Clifford Chance

Following the decision by the European Union Intellectual Property Office ("EUIPO") to refuse the registration of a sound sign as a trade mark of the European Union, the GCEU (Fifth Chamber, Extended Composition) has had the opportunity to rule for the first time on the registration of a sound mark filed in audio format.

The audio file submitted by the German company Ardagh Metal Beverage Holdings GmbH & Co. KG ("Ardagh") together with its application for registration of a sound mark contained a combination of sounds and, in particular, the sound produced by a can of soft drink when opened, followed by silence and a fizzing sound. As we shall see, the GCEU, rejecting the appeal lodged by the applicant against the decision of the Second Board of Appeal of the EUIPO of 24 July 2019 refusing registration (Case R-530/2019-2), concludes in its recent judgment that that sound cannot be registered as a sound mark for different beverages and for metal packaging for transport and storage because it lacks distinctive character.

The judgment of the GCEU, handed down on 7 July 2021 in Case T-668/19 (the "Judgment"), provides us, before reaching its conclusion of lack of distinctiveness, with a series of considerations regarding the criteria for assessing the distinctiveness of sound marks and the general perception of this type of mark among consumers. 

Background to the case

On 6 June 2018, Ardagh filed an application for registration of a European Union trade mark with the EUIPO under Regulation (EU) 2017/10011¹ and, in particular, of a sound mark filed in audio format and consisting of the sound produced by a can of soft drink when opened, followed by a silence of approximately one second and a subsequent bubbling of about nine seconds. Registration was requested for goods within Classes 6, 29, 30, 32 and 33 of the Nice Agreement² , corresponding, in the case of Class 6, to metal containers for the transport and storage of, inter alia, liquids and gases under pressure, and, in the case of Classes 29, 30, 32 and 33, to beverages of various kinds.

On 2 July 2018, the EUIPO examiner informed Ardagh that the mark applied for could not be registered as a trade mark because it could not be perceived as an indicator of the commercial origin of the goods to which it referred. In line with that, by decision of 8 January 2019, it rejected the application for registration on the grounds that the mark applied for lacked distinctive character within the meaning of Article 7(1)(b) of Regulation 2017/1001, according to which the registration of trade marks which do not have distinctive character will be refused. This decision was appealed by Ardagh.

After analysing the appeal lodged by Ardagh against the EUIPO decision of 8 January 2019, the Second Board of Appeal of the EUIPO (the "Board of Appeal"), by decision of 24 July 2019 (the "Contested Decision"), dismissed that action, as the EUIPO examiner had already done half a year earlier, on the grounds that the sound mark applied for lacked distinctiveness.

In the Contested Decision, after reminding us that the criteria for assessing the distinctive character of sound marks are no different from those applicable to other categories of marks, the Board of Appeal stated that the general public, which has a medium level of attention and is the relevant public in the case of goods in Classes 29, 30, 32 and 33, was not necessarily accustomed to considering a sound as an indication of the commercial origin of unopened beverage containers and packaged beverages. It added that, in order to be registered as a trademark, a sound must have the capacity to be recognised so that it could indicate to consumers the commercial origin of the goods or services in question. And, finally, the Board of Appeal considered that the mark applied for consisted of a sound inherent in the use of the goods in question, and that the relevant public would therefore perceive it as a functional element and an indication of the qualities of the goods in question.

In the light of the foregoing, on 1 October 2019 Ardagh brought an action against the Contested Decision, seeking the GCEU to annul it and to order EUIPO to pay the costs, all on the basis, essentially, of the following six pleas in law: 

• The first, alleging infringement of Articles 72(2) and 95(1) of Regulation 2017/1001 and referring to errors of assessment allegedly incurred by the Board of Appeal by distorting the facts;
• the second, alleging infringement of Article 72(2) of Regulation 2017/1001 and referring to a failure on the part of the Board of Appeal to comply with its obligation to state reasons; 
• the third, based, in essence, on an error of law, in so far as the Board of Appeal would have applied an erroneous criterion in assessing the distinctive character of the mark applied for, failing to do so in the light of the relevant case-law;
• the fourth, alleging infringement of Articles 72(2) and 7(1.b) of Regulation 2017/1001 and referring to the fact that the Board of Appeal had wrongly concluded that the mark applied for was devoid of distinctive character;
• the fifth, alleging infringement of Articles 72(2) and 95(1) of Regulation 2017/1001 and concerning an erroneous assessment by the Board of Appeal of certain facts; and
• finally, the sixth, based on an infringement of Article 72(2) of Regulation 2017/1001 and referring to an infringement of Ardagh's right to be heard.

For its part, EUIPO asked the GCEU to dismiss Ardagh's action against the Contested Decision and order the appellant to pay the costs.

On the basis of the reasoning set out below, the GCEU, in its recent Judgment, dismisses in its entirety the action brought by Ardagh and concludes, as the Board of Appeal previously did in the Contested Decision, that the sound mark applied for in audio format by Ardagh is not distinctive and, therefore, cannot be registered.

Reasoning behind the GCEU Judgment

The third and fourth pleas in Ardagh's action concerning the assessment of the distinctive character of the mark applied for In Ardagh's view, when the Board of Appeal analysed the distinctive character of the mark applied for, it applied criteria not covered by Article 7(1.b) of Regulation 2017/1001. In particular, those criteria established by the case-law developed in relation to three-dimensional marks, according to which, in order for the trade mark to fulfil its function as an indication of the commercial origin of the goods in question, it must differ "significantly" from the rule or practices in the sector, a criterion which, according to the appellant, would not be applicable in the present case. Ardagh is of the opinion that the sound reproduced by the mark applied for is unusual for goods in Classes 29, 30, 32 and 33 which do not contain carbon dioxide gas, and the distinctive character which would already exist for that mark would therefore be strengthened. And, in the case of goods of those classes containing carbon dioxide gas, the sound elements making up the mark applied for are distinguished from the sound produced by opening cans of soft drinks common on the market and would therefore be perceived by the relevant public as an indication of the commercial origin of those goods.

Before going into the assessment of Ardagh's content of the third and fourth pleas, the GCEU reminds us in its Judgment that a trade mark has distinctive character within the meaning of article 7.1.b) of Regulation 2017/1001 when "it serves to identify the product for which registration is requested by attributing a certain business origin to it and, therefore, to distinguish this product from those of other companies".³

That distinctive character, it continues, "must be assessed in relation, on the one hand, to the goods or services for which registration has been requested and, on the other, to the perception of the relevant public".⁴ And this relevant public must be able to perceive the sound sign whose registration is requested "as [a] mark and not as [an] element of a functional nature [...] without intrinsic characteristics of its own" and for this it is necessary that this sign "has a certain force"⁵.

In addition, the GCEU indicates that the criteria for assessing distinctiveness "are the same for all categories of marks", since Article 7.1 of Regulation 2017/1001 "does not distinguish between those different categories" and, therefore, "the criteria for assessing the distinctive character of sound marks are not different from those applicable to the other categories of marks"⁶.

Having said that, and going on to rule on the criterion applied by the Board of Appeal in analysing the distinctiveness of the sound mark applied for by Ardagh, the GCEU states that, in fact, as the appellant claims, that criterion is the one established by the case-law relating to three-dimensional marks, which "has been developed in the light of the particular situation in which a mark applied for consists of the shape of the product itself or of its packaging, when there is a rule or uses of the sector relating to that form", being such that consumers accustomed to seeing certain forms corresponding to the standard or uses of the sector "will not perceive the mark requested as an indication of the commercial origin of the products [...], if the form that constitutes that mark is identical or similar to the usual form or forms".

That case-law, according to the GCEU, does not establish any new criteria for assessing the distinctive character of a mark, but merely specifies that, in the context of the application of those criteria, the perception of the relevant public may be influenced by the nature of the sign for which registration is sought. Thus, the perception of the average consumer is not necessarily the same in the case of a three-dimensional mark, consisting of the appearance of the product itself or its packaging, as in the case of a word, figurative or sound mark, consisting of signs independent of the exterior appearance or shape of the goods it designates.⁷

Consequently, the GCEU holds in its Judgment that that case-law relating to three-dimensional marks is not applicable, in principle, to sound marks. Thus, not reproducing the mark applied for by Ardagh the shape of the goods in question or that of their packaging, the Board of Appeal erred in considering the case-law applicable by analogy and applying the criterion of determining whether the mark applied for differed "significantly" from the rule or practices in the sector. However, even though EUIPO incorrectly applied that case-law, the GCEU states that that error is not such as to vitiate the reasoning set out in the Contested Decision, which is also based on another ground.

Regarding that other ground, based on the perception of the mark applied for by the relevant public as being a functional element of the goods in question, the GCEU observes, firstly, that the sound produced by the opening of a can will in fact be considered, having regard to the type of goods, to be a purely technical and functional element. The opening of a can or bottle is inherent to a technical solution connected to the handling of drinks in order to consume them and such a sound will therefore not be perceived as an indication of the commercial origin of those goods. Secondly, the relevant public immediately associates the sound of fizzing bubbles with drinks. In addition, the GCEU observes that the sound elements and the silence of approximately one second, taken as a whole, do not have any inherent characteristic that would make it possible for them to be perceived by that public as being an indication of the commercial origin of the goods. Those elements are not resonant enough to distinguish themselves from comparable sounds in the field of drinks.

Therefore, the Court confirms EUIPO’s findings relating to the lack of distinctive character of the mark applied for and, consequently, rejects the third and fourth pleas in the action brought by Ardagh.

The first and fifth pleas in Ardagh's action concerning errors of assessment

According to Ardagh, the Board of Appeal wrongly considered, at least in respect of the categories of non-alcoholic beverages, still drinks and mineral waters, that all the products for which the sound mark was applied for were beverages which could contain carbon dioxide. Furthermore, according to the appellant, it was also wrong to point out that it was unusual, in the beverage and beverage packaging markets, to indicate the commercial origin of a product solely by means of sounds, since it is possible to imagine many distribution methods using a sound. In so doing, the Board of Appeal introduced into its assessment, an erroneous personal finding, instead of a well-known fact.

In that regard, the GCEU states in its Judgment that the fact of considering that all the products for which the trade mark was applied for were beverages that could contain carbon dioxide was an error that did not have a determining influence in concluding the lack of distinctive character of the same, since that conclusion was reached regardless of whether or not the products contained carbon dioxide. That being the case, the appellant's argument based on that error is inoperative and cannot therefore lead to the annulment of the Contested Decision.

As regards the Board of Appeal's finding that it is unusual on the market for drinks and their packaging to indicate the commercial origin of a product using sounds alone on the ground that those goods are silent until they are consumed, the GCEU refutes this. The GCEU points out that most goods are silent in themselves and produce a sound only when they are consumed. Thus, the mere fact that a sound is made only on consumption does not mean that the use of sounds to indicate the commercial origin of a product on a specific market would still be unusual. The GCEU explains nonetheless that any error on EUIPO’s part in that regard does not lead to the annulment of the Contested Decision, because it did not have a decisive influence on the operative part of that decision.

Consequently, the GCEU rejects the first and fifth pleas in law in Ardagh's action, alleging, in essence, errors of assessment.

The second plea in Ardagh's action concerning failure to comply with the obligation to state reasons

Ardagh considers that the Board of Appeal did not examine the distinctive character of the mark applied for in respect of products which do not contain carbon dioxide and that, as stated in the Judgment, this is recognised by EUIPO, which, nevertheless, considers that it is not a ground for annulling the Contested Decision. Furthermore, the appellant adds, the assertion that it is still unusual to indicate solely by sound the commercial origin of the products on the beverage and beverage packaging markets would not be sufficiently substantiated, particularly in view of the publications provided by the appellant on the current work of sound engineers in the field of acoustic accompaniment of foodstuffs placed on the market.

As regards the alleged failure to state reasons, the GCEU reminds us of the need for all EUIPO decisions to be, in accordance with the first sentence of Article 94(1) of Regulation 2017/1001, reasoned, and admits that, although it is true that the Board of Appeal, starting from the erroneous premise that all the products in Classes 29, 30, 32 and 33 were carbonated beverages, did not include in the Contested Decision an explicit statement of reasons concerning the lack of distinctiveness of the mark applied for in respect of carbon-free products, in its view, the Contested Decision is sufficiently reasoned as a whole.

On the other hand, as to the fact that the assertion that it is still unusual to indicate solely by sound the commercial origin of the products in the beverage and beverage packaging markets would not be sufficiently substantiated, the GCEU considers that the failure of the Board of Appeal to expressly comment on that argument based on the work of the sound engineers does not mean that it did not comply with its obligation to state reasons. As the GCEU reminds us in its Judgment, that obligation does not constitute an obligation for the EUIPO to respond to all the allegations and evidence submitted for its assessment, but it is sufficient for it to refer to the facts and legal considerations that are of "essential importance in the system of the resolution".

In the light of the foregoing, the GCEU rejects the second plea in the action brought by Ardagh, alleging breach of the obligation to state reasons.

The sixth plea in Ardagh's action alleging infringement of the right to be heard

Ardagh considers that it was unable to submit observations on the requirement of availability referred to by the Board of Appeal in paragraph 23 of the Contested Decision, thereby infringing its right to be heard, an argument which is not shared by EUIPO.

Prior to making its assessments in this regard, the GCEU reminds us in its Judgment that the EUIPO, as it follows from article 94.1, second sentence, of Regulation 2017/1001, can only base its decisions on elements of fact and law on which the parties have been able to submit observations, thereby enshrining the general principle of protection of the right of defence, by virtue of which "the addressees of decisions of public authorities that significantly affect their interests must have the opportunity to make their point of view known effectively".

Having made this reminder, the GCEU concludes that Ardagh's right to be heard was not violated. In the context of the exchanges between the parties during the administrative proceedings before the Board of Appeal, the Board of Appeal made a clarification as to the existence of a requirement for the availability of the sounds which made up the mark applied for. The Board of Appeal confines itself to replying to the appellant's letter of appeal and, in particular, to the argument alleging, in essence, that  the registration of the mark applied for does not prevent other economic operators from using its signs to market various liquids with foam triggers, and does so without raising any new elements. Therefore, that clarification by the Board of Appeal could not, in itself, require it to give Ardagh the opportunity to put forward its point of view on the matter.

That being the case, the GCEU rejects the sixth plea in the action brought by Ardagh, alleging infringement of the right to be heard.

The Judgment of the GCEU

The GCEU, in its Judgment of 7 July 2021 in Case T-668/19, dismisses in its entirety the action brought by Ardagh against the decision of the Second Board of Appeal of the EUIPO of 24 July 2019, which refused to register a sound sign presented in audio format as a trade mark of the European Union. In the GCEU's view, the mark applied for by the appellant is devoid of distinctive character and therefore cannot be registered.

As regards costs, the GCEU agrees in its Judgment that, in view of the numerous errors in the Contested Decision of the Board of Appeal and even if it is not annulled, each party will bear its own costs in the proceedings before the GCEU and the appellant, in addition, the essential expenses incurred in connection with the proceedings before the Board of Appeal of the EUIPO.

This was the first time that the GCEU had had the opportunity to give a ruling on the registration, as a European Union trade mark, of a sound mark submitted in audio format. This being the case, and not knowing when there will be more opportunities like this again, we will take this Judgment as an important precedent.

¹ Regulation (EU) 2017/1001 of the European Parliament and of the Council of 14 June 2017 on the European Union trade mark (OJ 2017, L 154, p.1) ("Regulation 2017/1001").

² Nice Agreement concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks of 15 June 1957, as revised and amended.

³ The judgments of 21 January 2010 (Audi v OHIM, C-398/08 P, EU:C:2010:29, paragraph 33 and the case-law cited) and 20 October 2011 (Freixenet v OHIM, C-344/10 P and C-345/10 P, EU:C:2011:680, paragraph 42 and the case-law cited) are along these lines, as cited by the GCEU in its Judgment.

⁴ The judgment of 12 February 2004 (Henkel, C 218/01, EU:C:2004:88, paragraph 50 and the case law cited therein) is along the same lines, as cited by the GCEU in its Judgment.

⁵ The judgment of 13 September 2016 (Sound mark, T-408/15, EU:T:2016:468, paragraph 45), cited by the GCEU in its Judgment, is along the same lines.

⁶ The judgment of 13 September 2016 (Sound mark, T-408/15, EU:T:2016:468, paragraph 41 and the case law cited therein) is along the same lines, as cited by the GCEU in its Judgment.

⁷ The judgment of 12 December 2019 (EUIPO v Wajos, C 783/18 P, unpublished, EU:C:2019:1073, paragraph 24 and the case law cited therein), cited by the GCEU in its Judgment, is along these lines.