Christian Louboutin SAS v Van Haren Schoended BV
08 March 2018
Lately, the famous red soles that have been a signature style for Christian Louboutin since 1993 have been more pain than pleasure for the French fashion designer, due to the uncertainties over their trademark registrability.
Christian Louboutin holds a registration for a Benelux trademark covering high-heeled shoes (other than orthopaedic shoes) depicting the red sole and described as consisting of the colour red applied to the sole of a shoe. This trademark registration was challenged by Van Haren and while considering the case, the Rechtbank Den Haag (District Court of the Hague) referred a question to the Court of Justice of the European Union (CJEU) for a preliminary ruling seeking a clarification on the applicability of the prohibition in Article 3(1)(e)(iii) of Directive 2008/95. Advocate General Szpunar delivered his first opinion on the matter on 22 June 2017. However, instead of issuing a judgment, the CJEU reassigned the case to the Grand Chamber. The court reopened the oral procedure and requested the parties to attend a new hearing and the AG delivered his second opinion on 6 February 2018.
Article 3(1)(e)(iii) stipulates that signs “which consist exclusively of (…) the shape which gives substantial value to the goods shall not be registered or if registered shall be liable to be declared invalid”. Following the recent trademark reform, this wording is to be expanded in member states by 14 January 2019 to refer to signs “which consist exclusively of the shape, or another characteristic, which gives substantial value to the goods”.
In his first opinion, the AG pointed out that it should first be determined how the subject mark should be classified and that it was a factual assessment for the referring court. The AG concluded that the red sole trademark was better conceptualised as a mark consisting of the shape of the goods and seeking to protect a certain colour in relation to that shape. If the referring court agreed with that view, then the prohibition set out in Article 3(1)(e)(iii) would apply. He did point out, however, that this prohibition was based on an objective analysis taking into account only the intrinsic value of the shape and not attractiveness of goods flowing from the reputation of the trademark or its owner.
The second opinion largely repeats what was said in the first one, expanding on some newly raised issues. The AG’s view that the mark should be classified as a sign consisting of the shape of the goods and seeking protection for a colour in relation to that shape is even firmer as he expressed his doubts that the colour red used separately from the shape of the sole would be able to identify its proprietor. He also referred to the arguments expressed by a few parties (a number of member states intervened) that the mark should be classified as a position mark, since this type of mark has now been introduced in the EU trademark system. He stated that the change in that classification would make no difference as the Article 3(1)(e)(iii) prohibition would still apply because it refers to “signs which consist exclusively of the shape” and not just to shape marks.
The AG agreed with arguments that the appeal of aesthetic characteristics might vary in line with fashion trends. As such, certain characteristics would be available to everyone because the Article 3(1)(e)(iii) prohibition would apply only during particular periods of time depending on the public’s preferences, while prohibitions set out in Article 3(1)(e)(i) and (ii) had pre-determined lasting effect. He did, however, stress that although the public’s perception could determine that certain characteristics gave substantial value to the goods, it did not mean that the reputation of the mark or its proprietor could be taken into account.
Once again, at first glance it seems that the AG’s opinion is not in favour of Louboutin as he states that the mark at issue will be caught by the Article 3(1)(e)(iii) prohibition. However, it is worth repeating that the AG expressly stated that if the concept of a shape giving substantial value to the goods were to stem from its attractiveness to the public, it would be necessary to exclude the characteristics linked to the reputation of the mark or its proprietor, to prevent the appeal created by that reputation being attributed to a shape which, taken on its own, would not be attractive. This could be that a certain characteristic is valuable to the public because it is now fashionable and it may not be in five years, but in that case, the prohibition would work only temporarily to block a monopoly over something that is valuable only because of its trendy nature. If the characteristic is valuable due to reputation of the mark or its proprietor, per analogiam with the acquired distinctiveness exemption, the Article 3(1)(e)(iii) prohibition won’t apply.
If the CJEU follows the AG’s opinion with the necessary caveats that he makes, it will not be such bad news for trademark owners. The value of the red soles does not stem from the fact that they are in fashion regardless of who makes them, their value is attached to Christian Louboutin and his shoes. The challenge that his lawyers will face will be to prove that this reputation is the only factor producing the substantial value. If they succeed, the registration should remain valid.