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If You’re Slow Off The Mark – Use It Or Lose It!

07 Sep 2017

When Lewis Hamilton won the 2017 Italian Formula One (“F1”) Grand Prix at Monza in his German [albeit British designed, built and based] Mercedes-AMG F1 car to top the F1 leader board it did not go down that well with the local Ferrari supporting Italians. 

The result of the Italian F1 Grand Prix follows on from another recent adverse outcome suffered by Ferrari to German opposition with a decision of the Düsseldorf District Court to revoke Ferrari’s German Trade Mark for “Testarossa”.

 

Background & The Law

The Ferrari Testarossa was Ferrari’s top of the range vehicle in the 1980s and, during its production run from 1984 to 1996, it achieved a symbolic status in popular culture including appearing in several series of the US television crime drama, Miami Vice, as well as being the car featured in the 1980s classic Sega arcade game OutRun.

German Trade Mark Law, as with the trade mark legislation in every other European Union (“EU”) Member State including the United Kingdom, is derived from harmonised EU trade mark legislation which was revised and recast again in the 2015 Trade Marks Directive (2015/2436) (the “Directive”). 

Article 19(1) of the Directive, which accords with similar provisions in the earlier EU trade mark legislation, states that “A trade mark shall be liable to revocation if, within a continuous five-year period, it has not been put to genuine use in the Member State in connection with the goods or services in respect of which it is registered, and there are no proper reasons for non-use.”

Ferrari’s German trade mark for “Testarossa” was registered in 1990 in class 12 covering "Land, air and water vehicles and parts thereof;  Engines for land vehicles;  Car accessories, namely trailer couplings, luggage carriers, ski carriers, dirt traps, snow chains, wind deflectors, headrests, safety belts, safety child seats”

As a result of an ongoing battle with a German businessman, Kurt Hesse, who has faced opposition from Ferrari in his attempt to register “Testa Rossa” for, amongst other things, electric bicycles, Herr Hesse sought the revocation of Ferrari’s German Trade Mark for “Testarossa” on the ground that Ferrari had not put it to genuine use for at least five years. 

 

Ferrari’s Arguments

Ferrari argued that it had used the “Testarossa” mark:-

  1. For maintenance, repair, spare parts production and certification;
  2. By continuous application and trade with used sports cars certified by it; and
  3. Relying on its interpretation of European Court of Justice (“ECJ”) case law in the cases of L'Oréal / Bellure, Google France and Google and Interflora that a trade mark is also genuinely used to the extent that it is used at least according to one of the other trade mark functions of quality, advertising, communication and investment.

 

The Decision

The Düsseldorf District Court however held that:-

  1. Ferrari had not provided sufficient evidence of use of the “Testarossa” mark for maintenance, repair, spare parts production for this to amount to genuine use of the “Testarossa” mark;
  2. The trade by Ferrari in certified used Testarossa sports cars did not to constitute use of the “Testarossa” mark as the trade mark rights in these vehicles were exhausted when Ferrari originally placed them on the market; and
  3. Contrary to Ferrari’s view, the ECJ case law does not support the position that a trade mark is genuinely used in the sense when it is used according to one of the other trade mark functions of quality, advertising, communication and investment, but not as a commercial source of income. 

 

In light of the above, the Düsseldorf District Court upheld Herr Hesse’s application and ordered the revocation of Ferrari’s German Trade Mark “Testarossa”.

 

Lessons To Learn

The decision is not the end of the road for Ferrari and there will be a few more twists and turns in their battle with Herr Hesse as they have the right to appeal the decision of the Düsseldorf District Court and they also hold a separate EU wide Trade Mark for “Testarossa” covering the 28 current EU Member States.

The decision is nevertheless a salutary lesson for all trade mark proprietors of the risk they potentially face should they not put their trade marks to genuine use for a continuous period of five years.  As a matter of public policy and to encourage enterprise, governments and their Intellectual Property Offices do not want Trade Mark Registers filled with trade marks that are no longer in use by their proprietors. 

Trade Mark proprietors should therefore undertake audits of their IP portfolios with their advisors on a regular basis in just the same way as the owner of a car would seek obtain a service and MOT in order to stay on track and minimise the chance of future hazards in their way.

 

DMH Stallard has a specialist team of intellectual property specialists who can advise and assist further on the range of IP enforcement options available for clients. 

For more information contact James Martin at James.R.Martin@dmhstallard.com or on +44 (0)20 7842 1509

 

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