Tote Bags at Dawn: Bona vacantia, trade marks and copyright

A very IPEC decision (i.e. remarkably complex, colourful, and fairly low value) was handed down last week in Courtnay-Smith & Anor v The Notting Hill Shopping Bag Company Ltd & Ors [2025] EWHC 1793 (IPEC). 

It concerns tote bags and the Portobello Road market. It carries some interesting points, relevant to corporate restructures, about what happens when trade marks are owned by companies that are dissolved, and how both trade marks and goodwill can be lost. It also contains an interesting interpretation on copyright, and highlights some difficulties with the IPEC, which we have considered on the blog before (see here and here). 

Background

The case was between two suppliers of tote bags, and revolves around London's famous Portobello Market. The Claimants claimed to own registered and unregistered rights (copyright and goodwill) in the following sign (and the plain text equivalent):

At risk of oversimplifying things, the Claimants complained about the Defendants'  use of the following sign (and the plain text equivalent), and a near-identical trade mark application:

The dissolution of the company and the trade mark

The history is quite complicated but, in short, a company existed (The Notting Hill Shopping Bag Company Limited - the Dissolved Company) and was the registered proprietor of the trade mark, which was filed for in May 2013. That company was then dissolved in 2018, before being restored in September 2023. 

In March 2023, i.e. before the Dissolved Company was restored, an similarly named company connected with the Claimants (The Notting Hill Bag Company Limited - NHBCL) applied to renew the trade mark. Once the Dissolved Company was restored, it purported to assign the trade mark to NHBCL.

As the trade mark was not assigned out of the Dissolved Company before it was dissolved, that trade mark vested in the Crown under the bona vacantia principle. It is possible to unwind the clock and restore a company, so that it is treated as having continued in existence, and the company can re-acquire any assets it lost to the Crown. 

However, at the time the trade mark was renewed, the individual who completed the form could not have had the authority to do so, as the mark was owned by the Crown, and the Bona Vacantia Department did not, and does not, renew or authorise the renewal of trade marks. As such, the renewal was void, and the trade mark expired in May 2023. The proprietor, restored as of September 2023, could have applied to renew the trade mark within the grace period, but it did not do so. The mark had expired and could not have been transferred to NHBCL. 

Goodwill

NHBCL argued that it had received an assignment of goodwill in the brand from the company that had continued trading while the Dissolved Company had been dissolved (Organic Hill). NHBCL eventually accepted that there was no such assignment, which would have been an impermissible 'assignment in gross' (i.e. an assignment of goodwill without the underlying business changing hands). While Organic Hill might have generated its own goodwill, it was not a party to the proceedings.  

The judge found that the goodwill existing at the time of the dissolution was destroyed at that moment. This harsh, and perhaps counterintuitive, conclusion has support in the leading textbook (Wadlow) as approved in various judgments, e.g. Ultraframe (UK) Ltd v Fielding [2005] EWHC 1638 (Ch) and W3 Ltd v Easygroup Ltd [2018] EWHC 7 (Ch). 

NHBCL argued that it also owned its own goodwill by virtue to its own trade, but that claim failed on the evidence. 

Copyright infringement

The judge accepted that some creativity had gone into the creation of the logo (i.e. the mark above), but only very little. It boiled down to the use of four elements: the lower-case t, the full stop, the left justification and the font. The judge found this led to a low scope of protection (as per Lidl v Tesco [2024] EWCA Civ 262). 

The judge found that three out of four of those elements were not present in the Defendants' sign, although the Defendants' sign has a full stop and is left-justified to this Kat's eye. 

The judge noted that "the words themselves are to be ignored when considering the artistic copyright subsisting in the Logo". While the judge stated the law correctly (i.e. Infopaq etc.), and ultimately found copyright to subsist, this statement seems questionable. The choice of words is surely a key part of the creation of most logos, and the judge took into account the use of CAMDEN in a further logo used by the Defendants. The words were not the most inventive, but they are a part of the overall work.

Conclusion

Here are some points to tuck away in your organic tote:

1. Be careful with corporate restructuring. Most larger corporates will be aware of the issues with ensuring that all assets are transferred prior to dissolution, but mistakes are easy to make. 
2. If rights have gone to the Crown following dissolution, think carefully about how best to unwind it. Restoration is one option, but there are many trip-hazards. Another is buying the mark from the Crown (or BVD), but that process can lead to auctions.
   
3. Try to confine issues - a medley of good, reasonable and bad points undermines the best ones.

I have a lot of sympathy for the judge in this case. She was hearing a case which was, frankly, too complicated for a 2-day trial. Her judgment runs to 343 (albeit concise) paragraphs, or 53 pages. The complexity of some of the issues must have taken up a huge amount of her time, and the amount of assistance the parties could provide at trial must have been limited. 

Such complexity is not uncommon in IPEC cases, but it seems to this Kat that the issues could have been confined earlier than they were. 

The challenge is that parties are usually unable to add claims in the IPEC after the CMC, and costs consequences of running bad points are limited. Parties usually therefore put in everything at the start with a view to settlement and/or possibly dropping elements as the case goes on. However, it is then tempting to keep them in to see how it shakes out at trial, and the court rarely prompts a confining of issues pre-trial. The effect of this is a multitude of issues continuing. 

We have the benefit of hindsight, but this case seems to have been calling out for a 'give me your best arguments' approach. As this Kat has said before (here), bad points can make good ones less appetising.