„Model: Sam“ - Use as a trademark or a simple model designation?

The German Federal Court of Justice (BGH) recently rendered a decision on trademark use in the field of textiles that is worth reading.

In general, use as a trademark requires that a significant part of the relevant public recognizes a sign as indicating the origin of a product. For that, it is not sufficient that a sign is originally distinctive and that its use is not plainly descriptive. Instead, use as a trademark has to be assessed in each case individually taking into account all circumstances of the case. Thus, use of a first name like “SAM” as a model designation can also constitute use as a trademark and, in consequence, be deemed trademark infringement.

BACKGROUND

For years, there has been a trend to register first names as brands for textiles. At the same time, there exists a common practice in the textile industry to distinguish different products and product series within a manufacturer’s portfolio by using first names (examples: SAM, MO, JULIA, NINA, LARISSA or STELLA). This led to several warning letters and infringement proceedings in the past. Conflicting decisions of different German courts made it hard to determine whether or not a specific use of a sign could be deemed as a trademark infringement or not.

One of these infringement cases now made it all the way to the German Federal Court of Justice. In its decision of 7 March 2019 (BGH I ZR 195/17 – SAM), the Court overruled a decision of the Higher Regional Court of Frankfurt by saying that the original decision had not taken into account all relevant factors of the case and that it was not sufficient to simply find a sign to be distinctive and not used in a plainly descriptive manner to assume use as a trademark and, thus, find an infringement of an identical or similar registration.

FACTS

In the case that was brought before the Federal Court of Justice, the owner of German trademark No. 2004517 for “SAM” (word mark), registered inter alia for “clothing” in international class 25, had claimed trademark infringement by use of the sign “SAM” in an online shop for trousers. More specifically, the product description of trousers offered under the name “EUREX BY BRAX” mentioned that the trousers were “Model: Sam” – by that referring to the specific cut and fit of the pants. While the District Court of Frankfurt as well as the Higher Regional Court of Frankfurt had held that such use of the word “SAM” was use as a trademark and would, accordingly, constitute infringement of the registered trademark “SAM”, the District Court of Munich in a parallel proceeding had found the same use non-infringing. The diverging decisions prompted the Higher Regional Court of Frankfurt to allow the case to proceed to the Federal Court of Justice for clarification.

THE DECISION

The Court reviewed the case, examined all relevant aspects and dismissed most of the reasons of the defendant fashion company as unfounded. Applying constant case law, the Court found that the defendant had used an identical sign “SAM” in business without the consent of the trademark owner for goods, namely, trousers, that were identical to the goods for which the plaintiff’s trademark was protected in Germany.

The key issue then was whether or not the Higher Regional Court of Frankfurt had rightly assessed the impact that use of the contested sign had had on the registered trademark. It found that this had not been the case. The Higher Regional Court of Frankfurt had missed to make any substantial findings on how exactly the relevant public perceived the sign "SAM" in the specific online advertisement and whether or not “SAM” was understood as an indication of origin for clothing and, thus, seen as a trademark. It will now have a chance to discuss the case further, taking into account several issues that the Federal Court of Justice would like to see addressed, in particular:

• If it is common in a particular industry to use certain characters as model names, their attachment to the product itself or to labels can be understood as an indication of origin by the relevant public. In the clothing and retail industry, the use of first names to designate models by manufacturers is quite common.
• If a specific model designation is well-known (like “501” for Jeans), it seems reasonable to assume that the public will perceive it as a trademark – even if it is not highlighted within an advertisement or sales offer.
• If it cannot be assumed that a specific model designation is well-known, the design of the advertisement or sales offer in question must be considered carefully when examining whether use of the model designation also serves as an indication of origin. If the model designation is used in direct connection with the manufacturer’s name or an umbrella mark, the public is likely to understand it a source indicator as well.
• If a model designation is not known as a trademark and is used in a way and place where the public is rather unlikely to expect trademark use, it will have to be determined on a case-by-case basis whether or not the specific use will be deemed use as a trademark.

CONCLUSION

It remains to be seen how the Higher Regional Court of Frankfurt will apply these terms to the current “SAM” case and it does not seem unreasonable to believe that the Federal Court of Justice might have to deal with the case again in a year or two.

For the moment, the decision of the Federal Court of Justice has not really brought any clarification for the clothing and retail industry as to when exactly use of a model designation that is identical to a registered trademark constitutes trademark infringement. However, the Court has given at least some guidance that can help to counteract the impression of an indication of origin and, thus, trademark infringement. For instance, fashion companies and retailers that would like to use a name as part of a model designation, should carefully consider how to exactly position the model designation on its goods and in advertisements and sales offers. If a sign is printed on the goods itself in a place where a consumer expects to see a trademark, there is a high risk that such use will be found trademark infringing. The same applies to use on product labels or packaging. Also, when describing goods online or in print media, care should be taken to ensure that the model designation is used in a place where it seems rather unlikely that the consumer will expect to a see a trademark. It should, thus, not be used in direct proximity to the name of the manufacturer or another trademark like an umbrella brand name.

Should you have doubts if your use of a specific model designation might (also) be considered use as a trademark, you are welcome to contact us for an assessment at info@lexdellmeier.com

The decision of the Federal Court of Justice (BGH I ZR 195/17 – SAM, in German only) can be found at

http://juris.bundesgerichtshof.de/cgi-bin/rechtsprechung/document.py?Gericht=bgh&Art=en&sid=bff458a02f83665515d8de65b40888f7&nr=95307&pos=0&anz=1