired distinctiveness, as it was only in use inside a private estate in a very limited geographic area. There had only been one instance of use of the mark outside this estate, in a promotion for the Canary Wharf shopping centre.

It was stated that the appeal might have been successful, if the appeal had been made 30 years earlier when the estate was first starting development, but as the estate has grown outside of the initial area, and was now considered to be an entire business district by the public, the refusal of the application was upheld.

This case is an interesting example of a mark gaining geographic significance over time. It is a timely reminder about the importance of registering trade marks at the earliest possible stage before a name becomes synonymous with a geographical location.

For further information, please contact: [email protected]

OTHER ISSUES


EU: A REPORT BY EUROPOL AND THE OHIM ON COUNTERFEIT GOODS

In April of this year, the report “2015 Situation Report on Counterfeiting in the European Union” appears – the first such extensive and detailed report on counterfeit goods in the EU. It is the result of cooperation between Europol, the OHIM and the European Observatory on Infringements of Intellectual Property Rights.

The report shows that most counterfeit goods that reach the European market are produced outside the EU and escape detection at the EU’s external borders. Yet, studies conducted for the needs of the report also showed an increase in the production of counterfeit goods within the Community as well, in such countries as Belgium, the Czech Republic, Italy, Poland, Portugal, Spain and the United Kingdom. It seems that the manufacture of fake products on a large scale is becoming an increasingly profitable branch of organized crime. Trading in counterfeit goods is a relatively low-risk endeavour, but is connected with other forms of crime as serious as transporting people in order to exploit them. Groups engaged in such criminal activities have their roots both within and outside of the EU.

The most significant and effective distribution channel for counterfeit goods is the Internet. High-quality websites are created, which imitate shops of producers of original products and catch customers’ attention with their attractive prices. Internet shops offer fake goods 24/7, and their existence ‘between’ various jurisdictions complicates efforts to combat them. Websites that are closed down often start up again on the very next day.

In the opinion of Rob Wainwright, Director of Europol, though the phenomenon of counterfeiting goods has now taken hold within the EU, more than two-thirds of such goods still come from China. The report illustrates how Chinese gangs that distribute fake goods act in a high specialized way, often through mobile groups. In Italy, they have connections with the Camorra (local mafia). Chinese centres in Europe are well established and prosperous – for example, centres producing counterfeit clothes can be found in those provinces of Italy connected with the fashion industry and known for textile production. Organized Chinese criminal groups are also active on a large scale in Madrid and in parts of Europe. They often run a legal business as a front for the distribution of counterfeit goods, and also establish connections with a network of

agencies handling money laundering, which allows them to cover their tracks and send large sums of money directly back to China.

According to the report, though, it is India that is the biggest cause for worry by European manufacturers of pharmaceutical goods and Turkey for food products. Indonesia is known for having ineffective laws and problems with corruption, while the Philippines has a low rate of seizing counterfeit goods.

The purpose of the report is to provide information to all interested parties, including manufacturers, legislators and market players, on both the EU and domestic levels. That information is mainly about organized crime groups involved in the production and distribution of goods within the EU. The report provides details on transport routes, including places where counterfeit goods reach the market. It also describes the models according to which criminals operate, and the current activities of state institutions and the private sector in combating those operations, and explains the connections between the counterfeit goods market and other types of crime. As well as providing details on the scale and scope of such activities within the EU, the report also describes how their impact can be discovered, prevented and reduced.

One result of the report is a promise by the OHIM to create IT tools with easy, secure access for assisting the exchange of information among rights holders and law enforcement authorities. This should support cooperation between the OHIM and Europol within the Internet environment and improve the effectiveness of actions taken against counterfeiters on the market.

Source: www.europol.europa.eu



EU: ASTON MARTIN RADIATOR GRILL AS A POSITIONAL TRADEMARK1

Positional trademarks are graphic or spatial designations, which feature a particular, defined way of placing an element on a two- or three-dimensional object.

Submission of a positional mark

Positional marks are a particular type of designation, but do not constitute a separate category such as word, graphic or spatial marks. The scope of protection afforded to a positional mark results from the placing of a specific image or form in a specific position on a product.

Submitting a positional mark by indicating the specific element of the designation, which is to be subject to protection in a particular position on a product, rather than seeking protection for the rest of the designation such as its descriptive nature, in itself limits the protection sought. Such a narrowing of the scope of protection may have a positive effect on the distinctiveness of certain elements of a designation and may be helpful in establishing the scope of protection during studies conducted by an authority at the registration stage or later. In addition, some elements of spatial marks, such as a characteristic handle or grip, may be better illustrated in a submission or register when accompanied by the entire object with which they actually appear in trade.

If a trademark consists of a single image showing its position on a product, then this should be shown in a way that corresponds to its actual location on the goods when a submission is made to the PPO or the OHIM. The illustration of the mark should be sufficiently unambiguous so that the border between the characteristic part of the designation and the part of the product on which it is located is clear. The contour of the mark is drawn in a solid line, while the contours of the goods on which the mark is to be placed are drawn in a broken line.

Graphically presentable, but not always distinctive

Positional marks are not problematic in terms of meeting the criterion of graphic presentability, since they do not differ from

1. This article appeared in the daily Rzeczpospolita on 12 June 2015 under the headline: “What protection for unconventional marks”; the author is a patent attorney at K&L Gates Jamka sp.k.

standard marks in this respect. They usually feature an appropriate graphic layer, and are presented in a drawing in which a silhouette (outline, sketch, contour) of the product in the form of a broken line contains a specific image or form in the selected position. In certain circumstances, it is doubtful whether the criterion of the distinctiveness of such designations is met. When they comprise part of a product, they may be deemed to be a designation lacking initial distinctiveness.

The Aston Martin radiator grill

An interesting example of an attempt to register a positional mark was that of the company Aston Martin Lagonda Limited (“Aston Martin”) before the OHIM. The company made several submissions for Community trademarks for a radiator grill used on model cars. The contour of the radiator grill was presented in a solid line, and the contour of the product on which the mark was to be placed as a broken line. The submission concerned positional marks for such goods as cars, toys and computer games, as well as services relating to building and repairing cars.

During the assessment of the submissions, the OHIM found that the marks are devoid of initial distinctiveness and refused to make the registration for Aston Martin. In the opinion of the OHIM expert who analysed the submissions, the form of the radiator grill presented did not have features that would distinguish it from other grills existing in trade. The position was taken that a person paying attention to that brand of car would only perceive the radiator grill as a functional, technical part of the car, or as a decorative element, but not as a distinctive designation. The radiator grills used on Aston Martin cars can only be recognized by car enthusiasts and professionals. In the opinion of the OHIM, what is important for the average consumer is the logo with the name of the manufacturer, which usually appears on a radiator grill or constitutes part thereof. Aston Martin disagreed with this stance, and presented a lot of evidence demonstrating the unique style of its radiator grills in an attempt to prove secondary distinctiveness. That evidence, however, was not deemed sufficient, and the decision of the OHIM not to grant protection was upheld.

Aston Martin appealed against that decision, arguing that marks in the form of a characteristic radiator grill do constitute a distinctive and highly recognizable element of all cars of that brand, disseminated over many years of use in commercial trading. In cases R 1795/2014-2 and R 1796/2014-2, the OHIM Second Board of Appeal found that a radiator grill may constitute


a trademark, though each submission of such a trademark should be considered individually, given the various graphic illustrations of such a designation and the characteristic details attesting to its distinctiveness. In the opinion of the Second Board of Appeal, the OHIM expert had correctly found that the marks depicting the radiator grill do not have initial distinctiveness but had not made a sufficiently detailed study of the issue of secondary distinctiveness. As a result, in view of the large amount of evidence presented by the applicant, the case will be referred back to the OHIM expert for reconsideration.

Source: www.europol.europa.eu


Oskar Tułodziecki

[email protected]

Piotr Wenski

[email protected]

Dorota Koseła

[email protected]

Ewelina Madej

[email protected]

Marlena Wach

[email protected]

Ewa Rusak

[email protected]

Christine Danos

[email protected]

Michał Ziółkowski

[email protected]

Arthur R. Artinian

[email protected]

K&L Gates comprises more than 2,000 lawyers globally who practice in fully integrated offices located on five continents. The firm represents leading multinational corporations, growth and middle-market companies, capital markets participants and entrepreneurs in every major industry group as well as public sector entities, educational institutions, philanthropic organizations and individuals. For more information about K&L Gates or its locations, practices and registrations, visit klgates.com.

This publication is for informational purposes and does not contain or convey legal advice. The information herein should not be used or relied upon in regardto any particular facts or circumstances without first consulting a lawyer.

©2015 K&L Gates LLP. All Rights Reserved.

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