Reported Trade Mark and Copyright Cases for April 2001

25 April 2001

Katharine Stephens


 BL No.


 Earlier Mark



 O/324/00 MER MERYL Bags and umbrellas; shoes and clothing (18, 25)Opposition failed under ss 5(2)(b), 5(3) and 5(4). Confusion between the marks was highly unlikely given the visual, aural and conceptual differences, even if both words were seen as invented and even if the hearing officer was wrong in relation to enhanced reputation of the opponent's mark.
 O/336/00 CABLECO[CABLE & WIRELESS - objection on descriptive grounds]Data communications equipment and hardware; electrical cables and cable assemblies, networking devices (9)Opposition succeeded under section 3(1)(b). Although the applicant's mark was capable of distinguishing, it was devoid of any distinctive character. 'Co' would not, as the applicant contended, be understood by the public as an abbreviation for Cornwall, but a shortened form for company. The use made of the mark had not made it distinctive.
 O/337/00 FROSTIESFROSTIES (registered for cereal preparations (30))Boiled sweets and gum sweets (30)Opposition succeeded under section 3(6). An agreement to always use the mark FROSTIES in close proximity to the word TREBOR prevented the applicant from obtaining registration for the mark, either because the applicant did not intend to use the mark alone or because it went against the spirit of the agreement between the parties and therefore fell below the standard of acceptable commercial behaviour.

1 Indicates goods or services of the applicant only, unless those of the opponent are identical or so close as to be considered identical.

Polo Lauren Company LP v. The Royal County of Berkshire Polo Club (Hobbs Q.C.; BL O/335/00)

The appointed person, allowed the appeal against the decision of the hearing officer, following which the application for 10 ROYAL BERKSHIRE POLO CLUB & device proceeded in class 3 for perfumery etc. Polo Lauren's opposition based on various POLO marks registered in class 3 for perfumery failed under section 5(2). It was agreed that if the opposition failed under section 5(2), section 5(4) would add nothing further and therefore was dropped from consideration. The evidence indicated that the opponent's mark enjoyed a high degree of popularity amongst purchasers of toiletries. But, to the question of whether the normal and fair use of the application would capture the distinctiveness of the opponent's mark and give rise to the required likelihood of confusion, the answer was no. "The average consumer" would notice that the application comprised more than the word POLO, that it represented that the ROYAL BERKSHIRE POLO CLUB was responsible for the goods and that the word POLO was incorporated into the phrase as an adjective (compared to the opponent's mark which would probably be taken for a noun).

Oral-B Laboratories v. Wisdom Toothbrushes Ltd (Walker, Parker L.JJ., Sir Ronald Waterhouse; 15.11.00)

Oral-B applied in 1994 to register CONTURA (under the Trade Marks Act 1938). Wisdom applied in 1995 to register WISDOM CONTOUR. Both applications were for class 21. Each party opposed the other's application. Oral-B opposed Wisdom's application on relative grounds under section 5 of the 1994 Act on the basis of its own application.  Wisdom opposed Oral-B's application on the basis that CONTURA was too similar to the word CONTOUR which was commonly used in the toothbrush industry to describe the shape of toothbrushes. Before Laddie J.(CIPA January 2000) Wisdom's opposition succeeded and he held Oral-B's application should not be registered in either Parts A or B of the Register. Consequently, the opposition to Wisdom's application fell away. Both parties cross-appealed.

The Court of Appeal upheld Laddie J.'s decision. There was no compelling reason to interfere with his decision. The court had a discretion to order registration in Part B if opposition proceedings led to a refusal to register in Part A. However, it was only appropriate to exercise such a discretion where cases were borderline and evidence of distinctiveness had been produced. This case was not borderline and there was no evidence of distinctiveness produced.


Kangol Ltd v. Kango Products (Hobbs Q.C.; BL O/338/00)

The appeal to the appointed person for a declaration of invalidity to be set aside was refused. The application for invalidity was made on the basis that the proprietor's mark, KANGO T-TREE SHAMPOO (and kangaroo device), should have been refused under section 5(2)(b) in view of the applicant's prior registration for KANGOL (and kangaroo device). Both were registered in class 3 for hair care products. Although the visual differences to the marks (and depictions of kangaroo devices) were sufficient to distinguish them on one level, the words KANGO and KANGOL were sufficiently dominant for it to be appropriate to consider their aural similarity. The similarity was sufficient for there to be a likelihood of confusion.

Exclusive licences - House of Lords refers questions to ECJ

Scandecor Development AB v. Scandecor Marketing AB & ors (Lords Nicholls, Steyn, Hobhouse, Millett, Scott; 04.04.01)

This dispute arose out of the break up of the business of Scandecor International. Scandecor International was the proprietor of two trade marks, a word mark, SCANDECOR, and a device mark, both registered in class 16. Scandecor International had appointed Scandecor Marketing as its exclusive distributor of posters in, among other countries, the UK. International had also licensed Marketing to use the marks on the latter's calendars and cards. When International became insolvent, the business, including the trade marks, was purchased by Scandecor Development. The insolvency also terminated the distribution and licence agreement with Marketing. Development commenced a trade mark infringement action against Marketing for continued use of the marks in the UK. Marketing applied to revoke the marks on the basis that they were misleading as to origin (section 46(1)(d)/Article 12(2)(b) of the Directive), at least in relation to calendars and cards because Development was and never had been the source of origin of these goods and had never exercised any control over their quality (i.e. it was a bare licence).

The question which the House of Lords had to decide was whether use of a mark by an exclusive, bare licensee was objectionable as inherently likely to deceive. Under the 1994 Act, a trade mark is an indication of origin. However, the Act does not answer the question of who is that origin or source. On the whole, the Lords preferred the view that the source is the business source, i.e. the person, who, for the time being is entitled to use the mark, whether it be the proprietor or the exclusive licensee. When seeing goods to which a trade mark had been affixed, customers would understand that the goods had been produced either by the proprietor or by someone else acting with the proprietor's consent. Customers would also assume that the licensee as well as the proprietor, was likely to have an interest in maintaining the value of the brand name. Customers were not to be taken to rely on the protection supposedly afforded by a legal requirement that the proprietor must always retain and exercise an inherently imprecise degree of control over the licensee's activities.

The practical implications were that, during the period of a licence, even though the mark was considered by some customers to be distinctive of the exclusive licensee, this did not mean that it became deceptive or that it lacked distinctiveness. However, once the licence ended, and the mark reverted to the licensor, the question arose as to whether the mark became deceptive. Had the licensee accrued sufficient reputation under the mark that any trade thereafter by the licensee without using the mark would be deceptive? If so, then the grant of every exclusive licence could potentially put the mark at risk.

As the views expressed by the Lords represented a significant change to English law and since there was no Community jurisprudence on the point, the Lords referred the following question to the ECJ:

1. Is a trade mark to be regarded as liable to mislead the public within the meaning of Article 12(2) (b) if the origin of the goods denoted by the mark is a bare licensee?

2. What are the criteria to be applied in determining whether a trading relationship comprises a single undertaking for the purposes of the Directive? [This question goes to the issue of when Marketing became a separate undertaking for the purposes of section 1(1)/Article 2. Was it when the licence was granted or International's insolvency?]

3. Is a company a person for the purpose of Article 6(1)(a) of the Directive? [In other words, does Marketing have an own name defence?]

4. Article 12 of the Directive provides that a trade mark shall be 'liable' to revocation in specified circumstances. When those circumstances exist, must the court revoke the trade mark, or does the court retain any discretion as to whether to revoke.

Parallel Imports

Zino Davidoff SA v. A&G Imports LtdLevi Strauss & Co & anr v. Tesco Stores and ors (Opinion of A.G. Stikx-Hackl for the ECJ; 05.04.01)

Various questions were referred by the High Court to the ECJ in the above cases. The questions related to grey imports and international exhaustion of rights. Silhouette [1998] FSR 474 and Sebago [2000] RPC 63, established that, firstly, Article 7(1) precludes national rules that provide for the international exhaustion of trade mark rights. Secondly, Sebago added that the legal consequence of exhaustion can arise only if consent to first marketing extends to each individual item of the goods. However those cases did not address what constituted 'consent' under Articles 5(1) and 7(1). A.G. Stikx-Hackl expressed the following opinions.

Article 5 and 7 embody a complete harmonisation of the rules relating to trade mark infringement and exhaustion regardless of whether the goods were placed on the market inside or outside the EEA. It was unclear whether the word 'consent' in Articles 5(1) and 7(1) had the same meaning. However, Article 7(1) is a restriction on the ability of the proprietor to bring an infringement action under Article 5(1) and therefore the questions referred to the ECJ were to be considered in the light of Article 7(1).

Consent should not be construed as a matter of national law (either lex fori or the governing law of the contract), but as a matter of Community law. To allow otherwise might be to allow the re-importation of international exhaustion by the back door given the possible number of distributors in the chain before the goods entered the Community and the number of contracts. The application of Community law was in the interests of harmonisation. The A.G. therefore rejected, amongst other submissions of the parallel importers, the argument based on property law that the proprietor was only able to limit the title given to a licensee if he expressly reserved certain rights to himself. She also rejected the related argument that the proprietor could only indicate his reservation of rights by indelibly marking the goods. This was because consent to the placing of goods on the market does not depend upon the transfer of rights, but on the exercise of those rights.

What therefore is needed for consent under Community law? Consent is not equivalent to contractual intention when entering into an agreement, although goods are often put on the market under the terms of an agreement. Therefore, the A.G. considered the older cases on exhaustion e.g. Deutsche Grammophon [1971] ECR 487, decided under what are now Articles 28 and 30 EC. Through these emerged the principle of attribution i.e. the goods were placed on the market in the EEA by the proprietor or that action could be attributed to him when it came to the legal consequences arising from exhaustion. When considering whether such action could be attributed to the proprietor, the court had regard to certain objective criteria, such as the behaviour of the proprietor and whether he had, or could have availed himself of, an opportunity to exercise his rights of exclusivity within the EEA.

However, Article 7(1) could not necessarily be construed in the same way as Articles 28 and 30, since Sebago suggested a distinction between situations where the goods were first placed on the market in the EEA and situations where they were first placed on the market outside the EEA. Article 7 did not have as its purpose the harmonisation of the free movement of goods worldwide. Indiscriminate application of Article 7(1) would not take account of the different starting positions, i.e. within the EEA the transfer of the power of disposal of the goods coincides with the first placing of the goods on the market, whereas it does not coincide with the first placing of the goods on the market outside the EEA. This factual difference gives rise to different possibilities over the control of the distribution chain.

In Sebago, the ECJ focused on the proprietor controlling the initial marketing of the goods in the EEA. The ECJ did not mean direct control of companies within the same group or of a licensee, but rather meant the determining, enforcing or monitoring of the distribution chain. Therefore, consent to the placing of goods on the market cannot be assumed in so far as the proprietor has not had any opportunity to control the initial marketing within the EEA of the products bearing the trade mark.

However, this does not mean that the proprietor can always claim that his rights are not exhausted if the goods are put on the market outside the EEA. Rather, the principle of free movement has to be balanced against the need to protect the trade mark and in so doing, the proprietor's conduct has to be examined to consider whether, in the circumstances of the case, subsequent purchasers were led to believe that the proprietor had waived his exclusive rights to first market within the EEA. The trade mark owner cannot exercise his trade mark rights to a single degree beyond what is necessary to safeguard the rights which form the specific subject matter conferred by the trade mark.

If for example, the proprietor had lost control of the distribution of the goods in countries outside the EEA, he might try to reimpose control at the time they were first marketed within the EEA by way of sales bans, territorial restrictions on purchasers' rights of disposal, export bans etc. Depending on the form of these measures, they may give rise to legitimate expectations in the minds of subsequent purchasers which merit protection. In all this, the proprietor cannot act at variance with his own conduct when the goods were actually first placed on the market. It is up to the national courts to decide whether the proprietor has waived his rights. However, the bar must not be set too high so that the proprietor is always taken to have waived his rights.

The A.G. also considered various points under Article 7(2) and was of the opinion that legitimate reasons which justify a trade mark proprietor in opposing further commercialisation of products bearing the trade mark include any actions of third parties (including the removal of bar codes) which seriously affect the value, allure or image of the trade mark or the products which bear that mark.

Zino Davidoff SA v. M & S Toiletries Ltd (Court of Session (Scotland), Lord McCluskey; 08.08.00)

The defender had purchased from a supplier within the EEA, parallel imports from the Far East which bore the pursuer's trade mark. The defender claimed not to be aware that the goods had not originated from within the EEA because the bar codes that would have revealed this fact had been defaced. The defender therefore claimed that it was not aware that it was infringing the pursuer's rights. However, Lord McCluskey held that the tampering with the bar codes indicated an attempt to "facilitate some invasion of the prima facie right of the pursuers under the Directive". He therefore granted an interim interdict to prevent further dealing by the defender in DAVIDOFF brand perfumes, regardless of their origin.

Passing off

Lawyers Online Limited v. Lawyeronline Ltd (Judge Boggis Q.C.; 07.07.00)

The claimant had generated sufficient goodwill in the 22 months it had been operating under the name LAWYERS ONLINE and its domain name, LAWYERSONLINE.CO.UK, and the damage that would be suffered by the claimant as a result of the defendant's activities being misleading was such that it was appropriate to grant an interim injunction to prevent the defendant from operating under the similar name LAWYER ONLINE through the domain name LAWYERONLINE.CO.UK. A cross undertaking as to damages from the principal operator of the claimant to the defendant was acceptable where the claimant itself was not financially sound, as was the case here.

British Broadcasting Corporation v. Talksport Ltd (Blackburne J.; 19.06.00)

The BBC had sole rights to radio broadcast live in-stadium commentary from Euro 2000. The defendant attempted to circumvent its lack of licence by producing contemporaneous commentary based on live TV pictures viewed in an Amsterdam studio and by adding appropriate in-stadium sound effects. This made the commentary appear to be live from the stadium when it was not. This type of broadcast was known as "off-tube". The BBC objected to the broadcast being described as "live". In previous hearing before the court, the defendant had given undertakings to make it clear that the coverage was off-tube, although inadvertent uses by presenters of the word "live", where the defendant had reasonably endeavoured to prevent such use, were not to be considered in breach of the undertakings.

In this further application, the BBC complained of the use of the dubbing to make the broadcast appear live. Blackburne J. agreed that there was a misrepresentation that the broadcast was taking place from inside the stadium, that is, it was a live broadcast, despite Talksport's regular use of the following disclaimer: "This is Talksport, not the BBC, with unofficial full match commentary on [Portugal v. England] on Talksport, courtesy of our TV monitors at the Talksport Amsterdam Studio". However, he held that the BBC's attempt to support their claim to the goodwill ultimately amounted to the claimant trying to protect the descriptive word "live". There was no goodwill in purely descriptive words. Furthermore, no damage was shown to have been incurred. The interim injunction would not be granted.

Passing Off/Trade mark infringement

Arsenal Football Club plc v. Matthew Reed (Laddie J.; 06.04.01)

The claimant was a well known football team and was the proprietor of the registered marks, ARSENAL, GUNNERS, a crest device and a cannon device, in many different classes (the "Marks"). The defendant had traded for 31 years as a vendor of football souvenirs and memorabilia, particularly relating to Arsenal FC. The defendant had a number of stalls near Arsenal's ground at Highbury at which he sold his goods. By this action for passing off and trade mark infringement, the claimant sought to stop the sale of unlicensed goods by the defendant.

The claimant made two claims of passing off against the defendant:

1. sales of unlicensed products bearing the Marks would mislead the public into believing that the products were produced or licensed by, or associated or connected with, the claimant; and

2. an employee of the defendant deliberately tried to deceive customers by falsely representing an unlicensed product as being 'official'.

With regard to the first claim, Laddie J. considered that since the defendant had been carrying on his trade for some considerable time, any confusion and/or damage should be readily ascertainable. The claimant did not present any evidence of confusion, despite obviously being aware of the desirability of such evidence. Laddie J. concluded that this was because there was none. As there had been no confusion, there had been no damage and the passing off claim failed. There were also various factors which made confusion less likely on the facts, such as the use of disclaimers, although these factors were not determinative of the issue of confusion in itself. As to the second claim, it was held on the facts that it was likely that there had been a misunderstanding. The employee seemed to be 'honest' and had strongly denied having sold the product as 'official'. The claim failed.

Further, Laddie J. held that the defendant's use of the Marks on the products was not use as a trade mark, not being indicative of trade origin.

Laddie J. further mentioned that confusion must occur amongst the relevant public and went on to identify two groups of potential customers: one which bought products bearing the Marks because they functioned as signs of allegiance to the team, and one which would want to buy official merchandise to support financially the team, but which would also purchase the products to function as signs of allegiance.

Turning to the trade mark infringement action, the defendant accepted that the words and designs he used were identical or sufficiently similar to the Marks to amount to infringement under sections 10(1) or 10(2), but only if all other statutory requirements were fulfilled. However, there was an ambiguity in section 10 and in the underlying Directive, which refers only to use of a 'sign', and the defendant claimed that in order for infringement to take place, the defendant must use the sign as a trade mark. He claimed that the Marks were not used as trade marks on his products but as badges of allegiance. Laddie J. agreed that potential customers would perceive the signs on the defendant's products as signs of support and allegiance, and not as signs of trade origin.

In order therefore for there to be trade mark infringement, section 10 and the Directive had to be construed such that non-trade mark use would infringe. The law in this area was unclear. The Court of Appeal had decided in Philips v. Remington [1999] RPC 809 that infringing use did not have to be use in a trade mark sense and Laddie J. felt unable to offer a different view. Such a view would have to come from the House of Lords or the ECJ. The Advocate General's opinion in Philips v. Remington (CIPA February 2001) offered no help, and accordingly Laddie J. decided he could not rule on the issue of infringement until the ECJ had clarified the point.He decided to hear Counsel on whether he should refer to the ECJ, and if so the form of the reference, or whether the Court of Appeal should consider the matter first.

The defendant claimed invalidity under section 46 for non-use and section 47 for being incapable of distinguishing in a trade mark sense. Both claims were rejected. As regards section 46, Laddie J. held that the claimant had not just used the signs in the way in which the defendant had used them, but had also used them in a trade mark sense on swing tickets, neck labels and packaging. The relevant customer would perceive that as trade mark use. As for section 47, there was no reason why trade mark use could not be distinctive simply because the signs could also be used in other, non-trade mark ways.


Stoddard International plc v. William Lomas Carpets Ltd (Pumfrey J.; 19.01.01

The defendant's carpet design was sufficiently similar to that of the claimant to raise a case of copying that had to be answered. However, the defendant's designer was found not to have copied the design of the claimant or to have been given such a restrictive brief as to give him little option but to produce a design that was likely to be at least a near copy of the claimant's design. The action was dismissed.

Pumfrey J. found that there was no copying in relation to the key carpet design in question. Mr Haley, the defendant's designer, had said that his design was restricted by the brief he had received. However, Pumfrey J. asked the question "If a designer receives a brief which can reasonably be expected to cover something rather like the copyright work, and goes ahead and, without knowledge of the copyright work, produces a number of designs, one of which is similar to the copyright work, is the person who selects the closest guilty of a copyright infringement? The answer to this question is that it is a matter of degree. If the brief is sufficiently constraining on the designer, he becomes a mere amanuensis of the person writing the brief." In such a case, it was held, the designer would need to be left practically no freedom at all. Here, it was held that Mr Haley had sufficient freedom for the defendant not to be found liable for copyright infringement.

Written by Katharine Stephens and Rebecca Harrison.