In a whopper of a decision, the Cancellation Division of the EU Intellectual Property Office (“EUIPO”) revoked McDonald’s BIG MAC EU trade mark registration. On January 11, 2019, in a non-use cancellation action (Cancellation No 14 788 C) filed by Supermac's (Holdings) Ltd., the EUIPO decided that McDonald’s had failed to prove genuine use of its BIG MAC trade mark, and it revoked the mark in its entirety.
For many, the McDonald's name is synonymous with fast food, so the decision may come as a surprise. However, it teaches a number of how’s and why’s and highlights the pitfalls that await anyone who is required to prove the use of its trade mark in an EUIPO opposition or cancellation proceeding.
Where did it all begin?
The fight that recently hit the news headlines has been brewing for quite a while. Supermac's, an Irish, family-run fast food chain, opened its first Supermac's restaurant in 1978 in Ballinasloe, County Galway, and appears to have been trading only in Ireland and Northern Ireland since then. Supermac's earliest national Irish trade mark registrations are from 1989.
McDonald’s claims to have begun using its name in Ireland in 1977 with the opening of its first restaurant in Dublin. Meanwhile, its registered trade mark rights in Ireland date back to 1968 for McDONALD’S and to 1975 for BIG MAC. To date, McDonald’s owns some 180 active EU trade marks.
Despite the two brands’ seemingly successful coexistence in Ireland, a feud began when Supermac's applied for its first EU trade mark SUPERMAC'S in 2014. McDonald’s successfully opposed that attempt, and a cat-and-mouse game has continued since then between the two companies.
What is genuine use?
In its cancellation application, Supermac's asserted that McDonald’s EU trade mark was not put to genuine use during a continuous period of five years following the date of registration in relation to any of the registered goods and services, which we summarised as “prepared foods, sandwiches and services of operating and franchising restaurants.”
In its decision, the Cancellation Division said that to avoid having its trade mark cancelled for non-use, the trade mark owner must establish the place, time, extent, and nature of use of the contested trade mark for the goods and services for which it is registered. The Division also said that, as the European Court of Justice has determined, all of these factors must be established:
This means that the evidence must provide sufficient indication of all of these factors in order to prove genuine use. Failure to fulfil one of the conditions will lead to the evidence of use being rejected as insufficient and, as at least the extent of use has not been established, it is not necessary to enter into the other requisites.
McDonald’s responded to the cancellation action by claiming use in a number of Member States, but most of the evidence it filed related only to three countries: Germany, France, and the United Kingdom. McDonald’s argued that the use of its mark in these countries, “which are three of the economically most important Member States is sufficient to prove that the mark is used in the European Union.”
Where did it all go wrong?
McDonald’s bundle of evidence consisted of the following four types of materials:
Having analysed the evidence provided by McDonald’s, the Cancellation Division concluded in its decision that it was insufficient to prove that the EU trade mark was genuinely used in the relevant territory—the EU—during the relevant period of five years. The decision includes detailed comments on the shortcomings of each piece of evidence McDonald’s offered and thus provides great insight into what materials the EUIPO requires to prove use.
In addition, the Cancellation Division noted that the affidavits of McDonald’s representatives, although admissible, were drawn up by the interested party itself and thus considered to be “affected by its personal interests in the matter.” As a result, it said, the probative value of the affidavits’ statements depended on whether or not they were supported by other types of evidence—including, most importantly, evidence from independent sources.
The Cancellation Division also found that while some of the evidence McDonald’s provided (e.g., some of the brochures and printouts from websites) referred to several of the relevant factors, McDonalds had not established all of the factors—in particular, the “extent” of use of its mark. The Division further pointed out that because all of this evidence originated from McDonald’s itself, it lacked the probative value of independent evidence.
Commenting on the website printouts, the Cancellation Division noted that:
the mere presence of a trade mark on a website is, of itself, insufficient to prove genuine use unless the website also shows the place, time and extent of use or unless this information is otherwise provided.
The Division then noted that “useful evidence” to support the information on the websites would have been “records relating to internet traffic and hits attained at various points in time or, in some cases, the countries from which the web page has been accessed kept when operating.”
It also reminded McDonald’s that:
Wikipedia entries cannot be considered as a reliable source of information, as they can be amended by Wikipedia’s users.
The Cancellation Division also criticized the way McDonald’s submitted its brochures and packaging, saying it provided no information about how the brochures were circulated, who they were offered to, whether they had led to any purchases, or how many of the products for which the packaging was used were actually sold.
Lessons to be learned?
This decision reminds us once again that in EUIPO proceedings, the trade mark owner’s confidence in its goodwill is worthless unless it can provide conclusive evidence of the goodwill’s existence. Take-home points for any trade mark owner facing a request for proof of use at the EUIPO are:
To be continued?
McDonald’s has until March 11, 2019 to appeal the Cancellation Division’s decision, and since it’s unlikely to go down without a fight, we may see further instalments in this Tale of Two Macs. Additionally, there is a pending application by Supermac’s to cancel McDonald’s EU mark for MC, and McDonald’s has flied oppositions to several of Supermac’s pending trade mark applications—so we’ll keep our eyes peeled for the outcomes in these matters.
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