Analysis of the Spanish Supreme Court’s Judgment of September 2015 in “Gullón” (I): Look-alike, the New Frontier for Trade Mark Infringement
On 2 September 2015, the Spanish Supreme Court gave its judgement 450/2015 (ECLI:ES:TS:2015:4245) in which it ruled on two highly relevant issues: first, it dealt with a case of “look-alike” products, which is the subject matter of the current post and is significant any time an undertaking markets products whose appearance is extremely similar to that employed by a competitor to puts its products on the market; secondly, as it will be a matter for a second post, the Supreme Court focused on the EU case-law’s interpretation of the concept of genuine use of Community trade marks, for the purposes of upholding a revocation action for non-use.
The issue concerning trade mark protection against possible infringements in look-alike cases has been brought before Courts of various Member States. Look-alike products are characterized by the imitation of the appearance of a competitor’s product, whether it is protected by means of a figurative or tridimensional mark or a design. However, in most of the cases look-alike products do not bear logos or marks which are similar to those identifying the imitated products.
It is for the Courts to determine to what extent a trade mark holder can be requested to tolerate that a competitor uses on its products’ packaging signs and elements that create a link or that evoke their registered trade marks or the appearance of their products.
The Spanish Supreme Court analyzed this issue in its judgment of 2 September 2015 in relation to a complaint filed by Kraft Foods Global Brands LLC, Kraft Galletas Production SA and Kraft Foods España Commercial SL (hereinafter referred to as Kraft) against Galletas Gullón SA (hereinafter referred to as Gullón). By means of its decision the Supreme Court put an end to the longstanding dispute between the Parties, which stemmed from trade mark infringement and unfair competition actions brought by Kraft before the Community Trade Mark Courts of Alicante.
Both Kraft and Gullón are leading companies in the Spanish food market sector, and are engaged in, among others, the production and commercialization of biscuits. Kraft considered that the marketing of Gullón’s “Morenazos” biscuits and the corresponding packaging amounted to trade mark infringement of its “Oreo” biscuits and related packaging. Likewise, Kraft opined that its tridimensional trade mark consisting of the packaging of the “Chips Ahoy!” biscuits had been infringed in the view of Gullón’s marketing of the packaging of the “Cookies” biscuits.
At first instance the Mercantile Court no. 2 of Alicante held that only the “Cookies” packaging had infringed Kraft’s Spanish and Community well-known marks “Chips Ahoy!”, as reproduced below.
Further to both Parties’ appeals, the Court of Appeal of Alicante partially revoked the first instance decision. On the one hand, the Court deemed that the marketing of the “Cookies” packaging constituted acts of unfair competition. On the other hand it upheld the trade mark infringement of the national well-known mark “Oreo” held by Kraft as caused by the production and commercialization of Gullón’s “Morenazos” biscuits.
In view of the above contrasting decisions, Kraft and Gullón brought the case before the Supreme Court lodging their corresponding extraordinary appeals for procedural infringement and cassation appeals.
As regards the issue of the trade mark holders’ tolerance of look-alike cases – which is the subject matter of this post – the Supreme Court’s judgment denied all claims based on the likelihood of confusion between Gullón’s products and Kraft’s marks “OREO” and “Chips Ahoy!”, under both the trade mark infringement and unfair competition perspectives. The decision was grounded on two arguments.
The first argument is that the term “OREO” is a notorious sign having such a distinctive and dominant character that its presence within the homonymous packaging of biscuits passed on its notoriety to the corresponding Spanish trademark. Therefore, the lack of any reference to that term within the “Morenazos” packaging excluded the infringement of Kraft’s Spanish trade mark. This was due to the circumstance that, in the case of the packaging under comparison, the connection required by Article 9.1.c) of Regulation 207/2009 CTM (RMC) to protect well-known trade marks was not created in the Spanish consumers’ mind.
The Supreme Court’s conclusions were not undermined by the fact that the “Morenazos” biscuits were marketed in a packaging that reproduced at least evocative characteristics of the Spanish trademark representing the “OREO” packaging: a blue box characterized by the image of sandwich biscuits jumping out of a glass of milk.
Possibly, the Supreme Court’s appreciation relied on the fact that it was not proved that Gullón had increased its sales by the time it changed the color of the “Morenazos” packaging from red to blue. Therefore, the Supreme Court rejected the existence of any unfair connection with Kraft’s trade marks and products, in that apparently Gullon had not taken advantage of the repute of its competitor’s marks.
Moreover, the Supreme Court disregarded the results of the survey submitted by Kraft, showing that 52% of respondents, looking at the blue “Morenazos” packaging, associated it with the “Oreo” biscuits. Instead, the Court justified such association in the view of the representation of sandwich biscuits on the “Morenazos” packaging, which are similar to both the “Oreo” biscuits and the corresponding the three-dimensional Community trade mark held by Kraft.
Likewise, the same argument of the distinctive and dominant character of the well-known term “OREO”, written inside the oval shape placed at the center of Kraft’s biscuits, help reject the infringement of the corresponding three-dimensional Community trade mark. To this end, the Supreme Court stressed that the contested decision correctly carried out a global appreciation of Kraft’s mark’s distinctiveness. The decision indeed recognized the due importance of the term OREO and excluded that the “Morenazos” biscuits evoked it. This conclusion was also supported in the view of the different patterns carved in the biscuits’ surface.
The second argument concerns the dismissal of Kraft’s claims that Gullón have engaged in acts of unfair competition in relation to its trade marks consisting of the packaging of the cookies Chips Ahoy! and OREO.
The Supreme Court stated that the assessment of the existence of unfair acts of confusion is based on a time analysis of the use of the signs in the market. Given that Gullón was able to show the exact moment in time when it started marketing the “Cookies” packaging and Kraft could not prove an earlier use of its “Chips Ahoy !” packaging, the Supreme Court held that in the context of the review of the legality of the contested decision it could not rule on the merits or reliability of Gullón’s claims.
However, the Supreme Court applied again the argument of the distinctiveness of the term “Chips Ahoy!” in order to rule out that Gullón’s marketing of the “Cookies” packaging counted for unfair acts of confusion and unfair advantage of another’s reputation. In that assessment it was also relevant the analysis of the independent distinctive role of the term Chips Ahoy! within the corresponding packaging, although the confronted products could look alike.
The same contradictory considerations have been developed by the Supreme Court to deny that the use of the “Morenazos” packaging was unfair because creating confusion with the “Oreo” packaging. The similarities of the configuration, size, color, images of the biscuits jumping out of glass of milk, and the representation of the signs “OREO” and “Morenazos displaying a similar inclination and font, have not been considered evidence of a look-alike product because those terms “OREO” and MOREnazos were different.
In any event, the Supreme Court’s judgment is in line with the national and European case-law which requires a likelihood of confusion to establish the existence of trade mark infringement; in case of well-known marks, a link and/or an evocative relationship between registered trade mark and the look-alike product are requested. This is so in order to demonstrate the risk that such connection will help the competitor divert consumers from the trademark holder to the infringer (see judgement of TS 505/2012, of 23 july, ECLI:ES:TS:2012:6110; ECJ 23 October 2003, C-408/01, “Adidas-Fitnessworld” y de 18 junio 2009, C-487/07, “L’Oreal”).
It is common ground that trade mark infringement and unfair competition claims against look-alike products entail difficult cases, precisely because the infringer imitates the competitor’s packaging and not directly its trade marks. However, the Supreme Court’s analysis in the present case does not comply with the necessity of affording protection to trade mark holders and results in nothing but an extension of the vacatio protectionis against these unfair practices.
A suitable strategy in look-alike cases would be showing that the competitor unfairly behaviors in those ways typified by the law. In this regard, the assessment of the Court of Appeal of Alicante seems to be the most appropriate and consistent with a global assessment of the likelihood of confusion from the perspective of both trademark infringement and unfair competition.
At the end of the day, Gullón’s specific intention of carrying out acts of unfair competition such as acts of imitation, confusion and unfair advantage of Kraft’s reputation could have been grounded on the commercialization of the same type of biscuits and their corresponding packaging: two black layers filled with white cream, so that the “Morenazos” and “Cookies” biscuits respectively mimic the “Oreo” and “Chips Ahoy!” biscuits.
All the above is even more evident if considering that from the outset the freedom to conceive the packaging of sandwich biscuits is high, where it comes to choose its colors and graphic elements. Consequently, such freedom can result in a sufficient differentiation between packaging, as is the case for those other sandwich biscuits that other companies place in the market, as it appears from the examples blow.
In any event, it is recommended that trade mark holders build their look-alike cases always taking into account all factors relevant to the circumstances of the dispute. Therefore, where they have to opt for a trade mark infringement or unfair competition actions, according to the principle of the relative complementarity, they need to consider that the lack of similarity between the products’ names is likely to lead the Courts to dismiss their actions.
Related Posts:
- Analysis of the Spanish Supreme Court’s Judgment of 2 September 2015, “Gullon” (II): Application of the European Case Law on the Genuine Use of Trade Marks
- Four Recent Judgments of the Spanish Supreme Court relating to Trademarks (III): “Champín”
- The Supreme Court confirms that, in the absence of a link in the mind of the consumer, the reputation of the earlier mark is irrelevant
- The use of trademarks as adwords cannot be considered as taking unfair advantage from a third party´s reputation