In Enterprise Holdings, Inc v Europcar Group UK Ltd & Anor [2015] EWHC 17 (Ch) (13 January 2015) we have another tour de force from Arnold J. Clocking in it at 227 paragraphs, the decision relates to Enteprise’s claim for trade mark infringement and passing off by its competitor Europcar through use of its “e-moving logo”. Conscious of the length of the judgment, Arnold J made passing note of the parties having treated the matter “as if it were a state trial”.
As with any judgment of Arnold J on trade marks, and regardless of whether you agree with the outcome or not, it is compulsory reading for any student or practitioner in this field. What is particularly impressive and helpful from an advisory perspective is that Arnold J’s decisions allow (dare we say it) for an element of predictability as to the outcome, due to the methodical approach taken in assessing the key factors.
From the Australian and New Zealand perspectives, the structured approach of the judgment and the finding of infringement in part based on a level of acquired distinctiveness in Enterprise’s registered mark will be of interest.
The decision covers myriad issues, including the scope of black & white registrations, the admissibility of and weight to be given to “trade”, expert and survey evidence, and the relevance of foreign consumers residing in the UK (in the passing off context). This note is limited to Arnold J’s consideration of:
- the scope of registered trade mark rights, including a consider of the inherent and acquired distinctiveness of the earlier registered mark (also factoring in the relevance of third party activity and the “state of the register”);
- the relevant points of comparison for device marks;
- the role that evidence of “wrong way round” confusion might play (see our earlier notes on that issue as considered in the Glee case here and here; Glee is scheduled to be before the Court of Appeal in November);
- how the context of the impugned use impacts on the assessment of the likelihood of confusion.
The facts
Enterprise and Europcar are competitors in Europe’s car rental market.
Enterprise owns various registrations for its ‘e’ logo, including CTM ‘497 as shown below left. It has used that mark in various forms since around 2006 (before that it used an e logo in a different format). The use is predominantly made against a green background (shown below right; the coloured mark is the subject of a separate CTM registration but the case for infringement of that mark was stayed).
Europcar launched its e moving logo (below) in late 2012. It was used in three main ways, (i) solus (as shown below), (ii) in combination with descriptors such as “Prestige” or “Chauffer”, and (iii) in combination with the EUROPCAR mark (often also accompanied by the strapline “moving your way”), though in (ii) and (iii) such circumstances the e-moving logo is often larger and sometimes much larger than the other branding.
Against the backdrop of an existing “undercurrent” of confusion prior to Europcar’s adoption of the e-moving logo (due to the Enterprise and Europcar names having a similar length beginning with E and that each uses green branding), Enterprise sued for trade mark infringement and passing off in respect of Europcar’s use of the e-moving logo.
The right formula
Before discussing the key points, it is worth mentioning that Arnold J’s legal analysis begins (as most UK registry and judicial decisions on trade marks do) with an outline of the relevant considerations in assessing the likelihood of confusion. It is set out in full below
114. The Trade Marks Registry has adopted a standard summary of the principles established by these authorities. There are a number of slightly different versions of the summary. The most accurate version, and the one which was cited with approval by Kitchin LJ in Specsavers International Healthcare Ltd v Asda Stores Ltd [2012] EWCA Civ 24, [2012] FSR 19 (“Specsavers (CA I)”) at [52], is as follows:
“(a) the likelihood of confusion must be appreciated globally, taking account of all relevant factors;
(b) the matter must be judged through the eyes of the average consumer of the goods or services in question, who is deemed to be reasonably well informed and reasonably circumspect and observant, but who rarely has the chance to make direct comparisons between marks and must instead rely upon the imperfect picture of them he has kept in his mind, and whose attention varies according to the category of goods or services in question;
(c) the average consumer normally perceives a mark as a whole and does not proceed to analyse its various details;
(d) the visual, aural and conceptual similarities of the marks must normally be assessed by reference to the overall impressions created by the marks bearing in mind their distinctive and dominant components, but it is only when all other components of a complex mark are negligible that it is permissible to make the comparison solely on the basis of the dominant elements;
(e) nevertheless, the overall impression conveyed to the public by a composite trade mark may, in certain circumstances, be dominated by one or more of its components;
(f) and beyond the usual case, where the overall impression created by a mark depends heavily on the dominant features of the mark, it is quite possible that in a particular case an element corresponding to an earlier trade mark may retain an independent distinctive role in a composite mark, without necessarily constituting a dominant element of that mark;
(g) a lesser degree of similarity between the goods or services may be offset by a greater degree of similarity between the marks, and vice versa;
(h) there is a greater likelihood of confusion where the earlier mark has a highly distinctive character, either per se or because of the use that has been made of it;
(i) mere association, in the strict sense that the later mark brings the earlier mark to mind, is not sufficient;
(j) the reputation of a mark does not give grounds for presuming a likelihood of confusion simply because of a likelihood of association in the strict sense; and
(k) if the association between the marks causes the public to wrongly believe that the respective goods [or services] come from the same or economically-linked undertakings, there is a likelihood of confusion.”
115. As I have noted in a number of previous judgments, although this is a convenient summary of the relevant principles, there are cases in which it is necessary to look in more detail at aspects of the Court of Justice’s jurisprudence.
Importantly, this acknowledges the advantages of a structured approach, while cautioning that it might be necessary to dig deeper into the jurisprudence as regards one or more of the factors. This approach is to be applauded.
The scope of a registered trade mark
Arnold J took the structured approach of first assessing the inherent distinctive character of Enterprises’ registered mark, and then considering its enhanced distinctive character through use.
The logo was considered to have a “fairly high” degree of distinctive character:
“Although a lowercase ‘e’ is an extremely commonplace letter, and a letter that is widely used in both descriptive and denominative contexts … it is not widely used in logos to denote providers of vehicle rental services in the UK. Furthermore, 497 has a strong visual identity as a result of the double lines, which are suggestive of a dual carriage road, the extension of the horizontal bar of the ‘e” to the left, the oval shape of the remainder of the ‘e’ and the clear contrast between the ‘e’ and the background”
The acquired distinctive character of the logo was considered by reference to the factors in Windsurfing Chiemsee, namely market share, intensity and geographic spread and longevity of use, promotion and trade evidence. Arnold J was particularly taken by evidence from Mr McCrossan (who had 34 years of experience of the vehicle rental industry in the UK and Europe):
“Undoubtedly the green ‘e’ has a life of its own and in my experience from within the industry it is synonymous with Enterprise. In the field of car rental it is ‘short hand’ for Enterprise – a brand in its own right, much in the same way that McDonald’s ‘M’ is a shorthand for them in the fast food industry.”
It is worth mentioning here that Arnold J dealt cursorily with evidence as to third party “e” registrations tendered by Europcar. This exercise was not carried out by reference to marks that were registered in class 39. In addition, no evidence was provided as to whether the most relevant results were owned by significant competitors in the vehicle rental field. Arnold J accepted Enterprise’s submission that this evidence “does not show that there is common use of lower case ‘e’ trade marks in the vehicle rental sector in the UK” (let alone common use of lower case e logos on a green background).
Comparing device marks
As the respective marks were logos, the principal comparison was visual, but Arnold J also considered that the conceptual comparison had some significance. The aural comparison was of “little relevance”, as the logos are “unlikely to be spoken at all in any normal commercial context”.
Visually, the marks had similarities and differences (based on a side by side comparison). Conceptually, the “Enterprise logo clearly conveys the concept of a lower case ‘e’ styled to resemble a dual carriage road on a green background”, but the Europcar logo did not convey any particular concept. Arnold J wrapped up the point as follows:
“Overall, it seems to me that there is some similarity between the two logos, but not a great deal. The similarity is not such that anyone who was able to compare the two logos would mistake them. Nor would someone who had a clear mental image of one logo be likely to mistake the other for it. But I consider that someone who only had an imperfect recollection of the Enterprise logo, and then saw the Europcar logo, could mistake the latter for the former, at least in the absence of any differentiating context. In particular, someone who recalled the concept of the Enterprise logo as I have described it could, when they saw the e-moving logo, see it as conveying a very similar concept. As is well known, the human eye is not an accurate recorder of detail and has a tendency to see what it expects to see”
“Wrong way round” confusion
How does the law treat confusion that is caused by the reputation of the later mark? The question is incredibly important in the modern economy. A brand can now be launched and become a household name in a matter of days. That brand may well have been launched after the filing date of an earlier registered mark that has not been used at all.
The facts of Glee are a case in point. The registered trade mark owner was a comedy club that owned a registration for THE GLEE CLUB in a logo form. It sued Fox for use of GLEE in respect of its well known television program. Roger Wyand QC, sitting as a Deputy Court judge, considered “that instances of “wrong way round confusion”, i.e. consumers familiar with the defendant’s sign wrongly thinking that the claimant’s services were connected with the defendant as a result of seeing the claimant’s trade mark, constituted evidence of a likelihood of confusion”.
Arnold J considered that it was not necessary to rule on whether the first instance decision in Glee was “an accurate and complete statement of the law”, as there were other factors here that lead to a finding that there was a likelihood of confusion. He was perhaps conscious of the appeal on foot in Glee. He did however note that “even “wrong way round” confusion is capable of being evidence that the e-moving logo is confusingly similar to the Enterprise ‘e’ logo”, and that there was also some evidence of “right way round” confusion, in reaching his finding that the use of the e-moving logo had caused actual consumer confusion.
Context
The assessment of infringement takes into account the “precise context” in which the sign has been used.
Europcar relied on the context (namely that Europcar is a well-established brand and has used Europcar for a long time) as negating a risk of confusion, and Arnold J agreed that the context tended to reduce the likelihood of confusion. However, this was not a “complete panacea” for Europcar:
(a) The context varies between the three categories of use of the e-moving mark made by Europcar ((i) use of e-moving alone, (ii) use in combination with descriptive words like “Prestige”, and (iii) use in combination with Europcar and often the strapline “moving your way”). The context pointed away from a likelihood of confusion in respect of the third category, but this factor was weaker in the overall analysis as regards the second category and its weakest in relation to the first category (solus use).
(b)Even when used together with Europcar, the potential for confusion was not removed. The e-moving logo stands apart from its brand name and strapline. That is, it has an independent distinctive role in Europcar’s branding:
“Europcar uses the e-moving logo as a unifying visual element between its main brand and its various sub-brands. This in itself conveys the message to consumers that the logo links different brands”
Outcome
Arnold J considered that the use of the “e moving logo” infringed Enterprise’s CTM ‘497. He made a global assessment, factoring in the inherent and enhanced distinctive character of Enterprise’s registered mark, the identity of the respective services, a possibly imperfect recollection on the party of the average consumer, and notwithstanding contextual factors (particularly as regards the third category of use). He would have reached the same conclusion as to the first category of use (solus use), but the evidence of actual confusion assisted him in concluding that the second and third categories of use also infringed.
The case for passing off was also made out for “essentially the same reasons” as the infringement case under 9(1)(b). The case under article 9(1)(c) did not succeed, though this was on the assumption (contrary to his finding under 9(1)(b)) that the use of the e-moving logo did not give rise to a likelihood of confusion.
Is the decision relevant in Australia and New Zealand?
From the Australian and New Zealand perspective, Arnold J’s decision raises a number of interesting points.
- Decisions (and for that matter, examination reports) in Australia and New Zealand lack a solid track record of consistency in terms of taking a structured approach to the assessment of the likelihood of confusion. The formulaic approach as adopted by the UKIPO’s registry and approved by the Court of Appeal in Specsavers provides (as Arnold J notes) a convenient summary, provided that it is accepted that aspects of the test might need to be considered in further detail in a given case.
- One common theme in local decisions (particularly Australia) is the lack of consideration that is given to the scope that should be given to the earlier right or rights. It is essential that this point is expressly factored in (as it is in virtually every UK or European trade mark decision issued by a court), otherwise the risk is that the goal that trade mark protection pursues will be lost. The essential function of a trade mark is a concept that is well established in European law, but this policy objective is also noted in recent decisions from Australia’s High Court.
- The case also raises the issue of the relevance of inherent and enhanced distinctive character of the earlier right. This is a bedrock of European law, but remains a point treated inconsistently locally (compare the recent reasoning of Robertson J in adidas v Pacific Brands against that of the Full Federal Court in Henschke). It appears that the point will need to be the matter of a High Court reference before the point is settled in Australia.
Arnold J’s decision can be seen here http://www.bailii.org/ew/cases/EWHC/Ch/2015/17.html. Europcar has sought permission to appeal.
