Comparable trade marks, pre-Brexit use and EU trade marks as earlier rights

Having spent time today delving into some more of the darker corners of the changes to intellectual property law that Brexit has foisted on us, and also having had an e-mail conversation with a friend in the EU who told me he had been surprised when his clients received a bunch of unasked-for comparable trade marks from the UK registry at the turn of the year, I have a few things to say about trade marks today.

Comparable trade marks are the oddly-named UK trade marks that were spawned by EU trade marks on IP completion day, which was 11 pm on 31 December 2020. Calling a precise time such as 11 pm a "day" is a relatively innocent form of Newspeak, which it's no longer surprising to hear coming from our government. The reason the day in question started at 11 pm rather than midnight, as most days do, was simply that it was midnight in most of the EU, which doesn't seem to me to be a particularly good reason given that it wasn't the rest of the EU that was undergoing radical change at that moment (significant change, but short of radical) and hardly smacks of "taking back control". We'll take back control, but at a time to suit you.

Anyway, I digress, as usual. These new-fangled comparable trade marks (which come in two flavours, EU and International, depending on how the parent EU trade mark came into existence) look deceptively simple. They are, to all intents and purposes, UK trade marks and treated in exactly the same way under the Trade Marks Act 1994 - in most respects. They are instantly recognisable (if you need to recognise them) by their numbers: a prefix, UK009, is tacked on to the parent's EU registration number. A neat solution, although it leaves a lot of gaps in the register. (I wonder whether the IPO will triumphantly announce a ten-fold increase in new trade mark registrations in 2021?)

But go a little deeper and comparables get a lot more complicated. I want to consider two points here (because trying to do more would make this post too long and boring): will a comparable derived from an EU trade mark that hasn't been used in the UK in the past five years be instantly vulnerable to revocation for non-use; and how will an application for a declaration of invalidity play out where the earlier rights against which a UK trade mark is allegedly invalid were an EU trade mark?

The answer to the second question first, and I have just realised that there are in fact two elements to it. Will that EU trade mark still be an earlier right, and if not will its comparable stand in its metaphorical shoes? The answers seem to be no, and yes. The EU trade mark lost its status as an earlier right on the stroke of 11 that night, but the baton passed to its comparable which inherited all the vital statistics of its parent, including priority and seniority dates. So the conflict still has to be resolved, although presumably some trade mark litigators have been obliged to do some nifty footwork to substitute the comparable for the parent EU trade mark.

This is all buried in the Trade Marks (Amendment etc.) (EU Exit) Regulations 2019 (SI 2019/269), 28 pages of amendments many of which make little sense unless you have the Trade Marks Act open beside you. (Incidentally, the IPO has helpfully published an unofficial consolidation of the TMA with all these changes in it - though I wonder how it can be called "unofficial" when the office has produced it.) This change is one of those effected by Schedule 1, which (confusingly, to me anyway) inserts a new schedule 2A into the 1994 Act with all this good stuff in it.

As for the question of use or non-use, that is dealt with by stipulating that the use made of the parent EU trade mark is credited to the account of the comparable. That is logical, up to a point, because the comparable has inherited the priority and seniority of the comparable, so it's right to say that any use in the UK needs to be considered as use of the comparable in the UK. But that leaves a problem: what if the parent EU trade mark hadn't been used in the UK prior to IP completion day, but elsewhere in the EU? In that situation, the government says, it would be unfair and an unintended consequence to say that you are creating a new trade mark that is born with five years' non-use baked into it, so use of the parent EU trade mark anywhere in the EU will save it, which to a tiny but discernible extent negates the whole idea of leaving the EU.

Use of TM in one Member State might be enough - but not necessarily

The long-awaited decision in the Onel case,  Case C-149/11, was handed down today by the Court of Justice (note: not "the Court of Justice of the European Union", which is the collective name for the two-tier judicial organ of the Union, and even more not the "European Court of Justice") and contains no great surprises. The judges have slightly diluted the Advocate General's opinion, that's all: and the decision acknowledges that use of a Community trade mark (note: not a Union trade mark - does anyone know why?) in a single Member State will count as "use in the European Union", as required by the Community trade mark regulation.

Of course, it is not the job of the Court of Justice to decide anything remotely factual, so it is limited to telling us what might be, whereas we might like to know what actually is. Is the ruling a sound communitaire one? It certainly looks like it at first sight. But I think it fails any useful test of such soundness. Bear with me ...

If the only way to protect a trade mark were to register it in the Community system, it would be absurd to say that it had to be used in (say) more than a single Member State (even dafter to insist it were used in all of them, of course). But that isn't the way things work. You can get protection in a single Member State if that's what you want, or need - or in two, or three, and so on. Of course, at about that point a Community trade mark becomes better value, but the cost is not the important thing here. To my mind, a Community trade mark, to be worthy of the name, must be used (or the proprietor must intend to use it) throughout the European Union: and if the proprietor intends to use only in a few countries, it should get national trade marks in those countries. It's not like a trade mark used only in Scotland, for example: there, the owner can't get protection in the territory of interest to it without also getting the rest of the UK (pending a referendum on Scottish independence, of course).

Any other approach simply causes dreadful, anticompetitive and chilling cluttering, and in a rational system should be prevented at all costs. It also seems to me to offend the basic principles of federalism - which may be irrelevant, given that the EU is not a federation - but this approach does not take us any closer to being one, and anyway principles of federalism can still inform aspects of the development of the Union.

Comments?

Informal licences and oral use of trade marks

Prudent trade mark owners don't let others use their trade marks without taking precautions, but in Jean Christian Perfumes Ltd & Anor v Thakrar (t/a Brand Distributor or Brand Distributors Ltd) [2011] EWHC 1383 (Ch) the High Court (Mr John Baldwin QC, sitting as a deputy judge of the Chancery Division) held that even where the licence had been granted orally the licensee could bring an action for infringement if he had the consent of the proprietor.

The case concerned a Community trade mark: there is no reason to suggest that a UK trade mark would be treated any differently. This ruling could be very useful where the proprietor of the trade mark is overseas and might therefore be required to give security for costs before being able to sue for infringement. A licensee using the trade mark here, even without a formal written licence, could bring the action instead.

There was also a point in the case about whether non-graphic use of a trade mark could be infringement. The deputy judge observed that as the Community trade mark regulation provides for the registration of such exotic, non-graphic, marks as sounds, it would be absurd if oral use were not capable of being an infringement. I have always understood that the 1994 Act widened the scope of what amounts to infringement to include oral use, although I believe it's not expressly stated on the face of the statute - it's just that the Act doesn't say infringing uses have to be graphic. And quite right too: mention of a trade mark in a TV or radio programme should, if the relevant conditions are met, amount to an infringement.

The logical extension of these principles is that oral use of a trade mark will be enough to overcome a claim of non-use. Just hard to prove.