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Surprise defeat for MONOPOLY

Hasbro Inc, the makers of a wide range of toys and games including the popular board game Monopoly, suffered a surprise defeat at the Boards of Appeal at the European Union Intellectual Property Office (EUIPO) in which one of their European Union registrations for the MONOPOLY trade mark was declared partially invalid on the ground that it had been applied for in “bad faith”.

Hasbro is the owner of a number of European Union trade mark registrations dating back to 1996 for the MONOPOLY trade mark. In 2010, Hasbro filed a new application to register MONOPOLY in the European Union in relation to a range of goods and services, including some that were already covered by their earlier registrations. In 2015, Kreativni Dogadaji doo, a company based in Croatia, applied to invalidate the resulting registration on the ground that it was a repeat filing and therefore that Hasbro had been acting in bad faith when applying to register it.

Legal Background

European Union trade mark law provides that a trade mark registration shall be declared invalid if the applicant was acting in bad faith when applying for the registration. The principal of “bad faith” is intended to generally encompass dishonest and unethical conduct or illegitimate business practices. Accordingly, what is or is not bad faith is not precisely prescribed but rather must be considered on a case-by-case basis. Whether or not repeat filings may constitute bad faith had not previously been considered in any detail.

An important aspect of European Union trade mark law is that a trade mark registration may become unenforceable and vulnerable to revocation in relation to any goods or services for which the trade mark has not been used for any continuous period of five years following registration. Accordingly, in order to enforce a trade mark registration that is over five years old, it may be necessary for the registration owner to provide evidence that the trade mark has been used within the preceding five years. This can be a complex and laborious process in some cases and in any case increases the burden on the trade mark owner when they are attempting to enforce their registrations.

Reasons for the Decision

The Board of Appeal noted that applying to register a trade mark in relation to goods or services that are already protected by a registration (ie a repeat filing) may enable the trade mark owner to evade the legal obligation to submit evidence of trade mark use when attempting to enforce a registration, as well as the corresponding sanctions for failing to provide sufficient evidence of use. The Board noted that conduct intended to evade legal requirements such as this may be considered bad faith.

Hasbro provided a number of reasons for the repeat filing, including that it made administration of their trade mark portfolio easier and that repeat filings are in any case common practice. However, Hasbro did also admit that one consideration for making a repeat filing was avoiding the requirement to prove use.

The Board of Appeal therefore found that Hasbro acted in bad faith when making their repeat filing and hence declared the resulting registration invalid in relation to all goods and services that were already covered by their earlier registrations. The registration was not cancelled in relation to the goods and services that were not covered by their earlier registrations.

Summary

Repeat filings are a relatively common practice and hence this decision has the potential to affect the validity of a large number of existing trade mark registrations. However, as bad faith must be considered on a case-by-case basis and the specific intention of the applicant at the time an application is filed is a decisive factor, this decision does not necessarily mean that all repeat filings will be considered to have been made in bad faith.

In any case, Hasbro have the option of appealing to the General Court and then to the Court of Justice of the European Union and hence this is not necessarily the final outcome of this case.

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