Hogan Lovells assists PayPal in securing an important victory for German retail
Decision of the German Patent and Trademark Office of 27 March 2018 (ref. no. 30 2013 057 574 – S 33/17/Lösch)
The German PTO has seen the light in the dark of the “Black Friday” battles: The term has been declared free for all to use in commerce, signaling the end of a trademark monopoly that has been aggressively exercised against German retail during the past 18 months. Hogan Lovells, represented by Anthonia Ghalamkarizadeh and Dr. Thomas Richter, assisted PayPal in securing this important victory for the entire German retail market.
The words “Black Friday” resonate with bargain hunters across the globe. Black Friday, the day after Thanksgiving, has a long tradition of special deals and promotions. It is by far the most profitable day of the year for retailers in the US, where the tradition originated. And in the age of global e-commerce, Black Friday as a day for special sales promotions has also become entrenched in many other markets, including Germany. So the commercial attraction of the phrase “Black Friday” is obvious – and holding a monopoly over its use in advertising and retail would be highly profitable. Hong Kong based Super Union Holding Ltd. went down this road when it obtained a German trademark registration for “Black Friday” that covers nearly every retail service under the sun. Following the acquisition of the mark in 2016, the trademark owner and its licensee Black Friday GmbH started to aggressively monopolize and capitalize on the word mark. Numerous retailers in Germany received propositions for expensive licensing deals or were slapped with cease and desist letters warning them off a use of “Black Friday” in their sales promotions. The aggressive enforcement culminated in a lawsuit with significant damages claims against a leading global online shopping platform.
This commercialization strategy caused considerable stir in the German market. Many retailers resorted to alternative wording such as “Super Friday” and shifted their sales to the less hazard-fraught “Cyber Monday”. Eventually, more than 13 cancellation requests were filed against the German trademark registration for “Black Friday”. PayPal, itself not the target of any enforcement measures, decided to join the cancellation proceedings to take a stand for the rights and interests of retail. PayPal, along with many other free market advocates, takes the position that the phrase “Black Friday” falls into the public domain and must be freely available to all market players to use for sales promotions and in advertising. Originally coined in the US, “Black Friday” has long become a colloquial and established term in many other countries, including Germany, where the concept was introduced more than 10 years ago by several major global retailers.
In its decision of 27 March, the German PTO has followed this line of arguments, holding that the term “Black Friday” lacks distinctiveness and is not suited to identify commercial origin. The decision is based on the extensive evidenced produced by 13 of the cancellation applicants, demonstrating the long-standing use of “Black Friday” in Germany and related media coverage. The Office found that by 2013, when the trademark application for “Black Friday” was filed, the term had already become colloquial. And it is increasingly becoming entrenched even further in German market customs. Just like so many other festivities, social trends and customs, “Black Friday” has found its way from the US to Germany and has become a part of the local language and culture.
Super Union will surely appeal the decision, given its vast commercial implications. But PayPal and the other 12 successful applicants have now struck the first blow in the dismantling of a monopoly that was flawed from the start. We can only hope that upon appeal, the German Federal Patent court will expedite its proceedings, so that German retail obtains legal certainty on the use of “Black Friday” before the next sales day comes up on 23 November 2018.