Louboutin issued trade mark infringement proceedings in the Netherlands against Van Haren in 2012 as a result of it selling high-heels with red soles. Van Haren counterclaimed challenging the validity of the trade mark. As those with an interest in the area will know, Louboutin filed similar proceedings against Yves Saint Laurent in 2011 which ultimately resulted in Louboutin’s trade mark being found valid but its scope limited so as not to include high-heels which are red all over (rather than just the sole).

As for the ongoing proceedings in the Netherlands, the District Court of the Hague referred a number of questions to the European Court of Justice. The questions principally concern the interpretation of the prohibition against registration of marks consisting exclusively of a shape that gives substantial value (Article 3 of Directive 2008/95).

The European Court must therefore consider: (a) whether the prohibition is capable of applying to a sign combining shape and colour (i.e. the sole of a shoe and the colour red); and (b) if it is, determine how “substantial value” is to be assessed.

As regards (a), the AG has maintained his initial view that the prohibition is capable of applying to a sign combining shape and colour. A number of commentators consider such a conclusion to be damaging to Louboutin.

However, the position in respect of (b) is much more complicated and is the key battle ground. The key question to be determined is the issue of “substantial value” and where the value of the red sole stems from.

It is Louboutin’s position that the value of the red sole stems exclusively from years of investment in marketing to build a luxury shoe brand immediately recognisable for its red soles and that the “shape” of the sole is therefore of little importance to the value (and the prohibition would therefore not apply). By contrast, Van Haren will be arguing that the sign derives its value from the shape and colour (i.e. the distinct red colour is visibly limited to the shape/contours of the soles) and therefore falls within the prohibition and the trade mark is consequently invalid.

The AG does not give a definitive view on that point and reiterated what he stated in his first opinion and noted that his analysis “relates exclusively to the intrinsic value of the shape, and must take no account of the attractiveness of the goods flowing from the reputation of the mark”.

Although taken into account and considerably persuasive, the AG’s opinion is not binding on the European Court and on the basis that the key question as to the origin of the value of the trade mark is still to be determined, all is still very much to play for. That said, and as noted by the AG in his first opinion, the District Court of the Hague appears to be of the view that the colour of the red sole gives substantial value to the goods which suggests it may be leaning towards the conclusion that the prohibition applies.

It will obviously be a huge blow to the Louboutin brand if the trade mark is declared invalid. However, given the reputation of the brand, actions for passing off and unfair competition may provide alternative routes to protect those famous red soles.

The AG’s full second opinion is available here.