OPINION OF ADVOCATE GENERAL
SAUGMANDSGAARD ØE
delivered on 14 November 2019 (1)
Case C‑328/18 P
European Union Intellectual Property Office (EUIPO)
v
Equivalenza Manufactory SL
(Appeal — EU trade mark — Regulation (EC) No 207/2009 — Application for the figurative mark BLACK LABEL BY EQUIVALENZA — Opposition proceedings — Earlier figurative mark LABELL — Article 8(1)(b) — Likelihood of confusion — Similarity of the signs — Method for comparing signs — Finding that the signs at issue have an average degree of aural similarity — Obligation to carry out a global assessment of the likelihood of confusion)
I. Introduction
1. The present appeal has been brought by the European Union Intellectual Property Office (EUIPO) against the judgment of the General Court of the European Union of 7 March 2018, Equivalenza Manufactory v EUIPO — ITM Entreprises (BLACK LABEL BY EQUIVALENZA) (T‑6/17, not published, EU:T:2018:119; ‘the judgment under appeal’), by which the General Court annulled the decision of the Second Board of Appeal of EUIPO of 11 October 2016 relating to opposition proceedings between ITM Entreprises SAS and Equivalenza Manufactory SL (‘Equivalenza’) (Case R 690/2016-2; ‘the contested decision’).
2. This appeal raises several questions of law regarding the examination of the relative ground for refusal to register a sign as an EU trade mark, referred to in Article 8(1)(b) of Regulation (EC) No 207/2009, (2) based on the existence of a likelihood of confusion on the part of the public. Specifically, EUIPO asks the Court to specify the method for comparing signs and the circumstances in which the General Court is justified in considering that two signs do not satisfy the condition relating to similarity laid down in that provision.
3. As I will explain in this Opinion, the General Court’s numerous decisions in this area have not always followed the same approach in relation to those different aspects. In fact, they have differed to the point of establishing two distinct lines of case-law which currently coexist without the Court having adopted a position in favour of one or the other. This case offers the Court the opportunity to do so.
II. Legal framework
4. Regulation No 207/2009 was repealed and replaced, with effect from 1 October 2017, by Regulation (EU) 2017/1001 on the European Union trade mark. (3) Nonetheless, given the date on which the application for registration at issue in the present dispute was filed, namely 16 December 2014, which is decisive for the purpose of identifying the applicable substantive law, the present dispute is governed by the substantive provisions of the former regulation.
5. Recital 8 of Regulation No 207/2009 states:
‘The protection afforded by [an EU] trade mark, the function of which is in particular to guarantee the trade mark as an indication of origin, should be absolute in the case of identity between the mark and the sign and the goods or services. The protection should apply also in cases of similarity between the mark and the sign and the goods or services. An interpretation should be given of the concept of similarity in relation to the likelihood of confusion. The likelihood of confusion, the appreciation of which depends on numerous elements and, in particular, on the recognition of the trade mark on the market, the association which can be made with the used or registered sign, the degree of similarity between the trade mark and the sign and between the goods or services identified, should constitute the specific condition for such protection.’
6. Article 8 of that regulation, entitled ‘Relative grounds for refusal’, provides:
‘1. Upon opposition by the proprietor of an earlier trade mark, the trade mark applied for shall not be registered:
…
(b) if because of its identity with, or similarity to, the earlier trade mark and the identity or similarity of the goods or services covered by the trade marks there exists a likelihood of confusion on the part of the public in the territory in which the earlier trade mark is protected; the likelihood of confusion includes the likelihood of association with the earlier trade mark.
…
5. Furthermore, upon opposition by the proprietor of an earlier trade mark within the meaning of paragraph 2, the trade mark applied for shall not be registered where it is identical with, or similar to, the earlier trade mark and is to be registered for goods or services which are not similar to those for which the earlier trade mark is registered, where, in the case of an earlier [EU] trade mark, the trade mark has a reputation in the [European Union] and, in the case of an earlier national trade mark, the trade mark has a reputation in the Member State concerned and where the use without due cause of the trade mark applied for would take unfair advantage of, or be detrimental to, the distinctive character or the repute of the earlier trade mark.’
III. Background to the dispute
7. The background to the dispute is set out in paragraphs 1 to 10 of the judgment under appeal. For the purposes of the present appeal, this may be summarised as follows.
8. On 16 December 2014, Equivalenza filed with EUIPO an application for registration of an EU trade mark pursuant to Regulation No 207/2009 for the following figurative sign:
9. The goods in respect of which registration was sought fall in particular within Class 3 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: ‘Perfumery’.
10. On 18 March 2015, ITM Enterprises filed a notice of opposition, pursuant to Article 41 of Regulation No 207/2009, to registration of the trade mark applied for for the goods set out in the preceding point on the ground of a likelihood of confusion, within the meaning of Article 8(1)(b) of that regulation.
11. The opposition was based, inter alia, on the earlier figurative mark, reproduced below, that is the subject of international registration No 1079410, designating Austria, Belgium, Bulgaria, the Czech Republic, Denmark, Estonia, Greece, Croatia, Hungary, Lithuania, Luxembourg, Latvia, the Netherlands, Poland, Portugal, Romania, Slovenia and Slovakia, registered on 1 April 2011 and covering ‘Cologne, deodorants for personal use (perfume), perfumes’:
12. By decision of 2 March 2016, the Opposition Division upheld the opposition in respect of all of the contested goods on account of the existence of a likelihood of confusion on the part of the relevant public in the Czech Republic, Hungary, Poland and Slovenia.
13. By the contested decision, the Second Board of Appeal of EUIPO dismissed the appeal brought by Equivalenza against the Opposition Division’s decision. The Board of Appeal found that the relevant public was composed of the general public in the four Member States in question, with an average level of attention, and that the goods in question were identical. As regards the comparison of the signs at issue, the Board of Appeal considered that they had an average degree of visual and aural similarity and that were conceptually dissimilar. It inferred from this that they were similar overall. The Board of Appeal concluded that there was a likelihood of confusion, within the meaning of Article 8(1)(b) of Regulation No 207/2009, on the part of the relevant public.
IV. The procedure before the General Court and the judgment under appeal
14. By application lodged at the Registry of the General Court on 4 January 2017, Equivalenza brought an action for the annulment of the contested decision. In support of its action, it put forward a single plea in law, alleging infringement of Article 8(1)(b) of Regulation No 207/2009.
15. When examining that plea, the General Court relied on the uncontested findings of the Board of Appeal of EUIPO, in accordance with which, first, the relevant public is made up of the general public in the Czech Republic, Hungary, Poland and Slovenia with an average level of attention and, secondly, the goods designated by the signs at issue are identical (paragraphs 17 and 18 of the judgment under appeal).
16. As regards the similarity between the signs at issue, the General Court, in the first place, compared their visual, aural and conceptual aspects. In that connection, it took the view that those signs convey different overall visual impressions (paragraphs 29 to 33 of the judgment under appeal), have an average degree of aural similarity (paragraphs 34 to 39 of that judgment) and are conceptually different (paragraphs 40 to 45 of that judgment).
17. In the second place, the General Court carried out a global assessment of the similarity of the signs at issue. In that connection, it observed that, in the light of the fact that the goods in question, namely perfumes, are generally sold in either self-service stores or in perfume shops, the visual aspect of those signs was more important, for their overall impression, than their aural and conceptual aspects. In that regard, the General Court reiterated its finding that those signs are visually different. Moreover, it noted that those signs are conceptually different. The General Court concluded that, based on an overall impression, the signs at issue are not similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009 (paragraphs 48 and 51 to 55 of the judgment under appeal).
18. As one of the cumulative conditions for the application of that provision was not satisfied, the General Court held that the Board of Appeal had erred in law in finding that there was a likelihood of confusion within the meaning of that provision (paragraph 56 of the judgment under appeal). It therefore upheld the single plea in law raised by Equivalenza and annulled the contested decision.
V. The procedure before the Court and the forms of order sought
19. The present appeal was brought on 17 May 2018.
20. In its appeal, EUIPO claims that the Court should:
– set aside the judgment under appeal, and
– order Equivalenza to pay the costs.
21. In its reply, Equivalenza contends that the Court should:
– dismiss the appeal, and
– order EUIPO to pay the costs.
VI. The appeal
22. In support of its appeal, EUIPO relies on a single ground of appeal, which is divided into four parts, alleging infringement of Article 8(1)(b) of Regulation No 207/2009. As requested by the Court, I shall limit my Opinion to the analysis of the third and fourth parts of that single ground of appeal.
A. Arguments of the parties
23. By the third part of its single ground of appeal, EUIPO submits that the General Court has infringed Article 8(1)(b) of Regulation No 207/2009 as a result of a methodological error in so far as it examined the circumstances in which the goods in question are marketed and the buying habits of the relevant public at the stage of comparing the signs. In accordance with the judgment in Lloyd Schuhfabrik Meyer, (4) that comparison must be made objectively, without taking account of such factors relating to the use of the trade marks. It is only once the existence of a degree of visual, aural or conceptual similarity has been established that it is necessary, at the stage of the global assessment of the likelihood of confusion, to examine those factors in order to assess the importance that must be attributed to that degree of similarity in that global assessment. (5)
24. Equivalenza agrees with the explanations given by EUIPO regarding the method of analysis stemming from the judgment in Lloyd Schuhfabrik Meyer. Nevertheless, it considers that the General Court has complied with that method in the judgment under appeal. According to Equivalenza, the General Court, as a first step, evaluated separately the degrees of visual, aural and conceptual similarity between the signs at issue before, as a second step, carrying out the global assessment of their similarity or the analysis of the likelihood of confusion, taking account, at this stage only, of the buying habits of the relevant public. Therefore, although the judgment under appeal is not divided into sections separating each stage of the General Court’s analysis, it follows a fixed and intelligible structure and that analysis complies with the requirements of Article 8(1)(b) of Regulation No 207/2009.
25. By the fourth part of its single ground of appeal, EUIPO criticises the General Court for having infringed Article 8(1)(b) of Regulation No 207/2009 by committing several errors of law affecting the assessment of the similarity of the signs at issue.
26. In the first place, EUIPO disputes the method that the General Court followed in so far as it failed to take account of all of the elements of similarity and dissimilarity between the signs at issue in the overall assessment. Thus, EUIPO states that, in paragraph 28 of the judgment under appeal, (6) the General Court hastily ‘counteracted’ all of the elements of visual similarity between the signs on account of the visual differences noted as part of a first overall assessment of those signs. It then used those same visual differences as part of a second overall assessment of the signs at issue, in paragraph 55 of that judgment, in order to ‘counteract’ their average degree of aural similarity. That double ‘counteraction’, which relied on the same differences and the overall impression, constitutes an error of law and distorts the principles established by the case-law with regard to the comparison of the signs.
27. In the second place, EUIPO takes the view that the General Court disregarded the case-law and made a methodological error in recognising the ‘counteraction’ of the average degree of aural similarity between the signs at issue when comparing the signs and, accordingly, in prematurely refraining from carrying out any global assessment of the likelihood of confusion. First, the ‘counteraction’ of a visual or aural similarity on account of conceptual differences must take place at the stage of the global assessment of the likelihood of confusion, (7) carried out on the basis of all of the elements of similarity and dissimilarity that were identified initially. The ‘counteraction’ does not amount to disregarding the similarities that had previously been established and does not support the conclusion that there is an absence of any similarity between the signs. Secondly, the finding of the existence of a degree of similarity, even if weak, between the signs as regards one of their visual, aural or conceptual aspects gives rise to the obligation to carry out a global assessment of the likelihood of confusion. (8)
28. Equivalenza submits, in the first place, in response to EUIPO’s argument that is summarised in point 26 of this Opinion, which is said to lack clarity and to be confused, that the method that the General Court applied in the judgment under appeal is not vitiated by any error of law. It states that the General Court made two separate assessments in considering, first, that the signs at issue give a different overall visual impression in the light of their elements of visual similarity and dissimilarity and, secondly, at the stage of the global assessment of the similarity, that those signs are different overall in the light of their significant visual and conceptual differences and in view of the weak impact of the aural aspect on the category of goods in question. Therefore, the elements that were taken into account in order to rule out any visual similarity and those which were used in order to determine that there is no likelihood of confusion in the global assessment are different.
29. In that connection, Equivalenza also notes that, in order to assess the degree of similarity between the signs at issue, it may be appropriate to evaluate the importance to be attached to their visual, aural and conceptual aspects, taking account of the category of goods in question and the circumstances in which they are marketed. (9) The goods at issue in the present case, namely perfumes, are always viewed before they are purchased, as the General Court rightly recalled in paragraph 51 of the judgment under appeal. The visual aspect of the signs is, therefore, of greater importance in the global assessment of the similarity between the signs at issue or the assessment of the likelihood of confusion.
30. In the second place, in response to EUIPO’s argument which is summarised in point 27 of this Opinion, Equivalenza takes the view that it is clear from a teleological reading and interpretation of paragraph 46 et seq. of the judgment under appeal that the General Court did indeed carry out a global assessment of the likelihood of confusion. In any event, the General Court would have reached the same conclusion if it had taken account of the few similarities between the signs at issue at the stage of the global assessment of the likelihood of confusion.
B. Analysis
31. As a preliminary point, it should be recalled that Article 8(1)(b) of Regulation No 207/2009 provides for a relative ground for refusal to register a sign as an EU trade mark, on the basis of the existence of a potential conflict between that sign and one or more earlier trade marks. (10)
32. Under that provision, upon opposition by the proprietor of an earlier trade mark, the trade mark applied for must therefore not be registered ‘if because of its identity with, or similarity to, the earlier trade mark and the identity or similarity of the goods or services covered by the trade marks there exists a likelihood of confusion on the part of the public in the territory in which the earlier trade mark is protected’.
33. According to the settled case-law of the Court, (11) the likelihood of confusion covered by that provision corresponds to the risk that the public might believe that the goods or services in question come from the same undertaking, or, as the case may be, from economically linked undertakings. (12)
34. According to that case-law, the existence of that risk must be appreciated globally, taking into account all factors relevant to the circumstances of the case. Those factors include, inter alia, the distinctive character of the earlier trade mark, the degree of attention of the relevant public, the degree of similarity between the earlier trade mark and the trade mark applied for and the degree of similarity between the goods or services designated by those trade marks. (13)
35. The global nature of the assessment of the likelihood of confusion implies some interdependence between the relevant factors and in particular a similarity between the signs at issue and between the goods or services in question, with the result that, for example, a lesser degree of similarity between those goods or services may be offset by a greater degree of similarity between the signs, and vice versa. (14)
36. Nevertheless, that logic, which is generally referred to as the ‘principle of interdependence’, is not absolute. As is clear from the very wording of Article 8(1)(b) of Regulation No 207/2009, reproduced in point 32 of this Opinion, the likelihood of confusion presupposes, first, that the signs at issue are identical or similar and, secondly, that the goods or services in question are identical or similar. (15) Those two factors are therefore, in the case-law of the Court, cumulative conditions for the application of that provision.
37. It follows that Article 8(1)(b) is manifestly inapplicable, inter alia, where the signs at issue are not similar. A notice of opposition based on that provision must be rejected from the outset in such a case: the other relevant factors for the global assessment of the likelihood of confusion cannot under any circumstances offset and make up for that dissimilarity and therefore there is no need to examine them. (16)
38. In the judgment under appeal, the General Court concluded that the signs at issue are not similar, within the meaning of Article 8(1)(b) and, therefore, applied the case-law recalled in the preceding paragraph. (17) EUIPO takes the view, however, that that case-law was not applicable in the present case. According to EUIPO, the General Court was not entitled to reach such a conclusion after having compared those signs. The third and fourth parts of its single ground of appeal, which in my view should be examined together, therefore call into question the method that the General Court applied in that comparison.
39. In that regard, I note that, in the judgment under appeal, the General Court started by recalling a number of statements of principle deriving from the judgments in SABEL (18) and Lloyd Schuhfabrik Meyer, which formed the basis for the global assessment of the likelihood of confusion: first, that global assessment ‘of the visual, aural or conceptual similarity of the marks in question, must be based on the overall impression given by the marks, bearing in mind, in particular, their distinctive and dominant components’; (19) secondly, ‘in order to assess the degree of similarity between the marks concerned, it is necessary to determine the degree of visual, aural or conceptual similarity between them and, where appropriate, to assess the importance to be attached to those various factors, account being taken of the category of goods or services in question and the circumstances in which they are marketed’. (20)
40. Then, in order to implement those statements, the General Court, in the first place, compared in turn the visual, aural and conceptual aspects of the signs at issue. In that context it took the view, first of all, that, despite the elements of similarity which meant that the Board of Appeal could not conclude that there was no similarity, those signs produce a different overall visual impression, on account of their numerous and significant differences. Moreover, the General Court took the view that those signs have an average degree of aural similarity. Finally, it found that the signs at issue are conceptually different. (21)
41. In the second place, the General Court held that it was necessary ‘to examine whether the visual and conceptual differences between those signs are of such a kind as to preclude any similarity between those signs or are instead offset by the average degree of aural similarity between them’. According to the General Court, ‘the visual, aural and conceptual similarities between the signs at issue must be the subject of a global assessment in which the assessment of any aural similarity is but one of the relevant factors’. (22)
42. In the context of that second ‘global assessment of similarity’ step, the General Court observed that the visual, aural or conceptual aspects of the signs at issue do not always have the same weight and that, in that regard, account must be taken of the circumstances in which the goods in question are marketed. With regard to perfumes which are generally sold in either self-service stores or in perfume shops, in which consumers normally have the opportunity either to select for themselves the products they desire or at least to view those products before purchasing them, the visual aspect of those signs is more important, for their overall impression, than their aural and conceptual aspects. In that connection, the General Court reiterated its finding that the signs at issue are not visually similar on account of their numerous and significant differences. Moreover, it repeated that there is a conceptual difference between those signs as a result of the presence in the contested sign of the elements ‘black’ and ‘by equivalenza’. That reasoning led the General Court to conclude that, ‘on account of the differences between them and despite their average degree of aural similarity, based on an overall impression, the signs at issue are not similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009’. (23)
43. According to EUIPO, the finding that the signs at issue have an average degree of aural similarity obliged the General Court to carry out a global assessment of the likelihood of confusion. EUIPO criticises the General Court for having ‘counteracted’ that similarity when comparing the signs and, in so doing, for having prematurely refrained from carrying out the global assessment of the likelihood of confusion. The circumstances in which the goods in question are marketed and a possible ‘counteraction’ of the aural similarity on account of visual and conceptual differences should have been examined at the stage of that global assessment, in the light of those other relevant factors. (24)
44. EUIPO’s arguments therefore raise a number of questions of law. (25) In essence, the Court must determine whether the finding that there is a certain degree of similarity between signs as regards one of their visual, aural or conceptual aspects is necessary and sufficient to support the conclusion that those signs are similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009, or whether that degree of similarity may (or must) be balanced against the differences found in respect of the other aspects, as part of a ‘global assessment of similarity’ stage. In direct connection with that question, the stage (comparison of the signs or global assessment of the likelihood of confusion) at which the circumstances in which the goods in question are marketed must be taken into account and a possible ‘counteraction’ of the similarities between the signs on account of their differences must be examined.
45. As I stated in the introduction to this Opinion, the case-law of the General Court contains differing lines of case-law with regard to those various points (Section 1). Those differences require the Court to adopt a position (Section 2), which is essential in order to address the third and fourth parts of EUIPO’s single ground of appeal (Section 3).
1. Inventory of the case-law concerning the comparison of the signs
46. In accordance with a first line of case-law of the General Court, which I will describe as ‘strict’ and on which EUIPO relies in its appeal, (26) at the stage of comparing the signs, it is necessary simply to compare the visual, aural and conceptual aspects of those signs in turn. Where a similarity, even if weak, is found in (at least) one of those aspects, the global assessment of the likelihood of confusion must be carried out. (27) In other words, in such circumstances, the signs must be regarded as being similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009. (28) In the judgments which fall under that line of case-law, which, according to my research, are in the majority, (29) there is therefore no additional analysis of the ‘global assessment of similarity’, such as that carried out by the General Court in the judgment under appeal.
47. By contrast, in accordance with a second line of case-law, which I will describe as ‘flexible’, it is necessary, after having examined separately the visual, aural and conceptual aspects of the signs at issue and having found (at least) a degree of similarity as regards one of those aspects, to carry out that additional analysis in order to determine the ‘overall impression’ created by those signs. Where the General Court considers that the signs create a different overall impression, it concludes, as in the judgment under appeal, that they are not similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009, despite the degree of similarity found in respect of one or more aspects.
48. However, there is a lack of clarity, within that line of case-law, as to the way in which the General Court should carry out that ‘global assessment of similarity’. In some judgments, the General Court merely reproduces its findings regarding the existence or the absence of a degree of similarity with respect to each aspect of the signs and concludes, without stating specific reasons, that they are ‘similar overall’ or, on the contrary, ‘different overall’. (30) In other judgments, the General Court gives reasons for its conclusion in the light of the circumstances in which the goods in question are marketed or a possible ‘counteraction’ of similarities that had previously been established. (31)
49. The case-law of the Court is also equivocal with regard to the assessment of the similarity of the signs. On the one hand, some of its judgments contain indicators which are in line with the General Court’s ‘strict’ line of case-law. In that regard, the Court has held on several occasions that it is possible that mere aural similarity between the signs at issue, or even their mere conceptual similarity, may create a likelihood of confusion, but the existence of such a likelihood must be established as part of a global assessment of that likelihood, where that similarity is but one of the relevant factors. (32) The overall impression created by the signs, as regards any visual, aural and conceptual similarities between them, must therefore be assessed as part of that global assessment. (33) It follows from that line of reasoning, implicitly but necessarily, that the existence of a degree of similarity in respect of one aspect of the signs is sufficient to consider that they are similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009 and means that that global assessment must be carried out.
50. Moreover, it follows from the judgment in Ferrero v OHIM (34) that a global assessment of the likelihood of confusion must be carried out where ‘there is some similarity, even faint’, between the signs at issue. Although that statement does not make it possible as such to answer with certainty the question raised in the present case, it does, at the very least, indicate a desire to regulate strictly the application of the case-law recalled in point 37 of this Opinion.
51. On the other hand, the case-law of the Court also contains a number of indicators which are in line with the General Court’s ‘flexible’ line of case-law. In particular, the Court confirmed, again in its judgment in Ferrero v OHIM, (35) not without some ambiguity, that ‘the visual, aural and conceptual similarities between the signs at issue must be the subject of a global assessment in which the assessment of any aural similarity is but one of the relevant factors’. Moreover, in the judgment in Wolf Oil v EUIPO, (36) the Court held that ‘a distinction [must] be made between the assessment of the conceptual differences between the signs at issue and the overall assessment of their similarities, which form two distinct stages in the analysis of the overall likelihood of confusion, the first being a prerequisite for the second’, (37) thus acknowledging, it would appear, the existence of that additional stage of assessment.
52. Similar discrepancies are found in the case-law of the General Court in respect of the stage at which the circumstances in which the goods or services in question are marketed must be taken into account and a possible ‘counteraction’ of the similarities between the signs must be examined.
53. As regards, in the first place, the circumstances in which the goods or services in question are marketed, I note that in the judgments associated with the ‘strict’ line of case-law, those circumstances are a relevant factor for the global assessment of the likelihood of confusion. (38) That factor implies that, when the goods or services in question are, for example, ordinarily sold in self-service stores and therefore the consumer above all encounters the signs at issue visually, the General Court gives preponderant weight to the visual similarities, or, conversely, the visual dissimilarities found, without, however, failing to take account of the other aspects and all of the relevant factors for the global assessment of that likelihood of confusion. (39)
54. By contrast, in other judgments, which fall under the ‘flexible’ line of case-law, which includes the judgment under appeal, the circumstances in which the goods or services in question are marketed are examined at the stage of comparing the signs. If those goods or services are marketed in such a way that their visual aspect is more important for the consumer and the General Court has not found any similarity in respect of that aspect, it holds that the signs are not similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009, irrespective of any possible degree of similarity in respect of the other aspects of the signs, and without examining the other relevant factors for the global assessment of the likelihood of confusion.
55. Here again, the Court has not given a clear decision in favour of either approach. A number of decisions by the Court tend to suggest that the circumstances in which the goods or services in question are marketed are a relevant factor when assessing the similarity of the signs. (40) By contrast, it follows from the judgment in Il Ponte Finanziaria v OHIM (41) that this is a relevant factor for the global assessment of the likelihood of confusion. (42)
56. As regards, in the second place, the issue of the ‘counteraction’ of similarities between the signs at issue, it has been established, in the case-law of the Court and of the General Court, that conceptual differences separating the signs may, in certain circumstances, ‘counteract’ their visual and aural similarities. For there to be such a ‘counteraction’, at least one of the signs at issue must have, from the point of view of the relevant public, a clear and specific meaning so that the public is capable of grasping it immediately. (43)
57. That said, again, the question as to the stage at which such a ‘counteraction’ must be examined does not find a straight answer in the case-law of the General Court. In some judgments, the existence of a possible ‘counteraction’ is examined at the stage of the global assessment of the likelihood of confusion. (44) In others, the General Court examines that possibility as part of the analysis of the conceptual similarity (45) or immediately after the comparison of each aspect of the signs, as part of the ‘global assessment of similarity’. (46)
58. Moreover, when a ‘counteraction’ is found, the consequences vary. In some cases, the General Court still carries out the global assessment of the likelihood of confusion by examining the other relevant factors. (47) In others, the General Court concludes that the signs are not similar and rejects from the outset the arguments relating to those other factors. (48)
59. The case-law of the Court is, again, equivocal. A number of judgments tend to suggest that the ‘counteraction’ of similarities must occur in the global assessment of the likelihood of confusion and that this does not dispense the General Court from examining the other relevant factors for that global assessment. (49) Furthermore, in the judgment in Mülhens v OHIM, (50) the Court explained that the ‘counteraction theory’ arises specifically from the global nature of the assessment of the likelihood of confusion and the principle of interdependence, which ‘means that conceptual and visual differences between two signs may counteract aural similarities between them’.
60. By contrast, the opposite approach is seen in the judgment in OHIM v riha WeserGold Getränke. (51) In the judgment giving rise to the appeal in that case, the General Court had, first, ‘counteracted’, when comparing the signs, the visual and aural similarities between the signs at issue, on account of their conceptual differences, and concluded from this that the signs were ‘different overall’. (52) Nevertheless, the General Court had held that the Board of Appeal had erred in law by not examining the distinctive character of the earlier trade mark — a factor which, I note, is relevant not for determining the similarity of the signs, but for the global assessment of the likelihood of confusion. The Court set aside the judgment in question. For the Court, since the General Court had concluded that the signs at issue were ‘different overall’, it was no longer necessary to examine the distinctive character of the earlier trade mark. (53) It follows that the General Court was justified in ‘counteracting’ the visual and aural similarities between the signs when comparing them and that the ‘counteraction’ necessitated a finding that the signs at issue were not similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009, a conclusion which curtails the examination of the notice of opposition, in accordance with the case-law referred to in point 37 of this Opinion.
61. Even more explicitly, in the judgment in Wolf Oil v EUIPO, (54) the Court confirmed that ‘the neutralisation of the visual and phonetic similarities of the signs at issue by their conceptual differences is examined when making the overall assessment of the similarity of those signs’. (55) Moreover, in that judgment, the Court endorsed the General Court’s approach which consisted in concluding that the signs were not similar given the ‘counteraction’ that was found. (56)
2. Summary and view
62. In summary, two methods coexist in the case-law of the General Court and of the Court with regard to the similarity of signs. There is, on the one hand, a ‘strict’ method, in accordance with which, at the stage of comparing the signs, the General Court must merely compare their visual, aural and conceptual aspects. Where it finds a degree of similarity in respect of (at least) one of those aspects, it must conclude that the signs are similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009. If the goods or services in question are also similar, the General Court must carry out a global assessment of the likelihood of confusion. The circumstances in which those goods or services are marketed and the possible ‘counteraction’ of the similarities found between the signs on account of their conceptual difference must be examined as part of that global assessment, among all of the relevant factors.
63. There is, on the other hand, a ‘flexible’ method, in accordance with which the General Court must not only compare the visual, aural and conceptual aspects of the signs, but, in addition, it must balance the degrees of similarity and the differences found in respect of every aspect, as part of a ‘global assessment of similarity’ stage, by potentially taking account of those marketing conditions and a possible ‘counteraction’. If, in the General Court’s view, the differences outweigh the similarities, it must consider that the signs are not similar (overall), within the meaning of Article 8(1)(b) of Regulation No 207/2009, and dispense with carrying out the global assessment of the likelihood of confusion.
64. At the outset, I consider that, in the present case, the Court should adopt a position in favour of one of the methods. It falls to the Court to harmonise the case-law on trade mark law and to establish a clear and coherent position on the subject.
65. In that regard, contrary to what Equivalenza implies, (57) the present case is not a matter of determining a question of pure presentation. The issue in this case is the extent of the examination to be carried out by the General Court when it examines an appeal relating to opposition proceedings based on Article 8(1)(b) of Regulation No 207/2009. That involves determining the limits within which the General Court can apply the case-law, referred to in point 37 of this Opinion, which releases it from the obligation to carry out a global assessment of the likelihood of confusion. Choosing the ‘flexible’ method would facilitate the application of that case-law whereas, conversely, the ‘strict’ method would reduce the possibility of having recourse to it.
66. While accepting that the choice between the two methods is not easy, I am of the view, all things considered, that the General Court and the Court should confine themselves to the ‘strict’ method described in point 62 of this Opinion.
67. The latter method seems to me, in the first place, to be more in line with the scheme of Article 8(1)(b) of Regulation No 207/2009.
68. On that point, I note that two related, but nonetheless distinct, questions arise from the wording of that provision in respect of the similarity of the signs at issue: first, does such similarity exist? And, secondly, is that similarity sufficient to give rise to a likelihood of confusion on the part of the public? Logically, the condition stipulated in that provision that the signs are similar should be considered to be satisfied where the first question has been answered in the affirmative, irrespective of the answer to the second.
69. Like EUIPO, (58) I consider that the response to the first question merely involves comparing the signs at issue and establishing the existence of elements of visual, aural or conceptual similarity (59) between them. This initial analysis of the signs has a limited purpose. It is intended solely to determine their formal relationship. It is during the second analysis, (60) the global assessment, aimed at answering the second — fundamental — question of the likelihood of confusion, that it must be determined whether those elements of similarity are sufficient, taking into account all the relevant factors, to give rise to a likelihood of confusion. (61)
70. Admittedly, the comparison of the signs cannot be a purely abstract exercise. It must always be carried out through the eyes of the (hypothetical) perception of the average consumer of the category of goods or services in question. (62) That comparison must therefore be based on the ‘overall impression’ left by those signs in the consumer’s memory and according to the principle of the imperfect image. (63) In that context, where it compares the visual, aural and conceptual aspects of the signs at issue and assesses the similarity in respect of each aspect, the General Court is inevitably prompted to balance the elements of similarity and dissimilarity (the former may outweigh the latter in that overall impression or vice versa), and the possible degree of similarity (weak, average or high) assigned to each aspect of the signs is, essentially, merely a simplification of the nuances arising from that comparison. (64)
71. However, in my view, it is one thing to balance the similarities and dissimilarities when comparing the visual, aural or conceptual aspects of the signs at issue, in order to assess the degree of similarity of the aspect in question. It is another to balance the degrees of similarity and the differences found in respect of those different aspects.
72. As EUIPO argues, in essence, (65) to balance those aspects thus twice in succession (first, with regard to the elements of similarity and dissimilarity found in respect of one aspect of the signs, in order to give a decision on the existence of a degree of similarity as regards that aspect; and, secondly, with regard to the similarities and differences found in respect of the various aspects of the signs, in order to give a decision on the ‘overall similarity’ of those signs) leads to the risk of an excessive simplification of their similarity, masking elements which may, if all of the circumstances of the case had been taken into account, have been capable of demonstrating a likelihood of confusion. In that regard, I note that it cannot be ruled out that the mere aural similarity between two signs, or even their mere conceptual similarity, may, in some circumstances, lead to a likelihood of confusion. (66)
73. Thus, in my view, the ‘flexible’ method for comparing signs and the ‘global assessment of similarity’ stage confuse the two analyses described in point 69 of this Opinion and go beyond the objective of the comparison of the signs. Following that method potentially entails prejudging, at the stage of that comparison, the question of the possible existence of a likelihood of confusion.
74. I must stress here that the question whether that similarity between the signs at issue is sufficient to give rise to a likelihood of confusion cannot be assessed independently of the other relevant factors for the global assessment of that likelihood and of the principle of interdependence, which is aimed at ensuring that that assessment is, as far as possible, in line with the actual perception of the relevant public of those signs. (67) Factors such as, inter alia, the degree of attention of the public and the distinctive character of the earlier trade mark are of utmost importance in that regard. A consumer who pays a high level of attention will perceive differences that a consumer who is less attentive might not notice. Similarly, when confronted with an earlier trade mark which is highly distinctive, because it is composed of original elements, the public will attribute little importance to the differences between the signs at issue whereas, when confronted with a trade mark which has a weak distinctive character, because it is made up of descriptive, evocative or common elements, the public will attribute more weight to their differences. (68)
75. Moreover, I consider, as does EUIPO, (69) that neither consideration of the circumstances in which the goods or services in question are marketed nor consideration of a possible ‘counteraction’ should allow the General Court to ‘erase’ from the outset, at the stage of comparing the signs, a degree of similarity that has been found in respect of one of their aspects (particularly where, as in the present case, this involves an average degree of aural similarity).
76. First, the consideration of the circumstances in which the goods or services in question are marketed falls, by nature, under the prospective analysis of the potential use of the signs at issue on the market, which is inherent to the global assessment of the likelihood of confusion. (70) It is no longer a matter of comparing the signs in order to identify their similarities and differences, but of determining the extent to which the similarities found play a part in demonstrating that likelihood of confusion. Where, for example, the goods are sold in such a way that the consumer always encounters the signs at issue visually, it follows solely, in my view, that it is less probable that their aural similarity will lead to that likelihood of confusion. Nevertheless, that possibility cannot be ruled out and depends on all of the factors in that global assessment. Consequently, the General Court cannot merely disregard that similarity at the stage of comparing the signs.
77. A different interpretation cannot be seen, in my view, in the judgment in Lloyd Schuhfabrik Meyer. (71) I understand that judgment, as does EUIPO, (72) to mean that, in order to establish the existence of a likelihood of confusion, it is necessary, inter alia, to compare the signs at issue as regards their different aspects and, if, in that context, a degree of similarity is found in respect of one aspect, to ‘assess the importance’ of that finding in order to demonstrate that likelihood, taking account, in particular, of the circumstances in which the goods or services in question are marketed. In other words, the Court’s intention was solely to clarify the extent to which the finding of a degree of similarity between the signs in respect of a given aspect (in that case it was aural similarity) demonstrates the existence of a likelihood of confusion, without prejudice to the other relevant factors. (73)
78. Secondly, the ‘counteraction theory’ also falls, by nature, under the global assessment of the likelihood of confusion. That theory simply indicates that the conceptual differences between two conflicting signs are capable of reducing the likelihood of the consumer confusing the origin of goods or services in question, despite the fact that those signs are visually and/or aurally similar. In such circumstances, the effect of those similarities on the consumer’s perception of the signs is ‘counteract[ed] to a large extent’. (74) However, it is possible that, in spite of this, those similarities will lead to a likelihood of confusion in some cases. (75) The finding of a possible ‘counteraction’ cannot therefore, in my view, permit the General Court to eliminate those similarities at the stage of comparing the signs and relieve it from examining the other factors that are relevant for the assessment of the likelihood of confusion. (76)
79. The ‘strict’ method also seems to me, in the second place, to be more in line with the objective of Article 8(1)(b) of Regulation No 207/2009. In that regard, I would point out the aim of that provision is essentially to protect the competitive interests of economic operators, by preventing the registration of signs that may undermine the function as an indication of origin performed by their trade marks. (77)
80. In the light of that objective, the proprietor of a trade mark who opposes the registration of a sign should, in my opinion, have a fair opportunity to demonstrate a likelihood of confusion and the need for protection. In particular, he should have the opportunity to demonstrate that, for example, mere conceptual or aural similarity between the signs is sufficient, taking into account all the circumstances, to give rise to a likelihood of confusion. (78) In that connection, the condition of similarity of the signs should remain a minimum prerequisite in order to access that protection, and that condition should not, except in cases of a manifest failure to comply, be used to cut short any debate on that likelihood of confusion. (79) The case-law referred to in point 37 of this Opinion should therefore be applied sparingly.
81. The ‘strict’ method also does not seem to me to go beyond the objective of protection pursued in Article 8(1)(b) of Regulation No 207/2009.
82. In particular, the obligation to carry out a global assessment of the likelihood of confusion where a degree of similarity in one of the aspects of the signs at issue has been found does not mean that it must automatically (and therefore excessively) be accepted that a likelihood of confusion exists, even where the goods or services in question are identical. (80)
83. The global assessment of the likelihood of confusion must make it possible to determine, in each case, whether the earlier trade mark on which the opposition is based merits protection, in accordance with the objective pursued in Article 8(1)(b) of Regulation No 207/2009. The fact that the signs at issue are similar, as are the goods or services in question, cannot, alone, affect the outcome of that assessment. In particular, the distinctive character of that earlier trade mark must be regarded as being of decisive importance in that regard. Whilst, according to the case-law of the Court, the more distinctive the earlier trade mark, the greater will be the likelihood of confusion, (81) the opposite is also true. With regard to a trade mark with a weak distinctive character, and which thus has a lesser capacity to identify the goods or services for which it has been registered as coming from a particular undertaking, the degree of similarity between the signs should be high to justify a likelihood of confusion, or this would risk granting excessive protection to that trade mark and its proprietor. (82)
84. It is true that some judgments reveal a drift on this issue. Thus, the General Court sometimes holds that the mere finding that the goods are identical and there is some similarity, however faint, between the signs is sufficient in any event to give rise to a likelihood of confusion, irrespective of the fact that the earlier trade mark has weak distinctive character. (83) Those judgments deviate, in my view, from the objective pursued in Article 8(1)(b) of Regulation No 207/2009 and create a problem of the ‘overprotection’ of trade marks, which has been much commented upon. (84)
85. However, although this is a real problem, I do not think that the solution lies in the ‘flexible’ method of comparing signs. In fact, it lies in reassessing the weight that should be given to the distinctive character of the earlier trade mark in the global assessment of the likelihood of confusion.
86. In the third place, considerations of legal certainty, in my view, militate against adopting the ‘flexible’ method. To me, that principle requires inter alia that, as far as possible, reasoning is transparent and decisions are foreseeable. In the judgments of the General Court, there is often a lack of clarity in the ‘global assessment of similarity’ stage (85) and a double balancing exercise between the similarities and differences between the signs involved which affects whether the outcome of the comparison of the signs is foreseeable. (86) By contrast, the ‘strict’ method offers, in my eyes, clear reasoning in that regard.
87. Lastly, promoting the ‘flexible’ method would inevitably create tension with the case-law on Article 8(5) of Regulation No 207/2009. (87) In that regard, I would point out that, in connection with that provision, the Court has favoured a ‘strict’ approach: where the General Court finds some similarity, however faint, between the signs at issue as regards one of their visual, aural or conceptual aspects, it must undertake an overall assessment of the relevant factors in order to determine the likelihood that the public concerned might establish a link between those signs. (88) The tension is all the higher since, in principle, the condition that the signs are similar, which is common to Article 8(1)(b) and Article 8(5) of that regulation, must be assessed in the same way in the context of either provision. (89)
3. Response to the third and fourth parts of EUIPO’s single ground of appeal
88. In the light of the foregoing, I take the view that the third and fourth parts of the single ground of appeal put forward by EUIPO are well-founded. By carrying out, in paragraphs 46 to 54 of the judgment under appeal, a ‘global assessment of similarity’ step, taking into account, in that connection, in paragraphs 48, 51 and 53 of that judgment, the circumstances in which the goods in question are marketed and, in paragraph 54 of that judgment, the existence of a conceptual difference between the signs, and, finally, by concluding, in paragraph 55 of that judgment, that ‘despite their average degree of aural similarity, based on an overall impression, the signs at issue are not similar, within the meaning of Article 8(1)(b) of Regulation No 207/2009’, the General Court has, in my view, misinterpreted that provision.
89. In my mind, those errors of law call into question the legality of the operative part of the judgment under appeal. The General Court could not validly order, in point 1 of the operative part of that judgment, the annulment of the contested decision, which found there was a likelihood of confusion, without having first carried out a global assessment of that likelihood, in accordance with the method described in point 62 of this Opinion. I therefore propose that the Court, irrespective of the response to the first and second parts of the single ground of appeal, should set aside that judgment.
VII. Conclusion
90. In the light of all the foregoing considerations, I propose that the Court should set aside the judgment of the General Court of the European Union of 7 March 2018, Equivalenza Manufactory v EUIPO — ITM Entreprises (BLACK LABEL BY EQUIVALENZA) (T‑6/17, not published, EU:T:2018:119).