The Court of Justice for the European Union (CJEU) clarified the assessment of a position mark's distinctiveness in Aktiebolaget Östgötatrafiken v Patent-och registreringsverket. You can read the full case here.
This case confirms that position marks depend on consumer perception.
In 2016, the Swedish bus company applied to register various signs including the one set out below as Swedish trade marks in class 39 for vehicles and transport:
The applications included the description: "Colouring of vehicles in the colours red, white and orange as shown".
In 2017, the Swedish trade mark Office rejected the Applications on the basis that the signs were merely decorative and therefore could not be capable of distinguishing the applied for services.
The bus company filed two appeals. On its second appeal, the Swedish trade mark office asked the CJEU to explain whether a position mark should be assessed regardless of whether the mark independent of the appearance of the relevant product and, if so, whether the trade mark needs to depart significantly from the norms of the relevant business sector (i.e. buses) in order to have distinctive character.
The CJEU's decision
The CJEU confirmed that it is the perception of the relevant public that is key. In this case, a sign consisted of coloured motifs that are intended to be affixed exclusively and systematically in a specific manner to a large part of the goods. The question of whether that sign departs significantly from the norm or customs of the relevant business sector was not considered relevant unless it affected consumer perception.
What does this mean for fashion?
Fashion followers will recall the drama around Louboutin's red soles. The main question in that case was whether the red sole trade mark was a shape mark or a colour mark. If it was a shape mark, the additional requirements for shape marks such as “substantial value” would apply to the mark. You can read more about it in our blog post here.
This new ruling confirms that position marks are a valuable trade mark tool but they likely require substantial evidence regard consumer perception in order to be granted.