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Adidas wins the Battle of the Stripes

The General Court issued its decisions (T-85/16 and T-629/16) in the latest round of the lengthy (and no doubt costly) dispute between Adidas and Shoe Branding in the battle of the stripes.

The background to this dispute involved Shoe branding filing two EUTMs in 2009 and 2011, respectively, for the below position mark:

https://euipo.europa.eu/copla/image/CJ4JX4FZVCC523YA2TMALSKFLG5GR26TTOTUCH4EDXUE2ZHREOSJAHGTP5WFGYMQWDMTLBYJL7ARO (Shoe Branding)                                                 

The first application covered "footwear" in class 25.  Adidas opposed claiming likelihood of confusion with its various three stripe registrations, including the markhttps://euipo.europa.eu/copla/image/CJ4JX4FZVCC523YA2TMALSKFLE6IBQVRKIWMZTAFLSDJCNH5D54JC5Q53ERKRRLP5DB23IJZJRMTC(Adidas), as well as dilution of the reputation of its brand and confusion with its earlier unregistered mark in Germany.

Despite finding that the substantial evidence submitted by Adidas demonstrated a reputation in its three stripes mark, the marks at issue were found not to be similar and the opposition was refused on all grounds. Adidas appealed. Dismissing the appeal, the Board of Appeal placed significant emphasis on the different positions and number of stripes of the two marks, which were "sufficient to preclude any likelihood of confusion for the reasonably well-informed and reasonably observant and circumspect public, even for identical goods." The General Court disagreed, finding that the Board of Appeal had erred in its comparison of the marks. First, the Board had based its assessment on the differences between the marks but had failed to take into account the similarities also present "... the signs at issue consist of parallel stripes, equidistant and of the same width, which contrast with the background.  Those characteristics of the marks at issue are not elements that could be excluded from assessment of those marks as a whole. Thus, with regard to their configuration, the signs at issue show similarities which should have been taken into account by the Board of Appeal in its global assessment of visual similarity". Second, while assessing the likelihood of consideration, the Board had failed to take into account the evidence submitted by Adidas of the enhanced distinctive character of its earlier mark in the sports shoes and clothing sector. Finally, the Board had failed to recognise that the level of similarity between the marks at issue was not the same under Article 8(1)(b) and Article 8(5). The ECJ has consistently held that a lesser degree of similarity may be required under Article 8(5) than under Article 8(1)(b), provided the similarity between the later-filed mark and the earlier mark with a reputation is "sufficient for the relevant section of the public to...establish a link between them". The Court accordingly upheld Adidas' appeal. 

Dissappointed by this reversal of fortune, Shoe Branding appealed to the ECJ.  The ECJ reaffirmed the General Court's assessment and the case was referred back to the Board of Appeal for review.

In 2011, Shoe Branding filed a second EUTM for the same trade mark to cover "Safety footwear for the protection against accidents or injury" in class 9. Adidas again opposed.  The Opposition Division found, not only that the marks were not similar but that safety footwear was only slightly similar to sports shoes and clothing. By the time the second opposition had reached the Board of Appeal, the General Court had issued its decision in the first opposition proceedings.  Following the General Court's decision in the first opposition therefore, the Board of Appeal  decided to reject the Opposition Division's assessment of the marks and upheld the opposition under Article 8(5) without examining the remainder grounds.

Smilarly, in the first opposition based on foowear in class 25, the Board of Appeal  followed its own findings in the  second opposition and upheld the opposition against Shoe Branding's application in class 25 under Article 8(5) without examining the remainder grounds.  Shoe Branding appealed against both Board of Appeal decisions and the appeals were simultaneously heard by the General Court on 1 March 2018.

In both appeals, Shoe Branding argued that the Board of Appeal wrongly assessed: (i) the evidence of reputation submitted by Adidas, (ii) the existence of damage to the distinctive character or repute of the trade mark, and (iii) the absence of any due cause to use the mark under Article 8(5).  The General Court reviewed the previous decisions in the proceedings and confirmed that the second Board of Appeal had not erred in its assessments. In particular,  the General Court rejected Shoe Branding's claim that the marks at issue had coexisted for a number of years due to Adidas' acquiescence and, accordingly, that it had due cause to use the later-filed mark.  The General Court stated that for a finding of due cause, inter alia, the applied for mark must have been used throughout the territory concerned and the marks must have coexisted peacefully. Not only had Shoe Branding not demonstrated or claimed that its mark was used throughout the EU, the General Court concluded that "...in view of the dispute which arose in Germany in 1990 and of the previous opposition proceedings brought in 2004, the alleged coexistence on the market between the mark applied for or other similar marks of the applicant, on the other hand, and the earlier mark or other similar marks of the intervener, on the other hand, cannot be categorised as peaceful."

It will be interesting to see what, if any, further action Shoe Branding will take to try to protect its two stripes position mark.


Posted by: Yvonne Onomor @ 09.41
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MARQUES does not guarantee the accuracy of the information in this blog. The views are those of the individual contributors and do not necessarily reflect those of MARQUES. Seek professional advice before action on any information included here.

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