Rado Uhren AG (the Rado Watch Company) Fails to Stop Israel Company Registering Rado as Trademark for Shoes.

Rado

Rado Import and Marketing LTD filed the above mark for Clothing, footwear, headgear all in Class 25. The mark was allowed on 29 February 2012, and, perhaps unsurprisingly, Rado Uhren AG (the Rado Watch Company) opposed the registration.

Rado Uhren AG (the Rado Watch Company) claimed that the rights in the word mark RADO, including class 25, are exclusively associated with them. Under 24(1a)(1) of the Trademark Ordinance 1972, the Commissioner should prevent the mark in question from issuing. Grounds for the Opposition included that the Mark was confusingly similar to the Opposer’s marks which were well-known marks; registration of the mark was against the public order, and allowing the mark to register would mislead the public and allow unfair competition, under Sections 11(5), 11(6), 11(9) and 11(14). Furthermore, under Section 12 the mark was confusingly similar to Rado’s trading name and was applied for in bad faith.

The Opposer’s evidence was submitted as an Affidavit by Eli Holland, the CEO of Planet Time LTD which represents Rado in Israel.  Rado Import and Marketing LTD likewise filed an Affidavit of their CEO. Both parties attended a hearing before the Commissioner, and were cross examined. At the commissioner’s request, the parties submitted written summations.

Rado Uhren AG (the Rado Watch Company) is a leading watchmakers that was established in 1917 and which has a considerable worldwide reputation. Recently, the company has started selling clothing under the RADO brand, both in Israel and abroad, in a chain of Planet Time stores across the country.

Rado Uhren AG (the Rado Watch Company) has their own mark, TM 79906 in class 14 as follows:

Rado

They also have a further 5 marks in class 14 for different lines and models, RADO DIASTAR, RADO FLORENCE, RADO, RADO  D STAR and RADO JUBILE.

Rado Import and Marketing LTD was established in 1994 and claims to have spent hundreds of thousands of Shekels in advertising, and to have sold large numbers of shoes under the brand RADO in hundreds of stores, including leading Israel chain of department stores HaMashbir l’Zarchan, the Center for Orthopedic Shoes, Marco Shoes, and other retail outlets.

The Opposer, Rado Uhren AG, claims to have made continuous use of the RADO mark for decades and to enjoy an exclusive reputation in Israel and abroad for high quality watches.  Rado Uhren AG further claims that Rado Import and Marketing LTD intentionally copied their mark to benefit from the fruits of the mark’s reputation and usage of the mark was confusing to the public, particularly as the mark was virtually identical.

The Opposer considers that the marks look and sound the same, and that the additional R in the logo does not visually mitigate since the public has imperfect recall. The additional R would not generally be pronounced, as indeed, the CEO of Rado Import and Marketing LTD themselves pronounced the mark RADO and didn’t enunciate the additional R.

Rado Uhren AG claimed to be using the mark for clothing and not just watches and to have actually registered the mark for clothing in some jurisdictions. Rado Uhren submitted as evidence, a number of press releases, clips and catalogs from Israel and abroad., and footage from sports events which they had sponsored.

There were two suitcase designs, one cap and one shirt that included the RADO logo, but prior to the hearing were not yet on sale in Israel, but which Rado Uhren AG’s CEO indicated were to go on sale shortly. Rado Uhren AG’s products were available in 25 jurisdictions.

Rado Uhren AG claimed that there was a trend to sell watches and shoes together, under a common brand, and showed that Louis Vitton, Prada, Boss and Dior sold both shoes and watches under the same logo.

Rado Import and Marketing LTD countered that Rado Uhren AG’s claiming rights to the word RADO in the shoe category some 20 years after the mark being used by them for shoes, was, in itself, inequitable behavior. Since Rado Import and Marketing LTD had 20 years market presence in Shoe branding, after carefully building their reputation, the mark in Israel was identified with them.

 

The Ruling

Noting that the opposition was under Sections 11(5), 11(6), 11(9) and 11(14) of the Trademark Ordinance, the Commissioner examined each Section in turn.

Section 11(9) considers the likelihood of confusion between the requested mark and marks registered in the trademark register. Likelihood of Confusion is based on the triple test. In this instance, the marks sound the same, and, due to the dominance of the word, RADO, look the same as well.  As to the customer base, both companies market to the wider public and advertise widely. Both classes 14 and 25 are large classes. They are, however, different classes, nevertheless, one has to look into whether the classes are of the same type.

The Commissioner does not consider that watches and shoes are the same type of good. Even though they may be advertised in the same magazine, they are sold in different stores. Rado Uhren having Class 25 registrations abroad for shoes or cases does not help them as it is the local mark that is of interest.

As to other considerations, Rado Import and Marketing LTD claim that the name Rado should be pronounced Radu and is Arabic for desirable (similar to the Hebrew רצוי).  Although not convincing, The Commissioner was more impressed with the fact that the usage by Rado Import and Marketing LTD goes back 20 years, 10 of which with Rado Uhren AG’s knowledge.

The Commissioner concluded that there is no real likelihood of confusion as the goods are in different classes.

As to Section 11(14), which protects well-known marks, the law states that a mark that is identical or similar to a well known mark, even for different types of goods cannot be registered, if the mark indicates a connection between the goods and the well known mark is likely to be damaged by the registration.

The definition of a well-known mark is discussed in the Absolut vodka case (9191/03 V&S Spirit Altiebolag vs. Absolut Shoes LTD, 19 July 2004).

In deciding whether a mark is well-known in Israel, one has to consider the relevant populations and whether the notoriety is the result of marketing. Notoriety has to be local. See UB TM 93261 Pentax vs. Asahi Kogaku, the considerations for whether a mark is to be considered well known or not were listed as including: the notoriety of the mark, the amount of usage and the period under which the mark has been in use, publication, registration and enforcement, exclusivity, type of use and similarity of other marks by third parties. In this regard, acquired distinctiveness is considered better than inherent distinctiveness in showing reputation, type of goods and services, marketing channels and the extent to which the mark indicates the quality of the goods.

Both parties agree that Rado is a dominant player in the watch market, both in Israel and abroad. The word Rado appears not only on watches, but also on hats, shirts and bracelets which are, essentially, promotional items for marketing watches.

In Israel, Rado watches are available from a number of outlets, and, in 2011-2012, the income generated from Rado watches was 11 and 13 million shekels, respectively. In 2012, 2 million shekels was spent on advertising Rado watches in the media and on hoardings, including in the Hebrew, Russian and Arabic press. Furthermore, with caution, advertising abroad, such as sponsoring the US Champion Tennis Tournament in 2011 and the Kremlin Cup in 2012, and other cultural events, has an impact on the reputation of Rado watches in Israel. This leads to the conclusion that Rado is a well-known mark in the watch population.

Although Rado Import and Marketing LTD’s products are not in the same class, well-known marks can block registration in other classes. Here the considerations are whether one would assume a connection and whether the famous mark owner would be likely to be damaged.

Judge Berliner in Unilever referred to Judge Rubinstein in Absolut and ruled that

“damage to reputation is not far from misleading but is not identical to it. The Legislator differentiates. It is easier to damage reputation than to mislead, but there is still a need for the customer to see a connection, and to cause damage, one needs a real basis for this”

In this instance, the Commissioner ruled that the Opposer has not shown that the sale of shoes under the brand Rado has done them damage, and again noted that they had knowingly lived with the Rado shoes for 10 years.

The Commissioner does not see that the public would assume an association.

As far as Section 11(6) ”passing off” is concerned, the Commissioner considered that Rado had failed to prove that there had been an attempt to ‘free ride’ on the reputation of Rado watches, and so there are no grounds to cancel the mark under this clause.

The Opposer did not themselves relate to Sections 11(5) and 12 in their summaries and the Commissioner therefore felt equally able to ignore these grounds.

The Opposer wished to submit some late evidence including Facebook pages where the Applicant was using the word RADO without the additional R, but the Commissioner did not see that these would change his ruling.

In light of the above analysis, Adv. Kling ruled that the mark could be registered and, after weighing up the evidence, ruled 5000 NIS in legal costs and 20,000 in lawyers fees.

Re 244357 Rado, Adv. Assa Kling, 29 June 2015.

COMMENT

I am unhappy about this ruling, and the recently reported Coveri case, since Rado is a well-known mark that is at least being diluted. The argument that Opposer did nothing to prevent the word Rado being used for selling shoes for ten years has some validity but we note that Eden Spring’s use of the word Champagne in a marketing slogan was considered illegal and there the court did not find that the Comite Interprofessionnel du vin de Champagne (CIVC) were tardy in bringing their complaint.

Shoes and watches are not the same, but Rado is a made-up word. Not speaking Arabic I can’t comment on the Rado-Radu explanation, but I note that the word virgin is generic for olive oil, and the Israel Patent and Trademark Office nevertheless found in favour of Richard Branson’s Virgin Enterprises where an enterprising person sold candles made from solidified olive oil as virgin candles.

It seems to me that despite not acting against the shoe retailer, Rado Watches should, based on these precedents, be able to prevent the R-Rado trademark from being registered.  If the word Rado to be pronounced Radu means desirable in Arabic, that is additional grounds for the patent office to consider the mark Laudatory and thus non-registerable.

As an aside, when we got married twenty years ago, Miri and I received matching His & Hers watches (paid for by our respective in-laws). Certainly 20 years ago Rado was considered a high-quality watch. Our models were at the cheaper end of the range. I actually had nothing but trouble with mine (I call this the Geller effect. My cheaper current Seiko watch has disappeared a few days ago – I call that the Houdini effect. My wife calls it clutter).  It is certainly true that the company took repairs seriously. I never had a problem having it repaired. I eventually got fed up and no longer wear it.

As I see it, using Rado for shoes is rather like someone randomly choosing the name Rolls Royce or Ferrari as a brand, and should be treated as such.

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