The ruling examines whether a company can rely on trade mark protection to keep hold of a technical or functional element that was previously protected by patent law, and whether doing so amounts to acting in bad faith.

Background

CeramTec, a German manufacturer specialising in high-performance ceramics used in medical implants, once owned a European patent for a composite ceramic material containing chromium oxide. The additive gave the company’s hip and knee joint components a distinct pink colour (Pantone 677C), edition 2010, a tone that became closely associated with CeramTec’s products.

When the patent expired in 2011, CeramTec filed three EU trade mark applications. One for the colour pink itself, another for a pink-coloured ball, and a third for a three-dimensional mark representing a pink prosthetic component. All marks designated the following goods in class 10 “Ceramic parts for implants for osteosynthesis, articular surface replacement, bone spacer blocks; Hip joint balls, hip joint sockets and parts for kneejoints; All of the aforesaid goods for sale to manufacturers of implants”.

In 2013, CeramTec sued its US competitor Coorstek for infringement before the French courts, arguing that Coorstek’s similar pink components copied its registered marks. Coorstek responded with a counterclaim for invalidity, alleging that CeramTec had filed the marks in bad faith, prolonging the commercial advantage of its expired patent by locking up the same technical solution through trade mark rights.

By judgment of 25 June 2021, the cour d’appel de Paris (Court of Appeal, Paris, France) cancelled the contested marks on the ground that CeramTec had filed the application in bad faith. The court concluded that the pink colour resulted from a technical process and that the applications were intended to exclude competitors rather than to indicate commercial origin. 

CeramTec lodged an appeal on a point of law before the Cour de cassation (Court of Cassation, France), which referred the following 3 questions to Luxembourg seeking guidance on the interaction between Articles 7(1)(e)(ii), 52(1)(a) and 52(1)(b) of Regulation 207/2009.

(1) Is Article 52 of Regulation [No 207/2009] to be interpreted as meaning that the grounds for invalidity set out in Article 7, to which Article 52(1)(a) refers, are independent from and do not overlap with the ground of bad faith referred to inArticle 52(1)(b)? 

(2) If the first question is answered in the negative, may the bad faith of the applicant be assessed by reference solely to the absolute ground for refusal of registration set out in Article 7(1)(e)(ii) of Regulation No 207/2009 where no finding has been made that the sign for which registration as a trade mark was sought consists exclusively of the shape of the product which is necessary to obtain a technical result?

(3) Is Article 52(1)(b) of Regulation No 207/2009 to be interpreted as meaning that bad faith is to be ruled out where the applicant has applied for registration of a trade mark with the intention of protecting a technical solution and, after the application was made, it is discovered that there was no connection between the technical solution in question and the signs which constitute the trade mark applied for?’

What the CJEU decided

The Court confirmed that the two absolute grounds for invalidity, technical functionality and bad faith are independent but may coexist. A finding of bad faith does not depend on first establishing that the sign consists exclusively of a shape necessary to achieve a technical result, and vice versa.

Article 7(1)(e)(ii) serves a public interest function as it prevents applicants from obtaining perpetual exclusive rights over functional or technical features that competitors may use once a patent has expired. By contrast, Article 52(1)(b) focuses on the applicant’s conduct. Its purpose is therefore to penalise an inherent defect in the application for registration and not in the trade mark itself, even if the mark could in principle function as an indicator of origin.

Bad faith may be established when a trade mark application is filed after the expiry of a patent with the intention of extending that technical monopoly.

When assessing such intent, the decision highlights the need for a fact-specific, overall assessment considering:

•           the nature and origin of the sign;

•           how and why it was created and used;

•           the scope of the expired patent;

•           the commercial reasoning for the filing; and

•           the timeline of events leading up to the application.

This judgement highlights that the applicant’s mindset must be judged at the time of filing. Later findings cannot rewrite the applicant’s earlier intention.

Comment

This judgment emphasises that bad faith is an autonomous concept designed to catch manipulative or strategically abusive filings. It is not confined to classic scenarios of copying or blocking but extends to attempts to misuse trade mark law - in this case to prolong the life of an expired patent. 

Brand owners and product designers should be reminded that filing for colour or shape marks that correspond to technical outcomes needs careful consideration as it cannot be used as an option to extend patent rights, regardless of their status. 

Bad faith remains a powerful option for challenging registrations. This judgment re-affirms the difference between trade mark and patent protection and solidifies intent of maintaining fair competition within the EU.