No ‘Get Out of Jail Free’ card for Hasbro

The General Court (‘GC’) has refused an appeal by Hasbro Inc. (‘Hasbro’) regarding the decision to partially invalidate a registration of its MONOPOLY mark on the ground of bad faith.

Background

Once registered, an EUTM must be put to genuine use within five years of its registration date. Third parties may apply to revoke a registration which is more than five years old in respect of any goods/services for which the mark is registered in relation to which the mark has not been put to genuine use in the EU. In order to maintain the registration, the registrant must file proof that its mark has been genuinely used. Moreover, the registrant may be required to prove use of a registration which is older than five years if it relies on that registration in opposition, invalidation and/or infringement proceedings.

Hasbro filed an application for the mark MONOPOLY in April 2010 (the ‘2010 application’) for a broad range of goods and services in classes 9, 16, 28 and 41. It proceeded to registration in March 2011. Hasbro already owned three earlier EU registrations for the mark MONOPOLY which covered a range of goods also covered by the 2010 application.

In 2015, Kreativni Događaji d.o.o. (‘Kreativni’), applied to invalidate the registration of the 2010 application on the ground that the application had been filed in bad faith since it was allegedly a repeat filing by Hasbro of its existing registrations. The Cancellation Division rejected the application for invalidity on the basis that the 2010 application was not a clear indication of an intention to evade the obligation to prove use, and that no evidence had been put forward by Kreativni to support its allegations of bad faith. This decision was appealed by Kreativni, and the Second Board of Appeal of the EUIPO partially annulled the Cancellation Division’s decision, declaring the registration of the 2010 application invalid in respect of some of the goods and services covered (those which had been covered in Hasbro’s earlier registrations). The Board of Appeal found that the 2010 application had been filed in bad faith in respect of those goods and services. Hasbro then appealed this decision to the GC.

The General Court’s decision

The GC has now issued its decision. We have summarised some of the key points in the decision below.

The GC held that Hasbro’s filing strategy, which sought to circumvent the rule relating to proof of use, was effectively an abuse of law. Hasbro attempted to justify the 2010 application on the basis that it had sought to protect its mark in respect of other goods and services in order to keep up with developments in technology and its expanding business. The GC upheld the Board of Appeal’s decision to invalidate the registration for the goods and services which had previously been covered, but not to invalidate the registration in relation to goods and services which were not covered by the earlier registrations. 

Hasbro argued that allowing the contested decision to stand would lead to the Cancellation Division being swamped with similar cases of bad faith; that its mark was so famous that it would be fanciful to conceive that the mark had not been used in relation to games; and that its actions had not caused harm. The GC rejected the argument regarding the lack of harm caused, as this was not relevant to the assessment of bad faith. The arguments that Hasbro could have proven use and the potential swamping of the Cancellation Division were also rejected as they were irrelevant.

Hasbro also argued that the strategy of repeat filings was common and widely accepted, although the GC highlighted that this argument had not been substantiated: “the simple fact that other companies may be using a specific filing strategy does not necessarily make that strategy legal and acceptable.”

The GC upheld the Board of Appeal’s decision and ordered Hasbro to repay the costs incurred by Kreativni in the proceedings before the EUIPO.

Comment

This decision makes clear the position that attempted ‘evergreening’ of a trade mark registration in an attempt to take advantage of the grace period for non-use can result in a finding of bad faith. It establishes that a trade mark owner cannot unfairly maintain a monopoly over a certain mark for goods and services for which it has an earlier registration and in relation to which it has made no use of that mark once the grace period for non-use has expired. This makes it clear that, when filing a fresh application for a trade mark that already exists on the register owned by the applicant, careful consideration should be given to the scope of the goods and services of that new application.

Key contact

Harry Rowe
Managing associate