Facts

The US financial and digital payments company, Square Inc, applied to register, as an international registration designating the EU, the following figurative sign in Class 36 for “Electronic transfer of financial instruments for others”:

The EUIPO Examiner rejected the application on the basis that it lacked distinctive character and was descriptive of the services claimed under Articles 7(1)(b) and (c) of the Trade Mark Regulation (2017/1001/EU).

The First Board of Appeal dismissed Square’s appeal on the basis of Article 7(1)(b). Square appealed to the General Court.

Decision

The GC rejected Square’s argument alleging infringement by the BoA of essential procedural requirements. The GC said that, in essence, the BoA had found that, although the relevant public would perceive the mark as an indication of the services offered, i.e., cash transfers by means of an app, the mark was not capable of distinguishing the services offered from those of another origin. The GC inferred that, in essence, the BoA had found that the relevant public would not likely perceive the mark as indicating the commercial origin of those financial services. Therefore, contrary to Square’s allegations, the BoA had not simply inferred a lack of distinctive character of the mark under Article 7(1)(b) from its descriptive character under Article 7(1)(c) but had rightly conducted an independent analysis of the absolute ground for refusal under Article 7(1)(b).

The GC also rejected Square’s complaint that the BoA had infringed its right to be heard. Square said that the Examiner had rejected the application primarily on the basis of Article 7(1)(c), whereas the BoA had dismissed the appeal solely on the basis of Article 7(1)(b), on which Square had not had the opportunity to be heard. The GC held that, in fact, the Examiner’s decision had been based on both Article 7(1)(b) and Article 7(1)(c). Therefore, given that Article 7(1)(b) had been an integral part of both the Examiner’s and the BoA’s decisions, it had been open to Square to challenge the Examiner’s assessment of the lack of distinctive character in its appeal.

Square also submitted that the BoA had infringed Article 7(1)(b) by: (i) not assessing the distinctive character of the application mark in relation to the particular services concerned; (ii) erring in its definition of the relevant public; (iii) not correctly assessing the distinctive character of the application mark; and (iv) wrongly broadening the criteria for assessing the distinctive character of the application mark.

The GC rejected the first allegation, finding that the BoA had expressly referred to the nature and intended purpose of the services in question. Further, it had assessed the distinctive character of the mark specifically by reference to the services claimed, saying that the relevant public would perceive the mark “as an indication … that the service is offered by means of an app that transfers cash, i.e. money” and concluding that the mark was not capable of distinguishing, in the eyes of the relevant public, the services concerned from those of another origin.

As for the second allegation, the GC noted that the BoA had found the relevant public to be “consumers, both professional and non-professional, throughout the EU”, to the extent that the services had a financial nature, and that English was broadly used in IT and finance.

Square said that the BoA should have considered the English-speaking public only, since the mark was composed of English words. It said that by including consumers from other countries, the BoA had erroneously broadened the scope of the relevant public and had therefore incorrectly assessed how the public would perceive the mark.

The GC noted that under Article 7(2) of the 2017 Regulation, an absolute ground for refusal in part of the EU is enough to justify refusal of registration. That also applied to international registrations designating the EU. Accordingly, it was sufficient that the mark be devoid of distinctive character, at least for the relevant English-speaking public, for registration to be refused. Even if the BoA had erred by considering how the mark would be understood throughout the EU, rather than just the English-speaking public, that would not have affected the outcome.

As for its third allegation, Square argued that the BoA had erred by not assessing the distinctiveness of the mark as a whole and instead analysing each of its elements individually. Square also said that its assessment of the individual elements had been flawed.

The GC said that when assessing distinctive character, the overall impression of the mark must be considered, but this did not mean that the individual features of the mark could not first be examined, as the BoA had done, finding that each element, taken separately, was devoid of any distinctive character.

The GC agreed with the BoA that a square with rounded corners was not an unusual element and would not prevent consumers from associating it with the geometric figure of a square. It also agreed that the colour green, in association with the “$” symbol, evoked a general connection with finance, since green is the colour of US dollar banknotes and is associated with the idea of wealth. Further, the GC agreed with the BoA that, although the “$” sign in the mark was not an exact reproduction of the dollar sign, the relevant public would associate it with the dollar symbol, especially because of the inclusion of the words “cash app”. The GC also agreed that the public would perceive the sign as a mobile app icon used to transfer money and therefore as a characteristic of the financial services in question and not as a reference to the commercial origin of those services.

The GC found that, having examined each element separately, the BoA had then gone on to carry out an overall assessment of the distinctive character of the mark, finding that the relevant public, which was familiar with financial transfers over the internet, would perceive the mark, “as a whole”, as an indication that the services concerned were being offered by means of an app for transferring money. Accordingly, the BoA had not inferred a lack of distinctive character solely from the fact that each of the mark’s components, taken separately, was devoid of any distinctive character, but had relied on the overall perception of the mark by the relevant public in relation to the services concerned.

Finally, on the fourth allegation, the GC upheld the BoA’s finding that the mark was capable of indicating the content or purpose of the services claimed, all of which related to the financial sector, but was incapable of performing the essential function of a trade mark, namely that of identifying the commercial origin of the services.

The appeal was dismissed. (Case T-211/20 Square, Inc v EUIPO EU:T:2021:712 (20 October 2021) — to read the judgment in full, click here).

The GC also dismissed Square’s appeal in relation to its application to register the same figurative sign as an international registration designating the EU, this time in Class 9 for: “Downloadable software for enabling the transfer of financial instruments; downloadable software for providing discounts on products and services; downloadable software to enable transactions of value to be requested from or sent to others”. The GC found, again, that the BoA had not erred in finding that the mark would be perceived by the relevant public as indicating that the downloadable software made it possible to transfer or to obtain cash as a result of a financial transaction, and not as an indication of the commercial origin of those goods. The BoA had therefore been correct to conclude that the mark lacked any distinctive character within the meaning of Article 7(1)(b). (Case T-210/20 Square, Inc v EUIPO EU:T:2021:711 (20 October 2021) — to read the judgment in full, click here).