Friday, 17 June 2016

Garage's use of carmaker's trade mark

It's rather hard to see why a case in which an unauthorised repairer, sued by the manufacturer for trade mark infringement, would even incur the expense of going to court. Nevertheless in Bayerische Motoren Werke AG v Technosport London Ltd and Anor [2016] EWHC 797 (IPEC) (13 April 2016) that is exactly what happened, and the defendant won on one count of trade mark infringement. But it lost on another two, and on passing off, so had a bad day overall.

BMW alleged infringements of their BMW trade mark, the roundel device and the "M" device which denotes certain high-performance models in their range. Perhaps I should write "extra-high performance".

The first two are Community or now EU trade marks, and the third an International designating the EU, so the legislation which was engaged in the case was Council Regulation (EC) No. 207/2009. In each case the claimant invoked art.9(1)(a) (double identity) and (b) (likelihood of confusion) and in the case of the "M" device art.9(1)(c) (unfair advantage) as well, and all three infringements had associated passing off claims. That seems pretty comprehensive.
 The uses of the trade marks were all the things that one expects of an unauthorised repairer. There was the use of the description "BMW Specialist" on the fascia on the garage premises, which it was accepted was not liable to affect any of the functions of the trade mark (Case C-63/97, Deenik): it was an accurate message about the services offered by the defendant, and was not even pleaded. The roundel also appeared on the fascia, which was another matter: and it was on a van, business cards and a banner inside the premises. The "M" logo appeared on the website.

The novel allegations of infringement concerned the fact that Mr Agyeton, the proprietor of the defendant, wore a shirt with the initials "BMW" on it and he or the defendant operated a Twitter account with the handle @TechnosportBMW. That claim did not succeed, but the others did. The fact that the roundel featured on the packaging of parts which were supplied (through the authorised dealer network) to the defendant, as the law requires them to be, made the claim a little more complicated. In addition, promotional items bearing the roundel were provided to dealers as part of the manufacturer's efforts to encourage the sale of genuine parts, and would be passed on to non-authorised dealers, who would pass them on to customers, which further complicated the matter. In the end, however, the judge was satisfied that the average consumer would not understand the roundel on the packaging to indicate that the garage was an authorised repairer. But where the roundel was displayed on or in the premises, the average consumer would assume that this indicated a connection between the garage and BMW, or (if that was not the case) at least it would cause consumers to wonder about the connection.

The use of the roundel also amounted to taking unfair advantage of the reputation of the trade mark (art.9(1)(c)), although that won't have added anything to the remedies (and, being an IPEC case, the amount of damages available was limited anyway).

The use of the "M" device would also have those effects, so that too amounted to an infringement. But the use of the BMW signs conveyed no suggestion that the defendant was an authorised repairer, partly because the evidence provided didn't get BMW far enough, so this line of attack is hardly foreclosed by this judgment.  There is an interesting argument that, because BMW dealers commonly include "BMW" in their business names, the addition of the defendant's name could actually made it seem more like a representation that there was a connection: the judge thought that too subtle for the average consumer, but it should definitely not be discounted in future. A manufacturer might well find a way to make that approach work in their favour.

Where, you might wonder, do the art.12 defences feature in this case? The answer is that the defendant accepted that art.12 added nothing to the defence to the infringement claim, namely that "the defendant's use of the signs was not liable to affect the functions of the Trade Marks.  This was because the signs as used by TLL would in each case have conveyed to the average consumer that TLL was a specialist in the repair and maintenance of BMW vehicles, using genuine BMW spare parts." I expected to see detailed consideration of the "honest practices in industrial and commercial matters" proviso, as in Volvo v Heritage, but the judge wasn't asked to get into that.

Regarding the passing-off claims, these stood or fell with the trade mark claims, and the judge explained the connection between the two which strikes me as an interesting point:
 Had I found that the message conveyed by TLL’s use of its roundel and the M logo signs in each case did no more than render the average consumer unable to determine whether there was an economic link between TLL and BMW, as opposed to causing the average consumer to take the view that there was such a link, on that evidence I would have concluded that there had been no passing off by TLL, see Reed Executive plc v Reed Business Information Ltd [2004] RPC 40, at [111] and Phones 4U Ltd v Phone4U.co.uk.Internet Ltd [2007] RPC 5, at [16].
"Unable to determine" and "caused to wonder" amount to the same thing (so it appears from this judgment), so the test for passing off is somewhat stricter than that for trade mark infringement.

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