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US and Czech companies can both use Budweiser mark, ECJ rules

23 September 2011

US spirit giant Anheuser-Busch and Czech brewer Budějovický Budvar will both be able to continue to use the Budweiser trademark in the United Kingdom after a European court ruling last week.

Adjudicating in one of the many protracted disputes between the two companies the European Court of Justice ruled in case C-482/09 that British consumers were sufficiently aware of the difference between Budvar’s and Anheuser-Busch’s beers that the use by both of the same trademark would not cause any confusion.

Both Budvar and Anheuser-Busch have used the word ‘Budweiser’ to market their beers in the UK for more than 30 years, with the former entering the market in 1973, followed by Anheuser-Busch in 1974.

Anheuser-Busch was the first to apply for registration of the name as a trademark in Britain in 1979.

While the US company’s application was still being examined, Budvar applied for registration of the same Budweiser name and sign in 1989.

In February 2000, the High Court ruled that both companies should be allowed to register the word Budweiser.

Under the EU’s trademark directive, registration will not be granted or will be declared invalid if the trademark is identical with an earlier trademark covering the same goods or services.

The directive provides for an exception where the owner of the earlier trademark was aware of the use of the identical later trademark and has allowed it for five years.

In this case, the owner of the earlier trademark will not be able to ask the later trademark to be declared invalid or oppose its use.

Four years and 364 days after Budvar and Anheuser-Busch registered the Budweiser trademark, Anheuser-Busch lodged an application with the UK’s trademark registry for a declaration that Budvar’s registration was invalid.

The Luxembourg judges said a trademark could be considered to be earlier without having been registered if it was “well known”.

They also held that a later registered trademark could only be declared invalid if it had or was liable to have an adverse effect on the essential function of the earlier trademark, that is, to guarantee to consumers the origin of the goods covered.

In the circumstances, the court said, both companies had been using the same mark in good faith concurrently for more than 30 years before registration but consumers were aware that their products were different.

“Consumers are well aware of the difference between Budvar’s beers and those of Anheuser-Busch, since their tastes, prices and get-ups have always been different,” the judges said. “Even though the trademarks are identical, the beers of Anheuser-Busch and Budvar are clearly identifiable as being produced by different companies.”

As a result, Budvar’s registration in the UK of the later Budweiser mark need not be declared invalid.

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