For the half-year to 31 December 2014, the IPKat's regular team is supplemented by contributions from guest bloggers Rebecca Gulbul, Lucas Michels and Marie-Andrée Weiss.

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Tuesday, 6 November 2012

Still bitter: the lingering taste of Chocosuisse

Ready for a litigation
meltdown ...
"Still feeling the pain!" was the exclamation of much-respected IP litigator Tony Willoughby when he spotted the reference in yesterday's katpost, "Culture clash: Greek yoghurt keeps out Americans, for now" to the celebrated Chocosuisse case.  The reference also sparked off the following reminiscences, which the IPKat is delighted to post for the delectation and close attention of young and aspiring litigators in the dangerous area of extended passing off:
"You make reference to the Chocosuisse and Vodkat cases. I represented the defendant in the former (and lost) and the plaintiff in the latter (and won). 
The Chocosuisse result came as a terrible shock. I remember sitting with my wife relaxing in the heart of the Highlands north of Balmoral when the call came through from Michael Bloch, our counsel. When he told me that we had lost on every single point I could not believe it. We knew that we had won. Following the trial Simon Thorley’s clerk (acting for the successful plaintiff) had even called to congratulate me on our victory. Getting that call from Michael was probably the worst moment of my career. I was supposed to be an expert in this area of the law … and I lost. How could it be?

When I first qualified I joined the Trade Marks Department of The Distillers Company (now part of Diageo). At that time the Scotch Whisky Association (“SWA”) had no legal department and we did all their extended passing off work. It represented a large chunk of my workload. I had two amazing bosses, Norman Kirke and Bill Bryce, who taught me most of what I know. Their mantra was “you get out of a passing off action what you are prepared to put into it.” Get the evidence and you will win.

In Chocosuisse my team and I collected more evidence than I have ever collected in a case. All of it was good very solid stuff (apart from a survey conducted in Birmingham, which was thought to be too close to Bournville [katnote for young chocolate eaters: Bournville is the historical epicentre of a former jewel in the British chocolate crown, Cadbury, now owned by Mondelez]). The vast majority of people knew Cadbury as an iconic English brand. They appreciated that Swiss Chalet (a Toblerone-type product) was an English product forming part of a range of other English products including Black Forest (cherry flavoured), Old Jamaica (rum flavoured), Grand Seville (orange flavoured) and of course Turkish Delight.

What went wrong? Basically, the answer is very simple. As a defendant it doesn’t matter how many people you can prove won’t be deceived if the plaintiff is able to prove that some (and more than a de minimis number) will be deceived. Even a figure as low as 6% of supermarket shoppers represents a very substantial number of people, so proving that 94% of consumers won’t be deceived may well not be enough if the remaining 6% are coherent and convincing. We believed that the risk of consumer deception was trivial, but failed to convince the judge.

At the date of Chocosuisse I had been representing the SWA for over 25 years and throughout that period all their lawyers (in-house and external) had been stressing that, if a member company did the very things that the defendant was accused of, there would be a severe risk that the court would deny the injunctive relief sought. Unclean hands (see White Horse v Gregson in the mid-1990s in which one of the plaintiffs was required to explain itself). One of the strictures was that no member of the SWA should use for a non-Scotch whisky the same brand name that it used for a Scotch whisky. To do so would be bound to put at risk the distinctiveness of the whole class. If you went overseas and ordered a “Johnnie Walker” for example, you would expect to be given a Scotch whisky not a French whisky. If a practice of that kind (using a famous Scotch whisky brand for another type of whisky) became widespread, the goodwill associated with Scotch whisky would be bound to suffer.

In Chocosuisse we were able to prove that, for many years, all ‘Swiss Chocolate’ Easter eggs had to be made in England because they were too fragile to travel. And blow me down, one of those English-made Easter eggs was branded “Swiss Chalet”. We were also able to prove – and I believe it to be the case today – that a very high proportion of the chocolate sold in the UK and emanating from the premier Swiss brands (e.g. Lindt) is manufactured in France, Germany and Italy and notwithstanding numerous references on the labels to “Swiss chocolatiers” and Swiss guarantees.

None of that had any effect on the court and that is one aspect of the case that I have never really understood. Chocosuisse had no standing in a passing off action as a non-trader and most if not all of the other plaintiffs had sold chocolate not made in Switzerland under and by reference to their world famous Swiss chocolate brand names, which seemed to me to act as geographical identifiers in exactly the same way as the word “Swiss”. Much of our evidence was devoted to proving that if you showed a Lindt Excellence chocolate bar to consumers, it was thought to be Swiss chocolate irrespective of where it was made.

I know from subsequent conversations with the judge that he regarded the extended form passing off action as being more of a civil form of the Trade Descriptions Act, the objective being to protect the public from mis-description, in which case any wrongdoings of the plaintiff should not prevent the grant of an injunction to address the wrongdoing of the defendant.

I’m very glad that I had the opportunity to salvage something of my reputation in the field with Vodkat, but, evidentially, that was a very different case and, significantly, I had the distinct advantage of acting for the plaintiff".
Thanks, Tony. Some of us who like to think of ourselves as IP purists feel the pain with you.

3 comments:

Andy J said...

The mention of Johnny Walker gives me an excellent opportunity to post a link to this video with its impressive videography and thespian skills. Courtesy of Jenni Falconer's website. Apologies to the Kats for going off topic.

Francis Davey said...

My first date with the person who is now my wife was to the Bournville Factory (or at least the Cadburys visitor centre) and it was there I was first introduced to Swiss Chalet. At the time I was a still a computer scientist and so had no idea that disputes over bars of chocolate might feature in my future. I remember our sadness that the product was withdrawn.

Anonymous said...

My first experience of Tony Willoughby (but not Cadbury's chocolate or even vodka) was about 20 years ago when he was a partner at Herbert Smith and I occupied the office accross the corridor from him; he had a larger desk and he had more windows than I did (which anyway I had to share with Yvonne Harvey). When it came to trade marks and passing off he was the consumate professional. He still is. He had a way of persuading potential infringers to stop immediately and I still remember the oft repeated words "the problem is that once these things get started then they can be difficult and costly to stop."

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