Source: https://www.pbip.com/news/76-impulse-territorial-reputation-clarified
Timestamp: 2019-04-23 19:59:50+00:00

Document:
Iron & Smith made an application for a national figurative mark containing the words “be impulsive” at the Hungarian IPO in 2012. Unilever opposed this application by referring to their earlier Community trade mark (‘CTM’) (now known as an EU Trade Mark) for the word “IMPULSE”. Unilever argued, in accordance with Article 4(3) of the European Trade Marks Directive, that their CTM was a mark with a reputation, and that Iron & Smith’s mark was identical or similar to the CTM and the national mark would take unfair advantage of, or caused detriment to the distinctive character or repute of their CTM.
The Hungarian IPO found that even though Unilever’s CTM did not have a reputation in Hungary, it did have a reputation in England and Italy. They found that this was sufficient to say the CTM had a reputation in a substantial part of the EU and since there was a risk that Iron & Smith’s mark would take unfair advantage of the CTM the application was refused. As a result Iron & Smith applied to the higher Hungarian court for a variation of this decision. The Hungarian count felt that as Article 4(3) of the Trade Marks Directive does not give guidance as to the territoriality of reputation in a CTM, it should refer the matter to the Court of Justice of the EU.
Can a CTM have a reputation if it has a reputation in one member state and does it matter if the trade mark application being opposed is being applied for in another member state?
Should the law regarding genuine use of a CTM be applied in the context of the territorial criteria that is used when examining the reputation of such a mark?
If the earlier CTM is shown to have a reputation in a substantial part of the EU, but not in the member state in which the application for the later mark is made, must the CTM owner also be required to provide conclusive proof of reputation in the member state as well?
If the answer to question 3 is no, then will the earlier CTM that has a reputation in a substantial part of the EU fail to meet the second requirement of Art. 4(3) of the TM Directive requiring that the earlier CTM holder must show risk of detriment or unfair advantage to the repute or distinctive character of the mark? If so, what facts must the earlier CTM owner prove in order for the second condition to be met?
The CJEU gave its decision in September 2015. It assessed the first three questions together as they related specifically to the issue of reputation. The CJEU stated that the ‘reputation’ of a mark assumes a certain degree of knowledge amongst the relevant public, and that degree is reached when a significant part of the public knows of the mark in relation to the goods and/or services covered by that mark. A national court must take into account all the relevant facts of the case, in particular the market share held by the mark, the intensity, geographical extent and duration of its use, and the size of the investment made by its owner in promoting it.
In terms of territory, the CJEU said that the condition as to reputation will be fulfilled if the CTM has a reputation in a substantial part of the EU. In some circumstances, it may be sufficient that the earlier CTM has reputation in just one member state. As such, if an earlier CTM is found to have a reputation in a substantial part of the EU then the rights owner need not provide evidence of reputation when opposing a national trade mark application in another member state.
The CJEU also concluded, in relation to question 2, that the provisions relating to genuine use are simply not relevant to Article 4 of the TM Directive as genuine use provisions pursue a different objective than those that relate to marks with a reputation since the protection for such marks extends beyond the goods and/or services for which they are registered.
In respect of question 4, the CJEU said that if the public concerned in the country where the later mark is being applied for does not make a connection or link between the earlier CTM and the later national trade mark then unfair advantage and/or detriment cannot be found.
Accordingly, the CJEU concluded that the owner of an earlier CTM with a reputation in another member state may rely on the protection provided by Article 4(3) if it can show that a commercially significant part of the public in the member state where the later mark is being applied for is familiar with the earlier CTM, they make a connection between the two marks and there is actual injury or a serious risk of injury to the earlier CTM.
This case shows that a rights owner can leverage their CTM to oppose national trade mark applications provided the CTM has a reputation in a substantial part of the EU, and that this reputation does not necessarily have to be established in the member state in which the national trade mark is being opposed. However, the owner of the CTM will also have to show that a commercially significant part of the public in the member state where it is being applied for is familiar with the earlier CTM, that public makes a connection between the two marks and show there is actual injury or a serious risk of injury to the earlier CTM.

References: Art. 4
 CJEU 
 CJEU 
 CJEU 
 CJEU 
 CJEU 
 CJEU