High Court - LOTUS Trade Mark And Passing Off

Group Lotus plc and another v 1Malaysia Racing Team SDN BHD and others, [2011] EWHC 1366 (Ch), Peter Smith J, 27 May 2011

The High Court has given its judgment in a case concerning trade mark infringement and validity, passing off and breach of contract relating to LOTUS trade marks.

Colin Chapman founded the Formula One Team Lotus in the 1950s, and then the car manufacturer Lotus Cars Ltd. The claimant was the car-manufacturing side of Lotus, and the defendant represented the Formula One racing side.

The factual history was complicated. The two sides had entered into agreements which provided for: the sharing of know-how, the use of various Lotus names, and the right to apply for new trade marks in line with their respective rights under the agreement. In December 2009, the claimant entered into a further licence giving the defendant the right to use the name "Lotus Racing" for Formula One racing.

The relationship between the parties then broke down and proceedings were commenced under several heads of claim and counterclaim. The claimants alleged trade mark infringement, passing off and repudiatory breach of the 2009 agreement. They also claimed that the defendant's registered marks were invalid or should be revoked for nonuse. The defendants alleged repudiatory breach of the 2009 agreement, passing off and partial revocation of the claimants' trade marks in relation to motor-racing activities.

The fact that both sides wanted to enter a team using the word "Lotus" in the 2011 Formula One season resulted in a speedy trial being ordered in January 2011.

In its decision, the court dismissed all the claims and counterclaims for trade mark infringement and passing off, and allowed the claimants' application for revocation of the two of the defendant's trade marks for non-use. Otherwise, the defendant was entitled to re-register and use its trade marks without further challenge from the claimant. The court also held that the claimant had been...