England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CHANCERY DIVISION
Mr DAVID YOUNG QC (SITTING AS A DEPUTY
JUDGE OF THE CHANCERY DIVISION)

		Royal Courts of Justice Strand, London, WC2A 2LL
		17th December 2002

Lord Justice Aldous:

1. The claimants, Thomson Holidays Limited, (Thomson), appeal the judgment and order of Mr David Young QC of 5th March 2002 who sat as a deputy judge of the Chancery Division.
2. Thomson are the registered proprietor of two trade marks consisting of the word "FREESTYLE" which were registered as of 1st October 1986. They were:

Trade Mark Number Services

1,288,949 (the 949 mark)	Arrangement and booking of travel, tours and cruises; escorting travellers and arranging the escorting of travellers; providing tourist office services; all including in Class 39.
1,288,951 (the 951 mark)	Booking and provision of accommodation, catering services for travellers; providing of day nurseries (other than schools); leasing and rental of computers; all included in Class 42.

3. Thomson alleged that the defendant, Norwegian Cruise Line Limited, (Norwegian) had infringed those trade marks by promoting its cruises under and by reference to the mark FREESTYLE.
4. Norwegian denied infringement; it alleged that the trade marks in so far as they covered certain services including cruises were invalid for five years' non-use.
5. The judge held that the trade marks were invalid as they stood and that to avoid revocation amendments to their specifications were necessary so that they read as follows:

"1,288,949: Arrangement and booking of travel and tours

and cruises; escorting travellers and arranging the escorting of travellers; providing tourist office services; all included in Class 39 and all excluding services in relation to cruises on a cruise ship.

1,288,951: Booking and provision of accommodation,

catering services for travellers; provision of day nurseries (other than schools); leasing and rental of computers; all included in Class 42 and all excluding services in relation to cruises on a cruise ship."

6. The judge went on to consider whether the trade marks with amended specifications had been infringed. He concluded that they had not been and therefore dismissed the action. On appeal Thomson challenge the judge's conclusions as to validity and infringement.
7. Validity – It is convenient to consider validity first as infringement may depend upon the services for which the trade marks are registered.
8. In their defence and counterclaim Norwegian alleged that the trade marks were invalid and should be revoked for non-use to the extent that:

"(a) in the case of trade mark number 1288949, it covers cruises; and

(b) in the case of trade mark number 12888951, it covers cruises, day nurseries (other than schools) and the leasing and rental of computers."

9. Thomson accepted that the specification of 951 should be amended for non-use by deletion of "day nurseries (other than schools) and the leasing and rental of computers." Further in their reply they admitted that they had not promoted or offered cruises under the mark FREESTYLE for 5 years ending March 2000.
10. Revocation for non-use is provided for in section 46 of the Trade Marks Act 1994 which is as follows:

"s 46 Revocation of registration.(1) The registration of a trade mark may be revoked on any of the following grounds--(a) that within the period of five years following the date of completion of the registration procedure it has not been put to genuine use in the United Kingdom, by the proprietor or with his consent, in relation to the goods or services for which it is registered, and there are no proper reasons for non- use;(b) that such use has been suspended for an uninterrupted period of five years, and there are no proper reasons for non-use;...(5) Where grounds for revocation exist in respect of only some of the goods or services for which the trade mark is registered, revocation shall relate to those goods or services only.(6) Where the registration of a trade mark is revoked to any extent, the rights of the proprietor shall be deemed to have ceased to that extent as from--(a) the date of the application for revocation, or(b) if the registrar or court is satisfied that the grounds for revocation existed at an earlier date, that date."

11. It was not disputed that Thomson had used FREESTYLE as a trade mark for package holidays since 1985. The judge's findings of fact as to how the trade mark had been used were contained in paragraphs 3 and 5 of his judgment.

"3. The Claimants first used their FREESTYLE mark as a brand for summer package holidays for the youth market in 1985. Youth market refers to those particularly between the ages of 18 and 30 years and indeed FREESTYLE holidays' main competitor has been Club 18-30.

Sales of holidays in the years 1985 to 1988 were relatively modest in terms of numbers and as a result use of the FREESTYLE brand for such holidays was effectively discontinued until 1993 when it was reintroduced under the style CLUB FREESTYLE at first as part of Sky Tours Holidays programme but latterly (as of 1998) on its own having its own brochure and featuring package holidays to fourteen or so resorts. Use of the word CLUB (generally in smaller print and not always juxtaposed to FREESTYLE) is to denote that the holiday is for a group of like-minded people as well as providing a "clubbers" image. There is no upper age limit but there is an age limit of 17 (with parental consent and if accompanied by some one of 18 or over).

A feature of such "Club Freestyle" holidays is that the hotel accommodation provided is generally exclusive to Club Freestyle holidaymakers. Representatives (reps) are at hand to assist in providing entertainment such as excursions including jeep safaris, day boat trips (referred to as "booze cruises" or Boat BBQ and "chill out cruises"), Freestyle Frenzy (bar crawls) etc.

In addition to such summer package holidays, since 1998 the Claimants have also sold winter Club Freestyle ski holidays marketed by Thomson Ski and Snowboarding which is a division of the Claimants. Details of such ski-holidays are incorporated in the Claimants' Ski Board Snow brochure.

…

5. Included in the holiday package are a number of items listed in the Claimants' Club Freestyle brochure including the return flights (e.g. on the Claimants in-house airline Britannia); coach transfers to and from the resort airport; accommodation at the chosen hotel or apartment; meals and the services of a Club Freestyle rep."

12. In paragraph 3 of his judgment the judge referred to excursions that had been organised. As examples Mr Baldwin QC, who appeared with Mr Abrahams for Thomson, took us to the 1st edition of the 2001 CLUB FREESTYLE brochure. On its front page there appears at the top left the word "CLUB" which is 3.5 cm long and 1.5 cm high. Down the left hand side appears the word "FREESTYLE" about 28.5 cm in length and 4 cm high. The brochure contains about 100 pages promoting and explaining 14 Freestyle holidays. On page 5 there appears an explanation of what will be provided which includes the statement that "There is loads organised in your resort – beach parties with free bars and food, cruises drenched in sun and sangria and wet 'n' wild parties in the park."
13. The advertised holiday to Majorca provides transport, holiday accommodation with beach bars, and day trips. One of such trips includes "A chilled out 3 hour boat tour in a brand new 100 ft catamaran. Drinks are included, but its no booze cruise". The holiday to Gran Canaria is similar with a "club cruise" available to "Cruise the waves while a top DJ plays!" The holiday to Corfu has available a "Cruise to Paxos – Take it easy and enjoy the sun, the sea and the sand on this chilled out cruise." Similar cruises are available with some of the holidays at other resorts.
14. The brochure shows, as the judge found, that Thomson have used "FREESTYLE" as a trade mark to denote origin in respect of summer holidays. Further, as the judge found, FREESTYLE has been used by Thomson in relation to winter ski packaged holidays.
15. The judge held that Norwegian had also used FREESTYLE as a sign. He said:

"7. In May 2000 the Defendants first launched "Freestyle Cruising" on their cruiser the Norwegian Sky since when the Freestyle Cruising concept has been adopted by the whole fleet with the exception of S/S Norway. In their 2001/2002 brochure Freestyle Cruising is depicted on the front and back covers in wave logo form as part of the title "NCL Norwegian Cruise Line, Freestyle Cruising". In addition the word FREESTYLE is depicted on the front cover in freehand with the words World-wide Cruising in large capitals underneath and on the back cover Freestyle is coupled with various on board activities, namely Dining, Service, Attire, Activities, Gratuities, Disembarkation – all part of the world of Freestyle Cruising. (see Exhibit X1). As an integral part of a number of the Freestyle Cruising holiday cruises (e.g. Cruise and Stay; Cruise and Tour) the Defendants arrange tours or excursions which may or may not involve arranging hotel accommodation as part of the tour (see e.g. Exhibit X2).

…

19. I have no doubt that the Defendants' use of the word "Freestyle" whether used on its own or when combined as "Freestyle Cruising" or indeed as "NCL Freestyle Cruising" is a use of the sign "Freestyle" which of course is identical to the registered FREESTYLE marks.

…"

16. Norwegian's 2001-2002 brochure is a substantial document of about 100 pages. On the front page cruises are advertised for places such as Alaska and South America. "FREESTYLE" appears in stylised writing above the large letters "WORLDWIDE CRUISING". Throughout the brochure "FREESTYLE" is used in such phrases as "Introducing Freestyle Cruising", "Freestyle Cruising", "Freestyle Dining", "Freestyle Attire", "Freestyle Activities", "Freestyle Service" and "Freestyle Disembarkation".
17. The Hawaii stay and cruise offers a 7 night pre-cruise package in Honolulu followed by a cruise on a Norwegian ship. The brochure explains that you can choose "one of the wonderful hotel packages or tours you'll find either on the following pages or on the page describing the cruise itself. Then decide how many nights you want to stay – we quote a per night rate – and then let us make all the arrangements for you". Typically the trip includes flights, accommodation at a hotel, the cruise on board a Norwegian ship, further accommodation at a hotel and the flight home. Transfers between airport and hotel and point of embarkation are also included as is free car parking.
18. The word "cruise" was used differently during this appeal by the parties. So far as Norwegian is concerned, a cruise is a type of holiday where nights are spent on board a luxury cruise ship. For the relevant 5 years such holidays have not been organised by Thomson. However they contend that they have used FREESTYLE in relation to cruises, albeit they only last one day and are of the type described in their 2001 brochure.
19. Where a question arises as to the use made of a registered trade mark, section 100 of the 1994 Act requires the proprietor to show what use has been made of it. It follows that it is necessary first to decide what are the services in relation to which Thomson have shown use of FREESTYLE. Mr Baldwin submitted that they had used it for all the elements of their holidays which included arranging and booking of travel, tours and cruises, escorting travellers and arranging the escorting of travellers as contained in the specification of the 949 mark. Similarly they had used the mark to book and provide accommodation and catering services for travellers which were the relevant services of the 951 mark. To support that submission he reminded us of what was needed to arrange holidays and referred to places in the Thomson brochure where representatives were referred to as "freestyle reps" and where FREESTYLE was used in respect of activities.
20. Mr Baldwin is right that the advertised FREESTYLE holidays did involve Thomson in carrying out all the activities in the specifications, but that does not mean that the marks have been used in relation to those services.
21. Mr Bloch QC, who appeared with Mr Hornby for Norwegian, submitted that Thomson had not used FREESTYLE in relation to services such as booking travel and accommodation, arranging day cruises and escorting travellers and so forth as they did not provide such services separately. FREESTYLE had only been used in relation to package holidays which included the activities referred to.
22. Section 46 requires the Court to consider whether there has been use in relation to goods or services. It is therefore appropriate to ask the question in those terms, namely in relation to what services have Thomson used FREESTYLE? I believe the answer must be what can be generally described as arranging and providing holidays. They do not offer the services mentioned in the specifications individually. Trade mark 949 covers some of the activities which are involved in arranging and providing package holidays. However it also covers those activities when provided alone. For example the service of meeting children at airports and escorting them to their destination is within the specification. No such use has been made by Thomson. Similar comments apply to trade mark 951. It follows that the specifications cover services which have not been supplied by Thomson for at least 5 years. The specifications need to be amended by addition at least of such words as "for holidays".
23. Such an amendment does not necessarily provide the answer to the appeal as Norwegian submitted and the judge found that cruises were a subset of holidays. Thus Norwegian submitted and the judge found that it was necessary to "dig deeper" into the word "holidays" and extract the subset. Whether section 46(5) requires the court to do that has led to a division of judicial opinion. In Premier Brands UK Ltd v Typhoon Europe Ltd [2000] FSR 767 Neuberger J had to decide an action for infringement brought by Premier Brands who were importers, blenders and suppliers of tea. Their trade mark TYPHOO for tea was very well-known. It was registered in class 30 for tea and also as defensive registrations in other classes for other goods.
24. Premier Brands contended that Typhoon Europe's use of the trade mark TYPHOON in respect of kitchen hardware infringed their registered trade mark. Infringement was denied and it was alleged that there had been non-use of TYPHOO in relation to kitchen hardware and therefore section 46(5) should be applied to exclude such goods. The judge said:

"Although I have found that the use by, or permitted by, of Premier of the TYPHOO mark in relation to the Goods constitutes trade mark use, that is not the end of the matter in relation to the defensive marks. It will be recalled that the Goods are tea caddies, tea pots, mugs, tea towels, milk jugs, sugar bowls, biscuit barrels, cups, mug trees, aprons, storage jars, memo boards, tea cosies, trivets, tea pot stands, trays, cafetieres and drinking glasses. It will also be recalled that the '270 Mark is registered in respect of "hand tools and hand implements, all for domestic use; and cutlery, forks and spoons", and that the '276 Mark is registered in respect of "domestic utensils and containers ..., combs, brushes ... sponges and instruments ... and materials for cleaning; and glassware, porcelain and earthenware ...".

Mr Arnold raised the question as to how section 46(5) is to be applied once one concludes, as I have done in relation to the '276 Mark, that it has been used in respect of some of the items for which it is registered, but not in respect of others. It appears to me that one simply looks at the list of items on the register and asks oneself, in relation to each such item, whether or not the mark has been used "in relation to" or "in connection with" that item during the past five years. If the answer is in the affirmative, then the mark can remain registered in respect of that item; if the answer is in the negative then, subject to any question of discretion, the registration is revoked in respect of that item. One does not dig deeper and, as it were, narrow a particular category of item to reflect the extent of the goods to which the mark has been used. Thus, if the only "domestic ... container" in connection with which the mark had been used was a red tea caddy, it seems to me that the registration should remain in respect of domestic containers: it should not be cut down to, for instance, containers for food, containers for tea, tea caddies, or red tea caddies. First, as a matter of principle, it appears to me that one should take the registration as one finds it. Secondly, as a matter of practice, if the law were otherwise it would lead to uncertainty (as indicated by the example I have just given) and a potential welter of applications for partial revocation. I note that the approach which I favour appears to have been adopted in the Trade Marks Registry in Zippo Trade Mark [1999] R.P.C. 173."

25. Mr Baldwin supported the approach of Neuberger J. He submitted that the statutory test of section 46(1)(a) and (b) required the court to compare the use that had been made by the proprietor with the specification. If there was use within the services in the specification, however broadly described, the trade mark would not be revoked partially or at all. It was only if the specification set out particular goods or services in respect of which the trade marks had not been used would revocation be necessary. In that case section 46(5) applied.
26. The view expressed by Neuberger J in the Premier Brands case was not followed by Jacob J in MINVERVA Trade Mark [2000] FSR 734. In that case the proprietor of the trade mark had used it on printed stationery forms, but had registered it for 'paper and paper articles, cardboard and cardboard articles; printed matter; stationery material; artists' materials/other than colours or varnish; drawing materials; office requisites other than furniture; ordinary placing cards; all included in class 16.' The trade mark was alleged to be invalid as there had been no use of it for 5 years in respect of books. Jacob J upheld that submission. At page 737 he set out the passage from the judgment of Neuberger J in the Premier Brands case and then said at page 738:

"Neuberger J.'s attention was not drawn to the decision of Laddie J. in Mercury Communications Ltd v. Mercury Interactive (UK) Ltd [1995] F.S.R. 850. Laddie J. was concerned with a very wide specification of goods: "computer programs". In rejecting an application for summary judgment, he took the view that that wide specification could be cut down by a non use attack. In other words, that "computer programs" could be limited to computer programs of a particular part.

I have no doubt that what Laddie J. assumed was right and in this respect I differ from Neuberger J. The problem is that some of the language for specifications of goods is apt to be extremely wide. Indeed, "printed matter" in this case is extremely wide. I think it is inevitable that at times one would have to "dig deeper". Even taking the specification considered by Neuberger J for a "domestic container", one can think of quite different sorts of domestic container: a hat box, a snuff box, a jewellery box, a plastic thing you put inside the fridge. Wide words can cover what are commercially quite different sorts of articles. So if one were to show use for just one of that sort, it would be commercially nonsense to maintain the registration for all goods caused by the wide words.

That is not to say the court will cut the registration right down to things like red tea caddies. But if non use in respect of a significant subset of a wide general description is established, then I see no reason why the court should not eliminate that subset from the registration. Thus here I think that, although use in relation to printed stationery is established, stationery is a quite different sort of material from literary publications of the kind put out by Reed and the specification can be cut down."

27. The decision in Minerva Trade Mark was followed by Pumfrey J in Decon Laboratories Ltd v Fred Baker Scientific Ltd [2001] RPC 293. In that case the defendants were alleged to infringe Decon's trade mark DECON by the sale of products sold under the name DECON-ATTOH, DECON-PHENE, DECON-PHASE and DECON-CLEAN. They were disinfectant products for use in clean rooms. The trade mark was registered in respect of "Cleaning and decontaminating substances; disinfectants; sterilising substance and preparing; all included in class 5". The defendants alleged that that trade mark should be revoked in part for non-use. Their contention was that there was a distinct market for sterilised cleaning materials for use in clean rooms and the like (the products they sold) and that the registration ought to be limited so that it reflected the non-use of DECON on those goods.
28. Pumfrey J said after citing the passage I have quoted from the judgment of Neuberger J in the Premier Brands case:

"In the Minerva case, Jacob J. did not accept this view of the section. The difficulty with Neuberger J.'s formulation is that while apt to deal with the case before him, it did not deal in terms with huge classes of goods described by single phrases like "computer software" or "cleaning substances and preparations". I must therefore differ with respect from Neuberger J. and agree with what Jacob J. said in MINERVA Trade Mark. At times, it is inevitable that one is obliged to dig deeper.

22. The problem which is raised in an acute form in this case is how much deeper it is right to dig. It is not possible to draw a list of goods in respect of which the mark has not been used, and it seems to me that the question is the more general one: how should the specification of goods be narrowed to reflect the non-use? In answering this question, my starting point is that the action for infringement of a registered trade mark is an action in which (in its simplest form) the claimant is relieved from the obligation of showing the court how in fact he uses the mark. It can be viewed in purely domestic terms as an action for passing off in which it is not necessary to give evidence as to reputation. In my judgment, it would only be right as a matter of principle to divest the registered proprietor of a part of his statutory monopoly if one is satisfied that he ought to have to demonstrate confusion in fact, or at least be obliged to rely on section 10(2). The assessment need not of course be made without reference to the activities of the defendants. The fact of non-use has in itself nothing to do with the defendant, and the defendant's activities, or lack of them, are prima facie irrelevant unless, I suppose, it can be shown that the defendant has himself created a reputation in respect of a class of goods for which the claimant has not used the mark. It follows it seems to me that the second form of revocation sought by the defendants in the present case is not acceptable, leaving as it does a class of goods defined negatively by reference to the defendants' activities.

23. In my judgment, the task is best performed by asking what would be a fair specification of goods having regard to the use that the proprietor has in fact made of the mark and assuming further that he will continue that use. Mr Campbell submitted that the specification of goods should in effect be drafted from scratch to encompass only the use which the registered proprietor has made of the mark. I accept that the starting point should be a limitation to the actual field of use. The difficulty lies in deciding on the width of the surviving specification, the correct formulation of which must depend largely upon questions of fact and degree. Let me take an example to which Neuberger J. refers in Typhoon. There, the registration was (inter alia) for "domestic containers". Suppose the proprietor uses the mark only on red tea caddies. How does one limit the registration? Obviously the use of the colour red is irrelevant, since it does not define a species of goods. But should the registration be limited to tea caddies? Neuberger J. thought not, since, as he put it, one should take the registration as one finds it, and it is not possible to distinguish between containers for food, containers for tea, and tea caddies. He added that he considered that to permit this kind of detailed approach to a registration leads to uncertainty and invites litigation. So he considered that the registration should remain in respect of domestic containers. I would agree wholeheartedly with this statement of the problem, but the answer must, I believe, depend upon the facts of the case.

24. I think that the correct starting point as a matter of principle consists of the list of articles for which the proprietor has in fact used the mark. In arriving at a fair specification having regard to the proprietor's use, it is also necessary to remember that the effect of section 10(2) (and of 10(3), in limited circumstances) is to give the proprietor protection outside his specification of goods but in areas where he can demonstrate a likelihood of deception in the wide sense, that is, deception as to trade origin leading to association among the relevant public. There is no pressing need, therefore, to confer on the proprietor of a wider protection than his use warrants by unduly broadening the specification of goods. There is a balance to be held between the proprietor, other traders and the public having regard to the use which has in fact taken place.

25. Here, the proprietor's cleaners are cleaners for technical/industrial use and on the face of it the specification should be limited to reflect this fact. The main channels of trade are those which I have described. The persons who will encounter the goods in the course of trade or business are the purchasers and the users of such cleaning materials. They would not, it seems to me, be confused by the use of the mark "Decon" on washing up liquid or dish washer powder purchased in a supermarket. It should be remembered that many people other than chemical laboratories in the narrow sense will have access to Fred Baker's catalogue and other similar publications. This catalogue is no doubt essentially a catalogue for products for using in chemical laboratories but covers materials to be used for tissue culture, dissection, and there is even some clean room clothing. How is the class of goods to be fairly described? My immediate reaction was to say that all these cleaning materials are intended for use in a laboratory. That is where the mark started to be used; it is the area in which the mark has always been used; and it is the only relevant area of business in which the proprietor trades. My first view was that the specification should be limited by including words such as "all for laboratory use" but Mr Moody-Stewart satisfied me that this is too narrow and does not reflect the use actually made of the mark, which on the unchallenged evidence includes industrial use. He suggested, and I accept, that the area of use established on the evidence was non-domestic use. It is not possible sensibly to formulate a narrower specification, and it would not be fair to the proprietor to attempt to do so.

26. The defendants' first proposed specification of goods is open to the objection that the words "general purpose" are ambiguous and might be said to cover such products as detergents purchased in supermarkets for domestic use. It is the nature of the use which I consider to be crucial in the present case. Accordingly, I shall revoke the registrations in suit except to the extent to which they relate to the products set out in the present specifications of goods but qualified by the words "all for non-domestic use"."

The judge went on to hold that despite the partial revocation there was infringement.

29. I have no doubt that Pumfrey J was correct to reject the approach advocated in the Premier Brands case. His reasoning in paragraphs 22 and 24 of his judgment is correct. Because of section 10(2) fairness to the proprietor does not require a wide specification of goods or services nor the incentive to apply for a general description of goods and services. As Mr Bloch pointed out to continue to allow a wide specification can impinge unfairly upon the rights of the public. Take for instance a registration for "motor vehicles" only used by the proprietor for motor cars. The registration would provide a right against a user of the trade mark for motor bikes under section 10(1). That might be understandable having regard to the similarity of goods. However the vice of allowing such a wide specification becomes apparent when it is envisaged that the proprietor seeks to enforce his trade mark against use in relation to pedal cycles. His chances of success under section 10(2) would be considerably increased if the specification of goods included both motor cars and motor bicycles. That would be unfair when the only use was in relation to motor cars. In my view the court is required in the words of Jacob J to "dig deeper". But the crucial question is – how deep?
30. Pumfrey J was, I believe, correct that the starting point must be for the court to find as a fact what use has been made of the trade mark. The next task is to decide how the goods or services should be described. For example, if the trade mark has only been used in relation to a specific variety of apples, say Cox's Orange Pippins, should the registration be for fruit, apples, eating apples, or Cox's Orange Pippins?
31. Pumfrey J in Decon suggested that the court's task was to arrive at a fair specification of goods having regard to the use made. I agree, but the court still has the difficult task of deciding what is fair. In my view that task should be carried out so as to limit the specification so that it reflects the circumstances of the particular trade and the way that the public would perceive the use. The court, when deciding whether there is confusion under section 10(2), adopts the attitude of the average reasonably informed consumer of the products. If the test of infringement is to be applied by the court having adopted the attitude of such a person, then I believe it appropriate that the court should do the same when deciding what is the fair way to describe the use that a proprietor has made of his mark. Thus the court should inform itself of the nature of trade and then decide how the notional consumer would describe such use.
32. In the present case FREESTYLE has been used by Thomson in respect of holidays aimed at the younger customer, in particular in groups. Mr Baldwin suggests that the average reasonably informed consumer would describe such use as use in relation to holidays or perhaps package holidays. Mr Bloch submitted that they would be described as either land-based holidays or holidays excluding cruises on cruise ships or such holidays for holiday makers aged 18-30.
33. I can quickly exclude from further consideration the age limitation sought by Mr Bloch. Mr Baldwin objected to this submission as it was not pleaded and because permission to appeal had not been sought or given. I reject the pleading point as that was dealt with by the judge who gave Thomson an opportunity to seek an adjournment: that was not taken up. Further, even by the time of the appeal Thomson had no foundation for any alleged prejudice. As to the failure to obtain permission to appeal, I believe it is right to grant permission and dismiss the appeal for the reasons given by the judge in paragraph 15 of his judgment. In any case the services provided by Thomson were provided to the public generally.
34. The judge concluded that the specifications should be amended so as to exclude cruises on cruise liners. He said that it was not possible to distinguish between the manner in which holiday types are marketed from the end product itself. He then accepted the evidence of Professor Middleton who said consumers of tourism products are no longer dealt with on a mass consumption of "'one fits' all basis. …. Targeted groups of customers are known internationally in marketing as market segments, a technical term that is fully understood and practised by all marketing orientated organisations." Professor Middleton listed typical segments as "summer sun, winter sun, winter sports, activity holidays (e.g. golf, sailing and walking), city breaks, cruise-ship products, safaris and dedicated youth products."
35. The judge concluded:

"13. I consider that cruises in the sense of cruise ship holidays and the ancillary services directly involved with such cruises form a distinct category of holiday product which differs both in kind and customer profile to land based package holiday products such as the Claimants' Club Freestyle package holiday."

36. There was ample evidence upon which the judge could have come to the conclusion that he did in paragraph 13 of his judgment, but that could not form the basis for his conclusion that the specifications should be limited to exclude only cruises. If he had been right then all the other segments such as safaris, city breaks and activity holidays should also have been excluded. To do that would result in limitation to perhaps two segments of the holiday trade. That would not be how the notional consumer would perceive the services that Thomson had provided.
37. Professor Middleton's evidence was interesting, but was not directed to the correct question. It does not follow from the fact that tourism has distinct segments that the services offered by Thomson would not be referred to using a more general description. The fact that Cox's Orange Pippin apples are marketed in and directed at the eating apple market, does not mean that the average consumer would not refer to them as apples.
38. We were not directed to any evidence which would lead us to believe that there is a category of holiday referred to as "land-based". Further, such a categorisation of Thomson's use would not be apt as their holidays involved swimming in the sea and day cruises. I therefore reject the submission that the specification should be restricted to "land-based holidays".
39. How would the average consumer describe the services provided by Thomson under the FREESTYLE mark? I believe they would use the term "package holidays". That term is a fair description of the use made. I therefore would add to both specifications words to the effect that the services were all for package holidays. By doing so I would therefore revoke under section 46(5) the other services within the specification.
40. Infringement – A registered trade mark is a property right (section 2) which is personal property (section 22). It can be assigned either in connection with the goodwill of a business or independently (section 24). Once obtained a registration is prima facie valid (section 72). It need not be used for the initial 5 years after registration, but thereafter is liable to be revoked in whole or in part for non-use under section 46.
41. Section 9 of the Act provides that the proprietor of a registered trade mark has exclusive rights in the trade mark and that those rights are infringed by use of the trade mark in the United Kingdom without consent. Such rights are enforceable from the date of registration.
42. The acts amounting to infringement are specified in section 10 which reads as follows:

"s 10 Infringement of registered trade mark.(1) A person infringes a registered trade mark if he uses in the course of trade a sign which is identical with the trade mark in relation to goods or services which are identical with those for which it is registered.(2) A person infringes a registered trade mark if he uses in the course of trade a sign where because—

(a) the sign is identical with the trade mark and is used in relation to goods or services similar to those for which the trade mark is registered, or(b) the sign is similar to the trade mark and is used in relation to goods or services identical with or similar to those for which the trade mark is registered,there exists a likelihood of confusion on the part of the public, which includes the likelihood of association with the trade mark.

…

(4) For the purposes of this section a person uses a sign if, in particular, he—

(a) affixes it to goods or the packaging thereof;(b) offers or exposes goods for sale, puts them on the market or stocks them for those purposes under the sign, or offers or supplies services under the sign;(c) imports or exports goods under the sign; or(d) uses the sign on business papers or in advertising.

…"

43. It is important to note the difference between subsections (1) and (2) of section 10. Subsection (1) is absolute in the sense that there is infringement if there is both identity of marks and the infringing goods fall within the registered specification of goods. Subsection (2) is concerned with cases where identicality may not be present. In such cases the proprietor must establish " a likelihood of confusion on the part of the public, which includes the likelihood of association with the trade mark".
44. In the present case the judge rightly concluded in paragraph 19 of his judgment that Norwegian's "use of the word FREESTYLE, whether used on its own or when combined as 'FREESTYLE CRUISING or indeed NCL FREESTYLE CRUISING, is a use of the sign FREESTYLE which is of course identical to the registered FREESTYLE marks". It is also clear that Norwegian are using FREESTYLE in relation to package holidays, albeit involving a cruise on a cruise ship. It follows that their use is in relation to services which are identical to those for which I have concluded the marks should be registered. Thus section 10(1) applies and there is infringement.
45. The parties did not refer us to any guidance of the ECJ as to how section 46 should be applied. I therefore wondered whether this might be a case where it would be appropriate to seek guidance from the ECJ. However I have concluded that this is not the appropriate vehicle as in my view there would be infringement under section 10(2) even if Norwegian are right and the specifications should be amended to exclude cruises on cruise ships. I therefore give my reasons for that conclusion.
46. The Trade Marks Act 1994 was enacted to give effect to the First Council Directive 89/104 of December 21 1988. It follows that section 10 should be interpreted to have the same effect as the appropriate Articles of the Directive. Thus guidance as to the application of section 10 can be obtained for decisions of the European Court of Justice (ECJ).
47. In Canon Kabushiki Kaisha v Metro-Goldwyn-Mayer Inc (Case C-397) [1998] ECR 1-5507, [1999] RPC 117, the ECJ gave guidance as to what amounts to confusion. In that case a national court was considering an opposition to registration of the trade mark CANON in respect of "files recorded on video tape cassettes (video cassettes); production, distribution and projection of films for cinema and television institutions". The application was opposed by Canon Kabushiki Kaisha (CKK) on the ground that the trade mark sought to be registered infringed their trade mark "CANON" which was registered in respect of "still and motion pictures, cameras and projectors; television filming devices, television receiving and reproduction devices, including tape and disc devices for television recording and reproduction". The question asked was:

"May account be taken, when assessing the similarity of the goods or services covered by the two marks, of the distinctive character, in particular the reputation, of the mark with earlier priority (on the date which determines the seniority of the later mark), so that, in particular, likelihood of confusion within the meaning of Article 4(1)(b) of Directive 89/104/EEC must be taken to exist even if the public attributes the goods and/or services to different places of origin ("Herkunftsstatten")?"

48. The court interpreted that question in two parts. As to the first part it said:

"12. In the first part of the question, the Bundesgerichtshof asks in substance whether, on a proper construction of Article 4(1)(b) of the Directive, the distinctive character of the earlier trade mark, and in particular its reputation, must be taken into account when determining whether the similarity between the goods or services covered by the two trade marks is sufficient to give rise to the likelihood of confusion.

…

15. It is to be noted, first, that the tenth recital of the preamble to the Directive states that "the protection afforded by the registered trade mark, the function of which is in particular to guarantee the trade mark as an indication of origin, is absolute in the case of identity between the mark and the sign and goods or services; . . . the protection applies also in case of similarity between the mark and the sign and the goods or services; . . . it is indispensable to give an interpretation of the concept of similarity in relation to the likelihood of confusion; . . . the likelihood of confusion, the appreciation of which depends on numerous elements and, in particular, on the recognition of the trade mark on the market, [on] the association which can be made with the used or registered sign, [and on] the degree of similarity between the trade mark and the sign and between the goods or services identified, constitutes the specific condition for such protection"."

49. As the second part of the question the ECJ said:

"25. In the second part of the question the Bundesgerichtshof asks in substance whether there can be a likelihood of confusion within the meaning of Article 4(1)(b) of the Directive where the public perception is that the goods or services have different places of origin ("Herkunftsstatten").

26. There is a likelihood of confusion within the meaning of Article 4(1)(b) of the Directive where the public can be mistaken as to the origin of the goods or services in question.

27. Indeed, Article 2 of the Directive provides that a trade mark must be capable of distinguishing the goods or services of one undertaking from those of other undertakings, while the tenth recital in the preamble to the Directive states that the function of the protection conferred by the mark is primarily to guarantee the indication of origin.

28. Moreover, according to the settled case-law of the Court, the essential function of the trade mark is to guarantee the identity of the origin of the marked product to the consumer or end user by enabling him, without any possibility of confusion, to distinguish the product or service from others which have another origin. For the trade mark to be able to fulfil its essential role in the system of undistorted competition which the Treaty seeks to establish, it must offer a guarantee that all the goods or services bearing it have originated under the control of a single undertaking which is responsible for their quality (see, in particular, Case C-10/89 HAG GF (HAG II) [1990] ECR I-3711, paragraphs 14 and 13.

29. Accordingly, the risk that the public might believe that the goods or services in question come from the same undertaking or, as the case may be, from economically-linked undertakings, constitutes a likelihood of confusion within the meaning of Article 4(1)(b) of the Directive (see SABEL, paragraphs 16 to 18). Consequently, as the Advocate General states at point 30 of his Opinion, in order to demonstrate that there is no likelihood of confusion, it is not sufficient to show simply that there is no likelihood of the public being confused as to the place of production of the goods or services."

50. Guidance as to how confusion within Article 5 (section 10) should be assessed was given in the ECJ in Lloyd Schuhfabrik Meyer & Co GmbH v Klijsen Handel BV (Case C-342/97) [1999] ECR 1-3819, [1999] ETMR 690; [1999] FSR 627. In that case the proprietor of the trade mark LLOYD for footwear alleged infringement by use of a LOINT's sign on shoes and footwear. Having considered the question asked by the relevant court, the ECJ said:

"12. Accordingly, by its questions, which it is appropriate to examine together, the national court is seeking clarification from the Court on the following matters:

the criteria to be applied in assessing the likelihood of confusion within the meaning of Article 5(1)(b)of the Directive;

the significance to be attached to the wording of the Directive, according to which the likelihood of confusion includes the "likelihood of association" with the earlier mark; and

the effect to be ascribed, in assessing the likelihood of confusion, to the fact that the mark is highly distinctive."

51. Having set out the submission of the parties and the Commission, the ECJ said:

"17. According to the case law of the Court of Justice, the risk that the public might believe that the goods or services in question come from the same undertaking or, as the case may be, from economically-linked undertakings, constitutes a likelihood of confusion within the meaning of Article 5(1)(b) of the Directive (see, to that effect, SABEL, paragraphs 16 to 18, and Case C-39/97 Canon [1998] ECR I-5507, paragraph 29). It follows from the very wording of Article 5 (1)(b) that the concept of likelihood of association is not an alternative to that of likelihood of confusion, but serves to define its scope (see, to that effect, SABEL, paragraphs 18 and 19).18. According to the same case law, likelihood of confusion on the part of the public must be appreciated globally, taking into account all factors relevant to the circumstances of the case (see, to that effect, SABEL, paragraph 22).19. That global assessment implies some interdependence between the relevant factors, and in particular a similarly between the trade marks and between the goods or services covered. Accordingly, a lesser degree of similarity between those goods or services may be offset by a greater degree of similarity between the marks, and vice versa. The interdependence of these factors is expressly mentioned in the tenth recital in the preamble to the Directive, which states that it is indispensable to give an interpretation of the concept of similarity in relation to the likelihood of confusion, the appreciation of which depends, in particular, on the recognition of the trade mark on the market and the degree of similarity between the mark and the sign and between the goods or services identified (see Canon, paragraph 17).20. Furthermore, the most distinctive the earlier mark, the greater will be the likelihood of confusion (SABEL, paragraph 24), and therefore marks with a highly distinctive character, either per se or because of the recognition they possess on the market, enjoy broader protection than marks with a less distinctive character (see Canon, paragraph 18).21. It follows that, for the purposes of Article 5(1)(b) of the Directive, there may be a likelihood of confusion, notwithstanding a lesser degree of similarity between the trade marks, where the goods or services covered by them are very similar and the earlier mark is highly distinctive (see, to that effect, Canon, paragraph 19).22. In determining the distinctive character of a mark and, accordingly, in assessing whether it is highly distinctive, the national court must make an overall assessment of the greater or lesser capacity of the mark to identify the goods or services for which it has been registered as coming from a particular undertaking, and thus to distinguish those goods or services from those of other undertakings (see, to that effect, judgment of May 4, 1999 in Joined Cases C-108/97 and C-109/97 Windsurfing Chiemsee v. Huber and Attenberger [1999] E.C.R. I-0000, paragraph 49).23. In making that assessment, account should be taken, in particular, of the inherent characteristics of the mark, including the fact that it does or does not contain an element descriptive of the goods or services for which it has been registered; the market share held by the mark; how intensive, geographically widespread and long-standing use of the mark has been; the amount invested by the undertaking in promoting the mark; the proportion of the relevant section of the public which, because of the mark, identifies the goods or services as originating from a particular undertaking; and statements from chambers of commerce and industry or other trade and professional associations (see Windsurfing Chiemsee, paragraph 51).24. It follows that it is not possible to state in general terms, for example by referring to give[n] percentages relating the degree of recognition attained by the mark within the relevant section of the public, when a mark has a strong distinctive character (see, to that effect, Windsurfing Chiemsee, paragraph 52).25. In addition, the global appreciation of the likelihood of confusion must, as regards the visual, aural or conceptual similarity of the marks in question, be based on the overall impression created by them, bearing in mind, in particular, their distinctive and dominant components. The wording of Article 5(1)(b) of the Directive--". . . there exists a likelihood of confusion on the part of the public . . ."--shows that the perception of marks in the mind of the average consumer of the category of goods or services in question plays a decisive role in the global appreciation of the likelihood of confusion. The average consumer normally perceives a mark as a whole and does not proceed to analyse its various details (see, to that effect, SABEL, paragraph 23).26. For the purposes of that global appreciation, the average consumer of the category of products concerned is deemed to be reasonably well-informed and reasonably observant and circumspect (see, to that effect, Case C-210/96 Gut Springenheide and Tusky [1968] E.C.R. 1-4657, paragraph 31). However, account should be taken of the fact that the average consumer only rarely has the chance to make a direct comparison between the different marks but must place his trust in the imperfect picture of them that he has kept in his mind. It should also be borne in mind that the average consumer's level of attention is likely to vary according to the category of goods or services in question.27. In order to assess the degree of similarity between the marks concerned, the national court must determine the degree of visual, aural or conceptual similarity between them and, where appropriate, evaluate the importance to be attached to those different elements, taking account of the category of goods or services in question and the circumstances in which they are marketed."

52. The judge concluded that use of FREESTYLE CRUISING for booking and arranging cruises in the manner used by Norwegian was not likely to cause confusion with Thomson's marks when fairly used in respect of land-based holiday activities or services. Mr Bloch submitted that the judge was right to come to that conclusion. Further the judge had properly instructed himself as to the law and then applied it. In those circumstances this Court should be slow to substitute another opinion as to whether there would be confusion which was a question of fact: a sort of jury question. He reminded us of what was said by the House of Lords in Biogen Incorporated v Medeva Plc [1997] RPC 1 and Designers Guild v Russell Williams Textiles Ltd [2001] FSR 113.
53. Mr Baldwin accepted that this court should be slow to substitute its decision as to whether there would be confusion for a judge's decision properly made. However he submitted that the judge had erred in principle and therefore this Court should consider the matter afresh. It is therefore necessary to consider the judgment and, when doing so, I will concentrate upon those parts which Mr Baldwin submitted contained the major error.
54. As I have said, the judge rightly concluded that Norwegian's use of "FREESTYLE" whether used on its own or when combined as "FREESTYLE CRUISING" or indeed as "NCL FREESTYLE CRUISING" was use of the registered trade mark FREESTYLE. He therefore concluded that there was identity between the registered trade mark and the sign as used by Norwegian.
55. The most serious criticism of the judgment was that the judge had failed to follow the guidance of ECJ in the Canon and Lloyd cases as to what was the relevant question for the court to consider. In paragraph 29 the judge said this:

"Therefore the question is, assuming a fair and normal use of the registered trade marks FREESTYLE for travel, tours and/or holiday products other than cruises, would the average member of the public interested in a cruise holiday product branded as FREESTYLE CRUISING believe the product was either a product of the Claimants or a product associated with the providers of FREESTYLE land based holiday and travel products."

56. Mr Baldwin is right that the judge considered the wrong question. As he pointed out, in paragraph 29 of the ECJ's judgment in Canon the test was stated in terms of "a risk" "that the public might believe that the goods or services in question come from the same undertaking or, as the case may be, from economically-linked undertakings, constitute a likelihood of confusion …". The judge had adopted the higher test of whether the public would believe the product was that of the proprietor or an associated product. Further the judge failed to make allowance for imperfect recollection (see paragraph 26 of the judgment in the Lloyd case).
57. Mr Baldwin also drew attention to paragraphs 33 and 35 of the judgment.

"33. … Such evidence whilst relevant to whether the booking and arranging of cruise holidays relates to services which are similar to the booking and arranging of land holidays, does not assist in resolving whether the Defendants' use of the sign "Freestyle Cruising" is likely to be confused with the Claimants' marks as used in relation to land based holidays services.

…

35. In my opinion for the reasons given above, the mark Freestyle is neither inherently sufficiently distinctive nor has it acquired such distinctiveness in the market place and given the message that the use of the sign Freestyle Cruising is likely to convey to the average consumer and also given the widespread adoption of the sign Freestyle in relation to other trading activities, I do not consider that the use of the sign Freestyle Cruising for booking and arranging cruises in the manner used by the Defendants is likely to cause confusion with the Claimants' marks when fairly used in respect of land based holiday activities or services. In the result the Claimants' action fails. I shall hear Counsel on the relief sought."

58. In paragraphs 33 and 35 the judge does not refer to the likelihood of association and therefore there appears to be a different test applied to that posed in paragraph 29 of his judgment (see paragraph 55 above). There is no need to try to decide, using the intervening paragraphs of the judgment, whether the judge did apply different tests as on any basis the test applied was not correct. Therefore this Court would have had to reconsider section 10(2) confusion afresh.
59. The word FREESTYLE does not describe a holiday, but as Mr Bloch submitted, it is evocative. Thus the mark FREESTYLE is not "highly distinctive" in the sense that the ECJ postulated in the Lloyd case. Nor is it well-known to the relevant public. It follows as the judge found, Thomson cannot rely upon the mark FREESTYLE as having a strong distinctive character. Thus section 10(2) confusion has to be judged between FREESTYLE used in a fair and normal way in respect of services such as arranging packaged holidays and the use that Norwegian have made of the mark.
60. As the ECJ pointed out in the Lloyd case, the risk that the public might believe that the services come from the same company or economically linked companies has to be decided having regard to all the relevant circumstances. They include the similarity of the marks visually, aurally and conceptually. The matter has to be judged through the eyes of reasonably well-informed and reasonably observant consumers with normal imperfect recollection. Such persons do not always compare the two uses side by side. Thus due allowance must be made for the occasions when the person who sees the other use has only a general recollection of the normal and fair use by the proprietor of the trade mark.
61. In the present case Norwegian are using FREESTYLE. The use of the word CRUISING when added does not differentiate between the normal and fair use of FREESTYLE by the proprietor in relation to other package holidays as it is wholly descriptive of the product. For example, Norwegian use FREESTYLE in a stylised form (see paragraph 16 above) with the words WORLDWIDE CRUISING underneath. Such use would convey to the average consumer that the world-wide cruises described in the brochure were being marketed under the brand name FREESTYLE.
62. On the assumption that cruises on cruise ships are excluded, the comparison has to be made with the normal and fair use by the proprietor in relation to services for other package holidays. Such holidays are sold through travel agents. They display leaflets in their windows advertising such holidays and provide shelves containing brochures and leaflets which give details of the package holidays that are available.
63. Cruises are also marketed through travel agents. Some companies provide cruises in the same brochure as their other package holidays. As the judge held, 60% of the total suppliers of cruise holidays also supply land-based holidays under the same name. Further the evidence was that brochures for cruises and other package holidays were often displayed on the same shelves.
64. It follows that what is being compared is use of identical marks upon different types of package holidays provided through the same trade channels in the same way, and often in the same brochure. In those circumstances, there must be a risk that the average consumer, with imperfect recollection of the normal and fair use by the proprietor of FREESTYLE, would conclude that Norwegian's cruises came from the same company or from an economically linked company. The suggestion that such customers would see Norwegian's use of FREESTYLE as a message of what was being offered cannot be right as the word is not descriptive of the product. In any case, Norwegian have used the word in stylised form.
65. For the reasons given, I have concluded that even if the judge was right that the specification should be amended so as to exclude cruises on cruise ships, there would be infringement under section 10(2).
66. Conclusion – For the reasons given I would allow the appeal and set aside the judge's order. Thomson have established infringement of their partially revoked trade marks. I would wish to hear submissions from the parties as to the correct order to make.

Lord Justice Waller:

67. I agree.

Lord Justice Scott Baker:

68. I also agree.