29 November 2023

Effective and genuine use of a trademark: the Testarossa case

With decision of August 29^th 2023, relating to the TESTAROSSA sign which distinguishes high level sports cars, the EUIPO Board of Appeals ruled on the evaluation criteria of the effective and genuine use of a trademark.

In particular, a request for trademark revocation was submitted against the well-known sign, based on the lack of effective use for a continuative period of 5 years.

The owner of the trademark, in response to the action received, presented a series of evidence such as Internet articles and publications on industry magazines mostly about the history of the trademark, a number of invoices, pictures and technical data sheets, specifying that the interested market included experts and collectors exclusively.

The applicant for the revocation request contested such evidence arguing, in particular, that the owner admitted to no longer use the contested trademark and that the sporadic sale of Testarossa secondhand historic cars, by dealerships, surely did not constitute a trademark genuine use. In particular, the owner would not have used the trademark to create or preserve a market for goods bearing the sign at issue as the European regulation asks for.

The EUIPO Cancellation Division, nevertheless, although declaring the partial revocation of the trademark for components and accessories in class 12, declared proven the effective use of the contested sign for “car”, in the same class.

The decision at issue was then appealed by both parties and the European Judge, in its decision, addressed many interesting issues regarding the effective use of a trademark.

Firstly, by adhering to the complaints of the applicant of the revocation action, it stated that any use of the Testarossa sign regarding “cars” was proven. It was observed, in particular, that there was no evidence that could prove that the owner was directly involved in the sales of the cars under exam. As a matter of facts, the evidence provided, relating for the most part to the history of the trademark and to the famous owners of the sport cars, were far from demonstrating a genuine use of the sign providing rather indication on its reputation.

But not only that. The indication in abbreviated form of the trademark as TR or T/ROSSA, which appeared on the invoices of secondhand cars, altered its distinctive character. Moreover, the provided evidence had never shown that sales of secondhand motor vehicles were carried out with the owner consent, assuming that the mere tolerance with respect to such sales was not surely sufficient to prove an express consent. This in addition to the consideration that any license or distribution contract – between the owner and traders of TESTAROSSA cars – has never been provided in judgement.

In other words, there was not evidence that the owner of the trademark was part of sales contract or that they would receive commissions from such transactions, or that they were informed about them.

Ultimately, the fact that the owner of the trademark would not benefit from any of these sales was the proof that third traders were acting in their interest and not in the owner’s. Therefore, the decision states, TESTAROSSA car sales – today discontinued and interspersed mostly among enthusiasts – made by third subjects other than the owner and even without its consent, could not constitute an effective use suitable to avoid the revocation of the trademark.

The decision addressed also another interesting issue, that is whether the use of cars’ spare parts could prove the use of the main product, namely cars.

Well, what above mentioned could occur if the owner of a complex product also produced structural parts or integral parts of the same but this was not the case under exam. The commercial origin of the component parts at issue and the one of the products for which such parts were to be used was not the same. People involved in the sale of components and accessories were not acting, as seen, on behalf of the owner of the trademark, but on their own, as independent traders.

In brief, considering that the sale figures were so small as to not justify even the genuine use for accessories, the decision stated that the use of the trademark on accessories and spare parts was not suitable to constitute an effective use for discontinued TESTAROSSA cars.

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