General Court, 15 March 2018, case T-1/17, La Mafia Franchises v. EUIPO
Article 7(1)(f) of Regulation No. 207/2009 shall be implemented by taking into account both of the circumstances common to all Member States of the European Union and of the particular circumstances of individual Member States which are likely to influence the perception of the relevant public within those States. Based on this, the trademark application for “La Mafia se sienta a la mesa”has to be rejected as contrary to public policy and morality. In fact, the contested mark, considered as a whole, refers to a criminal organization and, therefore, trivializes the serious harm done by the organization to the fundamental values of the European Union. The contested mark is therefore likely to shock or offend not only the victims of that criminal organization and families, but also any person who, on EU territory, encounters the mark and has average sensitivity and tolerance threshold
Summary: 1. Introduction. – 2. The absolute ground under Article 7(1)(f). General remarks. – 2.1 Public policy and morality: a not-too-objective definition. – 2.2 One step after the other: methodology in a nutshell. – 3. The decision of the General Court in La Mafia se sienta a la mesa. – 3.1 The First Board of Appeal Decision (“the Contested decision”). – 3.2 The arguments of the applicant. – 3.3 The findings of the Court. – 4. Some considerations. – 4.1 Historical memory and its inconsistency. – 4.2 The balance with freedom of expression in the EU. – 4.3 …and beyond. – 5. Conclusion and final remarks
- Introduction
Innovation and economic growth provide companies and individuals with new, powerful tools to establish and communicate their business. In the same time, these enhanced possibilities result in a highly competitive scenario: small and medium businesses will now have to struggle for the purpose of establishing themselves and their services on the market. In this sense, indeed, trademarks and trademark law, in general, do represent valuable instruments to achieve this goal. And in fact, as justly noticed by Frank Schechter[1], the real value of modern trademarks stays in their «selling power», which is deeply connected to their uniqueness and singularity. In other words, the more «unique» and «persuasive» the trademark is, the more the chances are for traders to attract and retain potential customers.
On the other side, as pointed out by the EUIPO in its Guidelines for examination of European Union Trademarks (“The Guidelines”)[2]the right of traders to freely employ words and images in the sign they wish to register as new trademark has to be balanced against the right of the public not to encounter disturbing, abusive, insulting and even threatening trademarks[3].
The need for such a balance is perfectly summarized by Article 7(1)(f) EUTMR[4]which, mirroring Article 6-quinquies (B)(3) of the Paris Convention[5]and other provisions with similar rationales in different areas of IP law[6], excludes from registration trademarks that are contrary to «public policy or to accepted principles of morality». Namely, according to the Boards of Appeal decisions, this is the case if the «[r]ecipient of the goods, when reading the sign applied for on or in connection with the offer and marketing of these goods, is insulted, discriminated against or held up to ridicule or if his sexual self-determination is violated»[7]. This provision also constitutes the starting point of our analysis, which will look at the recent ruling of the General Court (GC) in La Mafia Franchises v EUIPO(T-1/17), with the aim of defining as much as possible the scopeof this ground for invalidity, investigating its connection with the fundamental right of freedom of expression.
2.The absolute ground under Article 7(1)(f). General remarks
In order to better understand the impact of the GC Decision in La Mafia se sienta a la Mesa,one has to consider first what is meant by “public policy and morality” and how such a notion has been adopted and interpreted across the EU over the time.
In the present paragraph, we will summarize those concepts we regard as key for this purpose.
2.1 Public policy and morality: a not-too-objective definition
First things first: before any analysis can be started, and as always when dealing with trademark absolute grounds, the underlying policy must be carefully investigated. In this case, as anticipated, the ground under Article 7(1)(f) assumes the difficult role of promoting commercial solutions which are, in the same time, persuasive but not outrageous. In other words, if on one side the EUIPO shall not assist traders wishing to further their business by using trademarks that offend certain basic values of civilized society, on the other, it will not base its analysis on the perception of that «small minority of exceptionally puritanical citizens».
Coming to the merits, a preliminary distinction has to be drawn between the notion of “public policy” and the one of “accepted principles of morality”. In general terms, it could be argued that, while the first objection derives from an assessment based on objective criteria, the second concerns subjective values. Still, as we will see, such a distinction is reduced in practice. Namely, as pointed out in the EUIPO Guidelines, public policy refers to «the body of Union law applicable to a certain area, as well as to the legal order and the state of law as defined by the Treaties and secondary EU legislation». The notion would apply to those trademarks which are likely to induce public disorder or increased likelihood of criminal or offensive behavior. The Guidelines also include a list of trademarks which are potentially attracted by this ground. However, as we will see, the non-exhaustive nature of the said list is not in line with the allegedly objective nature of the assessment.
Moving to the notion of «accepted principles of morality», as for the Guidelines, the latter is aimed at excluding from registration those signs perceived from a significant part of the relevant public as going directly against basic norms of society. This is because in every community there are standards of conduct widely shared that must be respected in order not to undermine religious, social, family values. Prohibition includes, for example, trademarks of blasphemous, racist, discriminatory or insulting words or phrases. However, this is not just a matter of bad taste. And in fact, the Guidelines specify that the ground must be applied «as objectively as possible by the examiner». For this purpose, the assessment shall be conducted taking into account, as factual evidence, both national law and practice. Also, the standard to be applied in the decision is that of a reasonable consumer with average sensitivity and tolerance thresholds.
It follows that the subtle line between what is “objective” policy and what is “subjective” morality tends to shade in practice. With the result that, in most of the cases, the two concepts of public policy and accepted principles of morality are likely to overlap. However, the difficulty in establishing clear boarders in this area does not necessary represent an issue, given that, according to the Guidelines, «raising an objection when a trademark is contrary to accepted principles of morality does not exclude that the sign can also be contrary to public policy».
2.2 One step after the other: methodology in a nutshell
Once defined the overlapping concepts of public policy and morality – or demonstrated the impossibility for such a definition to be elaborated – we’ll now turn to the basic steps to be followed in the analysis of the ground. This will be helpful when examining the GC decision.
In other words, the question to be answered is on which basis the examiner, the board and/or the General Court will decide from time to time what constitutes a valid, admissible, trademark and what instead has to be rejected.
Following the Guidelines, in general terms, what matters for the assessment is that its main focus shall be the trademark itself. This means that the analysis will have to be conducted taking into account the intrinsic qualities[8]of the trademark in an objective[9]manner. As a result, neither the conduct of the applicant nor its intention are deemed to be relevant for the decision.
As a next step, “the application’s expressive content” will have to be considered. This operation will aim at establishing whether the trademark application can be considered neutral or not. In this latter case further examination will be required. Interestingly enough, not only a strongly negative connotation of the mark can result in its refusal, but also a strongly positive connotation thereof can bring to a similar outcome.[10]
Finally, as for the relevant public, the assessment shall take into account the point of view of the «reasonable consumer with average sensitivity and tolerance threshold». [11]Naturally, different thresholds will apply in specific contexts and, in particular, when dealing with children.
All of the above mentioned steps were applied by the General Court in its ruling.
- The decision of the General Court in La Mafia se sienta a la mesa
On 30 November 2006, Le Honourable Hernandad, SL, to which the Applicant, La Mafia Franchises, SL is the successor, filed an application for registration of an EU trademark with the European Union Intellectual Property Office (“EUIPO”). This rather common scenario constitutes the starting point of a quite uncommon saga. At the basis, the circumstance the figurative mark applied for reproduced the words “La Mafia se sienta a la mesa”(Spanish form for “La Mafia sits at the table”) in combination with a nicely depicted red rose[12]. The relevant goods and services selected were clothing (Class 25), business management and organization consultancy services (Class 35) and services for providing food and drinks (Class 43). The trademark application was published in Community Trade Marks Bulletin No.24/2007 of 11 June 2007 and registered on 20 December 2007 under No. 5510921.
Time flies but absolute grounds don’t.
On 23 July 2015, the Italian Republic filed an application with EUIPO for a declaration of invalidity of the contested mark, based on Article 7(1)(f) of Regulation No. 207/2009[13]. Namely, the Italian Republic claimed that the registered trademark was contrary to public policy and accepted principles of morality, since the word element “Mafia” referred to a criminal organization and its use in the mark resulted in deeply negative connotations. Plus, also in consideration of the services applied for, it had the effect of manipulating the positive meaning of Italian cuisine.
Unsurprisingly enough the Cancellation Division, by decision of 3 March 2016, upheld the application of the Italian applicant and declared the mark invalid.
The said decision was appealed on 29 April 2016 before the First Board of Appeal of EUIPO.
3.1 The First Board of Appeal Decision (“the Contested decision”)
By its decision, the First Board of Appeal confirmed the findings of the Cancellation Division. The ruling is relevant to us in so far it aims at clarifying Article 7(1)(f) EUTMR[14]application, also anticipating those key points which will be further elaborated by the General Court in its ruling. More in detail, the analysis made by the Board of Appeal contributed to (i) the definition of the notion of relevant public, (ii) the identification of the dominant and distinctive elements of a mark, and (iii) the clarification of the role played by the precedent in the EUIPO legal system.
Each of the mentioned points was discussed and extended upon within the General Court decision.
3.2 The arguments of the applicant
In substance, in its plea before the General Court the applicant relies on four main arguments.
Of these arguments, only the first one is deeply connected to the public policy and morality ground, the others extending way beyond the scope of Article 7(1)(f) EUTMR.
By its first plea (“public policy-related plea”), the applicant claims that the invalidity decision should be reverted and the trademark registration maintained for the fact neither the organization known as Mafia nor its members are included in the list of terrorist persons and groups mentioned in the “Annex to Council Common Position 2001/931/CFSP of 27 December 2001 on the application of specific measures to combat terrorism” (OJ 2001 L 344, p. 93). And in fact, said Annex is referred to, among the others, by the EUIPO in its Guidelines for the purpose of clarifying the scope of the prohibition contained in Article 7(1)(f). Thus, by its reasoning, the applicant submits the mark shall not be declared invalid, basing on the fact that Mafia would not represent a criminal organization listed by the Guidelines and, therefore, recognized as such.
Secondly, on a more general level, the applicant maintains the trademark should be analyzed as a whole (“trademark-comparison plea”). In other words: it’s not all about Mafia. There are other elements as well in the mark and these would result in the trademark being perceived as a type of parody or reference to the Godfather series.
Thirdly, as for the nature of the services applied for, which do not constitute “communicative services”, it is to rule out, in the applicant view, that the purpose of the trademark is to be abusive or insulting. In particular, according to the applicant, the said trademark, referred to a restaurant chain, would instead aim at evoking values of family and fellowship (“trademark-services plea”).
Finally, the applicant maintains that, in any case, the mark should be regarded as valid for the simple reason there are already many EU and Italian marks containing the term Mafia. More in detail, the applicant makes a direct reference to the EUIPO decisions in Mafia II[15]and Contra-Bando[16](“value of precedent plea”).
3.3 The findings of the Court
In its decision, the General Court examines and dismisses each of the applicant arguments, also taking the opportunity to clarify some additional notions, all connected to the enforcement of Article 7(1)(f) EUTMR.
As anticipated, the starting point of the analysis stays in the identification of Article 7(1)(f) underlying policy. This consists in excluding from registration those signs which, when used in the EU community, would be perceived as contrary to public policy or accepted principles of morality. It follows, in the Court reasoning, that the relevant public for such an assessment cannot be limited to the pubic the goods and services at stake are directly addressed to, but it extends way beyond, including also those persons who will encounter the sign accidentally in their life[17]. In this context, the assessment shall be conducted (i) by reference to the perception of a reasonable person with average sensitivity and tolerance threshold and (ii) by taking into account both the circumstances common to all Member States (MSs) of the European Union and particular circumstances of individual States. This stems from the consideration that, indeed, the notion of public policy and morality cannot be the same in all the MSs, as it is deeply connected to linguistic, historic, social and cultural reasons.
In the light of the above premise, the Court dismisses the first of the pleas considering that the fact the Mafia is not listed in the Common Position 2001/931 as a terrorist organization[18]does not exclude it is a criminal organization, breaching with its activities the very values of respect for human dignity and freedom which constitute the essence of the EU Community[19]. And in fact, as for the General Court, when the list was created, it was not meant to be exhaustive. Plus, in particular in Italy[20], the term Mafia would assume deeply negative connotations, evoking all the harm done over the time by the organization to the security of that MS.
In the same way, the GC considers that the circumstances the word Mafia is reproduced in combination with other words and the trademark features a red rose as well do not mean this is not the dominant and distinctive element of the mark. This finding is based by the Court on the size and the position occupied by the term Mafia in the trademark.
As for the services applied for, again, the fact the trademark was not registered for communicative services does not mean it was not meant to be shocking or insulting. Also, in any case, this would not be relevant for the assessment[21]. And in fact, in the opinion of the Court, this has to be conducted in an objective manner, based on the intrinsic qualities of the mark, and ignoring the applicant underlying purpose/intention. Indeed, as it’s all about the intrinsic qualities of the mark, its potential connection to the Godfather and the fact there are a lot of movies and books about Mafia will not impact on the final decision. By contrast, the fact the word Mafia is combined with a rose, which might be perceived as a symbol of love and harmony, is relevant to the assessment, as it contributes to convey a globally positive – therefore to-be-banned- image of the activities of the criminal organization.
Finally, in regard to the last of the pleas, the GC considered that the evoked EUIPO decisions in Mafia IIand Contra-Bandoare not likely to impact on the level of protection accorded. And in fact, as for the Court, decisions are adopted in the exercise of circumscribed powers and are not a matter of discretion[22]. Similarly, the fact a series of trademark registrations including the word Mafia exist in Italy is not relevant to the assessment, given that «neither EUIPO nor the EU courts are bound by national decisions on registration such as those to which the applicant refer».[23]
For all these reason the appeal was dismissed and the trademark declared invalid[24].
4.Some considerations
The interplay between morality-rooted considerations and the need for a trademark to be persuasive constitutes a rather controversial area within the EU community. In fact, it is very difficult to draw the line between what constitutes outrageous but admissible trademark and what is instead offensive, therefore invalid, application. In this sense, the provision under Article 7(1)(f) EUTMR has been subject to a number of critics within the EU community. In the following paragraph we will briefly deal with what we regard as the two main points of concern.
4.1 Historical memory and its inconsistency
The public policy and morality ground, for its very nature, is deeply dependent on the context in which it is considered. And in fact both the notion of “public policy” and the one of “accepted principles of morality” involve a somehow subjective assessment. Such an assessment, as we have seen, shall be conducted taking into account the country where the trademark is to be adopted as well as the specific context. For example the same – outrageous – registration might be rejected with regard to ordinary items – also considering the level of children exposure – and accorded in relation to products sold in sex shops[25]. At the basis, the practical consideration sex shops clients are unlikely to be shocked by that trademark, while children or ordinary people normally are. In the same way, the application of the ground could vary from country to country. For example, while a number of drug-related registrations were accorded across Europe[26], in Italy registration for the slogan “La droga dà, la droga toglie” was recently denied, basing on the ambiguous character of the message contained. [27]Also, apart from adopting stricter moral standards, countries might promote different values. For instance, in the US decision in Old Glory[28], a «pictorial representation of a condom decorated with stars and stripes in a manner to suggest the American flag» was admitted by the Court, probably basing on its patriotic meaning (It is American’s patriotic duty to fight AIDS by practicing safe sex)[29].
In the light of the above, it has been argued that one of the main issue of the ban would be the difficulty to reconcile the decisions it gives rise to. Indeed, as we have pointed out, in this area more than in others, the final outcome is deeply influenced by the sensibility of the judges. Also, the EUIPO Boards have stressed more than once the necessity of taking into account in the assessment the “historical memory” of Member States – including their case law and national offices Guidelines. However, as it was made clear in La Mafia se sienta a la mesa, this does not mean EUIPO Boards are bound themselves by the decisions of national offices[30]. By contrast, they will be autonomous in their decision making. For this very reason, in our view, inconsistency of national decisions, although representing a matter of fact, will not impact in a negative way on the practice of the Office.
4.2 The balance with freedom of expression in the EU
The second main point of debate is represented by the correct balance between public policy and morality considerations on the one side (pushing for the application of the ground), and freedom-related arguments, promoting the rights of traders, on the other.
In other words, one has to establish to what extent the provision under Article 7(1)(f) EUTMR can legitimately undermine the right of freedom of expression, as provided under Article 11 of the Charter[31]and Article 10 of the European Convention of Human Rights (“ECHR”).
As we will see, such a balance has been recently considered both by the US Supreme Court and the ECHR. In the EU context, the position embraced by the EUIPO and supported by the main scholars[32], is that the act of refusing a trademark registration cannot be regarded as in breach of freedom of expression. [33]This is because such a denial would not prevent the trademark from being used[34]. By contrast, as it was justly noticed, freedom of expression could be hindered by the grant of trademark registration, which by its own nature does represent a form of monopoly. [35]
In any case, the Grand Board recognized that different standards will apply when considering artistic or cultural communications. This because, freedom of artistic expression is generally regarded by the Court as higher priority than freedom of commercial expression. Basing on this, the Board considered the slogan “How to make money selling drugs” acceptable, as it was the name of a thought-provoking documentary.
4.3 …and beyond
The difficulty of defining common interpretative trends when dealing with such a context-dependent ground is even stronger when considering the approach undertaken by jurisdictions other than the EU. Two examples will help in clarifying the terms of the question.
In the case of Sekmadienis v Lithuania[36]the European Court of Human Rights held that the fine issued by the State Consumer Rights Protection Authority (“SCRPA”) against a company because of its adverts referring to “Jesus” and “Mary” was a violation of Article 10 ECHR. The decision is relevant for two main reasons. On one side, in general terms, the ruling pertains to a different legal system, where, a role is to be played by the freedom of expression argument. And in fact, according to Article 10 ECHR, limitations to the registration of a trademark are not allowed insofar as they interfere with freedom of expression. On the other side, coming to the actual assessment, the decision moves from the assumption which the fact a minority – or even a majority- is offended by a publication does not, of itself, justify a restriction of freedom of expression. It will be necessary for this purpose the finding of «some kind of gratuitous offence or profanity, or some incitement of hatred on the grounds of religious belief». Such an assessment shall take into account both the intentions of the publisher and the objective effects of the publication. Interestingly, the EUIPO Guidelines express the same principle according to which «it is not sufficient that the trademark is only likely to offend a small minority of exceptionally puritanical citizens (…) the trademark must be assessed by reference to the standards and values of ordinary citizens (…)».[37]However, as we have seen, it is very different the role attributed to the intention of the author: and in fact in the EU there is no need to establish that the applicant wants to shock or insult the public. The fact the EUTM applied for might be seen, as such, to shock or offend is sufficient[38].
A similar, freedom-oriented, outcome was reached in the US, where by its decision in Matal v Tam[39]the US Supreme Court affirmed that the ban imposed on disparaging trademarks under the Lanham Act constituted a violation of the First Amendment, protecting the free speech. In this case the issue concerned “The Slants”, a band of Asian Americans who attempted to register as a trademark their band name, in order to reclaim their racial slur and with no intention of denigrating Asian Americans. In its decision, and in line with the EUIPO Guidelines, the Supreme Court considered that disparaging “intentions” do not matter when accepting or refusing a trademark application. Also, disparaging speech was not generally prohibited by the government. For these reasons the Court held registration was to be accorded. Such a decision is relevant insofar as it establishes there is no “hate speech” exception to First Amendment and, in general terms, free speech has to always be protected. However, it also constitutes a reminder that in order for a sign to be eligible for registration it will need to function as a trademark[40].
- Conclusion and final remarks
In this brief excursus, by moving from the recent decision of the General Court in La Mafia se sienta a la mesawe aimed at discussing the current legal framework with reference to the public policy and morality absolute ground. Our analysis highlighted that, although the decision significantly contributed to the definition of some interpretative questions (i.e. the notion of relevant public, the identification of the dominant and distinctive character of the mark, the role played by the precedent), the intertwined notions of “public policy and morality” still remain difficult to define. In particular, two main issues arise. On one side, due to its subjective and context related nature, it is very difficult to clearly identify Article 7(1)(f) EUTMR scope of implementation. As discussed above, this is demonstrated by the presence of numerous decisions within the EU community, which are inconsistent and often difficult to reconcile. On the other side, the relationship existing between freedom of expression and the public policy and morality ground is yet to be clarified. In this sense, it might be argued that, while the US has recently embraced a freedom of speech rooted approach, the trend in the EU allows for restrictions to be imposed on registration given that this does not prevent the trademark from being used.
[1]F. Schechter The rational basis of trademark protection,Cambridge, 1927
[2]Guidelines for Examination of European Union Trademarks, Part B, Examination, Section 4, Chapter 7.
[3]See R 495/2005-G, Screw You (2006).
[4]Regulation (EU) 2017/1001 of the European Parliament and of the Council of 14 June 2017 on the European Union trade mark (‘EUTMR’).
[5]The Article provides for the refusal of trademark applications and for invalidation of registrations where trademarks are «contrary to morality or public order».
[6]See CJEU, T-417/10, Que buenu ye! Hijoputa(2012), for a comprehensive list.
[7]See R 1627/2015-4,Pica(n 1) (2015), § 16; see also, R 1052/2016-4,Lez(n 1) (2016), § 13. Said decisions make clear the assessment goes beyond basic criminal and administrative law principles, taking into account the human rights vocation of the EU.
[8]Similarly, commercialization does not matter because the breaching of the sign on moral and social sentiments is an objective assessment.
[9]See R 1805/2007-1,Paki(2009), § 27.
[10]See in this regard the decision R 2613/2011-2, Ataturk (2012) § 31, according to which the banal use of some signs with a highly positive connotation can also be offensive.
[11]See Que Bueno! Hijoputa, § 21.
[12]See EU trademark registration No. 005510921. Another identical trademark had been filed by the same applicant for Classes 30, 33, 43 on the 4th of November 2003. However, said application was withdrawn in June 2006.
[13]Now Regulation (EU) 2017/1001 of the European Parliament and of the Council of 14 June 2017 on the European Union trade mark (“EUTMR”).
[14]In conjunction with Article 52 (1) (a) of the same Regulation.
[15]See R 1224/2011-4, Mafia II (2012).
[16]See R 2822/2014-5, Contra-Bando (2015).
[17]See T-52/13Efag Trade Mark company v OHIM (Ficken) (2013), § 19 and T-266/13, Curve(2013), § 19.
[18]See R 563/2016-2 Eta,(2013).
[19]Article 2 TEU and Article 2, 3 and 6 of the Charter of Fundamental Rights of the European Union
[20]See also T-140/02, Intertops(2005), § 34.
[21]The finding of the General Court is in line with the EUIPO Guidelines where in fact it is said that «the question whether the goods or services for which protection is sought can or cannot be legally offered in a particular Member State’s market is irrelevant for the question as to whether the sign itself falls foul of Article 7(1)(f) EUTMR» (Intertops,§ 33).
[22]See C- 412/05, Alcon v OHIM(2017), § 65; T-364/04, Arthur et Felicie (2005) § 71.
[23]See T-154/13,Ficken Liquors(2013), § 46.
[24]The decision was subsequently referred to by the Office when refusing the application made for the trademark “Mafia Rave”. The examiner held that «the contested mark, considered as a whole, conveys a globally positive image of that organization and therefore trivializes the serious harm done by the organization to the fundamental values of the European Union».
[25]See Screw You,§§ 26-29.
[26]See, among the others, registration No. 0916687 for “The King of Cannabis” and EU registration No. 003381381 for “Cannabis culture”.
[27]Decision of the Italian Board of Appeal of 24 November 2017, No. 57/2017, La Droga Da’ La Droga Toglie.
[28]TTAB Judgement in Old Glory Condom Corp., 26 U.S.P.Q. 2d 1216(1993).
[29]E. Bonadio, Brands, Morality and Public Policy: Some Reflections on the Ban on Registration of Controversial Trademarks, inMarquette Intellectual Property Law Review, 19(1), 2015, 43 ss.
[30]See Screw You, § 11.
[31]Charter of Fundamental Rights of the European Union.
[32]See P. Von Kapff Fundamental Rights in the Practice of the European Trade Mark and Designs Office (OHIM),in: C. Geiger (ed.), Research Handbook on Human Rights and Intellectual Property, Cheltenham, 2015.
[33]C. Geiger-L. M. Pontes, Trade mark registration, public policy, morality and fundamental rights, Centre for International Intellectual Property Studies Research Paper No. 2017-01.
[34]See Que Buenu Ye! Hijoputa (Fig.).
[35]Ibid. Let’s think for example at the monopolization of the symbol of the Christian Cross which would undermine the right to use the symbol by other religious group.
[36]ECHR, app. 69317/14 (2018).
[37]See Screw You, § 21.
[38]See Paki,§ 27.
[39]Matal v. Tam, 582 U.S. ___ (2017).
[40]R. Ledesma, Peace and Hate at the USPTO, in EverythingTrademarks.com, 28 January 2018.
