This Article  appeared on ABA – American Bar Association, in April 2014.
For Further information please go to http://www.americanbar.org/aba.html

In Lidl Stiftung & Co. KG v Office for Harmonisation in the Internal Market (OHIM) (Cases T – 225 -226/12, February 27, 2014), the General Court confirmed a less restrictive approach while deciding on genuine use in accordance with the combined provisions of Articles 15(1), 42 (2) and (3) when refusing registration of the Community Trademarks “LIDL EXPRESS” (stylized) and “LIDL”  stylized) in Class 15 on the grounds of Art. 8(1)(b) based on a prior registration of a Czech national trademark “LIDL MUSIC” (stylized).
At issue is whether the Czech registration and, consequently (upon request under Art. 42 (2)(3)  CTMR) the genuine use of
‘‘,

would bar Community registration of

and .

On April 9 and 14, 2008, Lidl Stiftung filed two applications for Community trademark respectively for “LIDL EXPRESS” (stylized) and “LIDL” (stylized) to distinguish “musical instruments” in Class 15. After publication, Lìdl Music Spol. S.r.o gave notice of opposition under Art 41 CTMR (then, Art

42 of Reg. 40/94) on the grounds of the earlier Czech trademark

   (No. 178 496 registered on July 26 1994 for “musical instruments).
Upon Lidl Stiftung’s request, the Czech trademark owner submitted documents to prove genuine use of the national trademark. The submitted documentation was subsequently objected to with Lidl Stiftung claiming lack of sufficiency to represent proper evidence of genuine use.

On November 12, 2010, the Opposition Division upheld the opposition for all the contested goods even though it was said that the documents submitted to prove genuine use of the Czech trademark were “not particularly exhaustive”. Notwithstanding, it was accepted that they were sufficient to prove use of the earlier national trademark for “flutes and harmonicas”.

As a result, Lidl Stiftung filed an appeal which was dismissed on March 21, 2012 by the First Board of Appeal.
In summation, all the conclusions of the Opposition Division were confirmed, in particular, likelihood of confusion as well as the extent of genuine use, within the meaning of Art 42 CTMR, stating that the use satisfied the criteria laid down in Art 10(2)(a) of Directive 2008/95/EC of the European Parliament.
On May 29, 2012, the Applicant entrusted the case to the General Court by lodging its claims at the Registry of the GC. In essence, Lidl Stiftung claimed that the Court should annul the contested decision while, in response, the OHIM contends that the Court should dismiss the action.
By its pleas, the Applicant claimed that the documents were not properly evaluated since “photos and invoices submitted were not sufficient, in themselves, to prove effective and genuine use of the earlier national mark within the meaning of Regulation No. 207/2009”.

At paragraph 25 of the decision, the General Court states that “According to settled case – law, the ratio legis of the provision requiring that the earlier mark must have been put to genuine use if it is to be capable of being used in opposition to a Community trade mark application is to restrict the number of conflicts between two marks, where there is no good commercial justification deriving from active functioning of the mark on the market (see, to that effect, Case T‑ 203/02 Sunrider v OHIM— Espadafor Caba (VITAFRUIT) [2004] ECR II‑2811, paragraphs 36 to 38, and judgment of 30 November 2009 in Case T‑353/07 Esber v OHIM […]).”

This first finding narrows the scope of the objections raised in connection with genuine use and broadens the actual chances of the owner of the Czech national trademark, Lìdt Music.
In addition, at paragraph 31 it is clearly stated that “[…] the requirement of genuine use does not seek to assess commercial success or to review the economic strategy of an undertaking, nor is it intended to restrict trade mark protection to the case where large – scale commercial use has been made of the marks (Case T ‑ 194/03 Il Ponte Finanziaria v OHIM — Marine Enterprise Projects (BAINBRIDGE) [2006] ECR II ‑ 445, paragraph 32;[…]).”
Finally at issue was the alleged “alteration of the distinctive character” by showing use of the trademark 
instead of its equivalent (as per the Czech registration).

In fact, “under Article 15(1)(a) of Regulation No 207/2009, use of the Community mark includes use in a form differing in elements which do not alter the distinctive character of the mark in the form in which it was registered”(paragraph 47).

As a result, the General Court rejected all the pleas and dismissed the action ordering Lidl Stiftung to pay the costs.
The difficulties for defendants in submitting proper proof of genuine use in the EC system are well -known and, often, considered unduly restrictive. However, these findings represent one of the few decisions leading to more relaxed standards for this kind of burden of proof.