Joined Cases T-124/02 and T-156/02

The Sunrider Corp.

v

Office for Harmonisation in the Internal Market (Trade Marks and Designs) (OHIM)

(Community trade mark – Regulations (EC) Nos 40/94 and 2868/95 – Costs of opposition proceedings – Partial withdrawal of the trade mark application – Withdrawal of opposition – Reimbursement of appeal fees – Duty to state reasons)

Summary of the Judgment

1.      Community trade mark – Procedural requirements – Apportionment of costs – Withdrawal of a procedural measure rendering it devoid of purpose – Application of Article 81(3) of Regulation No 40/94 as a lex specialis that prevails over paragraph 4 of that article – Whether a withdrawal arising as the result of an agreement between the parties or not – Not relevant

(Council Regulation No 40/94, Art. 81(3) and (4))

2.      Community trade mark – Procedural requirements – Apportionment of costs – Opposition proceedings – Abandonment by one party of his claims – Similarity to a losing party – Exception – Situations referred to in Article 81(2) of Regulation No 40/94 – Ability of OHIM to carry out an apportionment taking reasons of equity into consideration – Wide margin of discretion

(Council Regulation No 40/94, Art. 81(1) to (3))

3.      Community trade mark – Procedural requirements – Apportionment of costs – Opposition proceedings – Partial abandonment by the parties of their claims – Ability of OHIM to carry out an apportionment taking reasons of equity into consideration – Wide margin of discretion – Assessment of the merits of the opposition – No need

(Council Regulation No 40/94, Art. 81(1) to (3))

4.      Community trade mark – Appeals procedure – Reimbursement of appeal fees in the event of substantial procedural violation – Decision taken by OHIM on its own initiative – Obligations of OHIM – Limits

(Commission Regulation No 2868/95, Art. 1, Rule 51)

5.      Community trade mark – Procedural requirements – Duty to give reasons for a decision – First sentence of Article 73 of Regulation No 40/94 – Same scope as that of Article 253 EC

(Art. 253 EC; Council Regulation No 40/94, Art. 73, first sentence)

1.      Article 81(3) of Regulation No 40/94 on the Community trade mark constitutes a lex specialis in relation to Article 81(4), since Article 81(3) covers cases in which the proceedings become devoid of purpose as a result of the unilateral withdrawal of a procedural measure while Article 81(4) of Regulation No 40/94 applies more generally to all cases which do not proceed to judgment. Article 81(3) also applies where, in inter partes proceedings, each party withdraws the procedural measure which it has filed. It is irrelevant in that connection, for the purposes of applying that provision, whether or not the withdrawal of the procedural measure or measures arose as a result of a side-agreement between the parties to the proceedings in question.

(see paras 37-39)

2.      It follows from Article 81(1) and (3) of Regulation No 40/94 on the Community trade mark that, where a party brings opposition proceedings to an end by abandoning his claims, in particular by withdrawing the trade mark application or the opposition, it is similar to a losing party and therefore must in principle bear the fees and costs incurred by the other party. The only exception to that rule is where Article 81(2) of Regulation No 40/94 applies, which states that ‘where each party succeeds on some and fails on other heads, or if reasons of equity so dictate, the Opposition Division, Cancellation Division or Board of Appeal shall decide a different apportionment of costs’. Whilst that provision envisages two distinct cases giving rise to a division of costs different from that laid down by Article 81(1), it does not preclude those two cases occurring simultaneously. Thus, where the costs are divided on the basis that each party succeeds on some and fails on other heads, the Office for Harmonisation in the Internal Market (Trade Marks and Designs) may take into consideration reasons of equity where a division which fails to take account of the relative success of the heads of claim leads to an inequitable outcome. Accordingly, OHIM enjoys a wide margin of discretion in the actual division of costs between the parties.

(see paras 53-54)

3.      When, in opposition proceedings brought against the registration of a Community trade mark under Article 42 et seq. of Regulation No 40/94, the trade mark application is partially withdrawn and the opposition to that application is also partially withdrawn in so far as the opposition proceedings have not already become devoid of purpose following the restriction of the trade mark application, each party partially abandons its claims. That situation must be equated to that in which each party succeeds on some and fails on other heads covered by Article 81(2) of Regulation No 40/94.

In that respect, the Opposition Division and the Board of Appeal may have regard to equity when making their decision on the actual division of the costs between the parties since they have a wide margin of discretion in that regard.

In that regard, in dividing the costs between the parties, the Opposition Division and the Board of Appeal are not required, even summarily, to assess the chances of each party prevailing in those proceedings. It would be contrary to procedural economy to assess the merits of the opposition solely for the purposes of dividing the costs.

(see paras 55-58)

4.      It is clear from the wording of Rule 51 of Regulation No 2868/95 implementing Regulation No 40/94 on the Community trade mark according to which the reimbursement of appeal fees is to be ordered in the event of interlocutory revision or where an appeal is deemed to be allowable, if it is equitable by reason of a substantial procedural violation, that the decision to order reimbursement of the appeal fees is made automatically without the need for the party bringing the appeal before the Office for Harmonisation in the Internal Market (Trade Marks and Designs) to include any such claim in the form of order it seeks.

That does not mean however that the Board of Appeal is required every time it annuls a decision to consider, of its own initiative, whether that decision is flawed by a substantial procedural violation such as to justify the application of that rule. Such an obligation cannot arise either from an application for reimbursement of the appeal fee made by a party where that application is unsupported by specific allegations to the effect that there has been a substantial procedural violation.

(see paras 69-70)

5.      Under the first sentence of Article 73 of Regulation No 40/94 on the Community trade mark, decisions of the Office for Harmonisation in the Internal Market (Trade Marks and Designs) are to state the reasons on which they are based. That duty has the same scope as that enshrined in Article 253 EC.

In that regard, the duty to give reasons for a decision has two purposes: to allow interested parties to know the justification for the measure so as to enable them to protect their rights and to enable the Community judicature to exercise its power to review the legality of the decision. Whether a statement of reasons satisfies those requirements is a question to be assessed with reference not only to its wording but also to its context and the whole body of legal rules governing the matter in question.

(see paras 72-73)