Grand Board no fools in COVIDIOT trade mark case

The Grand Board of Appeal of the European Union Intellectual Property Office (the "Grand Board") has issued its long-awaited decision in respect of an appeal against the refusal of a European Union Trade Mark application to register the figurative mark COVIDIOT (the "Application") (see press release and link to decision here).

Background

The Application was filed by Matthias Zirnsack on 12 August 2020 for the figurative mark:

The Application covered the following goods:

Class 6: Metal clips.

Class 9: Computer gaming software; mobile apps.

Class 28: Board games; toys.

The Application was refused for being contrary to both Article 7(1)(f) (being contrary to public policy or accepted principles of morality) and Article 7(1)(b) (lacking in distinctive character) of EU Regulation 2017/1001 ("EUTMR"). 

The Applicant appealed and the case was referred to the Grand Board due to the degree of legal complexity of the case and its importance, namely with respect to the impact of fundamental rights in the scope of examination of Article 7(1) EUTMR.

Third parties were invited to file observations, in accordance with Article 37(6) of EU Regulation 2018/625 and the International Trademark Association ("INTA") filed observations which can be found here. INTA was keen that adjudicator bodies should make a factual assessment of the public's perception of morality and strike a balance between that public perception and freedom of expression. To that end, it proposed a three-stage test to: 1) verify public perception of the content of a mark; 2) enquire whether a majority of the public would consider that to be against accepted principles of morality; and 3) as appropriate, take steps to strike a balance between the right of free speech and the interest of the public to prohibit the registration of marks that go against accepted principles of morality.

The issues

The issues under examination by the Grand Board included:

• the scope of the principles of morality under consideration;
• the relevant public;
• the territory in question;
• the timing of the assessment; and
• ensuring that protection of fundamental rights (including that of freedom of expression) is taken into account.

Such assessment was to have regard to the meaning of COVIDIOT, the representation of the mark, including the element of a jester's hat, and the goods applied for.

The decision

The Grand Board undertook a very detailed analysis of the matters at issue. It applied guidance issued by the Court of Justice of the European Union ("CJEU") in a case concerning the mark FACK JU GÖHTE (see our earlier blog post here), and referred to and built upon other recent case law, such as the refusal of an application for the mark PABLO ESCOBAR (see our earlier blog post here). It furthermore examined founding principles of the European Union, considering, in particular, freedom of expression under Article 11 and freedom of the arts under Article 13 of the Charter of Fundamental Rights of the European Union plus fundamental values and interests set out in The Treaty on European Union.

Principles of morality

First, in looking at Article 7(1)(f), the Grand Board noted that a refusal under this ground does not depend on the finding that use is prohibited, e.g. under national laws on hate speech or obscenity. Instead, the privileges of trade mark registration should not be granted in favour of signs that are contrary to public policy or accepted principles of morality. The question whether a trade mark can be used is separate from whether it was refused registration under Article 7(1)(f).

It stated that a sign is contrary to "accepted principles of morality" if it is perceived by the relevant public as contrary to the fundamental moral values and standards to which a society adheres at a given time. Noting the point made by INTA, the provision does not cover principles of morality generally but those that are "accepted". This should be determined according to social consensus prevailing in that society. When evaluating whether a mark should be refused, the interests of the applicant must be balanced with public interests. The Grand Board noted that "the organs of public administration should not positively assist those who wish to further their business aims by using trade marks that are contrary to certain basic values of civilised society". Taking into account both its usual meaning and the context in which it is generally used, it must cross the boundary from being merely irreverent or distasteful into being seriously abusive or likely to cause deep offence.

The relevant public

The Grand Board noted the examination of the relevant public is to be based on the perception of a reasonable person with average thresholds of sensitivity and tolerance, taking into account the context in which the mark may be encountered and, where appropriate, the particular circumstances of the part of the relevant territory concerned. It does not need to be the perception of the majority, as suggested by INTA, as long as at least a non-negligible part of the relevant public will perceive it as offensive, indecent or repulsive. The relevant public may go beyond the target public of the goods/services of the sign at issue to those who may merely come across it in their daily lives and this will depend on the context of its use.

The territory

The criteria and the abstract interpretation of the threshold for whether a mark is morally acceptable must be the same for the whole EU but the objection need not exist throughout the entire EU. The trade mark must be refused if the grounds for objection exist in at least part of the European Union, taking into account linguistic, historic, social and cultural factors. Here the contested decision was based on the perception of the German- and English-speaking public, due to the widespread use of both word elements, either directly or with linguistic adaptations, by this part of the public. The Grand Board focused on the English-speaking part of the public, that being adequate for the provision to apply.

Timing of the assessment

Contrary to the applicant's assertions that the assessment must be made at the time of the decision and, that being the case, that the term had lost any shocking meaning, the Grand Board found that the relevant point in time to consider whether the mark offends against accepted principles of morality is at the date of filing.

Understanding of the sign applied for, figurative representation of the sign and goods applied for

The Grand Board noted the composition of the sign being the word COVIDIOT, with the word element IDIOT in bold, on a yellow rectangular label with three figures inclined in different directions and arranged like a jester's hat. The word COVID being an abbreviation of "coronavirus disease", it went on to talk about the scale and consequences of the pandemic and the measures taken against it by governments globally, noting in particular the situation at the time the contested application was filed. It then noted the meaning of the word IDIOT, being derogatory, and being widely recognised and understood across the Union because it resembles variations on the same word in multiple languages. The Grand Board went on to assess the perception of the word COVIDIOT, given its dictionary definition and its use amongst the relevant public, finding that its meaning amounted to a label applied to individuals criticised for not following public health advice, or engaging in other idiotic conduct, in relation to the pandemic and conversely that it was also used by those so criticised in counterattack. Such use was widespread in the media and by the public but it had no relevant use in any commercial environment.

The Grand Board noted that, as well as the word element, the sign applied for contains the figurative elements of the stylised representation of headgear composed of blue, yellow and red cone-shaped playing figures resembling a jester's cap, that being the symbol of a fool.

It found that the combination of the word COVID with the word IDIOT, and the inclusion of a jester's hat, used in the commercial context of a game, grossly trivialised the pandemic, creating the impression it is something to take lightly and have a laugh about. At the time of the application thousands of people were dying, wide-ranging measures were being taken to combat the spread of COVID-19 at local, national, EU and worldwide level, and a vaccine had yet to become available. Therefore, when taken in this context, by ridiculing COVID-19 in the sign, as used for games, it flippantly downplayed the seriousness of the pandemic and the harm done by the disease, which impacted the fundamental values and interests of the European Union.

The Board felt that the goods applied for, being connected to a game, further served to trivialise the pandemic.

It stated "What is fine for a socially conducted debate, is not necessarily entitled to registration as a trade mark".  Trade mark registration must neither trivialise offensive signs, nor give them a stage or accustom the public to them. The gravity of the effect of trivialisation is so important this weighs against the applicant's interests. It found the mark would be likely to shock or offend, not only victims of the pandemic and their families, but also any person who, on EU territory, encounters that mark and has average sensitivity and tolerance thresholds. The applicant had not supplied any evidence to show widespread commercial use of the sign COVIDIOT which could cause the public to perceive the mark in a different way, nor could the Board find any such evidence.

Fundamental rights

Taking a deeper dive, the Board considered the balance to be struck between the applicant's fundamental rights to freedom of expression and freedom of art, particularly satire and other fundamental rights and freedoms, in the context of an application for a trade mark and the potential refusal thereof, being a limitation to those rights. It found that whilst anyone is free to hold and express opinions and to receive and impart information and ideas, this freedom is subject to exceptions, which must have a legal basis and must be proportionate.

It noted a trade mark application falls within the scope of protection of freedom of expression. Any limitation to this must be based in law, and refusal on the grounds of being contrary to public policy or accepted principles of morality under Article 7(1)(f) EUTMR fulfilled this criteria. Furthermore, it recognised that a limitation to such right must be necessary and genuinely meet objectives of general interest recognised by the Union or the need to protect the rights and freedoms of others, such as protecting the well-being of citizens, their economic interests, solidarity and mutual respect and those of life and health. Refusing registration of a mark which would be perceived by the relevant public at the filing date as contrary to the fundamental moral values and standards of society could be seen as necessary in this way.

The Board went on to examine the categorisation of expression of an opinion, according to the importance of its content in order to determine the extent of the protection granted. It found that commercial expression may be afforded different protection to political expression and where a trade mark has political content, this does not afford it greater protection because a trade mark is not essential to the expression of that political opinion. This was in line with the finding that refusal of a trade mark is independent from the possibility of using the sign, either in trade or in political debate. As for freedom of art, the Board found that "not any figurative trade mark with a provocative term is art or satire", and there was no evidence in this case that it was ever meant or perceived as such.

The Board confirmed the same principles would apply in the context of a refusal on the grounds that the mark lacks distinctive character. If such grounds apply and a mark is refused, this would not preclude use of the expression as a sign in trade or in political debate.

Conclusion

It followed from the Grand Board's reasoning that, given the circumstances of the pandemic, the sign applied for did offend against accepted principles of morality due to the word and figurative elements plus the goods applied for on the basis it trivialised COVID-19. Refusal was based in law and would be proportionate and necessary when public interest was balanced against the applicant's freedom of expression, because freedom to use the mark or to convey a political expression would not be prevented by refusing to register the mark. Consequently, the refusal of the mark on this basis was justified.

Commentary

Although it may have been possible to decide the case simply on the seemingly more straightforward ground that the mark lacks distinctive character, it is interesting to see that the EUIPO was keen to explore the point dealing with the mark being contrary to public policy or accepted principles of morality in detail by referring the case to the Grand Board and inviting third party observations. The case shows that these issues remain live in an age where it may seem that "anything goes" and that they have wide applicability, beyond perhaps more common culprits such as obviously offensive language or names associated with the criminal world. Since the time of the application was a relevant factor in the assessment, it is perhaps arguable that an application for the same mark may be less likely to run into such objections the further we move away from the period of the COVID-19 pandemic. We may also muse that the desire to use and register such a mark may have waned, being reflective of events at that time, so of the moment.