Trademark Opposition: “iPhone” versus “SAIPHONE”

The Japan Patent Office (JPO) dismissed a trademark opposition claimed by the U.S. tech giant, Apple Inc. against trademark registration no. 6060316 for word mark “SAIPHONE” in class 9 and 18 by finding less likelihood of confusion with Apple “iPhone”.
[Opposition case no. 2018-900255]

“SAIPHONE”

Opposed mark, a word mark “SAIPHONE” in standard character, was filed by a Japanese business entity, STYLE Corporation, on September 28, 2017 by designating ‘mobile phones, smart phones, and its accessories, namely cases, covers and hands-free holders’ in class 9, and ‘purses and wallets, commutation-ticket holders, business card cases, bags and pouches, umbrellas, industrial packaging containers of leather’ in class 25.

STYLE Corporation promotes the “SAIPHONE” leather cases for iPhone (see below).

The JPO admitted registration on June 22, 2018 and published for registration on July 6, 2018.

APPLE’s Opposition

To oppose against registration within a statutory period of two months counting from the publication date, Apple Inc. with AIPHONE Co., Ltd., as a joint claimant, filed an opposition on September 7, 2018.

In the opposition brief, Apple Inc. asserted the opposed mark shall be cancelled in violation of Article 4(1)(xi) and (xv) of the Japan Trademark Law given a remarkable reputation of opponent mark “iPhone” in the business field of smart phones and similarity to a senior trademark registration no. 5147866 for the word mark “iPhone” in standard character over mobile phones in class 9 effective since 2008.

Interestingly, “iPhone” is indeed a registered trademark owned by AIPHONE Co., Ltd. in Japan. Apple Inc. is an exclusive licensee of the mark.

Apple Inc. argued opposed mark “SAIPHONE” gives rise to a confusingly similar pronunciation and appearance to “iPhone”, since opposed mark contains a famous mark “iPhone” entirely and a mere difference on prefix “SA” is insufficient for relevant consumers anything but to conceive “iPhone” from opposed mark.

Article 4(1)(xi) is a provision to refrain from registering a junior mark which is deemed identical with, or similar to, any senior registered mark.

Article 4(1)(xv) provides that a mark shall not be registered where it is likely to cause confusion with other business entity’s well-known goods or services, to the benefit of brand owner and consumers.

Board Decision

The Opposition Board admitted a remarkable degree of reputation and popularity of opponent trademark “Apple” in connection with smart phones based on the produced evidences showing a more than 40% share of the market in Japan.

In the meantime, the Board found “SAIPHONE” and “iPhone” are totally dissimilar since they are sufficiently distinguishable in visual, phonetic, and conceptual point of view.
A fact that opposed mark contains “iPhone” is not persuasive on the case since relevant consumers with an ordinary case would see opposed mark in its entirety.
If so, it is likely that the consumers confuse or misconceive a source of the opposed mark with Apple Inc. or any entity systematically or economically connected with the opponent.

Based on the foregoing, the Board decided the opposed mark shall not be cancelled on the grounds of Article 4(1)(xi) as well as (xv).


 Masaki MIKAMI, Attorney at IP Law – Founder of MARKS IP LAW FIRM

JPY 71 Million Damages Award Against Design Copycat of BAO BAO ISSEY MIYAKE

In a civil legal battle involving design copycat of luxurious “BAO BAO” bags designed by ISSEY MIYAKE, a Japanese fashion designer, the Tokyo District Court sided with ISSEY MIYAKE and found infringement under the Unfair Competition Prevention Act on June 18, 2019.
[Judicial case no. H29(Gyo-wa)31572]

BAO BAO ISSEY MIYAKE

Issey Miyake’s innovative and unique bag designs under the brand of “BAO BAO” since 2010 earned it accolades and wide recognition in the fashion world. Its most prominent design is crafted with a tessellating triangular structure that shifts as it’s moved to create new three-dimensional forms. Capturing a seamless fusion of geometric shapes and fluid silhouettes, the designs are often a kaleidoscope of color. Most of the pieces consist of rectangular equilateral triangle.

Disputed bags

Defendant, Largu Co., Ltd. began to promote following women’s shoulder bags, pouches, backpacks and tote bags under the brand of “Avancer” from 2016. Defendant copied tessellating triangular structure on disputed bags likewise. Most of the pieces are not rectangular equilateral triangle.

Defendant sold these goods for JPY 1,000 ~ 6,000. It was far cheaper than BAO BAO ISSEY MIYAKE – sometimes up to one-thirteenth.

Court decision

In the judgment, at the outset, the court assessed whether the geometric shapes of tessellating triangular structure shall play a role of source indicator protectable under the Unfair Competition Prevention Act. The judge found the shape of plaintiff’s goods has a distinctive and different feature from other women’s bags by taking account of produced evidences. Its unique and innovative design, inter alia, creating various three-dimensional forms when used, apparently gives unusual impression to consumers. If so, the prominent design consisting of triangular structure shall be protectable under the Unfair Competition Prevention Act.

Besides, the court found the triangular structure of plaintiff’s goods obtained a certain degree of popularity and reputation as a source indicator of BAO BAO ISSEY MYAKE by the time defendant launched disputed bags in 2016.

In assessing a likelihood of confusion, the court dismissed defendant’s counterargument on different shape of triangle by stating that disputed goods give rise to a same visual effect with BAO BAO ISSEY MIYAKE by means of creating various three-dimensional forms when used. Price difference is not a material factor to negate a likelihood of confusion as long as consumers conceive BAO BAO ISSEY MIYAKA at the sight of disputed bags.

After significant litigation, the trade dress suit ended with an injunction barring all future sales of the copied designs and a hefty damages award, JPY 71,068,000 under the Unfair Competition Prevention Act.

In the meantime, the court dismissed plaintiff’s allegation of copyright infringement on the ground that plaintiff’s goods are rather suitable for industrial design. In fact, plaintiff’s goods are produced in quantity at factory. If so, it shall be unprotectable under the Copyright Law.


Masaki MIKAMI, Attorney at IP Law – Founder of MARKS IP LAW FIRM

JPO Annual Report 2019

The Japan Patent Office released its 2019 Annual Report (in Japanese only) on July 12, 2019, which contain informative figures and statistics relating to IP applications in Japan and on all other activities of the JPO.

Trademark Applications in Japan

The number of trademark applications in Japan has increased recent years.
In 2018, 184,483 trademark applications were filed to the JPO. TM application via Madrid Protocol increased to 17,802 by 2.7% compared to the previous year. Direct application decreased to 166,681 by 4 %.

Trademark Application to JPO by Year

Timeline for Trademark Registration

Due to the recent increase, timeline for trademark prosecution, i.e., the average time between filing and first office action, was getting longer for the last four years in a row. Trademark Average First Action Pendency was 6.3 months in 2017. In the meantime, the pendency in 2018 exceeded 7.9 months on average. Accordingly, the average total pendency period for trademark registration was 9.3 months in 2018.

Timeline for trademark registration

Application to JPO by Foreign Company/ Non-resident

39,209 trademark applications, which account for 21.3% of the total, were filed by foreign company or non-resident in 2018. The number was increased by 8.4% since last year.

TM Application to JPO by Foreign applicants

The statistic shows Europe was leading the ranking with about 10,000 trademark applications in 2017. In 2018, China took the leading place eventually.


Masaki MIKAMI, Attorney at IP Law – Founder of MARKS IP LAW FIRM

The Japan IP High Court Finds “EQ” Entitled to Trademark Registration Belonging to Mercedes Benz

On July 3, 2019, the Japan IP High Court reversed a decision of the Japan Patent Office (JPO) finding that the company Daimler AG was entitled to registration of “EQ” for Motor vehicles in class 12, even though the term “EQ” by itself is descriptive for the goods.
[Case no. Heisei31(Gyo-ke)10004, Daimler AG vs the JPO Commissioner]

The EQ Application

The JPO has refused registration to an application for EQ in standard characters (word only, see below) on the basis that the mark was descriptive for the goods “Motor vehicles” in class 12 based on Article 3(1)(v) of the Trademark Law.

The article prohibits an applied mark from registering if it consists solely of a very simple and common mark. Trademark Examination Guidelines (TEG) stipulates that a mark consisting of one or two alphabetical letters is not eligible for registration under the article. Click here.

A mark consisting of two alphabetical letters is not capable of identifying the source of the goods due to a lack of distinctiveness because a combination of two alphabetical letters is limited on quantity and currently used to represent a model name of vehicle, e.g. BMW XS, TOYOTA Carina ED, Ferrari FX, Nissan GT-R.

Descriptive terms falling under the article are only capable for registration based on Article 3(2) if they have “acquired distinctiveness”, which means the term has taken on a meaning in the public view so that people see the term as a trademark identifying the goods rather than simply describing the goods.

In this regard, Daimler AG argued the EQ mark, a coined term originating from “Electric Intelligence” to appeal design, extraordinary driving pleasure, high levels of everyday suitability and maximum safety of electric car by Mercedes-Benz, has acquired distinctiveness since launching the brand at the Paris Motor Show in September 2016.

JPO Decision

However, the JPO dismissed the argument on the grounds that:

  1. Daimler has neither used the EQ mark by itself as a name of electric car nor produced evidences of its plan to sell electric car named “EQ”.
  2. Daimler uses the EQ mark in a stylized design in press releases. If so, it is questionable whether relevant consumers conceive the EQ mark in standard characters as a source indicator of Mercedes-Benz.
  3. According to the produced evidences, Daimler uses the EQ mark in combination with other literal elements, e.g. “Generation EQ Concept”, “Concept EQA”, “EQC”, “smart vision EQ for two”, “EQ POWER”, “EQ POWER+”.
  4. There are no actual domestic sales of the electric car using the applied mark during the past two years from the date Daimler launched the brand in fact.
  5. A combination of two alphabetical letters, “E” and “Q”, has been generally used as a mode name in association with vehicles, e.g. TOYOTA electric car “eQ”, HYUNDAI luxury sedan “EQ900”, Zhengzhou Nissan truck “EQ1060”, Laufenn tyre “S FIT EQ”, ALPINE car navigation “EX11Z-EQ”, SPECIALLIZED bicycle “ALIBI SPORT EQ”. If so, the EQ term shall not be eligible for monopoly by a specific entity any longer.

The Appeal Board of JPO also upheld the refusal.
[Appeal case no. 2018-650016]

To contest the administrative decision, Daimler AG filed an appeal to the IP High Court on January 15, 2019.

IP High Court Ruling

The court first found the EQ mark in standard characters is not eligible for registration under Article 3(1)(v) of the Trademark Law.

In the meantime, the court found Daimler has newly released, promoted, and used the EQ mark with a combination of “POWER” as a new brand concept of electric car by Mercedes-Benz. Given a space for single letter between “EQ” and “POWER”, relevant consumers at the sight of promotional materials, advertisements and car magazines pertinent to Mercedes-Benz’s new electric car brand would perceive “EQ” as a specific source indicator. Taking account of enormous number of circulation of magazines (approx. 230,000) and advertisements for users (170,000 per year), the court held the EQ mark has been well known for a source indicator of Daimler electric car among relevant consumers and traders even if the duration of actual use and sales amount are not sufficient by themselves.

Notably, the court also negated fact-finding by JPO regarding ordinary use of the term EQ in association with vehicles by stating that since competitors use the term in a tight combination with other literal elements, they can be simply perceived as a mode name. If so, such use shall not be construed to negate acquired distinctiveness of the EQ mark by Daimler.

Based on the foregoing, the court ruled the EQ mark is entitled to trademark registration based on Article 3(2) of the Trademark Law and reversed a decision by the JPO on that account.


Masaki MIKAMI, Attorney at IP Law – Founder of MARKS IP LAW FIRM