Reposted from DLA Piper’s Law à la Mode Edition 4 – Winter 2011

By:  Michael K. Barron, Sarah Phillips and Nadea Taylor (Boston and London)
“AdWords,” the paid, subscription-based Google referencing service which allows users to advertise their companies alongside Google search results, has recently been the subject of much legal scrutiny.  In late September, the European Court of Justice (ECJ) gave a preliminary ruling on questions referred to it by the English High Court in the case between Interflora and Marks & Spencer (“M&S”), regarding the purchase by M&S of the Google AdWord “Interflora” and other similar AdWords. 
In answering the questions referred to it, the ECJ repeated much of the recent jurisprudence in this area, in particular from the Google France case.  Previous cases established that purchasing a third parties’ trademark as an AdWord would only amount to trademark infringement if such use would have an adverse effect on one of the functions of the trademark.  
The ECJ gave the following guidance on how national courts should assess whether the use by a third party of a sign identical with a trademark in relation to identical goods or services has an adverse affect on one of the functions of the trademark:

By: Stefania Baldazzi and Annalaura Avanzi  (Milan)

In 1967, the well-known Italian fashion designer Elio Fiorucci founded the fashion brand Fiorucci S.p.A.  After more than two decades of success in Italy and around the world, Mr. Fiorucci sold the company and all of its creative assets to the Tokyo Company Edwin Co. Ltd in 1990.  The sale encompassed all the Fiorucci trademarks, including numerous marks containing the element “FIORUCCI.”

In 1999, Edwin Co. registered the mark “ELIO FIORUCCI,” by filing an application with the Office for Harmonization for the Internal Market (OHIM), which is a body of the European Commission, for a broad category of goods, including cosmetics, apparel, footwear and leather products. 

Mr. Fiorucci Fights to Protect his Name

In 2003, Mr. Fiorucci filed an application for revocation and declaration of invalidity of the mark “ELIO FIORUCCI” with the Cancellation Division of OHIM pursuant to Italian law, in an attempt to protect his personal ownership of his name.  The OHIM Cancellation Division dismissed the application for revocation but granted the application for declaration of invalidity relying on  Section 8(3) of the Italian Industrial Property Code (IIPC) which states:  “If they are well known, the following may be registered as a trade mark by the proprietor or with the consent of the latter:  personal names, signs used in the artistic, literary, scientific, political or sporting field . . .  The Cancellation Division stated that, in order to register Mr. Fiorucci’s name as a Community trademark, Edwin Co. should have obtained the prior consent of the name’s holder.

Edwin Co. Appeals the Decision and Mr. Fiorucci Continues the Battle

In response to Edwin Co.’s appeal, OHIM’s First Board of Appeal annulled the decision arguing that “this situation did not fall within the scope of Article 8(3) of IIPC whose purpose is to prevent third parties from exploiting for commercial purposes the name of a person who had become famous in a non-commercial sector and is not applicable to this hypothesis.”

In 2006, Mr. Fiorucci challenged the Board of Appeal’s ruling with the Registry of the General Court.  The Court rejected the Board of Appeal’s findings.  It confirmed that OHIM may declare a Community trademark to be invalid, on application by the interested party, if its use can be prohibited pursuant to the right to a name, as it is protected by national law (which in this case, was Italian law).

The CJEU Decision and Its Implications

In July of this year, the Court of Justice of the European Union (CJEU) upheld the General Court’s decision, stating that the holder of a well-known personal name is entitled to prevent its use as a Community trademark where there are national laws in place supporting this level of protection.

This decision is significant because it underscores the importance of national intellectual property law, even when international use is implicated.  Moreover, the twelve year legal battle that ensued serves as a cautionary tale for fashion designers operating businesses where their own personal name has become synonymous with the inherent commercial value of a brand or its products—and perhaps should become a central inquiry at the time of a successful business’ sale.  A fashion designer’s right to his or her name creates an interesting series of legal issues, and trademark lawyers should continue to watch international developments regarding Community trademarks.