The new Article L. 711-2 of the Intellectual Property Code, resulting from Ordinance No. 2019-1169 of November 13, 2019, adds, in accordance with Directive (EU) No. 2015/2436 of December 16, 2015, a number of absolute grounds for refusal or invalidity hitherto absent from the texts.
Indeed, before the 2019 ordinance, the absolute grounds for invalidity were scattered throughout the Intellectual Property Code, between, in particular, Article L.711-2 relating to the distinctive character of the trademark, Article L.711-3 relating to the infringement of public order and morality as well as the deceptive character of the trademark, and finally, Article L.712-6 relating to bad faith.
From now on, article L.711-2 provides for 11 absolute grounds to cancel a registered trademark.
As far as the motivation of decisions is concerned, INPI has adopted a simple style introduced since 2019 by the Conseil d’Etat for the drafting of decisions of administrative jurisdictions (by abandoning, for example, the use of “CONSIDERING”). The methodology for analyzing decisions is also very structured, inspired by that of the decisions rendered by the European Union Intellectual Property Office (EUIPO).
It appears from the decisions rendered since the ordinance came into force that the INPI’s assessment is generally similar to that of the French courts and the EUIPO.
Among the 11 absolute grounds for invalidity identified in article L.711-2 of the Intellectual Property Code, the latest decisions rendered by the INPI essentially show the following 4 grounds: (i) lack of distinctive character; (ii) deceptiveness; (iii) public policy; (iv) bad faith.
The INPI assesses the distinctive character of a trademark in relation to the goods or services for which registration is sought and in relation to the perception that the relevant public has of it, taking into account the criteria established by European case law[1].
In accordance with the case law of the French courts[2]the INPI also recalls that the burden of proof of the sign’s lack of distinctiveness is assessed as of the date of filing and falls on the plaintiff of the invalidity action when the registered trademark benefits from a presumption of validity[3].
The owner of the contested trademark can defend himself by submitting evidence of the acquisition of distinctive character through the use of his trademark. In this respect, the INPI takes into account the factors identified by European jurisprudence[4]the market share held by the mark, the intensity and geographical extent of its use, the duration of the use and the importance of the investments made by the company to promote its mark, as well as the proportion of the interested parties who identify the goods and services as originating from a given company[5].
Finally, it is important to note that article L.711-2 2° enshrines in French law the criterion of “autonomous distinctiveness” already used by French case law[6] according to which the distinctive character of a trademark can be assessed independently of the goods and services concerned. Thus, the INPI has confirmed that “a sign is devoid of distinctive character if it does not, by itself, lead the relevant public to believe that the goods in question originate from a particular enterprise and does not enable it to distinguish them from those of other enterprises“.[7].
If overall, the decisions of the INPI are in line with the European and French jurisprudence, it could seem more severe on certain subjects. Indeed, until recently, the addition of a figurative element allowed to reinforce the distinctiveness of the sign. However, from now on, the INPI seems to be stricter. In particular, it considered that the green color and the presence of vegetal elements, such as leaves, “are part of a common marketing strategy intended to praise the ecological and respectful qualities of the products on which these elements are affixed” and “were therefore not of such a nature, on the day of filing, as to confer distinctive character on the sign“.[8].
Article L.711-2 7° provides that “a trademark contrary to public policy or the use of which is legally prohibited” is void.
European jurisprudence considers that public policy must be distinguished from morality, which are two different but often overlapping concepts. On the one hand, the notion of “public policy” is constituted by the set of legal rules necessary for the functioning of a democratic society and the rule of law. On the other hand, “morality” refers to the fundamental moral values and norms to which a society adheres at a given moment and which are likely to evolve over time and vary in space[9].
The INPI, for its part, has chosen to combine the notions of public order and good morals in a single definition, stating that “The notion of public order and good morals refers to the values and social norms to which society adheres and thus aims to regulate behavior likely to contravene the set of rules imposed by both legislation and social morality“.[10].
The INPI has thus considered as being contrary to public policy or morality the use of a sign likely to disseminate a pornographic message, in particular to minors, or the registration of a sign for products and services related to cannabis (even though the products in question were cannabidiol, the marketing of which is authorized under certain conditions).
Before the Ordinance came into force, the application of the bad faith criterion in matters of trademark nullity applications was based on case law[11]In particular, the combination of the adage “fraus omnia corrumpit” (fraud corrupts all) and the former article L.712-6 of the Intellectual Property Code[12] .
The ordinance transposed this jurisprudential criterion into article L.711-2 11°, which now provides that “a trademark filed in bad faith by the applicant” is void.
On this basis, the INPI has now adopted the interpretation of European and French case law[13] according to which bad faith is constituted when the owner of the contested trademark was aware, at the time of filing, of a prior use of the sign or of similar signs and that his intention at the time of filing was dishonest[14].
Article L.711-2 8° provides that a trademark may not be of such a nature as to deceive the public, in particular as to the nature, quality or geographical origin of the product or service.
The INPI follows the criteria of the European jurisprudence[15] according to which the misleading character supposes that the existence of an effective deception or a sufficiently serious risk of deception of the consumer can be retained. In this respect, it is necessary to take into account the characteristics of the products and services in question, the reality of the market as well as the consumer’s perception, habits and expectations with regard to these products and services.[16]
To this effect, the INPI recalls that “the origin is a decisive element in the choice of consumers, in particular when it comes to food products“, in particular beers[17]and in this respect, it is in line with the judicial jurisprudence prior to the entry into force of the ordinance[18]. However, it refused to accept the misleading nature of the sign “Gang Bang in Paris”, since the grammatical construction implied that it referred to the place where the “activity” was carried out and not to the geographical origin of the goods and services covered by the trademark.
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It follows from the objective of clearing the trademark registers[19] initiated by the 2019 ordinance that “the presentation of a request for invalidation on absolute grounds is not conditional on the demonstration of an interest in acting [20]. Any person may therefore bring a case before the INPI to challenge the validity of a French trademark registered on absolute grounds of invalidity. The order follows the model of the procedures implemented before the EUIPO and breaks with the procedural principles in force before the French courts, which required the demonstration of an interest in acting pursuant to the provisions of Article 31 of the Code of Civil Procedure and which specified in this respect that the cancellation of a trademark for an absolute ground could be invoked “by any interested third party“.[21].
In practice, a company could therefore instruct a trusted third party, such as a law firm, to initiate on its behalf an action for absolute nullity against a third party and thus not reveal its identity. It is recalled, however, that if the interest to act is no longer required, the standing to act is necessary on the basis of article R.716-5 of the Intellectual Property Code[22].
Finally, the INPI has had occasion to remind us on several occasions that the parties must develop arguments to support their claims, on pain of having their application rejected, in accordance with Article R. 716-3 of the Intellectual Property Code. It is therefore not sufficient to simply state that the sign is affected by an absolute ground of invalidity, without any other justification[23].
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The new procedure initiated by the ordinance has favored trademark invalidity actions. Indeed, statistics published by the INPI in February 2022[24] show that, while in 2020, actions for revocation were more numerous than actions for invalidity (55% of actions for revocation against 45% of actions for invalidity), in 2021, the trend was reversed and actions for invalidity became the majority (58% of actions for invalidity against 42% of actions for revocation). It should be noted that the majority of nullity actions are still based on relative grounds.
The door is therefore open to anyone to challenge the validity of a registered trademark, provided they have the relevant arguments.
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