Court rules on infringement, bad faith and non-use
The Claimant, the National Guild of Removal Services (NGRS) is a trade body which represents firms and individuals in the removal and storage business. The Defendant, Mr Milner runs a removal and storage business Intransit.
Between September 2008 and November 2010 Mr Milner was a member of the NGRS. His membership entitled him to use the NGRS name and logo in association with his business by way of licence. This included using their logo on his advertisements. In November 2010 Mr Milner's membership with NGRS was terminated but advertisements for Mr Milner's business featuring NGRS's name and logo continued to appear in the 2010/11 editions of the Bath Yellow Pages and the Bath Thomson local directory. This caused NGRS to threaten proceedings against Mr Milner but the issue was settled out of court.
Two further publications appeared one in the 2012-13 edition of the Salisbury Thomson Local Directory and the second on a website set up by BT www.wiltshireremovals4less.co.uk.
NGRS then issued proceedings alleging that Mr Milner had:
- Infringed their trade mark;
- Infringed the copyright in their logo; and
- Passed off his business as being associated with the NGRS by misrepresenting that he was still a member of the NGRS.
The Court dismissed all claims.
In relation to the advert posted in the Directory the Court found Mr Milner had attempted several times to contact Thompson to request the removal of the NGRS logos. Although Mr Milner was asked to provide a new advert which he omitted from doing, the Judge held that this clearly conveyed his want to disassociate himself from NGRS and as such withdraw his consent for Thompson to use the logo.
As regards to the website the Court held that BT was in control of the site and therefore by writing to BT requesting the removal of the NGRS logos from his website Mr Milner had taken appropriate action such that he did not himself do any act of advertising which directly infringed NGRS's trade mark or copyright or which was an act of passing off.
Mr Milner's Counterclaim
Mr Milner contended that four marks owned by NGRS were invalid, two on the grounds that they were registered in bad faith under section 3(6) of the Trade Marks Act 1994 (the Act) and two were liable for revocation for non-use.
Mr Milner contended that at the time of filing its trade mark applications NGRS had intended to use the marks as collective marks, not as trade marks. As a result Mr Milner's position was that the marks were applied for in bad faith., By applying for the logos as trade marks NGRS circumvented the more rigorous scrutiny required to protect the public, in a collective mark application. Thus, Mr Milner argued that the two marks in question should be declared invalid because they were intended to function as collective marks therefore NGRS should not be permitted to use them as trade marks.
Collective marks are defined by section 49 of the Act as: "a mark distinguishing the goods or services of members of the association which is proprietor of the mark from those of other undertakings". In this context an association is construed as a professional body or trade association.
The collective mark serves to identify members of the association and by doing so distinguishes them from traders who are not members. Those members then become authorised to use the association's trade marks and copyright. NGRS is an association and therefore Mr Milner's argument was justified. Mr Milner also submitted that NGRS's marks were vulnerable to an attack of non-use because they had never been used in relation to the goods in the classes they were registered in.
The Judge used two authorities in deciding this issue: Intellectual Property Office (IPO) Practice Amendment Notice PAN 2/01and Scandecor Development AB v Scandecor Marketing AB  UKHL 21. Both authorities seemed to conflict when applied to the circumstances.
PAN 2/01 discusses the IPO's policy regarding applications for trade marks, collective marks and certifications marks. This guidance only addresses IPO policy:
"where a party seeks to apply for both a trade mark and a collective mark, nonetheless if the objections to such concurrent registrations are correct – specifically under s.3(1)(a) and s.3(3)(a) or (b) if the application for the trade mark follows an application for a collective mark – it would seem that those objections should apply if an association applies for a trade mark which will be used as a collective mark, that is to say for distinguishing the goods or services of members of the association from those of other undertakings" (para 58.)
In Scandecor, Lord Nicholl's held that "customers are well used to the practice of licensing of trade marks. When they see goods to which a mark has been affixed, they understand that the goods have been produced either by the owner of the mark or by someone else acting with his consent" (para 38 of the judgement). The Court concurring with this view held that the function of NGRS’s trade marks was to distinguish its members from non-members not function to distinguish between the goods and services of one licensee from another. NGRS's marks were held to be permissible as they did not deceive the public or act contrary to public policy and therefore were lawful. Mr Milner's claim of bad faith failed.
It was held that when NGRS trade marks were used as a badge of membership by licensees of NGRS there was genuine use of those trade marks with the consent of NGRS. Mr Milner did succeed to the extent that some classes were revoked for non-use but ultimately his counter claim failed.
In conclusion all claims against Mr Milner were dismissed on the basis that his actions showed sufficient intention to sever his association with NGRS. Mr Milner's counter claim also failed. The Judge's interpretation of the law and use of authority seemed to be the correct approach to take. This is because the public have an understanding of marks in that they are aware that trade marks are not exclusively used by the proprietor alone. Lastly, ex-licensee's must therefore seek to evidence any intention to disassociate/ remove the licensor's name or logos so in the event the licensor attempts to sue they have a means to protect themselves.
For more information on trade marks, collective marks and infringement please contact the Blake Morgan intellectual property team.
Please follow this link below for the official transcript.