A recent decision of the High Court provides a useful reminder of the principles involved in deciding whether a stay of proceedings should be granted in respect of English proceedings where there are concurrent actions in the European trade mark registry.

The Dispute

Pinterest, Inc. (Pinterest), operator of the online and mobile social networking platform, is the current user of the mark PINTEREST, having established its business in late 2009. Pinterest has extensively promoted and marketed its services worldwide, with particular emphasis on the UK, through substantial media coverage in newspapers and magazines. On 10 February 2012, Pinterest sought to register a Community trade mark in respect of PINTEREST for various goods and services including, amongst others, “computer software applications” in class 9 and “online social networking services” in class 45.

However, days before on 31 January 2012, AH Innovation Ltd had filed an application for the same mark in relation to classes 41 and 45 in respect of its idea for a news platform, ranking news according to popularity of content, or articles of “premium interest”. The trade mark application was subsequently assigned in early April 2012 to the first defendant, Premium Interest Limited (together Mr Hearn, the sole shareholder and director, and Premium Interest Limited being Premium). At the date of the hearing, Premium had not yet used the sign PINTEREST in the course of trade anywhere in the world.

Both parties brought oppositions in respect of the applications at OHIM, and Pinterest additionally brought a claim in the High Court for passing off against Premium.

The Hearing

The hearing was on applications made by both parties, but in particular centred on Premium’s application that the English proceedings should be stayed pending the final determination of the Community trade mark applications.  It was clear that there was a common issue between the two sets of proceedings, namely, did Pinterest have protectable goodwill in the trade mark PINTEREST in the UK as at 31 January 2012 so as to entitle Pinterest to restrain Premium’s use in relation to the services as set out in Premium’s application on the ground of passing off? 

Premium based their application on the following key points:

  • having previously offered to Pinterest an undertaking not to use PINTEREST in the course of trade in relation to any of the services covered by their application unless and until the application proceeded to registration, Premium argued that the proceedings would be unnecessary if Pinterest was successful in its Opposition, as Premium would likely change their plans and therefore costs would be wasted.
  • Premium would be prejudiced if there was no stay, because they are less able to afford the expense of the English court proceedings than Pinterest, whereas the Opposition proceedings were a more economical and proportionate means of dealing with the dispute.
  • Pinterest would not be prejudiced by a stay, which Premium argued was supported by the fact that the Opposition proceedings commenced over two years before the English court proceedings, and that previous correspondence suggested that – prior to any (adverse) OHIM decision – Pinterest was content for the issue to be determined by OHIM.

Pinterest disputed these points, noting that the Opposition proceedings would not necessarily cost less, taking into account the possibility of the various appeals. Furthermore, Pinterest noted the risk of commercial uncertainty, which was worsened by the disparity in the expected duration in the two sets of proceedings (the first decision in the English court proceedings would be available in around nine months and a Court of Appeal decision around a year later, where the Opposition proceedings would not be concluded for seven years given the further four instances open for appeal).

The Decision

In its decision, the Court provided a succinct summary of the principles applicable to application of this nature, as previously reviewed by the Court of Appeal inIPCom GmbH & Co KG v HTC Europe Co Ltd [2013] EWCA Civ 1496 in relation to concurrent patent proceedings:

  • the discretion, which belongs to the court of first instance, should be exercised to achieve the balance of justice between the parties, having regard to all the relevant circumstances, bearing in mind the any legislation which provides the context and condition of the exercise of the discretion.
  • the possibility of concurrent proceedings contesting the validity of a registration granted is inherent in the registration system, and it should be remembered that national courts exercise exclusive jurisdiction on infringement issues.
  • although where there are no other factors, a stay of the national proceedings is the default option, the question is ultimately where the balance of justice lies.
  • important factors to take account of include:
    1. whether refusal of a stay will irrevocably deprive a party of any part of the benefit which the concurrent jurisdiction of the national court is intended to confer;
    2. whether commercial certainty would be achieved at a considerably earlier date in the English court proceedings;
    3. whether deciding some important issues may promote settlement;
    4. the length of time it will take for the respective proceedings in the national court and European registry to reach a conclusion;
    5. public interest in dispelling the commercial uncertainty; and
    6. risk of waste costs.

Taking into account all these factors, the Court declined to grant a stay of the English court proceedings.

Although the Court admitted that it would be inherently undesirable for the same issue to be litigated between the same parties in two different tribunals, with the consequent risk of wasted costs, these concerns were outweighed by the fact that allowing the English proceedings to continue would mean commercial certainty could be reached much sooner than in the OHIM proceedings, and potentially promote wider settlement between the parties.

This decision provides a useful reminder of the principles the Court applies in considering whether to grant a stay of proceedings pending resolution of concurrent European registry proceedings. Even where there is a risk of inconsistency between decisions, and potential for wasted costs, commercial certainty can be a crucial matter, particularly where granting the stay could lead to parties waiting years for a conclusive decision.