Overturning the decision of the High Court, the Court of Appeal has decided that Mattel’s SCRAMBLE mark is valid and infringed by Zynga’s use of SCRAMBLE and SCRAMBLE WITH FRIENDS in relation to online games. However, agreeing with the first instance judge, Peter Smith J, the Court of Appeal decided that Mattel’s SCRABBLE mark is not infringed.
We previously reported on Peter Smith J’s decision in which he held that there was no infringement of Mattel’s SCRABBLE mark and that its SCRAMBLE mark was invalid on grounds of descriptiveness. However, he also decided that Zynga’s use of a logo for SCRAMBLE WITH FRIENDS, which incorporated a stylised letter “M” which he perceived could be seen as a sideways “B”, infringed Mattel’s rights. The Court of Appeal also overturned this aspect of the first instance decision.
The Court of Appeal’s decision is very critical in places of the Peter Smith J’s approach, both to the assessment of the correct law and the evidence that was before the Court. In particular, unlike the judge, the Court of Appeal took into account confusion evidence from Twitter, demonstrating the potential value of this type of evidence in cases relating to likelihood of confusion. The Court also placed no significance on evidence that Peter Smith J had described as ‘destructive’ of Mattel’s case, relating to Mattel employees’ knowledge of Zynga’s game.
Court of Appeal decision
Floyd LJ discussed in some detail three aspects of law that were in dispute.
Contextual matter extraneous to the mark
Mattel argued that the court should consider features extraneous to the mark (and not just the alleged infringement) where such features are commonly used in conjunction with the mark. In particular, it indicated the background “woodland green” colour, together with the tiles, numbers and premium word scores. Mattel relied on the CJEU’s decision in Specsavers (discussed in the July 2013 IP Bulletin) where the CJEU decided that a mark registered in black and white that was used extensively in colour would affect how the average consumer perceives that mark and would therefore increase the likelihood of confusion with the allegedly infringing sign. However, Floyd LJ refused to accept that Specsavers went as far as Mattel argued. The mark in Specsavers was a black and white mark used in colour, whereas here, Mattel wanted account taken of matter which had been routinely used in association with the mark.
Whether similarity is a threshold question
In L’Oréal, Lewison J said that there is no minimum threshold test that needs to be overcome before the likelihood of confusion test is applied and that, in every case, it is a question of degree. Zynga highlighted a series of CJEU cases which it argued cast doubt on this proposition. However, Floyd LJ concluded that none of these cases provided direct authority for a minimum threshold of similarity test and confirmed that where the average consumer would perceive some overall similarity, however faint, it was necessary to carry out the global appreciation test. This conclusion was relevant as Peter Smith J had held that SCRABBLE was not similar to either SCRAMBLE or SCRAMBLE WITH FRIENDS and appeared to incorrectly apply this test.
Relevance of the descriptive connotation of the allegedly infringing sign
Zynga argued that, if SCRAMBLE was perceived by the average consumer as descriptive, this would contribute to a finding that there was no likelihood of confusion or necessary “link” in order to establish detriment to distinctive character. Zynga argued that, if the average consumer is likely to understand the descriptive allusion in SCRAMBLE, he is less likely to see it as indicating a connection with the proprietor of the mark. Floyd LJ accepted that the descriptive nature of the sign is one factor to be taken into account in the global appreciation of likelihood of confusion; the more obvious the descriptive meaning, the more power there was in this factor.
Validity and infringement of SCRAMBLE
The Court of Appeal disagreed with Peter Smith J that SCRAMBLE was descriptive of what was required in Zynga’s game (namely a scramble for words made up by letters in a fixed period of time) and that it was in common use for word game apps. Although there was “quite a degree” of descriptive allusion, its impact was not so far towards the descriptive end of the spectrum.
Given the finding of validity, Floyd LJ agreed with Peter Smith J that the question of infringement by SCRAMBLE and SCRAMBLE WITH FRIENDS was very straightforward. The goods were identical, and the addition of “WITH FRIENDS” was not adequate to avoid confusion.
Infringement of SCRABBLE
Despite criticising Peter Smith J’s analysis of the correct approach to assessing similarity of the marks and his refusal to consider Mattel’s evidence consisting of reviews and tweets relating to Zynga’s SCRAMBLE game, Floyd LJ upheld his conclusion that there was no infringement of Mattel’s SCRABBLE mark on the grounds of likelihood of confusion. This was despite the fact that Floyd LJ concluded that there was a moderate degree of overall similarity between the mark and the sign, the goods were identical, SCRABBLE had an enhanced distinctive character, and the scenario involved the purchase of a product which was either free or relatively cheap. Floyd LJ appears to have been swayed in reaching this conclusion largely on the basis of the extensive side-by-side use of SCRAMBLE, which he would have expected to have produced far more evidence of actual confusion.
Likewise, Floyd LJ decided that there was no infringement by the use of the logo with the stylised “M”. Again, if the average consumer was in fact reading the stylised “M” as a sideways “B”, he would have expected this to be reflected in the evidence.
The decision is a good result for Mattel whose SCRAMBLE mark has been upheld as both valid and infringed. The decision is also a reminder of the need to conduct the correct exercise when assessing likelihood of confusion, and the type of evidence that may assist the Court in carrying out that assessment.