Legal Alerts/6 Nov 2017
Legal Alert: CACTUS – The CJEU Confirms the Principles of Legitimate Expectations
The CJEU rendered on 11 October 2017 its judgement in the Cactus case (C-501/15 P). The judgement confirms that the IP Translator and Praktiker judgments, which fundamentally changed the approach to the scope of protection of EUTMs, do not have retroactive effect.
What was the Cactus case about?
In essence, the Cactus judgement confirms that the scope of protection of a trademark registered before 19 June 2012 will be decided under the rules in force at the time of registration of such trademarks.
Cactus SA filed an opposition against an EUTM application for a figurative mark incorporating the words “Cactus of Peace” and “Cactus de la Paz” based on Cactus SA’s word and a figurative mark for CACTUS registered in 2001 and 2002. These marks covered the class heading for services in class 35, namely “Advertising, business management, … business administration, office functions…”. The decisive question was whether the earlier “Cactus” marks actually covered retail services in class 35.
The Opposition Division considered that the provided evidence showed genuine use of the earlier word marks, among others, for “retailing of natural plants and flowers, grains; fresh fruits and vegetables” in Class 35. The Second Board of Appeal of EUIPO, however, upheld the appeal and dismissed the opposition. It considered that the Opposition Division was not right in its view that Cactus had showed the proof of genuine use of its earlier trademarks in respect “retailing of natural plants and flowers, grains; fresh fruits and vegetables”.
However, the CJEU concluded (in line with the General Court) that the limitation derived from the prior Praktiker (C-418/02) and IP Translator (C-307/10) judgements did not apply to and could not change the scope of protection of Cactus SA’s earlier marks. The CJEU referred to the opinion of the Advocate General stating that this approach is moreover consistent with the principles of legal certainty and protection of legitimate expectations. The opposition was thus, upheld.
The Praktiker judgement in 2005 established that applicants claiming “retail services” must specify the goods to which such retail services relate. After the said judgment, the EUIPO changed its practice and started objecting applications listing “retail services”. The IP Translator judgment in 2012 established that a class heading may be interpreted as covering the goods or services included in the alphabetical list of that class, provided that the individual terms in the class heading is sufficiently “clear and precise” and that the application reflects the applicant’s intention to cover all the goods or services included in that alphabetical list. The question subject to dispute was whether translation services in Class 41 were covered by the class heading in Class 41 “Education; providing of training; entertainment; sporting and cultural activities”. As a result of the IP Translator judgment, the EUIPO practices, the Community Trade Mark Regulation and the Trade Marks Directive introduced substantial changes to the future classification practice by which a class heading covers only goods and services that fall within the literal meaning of such class heading and EUIPO did also issue guidelines that applied retroactively. The retroactive effect of the judgements remained, however, unclear.
What are the effects of the judgment in the Cactus case?
Due to the European Trade Marks Regulation it is questionable whether the Cactus case can be relied on to restore the protection of the EU trademarks listing class headings granted before the IP Translator judgment. Under the said Regulation, such marks will be deemed to only cover goods and services falling under the literal meaning of its class headings, unless declared otherwise by the owners during the now expired grace period.
This judgment is, however, a welcome development from the Finnish perspective. Before the recent IP Translator judgment, Finnish registration authorities applied the principle where class headings refer to all goods and services covered by such class. The judgment is expected to clarify the evaluation of the actual scope of protection for Finnish trademarks granted before the IP Translator judgment since the Cactus case confirms the principle of the actual scope of protection intended at the time of the registration of the trademark.
The Cactus judgment concerned only EU trademarks, but it provides an answer to the retroactive effect of a decision concerning the scope of a national trademark under the Trademark Directive. Since the aim is to uphold the functioning and harmonized parallel schemes of EU trademarks and the fundamental principle of legitimate expectations, we assume that the IP translator case will not have retroactive effect on Finnish trademarks granted before the IP Translator judgment.
Borenius’ lawyers are available to assist in addressing any questions you may have regarding this client alert. Please feel free to contact any of the Borenius attorneys listed in this alert or those with whom you usually work.