JUDGMENT OF THE GENERAL COURT (Ninth Chamber)
21 December 2021 (*)
(EU trade mark – Opposition proceedings – International figurative registration designating the European Union – Figurative mark HYALOSTEL ONE – Earlier EU word mark HYALISTIL and earlier figurative mark HyalOne – Earlier international word mark HYALO – Relative ground for refusal – Article 8(1)(b) of Regulation (EU) 2017/1001 – Obligation to state reasons)
In Case T‑194/21,
Fidia farmaceutici SpA, established in Abano Terme (Italy), represented by R. Kunz-Hallstein and H.P. Kunz-Hallstein, lawyers,
applicant,
v
European Union Intellectual Property Office (EUIPO), represented by E. Sliwinska and V. Ruzek, acting as Agents,
defendant,
the other party to the proceedings before the Board of Appeal of EUIPO being
Stelis Biopharma Ltd, established in Karnataka (India),
ACTION brought against the decision of the Fifth Board of Appeal of EUIPO of 27 January 2021 (Case R 831/2020-5), relating to opposition proceedings between Fidia Farmaceutici and Stelis Biopharma,
THE GENERAL COURT (Ninth Chamber),
composed of M.J. Costeira, President, M. Kancheva (Rapporteur) and T. Perišin, Judges,
Registrar: E. Coulon,
having regard to the application lodged at the Court Registry on 12 April 2021,
having regard to the response of EUIPO lodged at the Court Registry on 23 June 2021,
having regard to the designation of another Judge to complete the Chamber following the death of Judge Berke,
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        On 14 December 2017, the other party to the proceedings before the European Union Intellectual Property Office (EUIPO), Stelis Biopharma Ltd, filed an application for an international registration designating the European Union with EUIPO pursuant to Regulation (EU) 2017/1001 of the European Parliament and of the Council of 14 June 2017 on the European Union trade mark (OJ 2017 L 154, p. 1).
2        Registration as a mark was sought for the following figurative sign:
3        The goods in respect of which registration was sought are in Class 5 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: ‘Medicinal, nutritional and pharmaceutical preparations and substances’.
4        The trade mark application was published in European Union Trade Marks Bulletin
No 84/2018 of 4 May 2018 under No 1 399 649.
5        On 24 August 2018, the applicant, Fidia Farmaceutici SpA, filed a notice of opposition, pursuant to Article 46 of Regulation 2017/1001, to registration of the mark applied for in respect of the goods referred to in paragraph 3 above.
6        The opposition was based on 16 earlier marks and in particular on those set out below:
–        the EU figurative mark, reproduced below, filed on 22 February 2010 and registered on 2 August 2010 under No 8 899 148, for goods in Class 5 corresponding to the following description: ‘Pharmaceutical preparations; medical and surgical aids for the treatment of traumatic and degenerative diseases of the joints and for orthopaedic surgery’:
–        international registration designating the European Union in respect of the word mark HYALO, filed and registered on 29 July 2016 under No 1 328 073, for goods in, inter alia, Class 5 corresponding to the following description: ‘Pharmaceutical and veterinary preparations; sanitary preparations for medical purposes; dietetic food and substances adapted for medical or veterinary use, food for babies; dietary supplements for humans and animals; plasters, materials for dressings; material for stopping teeth, dental wax; disinfectants; fungicides; medicines; medical products, included in this class, namely substances and preparations of substances for diagnosis, prevention, monitoring, treatment or relief of injuries, diseases, or disabilities; pharmaceutical preparations for dermatological and gynaecological use; parapharmaceutical products for dermatological and gynaecological use; anti-itch creams, gels and sprays for external use [antipruritics]; lubricants for use with condoms; vaginal moisturisers; vaginal washes; personal sexual lubricants; antiseptics; detergents for medical use; pomades and ointments for medical use; tissues or gauzes impregnated with antibacterial preparations, with medical creams or medical lotions; creams, sprays, lotions, gels, or ointments for dermatological purposes, for wound healing and tissue repair; pharmaceutical preparations for the treatment of the mouth and teeth; minerals for medical use; vitamins; dietetic and nutritional supplements’;
–        EU word mark HYALISTIL, registered on 22 October 2015 under No 14 287 338, for goods in Class 5 corresponding to the following description: ‘Pharmaceutical preparations; medicines; medicinal products, namely substances and compositions for diagnosis, prevention, monitoring, treatment or alleviation of disease or injury; eye drops for medical use’.
7        The ground relied on in support of the opposition was that referred to in Article 8(1)(b) of Regulation 2017/1001.
8        On 2 March 2020, the Opposition Division rejected the opposition on the ground that there was no likelihood of confusion with the earlier EU figurative mark HyalOne, which was examined in detail, or with the 15 other earlier marks.
9        On 4 May 2020, the applicant filed a notice of appeal with EUIPO, pursuant to Articles 66 to 71 of Regulation 2017/1001, against the decision of the Opposition Division, focusing its arguments both on the earlier EU figurative mark HyalOne as well as on the earlier EU word mark HYALISTIL and the earlier EU word mark HYALO.
10      By decision of 27 January 2021, the Fifth Board of Appeal of EUIPO dismissed the appeal (‘the contested decision’). In essence, in the first place, it found, in paragraphs 19 to 77 of the contested decision, that there was no likelihood of confusion between the earlier EU figurative mark HyalOne and the mark applied for.
11      In the second place, the Board of Appeal analysed, in paragraphs 78 to 100 of the contested decision, whether there was a likelihood of confusion between the mark applied for and the earlier EU word mark HYALISTIL. In that regard, it found, first, that the relevant public included both average consumers who have a higher-than-average level of attention, in so far as the goods affect their state of health, and professionals in the medical and pharmaceutical fields who have a high level of attention. In addition, although the relevant territory was the European Union, the analysis focused on the Italian-speaking part of the relevant public for which the word element ‘hyal’ of that earlier mark does not evoke the concept of hyaluronic acid. Second, as regards the comparison of the goods, the Board of Appeal concluded that the medicinal and pharmaceutical preparations covered by the mark applied for were identical to the pharmaceutical preparations covered by that earlier mark and that the nutritional preparations and substances covered by the mark applied for were highly similar to the pharmaceutical preparations covered by that earlier mark. Third, as regards the comparison of the signs, it found that they were visually and phonetically similar to an average degree and were neutral from a conceptual point of view on account of the weak distinctive character of the word ‘one’ for the part of the relevant public that did not understand the term ‘hyal’ and on account of the absence of any meaning of the terms ‘listil’ and ‘lostel’ and, therefore, that, for that public that did understand the term ‘hyal’, those signs were similar to a low degree. Fourth, it found that the earlier mark in question had a normal degree of inherent distinctiveness, although it could evoke ‘hyaluronic acid’ for the Italian-speaking professionals in the medical and pharmaceutical fields or for the Italian-speaking part of the general public likely to perceive the term ‘hyal’ as evoking hyaluronic acid, and that the mark applied for also had a normal distinctive character, despite possible allusions to the word ‘one’ and despite the possible evocation of the concept of ‘hyaluronic acid’. Fifth, as regards the global assessment of the likelihood of confusion, it concluded that, taking into account the average degree of visual and phonetic similarity, the conceptual neutrality (for the general public) and the low degree of conceptual similarity (for the professional public), the normal distinctive character of the trade marks at issue, and particularly the higher-than-average to high level of attention, the likelihood of confusion could be excluded for the target public even if the goods were identical or complementary, having regard to the differences noted between the signs in question, in particular the differing vowels – ‘o’ and ‘e’ in the mark applied for and ‘i’ and ‘i’ in the earlier mark – as well as the final word ‘one’ which appears exclusively in the mark applied for.
12      In the third place, in respect of the 14 other earlier marks, including the earlier word mark HYALO, the Board of Appeal found that they were even less similar to the mark applied for and that the applicant had not, in any event, submitted any specific arguments referring to those other earlier marks.
Forms of order sought
13      The applicant claims that the Court should:
–        annul the contested decision;
–        order EUIPO to pay the costs.
14      EUIPO contends that the Court should:
–        dismiss the action;
–        order the applicant to pay the costs.
Law
15      In support of the action, the applicant relies on three pleas in law. The first plea in law alleges infringement of Article 165(1) of Regulation 2017/1001 and Articles 32(f) and 39(5) of Commission Delegated Regulation (EU) 2018/625 of 5 March 2018 supplementing Regulation 2017/1001, and repealing Delegated Regulation (EU) 2017/1430 (OJ 2018 L 104, p. 1). The second plea in law alleges infringement of Articles 94(1) and 95(1) of Regulation 2017/1001 as to the comparison between the earlier word mark HYALO and the mark applied for. The third plea in law alleges that Article 8(1)(b) of that regulation was infringed when the earlier EU word mark HYALISTIL was compared with the mark applied for.
16      As a preliminary point, it should be noted that the applicant disputes the Board of Appeal’s findings as to the assessment of the likelihood of confusion only with regard to the earlier EU word mark HYALISTIL and the earlier word mark HYALO.
17      For reasons of procedural economy, the Court considers that it is appropriate to examine the third plea in law first.
The third plea in law, alleging that Article 8(1)(b) of Regulation 2017/1001 was infringed when the earlier EU word mark HYALISTIL was compared with the mark applied for
18      The third plea in law consists of five complaints. By the first complaint, the applicant alleges that the Board of Appeal incorrectly identified the distinctive and dominant components of the mark applied for and carried out an incorrect examination of the visual, phonetic and conceptual similarities between that mark and the earlier EU word mark HYALISTIL. By the second complaint, it criticises the Board of Appeal’s finding that there is no likelihood of confusion between those marks on the part of the relevant public, in so far as, when conducting the global assessment, the Board of Appeal allegedly relied on a contradictory assessment as to the understanding and perception of the word element ‘hyal’ by that public. By the third complaint, the applicant alleges that the Board of Appeal erred in its assessment as regards the relative weight to be given to the various elements comprising the mark applied for. By its fourth and fifth complaints, it criticises the Board of Appeal for not having taken into account, first, the principle of the interdependence of factors in the global assessment of the likelihood of confusion and, second, the principle of the consumer’s imperfect recollection after purchase.
19      The Court considers it appropriate to examine, first of all, the second complaint of the third plea in law.
20      According to the applicant, it was not open to the Board of Appeal to conclude that there was no likelihood of confusion between the mark applied for and the earlier EU word mark HYALISTIL on the basis of a contradictory assessment as to the understanding and perception of the word element ‘hyal’ by the relevant public. The applicant points out that, on the one hand, the Board of Appeal excluded, in paragraph 97 of the contested decision, the existence of such a likelihood of confusion, taking into account the high level of attention of the relevant public, finding that the term ‘hyal’ in that earlier mark could allude to hyaluronic acid for an Italian-speaking part of that public and therefore have a weak distinctive character and, on the other hand, the Board of Appeal held, in paragraph 28 of that decision, that that part of the public would not perceive that term as evoking the concept of hyaluronic acid and, in paragraph 88 of that decision, that the inherent distinctiveness of that term was normal.
21      EUIPO responds in that regard that the second complaint of the third plea in law, based on an alleged contradiction of grounds, actually concerns the assessment of the substance of the contested decision. Furthermore, EUIPO contends that it is necessary to reconsider whether it is reasonable to assume, for the purposes of the assessment to be carried out in the present case, that a significant part of the relevant public will not understand the prefix ‘hyal’ as alluding to ‘hyaluronic acid’. According to EUIPO, of the relevant public, which is reasonably well informed, observant and circumspect, and having a higher-than-average level of attention, only a negligible part will not understand that the element ‘hyal’ of the signs in question alludes to the concept of ‘hyaluronic acid’. Therefore, EUIPO contends that, in order to examine the substance of the case, it is appropriate to assume that the term ‘hyal’ will be understood by the relevant public and must therefore be considered to enjoy, at best, a low degree of distinctive character.
22      In accordance with the first sentence of Article 94(1) of Regulation 2017/1001, decisions of EUIPO must state the reasons on which they are based. That obligation to state reasons has the same scope as that under Article 296 TFEU, pursuant to which the reasoning of the author of the act must be shown clearly and unequivocally. That obligation has two purposes: first, to allow interested parties to know the justification for the measure taken so as to enable them to protect their rights, and, second, to enable the EU judicature to exercise its power to review the legality of the decision. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons for a measure meets the requirements of Article 296 TFEU must be assessed with regard not only to its wording but also to its context and all the legal rules governing the matter in question. Furthermore, the obligation to state reasons does not require the Boards of Appeal to provide an account that follows exhaustively and one by one all the lines of argument put forward by the parties before them. It is sufficient if it sets out the facts and the legal considerations having decisive importance in the context of the decision. In addition, the reasoning may be implicit, on condition that it enables the persons concerned to know the reasons for the Board of Appeal’s decision and provides the competent Court with sufficient material for it to exercise its power of review (see judgment of 24 March 2021, Kfz-Gewerbe v EUIPO – The Blink Fish (Representation of a fish), T‑354/20, not published, EU:T:2021:156, paragraph 21 and the case-law cited).
23      It is in the light of those considerations that the merits of the applicant’s complaint must be examined.
24      In the present case, it is apparent from paragraph 97 of the contested decision that the Board of Appeal excluded the existence of a likelihood of confusion between the earlier EU word mark HYALISTIL and the mark applied for, finding that the term ‘hyal’ could allude to hyaluronic acid for part of the Italian-speaking relevant public. However, in paragraph 28 of that decision, the Board of Appeal had stated that it would focus primarily on the Italian-speaking part of the public which is more prone to confusion, considering that that part of the relevant public would not perceive that term as evoking the concept of hyaluronic acid.
25      It must therefore be held that the Board of Appeal’s reasoning in relation to the existence of a likelihood of confusion is based on contradictory considerations.
26      A combined reading of paragraphs 26 to 28, 39, 42, 45 to 47, 49, 79, 87, 95 and 97 of the contested decision indeed does not make it possible to determine clearly which part of the relevant public was taken into consideration by the Board of Appeal in order to exclude the existence of a likelihood of confusion between the earlier EU word mark HYALISTIL and the mark applied for.
27      Although it is apparent from paragraphs 26 to 28 of the contested decision, to which paragraph 79 of the same decision refers as regards the comparison between the earlier EU word mark HYALISTIL and the mark applied for, and from paragraph 39 of that decision, that the Board of Appeal focused its analysis on the part of the relevant public that is the most prone to confusion, that is to say, the Italian-speaking part of the relevant public, which would not perceive the term ‘hyal’ as evoking hyaluronic acid, translated into Italian as ‘acido ialuronico’, the Board of Appeal also referred in paragraph 39 to the rest of the relevant public in other EU Member States, in the official languages of which the word ‘hyaluronic’ is translated using highly similar terms, who would perceive that term as evoking hyaluronic acid. It stated that for that latter public that term would therefore have a weak distinctive character in that it referred to an ingredient of the goods concerned.
28      In addition, in paragraph 42 of the contested decision, the Board of Appeal recalled that, according to settled case-law, it is sufficient that a likelihood of confusion exists only for part of the relevant public and that a likelihood of confusion is found on the basis of that part of the public which will not understand the term (see, to that effect, judgment of 20 November 2017, Stada Arzneimittel v EUIPO – Urgo recherche innovation et développement (Immunostad), T‑403/16, not published, EU:T:2017:824, paragraphs 49 and 54 and the case-law cited).
29      Next, in paragraphs 43 to 46 of the contested decision, the Board of Appeal found, first, that, at least for the Italian-speaking part of the relevant public, the term ‘hyal’ would not evoke any meaning, second, that that consumer would perceive that term as a word of foreign origin given that the letters ‘h’ and ‘y’ are used only exceptionally in its language, third, that that consumer would have to convert that term into ‘hyaluronic acid’ and translate it into Italian, that is to say, ‘acido ialuronico’, which was unlikely since too many mental steps would be required to arrive at the meaning related to ‘hyaluronic acid’, and, fourth, that there was no evidence showing the common use of that term to refer to ‘hyaluronic acid’ in Italian or that Italian-speaking health professionals referred to ‘hyaluronic acid’ by using the term in question. The Board of Appeal concluded in paragraph 46 of that decision that there was therefore no reason to believe that ‘part of [the] Italian-speaking average consumers’ would understand the term in question as meaning ‘hyaluronic acid’.
30      However, in paragraph 47 of the contested decision, the Board of Appeal added that it could not be excluded that ‘part of the Italian-speaking general public’ may also perceive the term ‘hyal’ as referring to ‘hyaluronic acid’, without giving further details as to the size of the part of that public likely to perceive it in that way. Furthermore, in paragraph 49 of that decision, the Board of Appeal stated that it followed that that term would be perceived as meaningful or meaningless by the Italian-speaking part of the relevant public. Those considerations, although developed in the context of the comparison between the earlier EU figurative mark HyalOne and the mark applied for, remain relevant in the context of the comparison between the earlier EU word mark HYALISTIL and the mark applied for, taking into account the identical nature of the word element to which they refer, that is to say, ‘hyal’.
31      Therefore, when reading the contested decision, it is not possible to determine what is, according to the Board of Appeal, the size of the part of the relevant public which will perceive the meaning of the term ‘hyal’ and that of the other part of that public which will not perceive that meaning, or on which of those two parts of that public the Board of Appeal relied in order to assess whether there is a likelihood of confusion between the earlier EU word mark HYALISTIL and the mark applied for, or whether the Board of Appeal found that the higher-than-average level of attention had an impact on one or other of those two parts of that public.
32      In accordance with the case-law referred to in paragraph 28 above, it is not necessary to find that a likelihood of confusion exists for the whole of the relevant public. It is sufficient that such a risk exists for a part of the relevant public, provided that it is not a negligible part of that public, in order to uphold a notice of opposition filed against an application for registration of a trade mark (see, to that effect, judgment of 10 February 2021, Herlyn and Beck v EUIPO – Brillux (B.home), T‑821/19, not published, EU:T:2021:80, paragraph 80 and the case-law cited).
33      Thus, the lack of any specification about the part of the relevant public taken as a reference point and about its size is likely to affect the reasoning of the Board of Appeal as a whole. The considerations relating to the distinctive character of the word element ‘hyal’, which appears both in the earlier EU word mark HYALISTIL and in the mark applied for, depend on whether the relevant public understands that term as evoking hyaluronic acid as an ingredient often present in pharmaceutical or cosmetic products and, therefore, on the perception of the descriptive character of that term by that public. The same applies to the considerations relating to the possibility for the relevant public to break the mark down into words which that public understands. Those considerations, set out in paragraphs 86 to 89 of the contested decision, form the basis of the assessments concerning the similarity of the signs in paragraphs 90 to 93 of that decision and, ultimately, the likelihood of confusion in paragraphs 94 to 100 of that decision. In those circumstances, those assessments cannot be understood or reviewed by the EU judicature.
34      Moreover, the lack of clarity in the contested decision cannot be remedied by the clarifications provided by EUIPO in its written pleadings. The reference to the negligible nature of the Italian-speaking part of the relevant public who will not understand the meaning of the word element ‘hyal’ appears for the first time in the response. The same applies to the definition of the weak distinctive character of the term ‘hyal’, whereas, in paragraph 88 of the contested decision, the Board of Appeal found that that term had a normal distinctive character, even if it then contradicted itself in the conclusions as to the inexistence of a likelihood of confusion between the earlier EU word mark HYALISTIL and the mark applied for in paragraphs 97 and 99 of that decision. Thus, even though EUIPO seeks to link those clarifications to what is stated in the Opposition Division’s decision, the fact remains that the Board of Appeal defined the distinctive character of that term in a contradictory manner in paragraphs 88 and 97 of that decision, which does not make it possible to understand unequivocally its assessment of the likelihood of confusion between those marks.
35      In the light of all the foregoing, without there being any need to rule on the first and second pleas in law or on the other complaints formulated in the context of the third plea in law, the contested decision must be annulled in its entirety on the basis of breach of the obligation to state reasons and the case must be referred back to EUIPO, since the Court cannot substitute its own assessment for that which was worded ambiguously by the Board of Appeal regarding the relevant public taken as a reference point in the present case and for all the other assessments based on that assessment.
Costs
36      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.
37      Since EUIPO has been unsuccessful, it must be ordered to pay the costs in accordance with the form of order sought by the applicant.
On those grounds,
THE GENERAL COURT (Ninth Chamber)
hereby:
1.      Annuls the decision of the Fifth Board of Appeal of the European Union Intellectual Property Office (EUIPO) of 27 January 2021 (Case R 831/2020-5);
2.      Orders EUIPO to bear its own costs and to pay those incurred by Fidia farmaceutici SpA in connection with the present proceedings.
Costeira
Kancheva
Perišin
Delivered in open court in Luxembourg on 21 December 2021.
E. Coulon
M. van der Woude
Registrar
President
*      Language of the case: English.