BEAUTY & THE BAY not an infringement of BEAUTY BAY, says High Court

Last month the High Court of Justice of England and Wales issued a judgment concerning trade mark infringement and passing off. It is Beauty Bay and Dotcom Retail v Benefit Cosmetics [2019] EWHC 1150 (Ch).

In a nutshell, the court ruled that use of the sign BEAUTY & THE BAY by Benefit would not infringe the BEAUTY BAY trade marks owned by Beauty Bay, and would not amount to passing off.

Background

Beauty Bay (the claimant, acting together with its licensor) is the registered owner of a number of UK and EU marks. In particular, it is the proprietor of the word marks BEAUTY BAY and BEAUTYBAY for goods and services in Classes 3 and 35 of the Nice Classification. The claimant also acts as an online retailer of cosmetics, beauty products and accessories, trading under the said marks.

The defendant, Benefit, is a global manufacturer and retailer of cosmetics owned by luxury conglomerate LVMH and based in San Francisco, USA (the action was targeted against its UK subsidiary).

The dispute arose when the defendant sold a Christmas set that consisted of items contained in a globe-shaped gift box. This product formed part of a larger set, intended to celebrate its San Francisco heritage and mark the 50th anniversary of the Summer of Love. In this regard, the products in the globe-shaped box were a collection of the defendant’s best-selling beauty products:

By selling the set, the claimants submitted that the defendant had infringed the Beauty Bay trade marks, also by causing detriment to their distinctive character and taking unfair advantage of their repute, and committed passing off.

Besides an initial revocation counterclaim (then discontinued), the defendant argued that:

• The Benefit mark appeared prominently on the base of the box itself, and this serves to indicate to consumers that the product originated from Benefit and no one else;
• “Beauty & the Bay” would be understood by the average consumer as being a clear play on the expression “Beauty and the Beast”, and
• No consumer faced with the product would sensibly conclude that BEAUTY & THE BAY has any other commercial origin if not Benefit's.

Trade mark infringement under Article 9(2)(b): preliminary remarks

The judge only dealt with the EUTMR, considering the identity of the corresponding provisions in the UK Trade Marks Act.

Article 9(2)(b) EUTMR sets out that a trade mark proprietor is entitled to prevent third parties not having its consent from using a similar/identical in the course of trade if there exists a likelihood of confusion on part of the public with the registered trade mark. In Comic Enterprises Ltd v Twentieth Century Fox Film Corporation [2016] EWCA Civ 41, Kitchin J (as he then was), set out six conditions that must be satisfied for there to be an infringement:

(i) there must be use of a sign by a third party within the relevant territory;

(ii) the use must be in the course of trade;

(iii) it must be without the consent of the proprietor;

(iv) it must be of a sign which is identical with or similar to the trade mark;

(v) it must be in relation to goods or services which are identical with or similar to those for which the trade mark is registered; and

(vi) it must give rise to a likelihood of confusion.

Only two of these conditions are in issue in this case. Benefit contends that neither (v) nor (vi) would be satisfied.

As a preliminary remark, the court also recalled that the concept of the average consumer was recently considered in London Taxi Corporation Ltd v Frazer-Nash Research Limited [2017] EWCA Civ 1729. In that case, the Court of Appeal of England Wales considered that the notion of 'average consumer' is that of anyone at whom the guarantee of origin is directed and who would be likely to rely on it, for example in making a decision to buy or use the goods. In this regard, it is not a question of averaging the different categories of consumers, but rather considering the typical consumer in each category. The average consumer is deemed to be reasonably well-informed and reasonably observant and circumspect.

Merpel is not entirely happy
with her make up

Assessment

Applying the above to the facts at issue, the court considered that BEAUTY & THE BAY is used as a brand to differentiate the product at hand from other products offered by the defendant. The Benefit logo is relatively small compared to BEAUTY & THE BAY, which is in much larger font. The defendant further relied on the fact that its product was sold through Benefit stores where the staff is trained to engage with customers in a particular way (the so-called ‘Magic Formula’). This meant that that there was no confusion since customers were always made aware that the products within the Benefit concessions are Benefit’s own products.

The court disagreed and held that, whilst some shoppers may get treated to the Magic Formula, it is extremely unlikely that all or even most shoppers would receive such personal attention. As a result, condition (v) was deemed satisfied.

Turning to likelihood of confusion (condition (vi)), the court recalled that this requires a global appreciation, taking into account all relevant factors, and must be undertaken from the perspective of the average consumer (see Comic Enterprises Ltd v Twentieth Century Fox Film Corporation [2016] EWCA Civ 41).

Benefit submitted that no such likelihood of confusion would subsist because of case law (notably Nestle v Cadbury C-215/14) on “limping marks”. As a result, the alleged infringement would be merely a descriptive phrase that would be viewed as such and/or as purely decorative, because it has only been used in conjunction with the Benefit name and marks.

The court disagreed, and found that the claimants were not wrong in submitting that the average consumer might think that there was a collaboration between them and Benefit. However, based on all the relevant circumstances at issue, the court concluded that no likelihood of confusion could be established. As a result, no trade mark infringement was found to subsist.

Trade mark infringement under Article 9(2)(c) and passing off

Turning to the second ground for infringement, the court recalled once again the criteria established in Comic Enterprises, and found that the issues here revolved around reputation, the link, injury and due cause. The court excluded that such conditions would be satisfied. As a result, no infringement under Article 9(2)(c) was found either.

Similarly, the court excluded passing off, since no likelihood of confusion could be established under Article 9(2)(b).