YOGAJEANS | Decision 0012606

Date Published: Oct 1, 2017

CANCELLATION No 12 606 C (INVALIDITY)

Eric Wazana, 1625 Chabanel O suite 115, Montreal, Quebec H4N 2S7, Canada (applicant), represented by IPSO, 5, rue Murillo, 75008 Paris, France (professional representative)

a g a i n s t

ISKO S.r.l., Viale Papa Giovanni XXIII n. 48, 24121 Bergamo, Italy (EUTM proprietor), represented by Alessandra Vitagliano, Via Larga 16, 20122 Milan, Italy (professional representative).

On 07/06/2017, the Cancellation Division takes the following

DECISION

1.        The application for a declaration of invalidity is upheld.

2.        European Union trade mark No 13 290 721 is declared invalid in its entirety.

3.        The European Union trade mark proprietor bears the costs, fixed at EUR 1 150.

REASONS

The applicant filed an application for a declaration of invalidity against EUTM No 13 290 721 ‘YOGAJEANS’ (word mark) (the EUTM). The request is directed against all the goods and services covered by the EUTM, namely:

Class 24: Textiles and textile goods, not included in other classes; Labels; Flannel [fabric]; Jersey [fabric]; Filtering materials of textile; Plastic material [substitute for fabrics]; Fabrics; Printers’ blankets of textile; Furniture coverings of textile; Lining fabric for shoes; Hemp fabric; Adhesive fabric for application by heat; Elastic woven material; Fabric of imitation animal skins; Fabric for footwear; Traced cloths for embroidery; Knitted fabric; Non-woven textile fabrics; Textile fabrics for the manufacture of clothing; Printed textile labels; Textile used as lining for clothing; Adhesive materials in the form of stickers [textile]; Breathable waterproof fabrics; Chemical fibre mixed fabrics; Coated fabrics for use in the manufacture of leather goods; Coated fabrics for use in the manufacture of luggage; Coated fabrics for use in the manufacture of rainwear; Composite textile materials; Denim fabric; Elastic woven material; Fabric for manufacturing men’s outerwear; Fabric for manufacturing women’s outerwear; Fabric for use in the manufacture of bags; Fabric for use in the manufacture of wallets; Fabric linings for clothing; Fabric on the roll; Fabric on the roll; Textile napkins; Fabrics being textile piece goods for use in embroidery; Fabrics being textile piece goods for use in manufacture; Fabrics being textile piece goods for use in patchwork; Fabrics being textile piece goods made of mixtures of fibres; Fabrics covered with motifs to be embroidered; Soft furnishings; Fabrics for industrial use; Interior decoration fabrics; Fabrics for shirts; Fabrics for shirts; Fabrics for the manufacture of furnishings; Fabrics for use as linings in clothing; Fabrics for use in covering armchairs; Fabrics for use in making jerseys; Fabrics for use in the manufacture of exterior coverings for chairs; Fabrics made from artificial fibres [other than for insulation]; Fabrics woven from ceramic fibres, other than for insulation; Fabrics made from cotton, other than for insulation; Fabrics made from linen, other than for insulation; Fabrics made from natural fibres, other than for insulation; Fabrics made from nylon, other than for insulation; Fabrics made from polyester, other than for insulation; Fabrics made from synthetic threads; Fabrics made from wool, other than for insulation; Fabrics made of mixed synthetic and natural fibres, other than for insulation; Fabrics of chemically produced fibres, other than for insulation; Fabrics of man-made fibres being textile goods in piece form; Fabrics of organic fibres, other than for insulation; Fibre fabrics for use in the manufacture of articles of clothing; Fibre fabrics for use in the manufacture of linings of bags; Fibre fabrics for use in the manufacture of linings of shoes; Flocked fabrics; Honeycomb materials [textiles]; Industrial fabrics; Iron-on cloth labels; Knitted elastic fabrics for sportswear; Materials for use in making clothes; Muslin; Non-woven fabrics of synthetic fibres; Printed textile piece goods; Printed textile piece goods; Resin impregnated textile fabrics; Self-adhesive cloth labels; Sofa covers; Suiting materials [textile]; Suiting materials [textile]; Tartan piece goods; Textile fabric piece goods for use in the manufacture of clothing; Textile piece goods (Polyurethane coated -) for making waterproof clothing; Textile fabric piece goods for use in the manufacture of clothing; Textile fabric piece goods for use in the manufacture of clothing; Textile piece goods for use in the manufacture of shoes; Textile piece goods made of cotton; Textiles impervious to water but permeable to moisture; Textiles made of cotton; Textiles made of satin; Textiles made of synthetic materials; Textiles made of velvet; Vinyl cloth; Viscose textiles; Waterproof fabrics for use in the manufacture of jackets; Waterproof fabrics for use in the manufacture of trousers; Woven fabrics for making up into articles of clothing; Woven fabrics imitating leather; Textile fabrics in the piece; Tissues being textile piece goods; Chemical fiber fabrics; Cotton base mixed fabrics; Elastic fabrics for clothing; Elastic yarn mixed fabrics; Hemp base mixed fabrics; Hemp yarn fabrics; Hemp-cotton mixed fabrics; Hemp-silk mixed fabrics; Hemp-wool mixed fabrics; Jersey [fabric]; Knitted fabrics of chemical-fiber yarn; Knitted fabrics of cotton yarn; Mixed fiber fabrics; Narrow woven fabrics; Silk-cotton mixed fabrics; Silk-wool mixed fabrics; Fabrics made from synthetic threads; Waterproof textile fabrics; Waterproof textile fabrics; Waterproof textile fabrics; Apparel fabrics; Lining fabric for shoes; Cotton fabrics; Cotton fabrics; Textiles made of linen; Flax fabrics; Linens; Woollen fabric; Woollen fabric; Fabrics; Textile fabrics in the piece; Fabrics; Fabrics; Hemp fabric; Velvet; Fabrics; Textile fabrics in the piece; Textile fabrics for use in the manufacture of sportswear; Textile fabric piece goods for use in the manufacture of clothing; Reinforced fabrics [textile]; Textiles treated with a flame resistant finish; Regenerated fiber yarn fabrics; Semi-synthetic fiber fabrics; Rubberized textile fabrics; Fabrics; Canvas; Hemp fabric; Rayon fabric; Textile piece goods for use in the manufacture of protective clothing; Inorganic fibre mixed fabrics; Waterproofed textile piece goods; Textile goods for making headshawls and yashmaghs; Flannel [fabric]; Textiles made of flannel; Knitted fabric; adhesive labels (textile- ); Labels of textile for identifying clothing; Labels (Textile -) for marking clothing; Materials (Textile -) for use in the manufacture of linings for footwear.

Class 25: Shirt yokes.

Class 35: Advertising; Office functions; Bill sticking; Rental of advertising time on communication media; Commercial information agencies; Advertising agencies; Import-export agency services; Updating of advertising material; Administration of foreign business affairs; Market research; Commercial or industrial management assistance; Commercial or industrial management assistance; Business assistance relating to business image; Business assistance relating to corporate identity; Marketing assistance; Auditioning of performing artists [selection of personnel]; Conducting of marketing studies; Business consulting services; Business consultancy to firms; Advice relating to marketing management; Advisory services relating to sales promotion; Advising commercial enterprises in the conduct of their business; Consultancy relating to advertising; Consultations relating to business advertising; Consultations relating to business advertising; Business consultancy services relating to marketing; Business consultancy services relating to marketing; Business advice relating to marketing management consultations; Business advice relating to strategic marketing; Consultations relating to business promotion; Professional consultancy relating to marketing; Business consulting services; Advice in the field of business management and marketing; Business management consultancy; Personnel management consultancy; Business auditing; Writing of publicity texts; Dissemination of advertisements; Distribution of samples; Business management of performing artists; Direct mail advertising; Compilation of statistics; Invoicing; Business consultancy services relating to marketing; Provision of information relating to marketing; Provision of marketing advisory services for manufacturers; Computerised file management; Personnel management of marketing personnel; Management of business projects [for others]; Provision of information relating to marketing; Business information; Consumers (Commercial information and advice for -) [consumer advice shop]; Services for provision of foreign trade information; Services for provision of foreign trade information; Collecting information for business; Information or enquiries on business and marketing; Interpretation of market research data; Investigations of marketing strategy; Layout services for advertising purposes; Rental of advertising space; Marketing services; Business consultancy services relating to marketing; Financial marketing; Product marketing; Promotional marketing; Trade marketing [other than selling]; Preparation of advertising material; Exhibitions for commercial or advertising purposes; Organisation of trade fairs for advertising purposes; Arranging of displays for commercial purposes; Arranging of demonstrations for advertising purposes; Arranging of displays for advertising purposes; Arranging of exhibitions for business purposes; Preparation of advertising material; Provision of marketing reports; Marketing forecasting; Economic forecasting; Production of advertising material; Economic forecasting; Production of advertising films; Assistance in management of business activities; Sales promotion for others; Consultancy relating to advertising; Advertising and marketing; Business inquiries; Production of video recordings for advertising purposes; Preparing business reports; Public relations services; Sponsorship search; Business research; Market research and marketing studies; Market research; Business management and organization consultancy; Consultancy relating to business organisation; Consultancy relating to business organisation; Advisory services relating to business planning; Advisory services relating to corporate identity; Advisory services relating to sales promotion; Business advisory services relating to product development; News clipping services; Brand creation services; Brand positioning services; Brand consultancy services; Brand consultancy services; Brand positioning services; Brand creation services; Brand creation services (advertising and promotion); Advertising and marketing; Advertising, marketing and promotional services; Corporate identity services; Business consultancy services relating to manufacturing; Business strategy services; Information services relating to advertising; Marketing agency services; Planning services for marketing studies; Research services relating to marketing; Business consultancy services relating to marketing; Business consultancy services relating to marketing; Business marketing services; Marketing services; Direct marketing; Conducting of marketing studies; Market research; Market studies; Business appraisals; Arrangement of advertising; Business appraisals.

Class 40: Abrasion; Pneumatic abrasion of surfaces; Air deodorising; Knitting machine rental; Application of appliques to textiles; Applying finishes to textiles; Application of motifs to textiles; Application of relief patterns to board surfaces; Application of wear resistant coatings by autocatalytic processes; Application of wear resistant coatings by electrolytic processes; Application of wear resistant coatings to engineering components; Application of protective coatings to leather; Monogramming of clothes; Applying finishes to textiles; Applying finishes to textiles; Custom assembling of materials for others; Wool (Permanent press treatment of -); Permanent-press treatment of fabrics; Permanent press treatment of clothing; Fabric bleaching; Staining; Tanning; Water pollution control; Catalytic conversion of chemical compounds; Custom construction of machines; Fabric bleaching; Fabric bleaching; Demineralisation of water; Water purification; Purification of industrial waste water; Solvent purification; Photographic image processing; Photographic slide and print processing; Extraction of elements contained in waste residues; Custom assembling of materials for others; Filtration of liquids; Filtration services; Textile finishing; Applying finishes to textiles; Fulling of cloth; Material treatment information; Photogravure; Photographic etching of articles of clothing; Photographic etching of printed matter; Photographic etching of textiles; Metal coating; Waste management services [recycling]; Flame proofing; Wool (Fireproofing of -); Textile fireproofing; Fireproofing of clothing; Textile fireproofing; Fireproofing [for textile or furs]; Fabric waterproofing; Waterproofing of clothing; Fabric waterproofing; Waterproofing [for textile or furs]; Engraving; Cloth edging; Laminating of textiles; Leather working; Burnishing by abrasion; Surfacing of textiles; Rental of sewing machines; Rental of printing machines and apparatus; Rental of shoe making machines; Warping [looms]; Cloth edging; Cloth edging; Cadmium plating; Surface plating; Polymerization; Cloth pre-shrinking; Preparation and treatment of fabric; Wool (Pre-shrinking of -); Shoemaking; Making up of soft furnishings; Shrink-proofing [for textile or furs]; Shrinking of items of clothing; Cloth pre-shrinking; Cloth pre-shrinking; Embroidery; Embroidery; Refinishing of acrylic fixtures; Regeneration of water; Waste water treatment; Electroplating; Pre-shrinking of items of clothing; Fabric bleaching; Fabric bleaching; Advisory services relating to dyeing; On-site water purification services; Print finishing services; Galvanization services; Laser scribing services; Sandblasting services; Dyeing services; Dyeing [for textile or furs]; Cloth dyeing; Quilting; Brushing of textiles; Printing; Discharge printing; Wool printing; Pattern printing; Pattern printing on fabric; Photogravure printing; Printing of advertising matter; Pattern printing on fabric; T-shirt printing; Lithographic printing; Offset printing; Custom imprinting of clothing with decorative designs; Textile printing; Clothing (hot-pressing of -) [forming of clothing]; Clothing (hot-pressing of -) [forming of clothing]; Moulding of textiles; Cloth cutting; Cloth cutting; Weaving; Dyeing; Staining of leather; Wool dyeing; Shoe staining; Dyeing of clothing; Fur dyeing; Cloth dyeing; Dyeing of non-woven textiles; Cloth dyeing; Cloth dyeing; Dyeing of cloth or clothing; Cloth dyeing; Carpet dyeing; Crease-retaining treatment; Mold prevention treatment of cloth; Mold prevention treatment of cloth; Mothproofing services; Crease-resistant treatment for clothing; Textile mothproofing; Mothproofing of clothing; Textile mothproofing; Textile mothproofing; Chemical treatment of textile; Blast treatment; Water treatment; Wool treating; Waste water treatment; Applying finishes to textiles; Applying finishes to textiles; Applying finishes to textiles; Applying finishes to textiles; Textile treatment in the nature of waterproofing; Treatment of fabrics to impart antistatic properties; Treatment of fabrics to impart stain repellent properties; Crease-resistant treatment for clothing.

The applicant invoked Article 52(1)(b) EUTMR.

SUMMARY OF THE PARTIES’ ARGUMENTS

The applicant first argues that the EUTM proprietor was acting in bad faith when it filed the application. The applicant is the proprietor of the trade mark ‘YOGA JEANS’ and manager of the company SECOND DENIM CO., created in 2000 to manufacture women’s denim. The company has a division called ‘Wazana Clothing Inc.’, which uses the mark ‘YOGA JEANS’ around the world. The ‘YOGA JEANS’ line was launched in 2005 in Canada and the trade mark was granted protection in Canada and in the USA and subsequently in Japan and at the European Union level. Since 2005, the brand has become famous around the world and in particular in Canada, the USA, Japan and Europe, and generates 60% of the sales of SECOND DENIM CO. The goods have been sold in Europe since at least 2010, in particular in France, the United Kingdom and the Netherlands.

The applicant points out that ISKO S.r.l., the proprietor of the contested EUTM, is the Italian branch of ISKO, based in Turkey, part of the SANKO group, a professional textile producer and the world’s largest producer of denim fabric.

The applicant and ISKO have had a professional relationship since October 2011, with ISKO supplying the applicant with denim fabric for 2011 and 2012 at least; therefore, ISKO was aware of the existence of the mark ‘YOGA JEANS’. ISKO applied for two EUTMs, ‘YOGAJEANS’ (the contested trade mark in the present case) and ‘ISKO YOGAJEANS’ (also contested in parallel proceedings) and used its trade mark ‘YOGAJEANS’ internationally, designating the USA, Japan and China, namely the exact countries where the applicant had registered its trade mark previously. The contested registration ‘YOGAJEANS’ is ‘clearly an alternative strategy to monopolize ‘YOGAJEANS’ as a mark’. The relevant point in time is the date of filing of the contested sign.

The first factor to take into consideration in a bad faith case is the identity or similarity of the signs, which in the present case is fulfilled, as the earlier mark, ‘YOGA JEANS’, is almost identical to the contested sign, ‘YOGAJEANS’. The signs in conflict have even been found identical in opposition proceedings B 2 468 232 of 01/10/2015 (see exhibit 11).

The second factor to be considered is the EUTM proprietor’s knowledge of the use of the earlier sign. In the present case, the EUTM proprietor is a supplier in the denim industry and the applicant is a manufacturer of denim jeans. Taking into account the great success of the ‘YOGA JEANS’ mark, created in the period 2005-2007 and used in Europe at least since 2010, the EUTM proprietor could not ignore this earlier trade mark. In addition, the two companies have been doing business together since 06/10/2011 and have exchanged emails for at least 10 months.

The third factor to be taken into account when establishing bad faith is the dishonest intention on the part of the EUTM proprietor. The existence of a direct relationship between the parties is a high indicator of bad faith. Nevertheless, as regards the applicant’s argument that the EUTM proprietor applied for the trade mark ‘YOGAJEANS’ in the same countries as the applicant (the USA, Japan and China, as well as in the EU), this is not sufficient to establish bad faith because the markets in question are the biggest markets in the world and the fact that an undertaking wishes to protect its trade mark in the world’s biggest markets is a normal business practice. By contrast, the fact that in a few years the trade mark ‘YOGA JEANS’ has acquired a reputation is a relevant factor, because it is clear that the intention of the EUTM proprietor was to present itself as being related to the ‘YOGA JEANS’ line of clothing. In doing so, it seeks to take advantage of the prestige of the ‘YOGA JEANS’ line of clothing and to benefit from the investments already made by the applicant, especially its presence on social media, as shown in Exhibit 7 (celebrities wearing jeans bearing the mark ‘YOGA JEANS’ on Facebook pages). Considering also that the jeans market is highly competitive and that both parties are involved in the textile and jeans business, as demonstrated by Exhibits 1 and 14 and the email exchange in Exhibit 15, it is considered that bad faith is established.

When bad faith is established, the whole EUTM is declared invalid, even for goods and services that are unrelated to those protected by the invalidity applicant’s mark.

In support of its observations, the applicant submitted the following evidence:

  • Exhibit 1: extract from the Canadian IP Office for the trade mark ‘YOGA JEANS’, which was filed on 29/01/2008 and registered on 22/06/2010 for different clothing articles and other goods and services in the name of Eric Wazana.
  • Exhibit 2: extract from USPTO for the trade mark ‘YOGA JEANS’, which was filed on 13/05/2012 and registered on 21/10/2014 for different clothing articles in the name of Eric Wazana.
  • Exhibit 3: information from eSearch about EUTM No 8 862 088 ‘YOGA JEANS’, which was filed on 05/02/2010 and registered on 27/07/2010 in Classes 18 and 25.
  • Exhibit 4: Extract from a Japanese trade mark database showing the trade mark ‘YOGA JEANS’ No 5 616 501 registered on 20/09/2013.
  • Exhibit 5: two web pages about ISKO containing addresses in Turkey and Italy, dated 29/01/2015 and printed from http://www.isko.com.tr.
  • Exhibit 6: Exchange of emails between Eric Wazana, Second Denim Co. and Yoga Jeans, and different persons from ISKO from 06/10/2011 to 27/07/2012, discussing the prices of cotton, a meeting in Los Angeles and an invitation letter for a European visa application for Tugba from ISKO. In particular, in an email exchange dated 06/10/2011 between Hakan Anuk and Eric Wazana, the following appears: ‘Hi Eric, As a fellow Yogi, I strongly recommend 100% Stretch fabrics for your Yoga Jeans line’. From the email exchange on the same day, it is clear that Hakan Anuk is the sales person of ISKO for New York and Canada.
  • Exhibit 7: extract from the WIPO database about an international registration based on EUTM No 12 952 529 ‘ISKO YOGAJEANS’ in the name of ISKO S.r.l. for goods and services in Classes 24, 25, 35 and 40 and designating Canada, Japan and the USA.
  • Exhibit 8: extract from the WIPO database about an international registration based on EUTM No 13 290 721 ‘YOGAJEANS’ in the name of ISKO S.r.l. for goods and services in Classes 24, 25, 35 and 40 and designating Canada, Japan and the USA.
  • Exhibit 9: extract from the eSearch database about EUTM No 13 290 721 ‘YOGAJEANS’, which was applied for by ISKO S.r.l. on 24/09/2014 for goods and services in Classes 24, 25, 35 and 40 and opposed by Eric Wazana.
  • Exhibit 10: extract from the WIPO database about an international registration based on EUTM No 1 261 955 ‘YOGAJEANS’.
  • Exhibit 11: opposition No B 2 468 232 of 01/10/2015 against EUTM application YOGAJEANS No 13 290 721 where YOGA JEANS and YOGAJEANS have been found identical considering the absence of space in the contested mark as being insignificant.
  • Exhibit 12: Cancellation before the USPTO filed by the applicant against ISKO YOGAJEANS trade mark No 4 787 962.
  • Exhibit 13: Opposition proceedings against trade mark application YOGAJEANS No 2015/38501, dated 05/05/2015 and against trade mark application ISKO YOGAJEANS No 2015/38506 dated 05/052015 in Turkey.
  • Exhibit 14: extracts from the Yoga Jean Twitter account, dated 30/01/2015, showing 1 773 followers.
  • Exhibit 15: extracts from the Yoga Jean Facebook page, dated 30/01/2015.
  • Exhibit 16: Reproduction of a cover of Cosmopolitan and its internal pages showing women wearing jeans. The date appearing in the document when filed again with better quality is August 2013 and Yoga Jeans! is mentioned in the text below the covers.
  • Exhibit 17: celebrity spotting Facebook pages displaying celebrities wearing jeans bearing the mark ‘YOGA JEANS’, namely Emma Stone, Rachel Bilson, Dakota Fanning, Gisele Bündchen, Sofia Vergara, Blake Lively, Alessandra Ambrosio, Naomi Watts, Kristin Cavallari, Fergie, and Lindsay Lohan. The date the document was printed is 12/12/2014.
  • Exhibits 18 and 19: document dated 12/02/2013 mentioning the company Yoga Jeans in booth 944 in Las Vegas on 16-20 February and 18-21 August 2013, in booth 538 in New York on 24-26 February 2013 and in booth 503 in Dallas on 21-24 March 2013.
  • Exhibit 20: copy of a newspaper containing Japanese characters and the title ‘Go Shopping!’ published on Facebook with the date 22/02/2012 and the comment ‘Yoga Jeans- Second Denim- We’re big in Japan!’. Copy of a newspaper containing Japanese characters and the title ‘YOGA Jeans’ published on Facebook with the date 30/11/2012 and the comment ‘The comfort of Yoga Jeans is stretching onto Japan Known for being fashion-forward trend setters, the women in Japan are excited to see Yoga jeans popping up in local boutiques and fashion shows!’. Copy of an article on a Facebook page about Yoga Jeans in Japan, dated 30/04/2013.
  • Exhibit 21: extract from a Facebook page stating ‘The Yoga jeans have officially arrived in London and Fashion Extra Magazine informs us that they are all of the rave’, dated 12/08/2011. Cover of a magazine, DB DENIMBLOG, dated 02/13/2014, and an article entitled ‘Denim Revow: Yoga Jeans Mid-Rise Skinny Jean in Rise Indigo’.
  • Exhibit 22: article on textilla.nl (in Dutch), dated 18/04/2014, mentioning ‘YogaJeans’. Several invoices from Second/Wazana Clothing Inc. to clients in France, the United Kingdom and the Netherlands, mostly for jeans, although the trade mark ‘Yoga Jeans’ is not visible on these invoices.

The EUTM proprietor explains that it did not act in bad faith. The proprietor is the textile division of SANKO, a worldwide famous leader in denim sector. The EUTM proprietor was established in Italy in 2003. It understood that stretch denim became a solution to modern life for all the moments of the day, including yoga sessions. YOGA JEANS is not particularly distinctive. The contested trade mark was filed in Europe, USA and Japan which are the leading markets for denim. ISKO Textile Inc, the American textile company of SANKO, and Wazana had business relationship but not in relation with YOGA JEANS and, in addition, the American company is a different company. The last relationship between ISKO Textile Inc. and the applicant was on 14/03/2012. The marks can coexist in different classes because the businesses are different (B2B vs. B2C). The applicant trade mark is not known in the denim sector. Exhibits 14 and 15 are about YOGA JEANS Canada and are not relevant. Exhibits 16 and 17 are not enough to show the mark is known in England. The EUTM proprietor was not aware of the existence and use of YOGA JEANS.

In support of its observations, the EUTM proprietor submitted the following evidence:

  • Enclosure 1: Press Article in Italian in ‘Il Sole 24 ORE’ about Isko dated 06/10/2015 and press article in TUSTYLE dated 26/10/2015 also in Italian.
  • Enclosure 2: Letter of resignation from ISKO Textile Inc. signed by Hakan Anuk dated 30/04/2014.
  • Enclosure 3: Opposition No B 2 468 232 of 01/10/2015, YOGA JEANS vs. YOGAJEANS.
  • Enclosure 4: Mail exchange dated 30/01/2015 between Jon Gomley from Isko and an Italian lawyer about the Eric Wazana Second denim/YOGA JEANS trade mark and whether it is known in the UK.

The applicant reiterated its previous arguments and added the following observations: the threshold requirement is to prove that there was enough first-hand knowledge as well as public knowledge of the earlier trade mark accessible to the EUTM proprietor, all the more so here it is in the same field of industry as a big international player as is claimed. There is no necessity to prove that the earlier mark is well known. The argument of the EUTM proprietor according to which YOGA JEANS would not be sufficiently visible in the email exchange is not correct as the emails were signed as follows:  (Exhibit 6). All of ISKO offices have the same email addresses ‘@isko.com.tr’, Turkey being the headquarters of the group. It is an integrated group. The fact that Anuk Hakan left the company is irrelevant. It is not true that the relationship between the two companies ended in 2012. As regards the arguments according to which the trend is to produce jeans that can be wore all day long, there is no necessity to use the expression YOGAJEANS to distinguish the products. There is a contradiction in pretending the word is not distinctive while the EUTM proprietor has filed several applications for this word. The coincidence of countries where the contested mark and the earlier mark are registered is an element showing there was bad faith.

New evidence is filed:

  • Exhibit 23: Mail exchange between Eric Wazana and persons from Isko dated 2011 with the following signature .
  • Exhibit 24: Decision No 11 253 C of 23/03/2016 invalidating EUTM N° 12 952 529 ISKO YOGAJEANS of the EUTM proprietor (same parties).
  • Exhibit 25: Decision of the USPTO in English in cancellation case No 92062193 between the parties where trade mark ISKO YOGAJEANS No 4 787 962 from the EUTM proprietor was cancelled on 29/12/2015.
  • Exhibit 26: two Turkish decisions dated 18/04/2016 and 29/03/2016.
  • Exhibit 27: two pages from the EUTM proprietor website showing women exercising in jeans.

It also filed English translations of the two Turkish decisions previously filed as Exhibit 26.

The EUTM proprietor repeated that the applicant’s YOGA JEANS was not, at the time of the EUTM proprietor application, known in the fashion sector. The EUTM proprietor simply rid the trend of the market. With regard to the email address, all the ISKO’s employees have the same second part email address but in 2011 there was not cooperation among ISKO’s offices worldwide. Finally, the EUTM proprietor is specialized in stretch denim fabric. The company is a worldwide leader in the sector.

ABSOLUTE GROUNDS FOR INVALIDITY – ARTICLE 52(1)(b) EUTMR

General principles

Article 52(1)(b) EUTMR provides that a EUTM will be declared invalid where the applicant was acting in bad faith when it filed the application for the trade mark.

Whether a EUTM proprietor acted in bad faith when filing a trade mark application must be the subject of an overall assessment, taking into account all the factors relevant to the particular case (11/06/2009, C-529/07, Lindt Goldhase, EU:C:2009:361, § 37).

The Court of Justice has set out the principle that the assessment of whether or not the applicant is acting in bad faith ‘must be the subject of an overall assessment, taking into account all the factors relevant to the particular case’ (11/06/2009, C-529/07, Lindt Goldhase, EU:C:2009:361, § 37). In this overall assessment, ‘consideration must be given to the [EUTM] applicant’s intention at the time when he files the application for registration’, and this intention is ‘a subjective factor which must be determined by reference to the objective circumstances of the particular case’ (11/06/2009, C-529/07, Lindt Goldhase, EU:C:2009:361, § 41 and 42).

The relevant point in time for determining whether or not there was bad faith on the part of the EUTM proprietor is the time of filing of the application for registration, namely 24/09/2014. However, it must be noted that facts and evidence dated prior to this filing date can be taken into account for interpreting the EUTM proprietor’s intention at the time of filing of the EUTM. Such facts include, in particular, whether or not the mark is already registered in a Member State, the circumstances under which that mark was created and the use made of it since its creation. In addition, facts and evidence dated after the filing date can sometimes be used for interpreting the EUTM proprietor’s intention at the time of filing of the EUTM, in particular whether or not the EUTM proprietor has used the mark since registration.

Part of the evidence submitted by the applicant was sent by fax and the quality of the documents is not perfect, although it has been considered generally sufficient. In addition, part of the evidence has been filed again with better quality.

There is no precise legal definition of the term ‘bad faith’, which is open to various interpretations. Bad faith is a subjective state based on the applicant’s intentions when filing a EUTM. As a general rule, intentions on their own are not subject to legal consequences. For a finding of bad faith, there must be, first, some action by the EUTM proprietor that clearly reflects a dishonest intention and, second, an objective standard against which such action can be measured and subsequently qualified as constituting bad faith. There is bad faith when the conduct of the applicant for a EUTM departs from accepted principles of ethical behaviour or honest commercial and business practices, which can be identified by assessing the objective facts of each case against the standards (12/03/2009, C-529/07, Lindt Goldhase, EU:C:2009:361, § 60).

The burden of proof of the existence of bad faith lies with the invalidity applicant; good faith is presumed until the opposite is proven.

Outline of the relevant facts

The relevant facts are those submitted by the applicant in relation to the absolute ground for invalidity, outlined above. In particular, in the present case, the bad faith argument is supported by the relationship between the parties that existed prior to the filing of the contested trade mark.

Assessment of bad faith

Similarity of the signs

Article 52(1)(b) EUTMR does not require, in principle, that the contested EUTM be identical or similar to an earlier right. However, in cases where the invalidity applicant is claiming that the intention of the EUTM proprietor was to misappropriate one or more earlier rights, such as the present one, it is difficult to envisage how a claim of bad faith may succeed if the signs at issue are not at least similar.

In the present case, both the earlier sign invoked by the applicant, ‘YOGA JEANS’, and the contested trade mark, ‘YOGAJEANS’, are word marks. The signs are visually, aurally and conceptually identical as they coincide in the verbal element ‘YOGA*JEANS’, the only difference being the joining of the words ‘YOGA JEANS’ in the contested sign. The joining of the two words is not sufficient to consider the signs not similar, nor is the fact that the word ‘JEANS’ is descriptive of the jeans covered by the EUTM, as the trade mark must be assessed as a whole. The earlier trade mark is fully included in the contested sign, and the lack of space between the words would practically go unnoticed, since the entire public would understand the meaning of both words ‘YOGA’ and ‘JEANS’ and would be able to separate them mentally, even though, visually, they appear as one word.

In addition, as correctly pointed out by the applicant (Exhibit 11), in an opposition B 2 468 232 of 01/10/2015 between the same parties, against the contested YOGAJEANS No 13 290 721, YOGA JEANS and YOGAJEANS have been found identical considering that the absence of space in the contested mark was insignificant.

The previous relationship between the parties and the EUTM proprietor’s awareness of the applicant’s earlier mark

Bad faith might be applicable when the parties involved have or have had any kind of relationship, such as (pre-/post-) contractual relationships, giving rise to mutual obligations and a duty of fair play in relation to the legitimate interests and expectations of the other party (13/11/2007, R 336/2007-2, CLAIRE FISHER / CLAIRE FISHER, § 24).

The invalidity applicant has shown that it has used a similar mark ‘YOGA JEANS’ for jeans mostly in Canada and in the USA but also in Japan and Europe since the launching of the trade mark in 2005 in Canada. Not only has the applicant used the trade mark but it has also filed trade marks in Canada, the USA, Japan and the European Union, as demonstrated by exhibits 2, 3, 10 and 13. The trade mark has been used with a certain prestige if the following exhibits are considered: Exhibit 17 showing celebrities wearing jeans bearing the trade mark ‘YOGA JEANS’, Exhibit 9 showing the presence of the trade mark ‘YOGA JEANS’ in different fairs in the USA and Exhibit 10 showing use of the trade mark in Japan. Invoices were also produced as well as press articles from European Union sources mentioning YOGA JEANS products in Exhibit 22. As a result, the invalidity applicant has demonstrated use of an almost identical mark for jeans and it has also demonstrated that it filed trade mark registrations in large markets. By contrast, it remains unknown if the EUTM proprietor is using its trade mark.

In the present case, there is also evidence that the parties had a commercial relationship for several months between October 2011 and July 2012, as demonstrated by the email exchanges in Exhibit 6. The fact that the EUTM proprietor and the American company are two different companies is not relevant because it is not contested that both belong to the same group and the EUTM proprietor is in fact the textile division of the American company.

One of the emails is particularly interesting, as it expressly demonstrates that the EUTM proprietor knew abo ut the applicant’s mark ‘YOGA JEANS’: in an email exchange dated 06/10/2011 between Hakan Anuk and Eric Wazana, the following appears: ‘Hi Eric, As a fellow Yogi, I strongly recommend 100% Stretch fabrics for your Yoga Jeans line’. From the email exchange on the same day, it is clear that Hakan Anuk is the sales person of ISKO for New York and Canada. This exchange directly contradicts the argument of the EUTM proprietor according to which ISKO Textile Inc, the American textile company of SANKO, and Wazana had business relationship but not in relation with YOGA JEANS. In addition, the fact that Hakan Anuk resigned on 30/04/2014 is of no relevance because this happened only few months before the filing of the contested trade mark on 24/09/2014.

Although the evidence of the direct relationship between the parties is not particularly extensive, it is sufficient to prove that the parties had a business relationship. It follows from the evidence demonstrating prior contact between the parties that, at the time of filing of the contested EUTM, the EUTM proprietor was aware of the existence of the invalidity applicant’s earlier mark ‘YOGA JEANS’ including in the European Union. The fact that searches were carried out in order to find out if the marks were used for example in the United Kingdom (see enclosure 4 provided by the EUTM proprietor) only confirms that the it was aware at least of the existence of prior trade marks covering the European Union.

Intentions to misappropriate the rights of a commercial partner (duty of fair play)

However, as stated in the case law, the fact that the EUTM proprietor knows or must know that the invalidity applicant has been using an identical/similar sign for identical/similar goods for which a likelihood of confusion may arise is not sufficient for a finding of bad faith (11/06/2009, C-529/07, Lindt Goldhase, EU:C:2009:361, § 40). In order to determine whether or not there was bad faith, the EUTM proprietor’s intentions at the time of filing must also be taken into account.

There is bad faith when the EUTM proprietor intends through registration to lay its hands on the trade mark of a third party with whom it had contractual or pre-contractual relations or any kind of relationship where good faith applies and imposes on the EUTM proprietor the duty of fair play in relation to the legitimate interests and expectations of the other party (13/11/2007, R 336/2007-2, CLAIRE FISHER / CLAIRE FISHER, § 24).

The essential question is, therefore, whether the relationship between the parties created a close enough link to suggest that it is fair to expect the EUTM proprietor not to file an identical or almost identical EUTM application independently without giving the invalidity applicant prior information and sufficient time to take action against the contested EUTM (13/12/2004, R 582/2003-4, EAST SIDE MARIO’S, § 23).

Such a relationship might be sufficiently close if the parties have entered into contractual or pre-contractual negotiations which, inter alia, concern the sign in question. Such a relationship does not have to be specific in such a way as to deal exclusively with, for example, franchise rights for the territory concerned (13/12/2004, R 582/2003-4, EAST SIDE MARIO’S, § 23).

It has been proved that the parties had a business relationship at least about denim fabrics and, during these relationships, the sign ‘YOGA JEANS’ was mentioned and used by the applicant. This type of business relationship means that, in compliance with fair business practices, the EUTM proprietor should have informed the applicant about the registration of the contested mark, since the contested mark is almost identical to the applicant’s mark, and the EUTM proprietor was aware of this, as mentioned above. The EUTM proprietor knew that the trade mark was registered by the applicant. The  fact that it ignored whether it was used within the European Union is not sufficient in order to conclude its trade mark was filed in good faith as the EUTM proprietor admits he knew the mark was used in Canada and in the USA. The fact that the trend of the moment in the denim market is to have elastic fabrics that can adapt to any type of activities including sports is not relevant either. As correctly mentioned by the applicant, elastic denim can be distinguished by any other names and YOGA JEANS is not directly descriptive of any relevant characteristic of the goods. On the contrary, the EUTM proprietor acknowledged that he knew the trade mark was the property of another company (see enclosure 4) with whom it has entered professional discussions in the recent past.

Secondly, if a duty of fair play exists, it must be established whether or not the EUTM proprietor’s actions constitute a breach of a duty of fair play, thereby having been made in bad faith.

In the present case, as already mentioned, the parties had a commercial relationship for several months between October 2011 and July 2012, as demonstrated by the email exchanges in Exhibit 6.

Demonstrating bad faith implies proving that at the time of filing the EUTM proprietor was aware that it was causing harm to the invalidity applicant and that this harm was a consequence of its reproachable conduct from a moral or commercial view (21/04/2010, R 219/2009-1, GRUPPO SALINI / SALINI, § 66).

The contested mark almost identically reproduces the earlier mark ‘YOGA JEANS’, which although mostly used in Canada and in the USA, has acquired a certain prestige within the denim market including within the European Union (as demonstrated by Exhibit 17 showing that jeans bearing the earlier mark are worn by celebrities).

The fact that the earlier mark is known in the competitive sector of jeans demonstrates that the aim of the EUTM proprietor when filing a similar trade mark is to compete unfairly by taking advantage of the earlier sign (11/06/2009, C-529/07, Lindt Goldhase, EU:C:2009:361, § 46-47).

Taken all the circumstances of the case into account, the Cancellation Division considers that the EUTM proprietor’s actions constitute a breach of a duty of fair play, thereby having been made in bad faith.

Therefore, there is a misappropriation of the elements of the earlier trade mark.

Conclusion

In the light of the above principles and of the circumstances and facts presented by the applicant, the Cancellation Division is of the view that the applicant has succeeded in proving its allegation that the EUTM proprietor was acting in bad faith when filing the contested EUTM. The applicant supported its statements with evidence and facts clearly showing that the EUTM proprietor had a duty to refrain from filing the contested mark. Consequently, the applicant is considered to have established the EUTM proprietor’s dishonest intention or any other unfair practice involving bad faith on its part.

When bad faith of the EUTM proprietor is established, the whole EUTM is declared invalid, even for goods and services that are unrelated to those protected by the invalidity applicant’s mark. The General Court confirmed this approach and stated that a positive finding of bad faith at the time of filing of the contested EUTM could only lead to the invalidity of the EUTM in its entirety (11/07/2013, T-321/10, Gruppo Salini, EU:T:2013:372, § 48). The protection of the general interest in business and enabling commercial matters to be conducted honestly justifies invalidating a EUTM also for goods/services that are dissimilar to those of the invalidity applicant and which do not even belong to an adjacent or neighbouring market.

In the light of the above, the Cancellation Division concludes that the application is totally successful and the EUTM should be declared invalid for all the contested goods and services.

COSTS

According to Article 85(1) EUTMR, the losing party in cancellation proceedings must bear the fees and costs incurred by the other party.

Since the EUTM proprietor is the losing party, it must bear the cancellation fee as well as the costs incurred by the applicant in the course of these proceedings.

According to Rule 94(3) and (6) and Rule 94(7)(d)(iii) EUTMIR, the costs to be paid to the applicant are the cancellation fee and the representation costs, which are to be fixed on the basis of the maximum rate set therein.

The Cancellation Division

Liliya YORDANOVA

Jessica LEWIS

Pierluigi M. VILLANI

According to Article 59 EUTMR, any party adversely affected by this decision has a right to appeal against this decision. According to Article 60 EUTMR, notice of appeal shall be filed in writing at the Office within two months of the date of notification of this decision. It shall be filed in the language of the proceedings in which the decision subject to appeal was taken. Furthermore, a written statement of the grounds of appeal shall be filed within four months of the same date. The notice of appeal will be deemed to be filed only when the appeal fee of EUR 720 has been paid.

The amount determined in the fixation of the costs may only be reviewed by a decision of the Cancellation Division on request. According to Rule 94(4) EUTMIR, such a request must be filed within one month from the date of notification of this fixation of costs and shall be deemed to be filed only when the review fee of EUR 100 (Annex I A(33) EUTMR) has been paid.

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