Mega Brands v EUIPO - Diset (MAGNEXT) (Judgment) [2016] EUECJ T-292/12 (01 June 2016)

Judgment On 29 March 2010, the applicant, Mega Brands International, Luxembourg, Zweigniederlassung Zug, filed an application for registration of a European Union trade mark with the European Union Intellectual Property Office (EUIPO) under Council Regulation (EC) No 207/2009 of 26 February 2009 on the European Union trade mark (OJ 2009 L 78, p. 1). Registration as a mark was sought for the word sign MAGNEXT. The goods in respect of which registration was sought are in Class 28 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: ‘Toys and playthings, in particular multi-part construction toys, its parts, its accessories and its fittings’. On 17 June 2010, Diset, SA filed a notice of opposition, pursuant to Article 41 of Regulation No 207/2009, to registration of the mark applied for in respect of the goods referred to in paragraph 2 above. The opposition was based on, inter alia, the earlier Spanish word mark MAGNET 4, applied for on 10 July 2003 and registered on 9 December 2003 for goods in Class 28 and corresponding to the following description: ‘Games, toys, gymnastic and sports articles not included in other classes, decorations for Christmas trees’. The grounds relied on in support of the opposition were those set out in Article 8(1)(b) of Regulation No 207/2009. The opposition was based on all of the goods covered by the earlier trade mark. By decision of 21 June 2011, the Opposition Division upheld the opposition. The applicant lodged an appeal with EUIPO, under Articles 58 to 64 of Regulation No 207/2009, against the decision of the Opposition Division. By decision of 24 April 2012 (‘the contested decision’), the Fourth Board of Appeal of EUIPO dismissed the appeal. The Board of Appeal found, in essence, that the two signs were visually and phonetically similar to a medium degree, whereas conceptually they were dissimilar. Moreover, in view of the average distinctiveness of the earlier mark and the fact that the goods covered by the marks at issue were identical, the Board of Appeal concluded that there was a likelihood of confusion. Procedure before the General Court and the Court of Justice By application lodged at the Registry of the General Court on 3 July 2012, the applicant brought an action for annulment of the contested decision. In support of its action, the applicant raised a single plea in law, alleging infringement of Article 8(1)(b) of Regulation No 207/2009. By its judgment of 4 February 2014 in Mega Brands v OHIM — Diset (MAGNEXT) (T‑604/11 and T‑292/12, not published, EU:T:2014:56), the Court dismissed the action and ordered the applicant to pay the costs. By an appeal lodged at the Registry of the Court of Justice on 9 April 2014, the applicant sought to have the judgment of 4 February 2014 in MAGNEXT (T‑604/11 and T‑292/12, not published, EU:T:2014:56) set aside in so far as, by that judgment, the General Court had dismissed the action in Case T‑292/12. By its judgment of 19 March 2015 in MEGA Brands International v OHIM (C‑182/14 P, EU:C:2015:187 , paragraphs 38 to 40), the Court of Justice held, in essence, that the General Court had erred in failing to take into account, in its assessment of the similarity of the signs at issue, the presence of the element ‘4’ in the earlier mark. According to the Court of Justice, that failure constituted a lack of substantiation to the extent that the finding of a likelihood of confusion was based, in the present case, on an insufficiently substantiated assessment concerning the dominant character of the element ‘magnet’ (judgment of 19 March 2015 in MEGA Brands International v OHIM , C‑182/14 P, EU:C:2015:187 , paragraphs 39 to 41 and 57 to 59). The Court of Justice consequently set aside the judgment of 4 February 2014 in MAGNEXT (T‑604/11 and T‑292/12, not published, EU:T:2014:56), in so far as the General Court had dismissed the action in Case T‑292/12 and, finding that the state of the proceedings did not enable it to give final judgment, referred the case back to the General Court for judgment, reserving the costs. Forms of order sought by the parties in the proceedings after referral back to the General Court The applicant claims that the Court should: – annul the contested decision; – order EUIPO to pay the costs. EUIPO contends that the Court should: – dismiss the action; – order the applicant to pay the costs. Law In support of its action, the applicant raises a single plea in law, alleging infringement of Article 8(1)(b) of Regulation No 207/2009. Article 8(1)(b) of Regulation No 207/2009 provides that, upon opposition by the proprietor of an earlier trade mark, the mark applied for is not to 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 mark is protected. The likelihood of confusion includes the likelihood of association with the earlier mark. Furthermore, under Article 8(2)(a)(ii) of Regulation No 207/2009, the term ‘earlier trade marks’ means trade marks registered in a Member State with a date of application for registration which is earlier than the date of application for registration of the EU trade mark. According to settled case-law, the risk that the public may believe that the goods or services in question come from the same undertaking or from economically-linked undertakings constitutes a likelihood of confusion. According to the same line of case-law, the likelihood of confusion must be assessed globally, according to the relevant public’s perception of the signs and goods or services in question and taking into account all factors relevant to the circumstances of the case, in particular the interdependence between the similarity of the signs and that of the goods or services covered (see judgment of 9 July 2003 in Laboratorios RTB v OHIM — Giorgio Beverly Hills (GIORGIO BEVERLY HILLS) , T‑162/01, EU:T:2003:199 , paragraphs 30 to 33 and the case-law cited). For the purposes of applying Article 8(1)(b) of Regulation No 207/2009, a likelihood of confusion presupposes both that the marks at issue are identical or similar and that the goods or services which they cover are identical or similar. Those conditions are cumulative (see judgment of 22 January 2009 in Commercy v OHIM — easyGroup IP Licensing (easyHotel) , T‑316/07, EU:T:2009:14 , paragraph 42 and the case-law cited). Furthermore, in the global assessment of the likelihood of confusion, account should be taken of the average consumer of the category of goods concerned, who is reasonably well informed and reasonably observant and circumspect. It should also be borne in mind that the average consumer’s level of attention is likely to vary according to the category of goods or services in question (see judgment of 13 February 2007 in Mundipharma v OHIM — Altana Pharma (RESPICUR) , T‑256/04, EU:T:2007:46 , paragraph 42 and the case-law cited). In the present case, the applicant does not dispute the findings of the Board of Appeal regarding the definition of the relevant public, composed of average Spanish-speaking consumers who are reasonably observant and circumspect, nor does the applicant dispute the findings concerning the partial identity of the goods covered by the marks at issue since the categories ‘games/playthings and toys’ covered by the marks at issue are identical. Since those findings are not marred by error, they must be upheld. By contrast, the applicant disputes the Board of Appeal’s assessment that the signs at issue are visually and phonetically similar to a medium degree. Moreover, the applicant claims that the signs at issue are conceptually dissimilar. In its response, EUIPO contends that the signs at issue are phonetically similar to a medium degree since they share the same first five letters and their respective subsequent syllables differ only in the letter ‘x’. Moreover, according to EUIPO, the word mark is visually similar to the earlier mark to a medium degree. Furthermore, it argues, even if the word ‘magnet’ evokes for the relevant public the idea of an object having magnetic properties, a possible association with the adjective ‘magnético’ would not be such as to render the signs at issue conceptually dissimilar to a degree that could counteract their visual and phonetic similarities. In this regard, two marks are similar when, from the point of view of the relevant public, they are at least partially identical as regards one or more relevant aspects (judgment of 23 October 2002 in Matratzen Concord v OHIM — Hukla Germany (MATRATZEN) , T‑6/01, EU:T:2002:261 , paragraph 30). The global assessment of the likelihood of confusion must, so far as concerns the visual, phonetic or conceptual similarity of the signs at issue, be based on the overall impression given by the signs, bearing in mind, in particular, their distinctive and dominant elements (judgment of 11 November 1997 in SABEL , C‑251/95, EU:C:1997:528, paragraph 23). It must also be recalled, on the one hand, as the Court of Justice has pointed out in its judgment of 19 March 2015 in Mega Brands International v OHIM (C‑182/14 P, EU:C:2015:187 , paragraph 38 and the case-law cited), that it is only if all the other components of the mark are negligible that the assessment of similarity can be carried out solely on the basis of the dominant element (judgment of 12 June 2007 in OHIM v Shaker , C‑334/05 P, EU:C:2007:333 , paragraphs 41 and 42). On the other hand, it must be recalled that, while it is true that consumers generally pay greater attention to the beginning of a mark than to its end, that cannot hold in all cases (judgments of 6 July 2004 in Grupo El Prado Cervera v OHIM — Héritiers Debuschewitz (CHUFAFIT) , T‑117/02, EU:T:2004:208, paragraph 48; of 12 July 2006 in Vitakraft-Werke Wührmann v OHIM — Johnson’s Veterinary Products (VITACOAT) , T‑277/04, EU:T:2006:202, paragraphs 53 to 62; and of 9 September 2008 in Honda Motor Europe v OHIM — Seat (MAGIC SEAT) , T‑363/06, EU:T:2008:319, paragraph 38). In the present case, with regard to the visual comparison of the signs at issue, while it is true that the signs in question share a number of characters, it must be noted that the word mark for which registration is sought, MAGNEXT, differs from the earlier word mark, MAGNET 4, in the presence of the capital letter ‘X’ and the absence of the element ‘4’. However, contrary to what EUIPO contends, the element ‘4’ cannot be regarded as negligible. In particular, the fact that the mark applied for consists of only one single element, whereas the earlier mark consists of two elements - one of which is not a word but a number - helps to counterbalance the fact that the first characters are common to the two signs at issue and to produce a distinct visual impression. In view of the foregoing, the Court takes the view that the applicant is therefore correct in pointing out that the element ‘4’, the presence of which will be noted, cannot be entirely neglected in the assessment of the visual impression of the signs at issue, and that it contributes to distinguishing between those signs. It is, moreover, the failure to take that element into account in the analysis of the similarity of the signs at issue and the likelihood of confusion that led to the abovementioned annulling judgment of the Court of Justice. With regard to the phonetic comparison of the signs at issue, it must be noted that the mark applied for consists of only two syllables, ‘mag’ and ‘next’, whereas the earlier mark consists of five syllables, ‘mag’, ‘net’, ‘cu’, ‘a’ and ‘tro’, and that only the first syllable is common to the two signs at issue. While, admittedly, it cannot entirely be ruled out that there may possibly be a slight similarity in Spanish between the second syllable of the mark applied for, ‘next’, and that of the earlier mark, ‘net’, the Court considers that such a possibility is no greater than the probability that the letter ‘x’ may be pronounced in a distinct manner, thus significantly qualifying any phonetic similarity between the signs at issue. Furthermore, the existence of the additional element ‘cuatro’ in the earlier mark - which cannot be regarded as negligible since it is pronounced and includes, in Spanish, one syllable more than the element ‘magnet’ - largely counterbalances any similarity between the first and, possibly, the second syllables of the signs at issue. Finally, with regard to the comparison of the signs at issue from a conceptual point of view, the assessment set out in paragraph 19 of the contested decision must be confirmed, to the effect that the existence in Spanish of the adjective ‘magnético’, commonly used by the relevant public to designate an article having magnetic properties, has the consequence that that public will associate the earlier mark with objects having such properties. In that context, the Board of Appeal rightly concluded in paragraph 20 of the contested decision that there is no conceptual similarity between the mark applied for, on the one hand, and the earlier mark, on the other, since the word ‘magnext’, which does not exist in Spanish and is not otherwise connected to any current concept, will be perceived as being fanciful. It follows from the foregoing not only that there is merely a low degree of visual similarity and a very low degree of phonetic similarity between the marks at issue, but also that they are conceptually dissimilar. It has already been held that, where at least one of the two signs in question has a clear and specific meaning such that the relevant public can grasp it immediately, the conceptual differences found to exist between those signs may counteract the visual and phonetic similarities between them (judgment of 12 January 2006 in Ruiz-Picasso and Others v OHIM , C‑361/04 P, EU:C:2006:25, paragraph 20). That is the position here. The conceptual differences identified in paragraph 29 above are capable of counteracting to a very large extent, and even cancelling, the visual and phonetic similarities identified in paragraphs 25 and 28 above. Only the earlier mark will be perceived as referring to the concept of magnetism, while the mark applied for will be perceived as being purely fanciful. This distinctive overall impression is further reinforced by the possibility that the relevant public might identify the English word ‘next’ within the mark applied for, whereas the mark MAGNET 4 does not contain any element that can associate it with that word. In that regard, it must be borne in mind that, although the average consumer normally perceives a mark as a whole and does not proceed to analyse its various details, the fact remains that, when perceiving a word sign, he will break it down into elements which, for him, suggest a concrete meaning or which resemble words known to him (see, to that effect, judgments of 13 February 2007 in RESPICUR , T‑256/04, EU:T:2007:46 , paragraph 57, and of 13 February 2008 in Sanofi-Aventis v OHIM — GD Searle (ATURION) , T‑146/06, not published, EU:T:2008:33, paragraph 58). It was made clear in the judgment of 6 October 2004 in Vitakraft-Werke Wührmann v OHIM — Krafft (VITAKRAFT) (T‑356/02, EU:T:2004:292 , paragraph 51) that it is possible for the relevant consumer to break down a word sign even if only one of the elements making up that sign is familiar to him (judgment of 22 May 2012 in Aitic Penteo v OHIM — Atos Worldline (PENTEO) , T‑585/10, not published, EU:T:2012:251, paragraph 72). In the present case, as contended by the applicant, it must be held that the word ‘next’ belongs to basic English vocabulary and that its meaning is known to a large portion of the relevant public. It is apparent from the list of the 155 Spanish-registered marks submitted by the applicant that the English word ‘next’ is commonly used on the Spanish market; a fact that EUIPO, moreover, does not dispute. In those circumstances, contrary to the assertions of EUIPO, the relevant public will identify the word ‘next’ within the mark applied for and will immediately grasp its meaning. Moreover, since the earlier mark does not contain such a word, the overall impressions given by the signs at issue will be different for the relevant public. In conclusion, the Court considers that the presence of the element ‘4’ in the earlier mark, which will be visible as a separate element and will be pronounced, together with the very low degree of phonetic similarity of the marks, the fact that only the earlier mark is associated with the concept of magnetism, and the possibility that the word ‘next’ will be identified in the mark applied for, will result in the signs at issue providing distinct overall impressions for the relevant public. The applicant also disputes the Board of Appeal’s assessment that the earlier trade mark has an average distinctive character. In that regard, it must be recalled, first, that a global assessment of the likelihood of confusion implies some interdependence between the factors taken into account and, in particular, between the similarity of the marks at issue and that of the goods or services covered. Accordingly, a low degree of similarity between the goods or services covered may be offset by a high degree of similarity between the marks, and vice versa (judgment of 29 September 1998 in Canon , C‑39/97, EU:C:1998:442 , paragraph 17, and judgment of 14 December 2006 in Mast-Jägermeister v OHIM — Licorera Zacapaneca (VENADO with frame and others) , T‑81/03, T‑82/03 and T‑103/03, EU:T:2006:397 , paragraph 74). Secondly, the more distinctive the earlier mark, the greater will be the likelihood of confusion, and therefore marks with a highly distinctive character, either per se or because of their recognition on the market, enjoy broader protection than marks with a lower distinctive character (judgment of 22 June 1999 in Lloyd Schuhfabrik Meyer , C‑342/97, EU:C:1999:323, paragraph 20). As the Board of Appeal stated in paragraph 19 of the contested decision, the relevant public will associate the earlier mark with objects having magnetic properties (see paragraph 29 above). The applicant produced before the Opposition Division and before the Board of Appeal on 14 March and 21 October 2011 evidence consisting, in particular, of results of internet searches showing that the promotion of the magnetic properties of games and toys is a common practice among operators active in the sector, including the owner of the earlier trade mark, while the Commission had adopted Decision 2008/329/EC of 21 April 2008 requiring Member States to ensure that magnetic toys placed or made available on the market display a warning about the health and safety risks they pose (OJ 2008 L 114, p. 90). According to recital 7 of that decision, magnets had already been used in toys for a long time. Furthermore, the Court takes the view that the elements ‘magnet’ and ‘4’ must be regarded as having an equivalent distinctive character. In those circumstances, it is clear that the earlier trade mark MAGNET 4 conveys a message that may be associated in the mind of the relevant public with characteristics of the goods for which the trade mark is registered, and therefore that it has only a weak distinctive character in spite of the presence of the element ‘4’. Consequently, in the context of a global assessment of the likelihood of confusion, taking into account the low degree of similarity between the mark applied for and the earlier mark, the conceptual differences between the two marks, the presence of the element ‘4’ in the earlier mark alone and the weak distinctive character of that earlier mark, it must be held that the Board of Appeal erred in its assessment in recognising a likelihood of confusion between the marks within the meaning of Article 8(1)(b) of Regulation No 207/2009. Even though the goods covered by the marks in question are partly identical, the overall impression given by each of those marks to a consumer who is a member of the relevant public is sufficiently different to avoid such a likelihood, regard being had, moreover, to the weak distinctive character of the earlier mark. In those circumstances, EUIPO’s decision of 24 April 2012 confirming the decision of 21 June 2011 of the Opposition Division upholding the opposition filed by Diset must be annulled. With regard to the application for rejection of the opposition, it must be noted that, while Article 65(3) of Regulation No 207/2009 authorises the Court to alter the decisions of the Boards of Appeal, that possibility is, in principle, limited to situations in which the case has reached a stage appropriate for judicial adjudication (judgment of 10 June 2008 in Gabel Industria Tessile v OHIM — Creaciones Garel (GABEL) , T‑85/07, EU:T:2008:186, paragraph 28). In the present proceedings, however, it is clear from the contested decision that the opposition examined by the Board of Appeal was based not only on the earlier trade mark but also on the EU figurative mark set out below: The Board of Appeal, having found that there was a likelihood of confusion in regard to the earlier trade mark, did not examine the opposition from the perspective of the EU figurative mark reproduced above and, therefore, did not make any assessment in that regard. Consequently, the case has not reached a stage appropriate for judicial adjudication, with the result that the applicant’s application for rejection of the opposition relating to that mark must be dismissed. Costs In the judgment on appeal, the Court of Justice reserved the costs. It is therefore for the present Court to rule in this judgment on all the costs relating to the various proceedings, in accordance with Article 219 of its Rules of Procedure. 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. Since EUIPO has been unsuccessful, it must be ordered to pay the applicant’s costs, in accordance with the form of order sought by the latter. On those grounds, THE GENERAL COURT (Third Chamber) hereby: 1. Annuls the decision of the Fourth Board of Appeal of the European Union Intellectual Property Office (EUIPO) of 24 April 2012 (Case R 1722/2011-4); 2. Orders EUIPO to bear its own costs and to pay those incurred by Mega Brands International, Luxembourg, Zweigniederlassung Zug. Papasavvas Bieliūnas Forrester Delivered in open court in Luxembourg on 1 June 2016. [Signatures] * Language of the case: English. © European Union The source of this judgment is the Europa web site. The information on this site is subject to a information found here: Important legal notice . 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