Whether two trademarks are likely to cause confusion in the market ultimately should be determined based on the actual circumstances concerning the use of the trademarks of both parties to satisfy the necessity of trademark protection, and this is also how a trademark registration case differs from a trademark invalidation case in the basis of consideration(Taiwan)

2017 年 5 月 31 日

2017.3.30
Jane Tsai

I. Summary of facts:
1. The Plaintiff designated “CROWN&FANCY and Device (crown shape)” for use on goods such as tea, coffee, tea candy, moon cakes and sushi. The mark was registered as No. 1285991 Trademark, whose right commenced on November 1, 2007 until October 31, 2017 (hereinafter, the “Trademark at Issue”). The Intervenor applied to invalidate the Trademark at Issue, since it was likely to confuse relevant consumers due to its similarity with “GOLD CROWN and Device (crown shape),” the trademark registered in 2003, designated for use on goods such as toasts and cakes, and relied on for invalidation.
2. Defendant Intellectual Property Office subsequently rendered the disposition that the registration of the Trademark at Issue, which was designated for use on part of the goods such as “tea candy, moon cakes, walnut cakes, pineapple cakes, cakes, cream puffs, sandwiches, egg tarts, and doughnuts,” should be revoked but the invalidation against the rest of the registration regarding designation for use on other goods was not valid. Dissatisfied with the invalidation portion, the Plaintiff filed administrative appeal, which was subsequently rejected. Dissatisfied, the Plaintiff brought this administrative action on the ground that the trademark relied on for invalidation had been registered for three years and only one trade show record was provided during the invalidation procedure without providing facts of actual sales of products such as cakes. The Intellectual Property Court rendered the 105-Hang-Shang-Su-100 Decision of March 30, 2017 (hereinafter, the “Decision”) to dismiss the Plaintiff’s complaint.

II. Gist of the Decision:
1. The invalidation applicant should have actually used its registered trademark in the market:
According to this Decision, since the Law adopts the principle of registration, actual market use of a trademark is not a precondition for trademark registration application. However, a trademark is a mark that identifies trading sources and its functions cannot be fulfilled unless it is actually used in the market so that goodwill can be further accumulated and trademark value created. Therefore, whether two trademarks are likely to cause confusion and misidentification in the market should be ultimately determined based on the actual use of the trademarks of the two parties in the market to satisfy the necessity of trademark protection. This is how a trademark registration application is different from a trademark invalidation case in the basis of consideration.
2. Facts suggesting the trademark relied on for invalidation was actually used on relevant cake products:
In this Decision, it was held that the event manual of the 13th Spring Exhibition of the Taipei International Chain and Franchise Exhibition during February 24 through 27, 2012 as well as participation photos and photos of awards submitted by the Intervenor contained texts and logos such as GOLD CROW cakes, cake products and the trademark relied on for invalidation. Therefore, the trademark relied on for invalidation was actually used on the above designated goods of similar nature such as cakes three years prior to the invalidation application in this case, and the Intervenor could certain apply for the trademark invalidation.
3. Significant overlap in marketing approaches and marketing sites:
According to the Decision, with respect to the marketing approaches of goods, since the marketing channels of goods or sites where goods are offered are identical, relevant consumers are more likely to be exposed to goods represented by both trademarks and thus are more likely to be confused and to misidentify. Conversely, if marketing channels such as direct marketing, electronic shopping, mail order, etc. are used, the likelihood of confusion and misidentification is lower as compared with marketing via physical stores. It is understood that since the two trademarks were designated for use on goods such as candy, cookie, bread and cakes and could both be marketed via online channels and physical channels, significant overlap existed in the marketing approaches and marketing sites of the goods for which the two trademarks were designated.
4. In conclusion, it was held in the Decision that the registration of the Trademark at issue violated Article 23, Paragraph 1, Subparagraph 13 of the Trademark Law before amendment and Article 30, Paragraph 1, Subparagraph 10 of the current Trademark Law, since the two trademarks were highly similar, part of the goods for which the Trademark at Issue was designated were identical or similar to those for which the trademark relied on for invalidation was designated, the trademark relied on for invalidation was highly distinctive, the marketing approaches and sites of the two trademarks highly overlapped, and the applicant of the Trademark at Issue was not in good faith. Therefore, the administrative appeal agency’s decision to reject the administrative appeal was not erroneous.