Mark Engelman represents CPM United Kingdom Ltd against Intel –

On Thursday 26th June the Advocate General to the ECJ gave her opinion to the Court on the outcome of the ongoing dispute between the telemarketing company CPM and the computer chip company INTEL in relation to the complex question of interest to all major brand owners – what constitutes dilution of a well established brand? The opinion uniquely seeks to harmonise trademark law in Europe with that of the United States.

In a battle which began as an attack on CPM’s trade mark registration in the UK Trade Mark Office, progressed through 2 appeals to the Court of Appeal, concluded with 3 reference questions to the ECJ. The Advocate General gave her opinion as to how the ECJ should answer the 3 questions. The Opinion seeks to balance the opposing forces: the extent of protection trade mark owners should possess versus market-place dominance.

The principle requirements INTEL needed to prove in order to succeed were:

   1. reputation in its INTEL trade mark,

   2. that INTEL and INTELMARK were similar trade marks,

   3. that the respective goods/services, micro-processors versus telemarketing services were identical/similar/dissimilar to one another,

   4. that CPM’s registration of the trade mark INTELMARK was “without due cause”,

   5. that INTELMARK was free-riding on the reputation of INTEL or tarnished its reputation or that its mere presence reduced the marketing power of INTEL, (dilution),

   6. that the average consumer upon seeing INTELMARK linked it with the trade mark INTEL.

The questions the Advocate General answered related principally to the last 2 of the 6-part test.

Links

In relation to whether the average consumer linked the 2 brands, whilst the Advocate General accepted, as was found by the English High Court, the fact that INTELMARK “brought to mind” INTEL was enough to establish a “link”, INTEL’s argument that the ECJ should look no further than that, in completing the 6-part test was wrong. The fact that INTEL had a huge reputation and might be unique were factors not so relevant to establishing such a “link”.

The global appreciation test referred to in Adidas was the correct test, but importantly, and for the first time, she incorporated into that global appreciation test the factors listed by the US Federal Government for the assessment of dilution under section 43 (c) of the United States Trademarks Act (as amended by the Trademark Dilution Revision Act 2006). An entirely sensible conclusion, because there is a high degree of similarity between the factors listed in the United States Act and those identified previously by the ECJ in the Adidas judgement.

The Court of Appeal felt that an additional factor, namely the existence of an “economic connection” between CPM and Intel Corporation in the mind of the consumer, was relevant. That feeling was not shared by the Advocate General, a conclusion which aligns with the ECJ’s previous rulings on existence of “a link”.

Free Riding

Importantly for CPM, when it came to analysing whether INTELMARK did free ride off the reputation of INTEL, the facts decided by the United Kingdom Patent Office and ultimately referred to the ECJ were considered by her to be “too flimsy” to support such a conclusion.

Dilution

She similarly concluded, in relation to whether the existence of the INTEMARK registration diluted the attractiveness of the INTEL trademark, that those same facts did not support such a finding. She said that for dilution to take place, the INTEL trade mark need not have been unique in the market place but its distinctiveness, that is, its ability to be recognised as a trade mark, is a more important factor.

Further, simply because, as was alleged by Intel, INTELMARK was the first trademark in the market-place to contain the word INTEL other than INTEL itself, was not on its own enough to trigger dilution, but merely led to the prospect of that taking place. In addition, INTEL did not need to establish any change in the economic behaviour of the average consumer, but if it had, that would have been useful.

Finally, the extent of dissimilarity in goods/services covered by the two marks is not decisive as of itself to prevent dilution occurring.

Tarnishing

Again, on the question of tarnishing, the facts of the case were considered by her “clearly insufficient” to establish that allegation.

In conclusion, the Advocate General endorsed the United Kingdom’s distinction between an unused later trade mark and those which have been on the market for some time. Evidence of dilution, tarnishing and/or unfair advantage was easier to find where trade marks like INTELMARK had been used and more difficult, when they had not. But even in relation to the latter situation, Intel was required to produce prima face evidence of such a future risk.

For more information a copy of the Advocate General’s Opinion  can be found here