Fraudulent Name Trademarks: A Comparison Between the United States, the European Union, the United Kingdom and China (Part III of IV)

Introduction:

In Part II of this series, we explored how United States law and practice addresses trademark applications covering indicia of persona – such as a signature, voice or likeness. In particular, we examined how United States law places the onus of demonstrating the legitimacy of such trademark applications on applicants.

However, both European Union and United Kingdom trademark law and practice take a different approach. In general, the European Union does not require applicants to prove the legitimacy of an application at the time of filing while the United Kingdom does, but only under certain circumstances. This article “digs deeper” and explores in greater detail the European Union and United Kingdom trademark law and practice concerning the registration of the indicia of persona.

European Union Law:

In general, under Regulation 2015/2424, a European Union trademark application will be registered if it is capable of distinguishing the applicant’s goods and services from those of other undertakings and:

“may consist of any signs, in particular words, including personal names, or designs, letters, numerals, colours, the shape of goods or of the packaging of goods, or sounds” (emphasis added).

While the European Union – like the United States – allows the registration of “personal names,” there are many differences between European Union and United States trademark law.

In contrast to the United States, the European Union Intellectual Property Office (E.U. IPO) does not require a written consent as a condition of registering a living person’s persona, such as his or her name, portrait or signature. Rather, in general, policing third party trademark filings covering a particular living individual’s persona (such as a name or image) in the European Union is the responsibility of that particular living individual.

For example, in general, the EUIPO does not require any information / consent where registration is sought for a celebrity’s name. Indeed, our firm can attest to this policy inasmuch as we have helped internationally-known celebrities secure trademark rights through the E.U. IPO – without ever being asked to provide a written consent from our clients.

Rather, individuals bear the burden of instituting an opposition or a cancellation action under Article 59(1)(b) to attack third party trademark applications / registrations which include that individual’s name, portrait, signature, etc. Article 59(1)(b) provides that EU trademarks are invalid:

“where the applicant was acting in bad faith when he filed the application for the trade mark”

In other words, in the E.U., a celebrity needs to show that a third party application for his or her name, portrait, signature, etc. was filed in “bad faith.” While we submit that this is a straightforward procedure – it is hard to imagine a non-bad faith justification for seeking to register a trademark in a someone else’s persona – such a procedure:

can nonetheless be burdensome and expensive; and

puts the full onus of enforcement on the impacted individual.

Monitoring Costs and Squatter Applications:

Unfortunately, monitoring trademark filings around the world can be expensive, and many rights holders forego the expense of such monitoring. Sometimes, this proves “penny wise and pound foolish” when rightsholders discover squatter trademark applications after it is too late.

In extreme instances, celebrities even discover squatter trademark registrations – sometimes years after filing. Often, such squatter filings are not discovered until a celebrity’s brand is ready to expand into a new market and, for the first time, conducts a search of trademark filings in that market.

By way of illustration, an American celebrity might launch an eponymous fashion line in the United States. Seeing this success, a nefarious third party may rush to file a trademark application in the European Union covering this same name. If the celebrity fashion line is not conducting sales in the European Union, it could be months or years before this squatter filing comes to light. When it finally comes to light, the celebrity will find themselves confronted with a difficult, indeed with possibly an impossible, battle – leaving them with few alternatives other than to “pay off” the third party.

E.U. Name Trademarks Against Public Policy or Morality:

EU Regulation 2017/100, Article 7(1)(f) prohibits registration of:

“trade marks which are contrary to public policy or to accepted principles of morality”.

In some limited cases, the EUIPO has refused registration (or cancelled existing registrations) under Article 7(1)(f) where a trademark is considered “offensive.”

In one notable example, two U.K. residents successfully registered ATATURK (the name of the founding father of modern Turkey) in 2006 (EU Reg. No. 004633434). This registration covered a number of goods, including arguably “unflattering” or offensive goods such as “preparations for destroying vermin,” “fungicides,” “herbicides,” and “beers.”

In 2011 – five years after a registration was secured – the Republic of Turkey initiated a cancellation action on the grounds that the ATATURK mark was offensive to Turks. The E.U. IPO’s Boards of Appeal concluded that:

the relevant segment of the general public for purposes of evaluating offensiveness was “the average consumer of the European general public of Turkish origin”;

such segment was “nonnegligible”; and

the “highly positive” word ATATURK was used in a banal way.

Thus, the Boards of Appeal declared the registration invalid.

Similarly, any rights holder wishing to register a person’s name (particularly that of a deceased, famous individual) – or wishing to attack the registration of a person’s name – should consider these regulations. For example:

it may be easier to secure trademark rights in a name for goods / services which are considered noble (e.g., for certain charitable services) than for goods / services which are perceived as common place (e.g., clothing); and

it may be easier to secure trademark rights in a name for goods / services which are considered common place (e.g., clothing) than goods / services which could be considered inappropriate or scandalous by a nonnegligible segment of the European general public (e.g., manure, pornographic literature, etc.).

A European Right(?) to Use Your Own Name:

An additional important distinction between United States and European Union trademark law concerns the commercial use of personal names.

An important – but often overlooked – concept in U.S. trademark law is that an individual does not have an innate right to make commercial use of his or her own name. Rather, a person’s right to make commercial use of his or her own name is subordinate to prior trademark rights acquired by third parties. By way of illustration:

an individual whose surname is McDonald would not have a right to start a restaurant called “McDonalds”;

an individual whose first name is Oprah would not have a right to start commercializing a literary organization called “Oprah’s Book Club”; and

a real-life individual named Harry Potter would not have a right to start selling films, toys or books under the brand name “Harry Potter”.

While these illustrations may seem somewhat remote, trademark conflicts often arise where individuals either use or seek to register a trademark in their names – only to discovery that someone “beat them to it.” In perhaps the most extreme example, the name John Smith – long considered the most ubiquitous English language name – is the subject of several U.S. trademark registrations (Reg. No. 4936222 in Classes 18 and 25 and Reg. No. 5622333 in Class 21). An unsuspecting individual named “John Smith” might mistakenly believe that he can make unfettered commercial use of his name – but he would be wrong.

In contrast to the United States, European Union trademark law treats personal names very differently. Chapter 2, Section 2, Article 14 of E.U. Regulation 2017/1001 provides that:

“An EU trade mark shall not entitle the proprietor to prohibit a third party from using, in the course of trade… the name or address of the third party, where that third party is a natural person.”

The E.U. trademark regulations further clarifies that this provision:

“shall only apply where the use made by the third party is in accordance with honest practices in industrial or commercial matters.”

Thus, an individual – acting in good faith – has a limited commercial right to use his or her own name within the European Union. This means, for example, that an individual whose surname is McDonald should be able to open a restaurant called McDonald’s in the European Union without running afoul of trademark laws. Of course, the European Union’s regulations only provide for this exception for “natural person[s]” – greatly limiting the commercial scope of such third party use (presumably, limiting such use to “nominal” use).

United Kingdom Law:

Inasmuch as the United Kingdom is currently undergoing the Brexit process, it is increasingly important for rights holders to understand how the United Kingdom’s national trademark law applies to the registration of names and other indicia of persona. While the exact impact is unclear, once the United Kingdom leaves the European Union, United Kingdom trademark registrations will become more important to foreign celebrities.

In the United Kingdom, the Trade Marks Act 1994, Section 3(6) provides that:

“A trade mark shall not be registered if or to the extent that the application is made in bad faith.”

Based on our review, it appears that the United Kingdom Intellectual Property Office (U.K. IPO) interprets this “bad faith” requirement more strictly than the E.U. by affirmatively requiring a signed consent where a trademark application includes the name of a famous celebrity. That being said, it further appears that this is only done to the extent that there is some connection between the goods / services covered by the application and the reason why the celebrity is famous.

By way of illustration, the U.K. IPO would likely require a consent from Victoria Beckham for an application incorporating the words “Victoria Beckham” with respect to “musical performances,” “modeling” or “cosmetics”. However, it seems that the U.K. IPO would not require such a consent to register VICTORIA BECKHAM with respect to “cement” or “plumbing services.”

Thus, it appears that the United Kingdom takes a “middle of the road” approach – requiring more affirmative information from applicants than the European Union, but less than the United States.

Conclusion:

In Part II of this series, we explored how United States trademark law and practice places the burden on an applicant to prove the legitimacy of a trademark application covering what appears to be the name, portrait or signature of a living person.

In this article, we have explored some of the key differences between the United States system and those of the European Union and the United Kingdom.

Finally, in Part IV of this series, we will explore securing trademark protection for names in China – and some of the challenges in defending against squatter trademark applications in China.