Reported Trade Mark Cases September 2007

12 October 2007

Katharine Stephens and Zoe Fuller

TRADE MARKS

Interim injunctions

Miss World Limited v Channel 4 Television Corporation (Pumfrey J; [2007] EWHC 982 (Pat); 16.04.07)

Pumfrey J granted an interim injunction to restrain the use of the words “Mr Miss World” for a programme about a transsexual beauty pageant in Thailand called “Miss International Queen”.

The claimant owned a UK trade mark registered in respect of services for the production of television programmes relating to contests and a CTM registered in respect of entertainment services, both for the words “Miss World”. The claimant alleged that the defendant’s use of the title “Mr Miss World” infringed the two marks under Sections 10(1), 10(2) and 10(3). The defendant argued that the use of the word “Mr” transformed the title from denoting that which the claimant provided and suggested a beauty pageant that was not the claimant’s.

In relation to the scope of the specification of goods, a television programme was certainly an entertainment service and therefore within the scope of the CTM. However, Pumfrey J was doubtful that the transmission of the show under the “Mr Miss World” name would infringe the UK mark, which related to production services.

Pumfrey J held that at least one use on the Channel 4 website, referring to the Miss International Queen event as “the Miss World event for transgenders”, was probably an infringing use under Section 10(1). However, the question of whether use of “Mr Miss World” constituted use of an identical mark remained. In this respect, Pumfrey J set out two contentions: Firstly, the words could be viewed as the mark Miss World with an intrabrand feature consisting of the word “Mr”, in which case Miss World would still be a distinct mark and there would be identity of marks. Alternatively, the words could be viewed as an ordinary composite mark in which the word “Mr” did nothing but qualify the Miss World part of the mark purely semantically, with the result that there was some indication that it was a different mark.

Pumfrey J held that Section 10(1) infringement was at least arguable even taking a narrow approach to the idea of identity. If this interpretation was incorrect the question became one of infringement under Section 10(2), for which there was a strongly arguable case: the marks were plainly similar and there would be relevant confusion through association due to the claimant’s extensive reputation in the words “Miss World”.

Pumfrey J commented that Section 10(3) raised the only real reason for requiring removal of the mark from the programme at such a late stage before transmission, rather than leaving the claimant to its remedy in damages. Central to the claimant’s complaint of infringement under Section 10(3) was the assertion that even if members of the public were not confused into the belief that the defendant was transmitting a Miss World production, they would still associate it with the claimant’s product; the use of the mark was parasitic upon the claimant’s reputation, which was unfair. While the defendant accepted that the Miss World mark had a reputation it argued that, since the case involved publication of a television programme, Article 10 of the European Convention on Human Rights was engaged and therefore Section 12(3) of the Human Rights Act 1998 applied. This section states that where the relief granted by a court might affect the exercise of the Convention right to freedom of expression “[n]o such relief is to be granted so as to restrain publication before trial unless the court is satisfied that the applicant is likely to establish that publication should not be allowed”.

Pumfrey J noted that the European Court of Human Rights has distinguished three types of expression: political, artistic and commercial. The court consistently attaches great importance to political expression and rather less to artistic and commercial expression. The relief here was not to restrain broadcast of the programme, but to do so using the words “Mr Miss World”. Pumfrey J was unpersuaded that such use gave rise to questions under Article 10; the name was essentially descriptive. However, in case Article 10 was in fact engaged, Pumfrey J considered whether the case was strong enough to satisfy the requirement imposed by Section 12(3). For this purpose, Pumfrey J considered the judgment in the House of Lords in Cream Holdings v Banerjee [2004] UKHL 44, and the meaning of the word “likely”. InCream Holdings, Lord Nicholls held that the degree of likelihood of success at trial needed to satisfy Section 12(3) must depend on the circumstances. The general approach was that the courts should be slow to make interim restraining orders unless the applicant showed that he was “more likely than not” to succeed at trial. But there would be cases where a lesser degree of likelihood would suffice.

Absent a sign that was a political point or identifying some matter of political importance, the idea that use of a trade mark could of itself generally engage Article 10 was a difficult one. Pumfrey J was satisfied that there was a strong arguable case of trading upon the goodwill and repute of the mark in an unfair manner and thus the requirement imposed by Section 12(3) was satisfied.

Regarding the balance of convenience, there had already been a number of objectionable uses in mass circulation newspapers and on the Internet. Further, editing the programme at this late stage would be difficult. On the other hand this was a late programming change: the claimant could not reasonably have been expected to find out about it any earlier and once it did find out, it had moved extremely quickly. The programme may leave a lasting impression, undesired by the claimants, and which could affect their relationship with sponsors. While editing the programme would be difficult, it was not impossible. The overall picture seemed to be one where an injunction was appropriate.

DESIGNS

Community Registered Designs - interpretation of “sector concerned”

Green Lane Products Limited v PMS International Limited (and others) and Poundland Limited*(Lewison J.; [2007] EWHC 1712 (Pat); 19.07.07)

In this preliminary ruling, Lewison J held that “the sector concerned” for the purposes of Article 7 of the Community Designs Regulation, should be interpreted as the sector that consists of or includes the sector of the alleged prior art. It is not limited to the sector specified in the application.

Green Lane Products Limited (GLP) owned four community registered designs in respect of spiky blue and pink balls with square or rounded nodes for use in tumble dryers to help soften clothes and quicken drying times. The designs were registered in 2004 in respect of “Flatirons and washing, cleaning and drying equipment”.

PMS International began selling spiky plastic balls in the EU in 2002 and marketed them as massage balls. In 2006 PMS began marketing the same balls as laundry dryer balls. GLP claimed infringement of their CRDs through the sale and marketing of PMS balls for anything other than use as massage balls. GLP relied on Article 10 which protects the design from use in any product even if that product was not specified in the application.

Under Article 7, any design is deemed to have been made available to the public if it has been published, exhibited, used in trade before the date of filing except where these events could not reasonably have been known in the normal course of business to the circles specialised in the sector concerned. The preliminary issue to be decided was the true construction of the “sector concerned”; namely whether is it (i) the sector corresponding to the product class indicated on the CRD application; or (ii) the sector of the prior art.

Lewison J found in favour of the latter. He held that if the former were correct, there would be several undesirable consequences, including the following:

  • An applicant may gain a monopoly over all classes of products if he registers his design in a product class with no prior art, even if prior art exists in other product classes.

  • The monopoly would make it unlawful to start using an “old and well known” design in another product class not specified in the application. In addition it could block a manufacturer which uses the design from changing distributors, as any new distributor will not be able to show prior use, thus freezing pre-existing business arrangements.

  • It could also enable an individual to extend the protection for the design beyond the 25 year maximum by re-registering it in a different product class where it had not been used before, thus prolonging the monopoly.

Lewison J also rejected GLP’s comparison of the characteristics and role of the informed user in Article 6 (which requires industry specific knowledge) with the purpose of Article 7, which is to identify the relevant prior art. The two are separate concepts and should not be conflated.

Lewison J finally held that the ‘circle’ for the purposes of Article 7 comprises all individuals who conduct trade in respect of products in that sector (including designers, manufacturers, advertisers and distributors), although Lewison J accepted that there may be circles which are more restrictive that this.

Design right – employee’s fiduciary duty

Helmet Integrated Systems Ltd v Tunnard & Otrs* (LJJ May, Lloyd & Moses; [2006] EWCA Civ 1735; 15.12.06) - Reported at [2007] FSR 437 (no. 16) and therefore only a short summary is provided.

The CoA held that a salesman who undertook preparatory activities to develop a concept which he intended to market in competition with his employer following his resignation was not under any fiduciary obligation to inform his employer of such activities. He was employed as a salesman, not a designer, and it was not in contemplation of either party that he would develop a product during the course of his employment. Although a fiduciary obligation may have arisen in relation to the deployment of information about a similar preparatory development by a competitor, no such fiduciary duties arose in relation to his own activities.

COPYRIGHT

Copyright in design documents

The Flashing Badge Company v Brian David Groves t/a Flashing Badges by Virgo and Virgo Distribution* (Rimer J.; [2007] EWHC 1372 (Ch); 14.06.07)

The claimant commissioned a graphic designer to design novelty badges bearing messages of a familiar type. The copyright in the designs for the badges were assigned to the claimant. A key feature of the design of each badge was that its outline shape followed the outline of the artistic design which formed the subject matter of the face of the badge. The defendant subsequently began to import virtually identical badges from China.

The issue was whether Section 51 of the CDPA 1988 provided a defence to a claim of infringement of the admitted copyright in the graphic design. Section 51 provides that it is not an infringement of any copyright in a design document for anything other than an artistic work or typeface to make an article to the design. For the purposes of Section 51, “design” excludes surface decoration.

Rimer J held that each drawing was a “design document” within the meaning of Section 51 which incorporated (a) a design for an artistic work; and (b) a design for something other than an artistic work, namely an article in the nature of a badge in the same outline shape as the artistic work. Section 51 has no relevance in respect of (a) (as it is a design for an artistic work) although it is relevant to (b) as a design for something other than an artistic work. Rimer J concluded that Section 51 can only apply to a copyright claim in the design minus the surface decoration; it provides no defence in respect of any infringement of the copyright in the graphic design which provides the surface decoration of the badges.

Rimer J distinguished the facts of the case from those of Lambretta Clothing Co Ltd v Teddy Smith (UK) Ltd [2005] RPC 88. In Lambretta the court found as a majority that on the special facts the colourway of a tracksuit top did form part of the “shape and configuration” of the design (rather than merely surface decoration) and could only exist as part of the clothing to which it was applied. By contrast, the artistic work on the face of the badges could exist independently to the shape of the badge and could be applied to any other substrate.

Consequently, Rimer J held that Section 51 afforded the defendant no defence to the claim and granted summary judgment.

Non-verbal copying

Michael Baigent & Richard Leigh v The Random House Group Ltd* (Mummery, Rix, Lloyd L.JJ.; [2007] EWCA Civ 247; 28.03.07)

The Claimants, two of the three the authors of The Holy Blood and The Holy Grail (“HBHG”), claimed that, in writing The Davinci Code (“DVC”), Dan Brown had copied the “Central Theme” of HBHG. Peter Smith J ([2006] EWHC (Ch) 719) held that there was no copyright infringement. On appeal, whilst not agreeing with some parts of the judgment, the Court of Appeal upheld the judge’s decision. All three judges gave judgment.

In approaching the appeal, the Court of Appeal had in mind the guidance of the House of Lords inDesigners’ Guild Ltd v Russel Williams (Textiles) Ltd [2000] 1 WLR 2416. The Court of Appeal should practice self restraint, particularly in relation to the issue of whether there has been copying of a substantial part of a work; something which the judge at first instance was in a much better position to assess.

Lloyd LJ summarised the judgment of Peter Smith J in the following terms:

  • “There is relevant material in HBHG which is also to be found in DVC, namely eleven of the Central Theme elements.

  • Mr Brown had access to HBHG at the time when he wrote the parts of DVC which included this common material.

  • Mr Brown based relevant parts of DVC … on material in HBHG.

  • Nevertheless, what he took from HBHG amounted to generalised propositions, at too high a level of abstraction to qualify for copyright protection, because it was not the product of the application of skill and labour by the authors of HBHG in the creation of their literary work. It lay on the wrong side of the line between ideas and their expression.

  • In any event (this being the judge’s principal ground for decision) although the relevant eleven Central Theme elements were to be found in both books, the claim depended on showing that the Central Theme propounded was a central theme of HBHG, sufficient to qualify as a substantial part of the work, albeit as a combination of features obtained by abstraction, as described by Lord Hoffmann in paragraph 24 of Designers’ Guild, and this assertion by the Claimants was not justified, because the Central Theme was not a theme of HBHG at all, but rather was no more than a selection of features of HBHG collated for forensic purposes rather than emerging from a fair reading of the book as a whole. The basis of the Claimants’ contention that the Central Theme was a substantial part depended entirely on showing that it was … really the central theme of the book. The judge rejected that contention on the facts. … it was [not] necessary for him to provide any further explanation for his conclusion that, whatever elements (if any) were copied from HBHG, they did not amount to a substantial part of it.”

As the Court of Appeal stated, no clear principle can be found in the case law in order to say how or where to draw the dividing line between the legitimate use of the ideas expressed in a copyright work and the unlawful copying of their expression.

The Court of Appeal rejected the Claimants’ submission that the judge had adopted the incorrect legal test in this case. It was submitted that the judge had required that there be copyright in the Central Theme in order for there to be infringement of HBHG on the basis of a substantial taking of that work.

The Court of Appeal warned that care had to be taken not to blur the distinction between the issues of subsistence and infringement. If a précis of a literary work were put forward as being an abstraction from the work which had been copied in breach of copyright, and if it were found to be a fair summary of the work, then it would be easy to conclude that, by creating the work as a whole, the author had expended time and effort in the creation of something which was fairly represented by the summary. The summary would not itself be the copyright work, but it would properly be regarded as the product of relevant skill and labour. In this case, the judge had held that the Central Theme was not such a summary. It could not therefore be treated as an indirect product of the skill and effort that went into the creation of HBHG. It followed that there was no substantial copying of the original work.

In his judgment, Mummery LJ warned against using potentially confusing expressions such as “textual copying” when trying to describe the nature of copying, although he did not have an objection to calling word for word copying “language copying”.

Look and feel infringement

Nova Productions Ltd v Mazooma Games Ltd* (Sir Andrew Morritt, Jacob and Lloyd L.JJ.; [2007] EWCA Civ 219; 14.03.07) – Reported at [2007] RPC 589 (no. 25)

The facts

The claimant had produced a successful coin-operated video game based on pool which allowed players to win cash prizes. It was the sort of game seen in pubs and arcades.

The defendants also produced video games based on pool aimed at the same sort of market. There were some similarities but the games played very differently. The defendants never had access to the claimant’s source code, but of course had the chance to play the claimant’s game, and knew the video games market in general.

In the High Court, the judge found that, of the instances of copying alleged, none owed anything to actual copying from the claimant’s game – though some features were inspired or affected by the claimant’s program. The fact that there were similarities was a result of the defendants’ general experience and knowledge of what was commonplace in the market.

The Court of Appeal’s analysis

The images stored as graphics in a program are obviously graphical works and protected as such by copyright. The claimant said that the sequence of such images was also protected. The Court of Appeal disagreed: moving images were protected by film copyright and a series of still images was just that and nothing more.

The code of software is of course protected as a literary work. The question was how far copyright would go in protecting the idea behind a literary work as opposed to the literal text (or code) itself. Again the Court of Appeal disagreed with the claimant’s arguments. There was no special case for computer programs such that their ideas – or combinations of their ideas – were protected. Copyright protected skill of a certain type – in the case of computer programs, it protected in particular the work that went into the programming, not the work that went into the general idea or ideas behind the program.

The Court of Appeal cited with approval the 2004 decision in Navitaire v easyJet. In that case the defendants had set out to replicate as closely as possible the functionality, look and feel of the claimant’s program, but the judge still found that there was no copyright infringement (other than for copying some of the icons). The Court of Appeal summarised the Navitaire judgment as meaning that:


“merely making a program which will emulate another but which in no way involves copying the program code or any of the program’s graphics is legitimate”.


Implications

A number of conclusions can be derived from this judgment, and also from the Navitaire case:

  • It now appears good law that simply copying what a program does and the way it does it is not infringing the copyright in that program

  • Copyright protects the work that goes into producing the work itself, in the case of computer programs, the work of coding, not necessarily the work of analysis on which the coding was based

  • Of course, if someone copies actual lines of code, or graphics such as icons, then this could well be copyright infringement.

Declarations of non-infringement

Point Solutions Limited v Focus Business Solutions Limited (Chadwick LJ, Hallett LJ, Lindsay J; [2007] EWCA Civ 14; 23/01/07)

The Court of Appeal dismissed Point’s appeal against the High Court’s decision ([2005] EWHC 3096 (Ch)) to refuse to grant Point declaration of non-infringement of copyright in Focus’s software.

Point’s allegation that Kirkham J’s approach to the question of non-infringement had been confused and riddled with errors was misconceived. Kirkham J was entitled to conclude that that she was not satisfied, on the balance of probabilities, that Point had demonstrated independent design of its software. Given this, Point’s other two grounds of appeal did not arise, however Chadwick LJ addressed them for completeness.

Chadwick LJ upheld Kirkham J’s finding that Point did not need the declaration of non-infringement, noting in particular that Point had available to it a sensible means of resolving the dispute without recourse to litigation: namely independent and confidential expert scrutiny to determine whether there had been copying. Further, a letter from Focus’s solicitors gave comfort to Point by stating that if expert scrutiny found that copying had not taken place, Focus would accept that there had been no infringement.

However, Chadwick LJ was not confident that Kirkham J would have been right - had she found copying - to refuse a declaration on discretionary grounds because that “would shut Focus out of any future claim”. Instead, Chadwick LJ concluded that once Focus had decided to go to trial without the expert report which Master Bragge had thought necessary, it was in no position to complain if, as a result of a finding at the trial that copying had not taken place, it was unable to bring a claim alleging copying in the future.

Finally, Chadwick LJ commented that the outcome of the proceedings was unsatisfactory, and would have been equally unsatisfactory had the decision gone the other way. He blamed this state of affairs on the way in which the parties had chosen to conduct the proceedings, in particular by choosing to deny the Judge the assistance of an expert’s report.

Parallel imports

Independiente Ltd & ots v Music Trading On-line (HK) Ltd & ots* (Evans-Lombe J; [2007] EWHC 533 (Ch); 20.03.07) – Reported at [2007] FSR 525 (no. 21) and therefore only a short summary is provided.

The claimants were manufacturers and suppliers of music records. The first defendant operated a website from which CDs and DVDs could be purchased. The parties had compromised an earlier dispute under which the defendants undertook not to supply any non-EEA CDs or DVDs from anywhere in the world to any customer in the UK. The first defendant sent non-EEA CDs and DVDs to customers in the UK from HK, but claimed that since, under its standard terms and conditions, property passed to the customer when it handed the CD or DVD to the HK postal authority, the customer was the one who put the product into circulation the UK. It was held that this proposition was incorrect; delivery took place when the CD or DVD was delivered to the customer in the UK under Section 32(4) of the Sale of Goods Act 1979. Consequently, the first defendant was found to be in breach of the undertaking, in contempt of court and an order for an enquiry as to damages was made.

PRIVACY

OBG Limited and others v Allen and others (also known as Douglas and Another v Hello! Limited and others) [2007] UKHL 21

This House of Lord judgment covers two separate areas of the law; privacy/confidence and the scope of the economic torts of (a) causing loss by unlawful means and (b) inducing breach of contract.

The Economic Torts

The House of Lords confirmed that the torts of causing loss by unlawful means and inducing breach of contract (also called the Lumley v Gye tort) were distinct torts, thus restoring the separation between the causes of action identified by Lord Watson in Allen v Flood [1898] AC 1.

Lord Hoffmann characterised the torts as follows:

Inducing Breach of Contract:

A breach of contract between the potential claimant and a third party, induced by the defendant (who is not a party to the contract), where that defendant knows that its actions will lead to breach of a specific contract of which it has knowledge.

Causing Loss by Unlawful Means:

This tort consists of acts intended (by the defendant) to cause loss to the claimant by interfering with the freedom of a third party in a way which is unlawful against that third party and which is intended to cause loss to the claimant.

With respect to intention, Lord Hoffmann reiterated the fact that the defendant can intend to cause loss to the potential claimant even though that loss is caused by the means by which the defendant achieved the end of enriching him or herself. He also stated that the defendant will not be liable for loss which is neither a desired end nor a means of attaining it, but merely a foreseeable consequence of the defendant's actions.

Lord Hoffmann considered that for the means to be considered as unlawful, they must be actionable at law by the third party, but there will be no liability for acts which do not affect the third party’s ability to deal with the claimant.

Privacy/Confidence

In a majority decision, Lord Hoffmann confirmed that the criteria set out by Megarry J in Coco v AN Clark (Engineers) Ltd [1969] RPC 41 @ 47 is still good law in respect of assessing whether or not a breach of confidence has occurred.

He also confirmed that the benefit of the obligation of confidence (in this case in relation to photographic images of a wedding) could be purchased by a third party (in this case by OK! from the Douglases) and that the obligation of confidence could then be enforced by that third party where the criteria in Coco v AN Clark are met.

Lord Hoffmann reiterated that one should not confuse the cause of action set out by the House of Lords in Campbell v MGN Ltd [2004] 2 AC 457 (and enshrined in Article 8 of the European Convention on Human Rights) with the protection of commercially confidential information.

Reporter’s note: We are grateful to our colleagues at Bird & Bird for their assistance with the preparation of this report: Alice Sculthorpe, Gavin Lawson, James Leeson and John Wyand.

We are also grateful to Richard Stephens of the Law Office of Richard Stephens for the summary of Nova v Mazooma.

ECJ and CFI decisions can be found at http://curia.eu.int/en/content/juris/index_form.htm and the reported cases marked * can be found at http://www.bailii.org/databases.html#ew.