Although trademarks may well coexist peacefully in some markets it is not always the case in other countries where their origin is less well known. This is illustrated by a recent dispute heard by the Supreme Court between two trademarks for butter and margarine from county Kerry in Ireland.
The two trademarks, Kerrygold and Kerrymaid, coexist without confusion in the United Kingdom and Ireland; however, this is not the case in other jurisdictions like Spain, where the Spanish High Court has just ruled that a non-English speaking public might well confuse them.
This case in particular concerned the Irish company Ornua Co-operative Ltd. (Ornua) -see the related article here– and the Spanish company Tindale & Stanton Ltd. España SL (Tindale), the Spanish distributor of Kerrymaid margarine.
Who is who?
Ornua is an Irish company founded in 1961, which produces and sells dairy products under a number of different trademarks such as Kerrygold, Dubliner or Pilgrims Choice. Its flagship brand, Kerrygold butter, produced with milk from Irish cows and marketed since 1962, is one of biggest exports to the European Union (EU). Ornua holds, among other marks, the EU trademarks which protect both “KERRYGOLD” and the signs:
Tindale, is the Spanish distributor of Kerrymaid, a margarine made with whey. This margarine is produced by the Irish company Keery Group Plc, founded in 1972 and which has also registered, among other marks, the EU trademarks that protect the following sign:
The origin of the dispute
Ornua filed a trademark infringement claim against Tindale, but the Commercial Court of Alicante dismissed the case holding that:
- The signs in conflict coincide in the term “Kerry” a county in Ireland which is well known as a tourist destination and for its dairy industry, while the remaining elements of the mark are phonetically, graphically and conceptually different.
- The marks coexisted peacefully in the United Kingdom (which at the time of the judgment was still a member of the EU) and Ireland, both representing sufficiently important markets in the EU.
- Therefore, taking into account the unitary character of the trademark, the lack of any likelihood of confusion in the United Kingdom and Ireland could be extrapolated to the remaining countries of the Union.
- Furthermore, there was no misuse of the distinctive nature or reputation of Kerrygold. Kerrymaid had been using its trademark in Ireland for over 20 years, considering this to be just cause.
The Provincial Court of Alicante, in addition to confirming dismissal of the claim filed a request for a preliminary ruling at the Court of Justice of the European Union (CJEU), which, in its decision of 20 July 2017 (C-93/16), has ruled once again on the unitary nature of the EU trademark and the possible effects of tolerance. The CJEU held that:
- The fact that both trademarks coexist in a specific territory of the EU does not in itself mean that there is no likelihood of confusion in the remaining countries of the Union.
- Similarly, the fact that the trademark is well known in an EU state in which it peacefully coexists with another sign does not prevent infringement of that trademark in another territory.
- Furthermore, it cannot be concluded that there is just cause merely on grounds that the well-known trademark coexists peacefully with a sign in a part of EU territory.
- The EU Trademark Court should assess the circumstances of that peaceful coexistence, provided that the market conditions and the sociocultural circumstances do not differ significantly in the EU territories involved.
- That is, the EU Trademark Court hearing a case could prohibit the use of the conflicting sign throughout EU territory, with the exception of that part of the Union which has confirmed that there is no likelihood of confusion (i.e. because there is peaceful coexistence in that state).
It is worth noting that the Chamber did not take into account the coexistence of the signs, considering that the claim was filed against the Spanish distributor and not against Kerry Group Plc.
Finally, the Supreme Court in its recent judgment of November 10, 2021 laid down the guidelines for assessing the likelihood of confusion:
- When the public believes that the goods and services derive from the same company or related businesses;
- The relevant public is the average consumer of the goods or services in question:
- It is necessary to carry out an overall assessment of all the factors and circumstances of the case, rather than artificially breaking down the signs into separate elements; and
- When comparing the signs, it is important to take into account the fact that relevant consumers will trust the imperfect image that they have retained in their minds.
Having established this, the Spanish High Court, citing a judgment of the EU General Court, which also involved the parties (T-693/21), confirmed that there was a likelihood of confusion, and therefore, trademark infringement. Thus, the Supreme Court considered that the pertinent non-English speaking public would not recognize the reference to “Kerry” as a geographic indication of the product’s origin. The fact that both signs share this element, which is placed prominently at the beginning of the sign, as well having as a similar structure, would be sufficient to lead consumers to think that Kerrymaid was a trademark relating to the Kerrygold goods.
As may be seen, the unitary nature of the EU trademark is not so uniform. The fact that some brands coexist in some markets does not mean that the trademark holders are forcibly required to coexist in the rest. This notwithstanding, the circumstances of this coexistence should be taken into consideration when determining whether or not the trademark has been infringed. Finally, this national tolerance may be alleged as a defense in trademark infringement actions, the so-called “intervening right” (see article 16 of the EU Trademark Regulation and related article here). However, this defense warrants another blog entry all of its own.
Intellectual Property Department