HERMES INTERNATIONAL, a French luxury fashion house, is in a legal battle to register its iconic packaging colors, orange and brown, as a color mark in Japan.
Color mark of Hermes box
On October 25, 2018, HERMES INTERNATIONAL filed a trademark application for its iconic packaging colors, orange and brown (see below), as a color mark to be used on various goods in class 3, 14, 16, 18, and retail services in class 35 with the Japan Patent Office (JPO) [TM application no. 2018-133223].
Article 3(1)(iii) and 3(1)(vi)
The JPO examiner rejected the color mark under Article 3(1)(iii) and 3(1)(vi) of the Japan Trademark Law by stating that colors per se are unlikely to play a role in source indicator because they are frequently aimed to attract consumers in association with function or quality of goods and services. Because of it, relevant consumers at the sight of goods or services bearing the applied color would not see the combination of colors, orange and brown, as a source indicator.
Hermes argued acquired distinctiveness of the color combination as a result of substantial use on Hermes box for the past six decades from the 1960s onward.
A bottleneck is that the Hermes box contains its name “HERMES” and horse and carriage logo as a conspicuous source indicator. Hermes conducted market research to demonstrate the acquired distinctiveness of the packaging color per se. The research targeted high-income men and women in their 30s to 50s with incomes JPY10,000,000 and above. According to the research report, 36.9% of the interviewees answered Hermes when shown three boxes in different shapes with the color mark. 43.1% chose Hermes from ten options.
The JPO examiner did not find the research persuasive to support acquired distinctiveness among relevant consumers of the goods and services in question.
The examiner stated the relevant consumers shall not be limited to the high-income class. Besides, even among high-income consumers, more than half of them did not link the color to Hermes. From the research, it is doubtful if relevant consumers would conceive the color per se as a source indicator.
Based on the above findings, the examiner totally rejected the applied color mark under Article 3(1)(iii) and (vi) on July 9, 2021.
HERMES INTERNATIONAL filed an appeal against the rejection on October 8, 2021.
Japan opened the gate to Non-Traditional trademark, namely, color, sound, position, motion, hologram, in April 2015. It seems true that, beyond expectation, JPO has a significantly high hurdle to clear.
543 applications for color marks were filed with the Japan Patent Office (JPO) as of now (Nov 15, 2020). Among them, only 8 color marks are allowed for registration.
1. Tombow Pencil “MONO” (stationery)
2. Seven-Eleven (convenience store)
3. Sumitomo Mitsui Financial Group
4. Sumitomo Mitsui Financial Group
5. Mitsubishi Pencil “UNI” (pencil)
6. Mitsubishi Pencil “HI-UNI” (pencil)
7. Family Mart (convenience store)
8. UCC Ueshima Coffee (canned coffee)
All the registered color marks consist of more than two colors. JPO has yet to register a single case of color per se.
Most single-color marks are rejected due to a lack of distinctiveness and failure to demonstrate acquired distinctiveness. Surprisingly, 492 applications (90.6%) are already rejected or voluntarily withdrawn by the applicant.
Red Bull was unsuccessful in registering a combination of dark blue and silver on energy drinks in class 32.
Hermes also failed to register a three-color combination over various goods in class 14, 18, and 25.
43 applications are in review with the JPO as of now. Remarkably, Christian Louboutin fights for the appeal against the refusal of its iconic red-sole.
On 23 June 2020, the Japan IP High Court decided a case concerning a single color mark that was rejected for registration by the Appeal Board of the Japan Patent Office (“JPO”).
Single Color Mark
On 1 April 2015, Hitachi Construction Machinery (“Hitachi”) filed an application for trademark registration with JPO consisting of a single color per se, namely orange (Munsell: 0.5YR5.6/11.2) over the goods of hydraulic excavators, wheel loaders, road loaders, loaders [earch moving machines] in class 7, and rigid dump trucks in class 12 (TM Application no. 2015-29999).
By the decision of 19 September 2019, the Appeal
Board of JPO declared the applied color mark to be refused in contravention of Article
3(1)(iii) and Article 3(2) of the Trademark Law, finding that the
graphic representation of the color mark constituted the “mere single orange
color, without contours”. If so, the mark is not inherently distinctive
and it is lacking acquired distinctiveness. In the course of the appeal trial,
Hitachi amended and restricted the designated goods to “hydraulic excavators”.
Article 3(2) is a provision to allow registration of any mark with which the relevant public will associate a particular source, manufacturer, or producer over time through the trademark owner’s usage.
On 30 October 2019, Hitachi appealed
against the JPO decision.
IP High Court decision
At the outset, the court stated it is inevitable
on the case concerning single color mark to take the interest of competitors who
deal with the goods in question into consideration since allowing one trader to
exclusively use this color would likely to cause unjust competitive practice in
form of monopolistic power of use in favor of one trader only.
From the produced evidence, Hitachi has allegedly used the color in question on hydraulic excavators and other construction machines since 1974.
Hitachi consecutively holds a 20% market share (14.6%) of hydraulic excavators over the past four decades in Japan. The research showed that approx. 95.9 % (185 out of 193) of traders in the construction industry were able to associate the color with Hitachi.
In the meantime, several competitors use similar color on hydraulic excavators
In the decision, the court found orange color is one of the colors commonly seen in our daily life. Besides, the Japan Industrial Standard (JIS) adopts orange as a safety sign-color aiming to prevent harm to the human body and damage to properties. Because of it, at construction sites, we often see several items colored in orange, e.g. helmets, rain suits, guard fens, work clothes, tower cranes, construction vehicles.
Hitachi Hydraulic Excavators have other colors, in fact, namely, a house mark “HITACHI” colored in white, buckets (attachments), cockpits, and crawlers colored in black. If so, the applied mark shall be capable of playing the role of source indicator in combination with these. Thus, the court would not find reasonable grounds to believe that the orange color per se acquired distinctiveness as a source indicator of Hitachi’s Hydraulic Excavators.
The court even suspected credibility of the research by finding that it narrowly targeted traders or consumers who own more than 10 hydraulic excavators, precisely it showed 36.8% in light of initial research number of targets, 502 persons, and the questionnaire ‘Please answer. What maker do you think hydraulic excavator is?” was insufficient to conclude acquired distinctiveness since its answer may simply suggest one of the colors of Hitachi’s Hydraulic Excavators.
Even if hydraulic excavators market in Japan is an oligopoly with five makers accounting for 90 % of the industry share, and the orange color has been consecutively used by Hitachi only, it does not mean every competitor agreed to refrain from using the color given orange has been used on various goods in the construction and agriculture industry in general.
Based on the foregoing, the court affirmed the JPO decision and dismissed Hitachi’s allegations in contravention of Article 3(1)(iii) and 3(2).
Thus, it is obvious that a very high standard of distinctiveness needs to be attached to a single-color mark if the same has to be claimed for trademark protection.
This case was a second court decision concerning a single color mark. The first case, Reiwa1(Gyo-ke)10119 ruled on March 11, 2020, also ended with the rejection of a single orange color mark in contravention of other ground, Article 3(1)(vi).
How JPO Examines Color Marks
As of now (12 July 2020), 543 color marks were applied for registration with JPO since the commencement of the Non-Traditional trademark application in April 2015. So far, only 8 marks are successfully registered. See below.
In sum, the registration rate of color mark is barely 1.5%! It is noteworthy none of a ‘single’ color mark has been granted to registration.