easyJet experiences significant turbulence over Colombia

In easyGroup Ltd v Empresa Aérea de Servicios y Facilitatión Logística Integral S.A. - EasyFly S.A. and Anor [2020] EWHC 40 (Ch), the English High Court made life anything but easy for easyGroup. The judgment from Mr Justice Nugee contains some interesting lessons for lawyers both in the UK and in the EU (for, sadly, this distinction is now one that must be made...)

Background

Readers may remember easyGroup (an avid builder and zealous defender of IP rights) from any number of previous reported cases. EasyGroup owns a family of "easy-" brands, including the relevant brand in this case: easyJet.

The Defendants operate an airline called "easyfly", which flies domestic routes in Colombia only. Why, then, was the English court involved? In 2018, easyfly agreed to acquire five turboprop aircraft from ATR, a manufacturer based in France (and a joint venture between Airbus SE and Leonardo SpA). This led to several alleged acts of trade mark infringement: (i) a press release announcing the purchase (and containing a quote from Snr Ávila, President of easyfly) was published on ATR's website and made available in hard copy at the Farnborough (UK) air show (this was allegedly approved by easyfly); and (ii) easyfly's logo (below) was applied to the aircraft and the aircraft were flown through EU airspace during test flights and on their way to Colombia. EasyGroup argued that ATR was jointly liable with the defendants for these alleged infringements, and therefore sought to add ATR to the action (the claim against easyfly began in early 2018).

EasyGroup alleged three further acts of infringement against easyfly only: (iii) allowing consumers in the EU to buy easyfly tickets; (iv) direct email marketing to EU-based consumers who provided their email addresses to easyfly; and (v) targeting of the easyfly.com.co website (which is in Spanish) at EU-based consumers.

EasyGroup initially was granted permission to serve proceedings out of the jurisdiction on easyfly in February 2018. Due to alleged deficiencies in easyGroup's application, easyfly applied to have such permission set aside, the claim struck out or proceedings transferred to the IPEC.

Jurisdiction over easyfly

As easyfly is based in Colombia, easyGroup required the court's permission to serve proceedings out of the jurisdiction. The requirements for permission to be granted are: (a) there is a serious issue to be tried on the merits; (b) there is a good arguable case that the claim falls within one or more of the jurisdictional gateways; and (c) England (and Wales) is the most appropriate forum for the dispute. Regarding (b) and (c), EasyGroup's claim was based on both UK and EU trade marks. The English court was the natural place to hear a claim regarding UK marks. It also had jurisdiction to hear a claim regarding EU trade marks under the jurisdictional "cascade" contained in Article 125(2) EUTMR, because easyGroup is domiciled in the UK (and therefore the court would have jurisdiction to grant pan-EU relief under Article 126(1)(a) EUTMR).

The key debate, therefore, was whether there was a serious issue to be tried in relation to the alleged acts of infringement (i) to (v); more specifically whether one or more of the acts arguably targeted consumers in the UK and/or EU (the authorities are clear that mere accessibility, which may attract "occasional interest from anywhere in the world", is not sufficient).

EasyGroup relied on several factors to support its allegation of targeting, including the fact that "easy" is not a Spanish word (together with easyfly's partly-orange branding); the fact the majority of easyJet customers are based in the UK/EU (and that many of them speak Spanish or have access to online translators); an English-language Facebook page; acceptance of international credit card payments; provision of an international dialling code (which may have been used by EU-based customers); and one instance of alleged actual confusion.

Easyfly argued that the fact it is a domestic airline and therefore that its services are only performed in Colombia gave easyfly a defence to infringement. The judge was unconvinced. The key question is whether the alleged infringer uses the allegedly infringing sign in the course of trade in the UK/EU. This is a broader concept that the location where the goods or, particularly, services are supplied. The example given by easyGroup's counsel and repeated by the judge is a good one: a business selling trekking holidays in the Himalayas to consumers in the UK under the sign "North Face"; this would, presumably, infringe trade marks for THE NORTH FACE registered in the UK/EU.

Although there was some debate regarding the underlying facts of the alleged infringements, the judge was prepared to find on the above basis that there was a serious issue to be tried in respect of all five alleged acts of infringement. Regarding passing off, easyfly argued that easyfly's actions might (at most) cause "muddle and wonder" among consumers, not misrepresentation/deception. The judge disagreed (again, there was a serious issue to be tried) but did suggest that some elements of easyGroup's claim might be ambitious.

But...

None of this mattered, though. EasyGroup originally applied for permission from the court to serve proceedings on easyfly out of the jurisdiction without notice to easyfly. Therefore, easyGroup had a duty of full and frank disclosure. The witness statement from easyGroup's solicitor in support of the application failed to disclose a number of matters. These omissions were not serious, but the statement also gave the impression that easyfly might be offering flights between the EU and Colombia (which was not the case); failed specifically to draw the judge's attention to an exhibited letter from easyfly's Colombian lawyers which contradicted this impression; and similarly failed to draw attention to easyfly's explicit denial of marketing towards the EU.

These latter three issues were serious. Combined with easyGroup's failure to articulate clearly the grounds on which it alleged that easyfly targeted the UK/EU, these failings were enough for the judge to rule that easyGroup had fallen short of the standard of full and frank disclosure. The consequence? The order for permission to serve out of the jurisdiction was set aside (and easyGroup therefore would have to re-apply for permission at a later date).

Jursidiction over ATR

The order to set aside killed the proceedings and made it impossible to join ATR. Nevertheless, Nugee J took out a judicial insurance policy and went on to consider the position of ATR.

After some debate, it was agreed that the question of whether the court should give permission to join ATR would be determined by the same standard as service on any out-of-jurisdiction defendant i.e. factors (a) to (c) above. As a reminder, ATR was potentially on the hook for (i) the press release; and (ii) aircraft branding.

Unlike easyfly, ATR is domiciled in the EU and, therefore, under Article 125 EUTMR easyGroup had the choice of suing ATR in its Member State of domicile (France) or in the Member State in which the act of infringement occurred (Article 125(5)). In respect of the aircraft branding, the Member States overflown were France and Spain, and so (despite easyGroup's counsel's valiant attempts to steer the court away from the lex specialis EUTMR jurisdictional provisions and towards Brussels Recast) the English court had no jurisdiction over ATR. Although, in principle, the English court would have jurisdiction in respect of the press release made available at Farnborough, the judge held that the 15 or so copies of the press release were de minimis and there was no threat to republish so, if he had to decide the point (which he did not given the set-aside), he would not have given permission to join ATR to proceedings. Finally, easyGroup's attempt to join ATR via a claim for conspiracy failed: there were no relevant agreements between easyfly and ATR concluded in England, and any damage suffered by easyGroup would have been suffered in France or Spain, and not in England.

Comment 

Above all else, this judgment shows that the concept of "targeting" is broad and flexible. When and if there is a judgment on the merits, it will be interesting to see how many of the allegedly infringing acts are found to be infringing [this GuestKat will place a bet now on (iv) and (v), but not (i)-(iii)].

In the meantime, the procedural history of this case serves as a reminder that a decent/arguable case on the merits will not overcome those pesky procedural and jurisdictional rules, at least as far as the English court is concerned. A failure to comply with the duty of full and frank disclosure that accompanies a without notice application is particularly egregious, but it is also interesting that easyGroup joined the growing number of parties who have tried (without success) to carve around the inconvenient strictures of the jurisdictional cascade under the EUTMR. 

As an aside, in its argument that easyfly targeted the UK/EU, easyGroup relied on an earlier judgment of a Colombian court in a trade mark infringement claim brought by easyfly against easyGroup and easyJet (the court found that easyfly was aware of easyJet's existence at the time of registering the easyfly brand in Colombia). Given what has followed, perhaps it would have been better for easyfly not to poke this particular bear, even on easyfly's home ground...