The matter at hand
The Spanish company Fiesta Hotels registered an EU figurative mark containing the word elements ‘Palladium Palace Ibiza Resort & Spa’, for services in classes 41 and 43 (hotels). Residencial Palladium, another Spanish company, initiated invalidity proceedings against this trade mark, on the basis of the earlier unregistered sign ‘Grand Hotel Palladium’, that it had allegedly used in Spain as a trade name for hotel services.
The Cancellation Division of the EUIPO upheld the invalidity action with regard to the services of class 43, stating that Residencial Palladium had successfully demonstrated that it used its earlier right in the course of trade in Spain to designate a hotel, and that this use was of more than local significance.
Before the General Court, Fiesta Hotels argued that the Board of Appeal had incorrectly concluded that the earlier sign was of more than ‘local significance’, since the actual (hotel) services were only offered in one town on the island of Ibiza. Fiesta Hotels furthermore argued that under the applicable Spanish national legislation, only well known trade names could oppose the use of younger trade marks, and that this condition had not been fulfilled. The General Court dismissed the appeal of Fiesta Hotels, after which the case was brought before the ECJ.
The judgment of the ECJ
The ECJ reiterates that a proprietor of a sign, other than a trade mark, may invoke the invalidity of an EUTM if: i) that sign has been used in the course of trade; ii) such use is of more than mere local significance; iii) the right to exercise such a sign has been acquired (pursuant to the national legislation of the Member State where that sign is used) prior to the date of application of the contested EUTM, and iv) such national legislation grants the right to oppose the use of a younger trade mark.
As to the first two criteria, the ECJ clarifies that these must not only be considered with respect to the place where the relevant services are actually offered, but also on the basis of the geographic spread of the public to whom the services are offered. The General Court therefore correctly took account of the fact that the public to whom the hotel services of Residencial Palladium were offered and who visited the hotel, came from all parts of Spain (and even several other Member States).
Regarding the latter two criteria, the ECJ holds that the General Court correctly relied on two (final) judgments of Spanish courts (with near similar facts and rendered between the same parties), by which Residencial Palladium’s right to oppose the registration of trade marks on the basis of its trade name had been acknowledged. In these circumstances, the General Court did not have to assess whether the trade name truly met the requirement of being well known under Spanish law.