Case No. IP-2015-000175

75.The Burgista sign was first used by UPL in July 2015. Although its first restaurant in Shepherd’s Bush was not opened until September 2015, since July 2015 UPL has used the sign in its Instagram, Facebook and Twitter accounts. July 2015 is therefore the relevant date for the assessment of the reputation of the Trade Mark.76.The Platzl brothers opened their first restaurant in Leonding, a small city near Linz, in October 2012. By 2014 the chain had expanded to four restaurants, at this time still trading under the name ‘Burgers’. Two were in Linz and one in Pasching.77.In May 2014 the Plastzls sold the business to Quadriga, an equity fund, although they remained officers.78.The first two restaurants to trade under the Trade Mark were opened in Vienna in December 2014. In the same month the trading name of the restaurants in Linz and Pasching were changed to ‘Burgerista’, but that of the Leonding restaurant remained ‘Burgers’. A further restaurant was opened in Salzburg in June 2015. The first restaurant in Germany was opened in July 2015 in Mönchengladbach.79.Thereafter the chain continued to grow, today comprising nine in Austria and the same number in Germany.80.Mr Werner, the current CEO of BG, gave evidence of €8 million having been invested in promoting the Burgerista brand when the shares were acquired (which I take to be the acquisition by Quadriga) and a further €30 million some time since. He said that on average investments in the region of €1-1.5 million were required for what he termed the opening and rolling out of each new restaurant. As he put it:“This is where the real marketing investment is – in the restaurants themselves, which are designed and built to reflect the Burgerista restaurant brand.”81.Mr Werner’s evidence was that BG is aiming to form part of what he described as a newly emerging premium burger market, distinguishing itself from the likes of McDonalds and Burger King. He referred to:“…the real drivers behind this smaller, emerging market: namely a focus on product quality, overall experience and a ‘local’ and more intimate feeling.”82.Turnover was a little over €4 million in 2014 and about €9¼ million in 2015, with a total of about 865,000 transactions in 2015. BG has two individuals who work on marketing. Marketing expenditure in 2014 was €1,229,000 and in 2015 €1,836,900 but this included the costs of trade mark registration, the fees of external marketing consultants and the costs and expenses of the marketing team. It is not clear how much was spent on advertising the brand. To the extent that it was spent, much or all of it went on using social media sites: Facebook, Twitter and Instagram, although Mr Werner’s evidence did not state how much of this was done by July 2015.83.As of July 2015 BG had six restaurants trading under the Trade Mark in Austria and one restaurant opened in that month in Germany. Two were in Vienna, four were in the smaller cities of Linz, Salzburg and Mönchengladbach and one in Pasching (population 7,300). I have stated the sizes of these places to give some context, but on the present facts I think this is of very limited relevance. I cannot assume, for instance, that because BG had two restaurants in Vienna, the Trade Mark was known throughout Vienna. That seems to me unlikely. Mr Werner himself stated that BG was aiming for a local and intimate feeling to the restaurants. This suggests that they were not presented to the public as part of a chain, or at least it was not emphasised. The reputation of a restaurant is typically local to where it is located unless it has become very famous. I do not doubt that customers eating at the Burgerista restaurants included tourists, but there was no evidence that the restaurants were known outside their locales to any significant degree in July 2015 and quite possibly they are not even now. 84.The budget of €1-1.5 million spent on each restaurant went largely on the designing and building of the restaurant itself, rather than on marketing.85.In July 2015 the Trade Mark was far from being known throughout Austria. It had not become known outside Austria, save possibly to a very limited extent in Mönchengladbach. It was known in two local areas of Vienna, two in Linz, one in Salzburg and one in Pasching. No figure has been attempted for the share of the European Union restaurant business held by the restaurants trading under the mark, but it must have been very small indeed, even if presented as a share of the burger restaurant business. Marketing was largely confined to social media sites, although it is not clear how much of this had been done by July 2015.86.In my view, although at the relevant date the Trade Mark had a reputation of some sort by dint of restaurants having traded under the Trade Mark, it did not have a reputation in the Union within the meaning of art.9(2)(c). Dilution 87.Ms Chantrielle argued that there could be no dilution because assuming that the Trade Mark had a reputation, such reputation was only in Austria, whereas use of the sign was confined to the UK. BG had not produced any evidence of change in economic behaviour on the part of the average consumer and it could not because the trade mark’s reputation was in one place and UPL’s restaurants in another.88.As I have mentioned, Iron & Smith was about an opposition to an application to register a national mark pursuant to art.4(3) of Directive 2008/95. The second paragraph of the ruling was as follows:“2. If the earlier Community trade mark has already acquired a reputation in a substantial part of the territory of the EU, but not with the relevant public in the Member State in which registration of the later national mark concerned by the opposition has been applied for, the proprietor of the Community trade mark may benefit from the protection introduced by art.4(3) of Directive 2008/95 where it is shown that a commercially significant part of that public is familiar with that mark, makes a connection between it and the later national mark, and that there is, taking account of all the relevant factors in the case, either actual and present injury to its mark, for the purposes of that provision or, failing that, a serious risk that such injury may occur in the future.”89.Advocate General Wahl put it this way:“[40] … whereas the relevant public of the Member State in which the later trade mark has been applied for is not decisive in determining whether the earlier Community trade mark enjoys a reputation in the EU for the purposes of art.4(3) of the Directive, that public is – conversely – of paramount importance in determining whether the later national trade mark would take unfair advantage of, or be detrimental to, the earlier Community trade mark with a reputation. It must be borne in mind that the protection afforded to a national trade mark is circumscribed, as a matter of principle, by the territory of the Member State in which the mark is applied for. That is why, when dealing with grounds of refusal as regards national trade marks, it stands to reason that the relevant public for the purposes of determining the existence of detriment or unfair advantage must be that in that Member State.”90.It appears from the judgment that Unilever, the owner of the earlier Community trade mark, had not shown any use of the mark in Hungary. However, on my understanding of the Court’s ruling, if Unilever proved a genuine intention to market in Hungary and that in consequence there was a serious risk of injury to the mark in the future, it was entitled to succeed in its opposition.91.Translating this to the present facts, if I am satisfied that BG has a genuine intention to open restaurants in the London area in the foreseeable future and that this will lead to a serious risk of dilution of the Trade Mark, then the injury element of art.9(2)(c) would be satisfied (if there had been a relevant reputation to injure).92.Mr Werner said that it was BG’s intention to open its restaurants across the European Union, including the United Kingdom. The company wishes to expand the business by franchising. In November 2016 it posted a notice on its website of its plans to franchise its name. It has received over 100 notifications of interest from potential franchisees, a list of which was exhibited by Mr Werner, including two notifications from potential franchisees in London.93.It seems to me credible that restaurants may be opened in the London area under the Trade Mark in the foreseeable future. It cannot be said whether such restaurants will be located near UPL’s restaurants, but the evidence of a ready likelihood of confusion between the Trade Mark and Burgista demonstrated in the context of art.9(2)(b) suggests that confusion of this type would occur, particularly on social media.94.There would be two consequences. First, there would be a link between mark and sign in the mind of the average consumer. Second, there would be inevitable dilution. I do not believe that I needed evidence from Mr Werner anticipating a change in economic behaviour of relevant persons – customers going to this restaurant rather than that because of the confusion – to establish dilution. 95.Had the Trade Mark had a reputation in the Union, I would have found that there was a likelihood of infringement in the future under art.9(2)(c).