Making trademarks work harder

In a series of cases decided by the Court of Justice of the EU over the past 10 years, judges have ruled that trademarks also have an investment function and an advertising function—and made it clear that their list is not exhaustive.

In a session today, a group of academics and practitioners will review some of the leading cases in this area and explain what it means for the scope of trademark protection on offer in Europe.

Tobias Cohen Jehoram, of De Brauw Blackstone Westbroek N.V., who is chairing today’s session, says that the audience can expect a high-level discussion from the panelists, but with plenty of practical advice. Among the issues they will be discussing are the impact of online commerce on trademark functions and the likelihood of the courts extending trademark functions to the goodwill in a brand. They will also be revisiting some of the key cases dealing with trademark functions.

In O2, for example, a case that centered on comparative advertising, Cohen Jehoram says that the Court of Justice created “wriggle room” for itself to define the functions of a trademark. The Court ruled that trademark owers can prevent comparative advertising only if it creates a likelihood of confusion among consumers.

In L’Oréal v. Bellure, the Court was asked to clarify whether the defendants (who produced so-called smell-alike perfumes) could be guilty of infringement even if they had not impaired the essential function of a trademark (that of guaranteeing trade origin).

The Court replied by ruling that a trademark owner can stop a rival from using comparative advertising even when the use does not threaten the essential function of the mark but affects, or might affect, other functions of a trademark, including “guaranteeing the quality of the goods or services in question and those [functions] of communication, investment or advertising.”

The decision was met with some disquiet when it returned to the English courts. Lord Justice Jacob (as he then was) said in his ruling that his own “strong predilection” would have been to hold that “trademark law did not prevent traders from making honest statements about their products where those products are themselves lawful”. He went on to suggest that those functions of a trademark identified by the Court of Justice that go beyond a mark’s essential identifying function (i.e. communication, investment and advertising) were “vague and ill-defined” when separated from the essential function.

More recently, in the keyword advertising case Interflora v. Marks and Spencer, the Court provided guidance about the use of trademarks on the Internet. In particular, it said that the use of a mark as a keyword does not adversely affect the mark’s advertising function. The function of indicating origin, however, is adversely affected if Internet users cannot easily establish whether an advert originates from the trademark owner or one of its rivals.

Cohen Jehoram says that the development of the law has been something of a “puzzle” for lawyers. After all, the law has traditionally focused on protecting consumers from confusion. The recent expansion of the concept of trademark functions and the uncertainty surrounding their exact scope means that it is essential that lawyers provide case-specific advice to their clients. “It’s hard to give general rules and that’s one of the problems in practice in this area in particular,” he says.

CM21 The Functions of a Trademark and Their Impact on Protection takes place from 11:45 am to 1:00 pm today in Ballroom C