In a judgment involving allegedly deceptively similar vodka bottles, the High Court has reiterated the high hurdles that must be satisfied for a claimant to succeed in protecting its product "get-up" by relying on passing off.
In Au Vodka Ltd v (1) NE10 Vodka Limited (2) Leon Hogan,(1) the claimant was the owner of a premium vodka brand. Launched in 2015 as original vodka with initially modest sales, the brand experienced massive growth from 2019 following the introduction of a range of six flavoured vodkas. The vodkas were sold in gold metallic bottles (Figure 1), each bearing a square label towards the top with the words "Au VODKA" and a lower rectangular plate identifying the flavour.
Figure 1: Au Vodka bottles
It was clear from the evidence that the impressive growth of the Au Vodka brand was largely due to the extensive investment in marketing by the claimant, particularly on social media, which included partnering with a number of well-known celebrity influencers.
The first defendant, NE10, was incorporated in September 2021. The second defendant, Mr Hogan, was the sole director of the first defendant. Product development was, however, collectively undertaken by a team of four. The defendants launched their range of NE10 vodkas in August 2022, also in metallic bottles (Figure 2) bearing a shield-shaped label with the words "NE10 Vodka".
Figure 2: Ne10 Vodka bottles
The claimant first learned about the defendants' product on 13 August 2022 from a single post on Mr Hogan's personal Instagram page featuring a picture of the NE10 Vodka bottle. The claimant did not raise a complaint at that stage, but after the NE10 Vodka website and Instagram page went live just over a week later, the claimant instructed solicitors to send a letter before action. In the judge's view, this letter was not well articulated, with the passing off claim being buried in "hopeless allegations"(2) that were subsequently not pursued. The claims were clarified in a second letter sent by different lawyers on behalf of the claimant a further week later. Subsequently, in September 2022, the claimant issued passing off proceedings and sought an interim injunction to restrain the marketing and sale by the defendants of their vodka. The judgment discussed in this article relates to that application and several interesting comments were made by the judge that will be useful for future claimants looking to rely on passing off as a cause of action.
"Classical trinity"
In his judgment, Mr Justice Mellor summarised the elements of the tort of passing off which a claimant must establish in order to succeed (otherwise known as the "classical trinity" as set out in Jif Lemon).(3) These are:
- goodwill or reputation attached to the claimant's goods or services which the purchasing public would associate with the get-up of the product and recognise as being distinctive of the claimant's goods and services;
- a misrepresentation by the defendant leading the public to erroneously believe that the goods or services offered by the defendant are those of the claimant; and
- a likelihood of the claimant suffering damage.
Flowing from this, the judge emphasised several important (but sometimes overlooked) points around passing off claims relating to product get-up.
Get-up as source indicator
The judge was clear that where a claimant pleads that the shape of a product is distinctive of them, they must show that the shape is the source indicator. In other words, a claimant cannot rely on product shape as the primary basis of their passing off claim if, in fact, consumers rely on other elements of the get-up to identify trade origin. He remarked that Jif Lemon was a rare successful shape case because the evidence showed that the labelling of the plaintiff's product was discarded shortly after purchase and that the embossed word "Jif" on the bottle was not easily seen. That left the appearance of the lemon shape alone as the source indicator.
The judge referred to a recent decision of the EU Intellectual Property Office (EUIPO) Board of Appeal(4) concerning the registrability of a vodka bottle (Figure 3) as a 3D trademark. One aspect of the claimant's submissions in the present case was that the shape of its bottle was sufficiently distinctive of the claimant for passing off purposes. It argued that this Board of Appeal decision supported its submission. The Board of Appeal had decided that the bottle shape in that case was "distinguishable" from the shapes of other bottles available on the relevant market and so was sufficiently inherently distinctive to be registrable. The claimant argued that the Board's decision demonstrated that the shape of a bottle without labelling could be distinctive per se, and for the purposes of succeeding in a passing off claim.
Figure 3: EUIPO Board of Appeal case vodka bottle design
Mr Justice Mellor was somewhat scathing of the claimant's argument on this point. In his view, the Board had erroneously extrapolated from the fact that the shape of the bottle was distinguishable from the shape of other bottles on the market that the shape thereby fulfilled its essential function of indicating the origin of the product. He felt that there were "fallacies" in this reasoning, saying these fallacies "ought to be obvious. 'Distinguishable' simply means 'different'. It does not mean the shape is distinctive in the trade mark sense of indicating origin".(5) He went on to say:
in the real world, the proprietor does not trust this [shape] mark to indicate origin because, as one would expect, [the proprietor] puts distinctive word marks on the label and it is these marks which serve to indicate origin, at least until many years of use have been built up.(6)
In other words, consumers in the real world are not in the habit of making assumptions about the origin of products based on the shape of goods alone in absence of graphical or word elements.
Applying these views to the present case, Mr Justice Mellor noted that the word/graphical elements on the respective bottles were "Au79" and "NE10" and that, unlike in the Jif Lemon case, this labelling could not be discarded. The evidence also suggested that the claimant's labelling was noticed, because consumers referred to the product as "Au Vodka". The evidence also provided strong support for the proposition that the (larger) NE10 labelling did not go unnoticed by consumers either and that the defendants' products would be referred to by consumers as "NE10 Vodka". Further, the evidence showed that the claimant's vodka was consistently referred to by consumers by its name, "Au vodka", and not, for example, identified as the "gold vodka" or "the vodka in a gold bottle". In the judge's view, the most significant feature of the overall branding of the Au Vodka products was the name Au, followed by the metallised gold bottle, plus an indication of the flavour.
The takeaway from this aspect of the judgment is that persuading a court that consumers identify the trade origin of a product from its shape without reference to labels or other aspects of get-up will not be without its challenges. This consideration will impact on how passing off claims should be pleaded.
In this case, the claimant had identified seven features of its product which it pleaded to be part of the get-up in which it claimed to have goodwill. This included:
an elongate (meaning tall and thin) bottle having a slight arcuate taper from base to top, a prominent shoulder portion, and a neck of extended length, the bottle being metallised, more specifically metallised in the colour gold and the bottle being generally of clean appearance, that is to say without further adornment.(7)
Mr Justice Mellor found these features to be generalised and noted that consumers would not focus on features such as the bottle being metallised. Rather, consumers would focus on the content of the labels. Indeed, the one feature of the bottle that Mr Justice Mellor did feel was important for consumers was not pleaded: the colour of the capsule or foil which secured the stopper at the top of the bottle and was the most important indicator of the flavour. He said the features of the claimant's get-up relied on were:
expressed at a level of abstraction which is designed to include the relevant feature of the defendants' products but which bear no relation to what a consumer would carry in his or her mind, having seen the claimant's get-up.(8)
He went on to say:
as I have already indicated and illustrated, the shape and dimensions of the rival bottles are extremely close. Other similarities are detailed by the claimant by reference to the particulars of its get-up, a number of which are, as I have indicated, expressed at a level of abstraction which is divorced from what ordinary consumers perceive and carry in their heads.(9)
The takeaway here is that, when bringing a passing off claim, the two products in issue should not simply be placed side by side, compared and the similarities pleaded. Instead, emphasis should be placed primarily on those product features noticed and likely taken into account by consumers when identifying trade origin and making a purchasing decision.
Misrepresentation
Mr Justice Mellor emphasised that actual or likelihood of deception must be shown in passing off, not mere consumer confusion (or likelihood of it). The claimant had submitted evidence of six comments on social media from consumers to support its argument that there had been deception generated by the defendants' NE10 products. Mr Justice Mellor, however, concluded that these comments at best showed a recognition of the similarity of the respective bottle shapes but did not amount to instances of actual deception. He said:
doing the best I can on the evidence, viewed in context, it seems to me that none of these people were actually deceived into thinking the defendants' vodka was that of the claimant. At most, one might say that these instances support a case that consumers will believe the defendants' vodka comes from the same stable as the claimant (cf indirect confusion in the law of registered trade marks), but, to my mind, what they evidence is consumers wondering whether there is a connection as opposed to actually believing that there is one. So these are not, in my judgment on the current evidence, instances of actual deception.(10)
It can be tempting to take instances of consumer mistakes around branding and use this as evidence of deception. However, this aspect of the judgment is a useful reminder that before seeking to rely on any such evidence the material must be reviewed carefully to ensure that there is, in fact, consumer deception and not merely a link in the minds of those consumers between the claimant's and defendant's products.
Additional observations
Two additional observations of Mr Justice Mellor are worth noting.
First, quoting the ROHO(11) case, the judge emphasised that "there is no tort of copying" and "the foundation of the plaintiff's case here must therefore lie in deception".(12) In other words, in a passing off claim, the process by which the defendant arrived at its product:
matters little, if at all. What matters is the effect the resulting product has on prospective purchasers. For present purposes I can proceed on the assumption that the defendants did copy, but that does not get the claimant home nor does it establish that the defendants intended to trade off the claimant's reputation.(13)
In this case, the claimants had argued that there was evidence that the defendants had copied their product and that a finding of passing off should necessarily follow. It is clear from this judgment that any such future argument is unlikely to succeed. Mr Justice Mellor cited the classic cases of Specsavers(14) and Moroccan Oil(15) to stress the importance of "deception" in passing off cases and explain the difference between "deception" and "living dangerously" (where a defendant has appreciated the risk of deception and so chosen get-up which was just on the "right side of the line"). In the present case, the judge was willing to assume that the defendants did copy the claimant's product but remarked that that alone did not establish that the defendants intended to trade off the claimant's reputation for the purposes of passing off.
Second, the claimant had joined Mr Hogan, director of the first defendant, as a party to these proceedings, pleading that he was he was both personally liable for his own acts and jointly and severally liable with the first defendant for its acts. The Court struck out a claim that Mr Hogan was personally liable for his own acts, holding this allegation to be "unsustainable. In his personal capacity, Mr Hogan has not done any of the acts which could constitute passing off".(16) It is common to join directors to proceedings, often with a view to putting pressure on them to settle. There have been a number of judgments recently which have emphasised that directors should only be added as a party to proceedings where there is clear evidence of their involvement in infringing acts. Claimants should bear this in mind, to avoid claims being struck out, with possible costs consequences.
While this decision only dealt with the application for an interim injunction and therefore did not fully address the merits of passing off claim, it clearly illustrates the difficulties of trying to establish a passing off claim on the basis of product get-up alone. It has long been established that most consumers would refer to and recognise a product by its brand name as opposed to its shape. Cases where consumers identify a product by its shape alone, as in Jif Lemon, are exceedingly rare.
The interim injunction was refused in this case. The analysis from Mr Justice Mellor illustrates that trademarks are generally a stronger right to rely on when it comes to enforcement, notwithstanding the difficulty of overcoming absolute grounds of refusal when seeking to register a non-traditional trademark such as a 3D shape. It is, therefore, still worthwhile attempting registration of distinctive shape marks which depart sufficiently from the norms and customs of the sector.
As for the letters before action sent by the claimant, one of which also included a series of "hopeless allegations" which later affected Mr Justice Mellor's analysis on the balance of convenience, these provide an instructive warning to brand owners to ensure that their case is carefully considered and based on solid grounds rather than "throwing the kitchen sink" at an issue which buries the substantive issues to be decided.
For further information on this topic please contact Gill Dennis, Désirée Fields or Celia Tao at Pinsent Masons by telephone (+44 20 7418 8250) or email ([email protected], [email protected] or [email protected]). The Pinsent Masons website can be accessed at www.pinsentmasons.com.
Endnotes
(3) Reckitt & Colman Ltd v Borden Inc [1990] 1 All ER 873.
(4) Case R 1839/2021-5 The Absolut Company Aktiebolag (3 June 2022).
(5) [2022] EWHC 2371 (Ch) at paragraph 49.
(11) Hodgkinson & Corby Ltd v Wards Mobility Services Ltd [1995] FSR 169.
(12) [2022] EWHC 2371 (Ch) at paragraph 37.
(14) Specsavers v Asda [2012] EWCA Civ 24.