Geographical Indications and Collective Marks - Halloumi Foundation v Babel Sajt Kft
|Fresh sliced Halloumi cheese|
Chancery Division (Mr Justice Marcus Smith) Foundation for the Protection of the Traditional Cheese of Cyprus Named Halloumi v Babel Sajt Kft.  EWHC 2858 (Ch) (30 Oct 2020)
This was an appeal by the Foundation for the Protection of the Traditional Cheese of Cyprus Named Halloumi ("the Foundation") against the decision of Ms Clare Boucher to allow the application of Babel Sajt Kft for the registration of the trade mark shown below to proceed to grant (see Re Babel Sajt Kft's Application BL O/152/20 11 March 2020). The appeal came on before Mr Justice Marcus Smith on 20 July 2020. He allowed the appeal in Foundation for the Protection of the Traditional Cheese of Cyprus Named Halloumi v Babel Sajt Kft.  EWHC 2858 (Ch) which he handed down on 30 Oct 2020.
On 7 Nob 2018m, the Hungarian company Babel Sajt Kft applied to register the following sign as a UK trade mark under number UK00003351588::
The goods for which registration was sought were milk and milk products; dairy and dairy products; cheese and cheese products in class 29.
The Foundation opposed the application under s.5 (2) and (3) of the Trade Marks Act 1994. The mark upon which it relied was the word HALLOUMI. That mark had been registered for cheese in class 29 as an EU registered collective mark under trade mark number EU001082965. The hearing officer dismissed the opposition under both subsections. Notwithstanding the similarity of the goods and the similarity of the marks she found that there was no likelihood of direct or indirect confusion for the purposes of s5 (2). Her finding under s.5 (3) was not challenged.
Grounds of Appeal
The Foundation appealed on the following grounds:
- The hearing officer erred in holding that the average consumer was a member of the public and not a cheese merchant;
- She failed to accord the Foundation's mark an appropriate degree of distinctiveness bearing in mind that it was a collective mark;
- She erred in concluding that the public would regard the mark as the name of a cheese rather than cheese supplied by the Foundation's members; and
- The hearing officer misapplied the test of distinctiveness and confusion,
At paragraph [15 (3)] of his judgment, Mr Justice Marcus Smith said that the essence of the appeal was that the hearing officer did not have proper regard for the fact that was that the opponent's mark was a collective mark. Such marks differ from other trade marks in several respects. In particular, art 74 (2) of the regulation under which the Foundation's mark was registered provided:
"By way of derogation from Article 7 (1) (c), signs or indications which may serve, in trade, to designate the geographical origin of the goods or services may constitute EU collective marks within the meaning of paragraph (1).."
In other words, signs that would normally be precluded from registration for lack of distinctiveness may be registered as collective marks.
"Article 66 (2) of Regulation No 207/2009 is not an exception to that requirement of distinctiveness. While that provision permits, by way of derogation from Article 7 (1) (c) of that Regulation, registration as EU collective marks of signs which may serve to designate the geographical origin of goods or services, it does not, on the other hand, allow the signs thus registered to be devoid of distinctiveness. Where an association applies for a registration, as an EU collective mark, of a sign which may designate a geographical origin, it is therefore incumbent on it to ensure that that sign has elements which enable the consumer to distinguish the goods or services of its members from those of other undertakings."
The representation made by the mark was that users of the HALLOUMI mark must be members of the Foundation.
"I have already found that the Hearing Officer was correct to conclude that EU collective marks like the Foundation's Mark fall to be considered like any other EUTM. However, I have also concluded that the very nature of an EU collective mark – as the mark of an association, rather than a single undertaking – requires particular consideration. That is not because of any difference in the law: it is because of the intrinsic difference between EU collective marks and other EUTMs, which requires particular consideration when seeking to determine how similar an EU collective mark is when compared with an (earlier or later) EUTM (whether that EUTM is collective or not)."
The hearing officer's mistake had been "to regard the Foundation's Mark as a part of the Applicant's Mark, such that the distinguishing features of the Foundation's Mark were subsumed into the Applicant's Mark." That distinguishing feature was the representation that users of the Foundation's Mark were members of the Foundation. The applicant's mark did not say simply that it was a supplier of cheese. It represented that its goods were supplied by a member of the Foundation. That was the consideration that the hearing officer should have borne in mind when considering the similarity of the Foundation's mark and the applicant's.
It was submitted that that error might have been avoided had the hearing officer accepted the Foundation's submission that the average consumer was a trader in cheese rather than "a member of the general public, who would select the goods themselves from the supermarket shelves or on-line from a website." Such a trader might be expected to know about the Foundation's registration and spotted the misrepresentation. The judge rejected that contention. Nothing in the hearing officer's decision precluded the possibility of a trader being an average consumer. However, he did accept that
"she failed to take any or (at least) any proper account of the fact that the Foundation's Mark was a collective mark in her assessment of the identity of the average consumer. As is clear from the evidence adduced by the Foundation, a trade consumer (like a supermarket) would be aware of the difference between an EU collective mark (as designating the product of an association of producers, governed by the specific rules of that association) and an EUTM (designating a single undertaking as the origin of the product)."
"(1) The Hearing Officer found, and I accept, that there is a high degree of similarity or identity as between the goods in respect of which the Foundation's Mark is registered (i.e., Cheese) and the goods in respect of which the Applicant's Mark is registered (i.e., Milk and milk products; dairy and dairy products; cheese and cheese products). It is unnecessary to repeat the Decision, nor my summary of it in paragraphs 8ff above.
(2) The "average consumer", a class or classes of person that needs to be identified in order to ascertain whether there exists a likelihood of confusion on the part of the public within section 5 (2) (b), comprises:
(a) The ultimate consumers of the Foundation's and the Applicant's products, that is the members of the general public who would select these products from supermarket shelves (or other shops) and purchase them (Consumers).
(b) The trade purchasers of the Foundation's and the Applicant's products, that is the supermarkets (and other shops) who would purchase these products for on-sale to Consumers (Trade Purchasers).
I consider that each of these classes, separately, comprises a group capable of amounting to the "average consumer". I consider (if that consideration is relevant), the latter class to be more significant.
(3) I do not consider that Consumers would be alive to the significance of the fact that the Foundation's Mark was a collective mark, designating as the producer of the goods sold under that mark a member of the Foundation, producing halloumi according to the rules of the Foundation. Whilst I cannot properly treat "HALLOUMI" as an entirely generic term, it does seem to me that the term can either designate:
(a) Cheese produced by a member of the Foundation; or
(b) A sort of cheese having the characteristics of cheese produced by a member of the Foundation, without necessarily any other appreciation of the origins of the product.
I consider that Consumers would generally understand the term in the latter sense, and would regard the use of the word "HALLOUMI" in the Applicant's Mark as referring to a type of cheese and not to cheese made by any specific group of producers. I am aided in reaching that conclusion by the fact that there is no added figurative detail to the Foundation's Mark to render it distinctive. Whilst, again, I must accept that the Foundation's Mark is distinctive, when the Foundation's Mark is subsumed into the Applicant's Mark, I do not consider that a Consumer would view the Applicant's Mark in that light. The Consumer would not consider the Applicant's Mark to be an amalgam of (i) the mark of the undertaking producing the cheese (i.e., "Hajdu") and (ii) the Mark of the Foundation. Rather, I consider the Consumer would view the mark as describing the undertaking – Hajdu – as producing a particular form of cheese known as halloumi. In short, I do not consider that a Consumer would be confused by the Applicant's Mark into considering that the producer of the cheese was a member of the Foundation. That is, essentially, because I do not consider that the Consumer would – considering the Applicant's Mark as a whole – regard it as in any way referring to or designating origin from a member of the Foundation.
(4) Matters are, I consider, very different in the case of Trade Purchasers. A Trade Purchaser would be very conscious of the significance of an EU collective mark, and would appreciate that, whilst halloumi might designate a type of cheese in purely abstract terms, it was also, and more importantly, the Foundation's Mark, designating the origin of the product as stemming from a member of the Foundation. Trade Purchasers attach an entirely understandable importance in the origin of the goods that they on-sell to Consumers. I consider that a Trade Purchaser would regard the word "HALLOUMI" – without any figurative or other embellishment – as primarily a mark of origin. A Trade Purchaser would regard the incorporation of the word "HALLOUMI" into a larger mark as precisely the sort of differentiation as was described in paragraph 43 above. In short, a Trade Purchaser would consider the Applicant's Mark to be an amalgam of (i) the Foundation's Mark (a badge designating origin of the product as being from a member of the Foundation) and (ii) the mark of the individual foundation member. On this basis, the Applicant's Mark was conveying an origin as follows: "This halloumi is made by Hajdu, a member of the Foundation".
(5) I consider, for that reason, that there is a very strong likelihood that a Trade Producer would consider that there was a high degree of similarity between the Foundation's Mark and the Applicant's Mark, in that the latter was incorporating and using the Foundation's Mark as a badge of producer origin (viz, a member of the Foundation), and then further specifying the producer as being a specific member of the Foundation, viz Hajdu. That, of course, would not be right: Hajdu is not in any way associated with the Foundation.
For these reasons, I consider there to be a very strong likelihood of confusion on the part of a Trade Purchaser in associating the Applicant's Mark with that of the Foundation's Mark."