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German Federal Court of Justice confirms Protectability of "Sparkassen-Red"

The abstract colour mark “red” registered in favour of the German Sparkassenverband, an association of savings banks, is indeed registrable. The German Federal Court of Justice (Bundesgerichtshof – "BGH") has declined a request to delete the "Sparkassen-Red" from the German trademark register filed by the Spanish bank Santander, which also uses the colour red as its corporate colour.

Background

The umbrella association of the Sparkassen Finance Group had registered the abstract colour mark "red" (HKS 13) at the German Patent and Trademark Office (Deutsches Patent- und Markenamt – "DPMA") on 7 February 2002. The mark was registered in class 36 on 11 July 2007 by means of acquired distinctiveness (Verkehrsdurchsetzung) for the services "finances, namely retail banking (banking services for private customers)". Whereas the DPMA declined the request for deletion by Santander, the Federal Patent Court (Bundespatentgericht – "BPatG") ordered the deletion of the contour-free colour mark from the register in the following appeal procedure. The BPatG argued that the "Sparkassen-Red" was neither originally distinctive, nor is it perceived as a product trademark due to its actual use. After the BPatG had postponed the proceeding in order to call the European Court of Justice ("ECJ") to decide on several questions in connection with the classification of the present public surveys, it based its decision on the fact that the consumer survey with regard to the publicity of the "Sparkassen-Red" had taken place at the end of 2005 and, therefore, not until almost four years after the application at the DMPA.

The decision of the BGH dated 21 July 2016 (case reference I ZB 52/16)

With its decision dated 21 July 2016, the BGH decided that Sparkasse's well-known red colour mark is registrable and thus, must not be deleted from the German trademark register.

The BGH hereby ends the legal dispute which has been pending against Santander for six years. The core of the dispute was the question whether and, respectively, at which level of publicity a colour, which is usually only perceived as a decorative element by the public, acts as an indication of commercial origin and at what point in time this public awareness must exist.

On appeal by Sparkasse, the BGH disapproved the BPatG's point of view. According to the present expert opinions, the "Sparkassen-Red" had not gained distinctiveness at the time of the trademark application in 2002; the opinions do however justify the assumption that the colour had reached a level of distinction by the time of the decision on the application for cancellation. According to the BGH, this was the decisive factor.

Comment

The proceedings with respect to the "Sparkassen-Red" reveal a number of important insights for applicants of abstract colour marks:

First of all, the decision of the BGH is in line with the recent decisions on the contour-free colour marks "Nivea-Blue" and "Langenscheidt-Yellow" according to which abstract colour marks basically do not act as an indication of commercial origin with respect to the specific goods or services. Therefore, it is not sufficient to use the colour as a mere eye-catcher for a product, as it usually is the case.

Moreover, abstract colour marks are to gain the character to identify the claimed products or services as originating from a certain company through extensive, specific use within the relevant public. This presents a high hurdle which necessitates the presentation of expert opinions containing highly differentiated questions. Only if a degree of market recognition of more than 50% can be determined, the sign will be awarded the necessary level of distinctiveness reached through actual use.

In the event a colour mark clears this hurdle, as it is the case with regard to "Sparkassen-Red", the question in terms of the scope of protection in case of infringement proceedings arises. "Santander-Red", e.g., has the shade HKS 14 and, thus, differs from "Sparkassen-Red" only in nuances. Considering that the addressed public usually does not perceive the colliding marks next to each other but has to trust their recollection when comparing the signs, it cannot be ruled out that Santander will have to modify its brand presentation after the recent BGH decision. A decision by an infringement court in this regard is yet to be issued. Since there are no precedents as to how colours can be compared objectively and precisely in cases of collision, the influence of the recent "Sparkassen-Red" decision remains to be seen.

In practice, this decision will probably not cause the number of abstract colour marks to increase extraordinarily, since the requirements in this respect are very high. However, contoured colour marks, i.e. marks where the colour symbol has a certain shape, such as a circle or a cube, are more likely to be granted protection. In such cases, the requirements to grant protection are significantly lower.

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