The team is joined by Guest Kats Rosie Burbidge, Stephen Jones, Mathilde Parvis, and Eibhlin Vardy, and by InternKats Verónica Rodríguez Arguijo, Hayleigh Bosher, Tian Lu and Cecilia Sbrolli.

Saturday, 24 December 2016

A TITANIC trade mark dispute

With such a large cast of characters 
the case got off to a flying start
It has been nearly 20 years since Titanic hit cinemas worldwide and slightly more than 100 since the eponymous ocean liner hit an iceberg.
Despite these somewhat mixed associations, many businesses have sought to use the Titanic name for products and services ranging from spas to property developments.

In one recent instance this has led to High Court proceedings: Property Renaissance Ltd (t/a Titanic Spa) v Stanley Dock Hotel Ltd (t/a Titanic Hotel Liverpool) & Ors [2016] EWHC 3103.

Dramatis personae
  1. Titanic Spa (Property Renaissance Ltd) - a luxury spa business which opened in 2005, offers overnight accommodation and had a turnover in 2015 of £4.8 million. On 16 April 2011, it registered TITANIC SPA in the UK in classes 35, 41, 43 and 44.
  2. Titanic Liverpool (Stanley Dock Hotel Ltd & Stanley Dock Properties Ltd) - operators of the Titanic Hotel Liverpool which opened in June 2014.  From February 2014, publicity materials referred to the Titanic Hotel having a spa. This was initially known as the "T-Spa", in December 2014 it was rebranded as "the Spa" and from April 2016 it was renamed Maya Blue Spa. The hotel operates under a licence from 
  3. Titanic Belfast (Titanic Trademark Ltd & Titanic Quarter Ltd) - the companies behind The Titanic Quarter in Belfast and owners of two trade marks which include the words TITANIC QUARTER one of which predates the TITANIC SPA mark. The Titanic Quarter is (appropriately) the biggest property development scheme ever undertaken in Northern Ireland and is one of Europe's largest regeneration schemes.
The Titanic Quarter, Belfast
How many parallel proceedings?

Titanic Spa objected to Titanic Liverpool's use of Titanic.  This led to the following parallel sets of proceedings.
  1. The High Court Appeal - This was an appeal against the UK IPO's decision dated 8 March 2016 to cancel Titanic Belfast's UK word mark for TITANIC QUARTER for non-use.
  2. IPEC claim - Brought by Titanic Spa against Titanic Liverpool.
  3. The High Court claim - issued in July 2016 by Titanic Liverpool and Titanic Belfast against Titanic Spa.  In addition to the UK mark, this claim also alleged infringement of an EU device mark
With such a TITANIC number of related disputes, this was scaling up to be a dramatic trade mark dispute.  Would an iceberg hit either party or would they be able to survive the chilly waters of the High Court on a wooden door?

The judge, Henry Carr has slightly loftier Titanic quotations to offer in his judgment at [11].  As he noted both sides want to stop the other from using the word "Titanic".  As he put it "both sides have valuable businesses, and this is very high risk litigation which puts in jeopardy the goodwill which Titanic Spa and Titanic Liverpool have built up."

Will the TITANIC QUARTER trade mark break in half?
The scene is now set - it's time to consider the issues.

Should the Hearing Officer have declined to consider late evidence of use filed by the trade mark holder in the UK IPO invalidity action?

In short, the judge decided that this late evidence should have been allowed in because:

(a) It was accepted that the evidence of use would enable the TITANIC QUARTER word mark to survive in, at least, part.  Therefore it was "highly material" evidence.  Thfor its exclusion.
(b) The Hearing Officer incorrectly characterised counsel's submissions regarding the impact of refusing this late evidence.
(c) Although the hearing officer was only given the evidence on the day of the hearing she had the opportunity to consider it in her reserved judgment.
(d) The Hearing Officer only considered the prejudice that the new evidence would cause to Titanic Spa but not the "very significant prejudice" to Titanic Liverpool.  This was unfair. The prejudice to Titanic Liverpool in losing a valuable trade mark was greater than the prejudice to Titanic Huddersfield in receiving the evidence very late in the proceedings.
(e) The overriding objective applies to proceedings before the Registrar including the obligation to deal with cases justly.
(f) The evidence would not have caused an adjournment.
(g) The evidence was clearly presented and easy to follow (albeit 15 pages long). 
NB as the test for admitting new evidence on appeal is much higher, if Carr J had not permitted the evidence of use on the basis that Hearing Officer had erred at first instance, it would not have been allowed in on appeal.

As a result of the new evidence being added, the TITANIC word mark was restored to the register and the specification amended in accordance with the evidence of use following Stichting BDO v BDO Unibank [2013] EWHC 418 (ch) at [51].  In essence it is a balance between (a) allowing a trade mark owner to maintain broad protection to a large category of goods when its use is confined to a particular sub-set of goods; and (b) removing protection for sub-sets of goods which the average consumer would consider to be substantially the same as the goods for which the mark has actually been used.

After a thorough review, the specification was not amended.  As Carr J noted the late evidence was crucial to reaching this decision.

It was back to the original Titanic ship Quarter trade mark 
What about Titanic Spa's infringement claim?

The TITANIC QUARTER mark may have survived the arctic conditions of the Rolls Building but would that protect Titanic Liverpool from Titanic Spa's infringement claim?  SPOILER ALERT: no.

Carr J held that TITANIC SPA is a composite mark (in other words, the word "spa" was an important part of the mark).  However, he went on to note that "it is common for hotels to have spas" so there is clear conceptual similarity between "Titanic Spa" and "Titanic Hotel" and the average consumer might therefore believe that goods or services provided under those names come from economically linked undertakings.  Given that the Titanic Hotel offered identical or highly similar services to Titanic Spa, the judge held that Titanic Liverpool and Titanic Hotel both infringed the TITANIC SPA mark.

Although most of the evidence of confusion was "wrong way round" (i.e. people contacting Titanic Spa believing it was Titanic Liverpool) the judge considered that the Titanic Hotel's use of the word "spa" to describe its health facilities contributed to the confusion and noted that since the spa's rebrand to "Maya Blue", instances of confusion had "decreased very substantially".  Somewhat controversially, in order to minimise this "wrong way round" confusion the judge, suggested that Titanic Spa (the trade mark holder) should have added a disclaimer to its website to make it clear that it was not connected to Titanic Liverpool.  Titanic Spa was understandably reluctant to "advertise its rival".

What's in a name? That which we call a rose... "
(sorry, wrong Leo film)
Own name defence?

Titanic Liverpool was unable to rely on the own name defence (Section 11(2) Trade Marks Act 1994).  Cipriani v Cipriani [2008] EWHC 3032 (Ch) established the following principles:

  1. is the use in accordance with honest practices (inc. a duty to act fairly re the trade mark owner's interests)?
  2. all the circumstances should be considered, including whether the defendant is unfairly competing with the trade mark owner?
  3. does the use give rise to consumer deception, take unfair advantage or cause detriment?
  4. is there a good reason to tolerate the confusion?
  5. was the defendant aware of the substantial confusion/deception?
When applying these principles, the judge found that:
  1. Titanic Liverpool did not choose its name with an intention to confuse the public.
  2. Titanic Belfast had built up a strong reputation in TITANIC QUARTER which pre-dated Titanic Spa's trade mark.  However, Titanic Spa's trade mark pre-dated Titanic Liverpool.
  3. Titanic Liverpool was a natural brand extension given the history of RMS Titanic and its connection to Liverpool.
  4. Titanic Spa's primary purpose is an eco-spa with hotel facilities whereas Titanic Liverpool is a hotel with a spa.  However, whilst there is a slightly different overlap, the similarity is clear.
  5. Titanic Liverpool had taken steps to minimise confusion - starting with the rebrand to T-Spa and then to Maya Blue.  However, there was evidence of actual confusion.
  6. Titanic Liverpool had offered to provide a disclaimer on its website with a link to Titanic Spa's website and to remove all use of the word "spa" replacing it with the more wordy "health and fitness centre".
  7. Titanic Spa's business was going extremely well (i.e. there was no evidence of damage).
  8. Titanic Belfast was aware of the Titanic Spa mark from 2011.
Although he did not consider it an easy decision, the judge ultimately decided that the own name defence should not succeed because (1) there was evidence of actual confusion and (2) the steps taken to minimise confusion were made fairly late in the day.  However, if Titanic Liverpool did add a disclaimer to its website including a link to Titanic Spa's website and stopped using the word spa in connection with the hotel (i.e. the terms proposed by Titanic Liverpool), the own name defence would succeed in the future.  

I figure trade marks are a gift and 
I don't intend on wasting it"
Leo Titanic Belfast may have said
Did Titanic Spa infringe?

Titanic Belfast alleged infringement of its TITANIC QUARTER mark.  This was largely advanced as a squeeze against Titanic Spa.  It failed because the judge considered TITANIC SPA and TITANIC QUARTER as composite marks and noted that although there was some similarity in the word "Titanic", the meanings were different (i.e. business with spa facilities vs geographical area).

Passing off?

Carr J applied the classic trinity to the facts and found that:

  1. Titanic Spa had acquired goodwill in the name "Titanic Spa" in relation to spa services with temporary accommodation but NOT in the name "Titanic" alone.  
  2. Before the rebrand to Maya Blue, there was a misrepresentation by Titanic Liverpool. 
  3. Although most confusion was "wrong way round" there could still be damage to Titanic Spa e.g. from customers who were frustrated that they had made a reservation at the wrong place. 

If Titanic Liverpool took the steps required for the own name defence to apply, it could also avoid passing off in the future.

I do declare...

Given the somewhat dramatic history of the action, the judge granted Titanic Liverpool and Titanic Belfast's requests for a declaration that they are legitimately entitled to use the signs "Titanic Quarter" and "Titanic Quarter Hotel Liverpool" as well as the device mark (see right) in relation to hotels in the UK.

Will the heart of the dispute go on and on to the Court of Appeal?  Perhaps they have already said: "Promise me you will survive....that you will never give up...not matter what happens...no matter how hopeless..."  

1 comment:

Anonymous said...

As described in the decision, the "Titanic" in Titanic Spa refers to the "Titanic Mills" building in Huddersfield, which was probably not named in any reference to the ocean liner.

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