Adidas' three-stripes have been ruled invalid as a trademark by a European Union court which said they lacked a distinctive character recognisable throughout the 28-country bloc.

But the German sporting goods company, whose shares were down 1.3 percent in a broadly weaker market, said the court's ruling on Wednesday only affects a particular use of the symbol.

The sporting goods industry has seen a rise in trademark and patent disputes as the biggest players try to differentiate their products and justify premium pricing.

High-profile cases have included Adidas clashing with Skechers USA and Nike taking on Puma.

The General Court of the European Union said it had upheld a 2016 decision of the European Intellectual Property Office (EUIPO) to annul a previous acceptance of the trademark, which Adidas registered in 2014 for clothing, footwear and headgear.

Adidas said its trademark consisted of "three parallel equidistant stripes of equal width applied to the product in whichever direction" but this was challenged by Belgium's Shoe Branding Europe after a decade-long dispute with Adidas.

The same EU court had rendered Shoe Branding's own two-stripe trademark invalid last year, saying the stripes were too similar to those of Adidas.

Shoe Branding bought Patrick, which was founded in 1892 and says it is the oldest sports brand in Europe, in 2008. Patrick features two stripes on its shoes and clothing.

Adidas needed to show the three stripe mark had acquired a "distinctive character" throughout the EU based on its use so that consumers inherently knew a product was from Adidas and could distinguish it from products of another company.

The court said the mark was not a pattern but an "ordinary figurative mark" and it was not relevant to take into account specific uses involving colours.

Adidas, which can still appeal to the European Court of Justice, said in a statement the ruling was limited to a "particular execution" of the three-stripe mark and did not impact other protected uses of the trademark in Europe. It was not immediately clear which use Adidas was referring to.

"Whilst we are disappointed with the decision, we are further evaluating it and are welcoming the useful guidance that the court will give us for protecting our 3-stripe mark applied to our products in whichever direction in the future," it said.

The court said Adidas had provided evidence related to the mark's use in five EU countries, but not throughout the bloc.

Geert Glas, an intellectual property lawyer at Allen & Overy in Brussels, said the decision seemed to be more based on the procedure and that Adidas should be able to produce evidence showing that the three stripes had distinctiveness in Europe.

"It's a setback for Adidas, but it shouldn’t be the end of their three stripes trademark," Glas said.

In other cases involving the big sporting goods players, Nike last year filed a lawsuit accusing German rival Puma of using patented athletic shoe technology without authorisation.

And a US appeals court said Adidas can protect its Stan Smith tennis shoe against an alleged Skechers knockoff, but that Skechers could sell another mimicking Adidas' three-stripes.

In 2017 a US judge rejected Adidas' effort to block Skechers from selling athletic sneakers that it said copied its "Springblade" concept.

First Published:Jun 19, 2019 4:44 PM IST