From October 2016 to March 2017 the team is joined by Guest Kats Rosie Burbidge and Eibhlin Vardy, and by InternKats Verónica Rodríguez Arguijo, Tian Lu and Hayleigh Bosher.

Monday, 29 February 2016

Lord Justice Kitchin gleefully keeps us the right side up on "wrong way around" evidence in Fox trade mark appeal

Looking out for IP judgments sometimes requires
the help of the AmeriKat's fuzzy friends
There are often occasions where the AmeriKat spies an interesting decision that she would love to digest and share with readers, but then a shinier, more attractive IP decision takes her fancy.  The Court of Appeal decision in the Glee trade mark and passing off case was one of these cases that got bumped down her list.  However, the ever-dependable Kat friend, Eibhlin Vardy (A&O), has come to the rescue with her take on the Court of Appeal's decision:  
"Earlier this month, the Court of Appeal rejected an appeal and cross-appeal in the long running trade mark and passing off dispute between Comic Enterprises and 20th Century Fox (Comic Enterprises Ltd v Twentieth Century Fox Film Corporation [2016] EWCA Civ 41), previously reported on IP Kat here, here and here. The Court of Appeal considered certain issues afresh, and its reasoning is instructive, particularly in relation to 'wrong way round' confusion evidence.
To recap, Comic Enterprises provides stand up comedy, music, and entertainment in several venues in the UK which it calls 'glee' clubs. It holds a registered UK trade mark- dating back to 2001 - which consists of a series of two device marks (see below):

This trade mark was partially revoked at first instance for non-use, with the specification limited to the following services in class 41: "Live comedy services, night club and cabaret entertainment; music hall services; provision of live and recorded music; dancing; provision of facilities for comedy and music entertainment; production and presentation of live shows and displays and the presentation of sound recordings". At first instance, Fox challenged the validity of the mark on the basis that this contained a descriptive element but this was not pursued on appeal. In addition to its registered mark, Comic Enterprises promotes its business in the UK using the words 'glee', 'the Glee Club' and through marketing emails referred to as 'Gleemails'.
Since December 2009, Fox has produced the highly successful 'glee' TV show, a 'pop culture phenomenon', with accompanying DVD and album sales/downloads, and sales of glee TV merchandise in the UK.

At first instance, Mr Roger Wyand QC sitting as a deputy judge in the High Court held that Fox had infringed Comic Enterprises' trade mark under s10(2)(b) and s10(3) of the Trade Marks Act 1994, but that Comic Enterprises could not sustain a claim in passing off against Fox. Various remedies were ordered, including an injunction to prevent Fox using word 'glee' as the name of the TV series (except to say the show was formerly known as 'glee'). Fox appealed on the findings of trade mark infringement, and Comic Enterprises cross-appealed on the finding that there was no passing off in relation to the signs 'the Glee Club' and 'glee'.
Wrong way round evidence of confusion and s10(2)(b) 
There was a significant volume of 'wrong way round' evidence of confusion at trial. This came from a range of individuals who knew of Fox's TV series, and on seeing or hearing of Comic Enterprises' business, believed it to be connected to the TV series. Fox alleged that this wrong way round evidence weighed significantly in the judge's finding of infringement, when it should have been irrelevant to the issue of trade mark infringement both as a matter of fact and as a matter of law. Fox also alleged that the High Court did not address the dissimilarity of services for which the mark is registered, and those for which Fox used the sign 'glee'. 
Lord Justice Kitchin accepted that the judge's reasoning on the probative value of wrong way round confusion evidence was very brief in parts. In particular, he had not properly addressed whether confusion arose because of the similarity of the sign to the mark, and the similarity of the services covered by the mark (with its more limited specification) and those services in relation to which the sign had been used. The Court of Appeal reviewed this evidence in detail afresh, and made its own assessment as to whether the various witnesses would have been aware of the services being offered by Comic Enterprises.

The Court of Appeal's starting point was the statutory test. The question is whether there is a likelihood of confusion on the part of the public because the sign is the same as or similar to the registered mark and is used in relation to goods identical with or similar to those for which the mark is registered. The Court of Appeal reiterated that the interdependence principle should be considered as part of this assessment, i.e. a lesser degree of similarity between the services may be offset by a greater similarity between marks (and vice versa).
Not your average stag do....
The witness evidence put forward by Comic Enterprises was varied and provides light entertainment in itself. It included evidence from a marketing agent who had been invited to pitch for promotional work for Comic Enterprises' Nottingham venue, and who had wrongly assumed that there was a link with Fox's TV series. When the agent was ultimately engaged by Comic Enterprises, she adopted the slogan 'we are Glee and we're not on TV' to try and distinguish Comic Enterprises' Nottingham venue from Fox's TV series. Tourists in Oxford were spotted taking photographs of Comic Enterprises' Glee Club sign outside premises - likely due to an association with the TV series. One (presumably anxious) stag party participant had enquired, upon arrival at a Comic Enterprises' venue, whether it was going to be a 'singing and dancing' night because of confusion with Fox's TV series. Comic Enterprises encountered significant confusion surrounding its Oxford venue, and distributed 2,500 flyers to dispel any link to the TV series. 
The Court of Appeal determined that the wrong way round confusion evidence was admissible. Lord Justice Kitchin noted that the distinction between 'wrong' and 'right' way round evidence may be nothing more meaningful than the order in which a particular consumer happens to come across the mark and the sign. The Court should assess the probative value of wrong way round evidence in the usual way to determine whether it assists in answering the statutory question of infringement. This seems to be correct - there is nothing in the statute which dictates that the average consumer must consider the signs/mark and respective services in a particular chronological order.
On the facts, there was a reasonable degree of similarity between the mark and the sign, and although Fox maintained that there was a clear distinction between a recorded TV series and live comedy and music in terms of the services covered, this was rejected by the Court of Appeal (particularly given that Fox had itself sanctioned world tours demonstrating that live music and comedy shows can be complementary to a TV series). Fox also argued that the context of use of the sign was important, and it was far-fetched to suggest that consumers would think that Comic Enterprises would be behind the Glee TV series. Although the Court of Appeal agreed this was unlikely, it was much more likely that potential consumers of Comic Enterprise would conclude that Fox was linked to Comic Enterprises' UK entertainment venues.
Lord Justice Kitchin acknowledged that the assessment of confusion based on the degree of similarity between the mark and sign, and the degree of similarity between the services of the mark and sign, initially appeared finely balanced. However, the evidence of actual confusion put forward by comic Enterprises was potentially very persuasive, and supported a finding of likelihood of confusion and infringement under s10(2)(b) of the Act.
Infringement under s10(3) of the Act 
Lord Justice Kitchin - keeping us
the right way up about
the wrong way around
There was no challenge on appeal as to whether Comic Enterprises had reputation in the mark by late 2009. Fox argued that wrong way round evidence should be excluded, because infringement under s10(3) is based on the mark having a reputation in the UK and therefore infringement should be considered from that perspective. Again, the Court of Appeal disagreed, noting that it was inevitable that many consumers would come across Fox's TV series before they came across the mark, but the evidence before the Court demonstrated that the use by Fox of the sign was such that an average consumer would likely make a connection between the sign and the mark. Lord Justice Kitchin noted that "the protection afforded to a mark with a reputation extends beyond existing customers". The evidence showed that actual and potential customers were conflating the businesses of the parties, and affecting Comic Enterprises' ability to use the mark to promote its business, particularly in seeking to establish new venues in Nottingham and Oxford where it did not already have a significant customer base. The judge was entitled to find that potential consumers were changing their economic behaviour. The mark was suffering detriment because it was being swamped by Fox's use of the glee sign.
Passing off
The Court of Appeal confirmed the judge's finding that there was no passing off. In doing so, it noted that it is important to keep in mind the distinction between confusion and misrepresentation. Use of the sign in relation to Fox's TV series shows was likely to cause confusion, but this did not mean that Fox was guilty of any actionable misrepresentation. Kitchin LJ noted that the real problems concerning the use of the sign only came to light when Comic Enterprises launched new venues in Oxford and Nottingham after Fox's TV show was already up and running. The Court reiterated that the scope of protection in passing off is not the same as trade mark infringement. The decision of the judge at first instance to find trade mark infringement but not passing off was not inherently inconsistent on the facts.
Don't Stop Believin'
Mr Fox hasn't seen the inside of a court room since he beat
his manslaughter rap following Mr Wolf's
ill-fated demise
This is unlikely to be the final episode of this dispute. Fox alleged on appeal that the registered mark was invalid on the basis that s41 of the Act (which allows a series of marks to be registered) is incompatible with the requirement that a trade mark must be a 'sign' in the sense of being a single sign and capable of being graphically represented pursuant to articles 2 and 3 of Directive 2008/95/EC. At trial, Fox reserved this point for appeal, but to be advanced on a contingency only basis in the event that it was unsuccessful on other matters on appeal. During the course of the appeal hearing, the Court recognised that this point was of some general importance and may be of interest to the UK IPO, which was invited to make written observations on this point. Although the UK IPO responded exceptionally promptly to the effect that s41 was not incompatible with the Directive, the Court of Appeal decided to reserve consideration of this issue to a later occasion to enable the parties to respond to the UK IPO's observations. In addition to the outstanding s41 challenge, the thorny question of Comic Enterprises' damages or an account of profits remains."

1 comment:

Anonymous said...

Question: When will it dawn on directors of British companies that procuring registration of a "trade mark" inspired by something from the common vocabulary is going to have an "ugly result"? Answer: When it dawns on directors of British companies that NOT procuring registration of a slogan/logo/emblem inspired by something from the common vocabulary is going to have an "ugly result". Conclusion: Damned if you do, damned if you don't. The Flying Music Company Ltd and Jack Wills Limited did. Michael Jackson and House of Fraser didn't.

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