England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		Royal Courts of Justice Strand, London, WC2A 2LL
		04/02/2014

Further Judgment

Mrs Justice Rose :

1. I handed down the main judgment in this case on 19 September 2013 in Roger Maier v ASOS plc [2013] EWHC 2831 (Ch) ('the Main Judgment'). On 16 October 2013, after a further short hearing to deal with various consequential matters, I made the final order on the matters dealt with in the Main Judgment.
2. There was one matter left over for my decision, namely the part of Assos' claim that challenged the registration of ASOS' UK trade mark. It was agreed that the claim for partial invalidity of UK trade mark number UK00002530115 would be dealt with after the main trial and on the papers. Both parties have made written submissions to me on that issue.
3. To recap briefly the effect of the Main Judgment and final order:

i) ASOS' claim pursuant to Article 51 CTMR for partial revocation of Assos' CTM has been successful to the extent that:

a) the scope of the CTM as regards goods in Class 3 is limited to preparations for the treatment or prevention of ailments associated with cycling; cleaning products for specialist cycling clothes;

b) Class 12 is limited to bicycles and parts and fittings thereof;

c) Class 25 is limited to specialist clothing for racing cyclists; jackets, t-shirts, polo shirts, tracksuit tops, tracksuit bottoms, casual shorts, caps.^[1]

ii) the counterclaim for partial invalidity of the CTM under Article 8(4) CTMR was dismissed because ASOS did not establish that they had sufficient goodwill in their sign as at June 2005 (the priority date for Assos' mark) to have been able to prevent the registration of Assos' mark on the basis of a passing off action.

iii) the claim by Assos under Article 9(1)(b) CTMR that ASOS' sign infringed its CTM was dismissed on the basis, primarily, that the relevant average consumer was not likely to be confused into thinking that ASOS products are made by Assos or by a company linked with Assos.

iv) the claim by Assos under Article 9(1)(c) CTMR was dismissed on the basis that there was no evidence that the presence of ASOS in the market had diluted the ability of Assos to be associated with its mark and no evidence of 'swamping'.

4. ASOS' UK trade mark was filed on 28 October 2009 and covers a very wide range of goods within Classes 3, 8, 9, 11, 14, 18, 21, 25 and 26, and services within Class 35 (retailing goods by internet or other means) and Class 36 (providing credit). The mark on which Assos relies in challenging the ASOS UK mark is the CTM which was the subject of the Main Judgment. It is accepted by Assos for present purposes that that mark has the reduced scope resulting from my final order. The parts of the ASOS mark registration challenged by Assos are as follows – the items underlined are alleged to be identical and the remainder to be highly similar to the items protected by the Assos mark:

Class 3 Skin care preparations; preparations for the bath and shower; moisturisers; body lotions and creams; moisturising creams; body oil; non-medicated skin care beauty products; skin care products for personal use, namely, face, eye and lip moisturisers; face and skin creams; lotions and serums;

Class 25 Articles of clothing; headgear; hats; caps; berets; belts (being articles of clothing); shirts, casual shirts, t-shirts, vests, camisoles, bodysuits, polo shirts, sports shirts, football and rugby shirts; trousers, jeans, shorts, sports shorts, underwear; tracksuits; articles of outerwear, coats, jackets, casual jackets, waterproof and weatherproof jackets and coats, body warmers; sweatshirts; jumpers; headbands; menswear; womenswear.

Class 35 The bringing together for the benefit of others, of a variety of bathing and personal cleansing and care products, clothing, sporting goods, fitness equipment, enabling customers to conveniently view and purchase those goods from an Internet web site or by means of telecommunications or by means of a global network or by mail order catalogue or from a retail store.

5. The claim for the partial invalidity of the ASOS UK mark is brought pursuant to section 47(2) of the Trade Marks Act 1994. This provides that the registration of a trade mark may be declared invalid on the ground that there is an earlier mark in relation to which the conditions in section 5(1), (2) or (3) pertain, or that there is an earlier right in relation to which the condition set out in section 5(4) is satisfied. Section 47(5) provides that a challenge may be made to part only of a registration. Assos relies here on the following provisions of the Trade Marks Act 1994:

i) Section 5(2)(b) which provides that a mark shall not be registered if, because it is similar to an earlier trade mark and is to be registered for goods or services identical with or similar to those for which the earlier trade mark is protected, there exists a likelihood of confusion on the part of the public, which includes the likelihood of association with the earlier trade mark;

ii) Section 5(3) which provides that a trade mark which is identical with or similar to an earlier trade mark shall not be registered if, or to the extent that, the earlier trade mark has a reputation in the European Union and the use of the later mark without due cause would take unfair advantage of or be detrimental to the distinctive character or repute of the earlier trade mark;

iii) Section 5(4)(a) which provides that a trade mark shall not be registered if, or to the extent that, its use in the United Kingdom is liable to be prevented by the law of passing off protecting an unregistered mark or other sign used in the course of trade.

Section 5(2)(b) and section 5(4)(a) of the Trade Marks Act 1994

6. Some elements of the test to be applied under section 5(2)(b) are the same as I considered in the parts of the Main Judgment dealing with the alleged infringement under Article 9(1)(b) of the CTMR. I am satisfied that the ASOS UK mark is sufficiently similar to the earlier Assos mark to fall within this provision. I am also satisfied that some of the goods for which the ASOS mark is registered are identical with or similar to products or services which fall within Assos' registration, even with the reduced scope for the CTM as set out in the final order. For example, in Class 3, the products referred to in the ASOS registration include skin care preparations, body lotions and creams. These are identical with, or similar to, Assos products which I described in paragraph 63 of the Main Judgment. In Class 25 the ASOS UK mark covers t-shirts, polo shirts, tracksuits, casual jackets and weather proof jackets.
7. The key question is whether there is a likelihood of confusion between the goods produced under the ASOS UK mark and the goods produced by Assos under its CTM. My findings in the Main Judgment that there was no risk of confusion between the goods in fact sold by ASOS and the goods covered by the Assos CTM are not determinative of this key question. That is because the test to be applied in the context of an alleged infringement by ASOS of the Assos CTM (which was the issue in the Main Judgment) is different from the test to be applied in the context of a challenge to the validity of the ASOS UK mark. This difference was explained by the Court of Justice in Case C-533/06 O2 Holdings, O2 (UK) Limited v Hutchison 3G UK Ltd. [2008] ECR I-4231. That concerned the allegation that the use by H3G in its own advertising of O2's bubbles mark for the purpose of comparing O2's service unfavourably with the service being advertised by H3G was an infringement of O2's mark. The Court of Justice held that the referring court had been right to consider the issue of confusion on the basis only of the use in fact made by H3G of the mark. On that basis there was no risk of confusion. This would have been different if H3G had been trying to register a bubbles mark which was very similar to O2's. In that context, the court would have to consider whether there was a risk of confusion between the marks in all the circumstances in which the mark applied for might be used if it were to be registered. It is worth setting out what the Court of Justice said on this point:

"63 … in accordance with the referring court's own findings, the use by H3G, in the advertisement in question, of bubble images similar to the bubbles trade marks did not give rise to a likelihood of confusion on the part of consumers. The advertisement, as a whole, was not misleading and, in particular, did not suggest that there was any form of commercial link between O2 and O2 (UK) on the one hand, and H3G, on the other.

64 In that regard, contrary to the submission of O2 and O2 (UK), the referring court was right to limit its analysis to the context in which the sign similar to the bubbles trade marks was used by H3G, for the purpose of assessing the existence of a likelihood of confusion.

65 It is true that the notion of likelihood of confusion is the same in Articles 4(1)(b) and 5(1)(b) of Directive 89/104 (see, to that effect, Case C-425/98 Marca Mode [2000] ECR I-4861, paragraphs 25 to 28).

66. Article 4(1)(b) of Directive 89/104, however, concerns the application for registration of a mark. Once a mark has been registered its proprietor has the right to use it as he sees fit so that, for the purposes of assessing whether the application for registration falls within the ground for refusal laid down in that provision, it is necessary to ascertain whether there is a likelihood of confusion with the opponent's earlier mark in all the circumstances in which the mark applied for might be used if it were to be registered.

67. By contrast, in the case provided for in Article 5(1)(b) of Directive 89/104, the third-party user of a sign identical with, or similar to, a registered mark does not assert any trade mark rights over that sign but is using it on an ad hoc basis. In those circumstances, in order to assess whether the proprietor of the registered mark is entitled to oppose that specific use, the assessment must be limited to the circumstances characterising that use, without there being any need to investigate whether another use of the same sign in different circumstances would also be likely to give rise to a likelihood of confusion."

8. In the same way, in this case my consideration of the risk of confusion should not be limited to considering how ASOS attaches its sign to t-shirts and tracksuits now but must consider whether confusion would arise if ASOS changed its current practice and attached its UK mark to t-shirts and tracksuits in a different way, closer to the way in which Assos is entitled to use its mark. I also bear in mind that the comparison with the Assos mark is not simply a comparison with the Assos mark as it is currently used by Assos but with the notional fair use by them of that mark, albeit in this case, since the mark has been reduced by excluding areas of non-use, there is not so much difference between those two concepts. In the context of the current inquiry I must consider whether there would be a risk of confusion with the Assos mark if, for example, ASOS opened a bricks-and-mortar shop and started selling t-shirts or tracksuits with the mark 'ASOS' written prominently on the front. Such a use could be said to be within the fair, notional use of the current ASOS UK mark.
9. I remind myself of the factors that I need to bear in mind in assessing the likelihood of confusion: see the summary of factors set out by Arnold J in Interflora v Marks & Spencer [2013] EWHC 1291 paragraphs 183 to 185. Applying those factors to the present case, would such notional use by ASOS of its mark create the risk of confusion so that a potential customer of Assos products might buy such a t-shirt believing that he or she was buying an Assos t-shirt?
10. In my judgment it would not. As I stated in paragraph 92 of the Main Judgment, the reason people buy Assos casual clothes is to associate themselves with the mark's reputation as a prestige brand of professional cycling wear. The brand does not have a separate reputation as a make of casual clothing whether of a premium or ordinary kind. A person buying an item in the Dopo Bici range will ensure that they are buying the real Assos brand before making the significant financial outlay that is required to become the owner of such a garment. Potential purchasers of the cheaper, prominently branded Assos casual clothes are also buying the item only because they want to display their knowledge of, and some connection with, the premium cycling brand. ASOS could, on the basis of their UK mark, sell t-shirts which display the word comprising their mark 'ASOS' more prominently on the front rather than discreetly on an inside label as they currently do. However, it is unlikely that a member of their target audience, that is a fashion conscious, twenty-something person would be interested in buying such a garment. If the fashion conscious person has heard of Assos and is a keen cyclist (as well as being fashion conscious) then he or she will be motivated to recognise the difference between the Assos mark and an ASOS mark on an item of ordinary casual clothing. In my judgment there is unlikely to be any material confusion between the two marks even if ASOS started to apply its trade mark to t-shirts in a very different and more prominent way from the way it currently does.
11. I have considered the scenario, albeit an unlikely one, that ASOS decides to go into direct competition with Assos and produce its own range of 'hardcore' specialist cycling apparel and skin rash cream designed to alleviate cycling ailments, all bearing the ASOS brand. The list of items covered by the ASOS UK mark includes bodysuits, sports shirts and sports shorts and leggings. I would be concerned if ASOS at some point sought to take advantage of the similarity of the marks and the breadth of the items listed in their registration to market specialist cycling gear. I note the discussion of the POSTKANTOOR principle by Arnold J in his judgment in Omega Engineering Incorporated v Omega SA [2012] EWHC 3440 (Ch), paragraphs 43 onwards. That principle determines the ability of a competent authority to carve out from a wide class of goods a smaller category not to be included in the registration. The Court of Justice in the POSTKANTOOR case, Case C-363/99 Koninklijke KPN Nederland NV v Benelux-Merkenbureau [2004] ECR I-1619, drew a distinction between seeking to register marks only in so far as the goods concerned 'do not possess a particular characteristic' which is not permissible and registering the mark only in respect of some of the goods belonging to the wider class which is permissible. Arnold J referred to the difficulties that had been caused by the application of the Court's ruling in deciding whether a particular proposed carve out from the wider class amounts to the permissible excising a particular product from the class or the impermissible attempt to identify a characteristic of the class of products.
12. In the light of the case law discussed in Omega I consider that it would be permissible and also appropriate to make the following adjustments to the current specification of the ASOS UK mark:

i) To limit the goods covered by Class 3 to exclude preparations for the treatment or prevention of ailments associated with cycling and cleaning products for specialist cycling clothes; and

ii) To limit the goods covered by Class 25 to exclude specialist clothing for racing cyclists.

13. The third scenario I have considered is if ASOS produced a range of ordinary casual clothes with their mark prominently displayed on it and some clear association with cycling or, say, with the Swiss Cycling Federation. For example, if ASOS sold a t-shirt with the prominent slogan "All the best cyclists wear ASOS" on the front, would that count as a fair, notional use of the UK mark from which Assos is entitled to protection and, if not, should that lead me to conclude that the ASOS mark should be cut back to exclude t-shirts? In the light of the POSTKANTOOR principle, it is not possible to exclude from the wording of the ASOS UK mark t-shirts or tracksuits targeted at cyclists or associated in some way with cycling. However, such use would start to stray into the territory of passing off. Assos would not be precluded from bringing an action in passing off by the mere fact that ASOS' UK trade mark continues to apply to t-shirts and tracksuits.
14. Turning to section 5(4) of the 1994 Act, this provides that the ASOS mark should not have been registered if its use in the United Kingdom was liable to be prevented by an action for passing off at the suit of Assos. Assos accept that the assessment under section 5(4) does not fall to be determined differently from that under section 5(2)(b). In my judgment, both the claims fail because of the absence of any real risk of confusion.

Section 5(3) of the Trade Marks Act 1994

15. Section 5(3) provides that a trade mark which is identical with or similar to an earlier trade mark shall not be registered if the earlier trade mark (here the Assos CTM) has a reputation in the EU and the use of the sign, without due cause, would take unfair advantage of or be detrimental to the distinctive character or the repute of the earlier trade mark. Again, I bear in mind that the test that I applied in considering the alleged infringement of Article 9(1)(c) CTMR in the Main Judgment (see paragraphs 126 onwards) is not the same test as I am applying here because I am considering the fair, notional use of the proposed ASOS UK mark, not its actual use so far. That, Assos say, includes situations where the ASOS use would overlap with Assos' reputation, although I bear in mind that I am considering the reputation Assos enjoyed in 2009 (when the ASOS mark was applied for).
16. It seems to me that despite these differences of context, the points made in the Main Judgment paragraphs 169 onwards in which I rejected the Assos claim for passing off apply equally to this part of the challenge to the UK mark. I consider that the only way that ASOS would risk diluting Assos' reputation would be if they started selling specialist cycling clothing (which I have ruled out by excluding that from the scope of the UK mark) or using their sign in a way which would lay them open to a claim for passing off. I therefore find that the ASOS UK mark would not take undue advantage of or be detrimental to the distinctive character or repute of Assos' CTM.
17. It follows that the challenge to the ASOS UK mark fails.

Note 1   This formulation is different from that set out in paragraph 62 of the Main Judgment in that the word ‘including’ is omitted. This was one of the matters considered at the post-Main Judgment hearing and dealt with in the final order.     [Back]