We discuss the recent Court of Appeal decision in the trade mark dispute between Comic Enterprises and Twentieth Century Fox.
In a real David and Goliath battle, the Court of Appeal recently considered a claim for trade mark infringement and passing off brought by Comic Enterprises (CE), the owner of a number of comedy and live music venues called “The Glee Club”, against Fox, the makers of the hit TV show, “Glee”.
By the end of 2009, when Glee was first broadcast in the United Kingdom, CE had two venues, one in Birmingham and the other in Cardiff, which opened in 1994 and 2001 respectively. In 2010, it opened two more venues in Oxford and Nottingham. CE owned two registered device marks (the Mark) made up of the words 'the glee CLUB' written in lowercase and in a particular script and presented in a cone of light from a spotlight, which were used in respect of the clubs. CE had made extensive use of the Mark in connection with its business, and the Birmingham and Cardiff venues used external signage very similar, if not identical, to the Mark.
Following its launch in 2009, Glee, which (for those of you who missed the phenomenon) focused on a fictional American high school singing club, became very successful in the UK. Recordings of songs performed in the TV series were sold in the UK and the cast took part in a world concert tour. Fox marketed the TV series and associated activities using the word “glee” in lettering which was similar but not identical to that used in the Mark. In contrast to Glee’s success, CE struggled to establish its new venues in Oxford and Nottingham. It found that customers were discouraged from attending the clubs as they believed them to be in some way associated with the TV show.
In proceedings before the High Court, CE successfully claimed for trade mark infringement but failed in a claim for passing off. Fox appealed the findings on infringement and CE cross appealed, arguing that the High Court should have also found in its favour in the passing off claim.
This case is of interest to businesses for a number of reasons. Firstly, it concerned “wrong way round confusion”, where it was consumers’ familiarity with Fox’s later mark that caused confusion, as opposed to the more common claim that the defendant's brand is confused with the claimant's. The Court of Appeal confirmed that such evidence is not only admissible, but can be enough to establish trade mark infringement even if there is no evidence of traditional “right way round” confusion. Businesses should therefore be very cautious when using a sign that is similar to a registered trade mark as, even if confusion is not likely at launch, the sign may become infringing if it develops sufficient recognition to cause confusion with the earlier, less well known trade mark.
The use of social media for collecting evidence of confusion by consumers was also a feature of this case. CE made effective use of platforms such as Twitter to find witnesses who had spontaneously posted remarks about their confusion between the two enterprises. While such evidence will always be subject to careful scrutiny as to whether it adequately demonstrates a likelihood of confusion, it has shown how social media can be a valuable tool for monitoring consumers’ reactions to potentially infringing marks.
This case is yet another example of the benefits of registering a trade mark rather than seeking to rely on the common law remedy of passing off. In this case CE’s trade mark provided powerful protection notwithstanding the comparative size and resources of the respective parties.
The Court of Appeal reiterated that the scope of protection conferred by the law of passing off is more limited than that afforded by a registered trade mark. In contrast to the position in a passing off claim, a court considering a claim for infringement need not restrict its consideration to the particular way the mark has been used and the goodwill that has been generated in connection with it. It may take into account a notional and fair use of the mark in relation to all of the goods and services for which it is registered. However, the protection provided by a registered trade mark is by no means absolute and businesses seeking to enforce their rights should expect to have their use of the relevant mark scrutinised. For example, CE had their registration in respect of clothing revoked for non-use during the High Court proceedings.
This decision could have serious repercussions for Fox. It has already had been ordered to pay what was described as an “extremely conservative” sum of £100,000 on account of damages or profits, which could run into millions on assessment. It also faces having to rebrand one of its most successful TV shows for the UK market. Perhaps unsurprisingly given what is at stake, Fox has indicated that it intends to appeal the decision, potentially through the European Court on the basis it is incompatible with EU law.