RELIEF - CJEU confirms EUIPO practice contrary to AG Cápeta opinion in APE TEES

We reported on Advocate General (AG) Cápeta’s opinion in the APE TEES case (C-337/22 P, aka Nowhere, the name of the applicant before the GC) here expressing the hope – in fact expectation – that the CJEU would not follow that opinion. We are very relieved to report that this expectation has not been disappointed.

Commercial logic and equity prevailed over formalism. In today’s ruling, the CJEU confirmed in clear terms (para. 173):

[The] earlier right must continue to exist until the date on which EUIPO rules on the opposition based on that right, including at the stage of the appeal before the Board of Appeal […].

In this case, the earlier right (an alleged unregistered UK trademark right) had ceased to be an “earlier right” in the EU following Brexit. However, the question before the CJEU was not limited to Brexit situations but was much broader, concerning the loss of validity of an earlier right in the course of the proceedings for whichever reason, for example non-use cancellation, surrender, or expiry.

The EUIPO has always considered that the earlier right must be valid and enforceable at the time of the decision on the substance. Of course, the earlier right must also have been valid and enforceable at the application or priority date of the contested trademark (application), for opposition and invalidity proceedings alike, as otherwise there is no prior right to begin with. Both dates are relevant. Where the earlier right loses validity in between, there is no longer a conflict between valid rights and the owner of the (former) prior right has no legitimate interest in preventing or cancelling the registration of a later trademark.

The CJEU’s confirmation of this understanding of the EUIPO is rotund. The various arguments made to justify the contrary understanding, namely, that an opposition or invalidity action should be granted even if the earlier mark, at the time of the decision, no longer exists, are one by one taken apart, resulting in a textbook judgment of 182 paragraphs.

For those interested in EU trademark proceedings, however, the main message is simple: if the earlier mark “goes away”, so does the conflict, and there is no ground for refusal or invalidity of a later trademark.

This means for the appeal in SHOPPI (earlier posts on that see here and here) that it will inevitably fail if it is not withdrawn. In that case, the GC had taken exactly the position now confirmed by the CJEU. That SHOPPI concerns an invalidity action and not an opposition makes no difference – the CJEU repeatedly refers to both opposition and invalidity proceedings alike.

The judgment is also binding for national IP offices in the EU Member States – which, to the knowledge of this author, means that no change in practice is required. Famously, the UKIPO follows the opposite approach, considering only the status of the earlier mark at the application or priority date of the mark under attack. UK practitioners often defend that approach (see for example here) – but where a UK application from before the end of 2020 fails, after drawn out proceedings, only because of an earlier EU trademarks that was and is used only in the EU, that is (rightly) perceived as unfair.

By way of reminder, if the earlier right loses validity after the Board of Appeal decision, that is considered not to matter, because Board decisions cannot be challenged based on facts that arise after the last administrative decision. This was discussed in depth in Basmati (we reported here). In practice, this means that, when confronted in EUIPO proceedings with an earlier right the validity of which can be challenged, don’t wait till after the Board’s decision, as that may be too late!

This author is greatly relieved that we do not need to re-learn trademark law but can continue to apply the strategies that have worked before the EUIPO for 30 years.