In a decision handed down this afternoon by the Court of Appeal in Roger Maier and Assos of Switzerland SA –v- ASOS plc and ASOS.com Limited, the Court decided that the use of the brand "ASOS" by the Defendants created a likelihood of confusion and damaged the distinctive character of the ASSOS registered trade mark. However by a majority of two to one, the Lord Justices held that the defendants could rely on the "own name" defence to trade mark infringement. In a lengthy dissenting judgment, Lord Justice Sales, disagreed with the application of the defence stating that the difference between his view and that of the majority was that he considered greater weight should be given to the rights of the trade mark owner and the protection of the interests of the relevant public.
The Claimants in this action were the owners of the successful ASSOS cycling clothes business. They had registered a Community Trade Mark ("CTM") in 2005 for the mark "ASSOS" in respect of, among other things, clothing, footwear and headgear. The Claimants brought trade mark infringement proceedings against ASOS plc in respect of the use of ASOS by the defendants on its clothing retail website, www.asos.com as well as on own brand clothing. ASOS plc had originally been called "As Seen on Screen" but had changed their name to the acronym ASOS in the early to mid-2000s.
The Defendants argued there was no infringement and relied on a number of defences including the "own name" defence. They also counterclaimed to revoke the CTM for non-use and argued the CTM was invalid on the basis of the Defendants' prior rights.
At first instance Mrs Justice Rose, in a Judgment dated 19 September 2013, decided that:
"(i) The CTM be partially revoked to cover "Specialist clothing for racing cyclists; jackets, t-shirts, polo shirts, track-suit tops, track-suit bottoms, casual shorts, caps""
(ii) The invalidity attack against the CTM based on the Defendants' alleged earlier rights failed
(iii) There was no likelihood of confusion between the use of "asos" and the CTM.
(iv) There was no damage to the distinctive character of the CTM through the use made by the Defendants
(v) As the Judge had decided there was no infringement, she decided it was unnecessary to decide the question of whether the "own name" defence applied.
Both parties appealled and the appeal was heard in November 2014.
In the decision handed down today, the Court of Appeal overturned the Judge's decision on likelihood of confusion and damage to distinctive character. They were unanimous in finding that the Judge had fallen into error by only considering the likelihood of confusion with respect to the actual use made of the trade mark by the Claimant and not with the notional and fair use of the mark across the breadth of the specification (even once partially revoked).
The Lord Justices noted that there was no significant "actual confusion" but that this did not affect their findings as the parties had been trading clothes through different outlets (one via cycling shops, the other via an online website).
As regards damage to distinctive character they found that "the ability of the mark ASSOS to identify at least some of the goods for which it is registered as being the goods of Assos has, in some circumstances amounting to a normal and fair use of that mark, been weakened"
The Court was however split on the question of:
"(i) The extent to which the trade mark specification should be revoked; and"
(ii) The application of the own name defence.
The majority (Lord Justices Kitchin and Underhill), held that with the exception of the deletion of "racing", the goods covered by the mark should be as found by the Judge. The alternative requested by the Claimants – "specialist clothing for cyclists and casual clothing" was rejected. "Casual clothing" was too broad a category to be supported by the use proved and that the list – "jackets, t-shirts, polo shirts, track-suit tops, track-suit bottoms, casual shorts, caps" was therefore appropriate.
In a dissenting judgment Lord Justice Sales held that the category "casual clothing" was appropriate as it was the smallest category which encompassed the selection of items on which use had been proved. It was unduly restrictive on the rights of the trade mark proprietor to list the goods on which use had been proved.
As regards the "own name" defence the Lord Justices in the majority held that the following facts were relevant:
- the name "asos" had been adopted innocently by the Defendants as it was an acronym of their previous name "As Seen on Screen" and it was never their intention to confuse the public;
- when adopting the brand the Defendant had done a Google search for "asos" but had not conducted any trade mark searches;
- there had been no significant evidence of "actual confusion";
- the Defendants' had purchased "assos" as a keyword after they had become aware of the CTM (and this had stopped prior to Trial);
- the Defendants' had sold cycling clothing on its website after becoming aware of the CTM (and this had stopped prior to Trial); and
- the Defendants had adopted a logo that was closer in style to the logo used for the CTM.
They decided on balance that the Defendants had fulfilled their duty to act fairly in relation to the Claimants' legitimate interests and had not conducted their business so as unfairly to compete with the Claimants. As a result the "own name" defence applied.
In his dissenting Judgment Lord Justice Sales considered the own name defence should not be available to Asos. He considered that the recitals to the CTMR place more emphasis on the rights of the trade mark proprietor and the interests of the public in not being confused. There was no corresponding reference in the recitals to the weight to be afforded to the ability to use one's own name for marketing purposes.
He went on to place particular weight on the fact that the Defendants had not conducted reasonable checks whether ASOS was already being used by a third party to market goods of the same type. This type of check would be expected under "honest practices". Sales LJ also relied on the Defendants having expanded their business (including to a number of countries across Europe) after becoming aware of the existence of the CTM.
The Claimants intend to seek leave to appeal to the Supreme Court on the application of the own name defence.