IP Bulletin - April 2013

TRADE MARKS

High Court allows evidence of witnesses to be adduced following guidance laid down for surveys

A recent decision in the Interflora and Marks & Spencer infringement proceedings saw the High Court ruling in favour of Interflora, allowing Interflora to adduce evidence of thirteen witnesses. The court followed the guidance laid down by the Court of Appeal even though the case did not involve a 'survey'. However, the Court of Appeal has overturned the ruling, saying that the judge applied too lax a test and should instead have asked himself whether the evidence was of real value.

Interflora Inc and another v Marks and Spencer plc and another [2013] EWHC 273 (Ch), 21 February 2013

Interflora Inc & another v Marks & Spencer plc [2013] EWCA Civ 319, 5 April 2013

Background

The claimant Interflora Inc ("Interflora") made an application to the court to adduce in evidence the witness statements of thirteen witnesses at a trial of the action scheduled for April 2013. Interflora did not accept that the court's permission was needed to adduce the evidence but, acting cautiously, made the application. The defendant, Marks & Spencer plc ("Marks & Spencer"), disagreed and said that permission was needed and should be refused.

There have been a number of recent judgments relating to the dispute between the parties. Interflora allege that Marks & Spencer infringed Interflora's UK and Community trade marks for the word INTERFLORA by ensuring that advertisements for Marks & Spencer's flowers were displayed when consumers search for "interflora" (and similar terms) using Google on the internet.

Interflora took a number of steps to identify potential witnesses for the trial of the action. The company looked at potential witnesses from among its own customers in the UK and identified 106,006 individuals from its marketing databases. Each individual was sent an email link to a questionnaire which contained a number of questions. A total of 6,866 individuals completed the questionnaire. Of those, 395 were identified as having seen the Marks & Spencer link in response to an internet search for 'interflora'. All were telephone interviewed to determine if they were prepared to be witnesses, which resulted in 56 individuals who were prepared to be contacted again. Each of the 56 was interviewed by Interflora's solicitors (contemporaneous notes of the telephone calls were disclosed to Marks & Spencer's solicitors) and witness statements were obtained from 13 of the individuals.

The parties were in dispute as to whether the exercise was a 'survey' or not. The court concluded that it did not matter whether one called the exercise a survey or not. The only question to be answered by the court was whether permission should be granted to adduce the evidence. Accordingly, was the evidence of the 13 witnesses of value and did the value of the evidence justify the costs involved?

Decision

The judge, Arnold J, considered that the evidence was of some value and that the value of the evidence did justify the cost. He granted Interflora permission to adduce the evidence of the 13 witnesses.

Concerning value of the evidence, the judge agreed with Interflora that the witness evidence provided evidence of confusion which was regarded as highly relevant in trade mark and passing off cases

While Marks & Spencer said that the evidence was not representative of the legal construct through whose eyes the question of likelihood of confusion falls to be assessed, the judge rejected this argument. Claimants had never been required to show that the confused witnesses were statistically representative of the consumer population. In addition, Interflora had explained its witness gathering procedure in detail and had provided full disclosure of relevant documents. Interflora had thus provided full transparency.

On costs, the judge examined costs incurred by the parties to date and anticipated costs to end of trial and concluded that the costs of the witness evidence appeared to be no more than 5% of the total costs of the litigation. Therefore, he concluded that the value of the evidence justified the costs involved.

Marks & Spencer appealed the decision. On 16 April 2013, the Court of Appeal ruled that the judge had mischaracterised the evidence by labelling it evidence of "actual confusion". It was not: the question asked of the witnesses (which the Court of Appeal considered an unfair question) was not directed at the actual experience of the witness (it was only to be asked if the interviewee failed to mention a connection between Interflora and Marks & Spencer). There was obvious confusion between past experience of a witness and response to a leading question which was inherent in the way that question was framed. One interviewee even articulated the effect of the question asked, and it was very likely that other interviewees thought it, or did not realise the effect of the question on their answers. Finally, the Court of Appeal said that a judge should not admit evidence of this kind unless the party seeking to call it satisfied him that (a) it was likely to be of real value; and (b) the likely value of the evidence justifies the costs. In the present case, the judge had asked himself whether the evidence was of "little or no value". The Court of Appeal was unable to determine if the judge simply thought that the value would be more than minimal or whether he thought that it would carry real weight. If the latter, it was hard to identify why he thought that. In the Court of Appeal's view, the judge had conducted a flawed analysis of the nature of the application, the quality of the raw data that supported the witness statements, and ultimately applied too lax a test.

Comment

The Court of Appeal's ruling makes clear that evidence of "little" or "no value" or minimal value is not sufficient to be admitted. The evidence must be of "real" value as well as likely to justify the costs. The Court of Appeal made clear that the days of survey evidence are not at an end. On the contrary, surveys may lead to witnesses of value.

But if the circumstance of the evidence gathering amounts to mere "scratching around for something" and that exercise produces very little, there is good reason to exclude the evidence.

High Court rules that A & E Television's HISTORY channel trade mark is not infringed by Discovery's DISCOVERY HISTORY

The High Court found in favour of the defendant and said that the defendant was entitled to the benefit of the protection conferred by section 11(2)(b) of the Trade Marks Act 1994 - the word HISTORY identifies the characteristics of the goods (namely a channel which provides history programmes) and the addition of the word DISCOVERY serves to distance Discovery's channel from A & E Television's channel.

A & E Television Networks LLC and another v Discovery Communications Europe Ltd [2013] EWHC 109 (Ch), 1 February 2013.

Background

The claimants A & E Television Networks LLC and AETN UK ("AETN") broadcast two very popular channels in the UK, HISTORY (previously known as the HISTORY CHANNEL from 1995 to 2008) and MILITARY HISTORY. The defendant Discovery Communications Europe Ltd ("Discovery") also broadcasts cable and satellite channels in the UK. In 2010 it changed the name of its DISCOVERY KNOWLEDGE channel to DISCOVERY HISTORY.

AETN claimed that the name DISCOVERY HISTORY had caused and would continue to cause deception amongst members of the public who believe the channel is connected with HISTORY (the reputation of HISTORY is such that the addition of DISCOVERY will not dispel deception.

AETN claimed passing off in respect of Discovery's use of the names HISTORY, THE HISTORY CHANNEL and MILITARY HISTORY. AETN also claimed trade mark infringement of its UK word mark THE HISTORY CHANNEL, a Community trade mark ("CTM") THE HISTORY CHANNEL and a CTM for the word HISTORY plus a device consisting of the letter H:

Discovery's logo is as follows:

Decision

The High Court ruled that Discovery's use of the name and logo DISCOVERY HISTORY and the abbreviation DISC. HISTORY, the latter used in a TV programme guide, did not infringe either the UK trade mark THE HISTORY CHANNEL, or the CTMs for the same words and the AETN logo incorporating the word "History" above.

Having considered the facts and evidence, the judge said that Discovery had the benefit of the defence available under section 11(2)(b) of the Trade Marks Act 1994 and under Article 12(b) of the CTM Regulation (207/2009/EC):

Section 11(2) (b) states:

"A registered trade mark is not infringed by....the use of indications concerning the kind, quality, intended purpose, value, geographical origin, the time of production of goods or of rendering of services, or other characteristics of goods or services,...";

Article 12(b) of the CTM Regulation states:

"A Community trade mark shall not entitle the proprietor to prohibit a third party from using in the course of trade....indications concerning the kind, quality, intended purpose, value, geographical origin, the time of production of goods or services or of rendering of the service, or other characteristics of goods or services;...".

Firstly, the judge said that Discovery's use of the word HISTORY on its own did not do anything other than identify the nature of its operation (the delivery of history related TV programmes). The judge also said that the addition of the word DISCOVERY serves to distance Discovery's channel from AETN's channel because DISCOVERY identifies the channel with a group of channels from Discovery of which Discovery History is but one.

Equally, the judge said that use of the word HISTORY did not infringe the registered trade marks because of the provisions of section 11(2)(b) and Article 12(b) as the word HISTORY identifies the characteristics of the goods (namely a channel which provides history programmes).

Further, AETN's word History plus device consisting of the letter H was not infringed by...