How strong does a brand have to be in order for the owner of a registered mark to be able to stop registrations for goods or services which it would never dream of providing? If a manufacturer of clothing or textiles were to attempt to register MICROSOFT for a fleecy type of material, would that infringe the rights of Microsoft Corporation? If a manufacturer of prophylactics were to attempt to register VISA for condoms, would that infringe the rights of Visa International? On the face of it, it seems that at least in relation to the latter, the strength of the trade mark VISA is sufficient in the UK to stop others from using the sign in relation to goods and services which Visa International has no interest in providing. This was the apparent outcome of the decision of Geoffery Hobbs QC in a recent sitting as the Appointed Person on an appeal from the Trade Marks Registry.

However, as is often the case, the decision is not quite so straightforward. This recent ruling examined the case of an attempt to apply to register the mark VISA by a Malaysian company, CA Sheimer (M) Sdn Bhd, and the opposition to the application by Visa International. There were several strange circumstances which contributed to the demise of Sheimer' s application.

Sheimer had registered a trade mark VISA in 1984 for condoms and other related articles - not including blankets or coverings. In 1995, Visa commenced a revocation action for non-use of this mark at which point Sheimer made a fresh application with a similar specification for the word mark VISA. In 1996, Sheimer surrendered the first mark prior to exchange of evidence being completed in the revocation action. It would appear therefore that Sheimer thought that Visa' s application for revocation was viable and likely to succeed.

Part of the evidence that was filed in relation to the revocation action related to the import of the VISA condoms. Sheimer claimed in their first round of evidence that a Mr Zarecky, who was based in London, had acted as the distributor of the condoms between 1988 and 1992. In other words, Sheimer claimed to have been using the mark within the 5 year period of non-use required for the revocation action to succeed. However, Mr Zarecky denied all knowledge of any dealings with Sheimer whatsover. He said in a statement filed on behalf of Visa Inernational that "[he had] never heard of a Malaysian company called Sheimer nor of VISA condoms and [he had] never had any dealings with [Sheimer] or such products. [He] certainly did not enter into any distributorship agreement with Sheimer nor act as a distributor for their products under any other arrangement." It was after this evidence had been filed that Sheimer surrendered their mark.

The matter was not left there. Visa International filed an opposition to Sheimer' s new application. They sought primarily to show that the application should fail under section 5(3) of the Trade Marks Act 1994 which provides that

"A trade mark which

(a) is identical or similar to an earlier trade mark ; and
(b) is to be registered for goods or services which are not similar to those for which the earlier trade mark is protected

shall not be registered if, or to the extent that, the earlier trade mark has:

[c] a reputation in the UK (or in the case of a Community Trade Mark, the EU); and
[d] the use of the later mark without due cause would take unfair advantage of or be detrimental to, the distinctive character or the repute of the earlier trade mark."

The evidence Sheimer adduced in the opposition included two packets of condoms that Sheimer claimed had been marketed throughout the whole of the United Kingdom under the trade mark VISA between 1988 and 1992 by Mr Zareky. Invoices for only 360 condoms in total were produced which is one for every 165,000 people. This did not really substantiate Sheimer' s claim that the condoms had been widely distributed.

The typeface used on the packs was, uncannily, almost identical to the mark used by Visa International (the only difference was a small left "flick" on the "V" in Visa International' s mark). Sheimer' s evidence did not respond to this. It was held that although Sheimer had provided examples of new packaging using a different typeface, there was evidence that the mark had been used (and therefore could in future be used) in a way which was identical or similar to the Visa International registration.

Visa claimed further that the application had been made in bad faith (which is an absolute ground for refusal under section 3(6) of the Act) and that Sheimer was attempting to take unfair advantage of Visa International' s prior registered mark. Counsel on behalf of Sheimer claimed that the reason for registering VISA for condoms was that it was a pun on "Permit to entry" and references to Visa International were therefore entirely coincidental. However, this story of the origin of the mark did not appear in any of the evidence and so was rejected as being unsustainable.

Hobbs QC held that "Sheimer wanted and expected people to link its use of the word VISA to Visa International' s use of the word VISA... Sheimer wanted to use a famous name for its products so that they would become famous for being products of the same name as the name whose fame they fed upon." There was no convincing evidence to suggest that this allegation was not true and accordingly it was held that a finding of bad faith was justified - although this was in no way a case which tested the limits of bad faith.

Given the underlying history, this case did not push out the boundaries as to how far a famous brand could stop others registering their name for goods and services for which the famous brand had no intention of registering. The applicant in this case was held to be in bad faith, supporting the conclusion that it was attempting to take advantage of the repute of the earlier mark as required by section 5(3) of the Act. There was compelling evidence to support this and a dearth of evidence to refute it. It does not therefore push open the floodgates in relation to the power of the big brands any further than before. But it would not be advisable for anyone to try to register VISA for condoms in the near future.

First published in WIPR in September 2000.