The so-called grace period for use in the EU Trademark Regulation is intended to give applicants the opportunity to protect their trademark and thus an important marketing tool before the product is firmly established on the market. It is always annoying when companies take unfair advantage of this provision and reapply for their trademarks shortly before the expiration of the grace period with the recognizable sole aim of circumventing the expiration of the grace period. The EUIPO Board of Appeal has now put a stop to this in a case where bad faith was quite obvious (EUIPO, Board of Appeal, decision of December 20, 2022, R 2018/2018-2 – WONG LO KAT).
The trademark application “WONG LO KAT” had been filed six days before the expiry of the grace period of an older mark by the same applicant for the same goods under the same sign. This new application was preceded by cancellation proceedings against the earlier, identical trademark of the same applicant where, in the end, the applicant was able to prove use only for part of the claimed goods.
The Board of Appeal drew on the principles from the Monopoly decision of the ECJ (ECJ, judgment of 21 April, 2021, T-663/19 – Monopoly) and held that repeat applications are not to be considered in bad faith as a matter of principle. However, the motives for the new applications and the chronology of events have to be taken into account when assessing whether the new application has been filed in bad faith. It is true that the burden of proof lies with the applicant. However, the applicant is in the best position to explain to the Board his strategy behind the new application and legitimate interests related thereto. However, the applicant has not commented on this and the Board could not identify any legitimate motives. On the contrary, the fact that the applicant had filed a new application for the trademark for all goods, although he had only been able to prove use for some of the goods in the previous cancellation proceedings, is an indication that the proprietor tried to circumvent the consequences of the use requirement by filing a new application. The fact that the new application was filed six days before the expiry of the grace period of the earlier mark also indicates bad faith. The new application was therefore cancelled.
The decision is to be welcomed. Together with the possibility of filing applications for broad terms like software or chemical products with a very broad scope of protection without limitation to a specific industry or field of use, the extension of the grace period for use over repeated trademarks in bad faith leads to an unjustified blocking effect of trademarks, which the use requirement is actually supposed to avoid. It is to be hoped that the authorities will not be too restrictive here and classify an application that is obviously filed in bad faith as such even if the list of goods of the old trademark and that of the new trademark do not match one hundred percent. Of course, there are good reasons for refiling a trademark application. However, anyone who pursues honest intentions will not find it difficult to explain these to the Office.