Retromark Volume V: the last six months in trade marks

Hot on the heels of last month’s 2019 edition of the Retromark conference, reviewed here, comes the fifth (how times flies) edition of Darren Meale of Simmons & Simmons’ Retromark rundown of notable trade mark cases over the past six months. Links to the four previous editions are at the end of this post. Enjoy!

Retromark Volume V: the last six months in trade marks

1. Easyjet crash lands as shrimp shipper shakedown shut off

Easygroup v Easy Fly Express [2018] EWHC 3155 (November 2018)

You only need compare the two marks below to see what this one is about.

That’s not quite right. This was really about whether Bangladeshi airline EasyFly was actually doing anything in the jurisdiction. If so, and if easyJet had real prospects of success on the merits, easyJet would be granted permission to serve out of the jurisdiction.

EasyFly would win if easyJet could not show it was targeting the UK or elsewhere in the EU. Mr Justice Arnold reviewed the principles: accessibility from the UK is not enough; the test is objective but actual evidence of UK targeting may be relevant; all the circumstances must be evaluated; is it possible to buy goods from it and have them shipped to the UK; is GBP used as a currency; is there a UK telephone number; how many UK consumers visit the website; and so on.

Assessing the evidence, Arnold J concluded that there was no targeting of the UK by Easyfly. 98% of its flights were domestic. It had never flown to the EU and had no plans to do so. It has never had an EU customer. The website was in English but this was a global language and widely spoken in Bangladesh. Easyfly’s website reference to having “global reach for customers in… Europe” was taken to be advertising puff (in reality Easyfly flew live shrimp between Dhaka and places like Jessore). Only two out of 514 “likes” of its Facebook page were from the UK.

Permission to serve out of the jurisdiction denied. Now repeat after me 15 times, at speed: “She sells shrimp shipping from the seashore”.

2. Byzantine complexity in making sense of the relevance of class numbers

Pathway v Easygroup [2018] EWHC 3608 (December 2018)

Easygroup’s second appearance this volume is Pathway. As Mr Justice Carr began, “Unless familiar with the law of registered trade marks, you might think that it is relatively straightforward. Regrettably, you would be wrong.” Easygroup knocked out a couple of EASYOFFICE-formative registrations owned by Pathway. It won before the UKIPO and after a long delay (in part because of IP Translator), the High Court heard Pathway’s appeal.

There were two issues. The first was whether Pathway could put in late evidence of the prosecution history of its marks – the discussions it had with the UKIPO. Henry Carr J concluded that reference to prosecution history in trade mark cases “is the exception, and not the rule”, even more so than in patent cases. This was not a case in which that history was relevant. He also concluded that there had been ample opportunity for Pathway to adduce the evidence at first instance. Appeal denied on the first issue.

The second issue related to the Nice class system, something the judge described as “technical and arcane” (fair point, judge, but it’s all we’ve got). The UKIPO Hearing Officer construed certain services of the marks in suit in Class 35 – “provision of office facilities” and “rental of office space” by reference to the Nice Classification lists in Class 35, which led it to adopt a narrower interpretation of the specification than he would have had he merely relied on the natural and ordinary reading of the words used.

Henry Carr J’s provisional view was that “it is appropriate to use [the] class number as an aid to interpretation of the specification where the words used in the specification lack clarity and precision”, but that there was no need otherwise. In the present case, the terms used were clear and precise, so the fact they were classified in the registration in Class 35 was not relevant. That meant that the Hearing Officer had been wrong to adopt the narrower meaning. But alas this did not win the day for Pathway, because the judge went on to conclude that even on the correct interpretation of the services (this being why the view expressed was provisional, as it was not determinative), Pathway had not provided sufficient evidence to prove use. Appeal dismissed.

Not an easy judgment to work through, notwithstanding the judge’s valiant efforts to make this arcane topic readable. IPKat’s take is here.

3. Purple colour options not a series of marks, as Court of Appeal sinks Cadbury’s novel chocolate argument

Cadbury v The Comptroller General v Nestlé [2018] EWCA Civ 2715 (December 2018)

Mentioned briefly back in Volume I, the Court of Appeal has now brought an end to Cadbury’s hopes of keeping its UK registration for its colour purple going.

In 2013, Cadbury’s registration for Pantone 2685C “applied to the whole visible surface, or being the predominant colour applied to the whole visible surface, of the packaging of the goods” for chocolate was held invalid because it was not “a sign”. The use of “predominant” meant that it was void for lack of certainty and precision as it comprised multiple signs. Cadbury was unfortunate to find itself in this position – it had adopted this description at the invitation of the UKIPO when it applied for the mark in 1997. Cadbury’s ingenious solution to this otherwise registration-ending problem was to claim that the registration was, in fact, a series of marks under the UK’s almost unique system of permitting multiple marks to be registered under one registration number. As it was possible to delete a mark in the series, Cadbury thought it could deem the “predominant” wording one mark and delete it, getting rid of the problem. But, alas, the argument was rejected at all levels, culminating in Lord Justice Floyd concluding that that “it would be a potentially far-reaching step” to allow Cadbury’s request and one which “would give rise to grave difficulties for the examination of trade marks”. IPKat here.

The long-running nature of this case combined with Cadbury and Nestle’s equally endless battle over the 3D KitKat mark led me to award this case Epic Saga of the Year at the inaugural Retromark Awards at our recent event.

4. Poor evidence costs McDonald’s its BIG MAC in Supermac attack

Supermac’s (Holdings) Ltd v McDonald’s Cancellation No 14 788 C, EUIPO (January 2019)

Supermac’s and McDonald’s are locked in a variety of MAC burger battles. Supermac’s applied to cancel McDonald’s EUTM for BIG MAC which has long passed its initial five-year use grace period. It fell to McDonald’s to prove it had put the mark to genuine use in the EU for a variety of goods in Classes 29, 30 and 42 – including for “meat sandwiches” (ie, burger in a bun). Easy peasy right? McDonald’s failed, even for sandwiches, which Supermac’s had conceded had been dealt with sufficiently on the evidence. A look at the evidence does suggest a degree of complacency on McDonald’s (or its lawyers’) part – it was rather flimsy. McDonald’s have appealed, but the loss of protection for one of the most renowned names in fast food should serve as a stark reminder that, without proof, no one is famous in the eyes of the EUIPO. IPKat here and look out for my article in JIPLP.

5. Use of a mark in a company name results in a finding of “instrument of fraud”, just like for domain names

Bayerische Motoren Werke v BMW Telecommunications Limited, Benjamin Michael Whitehouse [2019] EWHC 411 (IPEC) (February 2019)

Benjamin Michael Whitehouse has the initials BMW. BMW is one of the world’s most well-known car manufacturers. Mr Whitehouse formed a company in 2011, BMWAssociates, for his “little one-man band telecom railway company”. After an exchange of letters, the parties signed a coexistence agreement by which BMWAssociates (not Mr Whitehouse) agreed to limit his use of BMW. In 2017, Mr Whitehouse formed BMW Telecommunications Limited (not a breach because Mr Whitehouse was not a party to the coexistence agreement). BWM sued for trade mark infringement and passing-off.

HHJ Hacon in the IPEC upheld the claim following BMW’s application for summary judgment. BWM sought successfully to apply by analogy the “instrument of fraud” principle from the classic domain name case, BT v One in a Million.

A simple enough case but one that may not have been needed had Mr Whitehouse been a party to the original coexistence agreement – “little one-man band” companies are precisely the type of infringer where one should seek personal undertakings from the controlling mind.

6. The red sole is valid and infringed, says the Court of The Hague

Christian Louboutin v Van Haren Schoenen BV C/09/450182 / HA ZA 13-999, Court of The Hague (February 2019)

For the first time Retromark strays beyond its UK/EU-level remit, in order to see the legendary red sole saga through to its conclusion in the Dutch courts. As reported by the IPKat here, this followed the CJEU’s decision last June that Louboutin’s registration did not consist exclusively of a shape (which would likely have led to it falling foul of the prohibition on registration of shapes which give substantial value to goods). The Court of The Hague applied this decision and upheld the registration meaning that Van Haren infringed it (this conclusion followed from its earlier findings in 2015).

Van Haren sought to resist this conclusion by raising, amongst other points, the issue in Textilis, which we cover below. The point was that EU trade mark law has changed such that the prohibition relating to shapes now extends to “the shape, or another characteristic”. If that new law applied to Louboutin’s mark, Van Haren argued the case should be stayed pending the CJEU’s resolution of Textilis, in which it is expected to rule on whether or not the changes to EU trade mark law have retrospective effect. The Dutch court refused a stay not because the argument did not have merit but because The Netherlands has yet to implement the new law, despite the deadline for doing so having passed. Naughty Netherlands! 

7. No retrospectivity for new EU trade mark law

Textilis v Svenskt Tenn Case C-21/18, CJEU (March 2019)

So do the changes in EU trade mark law introduced by the 2017 Regulation and 2015 Directive have retrospective effect? No, says the CJEU. The new law is not applicable to marks registered prior to it entering into force.

This case concerned an EU trade mark for a figurative mark for a variety of goods (including fabric and paper) which depicted maps of New York along with places in New York including MANHATTAN (see the small version below). The owner, Svenskt Tenn, sought to assert the mark against an alleged infringer, Textilis, in Sweden while also alleging copyright infringement. Textilis sought to declare the mark invalid on the basis that it is made up of a “shape which gives substantial value to the goods”, contrary to the old version of Article 7(1)(e)(iii) of the EUTM Regulation. Having confirmed that the old law applied, the CJEU went on to conclude that a mark such as this – consisting of two-dimensional decorative motifs – does not consist exclusively of a shape. The fact that the mark was also protected by copyright had no impact on this conclusion. Another one of those CJEU anti-climaxes, to which many may respond “I could have told you that”. Perhaps these cases will be more interesting when the new (and broader?) law applies. IPKat here.

8. Gleissner trumped as UKIPO keen to Make our TM system Great Again

Trump International v DTTM Operations [2019] EWHC 769 (March 2019)

It is hard to know who to root for in a bad faith trade mark battle between orange-faced MAGA-moron and president Donald Trump and trade mark and domain hoarder and possible confused robot Michael Gleissner. Gleissner (by his company Trump International Ltd) sought to register TRUMP TV and DTTM, now owner and manager of Trump’s trade mark portfolio (amongst other things), opposed. Gleissner was found in bad faith by the UKIPO and the matter was appealed to the High Court (there is a statutory right to do so and no prospect of success filter applies). After a thorough analysis of Gleissner’s fairly flimsy grounds of appeal, Mr Justice Henry Carr dismissed them, upholding the finding of bad faith and refusing Gleissner’s request to adduce new evidence (described at least in part as “not credible”).

The Comptroller of the UKIPO intervened to express concern that behaviour like that of Gleissner could bring the trade mark system into disrepute. Evidence was provided of the extent of Gleissner’s activities, including 49 unpaid UKIPO costs orders (one third of the entirety of unpaid costs orders). Guidance was sought from the court as to how these matters should be dealt with in the future, which the judge did at paragraph 85 of his judgment – this is worth a read in full if you come up against Gleissner.

9. Virgin on the Virginic – indirectly confusing on the second attempt

Virgin Enterprises Ltd v Virginic LLC [2019] EWHC 672 (March 2019)

It was 2015 in JW Spear v Zynga when the legendary Mr Justice Peter Smith decided that the marks SCRABBLE and SCRAMBLE were not similar, only to be overturned by the Court of Appeal. Many more surprising decisions have been made since, the latest being the UKIPO’s conclusion in an opposition that there was no likelihood of confusion between the marks VIRGINIC and VIRGIN for identical goods in Class 3.

Reviewing the UKIPO’s decision, Mr Justice Arnold in the High Court bumped up the Hearing Officer’s findings: VIRGIN had a “fairly high” degree of inherent distinctive character, rather than an “average” one, and the conceptual similarity between the marks was “fairly high”, not “medium” owing to the suffix-like nature of the “-IC” part of VIRGINIC.

Interestingly, as arguably a proponent of a wider interpretation of the Thomson Life principle (see the judge’s conclusions in Aveda), Arnold J held that it did not apply here. “VIRGINIC is not a composite mark consisting of two signs, one of which has a distinctive significance independent of the significance of the whole”, he held. Where Thomson Life does apply, in my view it is typically easier to establish a likelihood of confusion. It would follow from Arnold J’s comments that had the mark been VIRGIN ICE (for example), the principle would have applied, notwithstanding that this mark is further away from VIRGIN than VIRGINIC is. Don’t believe anyone who tells you that trade mark law is easy.

Virgin contended that this matter turned on a likelihood of “indirect” confusion (it did not push for a finding of direct confusion). This has been described as this thought process of the consumer “the later mark is different from the earlier mark, but also has something in common with it. Taking account of the common element in the context of the later mark as a whole, I conclude that it is another brand of the owner of the earlier mark”. The judgment contains a good summary of the types of indirect confusion which I dare say every trade mark lawyer should read. Having raised the similarities between the marks above, Arnold J was satisfied that he should re-assess the Hearing Officer’s finding on indirect confusion and conclude that, in fact, indirect confusion was likely.

For a 23-paragraph judgment, this is an extremely useful case study for how confusion between similar marks is assessed in practice. Go read it!

10. A difficult jurisdictional jumble: targeting is key, says Advocate General

AMS Neve v Heritage Audio Case C-172/18 (March 2019)

The background to this case is in Volumes I and III. The question before the Court of Justice is this: can an alleged EU trade mark infringer offering goods for sale on a website be sued in the courts of the Member State on whose territory the traders and consumers targeted by the website are situated? The answer, says Advocate General Szpunar, is yes.

The answer lies in the interpretation of Article 97(5) of the old EUTM Regulation (now found at Article 125(5) of the new EUTMR), which provides for jurisdiction in the “Member State in which the act of infringement has been committed”. The defendants argued that the CJEU judgments in Nintendo (September 2017) and Wintersteiger (April 2012) – which consider similar but different provisions of EU law on jurisdiction – should be followed. The AG said no. Following Nintendo, for example, would set a limit on jurisdiction to the place where the process of putting the offer for sale online by the defendant on its website was activated. Adopting such an approach would lead to scenarios in which no EU territory had jurisdiction.

Instead a “tailor-made” solution was required. This was to ask whether the public of a Member State was being targeted. It would not be enough merely that the website was accessible from that place. The AG listed some relevant factors which we have seen discussed in this context before (including in EasyFly, above) – is the particular Member State referred to, does the website use a country-specific top-level domain, are the prices in the national currency, is there a national telephone number.

To understand the full complexities of the judgment one must make it through 99 pretty hard-going paragraphs, so this summary is necessarily an oversimplification. The Court of Justice has the next say – as ever, it is free to follow or ignore the AG’s opinion. After that the case will go back to the IPEC to make the final factual decision. By then the AG’s opinion may be mere background, but the AG did offer his own view on the facts: he indicated he did not think the defendant, Heritage, was targeting the UK owing to the absence of the above factors from its website. The only UK-specific factor the AG could spot was that a third-party UK distributor was included on the website in a list of distributors. That was not enough, he opined.

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Thanks go to Amy Palmer for helping to compile this Volume’s featured cases.

Go retro on your Retromark:

• Volume I – April 2016 to March 2017
• Volume II – March 2017 to September 2017
• Volume III – November 2017 to April 2018
• Volume IV – May 2018 to October 2018