Apple v. Smapple – Did the Japanese Patent Board Open the Floodgates by Weakening Trademark Protection In Japan?

By: Akash Anurag & Raja Reeshav Roy


INTRODUCTION

In a recent instance, the Japanese Patent Board (hereinafter ‘Board’) dismissed a trademark opposition claim against the registered trademark ‘Smapple’ on the grounds of less likelihood of confusion with Apple. The opposed mark ‘Smapple‘ was filed by a Japanese entity dealing in repair and maintenance of mobile phones in the year 2017 and the same after acceptance was published for registration by the Japanese Patent Office on November 7, 2017.

OBJECTIONS RAISED BY APPLE BEFORE THE BOARD

Subsequently, Apple filed an opposition claim in January 2018 contesting that the Trademark granted in the present case, Smapple, was liable to be struck down or cancelled as being in violation of Article 4(1)(xv) of the Japanese Trademark Act as the same is likely to cause confusion with a well-known Trademark i.e. Apple.  Apple further contested the granting of the trademark on the ground that ‘Smapple’ not being a dictionary word, an ordinary consumer in the market is likely to confuse and think the opposed mark to be ‘Sm’ and ‘Apple’ thereby representing a relationship as if the Trademark in contention stood for maintenance services offered by ‘Apple Inc.’.

THE DECISION OF THE BOARD

While the Board acknowledged the fact that the trademark ‘Apple’ of Apple Inc. has a remarkable degree of popularity and reputation when seen in the context of business in the field of manufacturing and distribution of smartphones, laptops etc.  and the same is not true with respect to the business of the company with the opposed trademark i.e. the business of repair and maintenance of mobile phones. Moreover, the Board also found ‘Smapple’ and ‘Apple’ to be totally different on the ground that they were sufficiently distinguishable in the visual, phonetic and conceptual sense of things.

Further, the Board did not accept Apple Inc.’s argument that the words ‘Sm’ in the opposed trademark implied a service mark and the addition of the same to ‘Apple’ is sufficient enough to confuse the consumers in the market to understand it as ‘Service Mark for Apple’. This argument on behalf of Apple Inc. was rejected by the Board on the ground that the Trademark in question cannot be broken or divided into different components and then examined. As per the opinion of the Board, any such examination has to take place while keeping the entirety of the Trademark in mind.

With respect to the Trademark ‘Apple’, the Board observed the same not to be a coined term but a common word from the English Dictionary. Hence, the Board held that the relevant consumers are unlikely to confuse between the Trademarks ‘Apple’ and ‘Smapple’. Thus, the objection claim filed by Apple Inc. was rejected by the Board.

ANALYSIS OF THE JUDGEMENT

The Board while rejecting the objection claim of Apple Inc. took a very brave stand while ruling against such a giant of the technology world. However, there are certain facets of the decision of the Board which we fail to agree with. In order to see whether a certain Trademark may cause confusion among the consumers in the market, it is very important to see as to what is the ‘relevant market’ in which the company operates. In the legal framework of affairs in Japan, there does not exist any straightjacket definition of ‘relevant market’ and the same is determined on the basis of certain tests based on product or service definition and geographical definition. One may find a very similar definition of ‘relevant market’ under Section 2(r) of the Competition Act in India.

Thus, if we look at the nature of the goods and services in question in the present case i.e. mobiles and repair services, it is very clear that although both are not identical yet the markets in this case, are quite similar and related with each other. Hence, we find it difficult to understand (given the nature of the market and the fact that Apple Inc. also provides repair and maintenance) as to how ‘Smapple’ may not lead to a confusion in the minds of the consumers in the market. This becomes all the more relevant when Apple Inc. has a 44.8 percent share in the smartphone market in its geographical market i.e. Japan.

In its decision, the Board also accepted and acknowledged the fact that the trademark ‘Apple’  of Apple Inc. had a great degree of reputation and acceptance. However, it is difficult to understand as to how the Board (despite acknowledging this fact) overlooked the impending possibility of the confusion that may be created among the consumers due to the grant of the trademark to ‘Smapple. In similar vein, it is also difficult to understand the logic of the Board when it observed that ‘Apple’ is a familiar English term among relevant public to mean a round fruit with red or green skin and a whitish inside especially when in the mind of any rationale consumer the term ‘Apple’ when seen in consideration with the market of mobile or laptops evokes the image of Apple Inc. and not that of Apple- the fruit.

Article 4(1)(xv) of the Japanese Trademark Act clearly states that a trademark which might cause confusion is not to be registered. In the present case, considering the phonetic similarity as well as taking into account the markets in consideration, there does exist a huge possibility of ‘Smapple’ being confused for ‘Apple’ in the minds of the consumers in the relevant product and geographical market. Thus, in our opinion, the decision of the Board in granting the Trademark ‘Smapple’ not only renders the trademark protection in Japan weaker but it also opens the floodgates for litigation in the subsequent cases flooding the Japanese markets with such similar trademarks and trade names in subsequent instances to follow.


(Akash is currently a fourth year BBA LLB (Intellectual Property Rights Honours) student at National Law University, Jodhpur. He has a keen interest in Trademarks Law and Intellectual Property Rights in general.)

(Raja is currently a third year BA LLB student at National Law University, Jodhpur. He has a keen eye for events shaping the arena of International Relations and Politics apart from his love for the Indian Constitutional Law.)

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