Evergreening: Is it really a case of use it or lose it?

By Chris Brand & Lara Wessels on 6 May 2024

Our previous blog post, which concerned two UK supermarket giants, Lidl and Tesco (https://swart.law/post.aspx?id=112), highlighted a strategy that appears quite often in practice in respect of United Kingdom and European Union trade marks; namely that of 'evergreening'.

As a point of departure, trade mark registrations can effectively last in perpetuity, provided renewal fees are paid and the trade mark is adequately maintained. However, the mere renewal of an existing trade mark registration does not address all possible vulnerabilities. It is incumbent upon the proprietor of a trade mark to ensure that it also makes continuous and uninterrupted use of the mark for the goods or services for which the trade mark is registered, and in predominantly the form in which the mark was registered. That being said, the practice of 'evergreening' serves to address this risk (in part).  

'Evergreening' concerns the practice or legal strategy whereby an applicant re-files an identical existing trade mark to avoid a possible attack from an interested party concerning the non-use of such trade mark. A registered trade mark only becomes vulnerable to attack on the basis of non-use, after a period of 5 (five) years have passed since the registration date (i.e., the grace period), and where no actual use has been made of the trade mark.

The practice of evergreening provides two key benefits:

  1. The trade mark owner need not, in theory, ever have to tender evidence of its use, or intention to use the trade mark; and
  2. The trade mark owner may enforce their rights against third parties using similar or identical trade marks, despite not even using the mark themselves.

While the practice of evergreening is not, per se, prohibited, previous and more recent decisions in the European Union and the United Kingdom have revealed some risks and vulnerabilities in this strategy. 

Hasbro Inc v European Union Intellectual Property Office 

In the case of Hasbro, Inc v European Intellectual Property Office T-663/19. The Court found that refiling a trade mark in order to take advantage of the five-year grace period before having to prove use can be considered bad faith. Hasbro had attempted to file a subsequent identical application for the registration of their MONOPOLY trade mark, however, the EU court found such tactic to be a clear intention to take advantage of the European Union trade mark system. As a result, the subsequent filing was partially invalidated. 
More recently, the practice of evergreening and bad faith filings were addressed on appeal before the United Kingdom Court of Appeal in the case of Lidl v Tesco.

Lidl v Tesco: United Kingdom Court of Appeal

In the recent case of Lidl v Tesco, the factual background which can be found in our previous blog post (https://swart.law/post.aspx?id=112), the Court of first instance had to consider whether the identical wordless device marks, consisting of a yellow circle with a red border, set on a blue square, filed in 1995, 2002, 2005, 2007, and 2021, were filed in bad faith. 

The Court of Appeal upheld the Court of first instance's decision that the marks filed in 1995, 2002, 2005, and 2007, were filed in bad faith and that they be removed. The marks all featured the same specifications, were filed in regular intervals, and were filed in order to avoid a potential non-use revocation attack. 

The Court of Appeal further upheld the Court of first instance's decision by confirming that the wordless device mark, filed in 2021, was filed in good faith and, therefore, not vulnerable to be removed on the basis of a bad faith filing. In support of its finding, the Court of Appeal stated that the 2021 registration was filed with additional specification terms and was filed some 14 years after the previous application. 

In considering the burden of proof, a point fiercely contested by Lidl in defence of the revocation of its wordless device marks, the Court of Appeal stated that although a person is presumed to have acted in good faith when filing a trade mark application, where the objective circumstances give rise to a prima facie case of bad faith, the evidential burden shifts to the applicant to explain his intentions. 

It also did not help Lidl's case that they were unable to provide any evidence to show their (true) intention to use the respective marks on each of the filing dates, a point which plays a large role in South Africa.

The South African position

In South Africa, the applicant for registration of a trade mark must on the date an application is filed, either: 

  1. have a bona fide intention to use the mark for the goods and services applied for; or 
  2. have made actual use of the mark for the goods and services applied for. 

A registered trade mark may be expunged (cancelled) if: 

  1. the trade mark was registered without any bona fide intention to use the mark in respect of some or all of the goods and/or services for which the registration was obtained, and there has in fact been no use; or 
  2. for a continuous period of 5 (five) years or longer following the date of registration of the mark, no bona fide use has been made of the mark in respect of the goods and services for which the mark is registered. 

In these instances, the onus is on the proprietor to show relevant use of the mark. However, as to the intention to use, the onus will lie with the applicant for revocation, but may shift to the proprietor in circumstances similar to that of the Lidl v Tesco. Therefore, an absence of any evidence to support its defence will surely lead to invalidation of the trade mark registrations. The mechanism, therefore, proves quite powerful under South African law. 

The proof of use of a South African trade mark registration, or even an intention to use a trade mark in South Africa, may appear to be as crucial as that of a United Kingdom or European Union trade mark; perhaps even more so. 

In the case of Victoria's Secret Inc v Edgars Stores Ltd, the Court, in considering 'an intention to use the mark', stated that one must have an intention to use the trade mark in South Africa in the immediate future. In this instance, the Court considered the intention of Victoria's Secret to constitute a mere 'problematical intention based on an uncertain or indeterminate possibility', not a definite intention to use. 

In the case of Etraction (Pty) Ltd v Tyrecor (Pty) Ltd, in considering whether the proprietor of the mark had a bona fide intention to use it in relation to the goods in respect of which it was registered, the Court stated that one must consider the facts of each case, as they appear from the course of events leading up to the application for registration, to determine whether there was a genuine intention to use the mark in the course of trade in respect of those goods, or whether the registration was intended for an ulterior purpose. 

It is, therefore, imperative that a proprietor retain any and all evidence concerning use or, at the very least, an intention of use of a trade mark, for purposes of warding off any attack. 

Whether one can exploit a similar strategy to that of 'evergreening' employed in the United Kingdom and the European Union, in South Africa, is highly doubtful. Although similar marks with differentiating specifications, even identical specifications, may be possible, identical marks with identical specifications will not pass muster.  

Having regard to the various nuances in international trade mark systems is therefore essential when embarking on global brand expansion. Although the United Kingdom courts have observed evergreening to be an “abuse of the trade mark system” in certain circumstances, one can anticipate mechanisms to be put in place in the foreseeable future to combat this.

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Please note that our blog posts are informal commentaries on developments in the law as at the time of publication and not legal advice. You should place no reliance on our blog posts; we look forward to discussing your particular matter with you.