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

IP High Court denied registering 3D Shape of Nursing Care Bed

The Japan IP High Court ruled on December 29, 2018 and did not side with Paramount Bed Co., Ltd., a Japanese manufacturer and distributor of medical and nursing care product, who filed an appeal against refusal decision by JPO to TM Application no. 2015-29155 for 3D mark representing the shape of home care bed.
[Heisei 30 (Gyo-ke) 10060, Court ruling date: November 28, 2018]

 

3D shape of home care bed

Disputed mark, representing three-dimensional shape of nursing care bed, was filed on March 31, 2015 by designating nursing care bed and mattress in class 20. The Japan Patent Office (JPO) refused the mark due to a lack of distinctiveness.

  

Paramount Bed argued acquired distinctiveness as a source indicator of Paramount nursing care bed through substantial use of the mark and its unique shape.
According to the argument, Paramount has distributed more than 145,000 sets of nursing care bed and mattress which 3D shape is identical with the applied mark. The company spent USD 2,400,000 to advertise the bed in newspaper and USD 20,000,000 in TV commercial during the past five years. Paramount produced on-line questionnaire results which showed more than 60 % of relevant traders have recognized the shape as a series of Paramount Bed.

 

IP High Court ruling

The IP High Court dismissed the allegation entirely, stating that the produced evidences are unpersuasive to conclude the 3D shape acquired distinctiveness as a source indicator of Paramount Bed’s business because of below-mentioned reasons.

  1. As long as nursing care beds are likely to be used by general public, questionnaire results answered by traders are insufficient to demonstrate acquired distinctiveness among relevant consumers.
  2. Given the shape of applied mark occasionally appears while nursing care bed is in operation and the bed has coverlet on it in ordinary days, it is questionable whether relevant consumers have perceived the shape of applied mark as a source indicator.
  3. Besides, catalogs and advertisements pertinent to Paramount nursing care bed show configurations of the bed other than the shape of applied mark.

Based on the foregoing, the court upheld JPO decision.


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

JPO refused to register 3D shape of Mitsubishi Electric’s spiral escalator

The Appeal Board of Japan Patent Office (JPO) disallowed registration of 3D shape of Mitsubishi Electric’s spiral escalator due to lack of inherent distinctiveness and secondary meaning in relation to escalators, class 7. [Appeal case no. 2017-6855]

Spiral escalator

Mitsubishi Electric Corporation first developed the spiral escalator in 1985, and has been the world’s first and sole manufacturer of spiral escalators. Spiral escalator is a special design type of escalator in the form of a spiral/helical with curved steps.
On May 3, 2016, Mitsubishi Electric filed a trademark application for 3D shape of spiral escalator (see below) by designating escalators in class 7 to the JPO [TM application no. 2016-23374].

The JPO examiner totally refused the application based on Article 3(1)(iii) of the Japan Trademark Law stating that the applied mark can be easily seen as a 3D shape of escalator and the shape does solely consist of a common configuration to achieve the basic function of escalator. If so, the applied mark lacks distinctiveness as a source indicator.

To dispute the refusal, Mitsubishi Electric filed an appeal on May 12, 2017.

Appeal Board’s decision

The Appeal Board, however, upheld the examiner’s decision on the ground and dismissed Mitsubishi’s allegation by stating that relevant consumers and traders shall conceive of an escalator designed to enhance its function or sensuousness at the sight of applied mark.

Acquired distinctiveness

Mitsubishi Electric also argued that even if the applied mark is deemed descriptive in relation to escalators, it shall be registrable based on Article 3(2) due to acquired distinctiveness of the mark because Mitsubishi Electric Spiral Escalators has achieved 100 % market share in the world and continuously used the 3D shape on escalators for more than three decades.

Article 3(2) is a provision to allow registration of applied mark if, as a result of substantial use of the mark in fact, consumers are able to connect the mark with a source indicator of designated goods or services.

Under the totality of the circumstances, the Appeal Board dismissed the allegation as well.

The Board found that regardless of 100 % market share in the category of spiral escalators, Mitsubishi Electric’s domestic supply record of 24 units in the last thirty years shall be a trivial quantity in comparison with total number of escalators in operation. Besides, questionnaire result rather shows a source of the applied mark is unknown to more than 60% of the questionee.

Based on the foregoing, the Board questioned whether applied mark has acquired distinctiveness through actual use in relation to escalators and consequently refused to register the mark based on Article 3(1)(iii) and 3(2) of the Trademark Law.


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

Trademark registration for Kikkoman’s Soy sauce 3D Bottle

In October 11, 2016, Kikkoman Corporation, the world’s leading producer of soy sauce, filed an application for trademark registration at the Japan Patent Office (JPO) for the following three-dimensional colored mark for soy sauce in class 30.

Red-capped Kikkoman soy sauce dispenser

Iconic red-capped Kikkoman soy sauce dispenser was introduced in 1961 and has been in continuous production ever since. It was developed by Kenji Ekuan, a Japanese Navy sailor former naval academy student who dedicated his life to design when he left the service. Its unique shape took three years and over a hundred prototypes to perfect, but the teardrop design and dripless spout have become a staple of restaurant condiments all around the world. The bottle’s design hasn’t changed over the past 50 years.

JPO Examination/Acquired distinctiveness

The JPO examiner initially notified her refusal due to a lack of inherent distinctiveness in relation to say sauce.

In a response to the office action, Kikkoman argued acquired distinctiveness of the 3D bottle arising from uniqueness of its shape and substantial use for over five decades.

According to news release from Kikkoman, over 500 million of the bottles have been sold since the design was first introduced and distributed in approximately a hundred countries worldwide. Red-capped Kikkoman soy sauce dispenser has already been registered as 3D mark in US, EU, Ukraine, Norway, Russia, Australia.

In March 30, 2018, the JPO granted trademark registration based on Article 3(2) of the Trademark Law by finding acquired distinctiveness of the 3D color mark as a source indicator of Kikkoman.
[TM Registration No. 6031041]

It is just a 3D shape of electronic baccarat shoe, or trademark?

In a lawsuit disputing adequacy of decision by the JPO Appeal Board (Appeal case no. 2015-907) to refuse the applied 3D mark (TM2014-5943, class 28), consisting of a three-dimensional shape of electronic baccarat shoe with the program enabling to reduce the chance of foreign cards and eliminate dealer mistakes, due to lack of  distinctiveness and secondary meaning, the IP High Court sustained the decision being appealed.
[Case no. Heisei28(Gyo-ke)10266,  Decision date: September 27, 2017]

Inherent distinctiveness of the 3D shape

Plaintiff, a Japanese manufacturer and distributor of the ANGEL EYE electronic baccarat shoe, asserted that the 3D shape of ANGEL EYE, being the first products in the industry, is not an essential shape to make it free for public use since no competitors have dealt with same type of product other than plaintiff so far. Besides, a fact that the 3D shape has been registered in the legal gambling countries, e.g. US, EU, AU, RU, Malaysia and NZ, will rather bolster necessity to allow exclusive right on the shape.

However, the Court opposed to plaintiff. “It is inadequate to allow plaintiff to use the 3D shape exclusively. Applied 3D mark can be perceived objectively as a general shape of electronic baccarat shoe aimed to fulfill its original function and produce aesthetic image. If so, it may disorder a fair marketplace to allow exclusive use to plaintiff just because of a first-to-file. A mere fact of trademark registrations in countries where the ANGEL EYE has been distributed is insufficient to admit trademark registration in our nation since the goods is yet to be distributed in Japan.” Accordingly, the Court refused Applied 3D mark based on Article 3(1)(iii).

 

Secondary meaning of Applied 3D mark

Plaintiff argued Applied 3D mark has already served to function as a source indicator by means of substantial use of the mark sine 2005. Plaintiff exported 11,481 units (sale proceeds: 2.7 billion yen) over the lase decade and has achieved 90 % market share in Macau, the world’s largest casino gambling hub.

In this respect, the Court ruled in favor of the JPO. As plaintiff admits, the shoe has not been manufactured for domestic use. Any evidence suggesting a high degree of recognition to Applied 3D mark in foreign countries is neither relevant nor persuasive. Unless plaintiff demonstrates that domestic consumers have become aware of such recognition, it is groundless to find Applied 3D mark would satisfy requisite of secondary meaning based on Article 3(2) of the Japan Trademark Law.


The case raises a question: What is a role of the Trademark Law where applied mark, being registered in foreign nations,  confronts with an insuperable refusal attributable to legal restrictions on domestic use of the mark?
Unsuccessful domestic registration prevents domestic company from utilizing the Madrid Protocol and protecting his/her vital brands on the global market in an effective and economical manner.  

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

3D shape of Zippo lighters registrable when a lighter lid open, but unregistrable when closed

In an appeal to the refusal decision against trademark application no. 2014-8964 for a three dimensional shape of box-type lighter in connection with lighters of class 34 filed by ZIPPO Manufacturing Company (US), the Appeal Board of Japan Patent Office (JPO), after stating the application impermissibly contains two 3D marks, namely Shape A with a lighter lid closed and Shape B with a lighter lid open, ruled as follows.

Shape A
Shape A can be easily perceived as a shape of box-type lighter with the lid closed in connection with the goods in dispute. Besides, as a matter of fact, similar lighters are commercially produced and distributed in general. If so, relevant traders and consumers at the sight of Shape A  are likely to conceive the shape as a mere indication of the lighter.  Thus, Shape A is objectionable based on Article 3(1)(iii) of the Trademark Law since the shape solely consists of a shape commonly used on lighters.

Even if Shape A corresponds to the 3D shape of “ZIPPO Brushed Chrome 200” substantially produced and promoted by applicant, it is questioned whether Shape A serves to function as a source indicator since presumably traders and consumers distinguish applicant’s lighters by the “ZIPPO” letter marked at the bottom of the lighter where the lid remains closed. Accordingly, Shape A is unregistrable based on Article 3(2) as well.

Shape B
Three dimensional shapes cited for refusal during initial examination are all related to box-type lighters with a lid closed. As long as there shows no reference to lighters with a lid open in the refusal decision, it should be construed that the initial examination just questioned Shape A, not B.

Since applicant amended to delete Shape A from the application, the initial decision lacks legal ground to refusal the applied mark of Shape B based on Article 3(1)(iii) accordingly.

As a conclusion, the Board admits to register the applied 3D mark consisting of Shape B in connection with lighters.
[Appeal case no. 2016-2368]


It is worthy to note that in an attempt to register 3D shape of goods, a hidden shape is considered an independent mark from the shape perceivable from appearance of the goods.
Besides, the JPO allowed to delete one of 3D marks depicted in the application document without detrimental effect to the applicant despite that the Trademark Law prohibits amendment of mark amounting to change its gist.

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

Can shape of musical instruments play a role of trademark?

In a dispute of registrability to a unique three-dimensional shape of electric violins, the Appeal Board admitted protection of the mark based on distinctiveness acquired by means of substantial publicity of the violins [Appeal case no. 2016-1859].

YAMAHA Corporation applied for 3D shape of electric violin promoted under the name of “SILENT Violin” by designating electric violins of class 15 on September 24, 2014 [TM application no. 2014-80685].

 


Initial examination

Examiner rejected the applied mark by stating that;

“Unsymmetrical appearance of the applied mark can still be perceived as a three-dimensional shape of electric or electronic violins in its entirety.According to information retrieved from the websites, unsymmetrical violins have been distributed with an attempt to aesthetic appearance or weight saving.Admittedly, the applied 3D shape contributes to enhance function or aesthetic appeal of electric violins, however, the shape is deemed equivalent to a mark solely consisting of the shape of goods in a common manner to the extent that relevant traders and/or consumers are unlikely to recognize the shape as a source indicator. Hence, the mark is subject to Article 3(1)(iii) of the Trademark Law.”

Article 3(1)(iii) of the Trademark Law

Any trademark to be used in connection with goods or services pertaining to the business of an applicant may be registered, unless the trademark:

(iii) consists solely of a mark indicating, in a common manner, in the case of goods, the place of origin, place of sale, quality, raw materials, efficacy, intended purpose, quantity, shape (including shape of packages), price, the method or time of production or use, or, in the case of services, the location of provision, quality, articles to be used in such provision, efficacy, intended purpose, quantity, modes, price or method or time of provision;


Appeal Trial

In this regard, the Appeal Board also sustained examiner’s decision and dismissed applicant argument of inherent distinctiveness of the applied 3D shape.

In the meantime, the Board granted protection of the 3D shape due to acquired distinctiveness based on Article 3(2) of the Trademark Law.

Article 3(2) of the Trademark Law

Notwithstanding the preceding paragraph, a trademark that falls under any of items (iii) to (v) of the preceding paragraph may be registered if, as a result of the use of the trademark, consumers are able to recognize the goods or services as those pertaining to a business of a particular person.

Acquired distinctiveness

YAMAHA Corporation has distributed electric violins “SILENT Violin” with a configuration of applied mark since 1997.
http://usa.yamaha.com/products/musical-instruments/strings/silentviolins/
The 3D shape has been continuously promoted in musical instruments magazines, a website and catalogues of applicant, and newspapers in a manner that readers can be attracted by its unique design. Winning various design awards and appearing in school textbooks as an example of industrial designs bolster remarkable reputation to the shape as well. Annual sale of “SILENT Violin” exceeding 100 million yen nationwide for last fifteen years is extremely higher than competitors.

Based on the foregoing, the Board stated;

It should be concluded that as a result of continuous and substantive use of the applied 3D mark since 1997, relevant consumers casting a glance at the mark are likely to conceive it as a source indicator of applicant business when used on electric violins.
Thus, the applied mark is eligible for registration in connection with electric violins of class 15 based on Article 3(2) of the Trademark Law.


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

 

 

Converse unsuccessful in obtaining 3D trademark protection of Chuck Taylor All Star sneakers

The Appeal Board of Japan Patent Office (JPO) decided to reject protection of a three-dimensional shape of Chuck Taylor All Star sneakers in connection with “sneakers” in class 25 (TM application no. 2014-79258) based on Article 3(1)(iii) of the Trademark Law by stating that the applied 3D mark, solely consisting of a shape commonly used on High Top Sneakers, is expectedly perceived as shape aiming to enhance aesthetic appeal in the mind of consumers and deemed inherently descriptive accordingly.
[Appeal case no. 2015-14749, January 18, 2017]

The Board admitted Chuck Taylor All Star sneaker as well as its name have become well-known as a source indicator of classic High Top Sneaker based on the facts that (i) Converse, a US merchant, has consecutively promoted the sneaker since 1917 without material change of the design, (ii) 5.2 million pairs of the sneaker were purchased in Japan since April 2008 at least, and (iii) it was continuously featured on newspapers and magazines.
However, the Board concluded it remained unclear whether the applied 3D shape has become well-known in itself and consumers are unlikely to recognize the shape as a source indicator on the following grounds.

  • Shape of goods essentially results from functional or aesthetic appeal. Unlike in the case of trademark depicted in the flat such as letter, figurative element, or symbols, consumers are neither accustomed nor likely to recognize 3D shape of goods as a role to indicate its source in general.
  • Similar sneakers have been distributed by many suppliers, e.g. GU, LEVIS, ADIDAS, RALPH LAUREN, PUMA, NIKE, MOONSTAR. As long as the shape already becomes a standard design of High Top Sneakers among competitors, granting exclusive protection to the applied 3D mark may disorder the status quo undesirably. Even if similar sneaks turn out to be imitations or counterfeits of Chuck Taylor All Star sneaker as applicant argued, unless applicant takes remedial actions to cease the products, the argument is less persuasive and inadmissible.
  • According to market survey conducted at Tokyo, Aichi and Osaka involving 1,500 interviewees, more than half of them could not perceive the applied 3D mark as Chuck Taylor All Star sneaker. 60% perception among primary consumers from age 10 to 49 is still insufficient.

It is undeniable that applicant neglected similar sneakers by numerous competitors for years and the circumstance adversely affected to the decision as market survey did in contradiction to its expected role.
Timing is of the essence to protect 3D shape of goods successfully.  

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

Registrability of two alphabetical letter trademarks in Japan

According to Article 3(1)(v) of the Japanese Trademark Law,

Any trademark solely consisted of a very simple and common mark may not be registered.

 Trademark Examination Guideline(TEG) pertinent to the article (Chapter I, Part 7) specifies that:

Trademarks composed of (a) one or two alphabetical letter, (b) two alphabetical letters hyphened, or (c) one or two alphabetical letter preceded or followed by a term representing business entity, e.g. “Co.” “Ltd.”, are not registrable on the grounds of Article 3(1)(v).

 In the meantime, trademarks consisted of (a) two alphabetical letters combined with “&”, (b) two alphabetical letters depicted in monogram, (c) Japanese katakana characters transliterating two alphabetical letters, or (d) two alphabetical letter represented in a unique design do not fall under the article.

 http://www.jpo.go.jp/tetuzuki_e/t_tokkyo_e/pdf/tt1302-002/1-7.pdf

You had better note that TEG admits to register Japanese katakana characters transliterating two alphabetical letters. That means, even if alphabetical letter trademark would fail to register due to the article, you may have an option to register transliteration of the mark in Japan.
Consequently, one or two alphabetical letter trademarks in standard character, including acronyms and abbreviations are under normal circumstances not registrable.
 As an exception, provided that the producer so effectively markets the product with the mark that consumers come to immediately associate the mark with only that producer of that particular kind of goods and thus one or two alphabetical letter trademarks attain acquired distinctiveness, the marks are entitled to trademark protection on the basis of Article 3(2).

 

Article 3(2) of the Japanese Trademark Law stipulates that:

Notwithstanding the preceding paragraph, a trademark that falls under any of items (iii) to (v) of the preceding paragraph may be registered if, as a result of the use of the trademark, consumers are able to recognize the goods or services as those pertaining to a business of a particular person.