JUDGMENT OF THE GENERAL COURT (Sixth Chamber)
21 April 2021 (*)
(Community design – Application for a Community design representing table knives, forks and spoons – Lack of priority claim – Application for restitutio in integrum – Article 67(1) and (2) Regulation (EC) No 6/2002 – Duty of due care)
In Case T‑382/20,
Keun Jig Lee, residing in Paju-si (South Korea), represented by F. Jacobacci and B. La Tella, lawyers,
applicant,
v
European Union Intellectual Property Office (EUIPO), represented by J. Ivanauskas and V. Ruzek, acting as Agents,
defendant,
ACTION brought against the decision of the Third Board of Appeal of EUIPO of 8 April 2020 (Case
R 2559/2019-3), relating to an application for restitutio in integrum,
THE GENERAL COURT (Sixth Chamber),
composed of A. Marcoulli, President, J. Schwarcz (Rapporteur) and R. Norkus, Judges,
Registrar: E. Coulon,
having regard to the application lodged at the Court Registry on 17 June 2020,
having regard to the response lodged at the Court Registry on 23 September 2020,
having regard to the fact that no request for a hearing was submitted by the parties within three weeks after service of notification of the close of the written part of the procedure, and having decided to rule on the action without an oral part of the procedure, pursuant to Article 106(3) of the Rules of Procedure of the General Court,
gives the following
Judgment
Background to the dispute
1        Following an application lodged by Jacobacci & Partners SpA, representative of the applicant, Mr Keun Jig Lee (‘the applicant’s representative’), pursuant to Council Regulation (EC) No 6/2002 of 12 December 2001 on Community designs (OJ 2002 L 3, p. 1), the European Union Intellectual Property Office (EUIPO) registered a Community design on 18 December 2018 under number 5866514‑0001 (‘the contested design’). No priority was claimed at the time that application was filed.
2        The registration of the contested design was notified to the applicant’s representative on 18 December 2018 and was published in Community Designs Bulletin
No 242/2018 on 20 December 2019.
3        On 26 April 2019, on the basis of Article 67(1) and (2) of Regulation No 6/2002, the applicant’s representative filed an application for restitutio in integrum with EUIPO in order for the one-month time limit for the submission of a declaration of priority
to be re-established and authorised EUIPO to debit the corresponding fee from its deposit account. It stated that the contested design claimed priority of the Korean design application filed on 10 June 2018 under No 30‑2018‑0026638, of which it produced a copy and a certified English translation.
4        On 29 April 2019, the applicant’s representative set out the reasons relied on in support of the application for restitutio in integrum. It stated that the applicant had instructed the firm Y.P. Lee, Mock & Partners (‘firm Y.P.’) to file an application for a Community design claiming priority of the application for Korean design No 30‑2018‑0026638, a task which was subsequently allocated to it. Despite the instructions given, the priority claim was not submitted together with the application or in the month following its filing. During the verification, an experienced legal assistant did not detect the error. It was only on
27 February 2019 that the applicant’s representative noticed that an error had been made and that the priority claim had not been submitted on time.
5        By decision of 10 July 2019, the ‘Operations Department’ of EUIPO dismissed the application on the ground that the conditions set out in Article 67(1) and (2) of Regulation No 6/2002 were not satisfied.
6        On 6 September 2019, the applicant’s representative brought an action for annulment of that decision.
7        By decision of 8 April 2020 (‘the contested decision’), the Third Board of Appeal dismissed the appeal, taking the view that the conditions set out in Article 67(1) and (2) of Regulation No 6/2002 were not satisfied. First, it found that the application was inadmissible on the ground that it had not been filed within two months of the removal of the cause of non-compliance with the time limit on 18 December 2018, the date on which the applicant’s representative was notified of the registration of the contested design and should have realised that priority had not been declared. Second, the Board of Appeal stated that, even if the application were admissible, the applicant’s representative has not taken all due care required by the circumstances for which it was responsible. In essence, the Board of Appeal took the view that not only non-submission of the declaration of priority was due to human errors which could not be classified as exceptional or unforeseeable events, but that those errors could not have been detected and corrected by the system of checks and controls put in place by the applicant’s representative. Third and lastly, the Board of Appeal stated that the applicant himself had not taken all due care required by the circumstances since he had failed to check whether his instructions relating to the filing of the contested design had been correctly followed and whether the application for registration of that design included the priority claim.
Forms of order sought
8        The applicant claims that the Court should:
–        annul the contested decision;
–        declare the application for restitutio in integrum admissible and accede to it;
–        order EUIPO to pay the costs.
9        EUIPO contends that the Court should:
–        dismiss the action;
–        order the applicant to pay the costs.
Law
Preliminary observations on restitutio in integrum and the duty of due care
10      Under Article 67(1) of Regulation No 6/2002, the applicant for or holder of a registered Community design or any other party to proceedings before EUIPO who, in spite of all due care required by the circumstances having been taken, was unable to observe a time limit vis-à-vis EUIPO is to, upon application, have his rights re-established if the non-observance in question has the direct consequence, by virtue of the provisions of that regulation, of causing the loss of any rights or means of redress.
11      It is apparent from that provision that restitutio in integrum is subject to two conditions, the first being that the party has exercised all due care required by the circumstances, and the second being that the non-observance of the time limit by that party has the direct consequence of causing the loss of any right or means of redress (see judgment of 31 January 2019, Thun v EUIPO (Poisson), T‑604/17, not published, EU:T:2019:42, paragraph 11 and the case-law cited).
12      It is also apparent from Article 67(1) of Regulation No 6/2002 that the duty to take due care falls in the first instance on the applicant for or proprietor of a Community design or any other party to proceedings before EUIPO. However, if those persons are represented, the representative is subject to the requirement to take due care just as much as those persons. Since the representative acts in the name of and on behalf of the applicant for or proprietor of a Community design or of any other party to proceedings before EUIPO, his acts must be considered as being those of those persons (see, to that effect, judgment of 31 January 2019, Poisson, T‑604/17, not published, EU:T:2019:42, paragraphs 18 and 19 and the case-law cited).
13      It should also be borne in mind that, according to the case-law, the expression ‘all due care required by the circumstances’ in Article 67(1) of Regulation No 6/2002 requires a system of internal control and monitoring of time limits to be put in place which generally excludes the involuntary non-observance of time limits. It follows that restitutio in integrum may be granted only in the case of exceptional events, which cannot therefore be predicted from experience (see judgment of 31 January 2019, Poisson, T‑604/17, not published, EU:T:2019:42, paragraph 31 and the case-law cited).
14      Furthermore, observance of time limits is a matter of public policy and restitutio in integrum is liable to undermine legal certainty. Consequently, the conditions for the application of restitutio in integrum must be interpreted strictly (see by analogy, judgment of 19 September 2012, Video Research USA v OHIM (VR), T‑267/11, EU:T:2012:446, paragraph 35).
15      Finally, it must be borne in mind that, under Article 67(2) of Regulation No 6/2002, an application for restitutio in integrum must be filed in writing within two months of the removal of the cause of non‑compliance with the time limit.
16      In support of his action, the applicant relies on two pleas in law, the first alleging infringement of Article 67(2) of Regulation No 6/2002 and the second alleging infringement of Article 67(1) of that regulation.
17      EUIPO contends that the two pleas relied on by the applicant should be rejected. It submits that the Board of Appeal was correct in finding that the application was inadmissible since it had not been submitted within the period of two months laid down in Article 67(2) of Regulation No 6/2002 and that, in any event, even if it were admissible, the application had to be dismissed as unfounded on the ground that neither the applicant’s representative nor the applicant himself had taken all due care required within the meaning of Article 67(1) of Regulation No 6/2002.
18      It is in the light of the preliminary considerations set out in paragraphs 10 to 15 above that it is necessary to assess whether the Board of Appeal was correct to find that the conditions set out in Article 67(1) and (2) of Regulation No 6/2002 were not satisfied in the present case.
19      The Court considers it appropriate to examine first the second plea and then, if necessary, the first plea.
The second plea in law, alleging infringement of Article 67(1) of Regulation No 6/2002
20      By that plea, the applicant claims that the Board of Appeal infringed Article 67(1) of Regulation No 6/2002 in finding that neither his representative nor the applicant himself had taken all due care required by the circumstances.
21      In the present case, the applicant, the holder of the contested design, chose firm Y.P. to file an application for a Community design claiming priority of the application for Korean design No 30‑2018‑0026638, which then delegated that task to the applicant’s representative (see paragraph 4 above).
22      In those circumstances and in the light of the case-law cited in paragraph 12 above, while it is true that both the applicant and firm Y.P., as well as the applicant’s representative were subject to the requirement to exercise due care, that requirement, in principal and primarily, lies with the applicant’s representative (see, to that effect, judgment of 23 February 2016, Pirelli Tyre v OHIM (Tyre treads and Others), T‑279/15 to T‑282/15, not published, EU:T:2016:92, paragraph 19).
23      The Board of Appeal noted several circumstances which led to the failure to claim priority of the contested design
and relied essentially on the applicant’s representative’s failure to exercise due care, as is apparent from paragraphs 21 to 25 of the contested decision. It found, in essence, that
that
failure to claim priority was the result of human errors, which
could not have been detected because there was no effective system of checks and controls.
24      At the outset, it should be noted that the applicant does not dispute that his representative committed
errors. However, he claims, in essence, that those errors constituted an exceptional event, statistically possible but incredibly
rare in an efficient organisation system backed up with multiple controls such as that put in place by his representative, which consists of three separate stages. He also notes that it is the first error of that kind in more than 2 300 applications for registration of designs by the representative since 2003.
25      The applicant states, in particular, that his representative’s legal assistants in charge of the file duly followed the three stages of the verification procedure. According to the applicant, the errors occurred due to both the omission of the declaration of priority by an experienced legal assistant during the first phase of the procedure by marking the corresponding box in EUIPO’s online form, and to the failure to detect that omission during the verification carried out by an experienced legal assistant during the second phase of the procedure, which led that
legal assistant to agree to the filing of the application for registration for the purpose of the third phase of the procedure.
26      According to the applicant, in view of the experience and high level of qualification in that field of
the legal assistants responsible for the file, as well as the system of checks put in place by his representative which, in principle, was very effective, that single failure in the verification system must be regarded as an isolated incident, which is statistically possible. It is clear that the omissions that occurred were the result of an unfortunate combination of events that was so unforeseeable as to make it entirely improbable that it would occur once, or that it could occur again in the future. That error was therefore not caused by a general failure of the management system, which was so effective that it had never failed until that point.
27      In the first place, it is therefore necessary to examine whether the Board of Appeal correctly established that the applicant’s representative had failed in its duty to exercise due care because of the two human errors which it acknowledges having been committed.
28      In that regard, it must be noted that the General Court has already held that human errors in inputting data cannot be regarded as exceptional or unforeseeable events which cannot be predicted from experience even in cases where staff have been adequately trained, and adequately instructed and supervised (see, to that effect, judgments of 13 May 2009, Aurelia Finance v OHIM (AURELIA), T‑136/08, EU:T:2009:155, paragraph 28, and of 19 September 2012, VR, T‑267/11, EU:T:2012:446, paragraph 24). Therefore, the Board of Appeal rightly found that the errors committed by the
applicant’s representative’s two legal assistants which had led to the omission of the declaration of priority constituted a failure to comply with its duty to exercise due care.
29      In the second place, it is necessary to examine the failure to detect errors by the system of checks and controls put in place by the applicant’s representative.
30      In that regard, the General Court has already held, in connection with the renewal of marks entrusted to a specialised company using a computerised renewal reminder system, that the due care required by the circumstances in particular required that that system was capable of detecting and correcting any foreseeable error in the functioning of the computerised system (see, to that effect, judgments of 13 May 2009, AURELIA, T‑136/08, EU:T:2009:155, paragraph 27, and of 19 September 2012, VR, T‑267/11, EU:T:2012:446, paragraph 26).
31      Contrary to the applicant’s assertions, it must be held, first, that the omissions of his representative’s two legal assistants are foreseeable errors and, second, that the system used by his representative did not enable such foreseeable errors to be detected and corrected. As EUIPO correctly submits, it must therefore be held that a system of internal control and monitoring of time limits which, in essence, was based on one person controlling the work of the other cannot generally preclude involuntary non-compliance with time limits.
32      Therefore, it is necessary to uphold the Board of Appeal’s finding that, in essence, the applicant has not shown that his representative had taken all due care required by Article 67(1) of Regulation No 6/2002 in order for restitutio in integrum to be possible, since foreseeable human errors were made, which could not have been detected in the absence of an effective system of checks and controls.
33      That finding cannot be called into question by the applicant’s argument that, in essence, unlike the case that gave rise to the judgment of 13 May 2009, AURELIA (T‑136/08, EU:T:2009:155), the present case concerns only a single failure of the verification system and not a general failure, as is shown by the fact that that system has never failed until that point. According to the applicant, the Board of Appeal thus misinterpreted the criteria established in that case by applying them in the present case.
34      At the outset, that argument must be rejected since, as EUIPO observes, it is not substantiated by any evidence. Furthermore, contrary to the applicant’s claims, it must be noted that the Board of Appeal did not misinterpret and misapply the principles arising from the case that gave rise to the judgment of 13 May 2009, AURELIA (T‑136/08, EU:T:2009:155). It must be stated that there are numerous similarities between those two cases in that the applicants were criticised for failure of the system due to the fact that, exceptionally, one or more employees of the specialist firm did not input the required data and that those errors were not detected. In both cases, it was held that such errors were foreseeable and that a system ought to have provided for a mechanism for detecting and correcting such errors. Since a system enabling those errors to be detected had not been set up, the Board of Appeal found that the applicants had failed in their duty to exercise due care. The Board of Appeal was therefore entitled to rely in the present case on the principles identified in the judgment of 13 May 2009, AURELIA (T‑136/08, EU:T:2009:155), as also adopted in the case which gave rise to the judgment of 19 September 2012, VR (T‑267/11, EU:T:2012:446).
35      As regards the applicant’s reference to the judgment of 25 April 2012, Brainlab v OHIM (BrainLAB) (T‑326/11, EU:T:2012:202), which held that exceptional errors in the monitoring system could be regarded as excusable, it should be recalled, in accordance with the case-law cited in paragraph 14 above, that the conditions for the application of restitutio in integrum must be interpreted strictly. In addition, even if such circumstances could be categorised as an excusable error, they include a subjective element involving the obligation, on the part of the party acting in good faith, to exercise all the care and diligence required of a normally well-informed trader to monitor the course of the procedure set in motion and to comply with the prescribed time limits (see to that effect and by analogy, judgment of 21 May 2014, Melt Water v OHIM (NUEVA), T‑61/13, EU:T:2014:265, paragraph 38 and the case-law cited). In the present case, in the light of the finding in paragraph 32 above and the considerations set out in paragraphs 12 and 13 above, it must be held that the applicant has not taken the due care required by Article 67(1) of Regulation No 6/2002, with the result that the errors made cannot be regarded as excusable.
36      Therefore, it must be held that that sole ground enabled the Board of Appeal to conclude that the first condition of Article 67(1) of Regulation No 6/2002 was not satisfied, irrespective of the question, addressed in paragraph 26 of the contested decision, of whether the applicant had himself taken all due care required by the circumstances.
37      It is true that a check by the applicant or firm Y.P. to ensure that the instructions relating to the filing of the contested design had been correctly followed and that the application for registration of that design included the priority claim could have mitigated the errors committed by the applicant’s representative.
38      However, it is to be borne in mind that, according to the case-law referred to in paragraph 12 above, since the representatives of the holder of a Community design act on behalf of and in the name of the holder, their actions must be regarded as being the holder’s actions. Likewise and by analogy, as the General Court has already held concerning the remission of customs duties, the negligence of the representative is to be taken into account in the same way as that of the interested party (judgment of 30 November 2006, Heuschen & Schrouff Oriëntal Foods v Commission, T‑382/04, not published, EU:T:2006:369, paragraph 94). It follows that the applicant, firm Y.P. and the applicant’s representative before EUIPO
appear to constitute a single entity for the purposes of the proceedings before EUIPO and that the failure to comply with the requirement to exercise due care incumbent on the representative must be considered to be the failure of the proprietor for the purposes of those proceedings. Consequently, the question whether the applicant or possibly firm Y.P. displayed a sufficient level of diligence is relevant only from the point of view of their contractual relations, but cannot affect their legal position vis-à-vis EUIPO (see, to that effect and by analogy, judgment of 19 September 2012, VR, T‑267/11, EU:T:2012:446, paragraph 40).
39      Therefore, as the
applicant’s representative’s lack of due care is the direct cause of the lack of the priority claim, the question whether, contrary to the Board of Appeal’s finding in paragraph 26 of the contested decision, the applicant took all due care is not relevant from the point of view of the legality of the contested decision, with the result that the applicant’s arguments in that regard must be rejected as being ineffective.
40      It follows from all of the foregoing that, since the Board of Appeal rightly took the view that it was not necessary to order restitutio in integrum, it is appropriate to reject the second plea in law and, therefore, the action in its entirety, without it being necessary to rule on the first plea in law relating to the admissibility of the application for restitutio in integrum nor on the second head of claim.
Costs
41      Under Article 134(1) of the Rules of Procedure of the General Court, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the applicant has been unsuccessful, he must be ordered to pay the costs, in accordance with the forms of order sought by EUIPO.
On those grounds,
THE GENERAL COURT (Sixth Chamber)
hereby:
1.      Dismisses the action;
2.      Orders Mr Keun Jig Lee to pay the costs.
Marcoulli
Schwarcz
Norkus
Delivered in open court in Luxembourg on 21 April 2021.
E. Coulon
S. Papasavvas
Registrar
President
*      Language of the case: English.