Trade marks - conditions for registration

Trade marks may be refused registration on grounds relating to the nature of the mark itself - ‘absolute grounds’ - or on grounds relating to prior existing rights belonging to others - ‘relative grounds’. The same grounds may be used in opposition proceedings before the Trade Marks Registry, by third parties who do not wish a mark to become registered, or in legal challenges to the validity of a registration.

The Registry does not apply all the grounds in its examinations. For example, it leaves to third parties the task of opposing registrations on grounds relating to the existence of copyright or earlier common law rights.

Practice differs considerably between national trade mark registries, even – despite the Directive – within the EC (and also between national registries and OHIM). The UK is likely to change in the future – perhaps sooner rather than later: see below.

Absolute grounds

The absolute grounds on which registration can be refused are set out in section 3. It implements Article 3 of the Directive.

This section replaces sections 9 and 10 of the 1938 Act, which contained the two tests of distinctiveness for Part A and Part B of the register respectively. The provision of a single set of criteria does away with the split register, which would not be compatible with the Directive.

Outside the definition (section 3(1)(a))

A sign which is not within the definition of trade mark in section 1 will be excluded from registration. This will pose problems where a trade mark is not capable of graphical representation, which could be difficult for a smell mark for example. Whether it is capable of distinguishing is a matter of law1.

The provision seems at first sight to be tautologous. It prevents the registration as a trade mark of something that is not a trade mark anyway. But the wording of section 3(1)(a) differs from Article 2 of the Directive, and in any event its apparently immense scope could render the succeeding provisions redundant unless a restrictive interpretation were placed on it.

In AD 2000 Trade Mark2, Geoffrey Hobbs QC (hearing an appeal against refusal as an Appointed Person under section 76) considered that section 1(1), which section 3(1)(a) supports, required the sign to have the potential to distinguish. A sign which lacks even that small capacity to act as a trade mark will not be registrable, and no amount of use of the mark can assist. On the other hand, if the mark dies have the potential to distinguish but in fact is not distinctive it may face objections under the following headings, in which case use leading to acquired distinctiveness may overcome the objection.

In THANK YOU3 the Registrar considered that the test laid down in Re W&G’s TM4 still held: the question to ask is whether the mark is capable of acting as a trade mark without trespassing on the legitimate freedom of other trades. In British Sugar Jacob J confirmed that descriptive and laudatory words would, prima facie, lack distinctive character, although evidence might show the contrary. He asked:

... considering the mark on its own and assuming no use, is it the sort of word (or other sign) which cannot do the job of distinguishing without first educating the public that it is a trade mark?

Distinctiveness (section 3(1)(b))

This provision excludes marks from registration if they are devoid of distinctive character. A mark which is descriptive of the goods to which it is applied will be excluded from registration under this provision, as will any other word which another trader might legitimately wish to use to describe her goods. An ordinary word cannot denote a trader’s goods unless its old meaning is displaced: see the Treat case, where Jacob J was of the view that s1(1) adds nothing significant to s 5(1)(b): they were synonymous. However, Geoffrey Hobbs QC in the AD 2000 decision thought differently: where s1(1) (and s3(a)(a)) was concerned with the sign’s capacity to distinguish, s 3(1)(b) required it actually to do so, which only happens when consumers are aware of the sign being used as a trade mark. The s 3(1)(b) ground is therefore concerned with the immaturity of the sign. In British Sugar the word TREAT was held to be a laudatory epithet that should remain in the public domain: it was invalidly registered on the grounds of section 3(1)(b) and (c), and probably also (d). In Phillips v Remington Jacob J held that the same was true of a drawing of the three-headed electric shaver head used by Philips.

It is no longer possible for a mark that is in fact distinctive to be considered unregistrable in law.

This provision implements Article 3(1) of the Directive, and also reflects the requirements of Article 6 quinquies of the Paris Convention. This latter provision limits the grounds on which registration of a trade mark which is validly protected in another country party to the Convention may be refused.

Descriptive marks (section 3(1)(c))

If the essence of a trade mark is its distinctiveness, a sign which is descriptive is not a good choice as a trade mark. The public interest lies in keeping descriptive matter in the public domain for trades to use without restriction: and no-one’s interest is served by granting any exclusive rights over such matter.

A trade mark is not registrable if it consists exclusively of signs or indications that may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin, or time of production of goods or rendering of services, or other characteristics of the goods or services - that is, it is descriptive. The courts have considered descriptiveness many times: see for example TORQ-SET5, WELDMESH6, ROTOLOK7, WHISQUEUR8. Under the old law, a mark would prima facie be unregistrable if it was so descriptive of goods or services that others in the business community would regard it as descriptive and legitimately wish to use it.

However, a trade mark must be considered as more than just the sum of its component parts. In the BABY DRY case, Proctor & Gamble appealed to the CJEC against the refusal of registration of their CTM. The Court accepted that the two ordinary words that made up the mark alluded to characteristics of the goods, but taken as a whole the mark was not a descriptive term and should be registered.

In Case C-191/01P, OHIM v Wm Wrigley Jr Company, Advocate-General Jacobs indicated that DOUBLEMINT should be regarded as purely descriptive. The applicant, appealing against OHIM’s refusal (and against the decision of the Board of Appeal), argued that the term was ‘ambiguous and suggestive’, and that the average consumer would not immediately detect the description of a characteristic of the goods.

The Advocate-General took the view that the words ‘consists exclusively’ in Article 7(1)(c) of the Directive meant that all elements of a mark must have a descriptive capacity, but it was not necessary that they should have no other meaning. The fact that the two words in suit had a variety of possible meanings did not mean that they were not descriptive.

In deciding whether a term designated characteristics of a product, or was merely suggestive, three tests should be applied:

    1. What is the relationship between the term and the product? If it is factual and objective, the term is likely to be used as a designation in trade, so registration will be refused. If imaginative and subjective, on the other hand, it should be registrable.
    2. How immediately is the message conveyed? The more ‘ordinary, definite and down to earth’ a term is, the more likely that registration should be refused.
    3. What is the significance of the characteristics in relation to the product in the consumer’s mind? Where the characteristic described is essential the case for refusing registration is compelling, whereas if the characteristics are incidental or arbitrary, the case is weaker.

But a sign that is descriptive of what the product represents cannot be considered descriptive of the product itself, the CJEC held in Case T-140/00, Zapf Creation AG v OHIM. The application was for the mark NEW BORN BABY, for dolls and accessories, and the Court considered that it was not necessarily descriptive of the dolls themselves: it had not been proved that the target audience would understand that that the sign designated a quality of the goods. The accessories certainly did not represent new born babies. As for distinctiveness, the court reckoned that just because a sign lacked imagination did not mean it automatically lacked distinctiveness too: Cases T-135/99 and T-136/99, Taurus Film GmbH v OHIM.

Generic trade marks (Section 3(1)(d)

Trade marks which consist exclusively of signs or indications that have become customary in current language or in the bona fide and established practices of the trade - generic trade marks - will also be excluded from registration. There will often be overlap between this head and the preceding ones. Again, it would be contrary to public policy to create exclusive rights in, say, an expression for which there were no satisfactory synonyms. Thus trade marks such as ASPRIN and LINOLEUM have lost their distinctiveness: and GRAMOPHONE was generic before an application for registration was even filed. It is however rare for a mark to be refused registration because it is generic. This is more likely to be a problem encountered later in a mark’s life.

Acquired distinctiveness

A trade mark which would otherwise be refused registration on the grounds that it lacks distinctiveness or is descriptive or generic may nevertheless be registered if it has acquired a distinctive character in use. As Geoffrey Hobbs QC said in AD 2000, a trade mark must be ‘endowed by nature and/or nurture’ with the capacity to indicate the origin of the goods or services on which it is used. This must have happened before the date of the application for registration: use after the application date is of no assistance, as it is the mark’s distinctiveness at the time of the application that must be considered.

Geographical names will be more readily registrable under the new Act than under its predecessor, which prevented registration of major place names9. Surnames (which are not specifically excluded by the new Act) generally lack inherent distinctiveness: but they may acquire distinctiveness and become registrable. Some signs will never be registrable: Jacob J gave the example of the sign SOAP for soap in the British Sugar case.

Shapes

There are special rules applicable to shapes. Article 3(1)(e) of the Directive requires the laws of Member States to exclude such marks from registration if they consist exclusively of:

    • A shape which results from the nature of the goods themselves;
    • The shape of goods which is necessary to achieve a technical effect; or
    • A shape which gives substantial value to the goods.

A shape mark that is unregistrable under this head cannot be saved by acquired distinctiveness.

These exclusions are intended to prevent the trade marks system being used as a way to secure indefinite protection for matters covered by the monopoly conferred by patent, design or copyright. If a shape has a utilitarian purpose, then it should be free for others to use once other intellectual property rights have expired. In Philips v Remington the shaver head was considered necessary to achieve a technical result and to give substantial value to the goods. The registration was consequently revoked.

Prohibited Matter

Public policy

Section 3(3) prohibits registration of:

    • marks which are contrary to public policy or to accepted principles of morality10, and
    • marks of such a nature that they would deceive the public. The Act provides examples of what the public may be deceived about: the nature, quality or geographical origin of the goods or service11. The use of the definitive article is significant: in particular, it is not a quality of the goods or services that is relevant.

Public policy and morality

Under the old legislation, in HALLELUJAH (1976), the trade mark was refused registration: the goods concerned were jeans, which were also involved in the more recent JESUS case. The Registrar will follow rather than lead public opinion, but mild bad language now seems to be acceptable.

Deceptiveness

The Act provides examples of what the public may be deceived about: the nature, quality or geographical origin of the goods or service (ORLWOOLA (1909) 26 693 & 850 – the court recognised a ‘grotesque misspelling’ of ‘all wool’ – and WEE McGLEN (1980).

In Moog v Winter (2003) the Trade Marks Registry held that the absolute ground for refusal based on a mark’s deceptiveness did not apply to alleged deceptiveness about the ownership of the mark, only deceptiveness arising from the nature of the mark itself. The defendant registered a trade mark consisting of the word MOOG, for electronic musical instruments, in 1996. In 1999 the petitioner, Dr Robert Moog, the inventor of the eponymous synthesiser, applied for it to be declared invalid. His original registration, which had been transferred to a manufacturing company, lapsed in 1994 although there had been some manufacturing activity involving spare parts after that date.

The petitioner argued that the mark was well-known in the UK, and that the respondent had acquired no rights to use it from any previous owner. He contended that the use of the mark by the respondent would deceive the public into thinking that the respondent’s goods came from the petitioner or a previous owner of the trade mark, so the registration was invalid under section 3(3)(b). He also claimed that the application for registration of the mark had been made in bad faith and contrary to section 3(6).

The Registrar held that section 3(3)(b) did not apply where the alleged deceptiveness arose from the ownership rather than the nature of the mark. Dr Moog was in fact seeking to rely on an earlier right under section 5(4)(a), which protects pre-existing unregistered trade marks: the question was therefore whether Dr Moog owned sufficient residual common law rights to be able to sue for passing off. This was likely to be small, and there was no evidence showing when the sale of Moog synthesisers had ceased in the UK. If there was any, it was not clear who would own it. The same argument would mean an application for a declaration of invalidity under section 5(4) would also fail.

Nor was there any bad faith shown by the petitioner. There was no reason to assume that the respondent was aware of any continuing use of the mark in the UK when he applied for registration.

Marks prohibited by law

Perhaps, one day, tobacco trade marks will be denied registration, though for the time being it is merely that there are restrictions on the use of the marks in advertising.

Protected emblems

Marks which consist of specially-protected emblems specified or referred to in section 4 are excluded from registration by section 3(5). This covers the Royal Arms and certain flags, and other matter. Olympic symbols are protected by their own legislation.

Bad faith

If an application to register a trade mark is made in bad faith, the mark will not be registrable. Section 3(6), which contains this provision, does not define what ‘bad faith’ means, so this is a matter for the courts and the registrar to consider in each case. The government has suggested several examples:

    • where the applicant has no bona fide intention of using the mark, or intends to use it but not for the whole range of goods and services listed in the application in which case it will be refused for the surplus goods or services, the applicant narrowing the specification to meet the objection in most cases, or if registered may be partly revoked, as in MINERVA [2000] FSR 73412where Jacob J amended the specification as necessary:
    • where the applicant is aware that someone else intends to register the mark, especially where the applicant has a relationship with that other person (for example, as an employee or agent) or where the applicant has copied a mark being used abroad with the intention of pre-empting the proprietor, who may intend to trade in the UK:
    • where the mark incorporates the name or image of a well-known person without her agreement.

In addition, an attempt to stockpile marks would fail under this provision. The applicant must state on Form TM3 now that there is a bona fide intention to use the mark, or that it is used, on the grounds or services.

This provision will also be effective against ‘ghost’ marks, registered where the marks of interest would be unregistrable13.

Relative Grounds

Section 5 of the Act sets out the so-called relative grounds on which registration of a mark may be refused. They are relative in the sense that they are concerned with existing rights belonging to others: the provision uses the concept of an ‘earlier trade mark’, which is defined in the following section of the Act. The provision also deals with other types of pre-existing rights such as copyright or design right, and common law rights.

Earlier Trade mark

An earlier trade mark is defined to include (section 6(1)(a)):

    • a trade mark registered under the Act;
    • an international mark (UK) (i.e., a mark registered under the Madrid system, on which see below, which has effect in the UK); and
    • a Community Trade Mark.

A mark falling within one of these categories will be an earlier trade mark if its date of registration was earlier than that of the mark in question, taking into account the priority claimed for each of them. An application may claim priority from an earlier application ina Convention country (or the Community system): the Paris Convention stipulates a priority period of six months.

    • Also included are:
    • Community trade marks which have valid claims to seniority from an earlier registered trade mark or an international mark (UK) (section 6(1)(a));
    • A well-known mark within the meaning of Article 6bis of the Paris Convention (section 6(1)(b)); and
    • A mark for registration of which application has been made which would (under the normal rules) be an earlier mark if registered (section 6(2)).

A Community trade mark may claim seniority from an earlier national trade mark registration in one of the Member States. So long as the earlier mark remains registered it could prevent the registration of an identical or similar mark, either under the national law of the Member State concerned or under the Community Trade Mark Regulation. Giving the right to claim seniority avoids the need for the proprietor to maintain Community and national registrations.

Where there is an earlier trade mark within sub-sub-section (a) or (b) of section 6(1), and it expires, the Act will continue to count it as an earlier trade mark for a year. It can therefore still be relative grounds for refusing registration to a later mark. However, if the Registrar is satisfied that there was no bona fide use of the mark for two years before the expiry, he may disregard that mark.

Earlier rights as obstacles: identical mark and sign, identical goods or services

The existence of an earlier trade mark will be a bar to registration of a mark if:

    • the later mark is identical to the earlier one, and
    • the goods or services specified in the later application are identical to those for which the earlier mark is registered.

This will happen comparatively rarely. More often, the problem will involve a similarity between the mark and the goods or services or both. A sign that differs only in insignificant details from a registered trade mark, which would not be noticed by the average consumer, may be considered identical. The trade mark owner would then escape the need to show that there was a likelihood of confusion. In Case C-290/00, LTJ Diffusion v Sadas Vertbaudet [2003] ECR 1-2799 the Court of Justice held that the perception of identity between marks must be assessed globally, with the average informed, reasonably observant and circumspect consumer in mind. Imperfect recollection would probably have to be taken into account as the consumer would often not have the chance to compare the signs side by side. In addition, the degree of attention that the consumer would pay to the signs would depend in part on the nature of the goods or services involved, so differences might be overlooked more readily on inexpensive everyday items.

In REED EXECUTIVE v REED BUSINESS INFORMATION [2004] EWCA Civ 159, [2004] R.P.C. 767, the Court of Appeal found that REED and REED BUSINESS INFORMATION were not identical: as Jacob LJ said,

... I do not think the additional words "Business Information" would "go unnoticed by the average consumer." In all uses of the phrase complained of they are as prominent as the word "Reed."

Earlier rights as obstacles: likelihood of confusion

The later application will be unregistrable if because it is

    • identical (section 5(2)(a)) or similar (section 5(2)(b)) to an earlier trade mark and
    • is to be registered for goods or services which are identical or similar to those for which the earlier mark is protected,

there is a likelihood that the public will be confused. This includes the likelihood that the public will associate the later mark with the earlier: but despite the wording of the provision, the government stated in Parliament that this sort of confusion does not have to be present. Recital 10 to the Directive enumerates factors to be taken into account in considering similarity and confusion.

The global assessment of the likelihood of confusion must, as regards the visual, phonetic or conceptual similarity of

the marks at issue, be based on the overall impression created by them, bearing in mind, in particular, their

distinctive and dominant components (Case C-251/95 SABEL [1997] ECR I-6191, paragraph 23; Lloyd Schuhfabrik

Meyer, paragraph 20 above, paragraph 25, and Case C-334/05 P OHIM v Shaker [2007] ECR I-4529, paragraph 35).29 According to established case-law, two trade marks are similar when, from the point of view of the relevant public,

there is an at least partial correspondence between them with regard to one or more relevant aspects (Case T-6/01

Matratzen Concord v OHIM – Hukla Germany (MATRATZEN) [2002] ECR II-4335, paragraph 30, and judgment of

26 January 2006 in Case T-317/03 Volkswagen v OHIM – Nacional Motor (Variant), not published in the ECR,

paragraph 46).

30 Moreover, this Court has held that the comparison must be made by examining each of the marks in question as a

whole, which does not mean that the overall impression conveyed to the relevant public by a composite trade mark

may not, in certain circumstances, be dominated by one or more of its components. It is only if all the other

components of the mark are negligible, however, that the assessment of the similarity can be carried out solely on

the basis of the dominant element. That could be the case, in particular, where that component is capable alone of

dominating the image of that mark which members of the relevant public keep in their minds, so that all the other

components of the mark are negligible in the overall impression created by it (see Case T-7/04 Shaker v OHIM –

Limiñana y Botella (Limoncello della Costiera Amalfitana shaker) [2008] ECR II-3085, paragraph 40 and the caselaw cited). The overall impression of a composite word mark may also be dominated by one or more of its

components

A global assessment of the likelihood of confusion implies some interdependence between the factors taken into

account, and in particular between the similarity of the trade marks and that of the goods or services concerned.

Accordingly, a low degree of similarity between the goods or services may be offset by a high degree of similarity

between the marks, and vice versa.(Case C-39/97 Canon [1998] ECR I-5507, paragraph 17, and VENADO

with frame and others, [2006] ECR II-540, paragraph 74).

The confusion test includes the impression that the two marks, though graphically indistinguishable, may produce in the mind of a customer. If the customer is likely to believe that the goods bearing the mark the subject of the application have a connection with the proprietor of the earlier mark, the later application will be refused. Allowance must be made for the consumer’s imperfect recollection14 and for the fact that marks are often compared serially, not side by side15. In addition, account must be taken of common linguistic matters such as variations in pronunciation16, the prominence of the first syllable, and the tendency to slur endings.

The concept of confusing similarity, adopted in the Directive from Benelux law, imports some principles from the law of passing off. But the Benelux law does not rely on the public being confused about the origin of goods, so it goes beyond what is established in common law (HP Bulmer Ltd v J Bollinger SA17). In Benelux law, it was an infringement if the defendant’s sign caused people to think of the earlier mark, even without confusion: thus, association includes confusion18. The Directive, after much debate, makes confusion rather than association the touchstone, and section 5(2) follows it. The impact of this provision is one of the unknown factors in the new Act. It arose in the first reported case on the 1994 Act, Wagamama Restaurant v City Centre Restaurants19, where the court declined to consider the proceedings of the meeting of the Council of Ministers where the directive was adopted. A document purporting to be a minute of the meeting (which in common with other meetings of the Council was secret) has been circulated quite widely and reproduced in several publications, but the court was unable to take it as authentic: and that meant that the connection with the Benelux law could not be established.

The wording of this provision in the Act also leaves open the question, what are similar goods? Under the 1938 Act, a concept of ‘goods of the same description’ was employed to define the scope of conflicts with earlier registered trade marks. In Re Jellinek’s Application20 the court considered the factors to be considered were the use to which the goods would be put, the uses of the goods, characteristics of the goods and the trade channels by which the goods would be distributed. The Trade Marks Registry’s Work Manual, chapter 6, reiterates this approach.

The test for similarity of marks in Benelux law was laid down by the Benelux Court of Justice. In Union v Union Soleure21 the court held:

Similarity arises, taking into account the particular circumstances of the case, where the mark and the sign, each looked at as a whole and in correlation, show such a resemblance auditively, visually or conceptually, that by this resemblance alone associations between the sign and the mark are evoked. The question of the similarity of the goods is wholly independent of the claimant’s registered trade mark or the defendant’s sign22.

    • In case C-39/97, Canon KK v Pathe Communications Corporation [1998] ECR I-5507 (CJEC) the Advocate General suggested that the court should also consider the reputation of the trade mark that is infringed. This elides the question of similarity of goods, where the Directive does not seem to say market recognition is important, and the likelihood of confusion, where recital 10 of the directive makes clear that recognition and reputation are relevant issues. Advocate General Jacobs thought it ‘permissible to consider goods or services to be similar in relation to particularly distinctive marks when such goods or services would not be considered to be similar in relation to other, less distinctive marks.’ As Jacob J pointed out in British Sugar, this would mean strong marks enjoyed protection for a wider range of goods or services than weak ones23.
    • In LLOYD SCHFABRIK the Court of Justice said that it is for the national trade marks office to assess the likelihood of confusion on the basis of a “global appreciation”, taking into account all the circumstances of the case. The court declined to lay down detailed rules about either the degree of similarity there would have to be between one-syllable word marks (“Lloyd” v “Loints” in that case) or the effect of any particular level of public recognition. Is there a genuine and properly substantiated likelihood of confusion on the part of an average consumer? (See also Sabèl, Gut Springenheide [1998] 1 ECR 4657, Chiemsee v Huber [1999] ETMR 585.) Again, as Jacob LJ said in REED:

To confuse only the careless or stupid is not enough.

    • The average consumer is one who is “reasonably well informed and reasonably observant and circumspect”.
    • As the chance to make a direct comparison is rare imperfect recollection must be taken into account (“... due allowance must be made for the occasions when the person who sees to the other use has only a general recollection of the normal and fair use by the proprietor of the trade mark”, per Aldous LJ in Thomson Holidays v Norwegian Cruise Line [2003] R.P.C. 586, at para 60)
    • The fact that the average consumer’s level of attention will vary for different types of goods and services must be borne in mind (Lloyd, Case T-185/02, Claude Ruiz-Picasso and others v OHIM).
    • Visual and conceptual similarity have to be considered.
    • Aural confusion might suffice. (Lloyd, para 28).
    • The more distinctive the prior mark has become through use, the more probable that there will be confusion (CANON, para 18). Pumphrey J “Very surprising” “perhaps only a presumption of fact” in Reed at fist instance – Jacob LJ agreed.
    • Where both marks are characterised by some unusual or original feature this increases the risk of confusion Sabèl, LLOYD
    • A descriptive element reduces the risk of confusion CHIEMSEE, REED (“It is worth examining why that factual proposition is so – it is because where you have something largely descriptive the average consumer will recognise that to be so, expect others to use similar descriptive marks and thus be alert for detail which would differentiate one provider from another. Thus in [Office Cleaning Services v Westminster Window and General Cleaning (1946) 63 RPC 30 at p.43] ‘Office Cleaning Association’ was sufficiently different from ‘Office Cleaning Services’ to avoid passing off.” - per Jacob LJ)
    • In considering whether there is a likelihood of confusion, the Court of Justice requires a “gobal appreciation” of the mark and sign. The word LIMONCELO with a device of a dish decorated with lemons, for lemon liqueurs, was barred by LIMONCHELO for alcoholic drinks. Global assessment must be based on the overall impression created by the marks, considering in particular their distinctive and dominant components. It is necessary to determine the degree of visual, aural or conceptual similarity between the marks and where appropriate to consider the importance of those various factors, taking account of the relevant goods or services and the circumstances in which they were marketed. Whether then visual element is dominant depends on whether words and concept are negligible: OHIM v Sucker di Laudato & C SuS Case C-334/05.

Earlier rights as obstacles: Marks with a reputation

A mark may become so well-known in its own field that the use of an identical or similar mark in a different field might cause consumers to infer that there was a trade connection. They might assume that the owner of the well-known mark has diversified or has licensed someone else to use the mark. A mark with a reputation (in the wording of section 5(3)) therefore enjoys an additional level of protection against what is known as dilution.

‘Reputation’ is probably an unfortunate word. Looking at the French version of the directive, the language is perhaps better translated as ‘of repute’. (It is also interesting to note that French trade mark law uses a single concept to cover marks of repute and well-known marks, on which see the next section.)

Even if members of the public do not make this inference, the registration of a sign that could be taken for a well-known mark for other goods could inhibit the ability of the proprietor to diversify or to licence the use of the mark on those goods. The attractive power, and therefore the value, of the mark would be diluted by such use. Indeed, the value of a mark may be diluted if a similar or identical mark is registered even for dissimilar goods or services, in the same way as use of another trade mark in such circumstances will amount to an infringement.

Section 5(3) therefore confers broader protection on marks with a reputation. This implements Article 4(3) and (4)(a) of the Directive, which also borrows from Benelux trade mark law.

In this case, a mark which is identical or similar to an earlier mark which has a reputation may not be registered even for goods or services which are not similar to those for which the earlier mark is registered. However, it is necessary for the use of the later mark ‘without due cause’ to amount to taking advantage of or to be detrimental to the distinctive character or repute of the earlier mark. This begs the question, how could such use ever be with due cause? In Claeryn/Klarein24.

The reputation of an earlier UK mark or international trade mark (UK) which is to be taken into account under this provision must be in the UK. If the mark in question is a Community Trade Mark the reputation can be anywhere in the Community.

Section 5(3) abuts rather than overlaps s 5(2). The two provisions should be seen as mutually exclusive, which may assist interpretation. There is no requirement for confusion in the face of the legislation (the wording is identical in the directive): in BABEWATCH, and in BASF plc v CEP25 the High Court believed confusion had to be shown, although in Sabèl BV v Puma AG [1997] ECR I-6191 the CJEC rejected this.

Earlier rights as obstacles: Well-known marks

Article 6 bis of the Paris Convention, which requires well-known marks to be protected, is implemented by section 56. In section 6(3)(b), its effect must be taken into account by providing that a mark protected under this provision will prevent the subsequent registration of an identical or similar mark.

Earlier rights as obstacles: Other Prior Rights

A trade mark will also be refused registration if its use in the UK is likely to be prevented

    • by any rule of law protecting an unregistered trade mark, or other sign used in trade (section 5(4)(a)); or
    • by an earlier right other than an earlier trade mark right (section 5(4)(b)).

The first of these is directed in particular at earlier common law rights, and the second at copyright, design right and registered designs. The section 5(4)(a) derogation is permitted under Article 4(4)(b) of the Directive. It gives important protection to owners of prior unregistered trade marks, but it is not clear whether the Act requires only passing off by the conflicting mark to be shown, or passing off in all circumstances.

Paragraph (b) of this sub-section covers other sorts of earlier rights. No-one may validly register a trade mark if it consists of a work protected by someone else’s copyright, or by rights in a design. This implements Article 4(4)(c) of the Directive. It has been used in the case of the Direct Line application referred to above, in connection with a dispute over ownership of the copyright in the jingle. The putative owner of the copyright opposed the application, claiming to own copyright in it. Another illustration of the problems that can be created by copyright is provided by R Griggs Group Ltd & Ors v Evans & Ors (View without highlighting) [2005] EWCA Civ 11 (25 January 2005). In these days of three-dimensional trade amrks, and of extensive protection for designs, rights in registered and unregistered designs will also be important.

Consent

The consent of the owner of the earlier right in question (including an earlier trade mark) will enable the later application to proceed. Such consent will often even overcome the Registrar’s view that there is a likelihood of confusion: it will be taken as an indication from someone in the marketplace that there is no such risk.

However, consent is not necessarily conclusive. Article 4(5) of the Directive gave the option of providing that ‘in appropriate circumstances, registration need not be refused.’ The subsection therefore goes on to provide that the final decision is for the Registrar.

Honest Concurrent User and Vested Rights

The so-called ‘honest concurrent user’ has always previously been able to register the mark notwithstanding an earlier registration, subject to the Registrar’s discretion to allow two marks on the register at the same time, under section 12(2) of the 1938 Act. But the new Act differs radically from its predecessor in its treatment of marks which were in use before another person applied to register them.

The proprietor of a mark who is able to show de facto concurrent use, and to succeed in a passing off action, has no right to have her mark registered. The register would not therefore accurately reflect the marketplace: the registered proprietor would not be the person identified by customers as the owner of the mark. This means that trade mark owners must no longer rely on common law rights alone, but go for registration whenever possible.

The steps of the procedure can be summed up thus:

    • Is there an earlier trade mark or other right?
    • Has the applicant satisfied the Registrar that there is honest concurrent use?
    • Does the proprietor of the earlier right oppose registration of the later mark?

If so, the Registrar may refuse. If not, he has no discretion to do so.

Acquiescence

There is no scope within the Directive to deal with acquiescence by the owner of a registered mark in the use of a similar unregistered mark by someone else. The owner of the unregistered mark would, of course, be able to oppose the registration of the later mark if there was enough of a reputation in the unregistered mark to sustain an action for passing off: but the new Act does not provide that such acquiescence will suffice to get the second mark onto the register.

Objections on relative grounds

Section 7 provides a mechanism under which the burden of raising objections on relative grounds falls in certain circumstances on the owner of the earlier mark rather than on the Registrar. If the applicant is able to satisfy the Registrar that there has been honest concurrent use, the Registrar will not be able to sustain an objection: the application will be registered and it will be for the owner of the earlier mark to oppose. The honest concurrent user therefore gets the benefit of any doubt there may be: in other words, honest concurrent use shifts the burden of proof to the proprietor of earlier mark. This provision is a pale imitation of Section 12 of the 1938 Act, where the honest concurrent user of a trade mark would obtain registration alongside the proprietor of an identical mark. The Directive would not have permitted the retention of such a provision, but section 7 is justified by reference to the fact that many other trade mark systems, especially in Continental Europe, do not involve pre-grant examinations of applications, so concurrent registrations are common.

Under this system, trade mark owners - whether their marks are registered or unregistered- must maintain a watch for applications that conflict with their marks. The Registrar may insist that the applicant give notice of the advertisement of its application to the proprietor of the cited mark.

If there is an opposition from the owner of the earlier mark, the Registrar will have to decide whether the grounds for refusal have been established. If the marks are identical, and so are the goods or services for which registration is sought, the application must be refused: the fact that there has been honest concurrent use will not overcome an objection under section 5(1).

If, however, either the mark of the goods or services are merely similar (within section 5(2)), a likelihood of confusion on the part of the public will have to be shown for the opposition to succeed. Concurrent use of the two marks will probably make it difficult for such a likelihood to be shown.

Similarly, if the opposition is based on the fact that the later mark would unfairly take advantage of the reputation of the earlier one (section 5(3)), it may be material that the two have co-existed in the past.

Vested rights

The question of the rights of the owner of an earlier trade mark to register it is still only half the story. Section 7 of the 1938 Act also provided a saving for vested rights, not repeated in the 1994 Act.

This meant that the proprietor of a registered trade mark could not interfere with or restrain the use by any person of a similar or identical trade mark which that person had been using on the same goods before. The section also required that the use be continuous, and have started earlier than the use of the mark by the proprietor of the registered mark (or a predecessor in title) or before the registration of that mark.

The prior rights owner could apply to register his mark under section 12(2) of the 1938 Act, but was also immune from an infringement action. He is not so well-protected under the new law.

Section 11(3) of the new Act provides that no infringement is committed by the use in the course of trade in a particular locality of an earlier right which applies only in that locality. What is a particular locality is far from clear, but the government explained that the provision is designed to protect small, local businesses such as plumbers whose trade name may be registered by a national organisation. Article 6 of the Directive provides that the registration of a trade mark must not permit the proprietor to prohibit a third party from using an earlier local right recognised by the laws of the Member State.

An opposition-based system

Section 7 of the Act empowers the Secretary of State to change by statutory instrument the provisions which require the Registrar to make a search and to refuse registration on relative grounds may be changed by statutory instrument. This would leave it to the owners of other rights to raise objections on relative grounds and thus to keep the register clean. However, it may only come into operation when the Community system had been going for 10 years.

Section 37 presently requires the Registrar to do this. However, the same procedure will not be followed in the Community Trade Mark Office, where the only way for relative grounds to prevent the registration of a later mark will be for them to be raised in opposition proceedings.

This will give rise to an anomalous situation. UK marks will have to go through this rigorous procedure while Community trade marks, which will have the same effect in the UK, will be registered without a search.

In addition to modifying the arrangements for searching for earlier trade marks, the Order which the Secretary of State may make may also cover who may apply for the registration of a mark to be declared invalid on relative grounds. Section 47(3)

1Note 1, supra.

2[1997] RPC 168, 173-4.

3Trade Marks Registry, 1995.

4[1913] AC 625.

5[1959] RPC 344.

6[1966] RPC 220.

7[1968] RPC 227.

8(1948) 66 RPC 105.

9YORK TM [1984] RPC 231.

10HALLELUJAH [1976] RPC 605 (for jeans).

11ORLWOOLA (1909) 26 RPC 693 & 850, WEE McGLEN [1980] RPC 115.

12In Premier Brands UK Limited v. Typhoon Europe Ltd [2000] FSR 767 Neuberger had taken the view that it was not necessary to look beyond the list of goods or services contained in the registration. In MINERVA Jacob J had good reason not to follow this approach.

13Imperial Group v Philip Morris [1982] FSR 72 where the applicant sought to protect the mark MERIT by registering NERIT.

14Neutragena Corp v Golden Ltd [1996] RPC 473.

15OPEN COUNTRY TM [2000].

16Aristoc v Rysta (note 1, supra), Berlei (UK) Ltd v Bali Brassiere Company [1969] 1WLR 1306, [1969] 2 All ER 812.

17[1978] RPC 79.

18See Monopoly/Antimonopoly, Dutch Supreme Court, 24 June 1977.

19[1994] FSR 713.

20(1946) 63 RPC 59.

21Decision of 20 May 1983.

22Per Jacob, J. in British Sugar, and see also Baywatch Production Company Inc v Home Video Channel [1997] FSR 22, [1997] EMLR 102 (Ch D) (hereinafter ‘Babewatch’), where videotapes were considered similar to television programmes.

23See also Office Cleaning Services v Westminster Window and General Cleaners, (1946) RPC 39 (HL).

24(1976) 7 11C 420.

25[1996] FSR 22.