Nike is facing the latest bout of legal pushback in its ongoing quest to amass trademark registrations for the word FOOTWARE for use on hardware/software that could be tied to sneakers. In a decision on Wednesday, the General Court for the European Union upheld an earlier determination from the Board of Appeal for the European Union Intellectual Property Office (“EUIPO”), which found that the registration that was granted to Nike back in 2019 for the FOOTWARE word mark is invalid because the mark is “descriptive” when used in connection with the goods and services identified in Nike’s registration.
The General Court’s decision follows from invalidation proceedings initiated by Puma, which filed an application for a declaration of invalidity of Nike’s FOOTWARE registration with EUIPO in March 2020. Fast forward to January 2023 and the EUIPO’s Fifth Board of Appeal sided with Puma, finding that Nike’s mark is “descriptive with regard to the goods and services at issue.” One of the key bases for the Board’s determination: Its review of “evidence submitted in the course of the proceedings before EUIPO” that led it to concluded that, “at the relevant date, the relevant English-speaking public could perceive the FOOTWARE [mark] as a specific and direct reference to the kind or intended purpose of the goods and services covered by the mark, namely that they were broadly adapted for use for footwear.”
At the same time, the Board similarly determined that the “relevant public” – namely, “average consumers and the professional public” with a level of attention that “could vary from average to high” – was likely to “perceive the sign FOOTWARE as meaning ‘footwear,’” furthering bolstering its “descriptiveness” decision.
Dissatisfied with the Board’s determination, Nike lodged an appeal with the General Court, which sided with the EUIPO (and Puma, indirectly) in its June 12 decision. Among other things, Nike took issue in its appeal with how the Board defined “footware.” In particular, counsel for Nike alleged that the Board incorrectly limited its analysis of whether the mark is descriptive to whether the relevant English-speaking public which would perceive the mark as the equivalent of the word “footwear” either because “it might perceive it as a misspelling of that term or because it might perceive it directly as ‘footwear.’” Nike argued that the Board should have analyzed “other possible meanings of the contested mark, which would have led it to find that that mark was not descriptive.”
Unpersuaded, the General Court cited EU case law, including the outcome in OHIM v Wrigley, which mandates that a trademark “must be refused registration if at least one of its possible meanings designates a characteristic of the goods or services concerned.” As such, the court held that the Board “was entitled to base its assessment solely on the part of the relevant English-speaking public” that would perceive Nike’s mark to mean “footwear.”
The court similarly shot down Nike’s claim that the Board erred in finding that the term “footware” was descriptive of the goods and services in Nike’s registration on the basis that it “did not correctly determine what constitutes a relevant characteristic of the specific goods and services at issue for the purposes of Article 7(1)(c) of Regulation 2017/1001.” (Article 7(1)(c) prohibits the registration of that marks “consist exclusively of signs or indications which may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods or of rendering of the service, or other characteristics of the goods or service.)
In order for a registration to be barred by Article 7(1)(c), the General Court stated that “there must be a sufficiently direct and specific relationship between the [mark] and the goods or services in question to enable the relevant public to immediately perceive … a description of the goods and services in question or of one of their characteristics.” The Board of Appeal found that such a relationship exists in the case at hand and thus, that the relevant public “could perceive” the Nike “FOOTWARE” trademark as “a specific and direct reference to the kind or intended purpose of the goods and services in Classes 9, 38 and 42 “since those goods and services were broadly adapted for use for footwear.”
In support of that finding, the Board stated that the evidence submitted by the EUIPO “showed that, as of the date of [Nike’s] application for registration, footwear incorporating software or hardware constituted an established product on the growing market of the Internet of Things.” Moreover, the Board found that the evidence “contained several references to ‘smart shoes’ produced mainly by various competitors in the sports footwear sector, which included … ‘a computer inside a shoe’, wireless connectivity and embedded chips with tracking technology connected to a specific application.”
With the foregoing in mind, the General Court upheld the Board’s cancellation of Nike’s registration and dismissed Nike’s appeal, a decision that the Swoosh can (and might) now appeal to the EU’s highest court.
Mixed Proceedings in the U.S., UK
Hardly Nike’s first fight over its FOOTWARE mark, the sportswear titan lost in an opposition centering on its attempt to register the term FOOTWARE as a trademark for use in connection with the same goods/services early this year. In a non-precedential opinion in February, as first reported by TFL, a panel of Administrative Trademark Judges for the Trademark Trial and Appeal Board upheld Puma’s stateside bid to block the registration of Nike’s mark on the basis that it is “merely descriptive and not capable of acquiring distinctiveness.” Nike abandoned that specific application for registration in April.
In that matter, as in others, Puma argued that FOOTWARE does not function as a trademark, as it is an “obvious combination” of the words “footwear” and “hardware” or “software,” and as a result, it merely informs consumers that the goods/services at play relate to footwear-specific hardware/software, instead of indicating their source.
Meanwhile, the parties have also faced off in the United Kingdom. In May 2021, the High Court in London sided with Nike, finding that the UK Intellectual Property Office (“UKIPO”) did not err when it gave the greenlight to Nike’s FOOTWEAR application for registration. The mark was subsequently registered by the UKIPO in May 2022.
The case is Nike Innovate CV v. EUIPO, T-130/23 (EU Gen. Ct.)
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