It may be surprising to many that up until now it has been very difficult to register a trade mark containing DONUTS (or a variation):
(a) in respect of “donuts” (or, if you like, “round-shaped dough biscuits”);
(b) in Spain or as a Community Trade Mark.
That is, unless you are Panrico SA.
If you are not Panrico, then you could – only figuratively speaking – end up with donuts.
The latest round in the Bimbo line of cases confirms that this will likely continue for some time into the future. Donut eaters in Europe may need to start looking for alternatives. Perhaps Dominique Ansel’s Cronuts and Waffagatos could find this a very receptive market …
Bimbo SA filed a CTM application for BIMBO DOUGHNUTS in 2006, in respect of “pastry and bakery products, specially donuts” in class 30.
Panrico SA opposed based on a number of earlier registrations, including a Spanish registration for DOGHNUTS in class 30 in respect of “pastry products and preparations …; round-shaped dough biscuits”.
The opposition was upheld by OHIM’s Opposition Division, and OHIM’s 4th Board of Appeal.
Bimbo SA’s appeal to the General Court was rejected. Bimbo SA had – not unsurprisingly – argued that “DOUGHNUTS” in its mark was descriptive. But, judging the matter from the perspective of the average Spanish consumer, the General Court considered that “DOUGHNUTS” was not descriptive, and referred to the infamous decision of the European Court of Justice (‘CJEU’) in Medion, in which it was held that “where goods or services are identical there may be a likelihood of confusion on the part of the public where the contested sign is composed by juxtaposing the company name of another party and a registered mark which has normal distinctiveness and which, without alone determining the overall impression conveyed by the composite sign, still has an independent distinctive role therein”. Following that lead, the General Court held that “DOUGHNUTS” had an independent distinctive role in Bimbo’s mark. It did not combine with the “BIMBO” element of the applied for mark to form a “unitary whole” or “logical unit”. As the goods were identical and the marks had visual and phonetic similarities, the 4th Board was correct to find that there was a likelihood of confusion.
Following the opinion of Advocate-General Mengozzi in January this year (he gave his recommendation that the CJEU should reject Bimbo’s appeal but also suggested that it was time to reconsider the boundaries of Medion), the CJEU has now issued its decision. Roberto Pescador of our London office has admirably summarized the CJEU’s decision in the following way, including his own view as a proud and passionate Spaniard.
“The CJEU has upheld the General Court’s decision but has not followed the Advocate-General’s lead in attempting to re-define Medion. Bimbo argued that the General Court’s decision contradicted established case law that the average consumer usually perceives a trade mark as a whole and only in exceptional cases is it possible that a component of a composite mark may retain an independent distinctive role. The General Court’s decision – Bimbo argued – implied that any trade mark composed of two elements, one of which is a trade mark with a reputation and the other a trade mark with an average degree of distinctiveness, with no particular meaning for the relevant public, would be regarded as consisting of two components each having an independent distinctive role.
The CJEU confirmed that the General Court had carried out the necessary global assessment taking into account all the factors of the case in ascertaining whether there was a likelihood of confusion between the marks: the decision had not been based merely on the fact that the term “doughnut” had an independent distinctive role within Bimbo’s mark. Further, the CJEU confirmed that, following Medion, where an earlier mark is used by a third party as part of a composite sign that includes the company name of the third party, that earlier mark might retain an “independent distinctive role” – provided that it does not form a unit with the other elements of the composite sign having a different meaning than those components taken separately, and even if the other elements of the composite sign are the dominant ones. As the CJEU only considers appeals on a point of law, it did not (sadly) consider whether the word “doughnut” within Bimbo’s mark was descriptive of the goods (as claimed by Bimbo), which sounds like a chance missed. As a native Spaniard, I really fail to understand why OHIM, the Board of Appeal and the General Court are so certain that a Spanish consumer would not understand the term of the word “doghnuts”, even if they are not proficient in the English language.”
The decision of the CJEU in Bimbo is a stark reminder to brand owners that what is generic matter in one territory, can be quite distinctive in another. Bimbo is one of a long line of companies that has tried and failed in its attempts to register a mark containing DOUGHNUTS as a CTM.
On a related front, HDN Corporation, owner of the KRISPY KREME brand, has been fighting its own battle in respect of its KRISPY KREME DOUGHNUTS logo (below). Panrico applied to cancel that registration, and the next step in this case (Case T-534/13) is for the General Court to decide on HDN’s appeal against the decision of the 4th Board of Appeal.
What about Australia?
The issue of the relevance of foreign language and meaning is a live one under Australian law. InModena Trading Pty Ltd v Cantarella Bros Pty Ltd  FCAFC 110 (Cantarella) (discussed here), registrations for CINQUE STELLE and ORO were held invalid by the Full Federal Court under s41 on the basis that each mark was not inherently distinctive (overturning the earlier decision of Emmett J). This was based on Australia’s leading test (Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511 (at 514)), which is based on the needs of traders rather than being a consumer-facing test.
Cantarella has been appealed to the High Court, and there were some interesting and illuminating comments raised in the special leave hearing, so stay tuned.