Making genuine use of trade marks after registration is of fundamental importance to avoid the threat of non-use cancellation. The recent European General Court decision of Hasco TM v EUIPO reminds us that trade mark portfolios are a little bit like orchards - not actively maintaining them, and replanting when needed, might mean losing the fruit!
In the EU and the UK, it is possible for a registered mark to be cancelled if there is no evidence of “genuine use” of the mark for a period of five years or more. The concept of “genuine use” is one that owners may find difficult to navigate.
The decision of Hasco TM v EUIPO now clarifies the relationship between food supplements and pharmaceutical products in the context of “genuine use”. Trade mark owners and their advisors should take note of this guidance, as they plan their commercialisation strategies in the pharmaceutical industry.
Hasco TM v EUIPO: What happened?
Hasco, a pharmaceutical company, registered a national Polish trade mark ‘NATURKAPS’ in 2004. When it noticed that another corporate owner, Esi, registered the EU trade mark ‘NATURCAPS’ in 2017, it applied for an invalidation (i.e. cancellation) of the later mark. Hasco claimed that ‘NATURCAPS’ should not have been registered thirteen years after its own registration, on the basis that the mark was confusingly similar to ‘NATURKAPS’.
In its defence, Esi first demanded that Hasco substantiate its earlier rights by furnishing proof of “genuine use”. It noticed that Hasco’s ‘NATURKAPS’ registration was more than five years old and therefore could be vulnerable to cancellation for non-use. For the purposes of the invalidation action, the earlier trade mark would be considered to cover only those goods for which use was proven through evidence. If Hasco failed to prove “genuine use” of their mark, the grounds for its invalidation attack would collapse.
“Genuine use” assessment: do food supplements count as pharmaceutical products?
Following Esi’s request, Hasco adduced proof of genuine use of its earlier trade mark.
Its trade mark was registered for “pharmaceutical products” (amongst other products) in Class 5 of the Nice Classification. However, the owner was able to furnish proof showing use only in respect of “food supplements”. The EUIPO Cancellation Division found that this was not genuine use of “pharmaceutical products” and dismissed the invalidation action, a decision which was upheld by the Board of Appeal. A further appeal was then filed before the General Court.
The decisive question before the General Court was: could use of the mark on food supplements count as genuine use on pharmaceutical products?
Hasco argued that there is no clear boundary between medicinal products and food supplements as such. After all, we can all think of many examples found on shop shelves that may support this line of argument: juices that claim to improve your immunity, teas that promise to better your ability to sleep, and a rising range of CBD products that allude to inducing calmness. Despite this, the General Court was not convinced that “food supplements” can be equated with “pharmaceutical products”.
First, the fact that “pharmaceutical products” and “food supplements” loosely fall within the field of health was not sufficient by itself. The connection between those products was found to be nebulous. The General Court applied stricter – and accurate – definitions and differentiated the products based on their different purposes. It held that the term “pharmaceutical products” covers products which have the purpose of “treatment or prevention of illnesses”, whilst “food supplements” aim “to supplement the nutritional value of the normal diet of a human being”.
Secondly, it was not convinced by the fact that both products could potentially be sold in pharmacies. The court held that the mere fact of sale of certain goods in pharmacies did not automatically confirm their nature as that of pharmaceutical products. We can point to the fact that it is increasingly common for pharmacies to sell beauty-related products, such as shampoos and moisturisers, to see that applying a “point of purchase” test to determine the nature of a product could lead to some absurdities.
“Genuine use” assessment: clarity and certainty for all traders
In a further attempt to convince the court that “food supplements” constitute “pharmaceutical products”, Hasco pointed out that food supplements were classified as medicinal products under Polish law at the time that it filed its application for the ‘NATURKAPS’ trade mark.
The court considered this to be irrelevant. It insisted on the application of the guiding principles of EU law for interpreting trade mark specifications (i.e. lists of products and services which a trade mark covers), namely those of clarity and precision. It stated that applicants must use terms in a way that enables others looking at the trade mark register to determine right away the extent of protection covered by their mark. Even when a national mark is relied on against an EU mark, it will be the EU principles of clarity and precision that the applicant/owner will be held to. It is for the applicant to ensure that they use terms in their specification in a manner that clearly demarcates the scope of protection that they are seeking.
On balance, EU law appears to favour a literal and purposive construction of terms included in a trade mark specification. Its overarching aim is to ensure certainty for all current and future traders.
Takeaway points for pharmaceutical traders
This decision serves as a helpful reminder to EU trade mark owners and hopeful applicants that selection of terms for a trade mark specification is an ever-important task. The specification terms determine the scope of rights which are granted at registration, and can play a key role in the assessment of “genuine use” as they did in Hasco TM v EUIPO.
Prospective UK and EU trade mark applicants in the pharmaceutical industry should consider very carefully what products and/or services they are using their mark on and consult their advisors during the trade mark application process. This is especially important given the great nuance and diversity found among modern pharmaceutical products. In the UK, the applicant must also satisfy the requirement to have a bona fide intention to use the mark for the goods applied for.
We can help ensure that you obtain a trade mark whose scope covers your specific interests and that you engage in rights-maintaining use thereafter, so that your rights remain safely preserved.
