Champagne celebrates Champagnola ruling

The Comité Champagne has successfully challenged the attempt by Czech company Breadway to trademark the term ‘Champagnola’ for use on baked goods, as Manon Brodin explains.

In April, EUIPO’s Fourth Board of Appeal refused the EU trademark application (EUTM) for ‘Champagnola’ on the grounds of ‘evocation’ of the Protected Designated Origin (PDO) Champagne. The decision provides an important clarification of the concept of evocation of a geographical indication (GI), and indicates that any trademark application that exploits the reputation of a PDO can be refused, even if the products or services are not similar.

A three-year battle

In 2017, Czech company Breadway applied to register an EUTM for ‘Champagnola’ in classes 30, 40 and 43. While its application for class 43 (catering services) was refused, the trademark application was published for classes 30 (bread, pastry, baking preparations) and 40 (bakeries, semi-finished bakery and confectionery products, bakery services), prompting the Comité Champagne (CIVC) to oppose the application on the basis of its prior rights.

In its 5 August 2019 decision, EUIPO rejected the opposition on the grounds that the goods and services designated by the contested application were not similar to Champagne wine. EUIPO also found that there was no commercial use or ‘evocation’ of the Champagne PDO and, therefore, no likelihood of confusion. CIVC appealed the ruling to EUIPO’s Board of Appeal.

In its April decision, the Board considered that the essential function of a PDO is to protect the geographical origin of the product and, in particular, use of the geographical name on products that do not come from this area.

Article 8(6) of the EU Trademark Regulation (EUTMR) read in combination with articles 102 and 103 of Regulation No 1308/2013 (on the common organisation of markets for agricultural products) provides that the holder of a PDO may object to the registration of a subsequent mark under the conditions of article 103(2)(a)(ii) of Regulation No 1308/2013, namely:

“Protected designations of origins and protected geographical indications and the wines using those protected names in conformity with the product specification will be protected against [...] any direct or indirect commercial use of a protected name: (i) by comparable products not complying with the product specification of the protected name; or (ii) insofar as such use exploits the reputation of a designation of origin or a geographical indication.”

Since the products and services concerned were not similar in the disputed application, the reputation of the PDO Champagne first needed to be established. Three conditions were considered: ‘evocation’ (a criterion which is specific to the law of geographical indications), reputation and exploitation of that reputation by a third-party.

Establishing reputation, evocation and damage

As one of the most renowned wine PDOs in Europe, establishing the reputation of Champagne was of no particular difficulty. However, the Board of Appeal did provide some important details regarding the two other conditions.

• Evocation: This can be established when the term used to designate a product incorporates part of a protected designation, so that when the consumer is confronted with the name of the product, the image aroused in their mind is that of the product whose designation is protected. Unlike in the opposition decision, however, the Board of Appeal found that the evocation of a geographical indication applies whether or not the products and services are comparable. As a result, the Board found the sign ‘Champagnola’ to be an evocation of the term Champagne.
• Exploitation of reputation: The Board discussed that, in the case of an opposition based on a PDO enjoying a certain level of reputation, third-party exploitation of that reputation does not have to have already taken place. In other words, the holder of the prior right – the PDO Champagne in this case – does not have to prove past or current damage, but instead future risk (so long as not purely hypothetical), in view of usual practice in the commercial sector concerned. Here, the application concerns products and services related to breakfast (food and bakery services) and, as the Board points out, Champagne is a product that can be consumed at breakfast, meaning the consumer may think that there is a link between these products and Champagne wine.

Although the designated products and services covered by the ‘Champagnola’ are not considered to be similar to Champagne wine, the Board of Appeal still found that the registration exploits the reputation of the PDO. As a result, it annulled the opposition decision and refused the application.

This decision is similar to that made by the French IP Office (INPI) in the dispute over ‘Levain de Champagne’ (summary in French available here).

Manon Brodin is a Trademark Attorney at Novagraaf. She is based in Bordeaux.