When is a threat not a threat? This was the question before the court in Best Buy Co Inc and another v Worldwide Sales Corporation Espana SL [2010] EWHC 1666 (Ch), in a case decided by Mr Justice Floyd in the Chancery Division (England Wales) last Thur…

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The IPKat commends the Court of Appeal for England and Wales for the robust terms in which it condemns the foolish, inept and anticompetitive ruling of the Court of Justice of the European Union in Case C-487/07 L’Oréal v Bellure (discussed on this weblog here, here, here, here and here). He can do no better than to bring to the attention of his readers the words delivered by Lord Justice Jacob this morning:

“3. I set the facts out in detail in the earlier judgment; there is no need to do it all again. In summary the defendants have three ranges of products called Stitch, Création Lamis and Dorrall. Each member of the range smells like a famous, luxury branded perfume known by a well-known registered trade mark. L’Oréal alleges that the defendants’ use of comparison lists for each of the defendants’ ranges of product, showing which products correspond to which L’Oréal perfume, infringed its registered trade marks for those perfumes. Originally it also contended that some of the packaging used for the Création Lamis and Dorrall ranges also infringed other registered trade marks. No complaint was made about the packaging of the Stitch range.

4. So far as the packaging was concerned, by the time we sent questions to the ECJ only two items remained in dispute. They were called “historic” because the defendants had abandoned use of them in the UK before trial. The Judge held and we affirmed that the defendants’ current packaging gave no cause for legitimate complaint. Following the ruling of the ECJ, the defendants now accept that the two “historic” packages infringed. …

5. Thus we are left only with the comparison lists. As to the impact of these in the market I set the factual findings out in the earlier judgment:

‘[55] So the factual position can be summarised thus:
(i) It is lawful to make and sell a smell-alike product.
(ii) The best and only practical way to describe its smell is to inform people that it smells like X.
(iii) That is done by the use of the comparison lists.
(iv) The Defendants get a major promotional advantage from using such lists.
(v) Neither customers nor ultimate consumers are deceived as a result of the use of the lists.
(vi) Neither the image nor the distinctiveness of the trade mark for the comparable fine fragrance is impaired by the use of the lists – there is no tarnishment or blurring.
(vii) Sales of the corresponding fine fragrance are not affected by the use of the lists’.

And:

‘[63] I would add that a touch of reality is called for here. Consumers are not stupid. They will not see the cheap copy as being the same in quality as the original. They will see it for what it is and no more.

6. The problem, stated at its most general, is simple. Does trade mark law prevent the defendants from telling the truth? Even though their perfumes are lawful and do smell like the corresponding famous brands, does trade mark law nonetheless muzzle the defendants so that they cannot say so?

7. I have come to the conclusion that the ECJ’s ruling is that the defendants are indeed muzzled. My duty as a national judge is to follow EU law as interpreted by the ECJ. I think, with regret, that the answers we have received from the ECJ require us so to hold. Before I consider why in detail – and both because EU trade mark law is currently being reviewed by the Max Planck Institute at the request of the Commission and the Commission itself considers that the Court should reconsider its opinion in the instant very case (see [18] of Interflora v Marks & Spencers No. 2, [2010] EWHC 925 (Ch) [noted by the IPKat here] per Arnold J – I wish to say why I regret those answers.

8. My own strong predilection, free from the opinion of the ECJ, would be to hold that trade mark law did not prevent traders from making honest statements about their products where those products are themselves lawful.

9. I have a number of reasons for that predilection. First and most generally is that I am in favour of free speech – and most particularly where someone wishes to tell the truth. There is no good reason to dilute the predilection in cases where the speaker’s motive for telling the truth is his own commercial gain. Truth in the market place matters – even if it does not attract quite the strong emotions as the right of a journalist or politician to speak the truth.

10. The right to tell – and to hear – the truth has high international recognition. Art. 19 of the Universal Declaration of Human Rights says “Everyone has the right to freedom of opinion and expression; this right includes freedom to … receive and impart information ….” Art. 19(2) of the International Covenant on Civil and Political Rights says: “Everyone shall have the right to freedom of expression; this right shall include freedom to … receive and impart information …” Art 10(1) of the European Convention on Human Rights says: “Everyone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information …”. Art. 11(1) of the Charter of the Fundamental Rights of the European Union says: “Everyone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas …”

11. Of course the right of free expression (which clearly applies in principle to expression for commercial purposes … But any suggested rule of law which stands in the way of people telling the truth, whether the context be political, commercial or otherwise, ought to be scrutinised with care and justified only on the grounds of strict necessity.

12. Any such scrutiny should consider not only the right of the speaker but also of his hearer. For the right of free speech extends not only to those who wish to tell the truth, but also those who would wish to hear it – the words are “receive and impart.” In terms of the market place the hearer’s right to receive information translates into the right of the consumer to make an informed choice about products on the market.

13. That the right to free speech may trump trade mark rights was recognised by the Constitutional Court of South Africa in Laugh It Off Promotions v South African Breweries etc., 27th May 2005, Case CCT 42/04 [on which see IPKat here]. …

14. The ECJ’s decision in this case means that poor consumers are the losers. Only the poor would dream of buying the defendants’ products. The real thing is beyond their wildest dreams. Yet they are denied their right to receive information which would give them a little bit of pleasure; the ability to buy a product for a euro or so which they know smells like a famous perfume.

15. Moreover there is no harm to the trade mark owner – other than possibly a “harm” which, to be fair, L’Oréal has never asserted. That “harm” would be letting the truth out – that it is possible to produce cheap perfumes which smell somewhat like a famous original. I can understand that a purveyor of a product sold at a very high price as an exclusive luxury item would not like the public to know that it can be imitated, albeit not to the same quality, cheaply – there is a bit of a message that the price of the real thing may be excessive and that the “luxury image” may be a bit of a delusion. But an uncomfortable (from the point of view of the trade mark owner) truth is still the truth: it surely needs a strong reason to suppress it.

16. My second reason is more specific. It is about freedom to trade – indeed, potentially in other cases, to compete honestly. …. If a trader cannot (when it is truly the case) say: “my goods are the same as Brand X (a famous registered mark) but half the price”, I think there is a real danger that important areas of trade will not be open to proper competition.

17. … I regret that the ECJ in this case has not addressed the competition aspects of what it calls “riding on the coattails”. The trouble with deprecatory metaphorical expressions such as this (“free-riding” is another), containing as they do clear disapproval of the defendants’ trade as such, is that they do not provide clear rules by which a trader can know clearly what he can and cannot do”.

The Good Lord has spoken. Now it’s up to the Commission to undo the damage inflicted by the Court of Justice.

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An article in The Guardian today, “Absolute Radio settles trademark fight with Absolut vodka”, reports on the end of what might have been a long and entertaining court dispute between Absolute Radio and Swedish vodka brand Absolut. The vodka maker sued the UK music station for trade mark infringement and passing off but today’s settlement, the terms of which are confidential, has scotched the chance of further proceedings.

Absolut, the jewel in the crown of V&S Vin&Sprit, was not best pleased when the Times of India Group purchased Virgin Radio and renamed it Absolute, being concerned that there would be a risk of confusion between the two. A spokesman for V&S has now expressed pleasure at the outcome of this dispute, “which will enable us to continue to develop the iconic Absolut brand without risk of confusion to the public.” Absolute Radio is equally pleased, for obvious reasons.

While the terms of settlement are confidential, says the IPKat, it shouldn’t be long before the public gets some idea of what they contain: all they have to do is watch carefully and see how the two brands market their respective goods and services nonconfusingly. Merpel adds, I wonder whether there’s more to this matter than the report suggests: likelihood of confusion is something I associate with similar goods and services: it’s not obvious to everyone, though, that radio stations and vodka can be termed “similar”.

Make your own radio station here
Make your own vodka here

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The BBC has reported today that leading global brand owner Unilever is threatening legal action against the British National Party in order to prevent it from using a jar of the popular Marmite spread in a party political broadcast. According to the BBC article,

“Unilever said it had not given the BNP permission to use its product and was looking into taking out an injunction. The BNP’s online broadcast was removed from its website, but it can still be seen on video hosting website YouTube. The party initially said the clip was a spoof, but then claimed it had not been responsible for adding the Marmite jar.

In the broadcast, a jar of Marmite appears in the top left hand corner of the screen as BNP leader Nick Griffin addresses the camera. In a statement, BNP leader Nick Griffin said the jar had “apparently” been inserted by “one of the people to whom we had given the broadcast to review”. He added that it was not included in the official version of the broadcast.

Neither Marmite nor any other Unilever brand are aligned to any political party.
However, Mr Griffin went on to say that the Marmite jar had been added in reaction to a recent advertising campaign for Marmite which he said mocked the BNP. In the Marmite campaign two spoof political parties, the Love Party and the Hate Party, compete in a mock election. The BNP claims the Hate Party was “clearly based” on itself. “Quite simply, if you start a spoof, you should expect to get spoofed,” added Mr Griffin. “Although we are not responsible for whoever it was who inserted the Marmite jars into the internet version of the broadcast, we do see the amusing side.”

Unilever said in a statement: “Neither Marmite nor any other Unilever brand are aligned to any political party. We are currently initiating injunction proceedings against the BNP to remove the Marmite jar from the online broadcast and prevent them from using it in future.”

The IPKat speculates that Unilever’s claim will be based on trade mark infringement though either deriving an unfair advantage or damaging the reputation of the brand without due cause, as well as for passing off on the basis that the positioning of the Marmite jar constitutes a false representation that Marmite or its brand owner has endorsed or sponsored the BNP.

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Hot off the press, the IPKat brings you news of this morning’s ruling in Joined Cases C-236, 237 and 238/08 Google France, Google Inc. v Louis Vuitton Malletier; Google France v Viaticum Luteciel; Google France v CNRRH Pierre‑Alexis Thonet Bruno Raboin Tiger, a franchisee of Unicis. The factual backgrounds of the three cases, all of which have been referred from the French Cour de Cassation, are as follows:

Case C‑236/08 Google France, Google Inc. v Louis Vuitton Malletier

It was established at trial that (i) entering Louis Vuitton’s trade marks into Google’s search engine triggered the display of advertisements for sites offering counterfeit versions of that company’s products and that (ii) Google offered advertisers the possibility of selecting, to that end, not only keywords which corresponded to Louis Vuitton’s trade marks but also those keywords in combination with expressions denoting counterfeit such as ‘imitation’, ‘replica’ and ‘copy’. These facts led to Google being held liable trade mark infringement, a decision which was upheld on appeal. Google thereupon appealed on points of law to the Cour de cassation. That court referred for a preliminary ruling the following three questions:

‘(1) Must Article 5(1)(a) and (b) of [Directive 89/104] and Article 9(1)(a) and (b) of [Regulation No 40/94] be interpreted as meaning that a provider of a paid referencing service [ie Google] who makes available to advertisers keywords reproducing or imitating registered trade marks and arranges by the referencing agreement to create and favourably display, on the basis of those keywords, advertising links to sites offering infringing goods is using those trade marks in a manner which their proprietor [in this case Louis Vuitton] is entitled to prevent?

(2) In the event that the trade marks have a reputation, may the proprietor oppose such use under Article 5(2) of the directive and Article 9(1)(c) of the regulation?

(3) In the event that such use does not constitute a use which may be prevented by the trade mark proprietor under the directive or the regulation, may the provider of the paid referencing service be regarded as providing an information society service consisting in the storage of information provided by the recipient of the service, within the meaning of Article 14 of [Directive 2000/31], so that that provider cannot incur liability until it has been notified by the trade mark proprietor of the unlawful use of the sign by the advertiser?’

Case C‑237/08 Google France v Viaticum Luteciel

Viaticum and Luteciel own French trade marks ‘bourse des vols’, ‘bourse des voyages’ and ‘BDV’. It was found at trial that, (i) by that entering Viaticum and Luteciel’s trade marks into Google’s search engine, the display of advertisements for sites offering identical or similar products was triggered and that (ii) Google offered advertisers the possibility of selecting for that purpose keywords which corresponded to those trade marks. However, the products sold on the advertised sites did not infringe those trade marks in question since they bore trade marks attributed to competitors of Viaticum and Luteciel. Google was held liable for trade mark infringement and, on appeal, of being an accessory to trade mark infringement. Google thereupon appealed to the Cour de cassation, which has referred two questions to the Court for a preliminary ruling.

‘(1) Must Article 5(1)(a) and (b) of [Directive 89/104] be interpreted as meaning that a provider of a paid referencing service who makes available to advertisers keywords reproducing or imitating registered trade marks and arranges by the referencing agreement to create and favourably display, on the basis of those keywords, advertising links to sites offering goods identical or similar to those covered by the trade mark registration is using those trade marks in a manner which their proprietor is entitled to prevent?

(2) In the event that such use does not constitute a use which may be prevented by the trade mark proprietor under the directive or [Regulation No 40/94], may the provider of the paid referencing service be regarded as providing an information society service consisting in the storage of information provided by the recipient of the service, within the meaning of Article 14 of [Directive 2000/31], so that that provider cannot incur liability before it has been informed by the trade mark proprietor of the unlawful use of the sign by the advertiser?’

Case C‑238/08 Google France v CNRRH Pierre‑Alexis Thonet Bruno Raboin Tiger, a franchisee of Unicis

CNRRH is the holder of a licence for the French trade mark ‘Eurochallenges’, granted by Mr Thonet, the proprietor of that trade mark. At trial it was established (i) that entering ‘Eurochallenges’ into Google’s search engine triggered the display of advertisements for sites offering identical or similar products and (ii) that Google offered advertisers the possibility of selecting such a term as a keyword for that purpose. As in the second reference, the products offered on those sites did not infringe that trade mark and have been attributed to competitors. At trial. Google, Raboin and Tiger were held liable trade mark infringement, a decision which was upheld on appeal. Google and Tiger then filed separate appeals before the Cour de cassation, which referred three questions to the Court for a preliminary ruling.

‘(1) Does the reservation by an economic operator, by means of an agreement on paid internet referencing, of a keyword triggering, in the case of a request using that word, the display of a link proposing connection to a site operated by that operator in order to offer for sale goods or services, and reproducing or imitating a trade mark registered by a third party in order to designate identical or similar goods, without the authorisation of the proprietor of that trade mark, constitute in itself an infringement of the exclusive right guaranteed to the latter by Article 5 of [Directive 89/104]?

(2) Must Article 5(1)(a) and (b) of [Directive 89/104] be interpreted as meaning that a provider of a paid referencing service who makes available to advertisers keywords reproducing or imitating registered trade marks and arranges by the referencing agreement to create and favourably display, on the basis of those keywords, advertising links to sites offering goods identical or similar to those covered by the trade mark registration is using those trade marks in a manner which their proprietor is entitled to prevent?

(3) In the event that such use does not constitute a use which may be prevented by the trade mark proprietor under the directive or [Regulation No 40/94], may the provider of the paid referencing service be regarded as providing an information society service consisting in the storage of information provided by the recipient of the service, within the meaning of Article 14 of [Directive 2000/31], so that that provider cannot incur liability before it has been informed by the trade mark proprietor of the unlawful use of the sign by the advertiser?’

The Advocate General advised the Court to rule as follows:

(1) The selection by an economic operator, by means of an agreement on paid internet referencing, of a keyword which will trigger, in the event of a request using that word, the display of a link proposing connection to a site operated by that economic operator for the purposes of offering for sale goods or services, and which reproduces or imitates a trade mark registered by a third party and covering identical or similar goods, without the authorisation of the proprietor of that trade mark, does not constitute in itself an infringement of the exclusive right guaranteed to the latter under Article 5 of First Council Directive 89/104 … to approximate the laws of the Member States relating to trade marks.

(2) Article 5(1)(a) and (b) of Directive 89/104 and Article 9(1)(a) and (b) of Council Regulation (EC) No 40/94 … on the Community trade mark must be interpreted as meaning that a trade mark proprietor may not prevent the provider of a paid referencing service from making available to advertisers keywords which reproduce or imitate registered trade marks or from arranging under the referencing agreement for advertising links to sites to be created and favourably displayed, on the basis of those keywords.

(3) In the event that the trade marks have a reputation, the trade mark proprietor may not oppose such use under Article 5(2) of Directive 89/104 and Article 9(1)(c) of Regulation No 40/94.

(4) The provider of the paid referencing service cannot be regarded as providing an information society service consisting in the storage of information provided by the recipient of the service within the meaning of Article 14 of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market (‘Directive on electronic commerce’).

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