European Union: SPINNING Out Of Control?

Last Updated: 15 November 2018
Article by Oliver Gray and Clare Mann

Gym-goers in the United Kingdom have become well acquainted with "spinning" classes in recent years, and most consumers will be familiar with the concept of a group of fitness fanatics pedalling away to a heavy beat on exercise bikes, under the watchful oversight of an instructor. However, the owner of the registered trade mark SPINNING will have been working up a sweat over more than just strenuous exercise in the run up to the General Court's judgement on 8 November 2018 regarding the validity of that trade mark registration.

Since 3 April 2000, SPINNING has been registered as an EU trade mark in respect of exercise equipment in Class 28 and exercise training in Class 41 in the name of Mad Dogg Athletics, Inc. From a UK perspective, this is somewhat surprising, because a sign is not eligible for registration as a trade mark to the extent that it is customary in the current language or in the bona fide and established practices of the trade (section 3(1)(d) Trade Marks Act 1994/Article 7(1)(d) EUTMR). However, as "spinning" classes are a relatively modern cultural phenomenon, it is likely that the mark SPINNING would not have stood out as being customary in the language of the trade in April 1996, when the EU trade mark application was filed.

Just as a sign which is customary in the language of the trade cannot be registered, a registered EU trade mark can be revoked if, following registration, the trade mark has become the common name in the trade for a product or service in respect of which it is registered, on account of the acts or inactivity of the trade mark owner (section 46(1)(c) Trade Marks Act 1994/Article 58(1)(c) EUTMR). Given how common "spinning" classes are today, it is perhaps not surprising that Mad Dogg Athletics' registration for SPINNING was attacked on these grounds by Aerospinning Master Franchising s.r.o. By way of background information, Aerospinning's decision to apply for the revocation of Mad Dogg Athletics' EUTM registration was in response to trade mark infringement proceedings brought by Mad Dogg Athletics against Aerospinning in the Czech Republic.

In the initial revocation proceedings before the EUIPO's Cancellation Division, Aerospinning submitted evidence that the mark SPINNING had become the common name in the trade in respect of exercise equipment in Class 28 and exercise training in Class 41 in the Czech Republic. As part of these proceedings, the parties disputed who the relevant public was for determining whether a mark had become a common name. Mad Dogg Athletics argued that the relevant public was made up of specialist consumers with a high level of knowledge of the exercise equipment industry. The significance of this is that specialist consumers will pay more attention when purchasing goods and services, and they will be more readily able to recognise where a mark is functioning as an indication of commercial origin, rather than simply describing the goods and services in question. That is to say, if the relevant public were specialists, Mad Dogg Athletics would be more easily able to argue that their mark SPINNING was validly registered as an EU trade mark. Aerospinning disputed this interpretation of the relevant public. For them, the relevant public were general gym-goers and end-users of the exercise bikes, who would not recognise the word SPINNING as an indication of commercial origin, but rather as a description of the exercise equipment and exercise training services in question.

The EUIPO's Cancellation Division agreed with Aerospinning. The relevant public was the end-user of the exercise equipment in the Czech Republic, who would not be aware that SPINNING is intended to function as an indication of commercial origin. The Cancellation Division revoked the trade mark registration.

The Cancellation Division's decision was upheld by the Board of Appeal, which concurred with the Cancellation Division's assessment of the average consumer. However, relief came for Mad Dogg Athletics on second appeal to the General Court. In response to a question from the Court, Mad Dogg Athletics disclosed that its exercise bikes were primarily sold to the commercial operators of gyms, sports facilities, and rehabilitation facilities, i.e. to specialist consumers. Indeed, 95% of the registrant's sales were to such customers. In light of this information, the Court held that "...those operators play a central role on the 'exercise equipment' market and... they have a decisive influence on the selection, by end users, of 'exercise training' services. Through their knowledge of the contested mark's function as an indication of origin, those operators thus enable the process of communication between providers and end users of those services to be successfully carried out..." On this basis, the General Court overturned the revocation of the mark in relation to exercise equipment and exercise training.

The General Court's decision comes as something of a surprise to the writer. Firstly, the decision goes against the general thrust of EU case law, in which the Court tends to hold that where the relevant public comprises both lay consumers and specialist consumers, it will generally be the perception of the least sophisticated consumers which is paramount in establishing whether a mark has become customary in the language and practice of the trade. The Court has also left a hole in its reasoning. After establishing that the relevant consumers are specialists, the Court proceeded to conclude that those specialists would know that the mark SPINNING functions as an indicator of origin. It is not clear what led the Court to that conclusion. Nevertheless, the decision shows how significant it can be in trade mark proceedings to show that the consumers of goods or services are sophisticated and specialist. It would appear that, in the General Court's view, this alone can be sufficient to save a registered mark which, at least to the average UK consumer, is likely to be seen as wholly descriptive of the goods and services in respect of which it is registered. Perhaps Aerospinning should have considered filing evidence to demonstrate that the mark SPINNING had become common in the trade in more EU countries than just the Czech Republic.

Aside from the Court's assessment of the relevant public, there is an implicit 'health warning' in these proceedings for all holders of EU trade marks, namely that where a registered EU trade mark has become customary in the language of the trade in one member state, this will be sufficient for a third party to seek revocation of the entire EU trade mark. Whilst it would be possible for the trade mark holder to convert its EU trade mark into a series of individual national rights in those member states where the ground for revocation did not apply, this would be a costly and time-consuming process for the trade mark holder.

It remains to be seen whether the General Court's decision is appealed to the Court of Justice. Gyms throughout the EU which refer to their indoor cycling classes as SPINNING classes, but do not have authorisation from Mad Dogg Athletics to do so, will be hoping that it is.

SPINNING Out Of Control?

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