http://ipkitten.blogspot.com/2025/02/is-ferraris-testarossa-trade-mark-up.html
In the SIMCA decision (case T-327/12), the General Court found that the third-party application for a formerly famous trade mark that is still registered but has not been used for decades constitutes bad faith if the applicant intends to take advantage of the remaining reputation.
This judgment begs the question whether it also applies where the earlier trade mark is still used and registered. The German Patent Court recently denied bad faith in such a situation concerning Ferrari’s Testarossa trade mark (case 29 W (pat) 14/21).
Background
Ferrari used the Testa Rossa brand for a front-engine race car in the 1950s. From 1984 to 1996 it produced the Testarossa model as a streetcar. In total, more than 7,000 models of the Testarossa were built.
The applicant is the board member of a company that has been active in the toy and model car industry for around 50 years. For decades, the applicant has been in trade mark disputes with car manufacturers, particularly over licensing claims due to the reproduction of the car manufacturers’ brands on model cars.
The applicant filed several non-use revocation applications against ‘Testarossa’ trade marks of Ferrari. In particular, the EUIPO revoked two International Registrations and appeals are pending before the General Court (cases T-1103/23 and T-1104/23). The parties have also filed several opposition proceedings against each other’s ‘Testarossa’ and ‘Testa Rossa’ trade marks.
In 2015, the applicant filed for registration of German trade mark no. 302013070212 ‘Testa Rossa’ for various goods in classes 7, 8, 12, 18, 21 and 28. Ferrari filed an opposition and an invalidity application based on bad faith. The German Patent and Trade Mark Office suspended the opposition proceedings because of the invalidity application.
The German Patent and Trade Mark Office rejected the invalidity application. Ferrari appealed.
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The German Patent Court’s decision
The German Patent Court dismissed Ferrari’s appeal.
The judges recalled that the relevant point in time for the assessment of bad faith is the application date. Nevertheless, circumstances before and after said date can be taken into account if they allow conclusions as to the applicant’s intention on the application date.
Bad faith exists where it is clear from conclusive and consistent evidence that the proprietor of a trade mark did not apply for registration with the aim of participating in fair competition but rather with the intention of harming the interests of third parties in a manner contrary to fair commercial practices or with the intention of obtaining an exclusive right for purposes other than those inherent in the function of a trade mark, including the essential function of indicating origin.
The judges accepted none of the arguments put forth by Ferrari:
1. There were no indications that the applicant filed the trade mark as a speculative mark, meaning that it had no intention of using it but, instead, wanted to enforce it against third parties in an abusive manner.
2. The fact that the applicant filed many different ‘Testa Rossa’ marks in Germany and the EU for a broad range of goods and services does not allow the conclusion that the applicant tried to impede Ferrari’s use of its ‘Testarossa’ trade marks.
3. While the applicant did not use the ‘Testa Rossa’ trade marks himself, he licensed them to third parties for some of the goods. According to case law of the Court of Justice of the EU (‘CJEU’), it is not necessary for an applicant to know at the filing date for which goods and service he will use the mark. Further, due to legal disputes with Ferrari, the applicant had a legitimate reason to wait with using the marks.
4. A factor speaking against a bad faith application was that the applicant had not yet enforced its trade marks against third parties.
5. The revocation actions of the applicant against Ferrari’s ‘Testarossa’ trade marks on the basis of non-use did not indicate bad faith. The actions rather show that the applicant is of the opinion that Ferrari does not use its trade marks. Beyond that, the revocation actions were filed after the application date of the contested trade mark.
6. The fact that Ferrari established genuine use of ‘Testarossa’ for ‘automobiles and parts thereof’ was deemed not decisive because (enforceable) earlier rights constitute relative grounds for refusal, not absolute grounds.
7. Ferrari also relied on the SIMCA decision of the General Court. The judges made it clear that they had difficulties with this line of case law because novelty or creativity are not conditions for trade mark protection. However, the Court left open whether to follow the SIMCA ruling. Unlike in that case, Ferrari owns earlier enforceable rights for ‘automobiles and parts thereof’. This was considered sufficient to distinguish the cases. For this reason, the judges denied the need for a reference for a preliminary ruling to the CJEU.
The Neymar decision from the General Court (IPKat here) was also not deemed comparable because it concerned the name of a famous person. However, personality rights do not play a role with respect to the trade mark ‘Testa Rossa’.
8. The Court did also not see sufficient indications that the applicant acted with the intent to impede Ferrari’s business. Mere knowledge that a third party uses a trade mark is not enough for a finding of bad faith.
9. The fact that the contested trade mark might infringe Ferrari’s trade mark with a reputation was deemed irrelevant. This is the subject of relative grounds for refusal but cannot be asserted with respect to bad faith.
10. The judges saw no indication that the applicant intended to use the mark for purposes other than indicating the commercial origin of the goods. The fact that the applicant might have intended to profit from the reputation of the ‘Testarossa’ trade mark does not amount to improper use. The Court did not deem merely profiting from the (remaining) repute of a sign sufficient for bad faith.
Comment
The German Patent Court’s decision is difficult to reconcile with the SIMCA ruling. The only relevant difference between the cases seems to be that the SIMCA trade mark has not been used while Ferrari’s ‘Testarossa’ trade mark is still in use. This is certainly a differentiating factor but is it sufficient to deny bad faith? Arguing that Ferrari could act on the basis of its registered trade marks conflates the absolute and relative grounds for refusal. In Neoperl, the CJEU recently found that all absolute grounds for refusal are independent of each other (IPKat here). It would be surprising if the court held differently for the interplay between absolute and relative grounds.
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