In 2013, Allergan, Inc. (the "First Plaintiff") and Allergan Singapore Pte Ltd (the "Second Plaintiff")(collectively, the "Plaintiffs") commenced proceedings in the High Court against Ferlandz Nutra Pte Ltd (the "Defendant") for trade mark infringement, passing off and malicious falsehood (Allergan, Inc, v Ferlandz Nutra Pte Ltd [2016] SGHC 131).  

Facts

The product at the heart of this dispute is an eyelash growth enhancer marketed under the brand, Latisse (the "Latisse Product"). The Latisse Product is used in the treatment of a medical condition where a patient has insufficient eyelashes, a condition known as eyelash hypotrichosis. The Latisse Product was marketed under the registered "LATISSE" word mark (the "Latisse Mark") and the unregistered device (the "Latisse Device"). The First Plaintiff is the registered proprietor of the Latisse Mark for pharmaceutical preparations used to treat eyelashes (class 5).  

The Defendant marketed a competing product known as Lassez (the "Lassez Products"), under the following three marks: "LASSEZ" word mark The Plaintiffs alleged trade mark infringement only in respect of the first two Lassez marks (collectively, the "Allegedly Infringing Signs"). The third mark is relevant to the passing off inquiry.

Decision

(i) Whether the Defendant had infringed the Plaintiffs' marks?

The Court found that the Defendant had infringed the Plaintiffs' marks by supplying the Lassez Products to clinics.  

In assessing mark similarity, the Court considered who the "average consumer" in this case was, and whether it should be the notional average consumer, or the average consumer of the parties' actual products. The Court held that it would not be appropriate to allow the particular characteristics of actual purchasers to infiltrate the mark similarity assessment, as the Court of Appeal in the earlier case of Hai Tong3 and Staywell4 had considered this an extraneous factor. Accordingly, the judge should assess mark similarity on an objective basis, and assume the mantle of the notional average consumer and not the unthinking person who is in a hurry. The Court found that the Allegedly Infringing Signs were similar to the Latisse Mark, holding that there was aural and visual similarity. However, as "Latisse" and "Lassez" were both invented and meaningless words, albeit with French nuances, there was no conceptual similarity. 

Although the Lassez mark is registered in relation to cosmetic products (class 3), whilst the Latisse Products are prescription-only-medicine, the Court found that the Lassez Products were a similar type of goods to the Latisse Products. The Court acknowledged that there was an increasing convergence between the cosmetics and medical industries which led to both industries competing for the same group of consumers (at [55] and [109]), and went on to consider other factors to determine if the goods were similar. These factors included the uses, users and trade channels of the goods in question, and the substitutability of the goods (at [56]). On an overall assessment of the facts, the Court found that the Lassez Products were similar to the Latisse Products. This was further reinforced by the fact that the Lassez Product fell squarely within the Latisse Mark's specifications - "pharmaceutical preparations used to treat eyelashes" - as it clearly did not restrict the scope of protection to prescription-only medicine used to treat hypotrichosis (at [63]-[64]). 

There was also a likelihood of confusion amongst the relevant public. The Court held that end-users should form part of the relevant public if there is a risk that they might be led to believe that the competing products are derived from the same or economically-linked undertakings, or if they dealt directly with the products and had to differentiate one product from another (at [75]- [79]). Survey evidence was also heavily relied on by the Plaintiffs, which had engaged an expert to conduct a street intercept survey to assess consumer's perceptions to the Latisse Product and the Lassez Product. Whilst not conclusive of a likelihood of confusion, the Court agreed that the survey evidence indicated that a significant proportion of end-users would be confused by the two products (at [114]). 

(ii) Whether Defendant could rely on the defence of comparative advertising? 

The second category of trade mark infringement involved the Defendant's use of the Latisse Mark in its own advertisements to draw comparisons between the two products. 

To constitute infringement, the Defendant must have used the Latisse Mark in a trade mark sense (i.e. as a badge of origin)5 . As the brochures had expressly referred to the Latisse Product when comparing its efficacy to that of the Lassez Product, the Court found that the Defendant had used the Latisse Mark in the course of trade for a trade mark purpose (at [130]). 

In interpreting section 28(4) of the Trade Marks Act (Cap. 332)("Trade Marks Act")(i.e. the defence of fair use in comparative advertising), the Court adopted the US position and held that the Defendant bore the burden of proving that his use constituted fair use (at [148]). 

However, the Court also distinguished an English authority6 to address the issue of whether the average consumer might find the advertisements misleading, and thereby negate fair use of the Latisse Mark in the brochure (if any). Whilst the Court recognised that it was not the job of trade mark law to regulate and control misleading advertisements, the Court ultimately held that the misleading nature of the brochure brought the Defendant's use of the Latisse Mark outside of the comparative advertising defence (at [163]). Accordingly, the Defendant was also liable for the category of trade mark infringement. 

Flowing from that, the counterclaim for groundless threats naturally fell away. 

(iii) Whether the Defendant had passed off Lassez Products as being connected to / associated with the Plaintiffs?

The Plaintiffs claimed goodwill in both the Latisse Mark and the Latisse Device, which were associated with their business. They proved that there was a substantial market for the Latisse Products by adducing marketing expenditure. Interestingly, the Second Plaintiff justified its seemingly low marketing expenditure (relative to the First Plaintiff's figures) on the basis that it had to limit its marketing activities to medical professionals only, to comply with regulations prohibiting direct-to-consumer advertising. 

As to the element of misrepresentation, the Court found "badges of fraud" in the similarities between the parties trade marks, and between the Defendant's brochure and the Plaintiffs' poster. As the Defendant failed to offer any credible explanations for the striking similarities, the Court inferred that the Defendant had the intention to deceive the public into thinking that the Lassez Product was related to the Latisse Product. Notwithstanding the different product packaging and the huge price disparity, the Court concluded that there was a likelihood of confusion for end-users in the context of passing off. 

Finally, the Court also looked at three heads of damage: (a) damage to goodwill by blurring; (b) damage to goodwill by tarnishment; and (c) restriction on expansion into related fields of activity. The Plaintiff succeeded in showing that there was blurring and a restriction on expansion into related fields of activity, but did not manage to show that there had been tarnishment as there was no evidence that the Lassez Product was of inferior quality to the Latisse Product. 

(iv) Whether there was any malicious falsehood? 

The United States Food and Drug Authority (the "FDA") had sent a letter to the First Plaintiff, a copy of which was obtained by the Defendant and circulated to one of the Second Plaintiff's customers. In the letter, the FDA had requested that the First Plaintiff immediately cease disseminating its promotional materials which the FDA viewed as misleading. The Court found that the FDA letter was not a publication of a false statement, as more than two years had passed since the FDA letter was first issued, and the reasonable person would not assume that the First Plaintiff's promotional materials were still in breach of the law. Nevertheless, the Court went on to find that there was malice on the Defendant's part by publishing the statement, and also that the Defendant's publication of the FDA letter was likely to cause pecuniary damage to the Plaintiffs. 

Comments

This case clarifies the application of section 28(4) of the Trade Marks Act, and shows the Court's openness in considering both US and English cases to interpret the scope of the fair use defence. It also shows that survey evidence, when collected appropriately, can assist to prove to the Court the public's perceptions and point towards a likelihood of confusion or lack thereof.