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Date of Judgment: December 20, 2011

Issuing Authority: Supreme Court

Level of the Issuing Authority: Final Instance

Type of Procedure: Judicial (Administrative)

Subject Matter: Trademarks

Main text of the judgment (decision):

1.The judgment in prior instance is quashed.

2.The appeal to the court of second instance filed by the appellee of final appeal is dismissed.

3.The appellee of final appeal shall bear the total court costs.

Reasons:

Concerning the reasons for acceptance of final appeal argued by the appeal counsels AMINO Tomoyasu, et al. (except for the reasons excluded)

1. In this case, the appellee of final appeal seeks revocation of the trial decision rendered by the Japan Patent Office (JPO) to rescind the appellee's trademark registration pertaining to the designated services in Class 35, "advertising, business analysis and guidance, marketing research, provision of information concerning sales of goods, business management of hotels, publicity material rental" (hereinafter referred to as the "Subject Services"), in response to the request for a trial for rescission of the trademark registration pertaining to the Subject Services, filed by the appellant of final appeal under Article 50, paragraph (1) of the Trademark Act by reason of the non-use of the registered trademark.

The appellee insists that it has been using the registered trademark in connection with the service of "provision of information concerning sales of goods" among the Subject Services (this particular service shall hereinafter be referred to as the "Designated Service").

2. The outline of the facts legally determined by the court of prior instance is as follows.

(1) The appellee of final appeal is a stock company engaged in the business of planning, production, sale, etc. of game software programs, and holds a trademark right for the registered trademark, Registration No. 4548297, which is composed as indicated in 1 of the list of trademark registrations attached hereto, in connection with the designated services as indicated in 2 of said list, which fall within Class 35 and Class 41 of Appended Table 1 of the Order for Enforcement of the Trademark Act (prior to the revision by Cabinet Order No. 265 of 2001; hereinafter referred to as the "Appended Table of the Order") (the application for the trademark registration was filed on January 22, 2001, and the establishment of the trademark right was registered on March 1, 2002; this registered trademark and the relevant trademark registration shall hereinafter be referred to as the "Trademark" and "Trademark Registration," respectively).

(2) The appellee, in the course of presenting on its own website the game software programs that it had developed independently, indicated the Trademark on said website on the following occasions: (i) on October 12, 2004, when the appellee indicated on said website the date of release, allowable number of players, price, and other matters regarding the game software programs for which the appellee participated in the development projects and which were put on sale by Company A; and (ii) on January 23, 2005, when the appellee indicated on said website the content, specification, price, date of release, method of purchase, and other matters regarding the music CDs which contained the music works used in the game software programs that the appellee had developed independently and which were put on sale by Company B (hereinafter these goods shall be referred to as the "Goods" and the appellee's acts of indicating these goods with the Trademark shall be referred to as the "Acts of Indication," respectively). Via the appellee's website, users were able to access the websites of Company A and Company B that were the sellers of the Goods and purchase the Goods on their websites.

(3) On March 15, 2007, the appellant filed a request for a trial under Article 50, paragraph (1) of the Trademark Act for rescission of the Trademark Registration pertaining to the Subject Services, and the precautionary registration of such filing was made on April 4, 2007.

In response to this request for a trial, the JPO carried out examination in Trial for Rescission Case No. 2007-300303, and accordingly, on September 26, 2008, the JPO rendered a trial decision to rescind the Trademark Registration pertaining to the Subject Services, on the grounds that there is no proof that the Trademark had been used in Japan within three years prior to the date of precautionary registration mentioned above in connection with any of the Subject Services by any of the holders of the trademark right, of the exclusive right to use, or of the non-exclusive right to use, and that the appellee has not shown any just cause for such non-use (this trial decision shall be referred to as the "Trial Decision").

3. In the prior instance, the appellee asserted the circumstances mentioned in 2(2) above as the proof of its use of the Trademark in connection with the Designated Service. The court of prior instance upheld the appellee's claim for revocation of the Trial Decision, determining that by performing the Acts of Indication, the appellee can be found to have used the Trademark in connection with the Designated Service in Japan within three years prior to the precautionary registration, so there was an error in the Trial Decision which concluded that there was no proof that the appellee had used the Trademark for any of the Subject Services.

4. However, we cannot affirm the determination of the court of prior instance mentioned above, on the following grounds.

(1) It is provided that an application for trademark registration shall be filed for each trademark by designating goods or services in connection with which the trademark is to be used, in accordance with the classes of goods or services provided by the Order for Enforcement of the Trademark Act (Article 6, paragraphs (1) and (2) of the Trademark Act). The Order for Enforcement of the Trademark Act specifies such classes in accordance with the international classification as defined in Article 1 of the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks, as revised at Stockholm on July 14, 1967, and at Geneva on May 13, 1977, and amended on October 2, 1979 (hereinafter simply referred to as the "international classification"). Said Order gives a heading to each class as an indicator for understanding the content of the goods or services in the relevant class (Article 1 and the Appended Table of said Order), and the Ordinance for Enforcement of the Trademark Act specifies the goods or services in each class by subdividing them within the class while following the international classification (Article 1 of the Order for Enforcement of the Trademark Act, Article 6 and the Appended Table of the Ordinance for Enforcement of the Trademark Act). In addition, the JPO has developed the Examination Guidelines for Similar Goods and Services as the standards for determining the similarity of goods or services in the examination process of applications for trademark registration, in which goods or services which are similar to each other shall fall within the same group of similar goods or services.
Hence, it is appropriate to construe the meaning of the goods or services specified in the Appended Table of the Ordinance for Enforcement of the Trademark Act by taking into account factors such as (i) the heading given to the relevant class in the Appended Table of the Order for Enforcement of the Trademark Act, (ii) the content and nature of the goods or services specified as falling within the relevant class in the Appended Table of the Ordinance for Enforcement of the Trademark Act, (iii) the description of the goods or services as indicated in the explanatory notes attached to the list of classes which constitute part of the international classification, and (iv) the standards for determining identicalness for each similar group under the Examination Guidelines for Similar Good and Services.

(2) The Designated Service can be construed to refer to "provision of information concerning sales of goods," specified in Class 35(iii) of the Appended Table of the Ordinance for Enforcement of the Trademark Act which had been in force at the time of the application for the Trademark Registration (prior to the revision by Ordinance of the Ministry of Economy, Trade and Industry No. 202 of 2001; hereinafter referred to as the "Appended Table of the Ordinance"). Accordingly, from the viewpoint explained in (1) above, we examine the meaning of the phrase "provision of information concerning sales of goods," specified in Class 35(iii) of the Appended Table of the Ordinance.

Class 35 of the Appended Table of the Order is under the heading of "advertising, business management or administration, and office functions." In light of the content and nature of the services specified in Class 35 of the Appended Table of the Ordinance as falling within this class, as well as the facts that [i] the explanatory notes attached to the list of classes which constituted part of the international classification applicable at the time of the application for the Trademark Registration (Seventh Edition of the Nice Classification) provide that Class 35 includes "mainly services rendered by persons or organizations principally with the object of help in the working or management of a commercial undertaking, or help in the management of the business affairs or commercial functions of an industrial or commercial enterprise," and that [ii] in subclass (iii) among subclasses of services (i) through (xi) included in Class 35 of the Appended Table of the Ordinance, "provision of information on sales of goods" is listed together with "business analysis and guidance," "marketing research" and "business management of hotels," and is also specified in the Examination Guidelines for Similar Goods and Services as falling within the same group of similar goods or services, the phrase "provision of information concerning sales of goods" can be regarded as referring to a service characterized by the nature of helping a commercial enterprise in its management or administration, as other services in the same subclass, namely "business analysis and guidance," "marketing research," and "business management of hotels" are regarded as such. Also taking into consideration the wording of the phrase, it is appropriate to construe that the phrase "provision of information concerning sales of goods," specified in Class 35(iii) of the Appended Table of the Ordinance, refers to the service of providing a commercial enterprise with information for helping its management or administration. Assuming so, an activity to provide a commercial enterprise with information concerning the sales records of goods or information concerning statistical analysis of sales of goods can be regarded as constituting this particular service, and therefore an activity to present goods to consumers, the end users of the goods, cannot be regarded as "provision of information concerning sales of goods."

(3) The explanatory notes attached to the list of classes which constituted part of the international classification applicable at the time of the application for the Trademark Registration were revised by additionally including in Class 35 such service as "bringing together, for the benefit of others, of a variety of goods (excluding the transport thereof), enabling customers to conveniently view and purchase those goods" (revision effective as of January 1, 1997). Subsequently, under Act No. 55 of 2006, "retail services and wholesale services, namely, the provision of benefits for customers conducted in the course of retail and wholesale business" were included in the scope of services in connection with which a trademark is to be used (Article 2, paragraph (2) of the Trademark Act). Following this, Class 35 of the Appended Table of the Order for Enforcement of the Trademark Act has been revised by including therein retail services and wholesale services, namely, the provision of benefits for customers conducted in the course of retail and wholesale business, and Class 35 of the Appended Table of the Ordinance for Enforcement of the Trademark Act has also been revised so as to recognize the services of making arrangements for the benefit of consumers, the end users of goods, such as facilitating their choice of goods upon waiting on them or by providing them with catalogues, as the services in connection with which a trademark is to be used. However, these legal revisions had not yet been made by the time of the application for the Trademark Registration, so even in consideration of the abovementioned legislative developments, there is no room to consider that at the time of the application for the Trademark Registration, the service of making such arrangements for the benefit of consumers was included in the scope of "provision of information concerning sales of goods," which had been listed in Class 35(iii) of the Appended Table of the Ordinance since before the abovementioned legal revisions were made.

(4) Next, we look at the Acts of Indication. According to the facts mentioned above, the Acts of Indication were nothing more than such acts wherein the appellee, in the course of presenting on its website the game software programs that it had developed, also presented to consumers on said website the Goods that were sold by other companies. These kinds of acts cannot be regarded as providing a commercial enterprise with information for helping its management or administration. Consequently, the Acts of Indication cannot be the proof to show that the appellee had used the Trademark in connection with the Designated Service.

5. The determination of the court of prior instance contains violation of laws and regulations that apparently affects the judgment in that it found an error in the Trial Decision for reasons that go against this court's reasoning. The appeal counsels' arguments are well-grounded, and the judgment in prior instance should inevitably be quashed. Since there is no such proof that the appellee or any holder of the exclusive or non-exclusive right to use had used the Trademark in connection with any of the Subject Services, nor can we find any just cause for their non-use of the Trademark, there is nothing illegal in the Trial Decision that rescinded the Trademark Registration pertaining to the Subject Services. Hence, the appellee's claim to seek the revocation of the Trial Decision is groundless and therefore should be dismissed.

Therefore, the judgment has been rendered in the form of the main text by the unanimous consent of the Justices.

(This translation is provisional and subject to revision.)