What do you do when a defendant fails to participate in proceedings relating to an account of profit for trade mark infringement? Rely upon uncontested evidence and raise a glass of celebratory champagne of course!
The recent High Court decision of Champagne Louis Roederer (CLR) v J Garcia Carrion SA & Others  EWHC 289 (Ch) has a number of quirks in its factual matrix. The dispute involves a claim for infringement of Roederer's UK and CTMs for the word CRISTAL. The Defendant, JGC, described as a very substantial Spanish producer of wines and other beverages, had previously been found liable for trade mark infringement in relation to its cava marketed and sold under the name "Cristalino" (see previous IPKat post here).
|JGC's profits - not Cristal clear|
Given the vacuum of material from JGC, Roederer's legal team pieced together evidence concerning JGC's likely profits from a number of sources. These included material from proceedings in the Commercial Court in Brussels, the UK IPO, the US District Court of Minnesota, and also from Asda and Morrison's supermarkets who had supplied the infringing product in the UK (Asda and Morrison are Defendants in these proceedings but settled the dispute with Roederer). Roederer elected to have an account of JGC's profits. Roederer submitted expert evidence from an accounting expert in addition to the source materials.
Issues before the Court
In assessing JGC's profits, the Court considered the following issues:
|Cristal - created for Tsar Alexander II|
2. Determination of profit obtained by JGC as result of infringing sales
In determining JGC's likely gross profit, the Court relied upon (confidential) evidence from the Minnesota proceedings. The Court noted that JGC had only itself to blame if the very limited evidence put forward by Roederer turned out to be inaccurate. Roederer's evidence was unchallenged and accepted by the Court. There was no deduction of JGC's gross profits to reflect overheads attributable to the infringing activity. Given that the burden of proving that relevant overhead are attributable to the infringing activity lies with the infringer, the Court concluded that there was no basis upon which it could make such an allocation. Further, and following on from the decision in Jack Wills Ltd v House of Fraser Stores Ltd  EWHC 626, the Court refused to make any deduction to JGC's profits in relation cases where the infringement did not 'drive' the sale - there was no evidence to sustain a finding that sales had been driven by factors other than infringement. JGC's profits derived from infringement were assessed at €1,332,844.64.