TESLA FIGHT FAILS
TO LAUNCH

But there may be fuel for a bad faith cancellation, suggests Julia King

KEY POINTS

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Brand owners should file trade mark applications for new brands prior to launch

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The threshold for an Article 8(4) claim is to prove significant commercialised use of the sign in the relevant territories, prior to the applicant’s filing date

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Bad faith cancellation actions may prove more successful in dealing with seemingly vexatious third parties

MARK

In this case, Tesla, Inc (Tesla), opposed an application for GIGABIER filed by Juicyphant GmbH (Juicyphant) in classes 29, 30 and 40, based on Tesla’s earlier unregistered rights in an identical sign in Denmark and Ireland. The case is significant as it demonstrates the importance of applying to register a trade mark prior to brand launch and that, if this is not done, brand owners may struggle to adequately prove the existence of their unregistered rights and prevent third parties from adopting the same name.

Tesla’s case in opposition to Juicyphant’s rested on its earlier rights in the unregistered sign GIGABIER in Denmark and Ireland in respect of beers. It claimed that it had used GIGABIER in the course of trade, in a manner of more than mere local significance and in connection with beers, prior to Juicyphant’s filing date, and that it had the right to prohibit the use of this third-party trade mark under Article 8(4) of the EU Trade Mark Regulation (EUTMR).

The EUIPO prefaced its decision by noting that the availability of Article 8(4) EUTMR is “reserved for signs with a real and actual presence on their relevant market”. The evidence submitted by an opponent in support of this ground must be dated before the filing date of the application and must show commercial significance in a substantial part of the relevant territory. The Office will consider, in particular, the duration and intensity of use of the unregistered sign in respect of consumers, as well as the advertising spend and evidence of attempts to agree commercial partnerships and supplier contracts.

Tesla’s first bundle of evidence included:

• articles on Tesla’s launch of a car manufacturing plant under the name GIGA FACTORY;
• articles on Tesla CEO Elon Musk’s speech at the opening of the Giga Factory, where he launched GIGABIER, including a slideshow with a concept image of a branded bottle of GIGABIER;
• screenshots from YouTube and other social media pages showcasing the speech and the GIGABIER concept images from the Giga Factory inauguration; and
• screenshots to prove that six Danish individuals had won tickets to and attended the Giga Factory inauguration.

Tesla also filed additional evidence, which the EUIPO at its discretion admitted into proceedings. These materials all appeared to postdate Juicyphant’s application and included:

• screenshots from a website for gigabier.tesla.com and social media posts from various Danish and Irish people claiming to have bought a Tesla GIGABIER;
• articles on the launch of GIGABIER in Denmark;
• screenshots from a Danish second-hand marketplace, selling GIGABIER goods; and
• social media posts regarding Irish attendees at the Giga Factory launch event.

Of key importance in the EUIPO’s assessment of the existence of Tesla’s earlier unregistered rights is the relevant date. This is because Juicyphant’s application was filed one day after Mr Musk’s speech at the opening of the Giga Factory. Could Tesla really be said to have acquired unregistered rights in GIGABIER after one day of promotional activity?

In short, the answer is no. In reaching its conclusion that Tesla had not proven unregistered rights in GIGABIER, the Office placed particular weight on the fact that no invoices, price lists, sales figures or advertising spend had been filed, and that Tesla could not provide any hard evidence on the degree of recognition or intensity of use of GIGABIER by the public at the relevant point in time.

“Brand owners should clear and file trade mark applications for new brands prior to their launch”

The evidence related to Mr Musk’s inaugural speech at the Giga Factory did not prove that there had been any use in the course of trade at the relevant date. The Office took the view that Mr Musk’s speech was merely an indication that Tesla intended to produce GIGABIER branded beer “at some point in the future”.

Social media commentary on the day of the speech, however widely viewed it may have been, could not “equate to a real and actual presence on the relevant market of the sign in question”. What mattered was showing that the use of the sign in the course of trade was of more than mere local significance, not that the publicity for the brand had been widely viewed or shared online on that day.

From the evidence adduced by Tesla, the EUIPO drew the conclusion that there had been “use of the earlier sign prior to the relevant date [in the] opponent’s brief announcement at an event in Germany, attended by a maximum of 9,000 people, that a beer may possibly be launched in the future under that brand”. This evidence did not show that the use was in the course of trade, nor that it attracted the attention of a substantial part of the relevant public in Ireland and/or Denmark. That conclusion was not altered by the fact that some Danish and Irish individuals allegedly attended the Giga Factory launch event. Evidence that post-dated Juicyphant’s filing date was swiftly dismissed.

As Tesla could not prove the use of GIGABIER in the course of trade, in a manner of more than mere local significance, at the relevant date, the EUIPO rejected the opposition in its entirety and ordered Tesla to pay a small cost award. It is not yet known whether Tesla will appeal this decision, but it is difficult to foresee an appeal being successful unless Tesla can adduce more evidence to show intensive commercial use of GIGABIER prior to Juicyphant’s filing date.

One suspects Tesla may have more luck in cancelling this GIGABIER trade mark based on bad faith, particularly given that the company also previously applied to register various TESLAQUILA trade marks following Tesla’s announcements at that brand launch.

What have we learned from this case? The key point is that brand owners should clear and file trade mark applications for new brands prior to their launch. It is difficult to prove unregistered rights in a sign under Article 8(4) when dealing with arguably vexatious filings from third parties that seem to be trying to pip brand owners to the trade mark filing post.

Julia King is a Chartered Trade Mark Attorney and Associate at Taylor Wessing LLP
ju.king@taylorwessing.com

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