Liz Earle Beauty Co appeared before the EU General Court in a bid for monopoly rights in a phrase that “on the face of it” might seem like a common descriptive phrase any cosmetic marketer should be free to use. Emily Devlin reveals the judgment of the court, wrinkles and all.
Who: Liz Earle Beauty Co Limited v OHIM
When: 9 December 2010
Where: The General Court (previously the Court of First Instance)
Law stated as at: 1 January 2011
Well-groomed women in the know will be aware of the "Naturally Active" skin care range created by beauty guru Liz Earle. However, despite Ms Earle's success providing botanically-based skincare to affluent ladies of a certain age, the EU's General Court was not convinced that she had built up the necessary distinctive character in the NATURALLY ACTIVE name so as to achieve registration as a Community trade mark ("CTM").
By way of background, Liz Earle Limited ("LEL") made an application for a CTM for NATURALLY ACTIVE in a variety of classes relating to cosmetics, skincare and associated goods and services. The application was rejected on the basis that the mark was devoid of distinctive character and acquired distinctiveness through use had not been demonstrated.
In May 2009 the Board of Appeal determined that the mark NATURALLY ACTIVE was a "mere promotional indication of a laudatory nature". Even if the mark was not purely descriptive of the goods and services covered, it did not necessarily follow that the mark had sufficient distinctive character within the meaning of Article 7.1(b) of Regulation 207/2009 (the "CTMR"). As to acquired distinctiveness, evidence obtained from the United Kingdom and Ireland was not enough to satisfy the requirements of Article 7.3 CTMR.
LEL appealed to the General Court, arguing that the mark NATURALLY ACTIVE is, in fact, inherently distinctive and that adequate evidence of acquired distinctiveness through use had been provided.
Article 7.1(b) CTMR prevents the registration of signs that are incapable of performing the essential function of a trade mark, namely to identify the origin of the goods and services in question. Very often marks that also function as marketing slogans or promotional phrases fall foul of this prohibition (the famous example is Nestlé's HAVE A BREAK, although on appeal to the ECJ it was eventually registered).
The distinctive character of a mark is also assessed by reference to the perception of the mark by the relevant public, in this case the average consumer, who is reasonably well informed, observant and circumspect and, crucially, a European English–speaker.
In considering the relevant public, the General Court noted that it is not merely residents of the UK and Ireland that speak English – there is a basic understanding of the English language across Europe and, in particular, in the Scandinavian countries, the Netherlands and Finland. Further, English is one of the official languages of both Malta and Cyprus. As a result the relevant public for the purposes of this application was far broader than simply the UK and Ireland.
The General Court went on to determine that those European English-speakers would, as OHIM had concluded, understand NATURALLY ACTIVE as meaning "something that acts or works in a not artificial way". As a result the mark applied for was no more than a promotional indication that could apply to any goods or services relating to cosmetics or beauty care; such a generic, laudatory phrase could not be reserved for one undertaking alone.
Evidence of use
If it follows that, if the relevant consumers for assessing distinctiveness are European English-speakers, then the UK and Irish evidence presented by LEL was insufficient to show acquired distinctiveness through use for the purposes of Article 7.3 CTMR.
Further, the General Court declined to take into account certain new evidence filed by LEL as part of this appeal – it noted that the role of the General Court was to review the legality of the Board of Appeal's decision and not to review the facts in light of new evidence presented to it.
LEL's appeal was rejected, other than in relation to goods in class 18, namely bags of various sorts. Whilst NATURALLY ACTIVE was not distinctive in relation to cosmetic products and services, the class 18 goods were considered ancillary to the main products being sold under the mark. The Board of Appeal had failed to draw a distinction between those ancillary goods and those directly related to cosmetic products and services. As a result the appeal in respect of class 18 was successful and that portion of the application can now proceed to advertisement.
Why this matters:
This case is a good reminder for brand owners that, notwithstanding a product's outstanding success in the UK, the CTM jurisdiction covers 27 Member States and a variety of languages and so a successful registration based on acquired distinctiveness is not a foregone conclusion. Where the mark applied for is not obviously distinctive, or has slogan-type qualities, significant work will need to be done to produce evidence of acquired distinctiveness in countries other than the UK and Ireland. The alternative course is to seek national protection in territories where trade has been ongoing, whilst building up use in those other jurisdictions, before making a CTM application.
This judgment also shows that the General Court will strictly construe the prohibition on registration that prevents laudatory and promotional – type phrases from being registered absent a significant degree of evidence, which evidence will be time consuming and expensive to produce. This case also reminds us that applicants must put in evidence at the appropriate time.
Whilst it is possible to submit new evidence to the Board of Appeal, it is not then possible to continue to produce evidence at the General Court stage. Applicants must have identified and submit the evidence they need at an earlier stage.