PRIOR USE AS A GROUND OF OPPOSITION IN BRITISH TRADE MARK LAW

Wednesday, April 11, 2007
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PRIOR USE AS A GROUND OF OPPOSITION IN BRITISH TRADE MARK LAWBy Wim Alberts
Section 5(4)(a) of the 1994 Trade Marks Act determines that a trade mark application can be opposed if, or to the extent that, its use in the United Kingdom can be prevented by virtue of any rule of law, in particular the law of passing-off. This section implements the optional provisions of article 4(4)(b) of the Directive. It is clear that this section differs from section 11 of the 1938 Act, in that it does require an opponent to make out a passing off case. The requirements for this remedy would thus, seemingly, be relevant. Various aspects of section 5(4)(a) were considered in recent cases, and these are discussed below.
What is of interest, firstly, is the scope of the comparison that must be made to establish a likelihood of confusion between marks. Is it the mark as used, or as filed, that must be considered? In Wild Child Trade Mark the appointed person, Mr Geoffrey Hobbs QC, stated the test to be applied in relation to an opposition in terms of section 5(4)(a) as follows:

"The question raised by the grounds of opposition is whether normal and fair use of the designation WILD CHILD for the purpose of distinguishing the goods of interest to the applicant from those of other undertakings … was liable to be prevented at the date of application for registration … by enforcement of rights which the opponent could then have asserted against the application in accordance with the law of passing-off."
The correct approach, also according to Kerly, is to consider a normal and fair use of the mark, and to gauge whether or not this would amount to passing off. Interestingly, however, he considers this test to be similar to that followed in terms of section 11 of the 1938 Act. Kerly also states the following, after referring to cases confirming said test to be the postulation of normal and fair use of the mark:

"In this sense the test is different from that involved in a claim for passing off which would normally require a consideration of all the circumstances of the defendant’s trade."
Kerly’s view thus seems to be that extraneous circumstances are not considered.
Kitchin and Mellor set out the position as follows:

"There is a further complication arising from the particular formulation of the prohibition. In considering the question of passing off the court must normally consider all the circumstances of the trade of the defendant to determine if deception is in fact occurring or likely. This analysis includes all distinguishing material. Under the prohibition, however, it seems that a notional and fair use of the mark the subject of the application will have to be considered."
The writers appear to accept that the circumstances of use would not be considered in terms of section 5(4)(a).
The test to be applied was also stated in Oasis Stores Ltd Application where A applied for registration of the trade mark Eveready for contraceptives and condoms. The application was opposed by B on the basis of its Ever Ready trade mark which was well known, inter alia, in relation to batteries. B relied, amongst other provisions, on section 5(4)(a). Reference was made to the leading cases of Erven Warnink B.V. v J. Townend & Sons (Hull) Ltd, and Reckitt and Colman Products Limited v Borden, as well as a statement on the legal position, being that it is relevant to consider the manner in which the defendant makes use of the mark and collateral factors. However, it was then stated:

"I accept that the comparison under section 5(4)(a) of the Act is between the applicant’s mark, as applied for, and the opponent’s mark as actually used."
It was thus accepted, in contrast to the position in terms of passing off, that the focus is on the applicant’s mark as filed.
The question whether the technical requirements of passing off are relevant was considered in the Corgi Trade Mark case. Here A obtained registration for the trade mark Corgi in relation to goods within class 25. B was the owner of the trade mark Corgi as used and registered in relation to model vehicles for many years. The appointed person, Mr Geoffrey Hobbs QC, stated that it is not correct for the purposes of section 5 of the Act to assimilate objections based on an "earlier trade mark" with objections based upon an "earlier right" protected by the law of passing-off. In an action for passing off the likelihood of misrepresentation and the prospect of damage to goodwill must be sufficiently real and substantial to warrant the intervention of the court. Section 5 adopts a different approach to the protection of "earlier trade marks." He then stated:

"Those provisions relating to earlier trade marks were plainly not drafted with a view to applying the technical requirements of a common law action for passing off to the protection of "earlier trade marks" under the Directive."
It is submitted that the view of the appointed person that the provisions relating to earlier trade marks were not drafted with a view to applying the technical requirements of a common law action for passing off, should also apply, mutatis mutandis, when section 5(4)(a), dealing with earlier rights, is considered. In other words, there is postulated a fair and normal use of the mark as applied for, and regard is not had to the actual manner of use, an issue that would typically be considered in a passing off scenario.
The issue of exactly what material should be compared was also considered in Saxon Trade Mark. Here former members of a band performing under the name Saxon obtained registration for Saxon. The application was filed after they left the group, and started their own groups, known amongst others as Graham Oliver’s Saxon. The remaining member of the band that continued to perform under the name Saxon, attacked the registration. In formulating the test to be applied, the court stated the following:

"As far as s.5(4) of the Act is concerned, the question to be asked is whether any normal use by the proprietors or either of them of the mark as registered for any of the goods or services in respect of which it is registered would be liable to be prevented by passing off proceedings brought by any other person. Since the mark as registered is SAXON, normal use would include use of that word alone by the proprietors in relation to records and live performances."
Later in the judgment, this view was re-iterated:

"What counts is whether Mr Dawson could be sued for passing off if he used SAXON alone, not whether Mr Byford could be sued."
It thus seems fair to say that it is the use of the mark as applied for that must be considered, in a notional sense, not the actual circumstances and manner of use, which would involve the consideration of extraneous matter. This should be the position although the latter forms part of normal passing off criteria.
The decision in Reef Trade Mark is seemingly in conflict with the above cases. Here A, the members of a pop group called Reef, applied for registration of the trade mark Reef in relation to goods within class 25 and class 26. B lodged an opposition on the basis of its earlier trade mark registration for Reef Brazil, as well as its common law rights created by the use of Reef Brazil.
In regard to the issue under discussion, the following was stated:

"Where the applicant’s mark is unused, this section presents a number of conceptual questions. Passing off is essentially a question of fact: does the defendant in fact make a false representation as to the origin of his goods by using the mark in suit? The first question is, when the mark is unused, what use is to be considered? The natural response is to say that all normal and fair uses of the mark in respect of all the goods in respect of which the mark is sought to be registered. This is capable of raising a number of factual difficulties which, unless kept within proper bounds, run the risk of turning every opposition in the Registry into a passing-off action with cross-examination and disclosure."
Following the "classical trinity" approach in relation to the elements of a passing-off action, being that a goodwill or reputation exists through public identification with the distinctive mark; that a misrepresentation was made, and that he suffers, or is likely to suffer, damage by reason of the erroneous belief engendered by the misrepresentation, the hearing officer found that B had a trading goodwill in relation to the goods concerned, and in particular, a reputation associated with Reef Brazil. It was assumed that Reef Brazil would be abbreviated to Reef, and that there was accordingly a reputation associated with Reef. This finding was accepted by the court. The court referred to a statement of the Hearing Officer, made in the course of coming to his decision that the opponent had not discharged the burden of proving passing off:

"If the relevant public – surfers – are also aware of the band REEF are they more or less likely to be confused as to the origin of the latter’s products? I think less likely. They would be able to make a distinction between T-shirts and the like merchandised by the rock band and sandals known as REEFS."
The court commented as follows on this approach:

"In my judgment, this short passage entirely overlooks the fact that while merchandising use of the goods to which the applicant’s mark is applied is the relevant use, the relevant representation is not necessarily that on the front of the T-shirt. It also overlooks the fact that at the date there had been no use of the applicant’s mark."
The court had evidence before it as to the manner in which the applicant’s mark would be used. It is thus accepted that it is difficult to exclude same from a consideration of the matter. However, it can be argued that the positioning of the mark amounts to a consideration of surrounding circumstances that has been held by the above cases and writers not to enter the picture. It must also be pointed out that if the process simply involves a consideration of the notional use of the mark, the fact that the mark has not been used would not have been problematical.
Strong support for a view contrary to what has been proposed thus far is found in Open Country Trade Mark. The court stated the following:

"The test laid down in Smith Hayden, adapted in accordance with the speech of Lord Upjohn in BALI, is the test applicable whether the applicant has or has not used his trade mark. However, no court would be astute to believe that the way that an applicant has used his trade mark was not a normal and fair way to use it, unless the applicant submitted that it was not. It does not follow that the way that the applicant has used his trade mark is the only normal and fair manner. However, in many cases actual use by an applicant can be used to make the comparison."
In C.A. Sheimer(M.) Sdn Bhd’S Trade Mark Application, it was also found, by the appointed person, Mr Geoffrey Hobbs Q.C., that the actual use of the applicant can be considered. It is submitted that the question should be answered through an analogy with the principles relating to infringement. If the focus in opposition proceedings is the mark, as filed, and it is submitted that it is, then the fact of the opponent moving from an own registration to prior user rights as a basis for the opposition, should not change the focus. The discussion of this aspect is thus concluded by having regard to the following statement of Kerly, made in an infringement context, which, it is submitted, nonetheless encapsulates the criterion to be utilised in terms of section 5(4)(a):

"The statutory protection is absolute in the sense that the user cannot escape by showing that by something outside the actual mark itself he has distinguished his goods or services…"
The second issue that requires consideration, is the scope of application of section 5(4)(a). In Oasis Stores Ltd Application it was held, insofar as the opposition of a mark used in relation to dissimilar goods is concerned, that it was not a requirement for success in passing off proceedings that the parties must be engaged in the same field of activity. It was stated, however:

"It appears to me that the burden of establishing an earlier right under section 5(4)(a) rests on the opponents. The fact that the parties are trading in different fields adds to the evidential burden on the opponents in showing that there is a real risk of confusion or deception. I also bear in mind that where the fields of activity are far removed as in this case, it cannot be assumed that even if a small amount of confusion did arise, it would necessarily result in damage to the opponents. In my view, the opponents have not made out their case under this heading. This ground of opposition consequently fails."
In Corgi Trade Mark dissimilar goods were also involved. In applying the various principles to the facts of the matter, the appointed person accepted that B was the proprietor of a substantial and valuable goodwill built up and acquired in connection with the promotion and sale of Corgi model vehicles over many years, and that it could be damaged in this regard if people were deceived or confused by the use of the trade mark in relation to clothing. It was, however, not necessarily clear that the use of the trade mark Corgi in relation to clothing would in fact be misleading. The appointed person held that it is possible that people would perceive or assume correctly that the same mark was being used by separate businesses trading independently of one another in the field of model vehicles and clothing. The opposition in terms of section 5(4)(a) was, therefore, rejected. However, the principle evident from these cases is that an opposition can take place even if the parties are active in different types of trading.
Thirdly, the issue of geographical priority must be considered. The concept of a national junior user having priority rights in a particular geographical area seems to find application in English law. Particular reference can be made to Saxon Trade Mark, where the following was stated in relation to section 5(4)(a):

"Mr Foley appears to have construed the section as if it is only concerned with cases where the use of the mark by the proprietor starts after the use of the same or a similar mark by someone else. I do not think that this is what the section says. For the prohibition to bite, all that needs to be shown is that, at the time of the application to register, the normal use of the mark by the proprietor would be liable to be prevented by passing off proceedings brought by someone else. It may well be that in most cases this will only arise when the other party had commenced using his mark before the proprietor, but it is not inevitably so and the section does not require it to be so. The fact that the convenient title "proprietor of an earlier mark" is used to designate the other party does not limit the scope of the section."
The court then gave the following example:

"Consider, for example, a case in which one proprietor uses a mark on a retail clothing business in Manchester and the other uses it on a similar business in Plymouth. They commence trading at the same time. Their trades do not compete because of geographical separation. Assume the Manchester trader registers the mark. Normal and fair use of it would include use in Plymouth. That would be liable to give rise to a cause of action in passing off…For that reason the Manchester trader would fall foul of s. 5(4)(a) even though the Plymouth trader commenced use of the mark at the same time. For that same reason the Plymouth trader could not register the mark."
It seems that the position is that where A has use prior to B’s application, he can oppose B’s application. Where a party does not have prior use (nationally) can it still, on the strength of the Saxon case, oppose another party’s application insofar as it relates to its area of use? For argument’s sake, B commences use, on a national scale, after A, but B has use prior to A in the area concerned. B can prevent use of the mark by A on the basis of passing off in the particular area, on A’s filing date, and, hence, oppose the application. This would recognize the principle of geographical priority.
Whether this approach is correct, is not clear. For one, it would be out of kilter with the approach adopted in section 11(3), although it is conceded that the wording of the sections differ. Section 11(3) also relates to the entitlement to relief on the basis of passing off, but it is linked to the earlier of the other party’s date of first use, or filing date. In other words, the fact that, in the above example, B commenced use after A could be seen as disqualifying him from opposing A’s mark.
Fourthly, the issue of the interaction of the terms "earlier trade mark" and "earlier right" must also be dealt with briefly. A distinction is made by Annand and Norman with reference to section 11 of the 1938 Act. The latter was said to be available to the user of a mark, whether or not it was registered. It is then said that, in contrast, section 5(4)(a) is only available to the owner of an unregistered mark. The better view is, of course, that it is also available to such a user, as there is no indication that the proprietor of a registered mark cannot rely on both user and registered rights.
Lastly, regard must be had to the relevance of disclaimers. In Torremar Trade Mark the court held that the pivotal issue in relation to the objection raised under section 5(4)(a) is whether, at the date of application for registration, normal and fair use of the contested mark in relation to the goods of interest to the applicant would have been likely to deceive or cause confusion by reason of its resemblance to any identified mark or labeling previously used by the opponent in the United Kingdom. The unregistered rights enjoyed by the opponent by that date were not necessarily co-extensive with the rights it had acquired by registration. Moreover, the existence of the disclaimers which limited the scope of its registered rights could not provide the applicant with a defence it would not otherwise have possessed in answer to a claim for passing off.
In summary, section 5(4)(a) introduces the concept of passing off into opposition proceedings based on the prior use of a mark. This is apparently in contrast with various decisions relating to section 11 of the 1938 Act. Nevertheless, some writers consider the test under the previous and current legislation to be similar. The test adopted in various decisions is based on the normal and fair use of the mark as applied for. In narrowing this down, it appears that although passing off requires a consideration of the manner in which a defendant uses a mark, including extraneous matter, the approach followed by most decisions is that it is the mark as applied for that must be considered. The principle of geographical priority seems to have been accepted. Reliance on a registration should not exclude an opposition on the basis of common law rights. Limitations on the registered rights of a mark are not relevant in section 5(4)(a) proceedings.