[Guest post] Retromark Volume X: the last six months in trade marks

Darren Meale of Simmons & Simmons presents the tenth volume in his rundown of notable trade mark cases over the past six months. Here we go!

Retromark Volume X: the last six months in trade marks

by Darren Meale

Retromark turns ten volumes, making it about four and a half human years old. That’s roughly 30 in dog years and closer to mid-30s in cat years (apparently). A lot has changed over that time, but the trade mark cases keep coming.

Here’s another 10 highlights for your consideration.

1. No turn around for the fortunes of Chanel’s double-C

Chanel v EUIPO Case T-44/20 EU General Court (April 2021)

Does Chanel’s famous double-C logo conflict with this one filed by Chinese smartphone manufacturer Huawei?

You can see where this is going. The EUIPO Opposition Division rejected the opposition because the signs were not similar, it was not permissible to perform a 90-degree rotation “because figurative marks are not protected – as word marks – in all different typefaces and positions. Rather, they are assessed solely in the form applied for.” The EUIPO Board of Appeal reached the same conclusion. Earlier this year the EU General Court made it three for three.

Given in use a trade mark could be viewed at all sorts of angles, especially when attached to goods as a swing tag (the Huawei application covered glasses and watches among other things), this series of judgments seems narrow-minded. I wonder if the same decision would have been reached if the marks were more complex, such as depictions of a cartoon character. Is it not an infringement as long as Mickey Mouse is upside down?

IPKat here.

2. SkyKick’s back with a bad faith shocker from the Court of Appeal

Sky v SkyKick [2021] EWCA Civ 1121 (July 2021)

I covered the latest (ninth) SkyKick judgement in this IPKat post back in the summer. While those eight other judgments didn’t do SkyKick much good, they did at least end in a consolidation prize by way of Sky having a tiny bit of its trade marks narrowed down on the grounds of bad faith, plus a costs order which saved SkyKick having to pay Sky £1.52m.

The ninth judgment reversed the bad faith finding. In an unexpected decision, Sir Christopher Floyd led the Court of Appeal to, in essence, approve Sky’s practice of filing voluminous trade mark applications covering things it never intended to use its marks for.

In my view the judgment is controversial and arguably misses the bigger picture, including the cumulative impact of more and more broadly drafted registrations on the practice of trade marks. SkyKick has said it would appeal – again – this time to the UK Supreme Court. At the time of writing, there was no news on whether the Supreme Court will grant it permission to do so.

3. One in a Million Litecoins: a new cause of action against conflicting trade marks?

Litecoin Foundation Limited v (1) Inshallah Limited (2) Nasjet Limited (3) John Pepin [2021] EWHC 1998 (Ch) (July 2021)

Litecoin is a cryptocurrency, promoted and developed by the claimant. The defendants (who had a history of obtaining “opportunistic” registrations of domain names and trade marks) registered LITECOIN as a UK trade mark some years after Litecoin’s launch but before the claimant did. When the defendants refused to give up the mark, the claimant brought a claim in the IPEC for an injunction to prohibit the defendants’ use of the mark. The pleaded cause of action was passing off. The claimant said that by stating in their trade mark application their bona fide intention to use the mark, they caused the public to believe they were associated with the claimant. The application was made in bad faith and was an “instrument of fraud”, relying on BT v One in a Million [1999] 1 WLR 903, which established that domain names registered by squatters were instruments of fraud and their registration could amount to passing off even without any active use of them.

District Judge Hart (on the IPEC Small Claims track) gave a first instance judgment on 25 March 2020 agreeing with the claimant, but granted permission to appeal.

An appeal was heard by the High Court, John Kimbell QC sitting as an Enterprise Judge. He upheld DJ Hart’s judgment.

It is surprising that it has taken more than 20 years for One in a Million to be applied to a trade mark application. That it has now been so applied makes perfect sense and there is little reason to treat a domain name registration differently from a trade mark application in this context. The same could also apply to a company registration.

Is this a new cause of action for us trade mark lawyers to start waving around? Perhaps. Few opponents prefer to jump straight into court action, with oppositions typically the preference when a cease and desist letter fails to get the right reaction. A registration can already be attacked post-registration in court as well as at the UKIPO, but a pre-grant opposition can only be filed at the UKIPO. A passing off action could perhaps also have been filed by the claimant on the basis of threatened use of the mark using the same arguments that helped win the day on an instrument of fraud basis, although arguably the “new” method does not require the claimant to establish every element of passing off.

It is worth noting that this claim did not deal with the actual trade mark registration, which appears to have been separately opposed (the opposition likely stayed while the case was in the courts). This was on the register until the end of last year, the applicant withdrew it on 21 November 2021.

4. The General Court gives lipstick shape mark a French kiss

Guerlain v EUIPO Case T-488/20 EU General Court (July 2021)

Shape marks haven’t fared well in Retromark coverage over the years. Most of the time the UKIPO and the EUIPO look at them and say “we should not treat these any differently” and then treat them differently and reject them. Surprise then that the rounded cylindrical lipstick depicted below has been ruled distinctive and registerable by the General Court, overturning the EUIPO Board of Appeal.

The decision is presently only available in French, so if you don’t trust Google Translate see the IPKat’s piece here. Applying the well-established test of “does the shape depart significantly from the norms or customs of the sector concerned”, the General Court concluded that the shape, apparently reminiscent of a “boat hull, a bassinet or an overturned ingot” (d’une coque de bateau, d’un couffin ou d’un lingot renversé), will cause the relevant public to “be surprised by this easily memorized shape”. Thus it did depart significantly from the norms, and it was distinctive.

I am very much in favour of a more liberal approach to non-traditional marks, but this mark has done well to achieve registration. I have seen much more deserving marks, in Retromark and in practice, which have not fared so well.

5. First sound mark case fizzles out in the EU General Court

Ardagh Metal Beverage Holdings v EUIPO Case T-668/19 EU General Court (July 2021)

Retromark does have a penchant for non-traditional marks cases. This one concerns a type of mark that I daresay most trade mark lawyers will never have the pleasure of applying for – a sound mark.

I understand this was the first judgment at the General Court level or above dealing with sound marks. The judgment is available in almost every EU language bar English, so I report from a machine translation of the French version. You can listen to the sound applied for here. It is 14 seconds and was applied for beverages amongst other goods. It is literally the sound of a can being opened and a carbonated beverage fizzing. That’s it.

There is clearly nothing distinctive about this mark at all. Sadly, the EU trade mark system is entirely lacking in an effective mechanism for putting a quick stop to pointless litigation, so it took several years and decisions of the EUIPO, the EUIPO Board of Appeal and finally the EU General Court to put this one to bed (in theory there could be an appeal to the CJEU, but I think probably not). Quite what the applicant (and its lawyers) was thinking pursuing this is beyond me – perhaps they had ambitious plans to drive around Europe obtaining PIs against bar owners.

6. The drinks are on Eagle Rare as the Court of Appeal grounds American Eagle

Liverpool Gin Distillery Ltd v Sazerac Brands [2021] EWCA Civ 1207 (August 2021)

In Volume 8 I described how the High Court, in the form of Mr Justice Fancourt, decided that an AMERICAN EAGLE bourbon whiskey infringed Sazerac’s rights in EAGLE RARE for whiskey as it would indirectly confuse consumers into believing the two brands were connected. This, I remarked, granted an effective monopoly in the word EAGLE (being the only shared element of the two brand names) notwithstanding the judge’s recognition that Sazerac was not entitled to such a monopoly. The judge was persuaded that having been the first to the UK market with an EAGLE-formative name, and it being common for connected brands to have similar names, the UK public would make the connection here.

The Court of Appeal, led by Lord Justice Arnold (supported by IP specialist Birss LJ and non IP-specialist Laing LJ) has supported Fancourt J and upheld his decision. Arnold LJ reviewed the law and the first instance judgment in a succinct 26 paragraphs. It took him only a further 18 to reject the appeal. The judge’s decision was a multi-factorial evaluation which could only be interfered with if he erred in law or in principle. Criticisms of the judge’s decision advanced by Liverpool Gin were explored and dismissed, with Arnold LJ ultimately concluding that even if they were well founded, the judge was entitled to take the view he did. Arnold LJ concludes: “I consider that he was right to infer that there was a likelihood of some consumers thinking that EAGLE RARE was a special version of AMERICAN EAGLE.”

So there you have it. For me, this remains a questionable outcome. I think it is an example (and not the only example) of a trade mark being given too broad a scope of protection by the English courts. It is also an illustration of how trade mark cases are so often decided: by the trial judge’s own evaluation of the facts and the trial judge’s personal choice. Once that is made, it is very difficult to convince an appellant court to overturn it and reach its own view.

7. Oat no is isn’t! [This pun would have worked better if I posted this before Christmas]

Oatly AB & Oatly UK Limited v Glebe Farm Foods Limited [2021] EWHC 2189 (IPEC) (August 2021)

Trade mark cases don’t often hit the mainstream press, but this one made all the headlines. Most IP lawyers dread reading about their cases in a newspaper, what with journalists’ infamous ability to speak of copyrighting a trade mark in a patent dispute. Here, Oatly tried to stop PUREOATY and failed. The Guardian, the BBC and the FT all covered the case, summarising it fairly well – although all three spelt “trademark” as one word (ARGH!).

There are too many recent examples of pro-trade mark owner decisions which go too far, including where the marks include descriptive elements or elements with low distinctiveness. I am pleased to say this isn’t one of them. Here, the suit, brought by milk-substitute market leader Oatly, included broadly four claims (1) that the word marks were too close and would confuse; (2) that the packaging of PureOaty was too close to a device registration for Oatly’s packaging; (3) that PureOaty took unfair advantage of Oatly’s reputation in both its word and packaging marks; and (4) that there was passing off.

Nicholas Caddick QC sitting as a Deputy High Court Judge in the IPEC dismissed all of the claims. He rightly concluded that the only coinciding elements of the word marks was the word OAT, which was entirely descriptive. The other and (more) distinct elements of the marks – PURE and the -LY suffix – were very different. There would be no confusion. The judge considered the claims based on the packaging to be weaker, there were only very high level similarities and overall the packaging contained features which increased the distinction between the two products. The 10(3) claim failed – Oatly enjoyed “a significant and extensive distinctive character and reputation”, there was a link between OATLY and PUREOATY, but there was no injury including no unfair advantage. PureOaty had no intention of taking advantage of Oatly’s reputation. Unsurprisingly in light of the outcome of the trade mark claims, the passing off claim failed too.

This is a sensible, well-structured judgment which makes perfect sense to me. I expect to return again to the paragraphs which explain how the Court should deal with trade marks which share descriptive elements – see 56 to 58, citing Daniel Alexander QC in Planetart (covered in Volume 8).

8. Brexit ruined my trade mark dispute! The UK government to the belated rescue

Indo European Foods Ltd v EUIPO Case T-342/20 EU General Court (November 2021)

One of the many horrible things about Brexit was finding your opposition at the EUIPO based only on a UKTM summarily dismissed shortly after the Brexit transition period ended on 31 December 2020. In respect of almost literally every other consideration, the EUIPO will decide an opposition based on the law and facts that existed at the date the opposition was filed. For what may have been entirely political reasons, this was not the case in respect of UK trade marks upon Brexit, even if your dispute had been pending for years.

In Indo European Foods, UK passing off was relied upon to oppose an EUTM application pre-Brexit. The opposition was rejected at the EUIPO Opposition Division and Board of Appeal levels on the merits and not because of Brexit. At the EU General Court, the court considered whether it could still hear the case now that Brexit had passed. It concluded that, because the two earlier decisions came before the end of the transition period, it could do so.

The possibly more important question which was not answered here was what should be the case if the first decision came after the end of the transition period. As noted above, the EUIPO went ahead and dismissed a number of cases without hesitation, but I thought this wrong and subject to challenge. I haven’t seen a challenge of it yet, but given the speed at which cases move through the EU trade mark court system, one or more could still be on the way. IPKat here.

The impact of the EUIPO’s above stance has also had a knock-on effect on the UK register. The UKIPO took a different approach and allowed EUTMs to be used to challenge UKTMs filed up until the end of the transition period and not to summarily strike those challenges out at the dawn of 2021. Like many things Brexit, that totally screwed some litigants who, without Brexit, would have prevailed at the EUIPO using their UKTM, knocked out the EUTM, and left their opponent with nothing to rely upon in the UK. Belatedly, the UK government has acted by passing the Trade Marks and International Trade Marks (Amendment) (EU Exit) Regulations 2021 (SI 2021/1235) with the UKIPO issuing Tribunal Practice Notice (1/2021). Mechanisms are now available to deal with this scenario and negate an obvious unfairness. The UKIPO estimates this correction will only impact 10-15 cases, but it will likely have a huge impact on those – potentially turning losers back into winners and vice versa.

9. Brexit ruined my trade mark practice! No rescue this time

Daimler AG v European Union Intellectual Property Office Case T-422/21 Order of the General Court (December 2021)

Another of the many horrible things about Brexit was how it removed the individual rights of audience of thousands of solicitors and barristers who had built careers out of representing clients before the EU trade mark courts. To Brexit supporters reading this, I do hope you got some tangible benefit in return for the damage you caused.

Daimler is a strange case. A UK patent attorney litigator and two UK barristers (from a well-known IP chambers) sought to appeal a decision of the EUIPO Board of Appeal relating to EUTM opposition proceedings between Daimler and Volkswagen to the EU General Court. Post-Brexit, as English representatives the EU General Court was never going to permit them to act and indeed it issued this reasoned order denying them rights of audience. The patent attorney litigator was not a “lawyer” within the relevant rules and so he was doubly precluded from acting. This case also clearly fell outside the limited exceptions to the post-Brexit rules, the most notable being the provision which allows lawyers who acted pre-Brexit to see a case through to its post-Brexit conclusion.

I say this case is odd because, no matter how disappointed by Brexit and its consequences us lawyers may be, the new rules are pretty clear and this attempt to run through them appears to have been hopeless. Was this a try on by the lawyers in question? Did they make a silly mistake or were they trying to make a point? Is there something going on that the reasoned order doesn’t reveal? Answers on a blue passport postcard please.

10. VAGISAN v VAGISIL – you don’t need me to tell you what body part this case was about (or do you?)

Combe International v Dr August Wolff GMBH & Co KG Arzneimittel [2021] EWHC 3347 (December 2021)

This case is largely self-explanatory once you read the trade marks involved. It is also a big dispute, already subject to decisions elsewhere including in the US and Australia. The English High Court has now found, just as the US Court of Appeals for the Fourth Circuit and the Full Court of the Federal Court of Australia did, that these two feminine hygiene brands are too close.

The claimant was owner of VAGISIL, a long-established product on the UK market since 1984. The defendant launched VAGISAN in the early 2000s (2013 in the UK). Coexistence discussions failed to yield an agreement and litigation ensued.

This is another case in which the marks share a descriptive element, but unlike the PUREOATY case above that has been held not to be enough to separate them in the eyes of the UK consumers. In reaching this conclusion, the judge, Mr Justice Adam Johnson, relied upon a number of factors including (1) lower end level attentiveness, in part because the average purchaser might be embarrassed about buying the product and not want to linger in a pharmacy; (2) the high degree of visual and aural similarity between the marks; and (3) the identity of the goods. As to the defendant’s contention that the VAGI/VAGIS element of the marks signposted to a treatment for vaginal conditions, the judge accepted they were “suggestive of the idea of the vagina” but not that VAGISIL therefore had only a low level of inherent distinctiveness. In any event, he found the mark had acquired distinctiveness by the relevant date, 2013, many years after the VAGISIL product’s launch. On the basis of these factors the judge held there was and is a likelihood of confusion.

The judge then went on to consider in detail the evidence of actual confusion. This included evidence that advertising campaigns for the defendant’s product led to increased sales of the claimant’s product. There was also evidence of confusion on Twitter following an advertising campaign for the defendant starring the comedian Jenny Éclair. The judge concluded he had “no real hesitation” finding actual confusion on top of a likelihood.

The defendants relied upon a trio of defences: statutory acquiescence (covered in some detail between paragraphs 170 and 254); descriptive use (255 to 264); the little used section 11(1) (265 to 269); and honest concurrent use (270 to 272). All failed, as did a request from the defendants for a declaration that a rebranding to DR WOLFF’s VAGISAN would not infringe.

Perhaps it is wrong to put this case in the same category as PUREOATY. The signposting argument failed – there wasn’t evidence that VAGI was used as a prefix to signpost consumers to vaginal healthcare products. Further, VAGISIL had acquired distinctiveness over decades. Finally, the judge had the privilege of significant evidence of, he found, actual confusion – typically not available in trade mark infringement cases.

That said, I can’t shake my own conclusion that both marks are largely descriptive and that consumers would immediately understand what they were from seeing the names in relation to feminine care products. In my view, marks with such characteristics may deserve protection, but should be afforded only a narrow scope of protection. If you select descriptive elements in your trade mark, you shouldn’t be able to object that others later pick the same ones.

***

And that’s it for now. A happy New Year to you all – fingers crossed our recent return to working from home is a short one, and that I see some of you in person soon enough!

Thanks to my colleague Lauren Stone for helping me collate this volume.

• 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
• Volume V – November 2018 to March 2019
• Volume VI – April 2019 to October 2019
• Volume VII – October 2019 to April 2020
• Volume VIII – April 2020 to October 2020
• Volume IX – November 2020 to May 2021