JUDGMENT OF THE GENERAL COURT (Third Chamber)
19 October 2022 (*)
(EU trade mark – Invalidity proceedings – EU figurative mark Swisse – Absolute grounds for invalidity – Article 51(1)(a) and (b) of Regulation (EC) No 40/94 (now Article 59(1)(a) and (b) of Regulation (EU) 2017/1001) – No distinctive character – Trade mark of such a nature as to deceive the public – State emblem – Trade mark including badges, emblems or escutcheons – Article 7(1)(b), (g), (h) and (i) of Regulation No 40/94 (now Article 7(1)(b), (g), (h) and (i) of Regulation 2017/1001) – Bad faith – Statement of reasons for the application for a declaration of invalidity – Article 63(2) of Regulation 2017/1001 – Scope of the examination which has to be carried out by EUIPO – Article 95(1) of Regulation 2017/1001 – Right to be heard – Article 41 of the Charter of Fundamental Rights)
In Case T‑486/20,
Health and Happiness (H&H) Hong Kong Ltd, established in Hong Kong (China), represented by D. Rose and L. Flascher, Solicitors, and N. Saunders KC,
applicant,
v
European Union Intellectual Property Office (EUIPO), represented by J. Ivanauskas and V. Ruzek, acting as Agents,
defendant,
the other party to the proceedings before the Board of Appeal of EUIPO, intervener before the General Court, being
Giuliani SpA, established in Milan (Italy), represented by S. de Bosio, lawyer,
THE GENERAL COURT (Third Chamber),
composed, at the time of the deliberations, of G. Steinfatt (Rapporteur), acting as President, K. Kecsmár and S. Kingston, Judges,
Registrar: A. Juhász‑Tóth, Administrator,
having regard to the written part of the procedure,
having regard to the order of 16 September 2021, H&H v EUIPO – Giuliani (Swisse) (T‑486/20, not published, EU:T:2021:619), by which the Court (Third Chamber) dismissed the intervener’s cross-claim as inadmissible,
further to the hearing on 28 April 2022,
gives the following
Judgment
1 By its action under Article 263 TFEU, the applicant, Health and Happiness (H&H) Hong Kong Ltd, seeks the annulment of the decision of the Fifth Board of Appeal of the European Union Intellectual Property Office (EUIPO) of 25 May 2020 (Case R 2185/2019‑5) (‘the contested decision’).
Background to the dispute
2 On 9 March 2018, the intervener, Giuliani SpA, filed with EUIPO an application for a declaration of invalidity of the EU trade mark which had been registered following an application filed on 2 July 2003 by Swisse Vitamins Pty Ltd, the predecessor in law to the applicant, in respect of the following figurative sign:
3 The goods covered by the contested mark in respect of which a declaration of invalidity was sought are in Class 5 of the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks of 15 June 1957, as revised and amended, and correspond to the following description: ‘Vitamins, vitamin preparations, herbal formulations, mineral supplements and nutritive elements including vitamins, minerals, nutritive elements and herbal formulations in capsule, tablet and liquid form’.
4 As grounds for invalidity, the intervener selected Article 7(1)(b), (g), (h) and (i) of Regulation (EU) 2017/1001 of the European Parliament and of the Council of 14 June 2017 on the European Union trade mark (OJ 2017 L 154, p. 1) from the drop-down menu on EUIPO’s standard application for a declaration of invalidity form (‘the form’). Furthermore, it referred, in the explanation of grounds section of that form, to Article 59(1)(b) of that regulation.
5 On 26 July 2019, the Cancellation Division declared the contested mark invalid. It found, in essence, that that mark was devoid of any distinctive character and that it was not necessary to examine the other grounds for invalidity relied on.
6 On 26 September 2019, the applicant filed a notice of appeal with EUIPO against the Cancellation Division’s decision.
7 By the contested decision, the Board of Appeal dismissed the appeal. It examined the ground for invalidity set out in Article 51(1)(a) of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark (OJ 1994 L 11, p. 1), read in conjunction with Article 7(1)(b) of that regulation. It found that the Cancellation Division had been right in upholding the application for a declaration of invalidity on the basis of the latter provision, since it was clear from the arguments and evidence before it that the contested mark would not be regarded as indicative of a commercial origin, but rather as an indication that the goods came from Switzerland. According to the Board of Appeal, such information was devoid of any distinctive character. Furthermore, it took the view that the Cancellation Division had correctly found that it was not necessary to assess the alleged deceptiveness of the contested mark. Lastly, the Board of Appeal stated that it shared the applicant’s view that the remaining grounds for invalidity relied on by the intervener were inchoate. However, it concluded that that finding had no bearing in the present case, since it was endorsing the Cancellation Division’s decision on the basis of Article 7(1)(b) of Regulation No 40/94.
Forms of order sought
8 The applicant claims that the Court should:
– annul the contested decision;
– order EUIPO to pay the costs of the main proceedings.
9 EUIPO contends that the Court should:
– dismiss the action;
– order the applicant to pay the costs of the main proceedings.
10 The intervener contends that the Court should:
– dismiss the main action as inadmissible and, in any event, as unfounded;
– confirm the declaration of invalidity of the contested mark either on the basis of Article 7(1)(g) of Regulation No 40/94 or on the basis of one of the other grounds for invalidity invoked.
Law
Admissibility
The issue of whether the main action is admissible
11 The intervener submits that, since the applicant’s lawyers are authorised to practise before the courts of England and Wales, which are parts of the United Kingdom, and not before the courts of a Member State of the European Union, they cannot represent it in the present action, with the result that that action is inadmissible.
12 As was held in paragraph 16 of the order of 16 September 2021, H&H v EUIPO – Giuliani (Swisse) (T‑486/20, not published, EU:T:2021:619), since the action was brought on 3 August 2020, that is to say, before the end of the transition period which was set, under Article 126 of the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (OJ 2020 L 29, p. 7), at 31 December 2020, the applicant’s lawyers, who are authorised to practise before the courts of England and Wales, which are parts of the United Kingdom, may, under Article 91(1) and (3) of that agreement, continue to represent the applicant in the present action and must in all respects be treated as lawyers authorised to practise before the courts of the Member States who represent or assist a party before the Court of Justice of the European Union.
13 The applicant’s plea of inadmissibility must therefore be rejected.
The issue of whether the intervener’s second head of claim is admissible
14 By its second head of claim, the intervener requests that the declaration of invalidity of the contested mark be confirmed either on the basis of Article 7(1)(g) of Regulation No 40/94 or on the basis of one of the other grounds for invalidity invoked.
15 It must be held that, by that head of claim, the applicant is seeking to obtain a declaratory judgment from the Court. It follows, however, from Article 72(2) and (3) of Regulation 2017/1001 that an action brought before the Court under those provisions seeks to have the legality of decisions of the Boards of Appeal examined and to obtain, as the case may be, the annulment or alteration of those decisions, with the consequence that such an action cannot have the objective of obtaining confirmatory or declaratory judgments in respect of those decisions (see judgment of 10 June 2008, Gabel Industria Tessile v OHIM – Creaciones Garel (GABEL), T‑85/07, EU:T:2008:186, paragraph 17 and the case-law cited).
16 Furthermore, since the Board of Appeal did not rule on any grounds for refusal other than that laid down in Article 7(1)(b) of Regulation No 40/94 (order of 16 September 2021, Swisse, T‑486/20, not published, EU:T:2021:619, paragraph 40), it is not for the Court, in its review of the legality of the contested decision, to rule on an issue which was not examined by the Board of Appeal (see, to that effect, judgment of 29 March 2012, You-Q v OHIM – Apple Corps (BEATLE), T‑369/10, not published, EU:T:2012:177, paragraph 75 and the case-law cited).
17 In any event, in so far as the intervener’s second head of claim must be interpreted as seeking the alteration of the contested decision, it must be borne in mind that the power of the General Court to alter decisions pursuant to Article 72(3) of Regulation 2017/1001 does not have the effect of conferring on that Court the power to substitute its own reasoning for that of a Board of Appeal or to carry out an assessment on which that Board of Appeal has not yet adopted a position. Exercise of the power to alter decisions must therefore, in principle, be limited to situations in which the General Court, after reviewing the assessment made by the Board of Appeal, is in a position to determine, on the basis of the matters of fact and of law as established, what decision the Board of Appeal was required to take (judgment of 5 July 2011, Edwin v OHIM, C‑263/09 P, EU:C:2011:452, paragraph 72). The Board of Appeal did not assess any grounds for invalidity other than that derived from the lack of distinctive character of the contested mark.
18 Consequently, the intervener’s second head of claim must be rejected as inadmissible.
The issue of whether the evidence submitted for the first time before the Court is admissible
19 EUIPO contends that Annex A 14 to the application was submitted for the first time before the Court, with the result that the documents which it contains are inadmissible.
20 At the hearing, the applicant admitted that those documents had not been submitted in the proceedings before EUIPO.
21 Those documents were therefore submitted for the first time before the Court. The purpose of actions before the Court is to review the legality of decisions of the Boards of Appeal of EUIPO for the purposes of Article 72 of Regulation 2017/1001, so it is not the Court’s function to review the facts in the light of documents produced for the first time before it. Accordingly, those documents must be excluded and there is no need to assess their probative value (see, to that effect, judgment of 24 November 2005, Sadas v OHIM – LTJ Diffusion (ARTHUR ET FELICIE), T‑346/04, EU:T:2005:420, paragraph 19 and the case-law cited).
Substance
22 It must be pointed out at the outset that, in view of the date on which the application for registration in question was filed, namely 2 July 2003, which is decisive for the purposes of identifying the applicable substantive law, the facts of the case are governed by the substantive provisions of Regulation No 40/94 (see, to that effect, order of 5 October 2004, Alcon v OHIM, C‑192/03 P, EU:C:2004:587, paragraphs 39 and 40, and judgment of 23 April 2020, Gugler France v Gugler and EUIPO, C‑736/18 P, not published, EU:C:2020:308, paragraph 3 and the case-law cited). Furthermore, since, according to settled case-law, procedural rules are generally held to apply on the date on which they enter into force (see judgment of 11 December 2012, Commission v Spain, C‑610/10, EU:C:2012:781, paragraph 45 and the case-law cited), the case is governed by the procedural provisions of Regulation 2017/1001, of Commission Delegated Regulation (EU) 2018/625 of 5 March 2018 supplementing Regulation 2017/1001, and repealing Delegated Regulation (EU) 2017/1430 (OJ 2018 L 104, p. 1), and of Commission Implementing Regulation (EU) 2018/626 of 5 March 2018 laying down detailed rules for implementing certain provisions of Regulation 2017/1001, and repealing Implementing Regulation (EU) 2017/1431 (OJ 2018 L 104, p. 37).
23 As regards the substantive rules, the references made by the Board of Appeal in the contested decision and by the parties to the present case to Article 7(1)(b), (g), (h) and (i) of Regulation 2017/1001 or of the ‘European Union Trade Mark Regulation’, or even of the ‘EUTMR’, and to Article 59(1)(a) and (b) of Regulation 2017/1001 must be understood as referring to Article 7(1)(b), (g), (h) and (i) of Regulation No 40/94 and to Article 51(1)(a) and (b) of Regulation No 40/94 respectively, which are substantively identical.
24 The applicant puts forward three pleas in law, alleging infringement, first, of Article 63(2) and Article 95(1) of Regulation 2017/1001, secondly, of Article 41 of the Charter of Fundamental Rights of the European Union (‘the Charter’) and, thirdly, of essential procedural requirements because of the lack of any translation of arguments which were put forward in the written pleading submitted before EUIPO and of annexes and because the evidence submitted in support of the application for a declaration of invalidity postdates the filing date of the contested mark. In the context of the first two pleas, it also claims that the Board of Appeal should have found that the Cancellation Division and it itself were not competent to annul the contested mark on the basis of a lack of distinctive character.
25 Since the first two pleas and the argument disputing the Board of Appeal’s competence to annul the contested mark on the basis of its lack of distinctive character relate, in essence, to the applicant’s contention that Article 7(1)(b) of Regulation No 40/94 could not be used as a ground for declaring the contested mark invalid, it is appropriate to examine them together.
26 In the first place, the applicant submits that, for the purposes of filing the application for a declaration of invalidity of the contested mark, the intervener used the form and submitted a written pleading accompanied by a number of items of evidence in support. It argues that, although the intervener stated Article 7(1)(b), (g), (h) and (i) of Regulation No 40/94 under the heading ‘selected ground number 1’ on the form, the explanation of grounds which appears on that form, as well as the detailed statement in the application for a declaration of invalidity, confine themselves to requesting that the contested mark be declared invalid and to providing reasoning for that mark to be declared invalid on the basis of its misleading nature (Article 7(1)(g) of Regulation No 40/94), its registration in bad faith (Article 51(1)(b) of Regulation No 40/94) or the illegal exploitation of the name of a State (Article 7(1)(h) and (i) of Regulation No 40/94). The applicant thus submits that, although the intervener listed four grounds which are set out in Article 7(1) of Regulation No 40/94, it put forward reasoning only with regard to three of them, namely those referred to in Article 7(1)(g), (h) and (i), as well as with regard to bad faith. It claims that no reasoning was provided as regards the ground for invalidity set out in Article 7(1)(b) of Regulation No 40/94.
27 The applicant submits that, in its reply before the Cancellation Division, the intervener addressed only the misleading nature of the contested mark and bad faith.
28 It argues that, consequently, the intervener’s line of argument was that the contested mark was deceptive and misled the public, contrary to Article 7(1)(g) of Regulation No 40/94. It contends that that is shown by point II and the conclusion of the application for a declaration of invalidity.
29 It submits that the Cancellation Division also found that the intervener had argued that the contested trade mark was misleading as to the geographical origin of the relevant goods and that the applicant had registered it in bad faith. It claims that there is nothing to suggest that the applicant for a declaration of invalidity put forward an argument relating to Article 7(1)(b) of Regulation No 40/94 or submitted that the registration lacked distinctive character.
30 The applicant argues that, although it had contended that the Cancellation Division was not competent to consider the validity of the registration under Article 7(1)(b) of Regulation No 40/94, since the intervener had never relied on that ground for invalidity, the Board of Appeal erroneously found that the intervener had relied on that provision.
31 In the second place, the applicant submits that, since no reasoning was given with regard to the alleged lack of distinctiveness of the contested mark, the application for a declaration of invalidity, on which the adjudicating bodies of EUIPO relied, does not comply with Article 63(2) of Regulation 2017/1001.
32 Furthermore, it contends that, by declaring that mark invalid on account of its lack of distinctive character and by putting forward on their own initiative arguments on which the applicant had, moreover, never been in a position to present its comments, the two adjudicating bodies of EUIPO infringed Article 94(1) and Article 95(1) of Regulation 2017/1001 and also Article 41(1) and Article 41(2)(a) of the Charter.
33 The applicant equates the intervener’s failure to submit any arguments relating to Article 7(1)(b) of Regulation No 40/94 with an abandonment. It states that EUIPO is not competent to rule on pleas which the parties have abandoned because its examination must be limited to the grounds invoked and the requests presented by the parties.
34 In the third place, the applicant submits that those infringements resulted in its being denied the right, first, to demonstrate that the registration had acquired distinctive character through the use made of it prior to the commencement of the present invalidity proceedings and, secondly, to submit arguments in support of the position that the registration is not devoid of any distinctive character.
35 EUIPO and the intervener dispute the applicant’s arguments.
36 In the first place, the intervener submits that the plea alleging infringement of Article 63(2) and Article 95(1) of Regulation 2017/1001 and the plea alleging infringement of Article 41 of the Charter were put forward for the first time before the Court, with the result that they are inadmissible.
37 In the second place, EUIPO contends that the intervener’s online completion of the form satisfies the requirements laid down both in Article 63(2) of Regulation 2017/1001 and in Article 12(1) of Delegated Regulation 2018/625, since the intervener stated in that form that one of the grounds relied on was that set out in Article 7(1)(b) of Regulation No 40/94. The application for a declaration of invalidity was therefore duly filed and is admissible in so far as it was based on that ground.
38 The intervener submits, in essence, that, having regard to the date of registration of the contested mark, it is not Article 95(1) of Regulation 2017/1001 which applies, but rather Article 74(1) of Regulation No 40/94, which authorises EUIPO, in such proceedings, to go beyond not only the claims, but also the grounds and, a fortiori, the arguments put forward by the parties. It argues that, in any event, the ground for invalidity in Article 7(1)(b) was indeed set out in the application for a declaration of invalidity and it follows from the French and Italian versions of Article 95(1) of Regulation 2017/1001, that the Cancellation Division may, of its own motion, link the factual arguments and the evidence submitted by an applicant for a declaration of invalidity to any ground invoked by it, irrespective of whether that ground was specifically reiterated in the written pleadings and irrespective of whether the applicant for a declaration of invalidity has requested that the facts and arguments be specifically examined in the light of an absolute ground for invalidity.
39 According to EUIPO and the intervener, although, in the present case, the intervener did not separately put forward arguments relating to the ground for refusal set out in Article 7(1)(b) of Regulation No 40/94, the arguments and evidence which it submitted in the context of the other grounds invoked, in particular Article 7(1)(g) of that regulation, were also relevant for the purpose of assessing the application in the light of Article 7(1)(b) of that regulation, since those two grounds are closely linked. They submit that there can be an overlap between the respective scopes of some of the absolute grounds for refusal, including those set out in Article 7(1)(b) and (g) of Regulation No 40/94.
40 They argue that the fact that a lack of distinctive character can be overcome under Article 7(3) of Regulation No 40/94, whereas a misleading nature cannot be overcome, does not mean that those two grounds do not overlap.
41 They submit that, consequently, there has been no infringement of Article 95(1) of Regulation 2017/1001, as the examination of the application for a declaration of invalidity of the contested mark was limited to the grounds and arguments submitted by the parties. At the hearing, EUIPO, in essence, also contended that it is for the proprietor of a trade mark in respect of which an application for a declaration of invalidity has been filed to defend his or her registration with regard to all the grounds which have been relied on, although it recognised the difficulty in doing so in a situation such as that in the present case in which the applicant for a declaration of invalidity had not elaborated on each of the grounds.
42 For essentially the same reasons as those put forward with regard to the alleged infringement of Article 63(2) and Article 95(1) of Regulation 2017/1001, EUIPO and the intervener submit that there has been no infringement of Article 41 of the Charter. Furthermore, they contend that, in the light of the overlap between the absolute grounds for refusal set out in Article 7(1)(b) and (g) of Regulation No 40/94, the applicant, contrary to what it submits, was not required to guess the developments relating to the ground relied on by the adjudicating bodies of EUIPO.
43 On the one hand, the intervener submits that the applicant’s argument that the lack of any development of a ground, which was, however, put forward in the application for a declaration of invalidity of the contested mark, is tantamount to an abandonment of that ground is inadmissible, because it was not raised before the Board of Appeal. On the other hand, both EUIPO and the intervener raise objections as to the substance of that argument. First, according to EUIPO, the intervener has not abandoned the ground alleging that the contested mark is devoid of any distinctive character. It contends that the absence of any specific elaboration on that ground cannot give rise to such a presumption of withdrawal. Secondly, the intervener submits that that ground was supported by the arguments which it submitted, since the line of argument relating to Article 7(1)(g) of Regulation No 40/94 included lack of distinctive character. Thirdly, the intervener argues that the concept of abandonment cannot apply to absolute grounds for invalidity, which, in its view, relate to public policy, and that, in any event, EUIPO is authorised to go beyond the ‘demands’ and to examine the facts of its own motion.
44 In that regard, so far as concerns the pleas of inadmissibility which the intervener puts forward against, first, the plea alleging infringement of Article 63(2) and Article 95(1) of Regulation 2017/1001, secondly, the plea alleging infringement of Article 41 of the Charter and, thirdly, the argument that the lack of any development of a ground for refusal of registration is to be equated with the withdrawal of such a ground, it must be borne in mind that the purpose of actions before the Court is to review of the legality of decisions of the Boards of Appeal of EUIPO for the purposes of Article 72 of Regulation 2017/1001 and that Article 188 of the Rules of Procedure of the General Court provides that the parties’ pleadings may not change the subject matter of the proceedings before the Board of Appeal (judgment of 12 November 2015, CEDC International v OHIM – Fabryka Wódek Polmos Łańcut (WISENT), T‑449/13, not published, EU:T:2015:839, paragraph 26).
45 Consequently, the Court’s review cannot go beyond the factual and legal context of the dispute as it was brought before the Board of Appeal (judgment of 22 June 2004, ‘Drie Mollen sinds 1818’ v OHIM – Nabeiro Silveria (Galáxia), T‑66/03, EU:T:2004:190, paragraph 45). Likewise, the applicant does not have the power to alter before the Court the terms of the dispute as delimited in the respective claims and allegations submitted by itself and by the intervener (judgments of 26 April 2007, Alcon v OHIM, C‑412/05 P, EU:C:2007:252, paragraph 43, and of 18 December 2008, Les Éditions Albert René v OHIM, C‑16/06 P, EU:C:2008:739, paragraph 122).
46 In the present case, it must be stated that the applicant, before the Board of Appeal, clearly relied on and provided reasoning with regard to the Cancellation Division’s infringement of Article 63(2) and Article 95(1) of Regulation 2017/1001 and Article 41 of the Charter.
47 As regards the applicant’s argument that, in essence, the lack of any development of a ground for refusal ought to be analysed as a withdrawal of that ground (see paragraph 33 above), it must be pointed out that that argument is part of an extension of the applicant’s line of argument, both in its appeal before the Board of Appeal and before the Court, by which it sought to show that the Board of Appeal was not entitled to examine the validity of the contested mark in the light of Article 7(1)(b) of Regulation No 40/94, and it constitutes an amplification of that line of argument (judgments of 28 June 2012, I Marchi Italiani and Basile v OHIM – Osra (B. Antonio Basile 1952), T‑133/09, EU:T:2012:327, paragraph 17, and of 3 May 2018, Laboratoires Majorelle v EUIPO – Jardin Majorelle (LABORATOIRES MAJORELLE), T‑429/17, not published, EU:T:2018:250, paragraph 27).
48 The pleas and arguments at issue do not therefore go beyond the factual and legal context of the dispute as it was brought before the Board of Appeal. They also do not alter the terms of the dispute.
49 The pleas of inadmissibility must therefore be rejected.
50 As regards the substance of the case, it is true that the intervener selected the ground of Article 7(1)(b) of Regulation No 40/94 from the drop-down menu on the form. However, as the applicant submits and as the other parties, moreover, acknowledge, the intervener did not put forward any reasoning seeking specifically to show that the contested mark lacked distinctive character.
51 First, the explanation of grounds for invalidity on the form is worded as follows: ‘Giuliani spa requests EUIPO to declare EU figurative trade mark 003252152 null and void on grounds of its misleading character (article 7, paragraph 1, letter g [EUTMR]), and/or registration in bad faith (article 59, paragraph 1, letter b, [EUTMR]) and/or illegal exploitation of the name of State (article 7, paragraph 1, letter h) and i), [EUTMR]). …’
52 Secondly, the intervener did not refer to Article 7(1)(b) of Regulation No 40/94 and also did not claim, and even less provided reasoning, that that mark was not capable of performing the essential function of a trade mark according to that regulation, namely that of designating the commercial origin of the goods at issue.
53 The detailed statement is exclusively focusing on the grounds for refusal in Article 7(1)(g), (h) and (i) of Regulation No 40/94 and on bad faith. The reminder as to the provisions which are applicable with regard to the grounds for refusal relied on by the intervener, which are referred to in point III of that statement, does not contain Article 7(1)(b) of Regulation No 40/94, of Council Regulation (EC) No 207/2009 of 26 February 2009 on the European Union trade mark (OJ 2009 L 78, p. 1), or of Regulation 2017/1001.
54 Thirdly, in the conclusion to its detailed statement, the intervener requests EUIPO to declare the contested mark null and void on the grounds of its misleading nature (Article 7(1)(g) of Regulation No 40/94) and/or its registration in bad faith (Article 51(1)(b) of Regulation No 40/94) and/or its illegal exploitation of the name of a State (Article 7(1)(h) and (i) of Regulation No 40/94).
55 Fourthly, the intervener did not, in its application for a declaration of invalidity, draw any conclusion with regard to the lack of distinctive character of that mark from the alleged infringement of the other provisions on which it relied.
56 Fifthly, in the reply before the Cancellation Division, the intervener also did not refer to the lack of distinctive character of the contested mark or the corresponding provision, but claimed solely that the contested mark was deceptive and had been registered in bad faith.
57 Accordingly, the Board of Appeal infringed Article 63(2) and Article 95(1) of Regulation 2017/1001 and also Article 41 of the Charter.
58 In the first place, it is settled case-law that there is a degree of overlap between the respective scopes of the absolute grounds for refusal to register a trade mark set out in Article 7(1)(b) to (d) of Regulation No 40/94 (judgments of 30 November 2011, Hartmann v OHIM (Complete), T‑123/10, not published, EU:T:2011:706, paragraph 39, and of 16 May 2013, Restoin v OHIM (EQUIPMENT), T‑356/11, not published, EU:T:2013:253, paragraph 53).
59 As regards the absolute grounds for refusal set out in Article 7(1)(b) and (g) of Regulation No 40/94, it must be stated that a degree of overlap between their respective scopes may be deduced from the judgments of 5 May 2011, SIMS – École de ski internationale v OHIM – SNMSF (esf école du ski français) (T‑41/10, not published, EU:T:2011:200, paragraphs 49 and 50 and the case-law cited), and of 27 October 2016, Caffè Nero Group v EUIPO (CAFFÈ NERO) (T‑37/16, not published, EU:T:2016:634, paragraph 52), since it has been held that a trade mark is incapable of fulfilling its essential function of guaranteeing the identity of origin of the goods or services covered by the mark to the consumer or end user by enabling him or her, without any possibility of confusion, to distinguish those goods or services from others which have another origin where the information it contains is of such a nature as to deceive the public.
60 However, it is clear from equally settled case-law that each of the grounds for refusal to register listed in Article 7(1) of Regulation No 40/94 is independent of the others and requires separate examination (judgments of 16 January 2013, Spectrum Brands (UK) v OHIM – Philips (STEAM GLIDE), T‑544/11, not published, EU:T:2013:20, paragraph 45; of 16 May 2013, EQUIPMENT, T‑356/11, not published, EU:T:2013:253, paragraph 53; and order of 12 February 2021, sprd.net v EUIPO – Shirtlabor (I love), T‑19/20, not published, EU:T:2021:89, paragraph 80).
61 Furthermore, those grounds for refusal must be interpreted in the light of the public interest underlying each of them (see judgment of 7 May 2019, Fissler v EUIPO (vita), T‑423/18, EU:T:2019:291, paragraph 64 and the case-law cited). The public interest taken into account in the examination of those grounds for refusal may, or even must, reflect different considerations, depending upon which ground for refusal is at issue (judgments of 20 October 2021, Square v EUIPO ($ Cash App), T‑210/20, not published, EU:T:2021:711, paragraph 20, and of 20 October 2021, Square v EUIPO ($ Cash App), T‑211/20, not published, EU:T:2021:712, paragraph 21).
62 It has also been held that to deduce that a trade mark lacks distinctive character solely from the fact that it is descriptive constitutes an error in law (judgments of 8 May 2008, Eurohypo v OHIM, C‑304/06 P, EU:C:2008:261, paragraphs 58 to 63; of 18 March 2016, Grupo Bimbo v OHIM (BIMBO), T‑33/15, not published, EU:T:2016:159, paragraphs 63 and 64; and of 20 October 2021, $ Cash App, T‑210/20, not published, EU:T:2021:711, paragraphs 22 and 26). By analogy, to deduce that a trade mark lacks distinctive character solely from the fact that its registration is contrary to the absolute grounds for refusal in Article 7(1)(g), (h) or (i) of Regulation No 40/94 also constitutes an error in law. That is particularly so because the possibility, laid down by Article 7(3) of Regulation No 40/94, of overcoming a ground for refusal set out in Article 7(1)(b), (c) and (d) of that regulation by the acquisition of distinctive character through use of the mark at issue in relation to the goods or services for which registration is requested does not extend to the other absolute grounds for refusal.
63 Consequently, the overlap between the absolute grounds for refusal set out in Article 7(1) of Regulation No 40/94 cannot compensate for the total lack of any arguments in relation to one of the grounds for refusal on the part of the applicant for a declaration of invalidity.
64 In the present case, it has already been stated that the application for a declaration of invalidity contained reasoning exclusively with regard to the grounds for refusal set out in Article 7(1)(g), (h) and (i) of Regulation No 40/94 and with regard to bad faith and does not contain any specific argument relating to the alleged lack of distinctive character of the contested mark. The intervener also did not refer to the public interest objective which underlies the absolute ground for refusal set out in Article 7(1)(b) of Regulation No 40/94, namely that of guaranteeing the identity of origin of the goods or services covered by the mark to the consumer or end user by enabling him or her, without any possibility of confusion, to distinguish those goods or services from others which have another origin (see judgment of 30 June 2011, Imagion v OHIM (DYNAMIC HD), T‑463/08, not published, EU:T:2011:318, paragraph 18 and the case-law cited).
65 What is more, on the one hand, as has been stated in paragraphs 55 and 56 above, the intervener did not, either in its application for a declaration of invalidity or its reply before the Cancellation Division, draw any conclusion as regards the lack of distinctive character of the contested mark from the alleged infringement of the other grounds for refusal on which it relied. On the other hand, the Board of Appeal did not find that there had been infringement of Article 7(1)(g) of Regulation No 40/94.
66 Consequently, EUIPO and the intervener’s argument regarding the overlap between Article 7(1)(b) and (g) of Regulation No 40/94 cannot succeed.
67 In the second place, it is clear from Article 63(2) of Regulation 2017/1001 that an application for a declaration of invalidity must be filed in a written reasoned statement. Article 16(1)(a) of Delegated Regulation 2018/625, to which EUIPO also refers in its response, states that the applicant for a declaration of invalidity is to present the facts, evidence and arguments in support of the application up to the closure of the adversarial part of the invalidity proceedings. In particular, he or she is to provide facts, arguments and evidence to support the grounds on which the application for a declaration of invalidity is based. The applicant for a declaration of invalidity must therefore explain, by submitting arguments in his or her application or in his or her reply before the Cancellation Division, in what way the grounds on which he or she is basing its application apply in the present case. Article 17(3) of Delegated Regulation 2018/625 provides that where the applicant has not submitted the facts, arguments or evidence required to substantiate the application, the application is to be rejected as unfounded.
68 In the absence of any arguments, in the application for a declaration of invalidity, seeking to show that Article 7(1)(b) of Regulation No 40/94 applies, the applicant is right in claiming that the Board of Appeal infringed Article 63(2) of Regulation 2017/1001, because, even though the application contained no reasoning in that regard, the adjudicating bodies of EUIPO nevertheless relied on that ground.
69 Furthermore, it is clear from settled case-law that pleas must be interpreted in terms of their substance rather than of their classification (see judgments of 6 June 2019, Torrefazione Caffè Michele Battista v EUIPO – Battista Nino Caffè (BATTISTINO), T‑221/18, not published, EU:T:2019:382, paragraph 23 and the case-law cited, and of 28 May 2020, Workspace Group v EUIPO – Technopolis Holding (UMA WORKSPACE), T‑506/19, not published, EU:T:2020:220, paragraph 64). That rule is of general application and therefore also applies to applications for a declaration of invalidity submitted before EUIPO. In spite of the selection of Article 7(1)(b) of Regulation No 40/94 from the drop-down menu on the form, the substance of the arguments submitted by the intervener shows that it did not rely on the alleged lack of distinctive character of the contested mark, because the lack of distinctive character of the contested mark is not one of those arguments.
70 It is apparent from well-established case-law that, in order to determine the grounds on which an application for a declaration of invalidity is based, it is necessary to examine all of the application, especially in the light of the detailed statement of reasons in support of it (judgments of 24 March 2011, Cybergun v OHIM – Umarex Sportwaffen (AK 47), T‑419/09, not published, EU:T:2011:121, paragraph 21; of 18 March 2016, Karl-May-Verlag v OHIM – Constantin Film Produktion (WINNETOU), T‑501/13, EU:T:2016:161, paragraph 26; and of 9 December 2020, Promed v EUIPO – Centrumelektroniki (Promed), T‑30/20, not published, EU:T:2020:599, paragraph 27).
71 However, the intervener’s selection of the ground of Article 7(1)(b) of Regulation No 40/94 from the drop-down menu on the form is inconsistent with the explanation of grounds on the same form (see paragraphs 50 to 56 above), the detailed statement of reasons in support of the application and the conclusion to that detailed statement.
72 It must, moreover, be pointed out that the ground for invalidity based on bad faith is not among one of those which were selected from the drop-down menu, which did not, however, preclude the Cancellation Division, in accordance with the case-law cited in paragraph 70 above, from taking it into account, because it had been mentioned in the explanation of grounds and substantiated both in the detailed statement of reasons and in the conclusion.
73 In the third place, contrary to what the intervener submits (see paragraph 38 above), it is Article 95(1) of Regulation 2017/1001, and not Article 74(1) of Regulation No 40/94, which applies in the present case. First, as is apparent from paragraph 22 above, since procedural rules are generally held to apply on the date on which they enter into force, the case is governed by the procedural provisions of Regulation 2017/1001. Secondly, it has already been held that Article 95(1) of Regulation 2017/1001 is a procedural provision (judgment of 15 October 2020, smart things solutions v EUIPO – Samsung Electronics (smart:)things), T‑48/19, not published, EU:T:2020:483, paragraph 64). Article 212 of Regulation 2017/1001 states that that regulation is to apply from 1 October 2017, a date which even predates the filing of the application for a declaration of invalidity.
74 According to settled case-law, under Article 95(1) of Regulation 2017/1001, when examining absolute grounds for refusal following an application for registration, EUIPO examiners and, on appeal, the Boards of Appeal of EUIPO are required to examine the facts of their own motion in order to determine whether the mark in respect of which registration is sought comes under one of the absolute grounds for refusal of registration set out in Article 7 of that regulation. It follows that the competent bodies of EUIPO may be led to base their decisions on facts which have not been put forward by the trade mark applicant (see, to that effect, judgments of 29 March 2019, All Star v EUIPO – Carrefour Hypermarchés (Shape of a shoe sole), T‑611/17, not published, EU:T:2019:210, paragraph 43, and of 10 June 2020, Louis Vuitton Malletier v EUIPO – Wisniewski (Representation of a chequerboard pattern), T‑105/19, not published, EU:T:2020:258, paragraph 21).
75 By contrast, in invalidity proceedings based on an absolute ground for refusal, the Board of Appeal cannot be required to carry out afresh the examination of the relevant facts which the competent EUIPO bodies conducted, of their own motion, at the time of registration. It follows from the provisions of Articles 51 and 54 of Regulation No 40/94, now Articles 59 and 62 of Regulation 2017/1001, that the EU trade mark is regarded as valid until it has been declared invalid by EUIPO following invalidity proceedings. It therefore enjoys a presumption of validity, which is the logical consequence of the check carried out by EUIPO in the examination of an application for registration (see, to that effect, judgments of 29 March 2019, Shape of a shoe sole, T‑611/17, not published, EU:T:2019:210, paragraph 44, and of 10 June 2020, Representation of a chequerboard pattern, T‑105/19, not published, EU:T:2020:258, paragraph 22).
76 Consequently, in invalidity proceedings based on an absolute ground for refusal, as the registered EU trade mark is presumed to be valid, it is for the person who has filed the application for a declaration of invalidity to invoke before EUIPO the specific facts which call the validity of that trade mark into question. Thus, the second sentence of Article 95(1) of Regulation 2017/1001, which consolidates the Court’s previous case-law (judgment of 13 September 2013, Fürstlich Castell’sches Domänenamt v OHIM – Castel Frères (CASTEL), T‑320/10, EU:T:2013:424, paragraph 28), provides that, in invalidity proceedings pursuant to Article 51 of Regulation No 40/94, now Article 59 of Regulation 2017/1001, EUIPO is to limit its examination to the grounds and arguments submitted by the parties (see judgment of 10 June 2020, Representation of a chequerboard pattern, T‑105/19, not published, EU:T:2020:258, paragraph 23 and the case-law cited).
77 Article 95(1) of Regulation 2017/1001 is a statement of the duty of diligence, under which the competent institution is required to examine carefully and impartially all the relevant factual and legal aspects of the case in question (see judgment of 14 February 2019, Torro Entertainment v EUIPO – Grupo Osborne (TORRO Grande MEAT IN STYLE), T‑63/18, not published, EU:T:2019:89, paragraph 72 and the case-law cited). It is therefore a specific expression of the obligation set out in Article 41(1) of the Charter, that is to say of the right of every person to have his or her affairs handled impartially.
78 Since the present case is part of invalidity proceedings based on absolute grounds for invalidity, both the Cancellation Division and the Board of Appeal were required to carry out an examination limited to the grounds and arguments of the parties, without prejudice to the possibility of taking well-known facts into account.
79 However, by declaring the contested mark invalid on the basis of its alleged lack of distinctive character, the Board of Appeal made a ruling that went beyond the grounds and arguments put forward by the intervener.
80 In particular, it was not the intervener but the adjudicating bodies of EUIPO which established the link between the alleged lack of distinctive character of the contested mark, in respect of which no reasoning had been submitted by the intervener, and the grounds, arguments and facts which that party had put forward for the purposes of specifically proving the grounds for invalidity in Article 7(1)(g), (h) and (i) of Regulation No 40/94 and in Article 51(1)(b) of that regulation.
81 It follows that the applicant is right in claiming that the Board of Appeal departed from its position of impartiality, which it has to adopt in the context of invalidity proceedings based on absolute grounds for refusal. The applicant is also right in claiming that it was only able to reply to the arguments which were actually submitted by the other party in the course of the invalidity proceedings. Contrary to what EUIPO submits, the proprietor of a contested mark cannot be expected to reply in advance to arguments which may potentially be put forward in support of a ground for invalidity with regard to which, despite its mere mention on the form, the applicant for a declaration of invalidity has not duly provided any reasoning.
82 Furthermore, if the intervener had, in its application for a declaration of invalidity, provided reasoning with regard to the lack of distinctive character of the contested mark, the applicant could have replied to it appropriately and it cannot be ruled out that the proceedings would have culminated in a different outcome.
83 In the fourth place, if it were otherwise, it would be sufficient for an applicant for a declaration of invalidity to select all the grounds for invalidity from the drop-down menu on the form, including all the grounds for refusal set out in the current Article 7(1) of Regulation 2017/1001, for it to be open to EUIPO to rely on the detailed statement of reasons submitted in support of the application for a declaration of invalidity in order to conclude that one of those grounds for invalidity applies, even though that statement does not contain any specific reasoning with regard to the ground on which EUIPO has relied. That detailed statement of reasons could even be completely general.
84 However, such a possibility would result in invalidity proceedings based on absolute grounds for invalidity being approximated to the examination of the signs at the stage of the application for their registration as EU trade marks, which would be contrary to the clear intention of the EU legislature.
85 It follows from all of the foregoing that the contested decision must be annulled, without it being necessary to assess the third plea.
Costs
86 Under Article 134(1) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. In the present case, EUIPO and the intervener have been unsuccessful. As the applicant has claimed only that EUIPO should be ordered to pay the costs of the present proceedings, EUIPO must be ordered to bear its own costs and to pay those incurred by the applicant in the proceedings before the Court.
87 In accordance with Article 138(3) of the Rules of Procedure, the intervener must bear its own costs.
On those grounds,
THE GENERAL COURT (Third Chamber)
hereby:
1. Annuls the decision of the Fifth Board of Appeal of the European Union Intellectual Property Office (EUIPO) of 25 May 2020 (Case R 2185/2019-5);
2. Orders EUIPO to bear its own costs and to pay those incurred by Health and Happiness (H&H) Hong Kong Ltd;
3. Orders Giuliani SpA to bear its own costs.
Delivered in open court in Luxembourg on 19 October 2022.
E. Coulon | | M. van der Woude |