The effect of time on brands

The function of a trademark is to guarantee to the consumer the origin of a product or a service that it designates, and this for a renewable period of ten years according to article L.712-1 of the Intellectual Property Code.

However, this duration is not intangible and has been limited by the legislator in order not to grant the owner of a trademark a monopoly for too long on a sign in categories of goods and services that he would not exploit.

The owner of a trademark has five years from the date of registration to start using it. If the trademark is not used at the end of the five-year period, it may be cancelled for lack of serious use according to the provisions of Article L.714-5 of the Intellectual Property Code. This is the ” revocation of trademark for non-use “.

The owner of a trademark risks losing the exclusive right to use a sign.

In a recent decision, the European Union Intellectual Property Office (EUIPO) has, for example, cancelled the trademark ” Big Mac “The Court ruled that the owner, McDonald’s, had not made serious use of the trademark for an uninterrupted period of five years for the following reasons products and services registered (Article L.714-5 of the Intellectual Property Code).

In this case, McDonald’s had submitted several proofs of use to the EUIPO, but they were not considered serious enough to prove the use of the “Big Mac” sign as a trademark.

Thus, while the legal conditions for forfeiture may seem clear, they must be understood in the light of the judges’ interpretation of them.

The grace period

According to the aforementioned article L.714-5, the revocation takes effect five years after the date of registration of a trademark, or five years after the last act of exploitation of its owner.

This period is considered by the case law of the CJEU as a ” grace period ” that allows the owner of a trademark to start its exploitation (CJEU, 21 December 2016 – Länsförsäkringar AB v. Matek A/S).

It is important to note that the serious use of a trademark begun or resumed in the three months preceding the application for revocation and after the owner has become aware of the possibility of this application, does not prevent the revocation.

Case law has also insisted that genuine use of a trademark must be demonstrated during the grace period, thus insisting that these are cumulative conditionsThe Court of Appeals of the French Republic (CA Paris, Pole 5 ch.2, June 14, 2019 n°17/21171).

The exploitation of the trademark within the five-year period is therefore imperative to avoid its forfeiture.

Serious use

The use allowing to validate the exploitation of a trademark must be ” serious ” which means public and real.

This use must not be made solely for the purpose of maintaining trademark rights, but must also guarantee the consumer the identity of origin of a product or service (function of the trademark).

Case law has reaffirmed this principle by stating that, in order to be considered serious :

” the use of the sign must be made, in accordance with its essential function, as a trademark to identify or promote in the course of business in the eyes of the relevant public the goods and services covered by the application and opposed to the defendants: it must be outward-looking and public and not internal to the company or the group to which it belongs.

The serious nature of the use, which unlike non-use does not have to be uninterrupted, implies that it makes it possible to create or maintain market share for the owner of the trademark for the goods and services concerned with regard to the economic sector in question, and that it is neither sporadic nor symbolic, since it is intended solely to maintain the rights in the trademark. ” (TGI Paris, 3rd chamber 2nd section, June 2, 2017 n° 16/01939).

There are, however, several nuances to the characterization of ” serious use ” in the case law.

• Use of a trademark in a modified form that does not alter its distinctive character

First of all, the use of a sign in a modified form that does not alter its distinctive character does not constitute a serious lack of use according to paragraph 3 of article L.714-5 of the Intellectual Property Code.

In particular, the Court of Appeal accepted that the modified use of the “QUINTE +” trademark could serve as evidence of a trademark exploitation during the grace period, thus avoiding the “PMU” the revocation of its trademark (CA Paris, pole 5 ch.2, June 7, 2019 n°17/17646) .

It also accepted the use of the trademark “LOFT” in association with the terms “RUBBER, RAW CONCRETE, PRIMARY, Waxed CONCRETE, ORIGINAL, PROTECTIVE”, stating that these terms of the ” everyday language “aimed only to inform the consumer about the purpose of the products in the range declined from the brand “LOFT” (TGI Bordeaux, May 14, 2019 No. 15/08879) .

The Court of Appeal also held that a trademark owner could rely on the use of a sign in complex sets that would themselves be registered as trademarks, provided that the formal modification does not alter the distinctive character of the sign (see article – the use of a trademark in a modified form). The Court thus accepted the use of the sign “Juvederm” associated with other signs such as “ultra”, “voluma”, “volift” or “hydrate”, thus preventing the revocation of the trademark “Juvederm” (CA Versailles, 1^era ch. 1^1st section, September 29, 2020 n°19/01666)

• The number of serious uses

The serious use of a trademark does not necessarily have to be assessed on the basis of quantities, as it may depend on the characteristics of the product or service concerned.

Indeed, the serious use of the trademark should not be assessed quantitatively but qualitatively.

The Court of Cassation has, for example, ruled that the use of the trademark “L’Equipe” to designate a sporting event constitutes a serious use that precludes the revocation of the trademark, even though this event would have happened only once (Cass. Com March 27, 2019 n°17-18.733).

An insignificant use of a trademark may be sufficient to be qualified as ” serious use ” taking into account the economic sector considered (Cass. Com July 5, 2017 n°13-11513).

The CJEU has thus considered that a highly specialized market, in this case that of luxury sports cars, can justify a low level of use of the trademark (ECJ, October 22, 2020 C-270/18 and C-721/18).

• The just motives reasons for not using it

There are conditions under which it can be justified not to use a trademark for five years, in particular because of an obstacle that would have prevented the exploitation of a trademark.

Case law has established the following three conditions:

• the obstacle must have a direct relationship with the brand;
• the obstacle must be beyond the control of the trademark owner;
• the obstacle must make the use of the trademark impossible or unreasonable.

It has thus specified that an unfair competition action relating to the infringement of a sign and trade name does not have a sufficiently direct relationship with the use of a trademark and cannot justify its non-use (CA Paris, Pole 5, ch n°2 – May 17, 2019 n°18/06796).

Type of action

For French trademarks, revocation may be exercised by way of action or by way of exception, as a counterclaim in an infringement action.

For European Union trademarks, revocation can be brought before the EUIPO or in an infringement action as a counterclaim. In the second case, the judge will have to stay the proceedings before making a decision on the infringement.

However, this action is reserved for the person who succeeds in demonstrating that the products or services for which he or she is seeking the revocation are part of his or her professional activity.

Article L.716-3 of the Intellectual Property Code provides for the possibility of filing a request for revocation before the competent judicial courts but also, since April^1, 2020, before the National Institute of Industrial Property (INPI), as is already the case for oppositions. This measure is intended to speed up the processing time of procedures.

Products and Services concerned

As the revocation action is directly linked to the exploitation of a trademark, it is appropriate to focus on the goods and services for which the trademark has been registered.

In fact, if the revocation action were to be brought against only part of the goods or services for which the trademark is registered, the owner could be revoked only for the goods or services concerned.

He will then have to provide evidence of use of his trademark in each of the registered goods and services, in order to demonstrate that he does not hold an unjustified monopoly on the sign that he has registered.

For example, the Court of Appeals recognized that the filing of a so-called “barrage” mark does not constitute a just cause to legitimize the non-exploitation of a trademark.

In this case, the Mont Blanc company, famous for its cream desserts, had also registered the trademark of the same name to designate alcoholic beverages. However, Mont Blanc has never marketed alcoholic beverages under the Mont Blanc trademark because the trademark was registered solely with the intention of preventing the marketing of these products under the same name.

Indeed, Mont Blanc was concerned that the marketing of alcoholic beverages would damage its image. However, as this ground was not valid, the Court of Appeal declared the partial revocation of the Mont Blanc trademark insofar as it designated alcoholic beverages (CA Rennes, ch. n°3, October 6, 2020 n°16/05278).