Simply filling a soft drink bearing a trademarked brand name does not itself violate an EU directive regarding use of that sign, according to the European Court of Justice (CJEU) in a high-profile ruling involving Red Bull.
Since 2006, the Austrian energy drinks mammoth has been locked in a legal dogfight with Dutch company Frisdranken Industrie Winters (Winters), part of the Refresco group (2010 turnover €1.22bn).
In a statement regarding its ruling last Thursday, the court noted that Red Bull had registered its name as a trademark internationally, where this included the Benelux countries.
A dispute arose because Winters filled cans with fizzy drinks for customer and Red Bull rival Smart Drinks, which supplied the Dutch firm with cans branded with names such as ‘Bullfighter’, ‘Pitbull’, ‘Red Horn’ and ‘Live Wire’.
Matching lids were also provided, as well as an extract used in the drinks; the court heard how Winters filled the cans with the extract as per Smart’s instructions, added water and CO2 if necessary, before sealing them.
Trademark infringement pressed
However, Winters did not deliver or sell the cans to any third party; once filled the cans then reverted to the control of Smart Drinks.
Red Bull argued before the Dutch courts that Winters had infringed its trademark rights, and sought an order that the company should, in the court statement’s words, “cease use of signs which are similar to its trademarks”.
The Hoge Raad der Nederland (Supreme Court of Netherlands) – which is still due to pass judgement on the case – then asked the CJEU whether merely filling packaging that bears a sign similar to a protected trademark should be regarded as use of that sign.
More specifically, use of that sign in the course of trade within the framework of Council Directive 89/104/EEC, which seeks to approximate the laws of member states relating to trade marks.
The CJEU found that, under the so-called Trade Mark Directive, a trademark proprietor could stop a third party from using a sign identical or similar with its trademark without his consent.
The court noted that in the Winters case, “it is apparent from the decision to refer that the signs at issue on the cans filled by Winters are, at most, similar to the protected signs of Red Bull and not identical to them”.
Furthermore, the court said that such protection under the directive only applied when the trademark was used in the course of trade and in relation to identical or similar goods or services (thus preventing possible public confusion), or if its use could affect the essential function of a trademark “to guarantee to consumers the origin of the goods and services”.
Assessing whether Winters had “made use” of signs similar to Red Bull’s trademark in the current case, the court said that “the fact of creating the technical conditions necessary for the use of a sign and being paid for that service, does not mean that the party offering the service itself uses that sign”, under Article 5 of the directive.
“Such a service provider merely executes a technical part of the production process of the final product without having any interest in the external presentation of cans and in particular in the signs thereon, and thus only creates the technical conditions necessary for the other person to use them,” the CJEU statement said.
In addition, the court said that in no way did Winters use the signs for goods and services identical or similar to those under which Red Bull had registered the trademark.
A preliminary ruling allows member state courts to refer questions of interpreting EU law, or its validity within an act, to the CJEU for guidance.
A Red Bull spokeswoman told BeverageDaily.com that the company would not comment on an ongoing court case, while Winters was unavailable for comment.