Malaysia – Intellectual Property Update.

Taken for Granted: How McDonald’s Lost Its Most Beloved Trademark "BIG MAC"

The European Union Intellectual Property Office ("EUIPO"), in a bold approach of applying the "use it or lose it" principle, revoked McDonald’s registered trademark, BIG MAC, in its entirety on the ground that the mark has not been genuinely used.

Supermac, an Irish upstart burger chain, filed an application under Article 58(1)(a) of the EU Trade Mark Regulation, requesting a revocation of the trademark on grounds that the mark have not been put to genuine use for a continuous period of five years, from 2012-2017.

At the start of its decision, the EUIPO reminded that in a revocation proceeding on the basis of non-use, the burden of proof lies with the trademark proprietor as the applicant cannot be expected to prove a negative fact, which is, that the mark has not been used during a continuous period of five years.

Therefore, it is the trademark owner who must prove genuine use within the European Union, or submit proper reasons for non-use.

McDonald’s, in its attempt to defend its mark, has submitted the following documents before the EUIPO.

 

 

The EUIPO’s response to the affidavits submitted by McDonald’s is that statements made by the interested parties  themselves are generally given less probative value as that of independent evidence.

This is because the perceptions of a party involved in a dispute may be more or less affected by its personal interests in the matter. However, this does not mean that such statements do not have any probative value at all.

As for the packaging materials and brochures bearing the mark, the EUIPO held there is no information provided about how those brochures were circulated, who they were offered to, and whether they have led to any potential or actual purchases. Further, no independent evidence was submitted that could show how many of the products for which the packaging was used (if that is the case) were actually offered for sale or sold.

With reference to the printouts of the proprietor’s web pages with images of the sandwiches but without the prices, it could not be concluded whether, or how, a purchase could be made or an order could be placed. Whilst the websites provided such an option, no information of a single order being placed was provided. Therefore, a connection between the trademark proprietor’s websites and the eventual number of items offered sold could not be established.

Taking into account the evidence as a whole, the EUIPO concluded that the documents submitted by McDonald’s lacked probative value in that there is no conclusive proof that the products bearing the trademark are actually offered for sale, as there is no confirmation of any commercial transactions, either online or via brick-and-mortar operations. It is up to the EUTM proprietor to show such use in a manner which allows a reasoned conclusion to be made that the use is not merely token.

Interestingly, the EUIPO commented that the finding of no genuine use of the trademark is not due to an “excessively” high standard of proof, but to the fact that the McDonald’s chose to restrict the evidence submitted. McDonald’s has filed an appeal to the decision.

The unpredictable decision has taken the confident McDonald’s by surprise not only because it has lost its bid to a small fast food chain but more so due to the undeniable notoriety of its trademark in the EU and elsewhere. It serves as a harsh lesson that non-use revocation/cancellation proceedings are not to be taken lightly and ownership of a registered mark is not to be taken for granted; trademark owners are expected to earn ownership of their trademarks.

What could have been a straightforward tackle by McDonald’s has now become its most embarrassing defeat. Whilst the decision only applies to the European Union jurisdiction, it is only a matter of time that national courts elsewhere adopt a similar stricter approach on trademark owners especially multinational companies to keep them in check in relation to the use of their trademarks; an approach that is most welcomed.

Myanmar

Myanmar is undergoing significant and fundamental changes to the framework of IP trademark law pursuant to the signing of Myanmar’s Trademark Bill by the Myanmar President on 30 January 2019.

Previously, Myanmar had no legislation overseeing trademarks. With the implementation of the new law, Myanmar will be replacing its First-to-Use system with the First-To-File system and as such trademark owners will be required to re-register all existing trademarks as there will be no automatic carry-over of registrations. 

Further, Declarations of Ownership for existing registrations and any evidence of use can be submitted and will be considered during assessment of re-registration of applications. Further information will be provided nearing the enforcement of the legislation.

Brexit and the UK

The UK has accepted the EU’s offer of a Brexit extension until 31 October 2019 which amplifies a possibility that the UK will not be left with a no-deal exit from the EU.

In preparation for Brexit, the UK Government has set up statutory instruments to ensure rights accrued from all existing registered EU trademarks ("EUTMs") and registered European Community designs ("RCDs") will be enforceable in the UK on the day of exit, irrespective of a deal or no deal exit.

This is done by creating an automatic equivalent UK-registered trademark or registered design which will be enforced on the day of exit at no further cost to the IP owner.

For EUTM or RCD applications that are still pending on the date of exit, the applicant has nine months from the date of exit to instruct filing of a new UK trademark or design application equivalent to the parent EUTM or RCD application and will be entitled to claim the same filing date as that of the EUTM or RCD application. However, this will involve payment as set out by UK Registry.