The Intellectual Property Enterprise Court has delivered a judgment [1] that both highlights the importance of passing off and clarifies the meaning of "genuine use" of a Community trade mark.

The claimant, Sofa Workshop, who is a subsidiary of DFS, carried on business as a sofa retailer under the trading name "Sofa Workshop". The defendant was also a sofa retailer, and carried on business under the name "Sofaworks". Sofa Worskhop was the registered proprietor of two Community trade marks for the mark SOFA WORKSHOP.

Sofa Workshop brought proceedings for trade mark infringement and passing off. In its defence, Sofaworks argued that the trade marks were invalid as they were descriptive and lacked distinctive character and that, even if they were valid, they should be revoked on the basis that there had been no genuine use of the marks in the European Community.

It was held that the marks were invalid. Further, even if they had been valid it was found that they would have been liable for non genuine use in the European Community. However, Sofaworks was found to be liable for passing off. So, even though it lost both of its marks, Sofa Workshop's action was ultimately successful.

Validity of the marks

There was evidence that "sofa workshop" was a term used descriptively in the trade and, as such, the marks consisted of signs that served to designate a characteristic of some of the goods for which the marks were registered. The marks were therefore found to have been invalidly registered. Further, it was found that the marks had not acquired distinctiveness through use. Sofa Workshop was required to show that the marks had become distinctive in non-English speaking countries as well as English-speaking countries and there was insufficient evidence to support a finding that it had done so.

Revocation for non-use

It was held that for there to be genuine use of a Community trade mark there must be genuine use in more than one Member State and potentially, depending on the size of the market in question, more than two Member States. The only exception to this requirement would be where the market for the goods or services in question was restricted to the territory of a single Member State.

This could prove to be a controversial statement of the law. The Court of Justice of the European Union in the ONEL/OMEL case stated that territorial borders of Member States should be disregarded when considering the question of non-use of a Community trade mark [2].

The evidence showed that there had only been one non-UK sale. It was found that this one sale was insufficient to save the marks.

Passing off

Finally, the Court ruled that the claimant had established goodwill in its business which was associated in the public mind with the trading name "Sofa Workshop". Even though that name was descriptive it was found to have nonetheless acquired a secondary meaning in the mind of the relevant British public in England and Wales as an indication of the origin of the relevant goods and services. The use of the Sofaworks trade name therefore constituted a misrepresentation that its goods or services came from a source that was the same as, or associated with, Sofa Workshop.

Implications

The case shows the continuing importance of passing off as a weapon for trade mark proprietors – on this occasion, it saved the day for Sofa Workshop.

The judgment is also important for what it says about genuine use of a Community trade mark in the European Community. This is an area of law in which a decision of a higher court would be welcome.

Sofaworks has announced (very publicly via social media under #nealsayswhat) that it will be changing its name so an appeal is unlikely. Sofa Workshop could also appeal against the decision on its trade marks, though given that it ultimately succeeded, it is perhaps unlikely to do so.