Luxury brands jealously guard their logos and trademarks, which often symbolise luxury, style and exclusivity to millions of people worldwide. No matter how famous and well-known the brand may be, Chanel has experienced first-hand that this reputation does not mean that the other rules of the game of trademark law are pushed aside.
Trade mark infringement?
Let us remind you of the basic principles of trademark infringement. In order to decide about a possible trademark infringement, it is best to follow the 3-step-test:
- Are the goods identical or similar?
- Are the signs used similar or identical?
- What about the underlying dependency and reputation of the earlier trademark?
Chanel v. Huawei
Back in 2017, Huawei filed a trademark application with the European trademark office EUIPO for a logo (figurative mark) which was then believed to be used for their new digital assistant Celia – a sister to Siri (Apple), Alexa (Google) and Bixby (Samsung).
The description of the goods was quite broad but was entirely in class 9 (computer hardware and computer software, voice recognition, communication etc.).
Chanel was quick to lodge an opposition. They based their opposition on their logo, which was already registered in 2013, including in the same class 9 (for sunglasses, earphones, etc.) and even older, in 1985 in classes 3, 14, 18 and 25 (where we find the Chanel classics such as perfumes, cosmetics and clothing).
Such opposition means that an older trademark opposes the registration of a newer trademark application.
Three times is the charm?
Chanel saw its opposition swept aside, and appealed against this rejection. However, the Appeal Chamber within EUIPO again upheld the rejection of the opposition. It is against this that Chanel appealed to the European Court of First Instance, where it was once again ruled against.
The final decision
No similar goods
One might ask whether Chanel stood a chance at all, and why it has clung so hard to its own right? After all, the first step of the 3-step test clearly seems to fail: the goods that Chanel puts on the market are difficult to confuse with the products of Huawei. Can there be a likelihood of confusion then?
So under the specialty rule, the likelihood of confusion does not protect against dissimilar goods or services. Think of LOTUS for speculoos, for sports cars, and for toilet paper.
Reputation of the older brand
Everything has to do with the reputation that is weighed in the balance. It also plays a major role in the assessment of the likelihood of confusion.
Reputation is a somewhat vague concept But when an older trademark enjoys a certain reputation within the EU, the registration of a newer trademark application for a similar sign can be refused, even when the goods or services are different!
No one will dispute that Chanel, and more specifically its registered logo, enjoys a great reputation. It is one of the most influential fashion brands in the world, with a turnover of more than 10 billion euros (2019).
Therefore, there are certainly arguments that this reputation is sufficient to put aside the lack of similarity between the goods, and to refuse the registration of a later mark, because otherwise it could “hitch a ride” on the efforts made by Chanel to build up this reputation.
And what about the resemblance of the characters?
In the urge to secure its reputation, Chanel did misjudge one very important element. After all, it has to be about similar signs, even if the goods are not identical, but there is a reputation at stake. Without similar signs, there can be no likelihood of confusion at all.
Let us take a closer look:
Do you see a similarity? The EUIPO and the European Court of Justice certainly do not. Similarity should be assessed on three levels: conceptual, aural and visual.
The fact that both signs have a geometric element in the form of a circle does not make them conceptually similar. After all, a circle in itself has little ‘distinguishing capacity’ as a concept.
Neither is it intended for both characters to be pronounced, so an aural comparison is not required.
And what about the visual? It is always a concrete exercise, but the verdict here is that the conflicting trade marks as a whole are visually different, despite the presence in each of them of two overlapping curves within a black circle, which moreover have a geometric element in common.
Chanel itself does not seem to have missed the mark: their argumentation recognises that the visual similarity is rather low, but that by turning the Huawei mark 90 degrees, a greater similarity is created.
It is important to note that this reasoning was not followed legally. In assessing whether they are identical or similar, signs must be compared in the form in which they are protected, i.e. as registered or as they appear in the application for registration. The actual or potential use of registered trade marks in another form is irrelevant to the comparison of the signs.
In the assessment of an opposition, the orientation of the signs, as set out in the application for registration, may have an impact on the scope of their protection. Therefore, contrary to Chanel’s wishes, the comparison between the signs can only be made on the basis of the forms and orientations in which the signs are registered or applied for.
Forming an opinion about a possible trademark infringement? It is all a matter of weighing things up. We will be pleased to help you via firstname.lastname@example.org.
Written by Sofie Moore, Legal Adviser deJuristen, and Kris Seyen, Partner deJuristen