England and Wales High Court (Patents Court) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		29/10/97

Mr. Justice Laddie:

1. This is an action for passing off. The second and third plaintiffs, Kraft Jacobs Suchard (Schweiz) AG and Chocoladefabriken Lindt & Sprüngli (Schweiz) AG respectively, are well known manufacturers of chocolate confectionery. In this judgment I shall refer to the second plaintiff and its chocolate-making predecessors as "Suchard" and to the third plaintiff and its chocolate-making predecessors as "Lindt". Suchard and Lindt have been involved in the manufacture of chocolate for a very long time. The history of Suchard can be traced back to 1826 when Philippe Suchard opened a small chocolate factory in Serrières near Neuchâtel. The company grew and its products were sold not only in Switzerland but were exported extensively. The modern Lindt company can be traced back to two earlier businesses. One was started by Rodolphe Sprüngli-Ammann who opened the first chocolate factory in the German-speaking part of Switzerland in the early 19th Century. The other was started by Rodolphe Lindt who set up his business in 1879 in Berne. Like Mr. Sprüngli-Ammann's business, Mr. Lindt's business expanded and it began to export its products.
2. The first plaintiff, CHOCOSUISSE Union Des Fabricants Suisses de Chocolat, to which I will refer as "Chocosuisse", is a cooperative society formed under the Swiss Code of Obligations. It is an association for the Swiss chocolate industry of which 13 out of 16 Swiss chocolate manufacturers are members. Lindt and Suchard are members.
3. Swiss chocolate makers have played a major role over the years in the development of the art and technology of chocolate making. According to the plaintiffs, chocolate made in Switzerland has acquired in this and other countries a reputation for quality. It was for this reason that Chocosuisse was formed. One of its main tasks is the protection of the denomination of origin "Swiss" against any use which it and its members regard as illegitimate. Mr. Rolf Bloch, who is currently a board member of Chocosuisse and the chairman of the Chocosuisse committee for the protection of the designation of origin "Swiss chocolate", gave evidence in these proceedings that since its establishment in 1945 Chocosuisse has taken steps against more than 600 instances of what it regarded as misuse of the Swiss designation for chocolate. Most of those actions consisted of warnings issued to companies believed to be infringing the Swiss chocolate manufacturers' claimed rights in the word "Swiss" or "Switzerland". Most targets of these efforts complied with Chocosuisse's requests without further ado. There have been few cases, and none in the United Kingdom, which tested the strength of those claimed rights. Although Chocosuisse was only established in 1945, its activities are a continuation of the activities carried on by a previous trade association of Swiss chocolate makers.
4. The defendant, Cadbury Limited, hardly needs any introduction. It is a member of the group of companies headed by Cadbury Schweppes PLC. It has been in the chocolate business for over one hundred years and the evidence of its current Marketing Director, Mr. Alan Palmer, shows that it is now the United Kingdom's leading chocolate confectionery manufacturer. Over the years its product range was extended to chocolate confectionery products, including the most popular moulded chocolate bar in the United Kingdom, Dairy Milk, one of the most popular boxed chocolate brands, Milk Tray, and other well known brands such as Crunchie and Flake. Its wide range of chocolate products are sold under a variety of names. Some of those names, like Milk Tray, Crunchie, Flake, Mint Crisp and Fruit and Nut, allude to the characteristics of the product which bear them. Other names, such as Tiffin and Top Deck, do not. Cadbury's current product range includes chocolate confectionery, sugar confectionery and cocoa based drinks and in addition dairy products, milk and milk products, drinks, yoghurt, desserts, trifles, mousse, biscuits, wafers, cakes, ice cream and frozen gateaux. Mr. Palmer said, and it was not disputed, that "Cadbury" is a household name and is the pre-eminent name for chocolate in the United Kingdom. In the United Kingdom sales of Cadbury branded products last year totalled well in excess of £1 billion. Outside the United Kingdom and Ireland the businesses of the group of which Cadbury is part have been largely Commonwealth based, with major businesses in Australia, New Zealand, South Africa and Canada. More recently, as part of its global expansion, Cadbury Schweppes PLC has acquired and set up businesses in many other parts of the world.
5. The current dispute arises out of the introduction onto the market by Cadbury of a new chocolate product called "Swiss Chalet". This is a confectionery bar which is made of honey flavoured milk chocolate with inclusions consisting of small pieces of almond nougat. The front of the packaging bears upon it in large, gold rimmed red letters the words "Swiss Chalet" and, in a slightly smaller size, the well known script form of the word "Cadbury". The packaging also carries a picture of the snow-capped Matterhorn Mountain in Switzerland with a chalet in a valley below it and the Cadbury "glass and a half" logo. The front of the packaging is reproduced in Annex I to this judgment.
6. Both sides agreed that the relevant legal principles for a passing off case like this are as set out in Erven Warnink BV v. J. Townend & Sons (Hull) Limited [1980] RPC 1 (the Advocaat case). In particular the plaintiffs, represented by Mr. Simon Thorley QC and Mr. Colin Birss, relied on the formulation in the speech of Lord Fraser which they said was directed specifically to the present type of passing off action - namely one concerning a class of goods:

"It is essential for the Plaintiff in a passing off action to show at least the following facts:

(1) That his business consists of, or includes, selling in England a class of goods to which the particular trade name applies;

(2) That the class of goods is clearly defined, and that in the minds of the public, or a section of the public, in England, the trade name distinguishes that class from other similar goods;

(3) That because of the reputation of the goods, there is a goodwill attached to the name;

(4) That he, the Plaintiff, as a member of the class of those who sell the goods, is the owner of goodwill in England which is of substantial value;

(5) That he has suffered, or is really likely to suffer, substantial damage to his property in the goodwill by reason of the Defendant selling goods which are falsely described by the trade name to which the goodwill is attached." (p. 105/₄₁- 106/₅)

7. The defendant, represented by Mr. Michael Bloch and Mr. Richard Meade, said that Chocosuisse failed to meet the requirements set out in the first of Lord Fraser's five criteria and therefore had no locus to sue. It also argued that all the plaintiffs failed in relation to all of the other criteria. Further it said that all three plaintiffs were debarred, by reason of their own unclean hands, from obtaining any relief in this action, even if passing off was proved.
8. Before dealing with each of these issues in turn, it may be useful to look with some care at the law in this area.

The Law

9. The speech of Lord Diplock in Advocaat traces the history of the action for passing off starting with Perry v. Truefitt (1842) 6 Beav 66, 49 E.R. 749 in which Lord Langdale MR said:

"I think that the principle on which both the courts of law and of equity proceed, in granting relief and protection in cases of this sort, is very well understood. A man is not to sell his own goods under the pretence that they are the goods of another man; he cannot be permitted to practice such a deception, nor to use the means which contribute to that end. He cannot therefore be allowed to use names, marks, letters or other indicia, by which he may induce purchasers to believe, that the goods which he is selling are the manufacture of another person. I own it does not seem to me that a man can acquire property in a name or mark; but whether he has or not a property in the name or mark, I have not doubt that another person has not the right to use that name or mark for the purposes of deception, and in order to attract to himself the course of trade, or that custom, which, without the improper act, would have flowed to the person who first used, or was alone in the habit of using the particular name or mark."

10. As Lord Diplock pointed out, citing the words used by Lord Parker in Spalding v. Gamage (1915) 32 RPC 273:

"...nobody has any right to represent his goods as the goods of somebody else." (page 283/₂₈)

11. Further on in his speech, Lord Parker said:

"There appears to be considerable diversity of opinion as to the nature of the right, the invasion of which is the subject of what are known as passing-off actions. The more general opinion appears to be that the right is a right of property. This view naturally demands an answer to the question - property in what? Some authorities say property in the mark, name, or get-up improperly used by the defendant. Others say, property in the business or goodwill likely to be injured by the misrepresentation. Lord Herschell in Reddaway v. Banham expressly dissents from the former view; and if the right invaded is a right of property at all, there are, I think, strong reasons for preferring the latter view. ... Further, it is extremely difficult to see how a man can be said to have property in descriptive words, such as "Camel Hair" in the case of Reddaway v. Banham where every trader is entitled to use the words, provided only he uses them in such a way as not to be calculated to deceive. Even in the case of what are sometimes referred to as Common Law Trade Marks the property, if any, of the so-called owner is in its nature transitory, and only exists so long as the mark is distinctive of his goods in the eyes of the public or a class of the public." (p. 284)

12. The type of action of which Perry v. Truefitt and Spalding v. Gamage are examples were described by Lord Diplock in Advocaat as the "classic form" of passing off. To succeed in this, the plaintiff has to prove that he has built up the necessary goodwill by his own endeavours or that he has acquired it from a predecessor who had done so. He can not succeed if he has just entered the market and not built up the necessary goodwill. Cases could arise where his rights are shared with someone else either because the original goodwill had been split between two or more successors or each owner had built up his own reputation himself and side by side with the others. Lord Diplock referred to Dent v. Turpin (1861) 2 J & H 139 and Southorn v. Reynolds (1865) 12 LT (NS) 75 as examples of this. Even so each of the owners of the shared reputation can sue to prevent someone else trying belatedly to use the same or a sufficiently similar name or mark. Indeed if the newcomer is trying to use the name or mark on essentially the same goods or services, the case for passing off will be more easily made out since the nature of the products or services will not help the public to distinguish between those derived from the plaintiff and those derived from the defendant. Furthermore the owner of the goodwill protected by a classic passing off action can do what he pleases with the mark. He can raise or lower the standards of his goods or products, change the location of manufacture, change the ingredients he uses and, if he wants, decide to use the mark or name on an entirely different range of goods or services, as long as this will not lead to a collision with some other trader who already uses the same or a similar name or mark in relation to the new line of business. This freedom of action arises because the goodwill belongs to the plaintiff and not to anyone else. The damage which he must prove to succeed in the action is damage to his business. However there are limits on the ability of a trader to acquire a protectable goodwill in a mark or name. In particular, on public policy grounds the courts will be most reluctant to allow him to obtain a monopoly in descriptive words, as noted by Lord Parker in the extract from Spalding v. Gamage cited above. Thus it is very difficult to succeed in a classic passing off action where the mark is highly geographical or where it is descriptive of or the name for a particular type of product.
13. The classic form of passing off action is to be contrasted with what Lord Diplock called the "extended form of passing off first recognised and applied by Dankwerts J. in the Champagne case (Bollinger v. Costa Brava Wine Co. Ltd. [1960] RPC 16)". That new form of action can be traced from the Champagne case, through the Sherry (Vine Products Ltd. v. Mackensie & Co. Ltd. [1969] RPC 1) and Scotch Whisky cases (John Walker & Sons Ltd. v. Henry Ost & Co. Ltd. [1970] RPC 489) to Advocaat itself. The most recent example of it is the Elderflower Champagne case (Taittinger SA v. Allbev Ltd. [1993] FSR 641). Although all these have grown from passing off roots, they display marked differences to the classic form of the cause of action. In the Champagne type of case, protection is given to a name or word which has come to mean a particular product rather than a product from a particular trader. Normally it is the perfect and perhaps only adequate term to describe the product. Just as an emulsion of fats and water together with other digestible ingredients derived from a cow is called milk and nothing else, so a sparkling white or rosé wine made in a particular defined area in France by a process of double fermentation in the bottle is called champagne and nothing else. The word is entirely descriptive of the product. This is clear from the speech of Lord Diplock where the descriptive nature of the mark was referred to on numerous occasions including in the following passage:

"In the Champagne case the descriptive term referred to the geographical provenance of the goods, and the class entitled to the goodwill in the term was accordingly restricted to those supplying on the English market goods produced in the locality indicated by it. Something similar was true in the Sherry case where the word "sherry" as descriptive of a type of wine unless it was accompanied by some qualifying geographical adjective was held to denote wine produced by the solera method in the province of Jerez de la Frontera in Spain and the class entitled to the goodwill in the word was restricted to suppliers on the English market of wine produced in that province. In the Scotch Whisky case the product with which the case was primarily concerned was blended whisky and the class entitled to the goodwill in the descriptive term "Scotch Whisky" was not restricted to traders who dealt in whisky that had been blended in Scotland but extended to suppliers of blended whisky wherever the blending process took place provided that the ingredients of their product consisted exclusively of whiskies that had been distilled in Scotland. But the fact that in each of these first three cases the descriptive name under which goods of a particular type or composition were marketed by the plaintiffs among others happened to have geographical connotations is in my view without significance. If a product of a particular character or composition has been marketed under a descriptive name and under that name has gained a public reputation which distinguishes it from competing products of different composition, I can see no reason in principle or logic why the goodwill in the name of those entitled to make use of it should be protected by the law against deceptive use of the name by competitors, if it denotes a product of which the ingredients come from a particular locality, but should lose that protection if the ingredients of the product, however narrowly identified, are not restricted as to their geographical provenance." (page 96)

14. The fact that the extended form of action can, in the correct circumstance, protect descriptive words is of significance for a number of reasons. First, at one stage during the course of his argument, Mr. Michael Bloch seemed to suggest that the plaintiffs could not succeed in this action because the expression Swiss chocolate was descriptive. However, it seems to me that type of argument will not of itself defeat a Champagne type of case. Furthermore the descriptiveness of the protected name also leads to other differences between this and the classic form of passing off. In the new extended form of the action, no proprietor currently using the name in relation to his goods can prevent any new competitor of his making or selling goods to which the name can accurately be applied and from using the name for that purpose. The current users of the descriptive word can only use their shared interest to prevent others from using it on products for which it is not a proper description or designation. Furthermore it is not open to any existing user of the protected name to use it on products for which it is not an accurate description or designation. Messrs Taittinger are no more entitled to use the word "Champagne" on a non-alcoholic cola drink than anyone else. Those entitled to use the word share a common interest in protecting its purity as a designation applied to a particular type of goods but in no real sense does it belong to an individual trader to do with as he likes. As Lord Diplock stated:

"... it is the reputation that that type of product itself has gained in the market by reason of its recognisable and distinctive qualities that has generated the relevant goodwill. So if one can define with reasonable precision the type of product that has acquired the reputation, one can identify the members of the class entitled to share in the goodwill ..." (p. 98)

15. The difference in this respect between the proprietor's rights in marks protectable by classic passing off proceedings and his rights in famous generic terms protectable by the extended form of passing off inevitably has impact on other parts of the action. In Advocaat it was said that mere entry into the market by a new trader who uses the term accurately on his products would not give him any right of action for passing off. Lord Diplock said, although it was not strictly in issue in the Advocaat case, that the new entrant must have himself used the descriptive term long enough on the market in connection with is own goods and have traded successfully enough to have built up a goodwill for his business before he could sue. In this respect the House of Lords was carrying over one of the factors which a plaintiff needed to prove in a classic passing off action. However the reality is somewhat different. Once a trader becomes a legitimate member of the trade using a protected descriptive term, he cannot be sued for passing off by other members of the trade and, if he joins in a passing off action to protect the term, the courts have not inquired too deeply into how extensive his own trade has been. By the same token the court does not look only or even primarily at the direct damage to the individual plaintiffs in the new form of action. In the Advocaat case it was pointed out that the plaintiff, Warnink, had no cause of action for passing off in its classic form because no member of the public would consider the defendant's product to be either the plaintiff's product or a product from Holland (p. 91). However in holding that Warnink could sue successfully under the extended form of action Lord Diplock quoted with approval the finding of the trial judge that the defendant would cause:

"... damage to Warnink in the trade and the goodwill of their business both directly in the loss of sales and indirectly in the debasement of the reputation attaching to the name "Advocaat" if it is permitted to be used of alcoholic egg drinks generally and not confined to those that are spirit based." (p. 91/_{18 - 24} emphasis added).

16. What can be protected by this form of action is the accuracy and exclusivity of the descriptive term. This is apparent not only from the passage in Advocaat just quoted, but also from the recent decision of the Court of Appeal in the Elderflower Champagne case. There the plaintiff, Taittinger, sued a company which was making a non-alcoholic sparkling drink in Surrey which it was selling under the name "Elderflower Champagne". The trial judge had held that all the necessary ingredients for a successful passing off action had been made out save for proof of likelihood of substantial damage to the plaintiff. In the Court of Appeal the plaintiff argued that the trial judge had erred because if the defendant continued to call its product "Elderflower Champagne":

"... the effect would be to demolish the distinctiveness the word champagne, and that would inevitably damage the goodwill of the champagne houses." (p. 669)

17. This argument was accepted. Peter Gibson LJ, having cited a passage from CIVC v. Wineworths [1991] 2 NZLR 327, said:

"By parity of reasoning it seems to me no less obvious that erosion of the distinctiveness of the name champagne in this country is a form of damage to the goodwill of the business of the champagne houses."

18. He also noted, with apparent approval, that Sir Robin Cooke P. in CIVC:

"thought the [Champagne] case exemplified the principle that a tendency to impair distinctiveness might lead to an inference of damage to goodwill..."

19. The point was also put clearly by the Master of the Rolls in the Elderflower Champagne case:

"Like the judge, I do not think the defendants' product would reduce the first plaintiffs' sales in any significant and direct way. But that is not, as it seems to me, the end of the matter. The first plaintiffs' reputation and goodwill in the description Champagne derive not only from the quality of their wine and its glamorous associations, but also from the very singularity and exclusiveness of the description, the absence of any qualifying epithets and imitative descriptions. Any product which is not Champagne but is allowed to describe itself as such must inevitably, in my view, erode the singularity and exclusiveness of the description Champagne and so cause the first plaintiffs damage of an insidious but serious kind. The amount of damage which the defendants' product would cause would of course depend on the size of the defendants' operation. That is not negligible now, and it could become much bigger. But I cannot see, despite the defendants' argument to the contrary, any rational basis upon which, if the defendants' product were allowed to be marketed under its present description, any other fruit cordial diluted with carbonated water could not be similarly marketed so as to incorporate the description champagne. The damage to the first plaintiffs would then be incalculable but severe." (p. 678)

20. It appears, therefore, that in this extended form of action it is mainly reduction of the distinctiveness of the descriptive term which is relied on as relevant damage. The difference between this and the type of damage which the plaintiff needed to show in a classic passing off action is illustrated in the judgment of Millet LJ in Harrods Ltd v. Harrodian School Ltd. [1996] RPC 697.
21. In the end, it is a matter of semantics whether the Champagne type of action is called a separate and new tort, as was suggested in Vine Products, or merely a new branch of the existing tort. That classic passing off and Champagne cases contain many features in common and the latter has developed out of the former is made clear by the speeches in Advocaat. But there are also significant differences to which I have made reference to above. Although in current state of development the common law does not recognise a general right in one trader to complain of damaging dishonest trading practices committed by his competitors, nevertheless in this area the law has advanced in effect to give rise to a civilly enforceable right similar to an appellation controlée. As both Dankwerts J. in Champagne and Lord Diplock in Advocaat explain, this development was justified on public policy grounds. This, it appears to me, is what lays behind the Master of the Rolls' views, expressed in Elderflower Champagne:

"... this is the reputation which the Champagne houses have built up over the years, and in which they have a property right. It is not in my view unfair to deny the defendants the opportunity to exploit, share or (in the vernacular) cash in on that reputation, which they have done nothing to establish. It would be very unfair to allow them to do so if the consequence was, as I am satisfied it would be, to debase and cheapen that very reputation."

22. Before turning to the facts in this case, there is one other matter of general principle which arises out of the arguments deployed in this case and is convenient to deal with here. In Advocaat Lord Diplock seemed to suggest that a plaintiff would need to show that the descriptive term had acquired a public reputation and goodwill:

"... denoting a product endowed with recognisable qualities which distinguish it from others of inferior reputation that compete with it in the same market." (p. 95)

23. The defendant relied on this passage but, rightly in my view, conceded that this could not mean that in all Champagne -type cases the descriptive term for which protection was sought only covered "superior" products. It conceded that it was enough if the qualities were different. In my view it goes somewhat further than this.
24. In a classic passing off action, it is not necessary to show that the plaintiff's goods are better, cheaper or in any other way different to those of the defendant or others in the trade. Indeed in many cases the major value of a successful trade mark is that it helps to draw in custom even when there is no inherent superiority or difference between goods or services bearing the mark and those not bearing it. To take a common current example, it is well known that a considerable number of companies sell fizzy cola drinks under their own brand names. Many of them are likely to be indistinguishable in taste or ingredients, the advances of technology having made it easier for one manufacturer's products to be analysed and copied by others. The difference in sales and the ability to charge higher prices can be attributed to effective marketing and, in particular, the use of well-known brand names. It is the reputation in the brand name which, to use the words of Lord MacNaghten in IRC v. Muller [1901] AC 217 at 223, is the attractive force which brings in custom. Although the products are the same, they come from distinct sources, that is to say separate manufacturers or retailers, and the customer learns to prefer one to the other because the trade mark is perceived by him to be a representation of good, reliable or merely known and liked quality, price, ingredients or merely for reasons of fashion or snob appeal.
25. It should be possible to protect by the extended form of passing off a descriptive term if it is used in relation to a reasonably identifiable group of products which have a perceived distinctive quality. If there is no difference or discernible difference in quality and ingredients between goods sold under or by reference to the term and competing goods, that should not prevent a successful passing off action from being brought. Thus the ability of the Champagne houses to sue successfully for passing off would not be destroyed if, in fact, other manufacturers in other areas of the world produced a sparkling wine equal in quality and indistinguishable in taste from any one of the numerous wines accurately sold as Champagne. On the contrary the fact that the Champagne still had a cachet which made products sold under that word more attractive to the customer is the hallmark of a particularly valuable mark. Similarly, if with modern technology foreign distillers were able to match the quality and taste of any of the wide range of beverages sold accurately under the name "Scotch Whisky", it would not diminish the right of traders dealing in the latter from succeeding in passing off against those who misused the name.
26. When Lord Diplock referred, in the passage cited above, to the reputation that the type of product has gained "by reason of its recognisable and distinctive qualities", I do not understand him to be saying that those qualities have to exist in fact and be distinctive in fact. If the relevant public believe or perceive there to be special qualities, that should be enough. If it were otherwise, this would be a significant difference between classic and extended passing off actions. It would be a limitation on the extended form of the action which would serve no real purpose but would undermine its usefulness in many, if not most cases. Furthermore, if one looks at Lord Fraser's formulation of the cause of action, there is no suggestion that the class of goods protected by the generic name must be distinguishable in fact from all competing goods. On the contrary, his speech seems to point in the opposite direction. As he put it, what is necessary is that there should be a defined class of goods to which the name applies and that, in the minds of the public or a section of the public "the trade name distinguishes that class from other similar goods" (my emphasis).
27. This point is of importance in this case because evidence was adduced directed to showing that there was no relevant difference in recipe and no discernible difference in taste between a Swiss chocolate made in Switzerland and some other chocolates made, for example, in a number of other countries on the continent of Europe. That a product of the same physical and taste attributes can be and is made outside Switzerland as is made inside is demonstrated, if it was ever in doubt, by the fact that a number of Swiss chocolate manufacturers have met the growing demand for their products by setting up factories in other countries in which they make chocolates to the same recipe and quality as those made in Switzerland. Subject to certain exceptions which I will deal with hereafter, these are not marked "Swiss" or "Swiss chocolates". However if the words "Swiss chocolate" otherwise meet the criteria for protection by passing off proceedings, I cannot believe that the plaintiffs should fail simply because products which are indistinguishable on a blind tasting are capable of being made and may in fact be made elsewhere. I do not read the speeches in Advocaat to require me to come to such a conclusion.

The Facts

Is there a class of goods with a protectable goodwill?

28. The words "Swiss chocolate" are clearly descriptive. It is only if they are taken by a significant part of the public to be used in relation to and indicating a particular group of products having a discrete reputation as a group that a case of passing off can get off the ground. I have had to bear this in mind when assessing the evidence of what the words mean to members of the public. If they convey nothing more than their descriptive meaning, the action must fail. The point can be illustrated by an example. If a trader used the expression "French ball-bearings" or "Italian pencils" neither would convey to most members of the public anything other than that the ball-bearings and the pencils came from France and Italy respectively. There is, as far as I am aware, no public perception that ball-bearings from France or pencils from Italy form a discrete group of products having any particular reputation. These expressions would therefore be taken as indicating nothing about the goods in respect of which they are used save that they come from a particular geographical location. If the expressions were used on ball-bearings or pencils made in England there would be, no doubt, a breach of the Trade Descriptions Act. But in the Champagne case it was held that that breach of the provisions of a predecessor to that Act, the Merchandise Marks Act, did not give rise to a civil cause of action. Since the two expressions are not associated with any particular group reputation, an action for passing off would fail. On the other hand a number of cases have held that the word Champagne, when put on a bottle of sparkling wine, is not merely descriptive of a group of products but that those products have a communal reputation or recognition which distinguishes them in the eyes of the public from wines not carrying that word. It is that communal reputation which is the basis for the cause of action. The necessity for this caution was illustrated by one of the evidence-gathering exercises conducted by the defendant. Two employees of the defendant's solicitors visited a shopping parade, bought a Cadbury Swiss Gateau and then asked about sixty members of the public in what country did they think the product was made. Only 7 said Switzerland. Noone suggested that this was a reliable market survey and it was not put forward as such. But even if most of the customers had volunteered without the benefit of a leading question that they thought the product came from Switzerland it would not have shown that the words "Swiss Gateau" have a reputation relevant for passing off purposes. All that it would show is that some people think that a Swiss gateau is made in Switzerland. Similarly, when a witness like Mr. Blacklock says^[1]:

"I was reasonably certain in my own mind that `Swiss chocolate' meant chocolate made in Switzerland."

this goes no way to demonstrating any relevant group reputation and it therefore does not assist the plaintiffs.

29. The evidence on this issue can be gathered into two categories; (i) members of the public, (ii) retailers and others in the trade.

(i) Members of the public

30. Witness statements from a number of members of the public were served. Some were the subject of Civil Evidence Act Notices, some were accepted without cross-examination and some were tested orally. Some guessed that Swiss chocolate referred only to chocolate made in Switzerland. For example Mrs Wilce said:

"Miss Tayler asked me what I took Swiss chocolate to mean ... I assumed I was to identify chocolate made in Switzerland although I did explain that I did not know much about it."

31. This type of evidence takes the plaintiffs' case nowhere. However there were many who thought it meant more than just a geographical origin. It appeared to have a reputation for quality, expense and exclusivity. A few examples of such evidence are set out below. A number of the defendant's witnesses were asked what Swiss chocolate meant to them. Among the responses were:

Ms. Petra Wöstefeld - "I said it was very smooth chocolate, smoother than English chocolate and it comes from Switzerland."

Mr. Ben Warner - "To me Swiss chocolate is quality and a tad exclusive. I'd say it comes from Switzerland."

Mrs. L. Tear - "I answered by stating I thought it was creamier chocolate which was more expensive. I assume it is from Switzerland."

Miss O'Connor - "I said I thought it was nicer, smoother and better chocolate. I said I thought it was made in Switzerland."

Mrs. Flinders - "To me Swiss chocolate means quality, good taste and usually it comes in nice packaging. To me Swiss chocolate is a luxury product. It has no real geographical significance. ... To me Swiss chocolate is just a quality product."

Mr. Dalton - "To me it is a higher quality chocolate, higher quality than everyday chocolate. The Swiss element does not mean that the product comes from Switzerland."

Ms Jarvis - "Dawn Osborne, asked me "What do you think of as Swiss chocolate?" I said "Better quality, whether it's true or not, I'm not sure"."

32. This evidence was consistent with some of the evidence given under cross examination.
33. Mr. Carpenter gave evidence that he ate chocolate himself but never Swiss chocolate. However he said that he did buy Swiss chocolate as a present for his girlfriend. When asked why he bought them for her rather than the sort of chocolates he ate himself he said:

"Because she has good taste, I suppose. I think it is associated like the best of the quality of the chocolate range."

34. Ms Susan Thompson also gave evidence that she did not buy Swiss chocolate but:

"A. No, I probably buy it as gifts, though.

Q. In preference to English chocolate?

A. Probably, yes.

Q. Why is that?

A. I suppose because of the image of it.

Q. And the image is?

A. Slightly more unusual."

35. There were a number of other pieces of evidence much along the same lines. A considerable number of members of the public seemed to think that Swiss chocolate was different to and more up-market than other types of chocolate but the precise reason for feeling that and the respects in which Swiss chocolate was thought to differ from other chocolates varied from witness to witness. On this issue, as on all others where evidence from members of the public is concerned, both parties agreed that it was impossible from the comparatively small number of witnesses called to come to any quantitative conclusion on what the public's view is. They give the court a flavour of the diversity of opinions held and some feel for why certain opinions are held.

(ii) Trade witnesses

36. The most important retailer called was Ms Kirkbride. She is a "Product Selector" for Marks and Spencer plc . She is involved in selecting and developing chocolate products for sale in Marks & Spencer's retail outlets throughout the United Kingdom. She has worked at Marks & Spencer since April 1994 and has been employed as a product selector since that time. One of the lines she has been involved in developing and of which she is currently in charge is Marks & Spencer's line of Swiss chocolate products. Her evidence was that Marks & Spencer's Swiss chocolate has been very successful and is one of that company's core products. Her employer sells in excess of 100,000 items of Swiss chocolate per week. Marks and Spencer have stocked a Swiss chocolate mountain bar for ten years, an extra fine Swiss chocolate bar for three years and a big Swiss chocolate tablets bar for five years. It also stocks some seasonal products such as Swiss chocolate champagne truffles at Christmas and Swiss chocolate valentine hearts for Valentines Day. The wrappers for the Extra Fine and Milk chocolate are reproduced at Annex II to this judgment. This chocolate is made in Switzerland. In this respect Marks and Spencer is in competition with other major retailers. For example Waitrose Plc also sell a bar of chocolate under the name "Swiss White Chocolate" and Boots also sells "Swiss Milk chocolate". The wrappers for the former is reproduced in Annex III. These products also are made in Switzerland.
37. Miss Kirkbride said that Swiss chocolate was sold because it provided a "point of difference" over standard milk chocolates. She also said that the Marks and Spencer Swiss chocolate was perceived by Marks and Spencer to have a reputation amongst the public as a premium product and the fact of its Swiss origin was "a unique selling point." She said:

"Each of our Swiss chocolate wrappers bears the description "Swiss chocolate". We make sure that the word "Swiss" is emphasized on the label. This is very important in establishing the point of difference of the products and capitalising on the reputation of Swiss chocolate. Not only do we refer to it as St. Michael's Swiss Milk chocolate we also have a separate brand used on all our Swiss chocolates which shows the word "Swiss" on a mountain background in a oval logo."

38. Although Ms. Kirkbride was cross-examined as to the price differential between Marks and Spencer Swiss chocolate and other non-Swiss chocolates sold by that company, none of this evidence quoted above was challenged.
39. Evidence also was given by Cadbury's marketing director, Mr. Palmer. The following passage comes from the transcript of his cross-examination:

"Q. Would I be right in saying this, that over the years you have come to appreciate that members of the public do recognize Swiss chocolate as being something?

A. I think they recognize Swiss brands as being something. I am not sure that they would be able to describe explicitly what Swiss chocolate per se was.

Q. Their reaction is going to be something like, "It is high quality."

A. I think the words used in this stand today and were sometimes creamy. People talk about smooth. People talk about creamy. People use a number of, I would say, fairly bland adjectives to describe chocolate from the continent.

Q. We were talking about Swiss chocolate. Was your answer directed to Swiss chocolate or continental?

A. It was directed to Swiss, but I think in the context of which a number of other continental chocolates would probably be in the same bracket.

Q. So you are accepting that some members of the public, in your experience, have a perception as to a type of quality that they are going to get from a product called Swiss chocolate.

A. Yes, I think that is probably true."

40. Further, during the cross-examination of Mr. Porterfield, the Area Manager for the duty free division of Suchard, Mr. Michael Bloch suggested to him that in the 1970's at least, Swiss chocolate had a "certain cachet". Mr. Porterfield agreed. It was not suggested that the cachet had diminished with the passage of time.
41. Bearing in mind all the evidence, I have come to the conclusion that the words "Swiss chocolate" have acquired in England a distinct reputation. Although it refers to chocolate which emanates from Switzerland, the plaintiffs have proved that to a significant part of the public here those words denote a group of products of distinctive reputation. Further, the actions of major retailers like Marks and Spencer reinforce that conclusion. They are experts in assessing and catering to the wishes of the public. I accept Ms Kirkbride's evidence as indicating Marks and Spencer's view that the words "Swiss chocolate" had a reputation for quality among a significant part of the public. The fact that members of that public have different views of what the features of the distinctive quality are or are incapable of defining it, is of little relevance.
42. However, even if the words have acquired a reputation, it is necessary to identify what group of products are entitled to use it. Both parties accepted that, in accordance with the speech of Lord Diplock in Advocaat, the plaintiffs needed to identify the class or group with reasonable precision. On this issue the parties were far apart. Cadbury suggested that the words "Swiss chocolate" could now be used on such a diffuse class of products from different places in the world, to different recipes and having different tastes that there really was no class at all. On the other hand the plaintiffs, understandably, were anxious to argue that the class was as narrow as possible, thereby excluding more of their competitors. To this end in the Statement of Claim the plaintiffs said that :

"6. For the purposes of this action the Plaintiffs will rely upon the following factors as identifying Swiss Chocolate:

(a) It is made in Switzerland;

(b) It has at least 25% cocoa solid content for milk and plain chocolate, as is required by Swiss and EC law (Article 333 of the Swiss Food Law Ordinance (Ordonnance sur les denrees alimentaires, ODAl du 1 mars 1995) and Paragraph 1.21. of Annex I of EC Directive 73/241/EEC)

(c) It contains no vegetable fat other than cocoa fat; and

(d) It has a smooth texture due to the fact that there is a high percentage of fat and a small chocolate particle size."

43. They said that this defined the class of products to which the words Swiss chocolate could be properly applied. Cadbury, beside disputing the classification, also said that it was so nebulous as to be meaningless. It asked for further and better particulars of feature (d) but did not receive any before the trial. However during the course of the trial Mr. Thorley asked for and obtained leave to amend the statement of claim to add the following after (d):

"Neither the particle size nor the ratio of fat to particle size is defined in any regulation. Further there is no universally accepted method of defining particle size. For the purposes of this litigation, reliance is placed upon the 84th percentile Malvern Mastersizer laser diffraction method (including where necessary a correction factor) as described by Alan Sidaway. The Swiss Chocolate Manufacturers (as defined above [in the statement of claim]) combine a fat percentage of over about 30% with a particle size (84th percentile as above) of under about 20 microns in producing the said smooth texture of Swiss chocolate."

44. This combined definition of the class creates great difficulty. First it is quite clear on the evidence that a number of manufacturers of chocolate in Switzerland, some of whom are members of Chocosuisse, sell products under the name "Swiss chocolate" which do not meet the definition. There was a dispute as to whether this applied only to three of the sixteen manufacturers, as the plaintiffs concede, or to six of them as Cadbury suggests. It seems to me that Cadbury are right on this issue, but it does not matter which figure is correct. Since Lindt is acting for itself and in a representative capacity for and on behalf of "all other persons who manufacture chocolate in Switzerland and export such chocolate to the United Kingdom", I do not see how it can advance a definition of the class which would deprive some of those of whose behalf it acts of the cause of action. In any event, the whole definition appears to me to be fraught with difficulties. For example the particle size is defined by reference to a figure obtained by using the 84th percentile Malvern Mastersizer laser diffraction method. That is not a method which is used by anyone, apparently, other than Cadbury. Furthermore it was clear from the evidence given to me that it is quite impossible to define the quality of chocolate by reference to the figures set out by the plaintiffs in their definition. Although it may be that a majority of Swiss chocolate manufacturers happen to make chocolate sold under the Swiss chocolate designation which fall within the plaintiff's definition, this appears to be little more than a coincidence.
45. Further the plaintiffs say that all Swiss chocolate contains no vegetable fat other than cocoa fat. However the expert evidence shows that under current Swiss regulations manufacturers are allowed to use up to 5% vegetable fat and that if a good vegetable fat is used, such as CBE (Cocoa Butter Equivalent), not even an expert taster could distinguish it from chocolate made without that ingredient. I was unclear whether Mr. Thorley was taking the position that a Swiss manufacturer who makes chocolate containing CBE in accordance with Swiss regulations was entitled to call his product Swiss chocolate here, as he would be entitled to do in Switzerland.
46. In any event, I think that the approach adopted by the plaintiffs in an attempt to narrow down the class of persons who are entitled to rely on the reputation of the designation is faulty. When a designation has a clear meaning in accordance with common usage of the English language it is reasonable to start from the position that the persons and products which can take the benefit of that designation are all those who comply or are made in accordance with that meaning. Prima facie, Swiss chocolate means chocolate made in Switzerland. Of course the circumstances of the trade may show that the class has to be more narrowly defined than that. Champagne could have been a term used to refer to any wine, whatever its colour and whether sparkling or not, made in the eponymous area of France. As it happens it has been used exclusively to designate a particular type of wine from that area with the result that the reputation in that name is now restricted to that type of wine. The same applies to Scotch whisky.
47. The term "Swiss chocolate" is the designation which has been used, save for very minor exceptions, only on chocolate made in Switzerland in accordance with Swiss food regulations. Subject to the restrictions imposed by those regulations, those chocolates have been made to very different recipes. They taste different from each other and are no doubt of different qualities inter se. Notwithstanding these differences, together they have acquired a reputation for quality. If tomorrow many of those manufacturers were to decide to make lower quality chocolates containing some CBE, they would be free to do so. In the fullness of time this might impact adversely on the cachet which attaches to the designation "Swiss chocolate". However if they continue to meet Swiss food regulations, they will no doubt continue to be entitled to call their products Swiss chocolate at home. I can see no reason for defining the class of products entitled to bear that designation any more narrowly than chocolate made in Switzerland in accordance with Swiss food regulations.
48. As I have mentioned, Cadbury argued that there is no class of goods which can be identified with reasonable precision. It points to the fact that some members of the public who believe that the Swiss chocolate is a product with a connotation of quality, do not think that it comes from Switzerland. I have quoted above some witnesses who appeared to have that view. Further it says that quite a few people thought that chocolate which did not come from Switzerland did in fact come from there. For example some Lindt chocolate is made in France. It is not marked with the words Swiss chocolate. Nevertheless quite a few members of the public seem to have assumed it was Swiss chocolate. However these facts do not alter my view as to the identity of the class of goods entitled to use and exploit the reputation built up by the designation Swiss chocolate. The fact that public have no clear idea of the characteristics of the goods which have the reputation is of little consequence. In the case of Champagne, no doubt many members of the public who know of and rely on the reputation acquired by that designation, know nothing about double fermentation and do not know where the Champagne district of France is. Some may not even know that the wine with the reputation comes from France. This is irrelevant. What is required is to identify the class of goods which has built up and is entitled to exploit the goodwill, not whether the public appreciates the identifying characteristics of the class. Similarly the fact that some brand names, like Lindt, are so strong that members of the public treat them as if they were a statement of Swiss origin does not alter the fact that, save for very minor exceptions, the words "Swiss chocolate" have been used only on chocolate made in Switzerland, presumably in accordance with Swiss food regulations. It follows that I reject this criticism of the plaintiffs' case.
49. Since it is not in dispute that Cadbury's product is made in England, in fact from standard Dairy Milk chocolate, it does not fall within the class which can be called Swiss chocolate. As Mr. Palmer accepted, it is a product which has no natural association with products sold under the designation Swiss chocolate and it is not made in accordance with anything which might be thought of as a Swiss recipe.

Has there been or is there likely to be relevant confusion?

50. The question now to be answered is whether the use of the words "Swiss Chalet" by Cadbury on its product has led or is likely to lead members of the public to believe that it is a Swiss chocolate. That is to say, have the plaintiffs proved that those members of the public for whom the words "Swiss chocolate" have a reputation will be confused into believing that this product is one of the group of products which can be legitimately bear that designation. What the court is trying to do is decide how members of the relevant public will react to the defendant's use of these words in the real world. In many cases the circumstances in which the marks or get up are put before the public and the way in which it reacts to them will be far removed from what happens in court. This is particularly relevant to this dispute. The case was conducted by lawyers and before a court with experience of trade mark and passing off disputes and, as a consequence, perhaps a heightened awareness of the possible value of trade marks and the differences between different marks and packaging. But the detailed analysis of the Cadbury product at the trial has little relationship to what would happen in the environment where it is being sold. Swiss Chalet is a comparatively low cost item. In many cases it is likely to be purchased without prolonged examination of its packaging. Even if the packaging is examined it does not state where the product is made. Furthermore I think I must guard against assuming that my personal view is one that would be shared even by a substantial minority of the public at large. I first saw the Cadbury product knowing that it was the subject of passing off proceedings and I examined it carefully. I think it is unlikely that I would have taken it to be Swiss chocolate but it is now difficult to assess what my reaction would have been had I not come across it knowing that it was the subject of a passing off dispute but had seen it only on a supermarket shelf. Similarly I must not pay regard to the views of those who could be categorised, in Foster J.'s words, as morons in a hurry.
51. Secondly, on a number of occasions the courts have said that on the issue of deception of the public the intentions of the defendant are irrelevant, save where there is a deliberate intention to deceive. In this case Mr. Palmer accepted that the name "Swiss Chalet" and the get up used on the Cadbury product were evocative of Switzerland while Ms Caroline Cater, who was the product manager responsible for the launch of the product, agreed that the image that Cadbury was seeking to create from its wrapper, was something which emphasized, by one means or another, a Swiss connotation and that this fitted with the Swiss Chalet brand name. Since, as noted above, Mr. Palmer accepted that there was no natural association between Swiss Chalet and Swiss chocolate, these were pieces of evidence on which Mr. Thorley relied. However they really afford little support to the plaintiffs' case. Whatever Cadbury's intention or expectation may have been, what counts is the effect achieved or likely to be achieved with members of the public.
52. Thirdly, if there is any relevant confusion, I must assess whether it is sufficiently extensive. On this issue the law is set out in the judgment of Morritt LJ in Neutrogena Corp. v. Golden Ltd. [1996] RPC 473. I must have regard to whether the plaintiff has proved the likelihood of confusion among a substantial number of the public. It appears to me that this ties in which the question of damage. If the confusion is extensive enough to inflict substantial damage on the plaintiff's reputation then it is extensive enough to support the plaintiffs' claim.
53. In this case a number of members of the public were called to give evidence and there was also evidence of the results of certain small surveys. The latter appear to have been carried out primarily as witness collection exercises. As mentioned above, the parties agreed that the witnesses called can only give me a flavour of the spread of reactions which can be expected among the large number of individuals who make up the English public. The same goes for the surveys. None were suggested to be statistically reliable. Further, as with all survey evidence, each side to a greater or lesser extent criticised the methodology adopted by its opponent.
54. It is clear that many people will not be confused by the use of the words "Swiss Chalet" into believing that Cadbury's product is the Swiss chocolate of repute. For some this is because the words "Swiss Chalet" would not be taken to be the same as "Swiss chocolate" and for many, the impact of "Swiss Chalet" was submerged by the use of the powerful "Cadbury" name and the association that the latter had with Bournville in England. For people who made that association and for whom the words "Swiss chocolate" meant a product of high reputation from Switzerland, the domestic significance of the Cadbury name would prevent confusion. However, as indicated below, there was evidence that at least some members of the public appeared to think that Swiss Chalet was Swiss chocolate.
55. The plaintiffs carried out surveys as follows. A number of market researchers asked members of the public to identify which of a number of products, listed on a card, they bought. Those who indicated that they bought chocolate then were asked to go into a hall or room in which there was a display stand which reproduced an in-store confectionery display. In fact it replicated the display which was to be found in a shop known as Photogenie in Leather Lane, London. The display consisted of a triple shelf unit. On the top shelf were boxes of chocolate. On the middle there were a variety of bars of chocolate. On the bottom shelf there were chocolate enrobed products such as "Kit Kat", "Mars" and "Toblerone". The products on display were made by a variety of manufacturers. The middle shelf contained numerous Lindt products, including some made in Switzerland, products known as "Galaxy", and the following Cadbury products:

Cadbury 1848

Cadbury Swiss Chalet

Cadbury Dairy Milk

Cadbury Bournville

Cadbury Dream Double Fudge

Cadbury Whole Nut

Cadbury Old Jamaica

Cadbury Golden Crisp

Cadbury Black Forest

Cadbury Roast Almond

Cadbury Turkish

Cadbury Grand Seville

Cadbury Cappuccino

Cadbury Fruit and Nut

56. Each of the products on display carried the usual little price sticker. The members of the public were asked to choose "the cheapest Swiss chocolate product" that he or she could see. Some chose Swiss Chalet. Some of these then gave witness statements and most of those were then cross examined. Examples of some of the evidence given by these witnesses is as follows:

(i) Mr. Paul Bird picked Swiss Chalet. In his witness statement he was asked why he thought it was Swiss and answered "it says on the label "Swiss Chalet" so I presumed it was Swiss". Under cross examination he said that he liked and bought Swiss chocolate. He also gave evidence that he had consumed quite a few Cadbury products. He was asked whether he associated Cadbury's with any particular country. He said he did not. His reasons for picking Swiss Chalet were not tested by cross examination.

(ii) Mr. P. Newbey picked Swiss Chalet and in his witness statement he said that when he was asked why he thought the item he had chosen was a Swiss chocolate product he answered "because the name and the design on their showed a Swiss scene with a chalet of some description.". Under cross examination he was asked whether, when buying a bar of chocolate, he paid particular attention to the country from which it came. He said that "in general" he did not but on occasion he did. He also said that he associated Cadbury with this country. He was not cross examined in relation to his reasons for having selected Swiss Chalet.

(iii) Mr. Tony Croker's witness statement included the following:

"The legal representative then asked me why I thought that the item I chose was a Swiss chocolate product. I answered that the bottom row were all Cadbury except for one which I think was German. I had to choose the cheapest and the top row were all expensive boxes of chocolate. One bar in the next row had Swiss written on it and they were all about 84p so I chose it. I thought it was a Swiss chocolate product because it had "Swiss" on it."

57. Under cross examination he said that he did not recall seeing the Cadbury trade mark on the product and it was put to him that the price sticker might have been placed over it. In fact the actual bars of chocolate used in the survey were available in court. On none of them did the sticker cover or obliterate the Cadbury mark to any appreciable extent. Mr. Crocker said that he ate Swiss chocolate but only occasionally because it is generally more expensive. He said that he would not normally go into a shop to look for the cheapest Swiss chocolate. He was asked to pick up a bar of Cadbury chocolate and the legend "Cadbury's Limited, Bournville, Birmingham" was read to him. He was then asked whether he considered that most Cadbury's chocolate products are made in any particular country. Notwithstanding the fact that Counsel had just read out Cadbury's address, his response was

"I have not really given it much thought, but I would assume most of them are made in England."

58. He went on to say that he does not give much thought to the country of origin of chocolate.

(iv) Mr. Christopher Harrison explained in his witness statement that the reason he chose Swiss Chalet was because it said "Swiss" on the wrapper and had pictures of mountains on it. His cross examination was short. He said that he liked Swiss chocolates and also ate Cadbury chocolates. He also said that price was a factor which he took into account when purchasing. The final part of his cross examination was as follows:

"Q. In the ordinary way, if you went into a shop looking to buy bar of chocolate, you would not have in mind, in particular, would you, where it came from?

A. No."

59. He was not cross examined about his reasons for concluding that Swiss Chalet was a Swiss chocolate.

(v) Mrs. Jane Bates said in her witness statement that she chose the Swiss Chalet product as a Swiss chocolate because it had "Swiss" written on it and for no other reason. Under cross examination she said that she knew of various Swiss chocolates, Toblerone particularly coming to mind, but also that she would not buy Swiss chocolate and did not think about what was Swiss chocolate in any great depth.

(vi) Mr. David Carpenter appeared to be alert to the possible difference between Swiss chocolate and chocolate made by a Swiss company. He had selected Swiss Chalet and when asked why he thought that it was a Swiss chocolate product he said:

"... because it had "Swiss" on it and I was asked to pick a Swiss chocolate product, not a product made by a Swiss company, there was other chocolate there made by Nestle."

60. As mentioned above, he was one of the witnesses who thought Swiss chocolate had a reputation as being "the best of the quality of the chocolate range". Under cross examination he said that he was familiar with the Cadbury name, the glass and a half symbol and the familiar purple background used by Cadbury. He accepted that if "in the ordinary way" he had gone into a shop looking for a bar of chocolate and had seen Swiss Chalet in the Cadbury's chocolate range it was quite possible that he would not have given any thought to where it was made.

(vi) Miss Rosina Kazimierczak said that she picked Swiss Chalet as Swiss chocolate "because it said it on it". However under cross examination she said that she did not purchase Swiss chocolate. She said that had she been intending to buy a new chocolate she would have read what was on the back of the label but she did not do so here.

61. In addition to evidence like this directed to individual witnesses obtained by the plaintiffs' survey, the overall survey results, including all the reported responses, were analysed and, for Cadbury, criticised by Mr. Barter who had extensive experience of the survey research industry. He was until very recently a senior executive of National Opinion Polls Limited. He criticised the way that the surveys were carried out, although some of his criticisms were withdrawn when he had further information as to how the surveys had been designed and executed. His major criticisms, so it appeared to me, were stated by him to be that (i) there was no information as to what respondents understood "Swiss chocolate" to be, (ii) the question introduces the double concept of "Swiss chocolate" and cheapness which may have confused respondents and (iii) the bias introduced by the question and the visual prompt was such that no statistical conclusions could be reached as to what people understand by "Swiss chocolate" and to what proportion (if any) of the chocolate purchasing public believe Swiss Chalet to be a "Swiss chocolate product". The second and third of these criticisms were explained particularly in paragraphs 15, 22 and 23 of his report.
62. These criticism must be taken into account in assessing the overall value of these surveys. It is perhaps a pity that the second one was not put to most of the witnesses who were cross examined. Furthermore Mr. Barter did not suggest that his criticisms explained all or even a majority of the answers on which the plaintiffs relied. His objection that the surveys did not allow one to come to statistical conclusions was not challenged. However his analysis of the surveys also threw up some interesting figures which are set out in exhibit JHB 2 to his report. It shows that out of the large range of products put on display for the survey, the most picked item was "Lindt Swiss Milk". There were numerous other Lindt products on display but nearly 20% of respondents picked this. The next most commonly selected product was Swiss Chalet which was picked up by over 16% of respondents. Furthermore the selection of Swiss Chalet from among the Cadbury's products was very pronounced. According to his figures, the numbers were as follows:

Product	Number of Respondents who selected
Cadbury 1848	0
Cadbury Swiss Chalet	63
Cadbury Dairy Milk	3
Cadbury Bournville	2
Cadbury Dream Double Fudge	2
Cadbury Whole Nut	1
Cadbury Old Jamaica	1
Cadbury Golden Crisp	1
Cadbury Black Forest	0
Cadbury Roast Almond	0
Cadbury Turkish	0
Cadbury Grand Seville	0
Cadbury Cappuccino	0
Cadbury Fruit and Nut	0

63. Mr. Barter told me that the most likely reason why respondents selected Swiss Chalet rather than any other Cadbury product was because it said "Swiss" on it.
64. In addition to this evidence, I had the benefit of certain surveys carried out by the defendant and the examination of a number of witnesses who were selected from among the respondents to those surveys. One of those surveys was conducted at a newsagent called Rosendale News. Its chocolate display did not include Cadbury's Swiss Chalet chocolate bars. On 9th May 1997 a witness gathering exercise was conducted outside Rosendale News. Before it started a row of Cadbury's Swiss Chalet chocolate bars was placed in the display. The display was cramped with a large number of products squeezed into a relatively small space. A photograph of the display is at Tab 19 of Bundle 7.2. Once the display had been set up, a researcher from NOP approached people in Rosendale Road and asked them a preliminary question about chocolate. They were then asked to go into Rosendale News to identify and place in a basket all the bars and boxes of Swiss chocolate on display. The researcher then recorded all the chocolate bars and boxes selected on a questionnaire. The NOP researcher handed the questionnaire to the person who had just undertaken the exercise and asked them to sign it to confirm that the answers recorded were accurate. The researcher then asked them if they would be willing to be interviewed. If they agreed, they were brought over to a member of the defendant's solicitors to be interviewed. They were handed a bar of Cadbury's Dairy Milk as a gift for having participated in the exercise. The solicitor then asked each interviewee if he could ask a few questions about the exercise they had just undertaken in the newsagents. He first asked all interviewees what "Swiss chocolate" meant to them. He then asked various questions about the products that had been selected during the exercise in the newsagents. The questions asked varied slightly from interviewee to interviewee depending on what had been selected and the answers they gave. The course that these conversations took is reflected in the witness statements produced.
65. In the course of this exercise, a number of people selected Swiss Chalet in response to the request to put all the bars and boxes of Swiss chocolate in the basket. Many did not. Examples of the evidence of some of these witness are set out below. The mark (N) after a name means that the witness was not required to attend for cross examination.

(i) Miss Calder (N) did not notice the Swiss Chalet bars but said she did not think it was Swiss chocolate because it was from Cadbury's.

(ii) Mr. R. Dalton (N) put Swiss Chalet in the basket. His witness statement includes the following:

"I picked a Cadburys Swiss Chalet bar during the selection exercise because I thought it was Swiss. I believed the label."

(iii) Ms. C Dunkley (N) said that she thought Swiss chocolate was expensive and a treat and usually came from Switzerland. However she did not put Swiss Chalet in the basket. She said:

"I did not pick the Swiss Chalet Cadburys bar during the exercise in the shop because of where it came from i.e. it is Cadburys. I did not think it was Swiss chocolate. ... I told [the interviewer] that I did not think Swiss Chalet was Swiss for a minute."

(iv) Mrs. Madeleine Flinders (N), from whose witness statement I have already quoted above, did not put the Swiss Chalet product in the basket. She said:

"I was shown a bar of Swiss Chalet which I had not seen during the selection process in the shop. I thought it was a poor imitation of Swiss chocolate and that it was probably made here."

(v) Mr. Shaun Hooper (N) did not put Swiss Chalet in the basket. He said:

[The solicitor] asked what Swiss chocolate meant to me. I said it is supposedly made in Switzerland and it is usually rich, dark chocolate. I was then shown a bar of Cadburys Swiss Chalet. I did not pick this during the selection exercise in the shop but I would have done if I'd seen it."

(vi) Ms. Linda O'Connor (N) from whose witness statement I have already quoted did not put Swiss Chalet in the basket. She said the did not think it was Swiss chocolate because it came from Cadbury.

66. One of the points which came out of this exercise was that a large number of interviewees associated Cadbury with Bournville. This was the subject of comment by Mr. Thorley. One of the defendant's surveys, although not the Rosendale one, was carried out in Birmingham. Of course Cadbury is a significant employer in Bournville which is in Birmingham. It is not clear why the defendant carried out this exercise in a location in which the defendant and the fact that it is English based is likely to be particularly well known. Mr. Barter was asked questions about this. He appeared to accept that carrying out a survey like this in Birmingham might well skew the results, depending on where precisely in Birmingham the survey was conducted. In any event he said that if he had been setting up that particular survey he would not have chosen to run it in Birmingham. He said he might have set it up in Wolverhampton but not near Bournville.
67. This gives one some flavour of the spread of evidence put before the court. I think it is clear that for many people, including some of those for whom the words Swiss chocolate mean a product of quality from Switzerland, the prominent use of the famous Cadbury name and get up will be enough to prevent them thinking that Swiss Chalet is a Swiss chocolate. Furthermore there are very many for whom the origin or connections of Swiss Chalet will be irrelevant. In addition to this, I think that in some cases it is likely that the questions asked in both the plaintiffs' and defendant's surveys may have resulted in the interviewees entering into an area of speculation which would not normally have crossed their minds. Many people, and particularly those who are more observant, would not be confused. For them the words "Swiss Chalet" will signify nothing but a pretty sounding name for a bar of chocolate. They will convey no other message. However I have come to the conclusion that there are some who will be struck by the largest and most prominent word on the defendant's packaging namely "Swiss" and think that it is a reference to an attribute of the product itself. I think it is likely that some will think that it is an indication that the product is Swiss chocolate. Some, like Mr. Crocker, may not see the reference to Cadbury. Others might not believe that all Cadbury chocolate is made in England. In fact it is not all made here. Cadbury like many other manufacturers has set up factories or formed alliances abroad. Further, for some the get up of the packaging with its typical Swiss scene will tend to reinforce the message of the word "Swiss". Finally some may be left in confusion as to whether Swiss Chalet is Swiss chocolate or not.
68. I have found this the most difficult issue in the case. However, I have come to the conclusion that a substantial number of members of the public who regard Swiss chocolate as the name for a group of products of repute will be confused into thinking that Swiss Chalet is a member of that group by reason of the use of the name Swiss Chalet. It is likely that the number who think that will be smaller than the number for whom there will be no confusion but, in my view, it is still likely to be a substantial number. It follows that on this issue the plaintiffs succeed.

Damage

69. The plaintiffs argued that if it succeeds up to this point, damage is more or less inevitable. In fact the defendant did not address any arguments to me directed specifically to this issue. In any event I think the plaintiffs are right. If there is likely to be confusion among a substantial part of the relevant public I think it must follow that the exclusivity of the designation Swiss chocolate must suffer and that will damage all the plaintiffs and those whom they represent. As the Master of the Rolls said in Elderflower Champagne, that damage will be insidious.

Unclean hands

70. A detailed and prolonged attack was launched by the defendant against the plaintiffs to the effect (i) that they had failed to take all reasonable steps to ensure that the words "Swiss chocolate" or "Swiss" in relation to chocolate continued to indicate to the public in England chocolate made in Switzerland and (ii) had mislead the public into believing that chocolate which was not made in Switzerland was made there. Before dealing with the second of these topics, it appears to me that the first of them, even if made out, would be of little relevance to this action. Even if Lindt, Suchard and Chocosuisse had failed to do everything which they could reasonably have done to secure the continued exclusive geographical connotation of the words "Swiss chocolate", it would be of no consequence if, notwithstanding their failings, the words do convey that connotation. Conversely, even if the plaintiffs had taken all reasonable steps to secure the exclusive connotation, in the end it would avail them nothing if, notwithstanding their endeavours, the words had lost that meaning to members of the public in England. What counts, for the purpose of this type of action is whether or not the words sued on have the protectable meaning on which the plaintiffs rely. If they do, it does not matter that that came about by accident, by virtue of prolonged efforts by the plaintiffs or in spite of poor husbandry by them. I have already found that such an exclusive connotation exists here.
71. The real argument concerned the alleged unclean hands of the plaintiffs in misleading the public as to the origin of various of their own products. Cadbury said that a plaintiff cannot succeed in passing off if his own use of the name, mark or indicia relied upon is inherently deceptive. In support of this it relied on Newman v. Pinto (1887) 4 RPC 508. On this issue the plaintiffs drew my attention to Ford v Foster (1871-1872 ) 7 Ch App 611, Advocaat at first instance (supra, at p50/₃₀ to p51/₁₀) and White Horse Distillers Ltd. v. Gregson Associates Ltd. [1984] RPC 61.
72. In Newman v. Pinto the plaintiff had marketed its cigars in boxes bearing a label which bore the arms of Spain and Havana and the words "La Pureza Habana Ramon Romnedo". That label was the subject of a registered trade mark. The boxes also carried a lock label which bore a signature of Ramon Romnedo. Mr. Romnedo did not exist and the plaintiff's products were not made in Havana. The defendant sold cigars in boxes with essentially the same label on and was sued for trade mark infringement. The Court of Appeal held that the plaintiff could not succeed because his labels were fraudulent. Cotton LJ said that the proper course is for a court of law, and much more a court of equity, to refuse to interfere to protect a trade which is assisted or supposed to be assisted by misrepresentations made by those who are seeking the assistance of the court. Bowen and Fry LLJ also said that the plaintiff should be refused relief but they expressed themselves more forcefully than Cotton LJ. They both said that the plaintiff's labels bore a concatenation of lies and that its business was fraudulent and it was for that reason that relief was refused.
73. In Ford v. Foster the plaintiff sold shirts under the name "Ford's Eureka Shirts". It sued the defendant for using "Eureka" on its products. The Court of Appeal had little difficulty in holding that a case of passing off had been made out. However the defendant argued that the plaintiff should obtain no relief because in its literature and on its invoices it had falsely claimed that it's Eureka shirts were protected by patent. It was not in dispute that the claims were false. Mellish LJ considered whether these facts would give rise to a defence to an action at law. He said:

"Then would it be a defence to that action at law that the Plaintiff has made false representations to the public that his article was patented when in fact it was not? If the false representation was in the trade mark itself, although I cannot find that that point has ever been decided or raised in a Court of Common Law, yet I am disposed to think, and indeed I have a pretty clear opinion, that if that question were raised it would be held that the fact of the trade mark itself containing a false representation to the public would be an answer at law to an action brought for a deceptive use of the trade mark by the Defendant. ... It appears to me that it would come within the rule Ex turpi causa non oritur actio; that if the trade mark contains a false representation calculated to deceive the public, a man cannot by using that, which is in itself a fraud, obtain - I do not say an exclusive right - but any right at all. ....But where the trade is, as in this case, a perfectly honest trade, and where the trade mark is, as in this case, a perfectly honest trade mark, I am clearly of opinion that there is no common law principle upon which it is possible to hold that the fact of the Plaintiff having been guilty of some collateral fraud would be an answer to an action. It would be impossible to plead at law as a justification for the Defendants' committing the fraud that the Plaintiff had committed a fraud on someone else."

74. He went on to say that the same applied to an action in equity. Mr. Thorley relies on this. He says that even if his clients had done anything which could be said to be misleading, it was collateral to the existence of the reputation in the designation "Swiss chocolate". Indeed, if this defence is as formulated by Cadbury, namely that it applies when the plaintiff's "own use of the name, mark or indicia relied upon is inherently deceptive", it is not made out here. Save for some trivial instances of the word "Swiss" being used on Lindt Easter Eggs some years ago when the shell was made of English chocolate although the contents were Swiss chocolates, no allegation of deceptive use by the plaintiffs of the mark in issue, Swiss chocolate, has been alleged or proved.
75. In the end I think Mr. Thorley was right in suggesting that the approach to this issue should mirror that taken by the Court of Appeal in Habib Bank Ltd. v. Habib Bank AG Zurich [1982] RPC 1 in relation to estoppel, namely a plaintiff should fail in the action only in those cases where the court concludes that, in all the circumstances, it is unconscionable for him to be given the relief he would otherwise be entitled to. I did not understand this approach to be inconsistent with Cadbury's defence^[2]. Where the plaintiff has engaged in misleading activities, the closeness of those activities to the right he is seeking to enforce by legal proceedings will be an important factor to be taken into consideration. Similarly the nature of the misleading activities must be relevant to this issue. If the plaintiff has engaged in a prolonged and extensive campaign to defraud the public the court is more likely to refuse him relief than would be the case when the misleading conduct is short in duration and small in compass. I find it difficult to believe that any court would refuse a plaintiff relief where his activities were unintentionally misleading.
76. In the defence Cadbury has pleaded a large number of actions by the plaintiffs which it says have deceived the public. The essential allegations appear to be as follows:

"Members of the First Plaintiff, including the Second and Third Plaintiffs, have used "Swiss", "Switzerland" and Alpine Illustrations in relation to products not manufactured in Switzerland and the Plaintiffs have permitted others to use the same in relation to products not manufactured in Switzerland."

"Members of the First Plaintiff, including the Second and Third Plaintiffs, and/or their branches, associated companies and licensees (as defined in the Chocosuisse Agreement) have promoted the fact that they are Swiss companies and have promoted the following marks as being Swiss: Suchard, Lindt, Nestlé, Toblerone and Milka ("the Swiss Names").

"By using the Swiss Names in relation to chocolate products, members of the First Plaintiff including the Second and Third Plaintiff have deceived members of the public in the United Kingdom into believing that such products were manufactured in Switzerland and/or have created doubt in the minds of members of the public in the United Kingdom as to whether or not such products were manufactured in Switzerland."

77. These are supported by lengthy particulars. On its face, it appears that Cadbury's pleading extends as far as complaining that the plaintiffs have not sought to stop third parties selling products under the names; Swiss rolls, Safeway Swiss Style muesli, Alpen Swiss recipe muesli, Cadbury's Swiss Gateau, Kraft Swiss Cheese and St Ives Swiss Formula Hair Repair Treatment. If that was what was intended by the pleading, it was not put to any witness nor was it suggested that any of the plaintiffs had any obligation to pursue these uses of the word Swiss. Nor was it argued that any of these uses had anything to do with the designation Swiss chocolate. Cadbury concentrated instead on activities of Lindt and Suchard. It is convenient to deal with these separately.

(a) Lindt's activities

78. There was no dispute before me that chocolates made by Lindt and sold under their house mark have obtained an enviable reputation for quality. As Mr. Tanner explained in the witness box, the market for Lindt chocolates has grown and the market has become international. As Lindt has grown, it has set up manufacturing centres in Germany and France, and possibly elsewhere. The company has ensured that all of its products, no matter where made, are to precisely the same composition and quality as those made in Switzerland. However the result of this diversification is that some Lindt chocolate is made in Switzerland while some is not. Cadbury says that in a number of ways Lindt has deceived the public. The particulars cover alleged activities not only in England but also in Romania, Sweden and other places abroad. Before me Cadbury rightly only relied on activities here. It says that Lindt (i) has, at some point in the past, supplied point of sale stands on which the words "Lindt Swiss chocolates" appear and that these had been used, in at least one shop, to carry Lindt chocolate products not made in Switzerland, (ii) used the words "Lindt of Switzerland" on other display stands on which non-Swiss chocolate was stacked in shops, (iii) had used expressions such as "Lindt Excellence Milk Chocolate is manufactured to a new recipe, specially created in Switzerland. ... its subtle milky flavour reflects the knowledge and experience of Lindt's Swiss master chocolate makers". There was little evidence as to the extent of these activities nor was it suggested that Lindt had encouraged the first of them. This part of the case centered on a detailed cross examination of Mr. Tanner concerning Lindt's labelling policies. It was clear that Lindt ensure that they use the expression Swiss chocolate only on products made in Switzerland. This is illustrated by the two wrappers reproduced in Annex IV to this judgment. These are two versions of the Lindt Excellence product. One is made in France. It is so marked on the back of the label. The other is made in Switzerland. It is marked with the words "Swiss plain chocolate" on its front. This policy is carried through, so I understand, to all Lindt products. In other words Lindt does nothing to compromise the meaning of the words, Swiss chocolate. It is also clear that they are proud of their Swiss origins and are willing to tell the public that they are chocolatiers whose history goes back over a century and a half and that their origins are in Switzerland. In my view there is nothing improper or deliberately deceptive in this.
79. However Cadbury's major point was that the word Lindt was well known as the trade mark of a Swiss chocolate maker and that the use of that mark on products which did not come from Switzerland was therefore confusing. Cadbury's position was made clear in the following question put to Mr. Tanner:

"If you actually wanted to avoid confusion, you would use a different brand name, would you not? Why use the same brand name for Swiss chocolate as you use for non-Swiss chocolate?"

80. The evidence shows that some members of the public regard any product marked "Lindt" to be Swiss chocolate. It follows that they may regard the French produced Lindt Excellence bar to be Swiss. That is a result of the reputation that Lindt has built up over the years and the fact that its Swiss connections are well known. But the fact that some members of the public may have wrongly concluded that all Lindt chocolate comes from Switzerland does not mean that it is unconscionable for Lindt to sue to protect the designation Swiss chocolate. There is nothing improper in Lindt not having adopted the course suggested to Mr. Tanner that it should change its trade mark for non-Swiss chocolate products. The defendant failed to show that Lindt had embarked on a campaign of misleading the public. On the contrary, the overall effect of the evidence of Mr. Tanner, which I accept, was that Lindt has been and continues to be anxious not to mislead any potential customer and to maintain the integrity of the designation, Swiss chocolate.
81. I have come to the conclusion that it would not be unconscionable for Lindt to obtain relief in this action.

(b) Suchard's activities

82. If anything, the allegations made against Suchard are even weaker than those made against Lindt. The criticisms centered on two products; the well known Toblerone bar and a milk chocolate bar sold under the name "Milka". As far as the former is concerned, it was originally made in Switzerland, manufacture was switched to England in the 1970s and 1980s and was switched back to Switzerland at the end of the 1980s. When made in Switzerland, the product bears upon it, sometimes in large letters, the words "Swiss" or "Swiss chocolate". When it was made in England, these words were removed and an English address was put on the label. Once again it is likely that during the period during which Toblerone was made in England, some years before the commencement of these proceedings, some members of the public assumed that it was still made in Switzerland. However Suchard's labelling policy, like Lindt's, has always been consistent with ensuring that the words Swiss chocolate retained their accurate geographical connection and maintain their reputation. There was nothing improper or blameworthy in Suchard's behaviour in this respect.
83. Cadbury's case as far as Milka is concerned is weaker still. Milka is a product which used to be made in Switzerland. For quite a long time now, the stocks of Milka available to the English market have come from Suchard's factory in Germany. Milka bars available in this country are sold in the packaging the front of which is reproduced in Annex V. There is no reference to Switzerland or even to Suchard on it. The rear of the packaging states in large letters that the product is made in Germany. Notwithstanding that, it appears from the evidence that a small number of members of the public may still think that Milka is made in Switzerland. It was suggested that the use of a purple cow, pictures of snow-capped mountains and the word "Alpine" added up to blameworthy actions by Suchard which were likely to mislead the public into thinking this was Swiss chocolate. In my view it was nothing of the sort. There is nothing in the Milka packaging which points obviously to Switzerland rather than any other country with an Alpine area. Furthermore, even if, contrary to my view, there is something underhand about it, any defects in this packaging are far removed from the question of whether the designation, Swiss chocolate, should be protected.
84. I have come to the conclusion that there is nothing which Suchard has done in relation to its Milka product which could disentitle it to relief in these proceedings.
85. It follows that the defence of unclean hands does not succeed on this evidence. However there is another matter which leads me to the same conclusion. The defence of unclean hands amounts to a finding that the personal behaviour of the plaintiff disentitles him to relief. I am not persuaded that any such defence would have protected the defendant in this action even if the allegations in the defence had been made out. Here the plaintiffs act for themselves and on behalf of all other persons who manufacture chocolate in Switzerland and export it to the United Kingdom. The representative nature of these proceedings has not been challenged. All those other represented persons are as bound by the outcome of these proceedings as if they had been present and taken part in the proceedings themselves. Since the relief, and particularly the injunctive relief, is sought to protect their common interest in the designation Swiss chocolate, it seems to me that the defence of unclean hands could only succeed if had been proved that all or substantially all of the persons sharing that common interest have behaved unconscionably. Mr. Michael Bloch suggested that all the represented persons were equally responsible for the alleged deceptive activities of Lindt and Suchard because they were represented by Chocosuisse and it was the latter organisation's responsibility on their behalves to ensure that Lindt and Suchard did not do anything misleading.
86. This argument fails on the facts. Chocosuisse is not the representative of all those represented in this action. Only 13 of 16 manufacturers are members of the association. Furthermore it was not suggested that all the other represented parties knew of all or any of Lindt's and Suchard's activities of which complaint is made. For example it was not suggested that any other represented party did know or should have known that Kennedys Garden Centre in Waddon Way, Purley Way, Croydon had put non-Swiss Lindt chocolate on a display stand marked "Lindt Swiss Chocolate". There is no reasonable basis upon which any of them could have been held responsible for any of the Lindt or Suchard activities complained of and, by the same token, it could not be said that it would be unconscionable to grant them relief.

Locus of Chocosuisse to sue

87. The ability of Lindt and Suchard to sue in a representative capacity was not disputed. However there was a formal challenge to Chocosuisse's right to sue. The position adopted before me was that on the basis of Consorzio Del Prosciutto Di Parma v. Marks & Spencer Plc [1991] RPC 351, (the Parma Ham case) Chocosuisse could bring proceedings on its own behalf in passing off to prevent the reduction of its membership which might be caused if the designation Swiss chocolate became unprotectable in England. That authority also decides that a party in Chocosuisse's position could not sue in a representative capacity. The plaintiffs were content to accept Parma Ham for the purpose of the proceedings before me. However they reserved the right to argue in a higher court that Chocosuisse did have the right to sue in a representative capacity. Cadbury did not address any argument to me on these points. In the circumstances I shall follow the approach adopted in Parma Ham and find that Chocosuisse has the locus standi to sue on its own behalf only in these proceedings.
88. For the reasons set out above, I find for the plaintiffs in this action.

Postscript:

89. The Annexes to this judgment consist of reproductions of the packaging of various chocolate products. The limitations of colour printing means that these reproductions are not always very true to the original. In particular Annex I does not accurately reproduce the deep purple colour of the background behind the words "Swiss Chalet".

ANNEXES

ANNEX I

Cadbury's Swiss Chalet Packaging:



ANNEX II

Marks & Spencer Swiss Chocolate:





ANNEX III

Waitrose Swiss White Chocolate:



ANNEX IV

Lindt Excellence Packaging:

(a) Swiss made chocolate.



(b) non-Swiss chocolate



ANNEX V

Suchard Milka Chocolate:

Note 1   In a witness statement which was the subject of a Civil Evidence Act Notice.     [Back]

Note 2   See Defence para. 212.    [Back]