The applicant applied to the Office for Harmonisation in the Internal Market (‘OHIM) for a Community Trade Mark (‘CTM’) for the mark ‘TDK’ in respect of clothing, footwear and headgear. The intervener opposed the application on the grounds of the existence of an earlier Community Trade Mark as well as 35 earlier national trade marks which were registered in respect of class 9 (apparatus for recording transmission or reproduction of sound or images).

The earlier marks were a combination of the word mark TDK or the word and a figurative mark. OHIM upheld the opposition on the basis of art 8(5) of Council Regulation (EC) 40/94 and refused the CTM application. The applicant appealed and the Board of Appeal of OHIM, dismissed the appeal.

The applicant then applied to the Court of First Instance for the annulment of this decision. The Court of First Instance had to consider whether the earlier marks had enjoyed a reputation and whether the use of the mark in question would take unfair advantage of the distinctive character or the reputation of the earlier marks.

The court held:

§             ‘…Whilst art 8(5) of the regulation did not define ‘reputation’, in order to satisfy the requirement of reputation, the earlier national mark had to be known to a significant part of the public concerned by the goods or services covered by that trade mark. In examining that condition, it was necessary to take into consideration all the relevant facts of the case, in particular:-

o       the market share held by the mark

o       the intensity

o       the geographical extent and duration of its use; and

o       the size of the investment made by the undertaking promoting it.

§             The …decision had correctly set out the criteria for the purposes of assessing reputation within the meaning of art 8(5) of the regulation and the Board had not committed any error in assessing evidence put forward by the intervener for the purposes of establishing the reputation of the earlier marks.

§             Having regard to all that material, the …decision had to be upheld in respect of its finding of reputation. The intervener had established the nature, duration and scope of its commercial activities as regards the production, marketing, sponsorship and advertising of the earlier marks in question. The evidence supported the Board’s finding that the earlier marks satisfied the criteria laid down in the case-law in respect of reputation, namely, that they were known by a substantial part of the public. General Motors [1999] ECR I-5421 considered.

§             The Board of Appeal was not required to establish actual and present harm to an earlier mark, but rather it had simply to have available to it prima facie evidence of a future risk…

§             The concept of taking unfair advantage of the distinctive character of the reputation of the earlier mark had to be understood as encompassing instances where there was clear exploitation and free-riding on the coat-tails of a famous mark or an attempt to trade upon its reputation. The stronger the earlier mark’s distinctive character and reputation, the easier it would be to accept that detriment had been caused to it.

§             In the instant case, the intervener had established the reputation of its earlier marks, which had an enhanced distinctive character by reason of the reputation attached to them.

§             In the circumstances, the Board had been entitled to take the view on the evidence that were the mark applied for to be used by the applicant on sporting clothing (a possibility that could not be ruled out), such use would lead to the perception that clothing was manufactured by, or under licence from, the intervener.

§             That in itself was sufficient to constitute prima facie evidence of future risk, which was not hypothetical, of the taking of unfair advantage by the applicant of the reputation of the earlier marks.’