Sport Update: Merchandising; Photographic Rights and Image Rights

MERCHANDISING: ARSENAL -v- REED IN THE EUROPEAN COURT OF JUSTICE AND IN THE HIGH COURT (FOR THE SECOND TIME)

When the case of Arsenal Football Club plc -v- Matthew Reed came before Mr Justice Laddie in April 2001 he found that whilst Mr Reed was not passing-off his replica Arsenal kit as that of Arsenal Football Club, he needed help from the European Court to establish whether or not Mr Reed was infringing Arsenal's registered trade marks. The European Court appeared to indicate that Mr Reed was infringing Arsenal's registered trade marks but when the case went back to the High Court the Judge decided that it he had no option but to find in favour of Mr Reed. That judgment has been appealed and will be heard on 30 April 2003.

We will issue a further update once that decision is published.

Background

Mr Reed is an Arsenal fan who has been selling unofficial Arsenal memorabilia and souvenirs for over 30 years. Back in April 2001 Mr Reed convinced the Judge that, where used on replica kit and other merchandise, the ARSENAL name and badge did not function as trade marks in the traditional sense because the Arsenal marks did not tell people where the goods originated from. Rather, the Arsenal marks served merely as "badges of support, loyalty or affiliation". Since the law affords protection to the owners of registered trade marks in order to prevent people from misrepresenting the origin of their goods, Mr Reed argued that his use of the Arsenal marks, which did not misrepresent where the goods came from, was lawful.

The Referral

The Judge had some sympathy for this argument and found that the UK legislation was too vague for him to be able to interpret it without help from the European Court. He therefore referred the following questions to the European Court:

ï "Does a defendant in a registered trade mark infringement case have a defence on the ground that the use complained of does not indicate trade origin?"

ï "Is the fact that the use in question would be perceived as a badge of support, loyalty or affiliation to the trade mark proprietor a sufficient connection to be considered an indication of origin?"

Although, the European Court agreed that the enforcement of a trade mark registration must be reserved to cases where the use of the mark is liable to affect the consumer's ability to guarantee the origin of the goods in question, it went on to say that Mr Reed's use of the Arsenal marks was such as to create the impression that there was a material link between his replica goods and Arsenal. Mr Reed argued that there could be no such link because the sign above his stall told buyers that the merchandise was unofficial but the European Court said that when those goods were seen by others away from Mr Reed's stall, those others would not know that the goods were unofficial and would assume the contrary.

The European Court concluded by saying that use of a sign as an indication of support or loyalty in the manner used by Mr Reed was indeed use as an indication of origin. However, the European Court would not say if, on the facts, Arsenal had sufficiently proved that there was an infringement. That decision was for Mr Justice Laddie to make, bearing in mind what the European Court had said.

The European Court had been asked to interpret the law and was not provided with any of the evidence submitted to the High Court and therefore was not capable of reaching any decisions on the facts of the case. However...