On February 24, 2021, Taiwan’s IP Court partially vacated IP Office’s determination in opposition proceeding involving “ZARA” v.s “SARACARES”, finding registration of “SARACARES” for use in stationery products (class 16) and advertising and rental services (class 35) would not cause confusion with the famous apparel brand “ZARA”.
The contested trademark, “SARACARES”, was filed on February 14, 2017, designated for use in class 16 (for stationery such as notebook, envelope, cards, etc.), class 35 (for various services including advertising, computer database management, business consultation, department store, supermarket, market research, online shopping, retail and wholesale service for apparel and accessories, accounting, rental service, etc. ) and class 36 (for various financial services including insurance, real estate, banking, security transaction, etc.).
Application for “SARACARES” was granted on October 16, 2017 (Reg. No. 01876420, see below). Industria De Diseno Textil, S.A. (“INDITEX”), registrant of “ZARA” trademarks in Taiwan, filed opposition on January 15, 2018, arguing that the registration of “SARACARES” would cause confusion with its “ZARA” trademarks that were also applied for use in class 16 and class 35.
On July 14, 2020, Taiwan’s IP Office sided partially with INDITEX, finding “SARACARES” similar with “ZARA”, and would cause confusion with INDITEX’s “ZARA” trademarks because they were applied for use in similar goods (class 16), and services (class 35). Thus, all the designated goods in class 16 and the majority of designated services in class 35 were cancelled by the IP Office. The Appeal Board affirmed the finding of IP Office, so the case was further appealed to the IP Court.
The IP Court narrowed down the exclusivity of INDITEX’s “ZARA” trademark right by vacating part of IP Office’s finding, based on the following reasons:
1. Although the contested “SARACARES” and the cited “ZARA” trademark series (Reg. No. 01406674, 01345421, 01595432, 01520397, 01535369 see below) share similar initial letters (i.e., SARA v. ZARA), the IP Court found there is still visual difference between the two trademarks, which renders the degree of similarity not as high as was claimed by INDITEX.
2. The IP Court noted that the cited “ZARA” trademark series are also designated for use in class 16 (stationery products like pen, stickers, stapler, etc.) and class 35 (department store, business consultation, online shopping, vending machine rental, and advertising service), which are similar with the products and services designated by “SARACARES”. However, the IP Court also noted that while “ZARA” as a trademark is well-known in apparel products, there is little evidence of actual use for the products or services designated under class 16 and class 35 in Taiwan. In other words, even though ZARA has registered series of trademarks, such as “ZARA HOME” and “ZARA FOR MUM”, for use in various products and services other than apparel and home accessories, there is no evidence showing these trademarks have actually been put in use in Taiwan. Thus, the IP Court was not persuaded that ZARA’s brand and business is as diversified as claimed by INDITEX in Taiwan.
3. As to actual confusion, based on the records, the IP Court found the contested “SARACARES” is used in providing online insurance service, which is so different and distant from apparel and clothing business. Therefore, the IP Court was of the view that it is less likely for consumers to be confused due to the co-existence of the two trademarks.
4. Further, since the applicant of “SARACARES”, Law Insurance Broker Co. Ltd., is a reputable company specializing in insurance service, and is not INDITEX’s competitor in the same type of clothing business, the IP Court found it unreasonable to infer that the filing for “SARACARES” was based on applicant’s bad faith or intent to imitate.
5. In view of the above, among the services designated by “SARACARES” in class 35, the IP court found the retail and wholesale services for the apparel products might cause confusion with the famous “ZARA” trademarks, because consumers may misconceive that “SARACARES” belongs to the same “ZARA” trademark series. The IP court affirmed the IP Office’s finding in this respect.
6. As for products and services that are not related to clothing, such as stationery, advertising and rental service, the IP Court determined that the likelihood of confusion caused by “SARACARES” should be balanced by the fact that its similarity with “ZARA” is not high, that “ZARA” as a trademark in Taiwan is well-known in apparel products but is rarely used in other type of goods, that there is little likelihood of confusion because of the difference of industries, and that the contested trademark was not filed out of bad faith. As such, the registration of “SARACARES” for goods in class 16 and rental and advertising services in class 35 should not be found violating Trademark Law.
Source:
IP Office’s decision:
IP Court’s decision:
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