A battle of the giants: fashion powerhouse Chanel and tech gigant Huawei fought it out in the realm of IP law, which allowed for a clarification of the extent of protection of visual marks in relation to their orientation. Lawyers, take note!

The facts

In autumn 2017, Huawei Technologies filed the following EU figurative trademark application with EUIPO for (amongst other things) computer hardware. Just before christmas of that year, the fashion house Chanel filed an opposition on the grounds that the mark had similarities with two earlier French trademark registrations registered for perfumery goods, cosmetics, costume jewelry, leather goods and clothing.

The latter figurative mark is also a well-known mark within the meaning of Art. 8 (5) EUTMR. Chanel’s opposition was mainly based on the fact that the Chanel marks were also used in rotated orientation. The EUIPO rejected Chanel’s appeal on the grounds that there was no similarity between the mark applied for by Huawei and the two Chanel marks. Chanel filed an appeal against this decision before the EU General Court (EGC) – and lost.

No rotations in my trademark law, please

The EGC mainly examined the degree of similarity of the conflicting signs. According to consistent case law, for the assessment of their identity or similarity, the conflicting marks must be compared in the form in which they are registered and applied for, irrespective of whether they may be used on the market in a rotated orientation.

The mark applied for by Huawei is a figurative sign consisting of a circle containing two curved lines that look like two black letters ‘U’ arranged vertically and mirrored, the lines crossing and overlapping so as to form a horizontal ellipse in the center. By contrast, the two Chanel marks consist of two curved lines, which look like two black letters ‘C’ arranged horizontally and mirrored, the lines crossing and overlapping so as to form a vertical ellipse; the second of those marks has the particular feature that the curved lines are inside a circle.

Although the marks at issue have certain similarities, they also have significant visual differences. In particular, in the case of Chanel’s marks, the curves of the curved lines are more pronounced, the stroke width is broader and the lines are oriented horizontally, whereas in the case of Huawei’s mark, the orientation is vertical.

In the end, because of this reasoning, the court declared the marks to be dissimilar and did not reverse the earlier decisions made by the EUIPO.

Why does this come at a surprise?

In this case, EGC diverged from its design law decision in Chanel/EUIPO – Jing Zhou and Golden Rose 999 from 2017, in which it found the similarity of the Chanel monogram and of the displayed Community design and confirmed the cancellation of the latter for lack of novelty.

Prima facie, the two drawings look quite different: in the community design, it is inverted once from two” 3 “, while the Chanel monogram is inverted from” two “C”. It can also be said that the controversial pattern represents a horizontal loop with pointed ends and a somewhat thicker line, while the Chanel monogram represents a vertical oval, central vacuum with pointed ends.

Nevertheless, the court decided that the overall impression does not differ. It argued that the outer parts that determine the contour and the overall impression of the opposing designs are very similar and almost identical. The central parts consist in overall of similar oval shapes that dissolve into the overall appearance of the drawings. And even the informed user can only recognize differences in direct comparison, which is not always immediately possible. The court pointed out the importance of the overall impression, precisely because the ornaments in question are registered in Class 32 of the Locarno Classification (Decoration), which makes it virtually impossible to determine in advance the use of the design.

So, what should I take away?

In the context of the protection of the similarity and the reputation of trademarks and the exploitation of their reputation and distinctiveness, the trademark similarity, must be examined autonomously on the basis of the display in the trademark registration, without the turned use of a well-known trademark being taken into account. Thus, design and trademark law diverge in this regard.

Therefore, as part of the trademark strategy for monogram marks, the registration of rotated alignments should also be considered, especially if they are also used by the trademark owner.