Article by author, Ms. Mami Gosho (五所万実), who is a research associate (助教) at Keio Univ (慶応義塾大学) on linguistic (言語学).
AUGUSTA NATIONAL, INC. v. KONAMI HOLDINGS CORPORATION
(Darts-ip Ref.: darts-110-639-G-ja, IP High Court 2019.2.6, 平成31(行ケ)10154, Request for Cancellation of Trial Decision)
AUGUSTA NATIONAL, INC., Plaintiff
Plaintiff’s marks: MASTERS (in standard characters), Reg. No. 1325831
Reg. Nos. 2198446 & 1934194
KONAMI HOLDINGS CORPORATION, Defendant
Mark: KONAMI SPORTS CLUB MASTERS (or “コナミスポーツクラブマスターズ” in Japanese) (Reg. No. 5712040)
The world-famous MASTERS tournament has been annually conducted by plaintiff, Augusta National, Inc. since 1934. Meanwhile, KONAMI SPORTS CLUB has been engaged by defendant, Konami Holdings Corporation, an industry leader in sports business in Japan as one of the Konami Group companies. The defendant is the owner of the mark, KONAMI SPORTS CLUB MASTERS (hereafter, “Mark”).
The plaintiff filed with the Japan Patent Office (JPO) an invalidation request against the Mark (for golf-related goods and services in classes 16, 25 and 41) on the basis of the followings:
1) The Mark is similar to the plaintiff’s marks(Article 4-1-11)
2) There is a likelihood of confusion between the Mark and the plaintiff’s marks for consumers (Article 4-1-15)
3) Unfair use of the Mark to take a free-ride on the fame, reputation and goodwill of the plaintiff’s marks(Article 4-1-19)
4) The Mark is liable to cause damage to public order and morality(Article 4-1-7)
However, the JPO dismissed the plaintiff’s request on June 25, 2018 (Darts-ip Ref.: darts-356-694-F-ja). The plaintiff filed a lawsuit for cancellation of the JPO decision, but the IP High Court upheld the decision on February 6, 2019, finding that 1) the plaintiff’s marks and the defendant’ Mark are not similar to each other in terms of appearance, sound and concept, 2) there is no likelihood of confusion between the opposing marks in connection with the designated goods and services, 3) there are no specific facts and evidence to support the plaintiff’s allegations of defendant’s unfair use of the Mark and likewise 4) there are not enough facts and evidence to support the plaintiff’s allegations of the damage to public order or morality caused by the Mark.
The details of the plaintiff’s allegations and the findings thereon by the IP High Court are as follows (Only substantive matters):
The plaintiff maintains that the term “MASTERS” is exclusively associated with the MASTERS tournament in conjunction with golf-related goods and services; thus, the public always associates “MASTERS”, which is the dominant part of the Mark with the plaintiff’s “MASTERS.” Hence, the Mark, despite comprised of two or more words, is confusingly similar to the plaintiff’s marks.
However, the IP High Court found as follows: the term MASTERS is not only associated with the plaintiff’s MASTERS tournament but also widely known as “various sports and tournaments for masters or competitors over a certain age.” Further, the term does not play a dominant role for KONAMI SPORTS CLUB, which is famous among Japanese consumers, given the fact that the term MASTERS has been used in many tournament names, including but not limited to golf. Through such recognition and usage, consumers will primarily associate the Mark with “various sports and tournaments related to KONAMI SPORTS CLUB” or just with KONAMI SPORTS CLUB. Hence, the Mark is dissimilar to the plaintiff’s marks, including MASTERS and MASTERS & Design, in appearance, sound, and concept.
Likelihood of Confusion
The plaintiff alleges that the plaintiff’s MASTERS mark is unique as it is applied to golf-related goods and services (while not a coined term), and is so world-renowned for the golf tournament that the Mark is highly likely to cause confusion when applied to the relevant designated goods and services among common consumers and traders, and is likely to cause mistake as to affiliation, license or connection with the plaintiff.
In this regard, the IP High Court found as follows: The plaintiff’s marks are not similar to the Mark, and in golf-related businesses other than the MASTERS golf tournament, the term MASTERS is not assumed to be sufficiently well-known and distinctive for holding an identification function in Japan. Hence, the Mark is not considered likely to cause mistake as to the connection and affiliation with the plaintiff’s business, even if it is used in connection with the designated goods and services.
Summary and Implications
The heart of the plaintiff’s allegations is that the Mark is associated with the MASTERS tournament as applied to the relevant designated goods and services; however, the IP High Court dismissed all allegations, which assume that the term MASTERS has no meaning other than the MASTERS tournament in the relevant industry, and ignore the distinctiveness of KONAMI SPORTS CLUB.
The court deemed that 1) the definition of MASTERS has been widely recognized among sports-enthusiasts as the collective term for various tournaments for competitors over a certain age, as defined by the dictionary, other than as the abbreviation of the world-famous plaintiff’s golf tournament, and that 2) the term is actually used in many tournament names in Japan, and finally, that 3) in the Mark the word MASTERS alone does not necessarily play a dominant role and does not solely indicate the MASTERS golf tournament since the remaining portion, KONAMI SPORTS CLUB is also distinctive given the fact that it is an industry leader in sports business in Japan.
We can learn from this case that the dominant portion of a composite mark which includes the term of a renowned mark can be determined by the originality and assigned meaning of the term, and the distinctiveness of the term in the specifically designated area of business.
The plaintiff filed an appeal with the Supreme Court on March 22, 2019, to overturn the lower court decision. The outcome is now expected.