On November 28, 2023, the Italian Supreme Court rendered a significant judgment in the case of Piaggio versus Zhejiang ZhongNeng Industry & other parties (decision no 33100 of 2023) where an appeal in this case was initiated by Zhejiang ZhongNeng Industry & other parties  with the purpose of contesting the ruling issued by the Turin Court of Appeal where the court’s decision upheld the legitimacy of Piaggio’s three-dimensional trademark and acknowledged that the copyright pertaining to the renowned two-wheeled vehicle “Vespa” had been infringed upon by one of the models produced by the appellants.

Piaggio & C. SpA, known colloquially as Piaggio, is an Italian company specializing in the manufacturing of motor vehicles. Their product range includes both two-wheeled motor vehicles and compact commercial vehicles, marketed under four distinct brands: Piaggio, Vespa, Aprilia, Moto Guzzi, and Derbi. The company’s main offices are situated in Pontedera, Italy. Established by Rinaldo Piaggio in 1884, the company initially focused on the production of locomotives and railway carriages before transitioning into the motor vehicle industry.

AND ZNEN Group, also referred to as Zhongneng Vehicle Group, is a Chinese motorcycle producer established by Chen Huaneng in June 1988, situated in Taizhou, Zhejiang province. The company’s initial foray into manufacturing occurred in 1996, marking the debut of its initial petrol mopeds. Following two decades of operation within the automotive sector, Zhongneng Industry Group specializes in three primary product lines: petrol mopeds, electric mopeds, and motorcycles.

The case revolves around the concept of Copyright and 3D Trademark IP rights involving Piaggio & C.SpA and Zhejiang ZhongNeng Industry as its contestents. Piaggio’s three-dimensional trademark, which included a scooter’s shape and was registered and granted  in 2013 (A 3D Trademark is a trademark which protects the shape and protects the three-dimensional space).

The plaintiff/appellant( Zhejiang ZhongNeng Industry) initiated first tier proceedings against Piaggio in the year 2014 in the Court of Turin but the court of Turin rejected the appeal of plaintiff. In 2017, plaintiff filed an appeal in Turin Court of Appeal but the court of Turin, rejected the appeal of plaintiff. Finally an appeal against the decision was filed by the plaintiff in the Supreme Court of Italy.

CONTENTIONS OF ZHEJIANG ZHONGNENG INDUSTRY (PLAINTIFF/APPELLANT)

The plaintiff/appellant contended that the design elements comprising Piaggio’s 3D trademark for the Vespa Scooter are generic and fail to set the brand apart from others in the market, thus lacking distinctiveness. They also assert that due to the prevalence of similar designs in the marketplace, the trademark’s uniqueness is diluted in the eyes of consumers.Moreover, granting trademark protection may impose restrictions on competitors and lead to unfair competition.

The Chinese manufacturer further asserted that the design features serve functional purposes crucial to the operation of the scooter, rather than merely indicating brand origin, the functional elements should not be shielded by exclusive trademarks, as doing so could hinder industry competitiveness and innovation. Concerns regarding potential abandonment due to insufficient defense of the mark was also raised.

The plaintiff also raised a concern regarding the trademark application, the plaintiff alleged that Piaggio withheld significant information necessary for a valid registration, indicating a lack of transparency regarding the uniqueness of the design. Additionally, they accused Piaggio of making false claims regarding the distinctiveness of the trademarked components during the application process.

 

CONTENTIONS OF PIAGGIO (RESPONDENT)

Piaggio defended the 3D trademark of the Vespa scooter, asserting its originality and advanced features. They argued that the Vespa’s design intentionally diverges from industry norms, incorporating unique elements such as frame curvature and specific configurations, setting it apart from other scooter designs. To position the trademark as a symbol of the company’s commitment to innovation in a competitive industry, Piaggio provides evidence of industry acknowledgment and positive customer feedback endorsing the uniqueness and exceptional quality of its scooter design. Additionally, Piaggio supported its contention, backed by market research and consumer perception studies, that  the 3D design serves as a powerful brand identifier closely associated with the Vespa brand. By highlighting a clear and consistent link between the distinctive 3D design and the Vespa scooter in consumers’ minds, they establish the trademark as a lasting representation of the company’s legacy and brand identity.

Piaggio further argued that their brand strategy views the 3D logo as a dynamic and integral component, rather than a static symbol. They have showcased its consistent utilization across various Vespa scooter models and versions, as well as its active inclusion in advertising initiatives, product packaging, and promotional materials. Furthermore, the trademark’s importance as an active and essential aspect of the Vespa brand identity is emphasized through its integration into the company’s anniversary events and broader brand strategies, which extend beyond conventional branding practices within the scooter industry.

JUDGEMENT OF THE CASE

The Italian Supreme Court responded to the appeal and issued its ruling based on three grounds.

●  First being that the Piaggio ‘Vespa’ doesn’t contain any uniqueness, which makes it distinct from other brands. 

●   Secondly on the ground of appeal that Piaggio violated the Article 9 of IPC (Italian Industrial Property Code) [which states that “Signs shall not be registered as trademarks if they consist solely of the shape dictated by the nature of the product, the shape of the product necessary to obtain a technical result, or the shape that gives substantial value to the product”,]

●  Lastly (thirdly) on the ground of  an appeal where plaintiff challenged the existence of trademark of the Piaggio according to section of 2(10) which states that “works of industrial design having in themselves creative character and artistic value”, plaintiff claimed that Piaggio sign doesn’t have any artistic value, so it doesn’t qualify for trademark.

Regarding the admissibility of certain counterclaims made by Piaggio in the appeal proceedings and the acknowledgment of copyright infringement, the Supreme Court dismissed the first and third grounds of appeal in the present judgment, holding that the Court of Appeal’s interpretation and application of the law on these profiles was correct.

It was also noteworthy that the Supreme Court cited rulings from the EU Court of Justice in the Cofemel (C-683/17) and Brompton (C-833/18) cases, respectively, regarding the application of the “artistic value” requirement set forth in Article 2(10) of the Italian Copyright Act for design protection at the authorship level. The court held that Piaggio trademark has artistic design and has a feature on its scooter, which differentiates it with another brand.

Regarding the second ground of appeal, the Supreme Court largely deviated from the decision of the second tier court and upheld the appellants’ complaints regarding the infringement of Article 9 of the Italian Industrial Property Code and the overlap of the concepts of “substantial value” and “artistic value” of the “Vespa” shape.

The Supreme Court stated that the Court of Appeal erred in acknowledging the combination of protection provided by the three-dimensional trademark and copyright, specifically in recognizing the artistic value of the “Vespa” shape. This recognition implied the attribution of that substantial value, which precluded the shape’s registration as a trademark. To further explain this the very statement suggests that the recognition of a certain value implied that the shape in question couldn’t be registered as a trademark. In other words, because the shape was considered to have significant inherent value, it couldn’t be exclusively associated with a particular brand or company through trademark registration. Essentially, if something is widely recognized and valued for its inherent qualities, it cannot be monopolized by one entity through trademark protection.

The Supreme Court’s statement highlighted that the acknowledgment of the “Vespa” as an iconic symbol of Italian culture and artistic design, through numerous recognitions within the artistic and cultural spheres, indicates that the shape of a product holds artistic value akin to a work of design. Essentially, this suggests that the shape itself contributes significantly to the product’s value, thereby preventing its registration as a trademark. In simpler terms, when a product’s shape is widely celebrated for its artistic and cultural significance, it cannot be monopolized by trademark registration.

CONCLUSION

It is possible that the Italian Supreme Court’s position on the registration of designs with significant artistic value will have a significant impact on the registration of designs that are safeguarded by Italian copyright laws and conventional artistic value standards. According to the court’s stance, designs that possess noteworthy artistic value might face challenges when attempting to register a trademark and could potentially be vulnerable to invalidity claims.

The assessment of whether a form’s considerable value derives from the shape itself or from outside sources, such as the trademark owner’s reputation or their efforts to elevate the shape to iconic status, is at the heart of the court’s reasoning. The critical inquiry revolves around determining whether the inherent attractiveness of the shape serves as a primary factor in attracting customers, beyond its mere association with a specific brand. For example, when it comes to Louboutin shoes, one has to ask whether it’s the shoes’ characteristic i.e. the “Red Sole” that draws people in on its own or is it just because the Louboutin brand is attached to them. If the former is accurate, then the rule about significant value most likely applies. However, if the second situation is correct, this rule might not be fair because it seems unjust to punish a trademark owner for trying to make their brand successful.

But it appears that the Supreme Court’s decision overlooks a pertinent factor: the underlying reasons for the public’s admiration of a specific design. Using the Vespa as an illustration, it is asserted that the scooter’s appeal arises not solely from its physical form but rather from decades of deliberate actions by its proprietors to establish it as a symbol of Italian design, embodying a distinct lifestyle and cultural significance on a global scale. The primary contention here is that the inherent worth of the Vespa’s design itself is not definitive; rather, it is the consistent efforts of its owners over an extended duration to imbue the shape with cultural and symbolic significance that hold sway.