Do you know your Champagne from your Cava? Quite possibly, but a High Court judge held in late 2015 that a Spanish cava producer trading under the brand name, “Cristalino” had used a confusingly similar sign to that of the famous tipple preferred by rappers and the like, “Cristal”.
The result of the case was perhaps unsurprising, especially given that the Defendants had not bothered to turn up for trial.
Having lost at trial, and in line with the usual practice of having separate trials on liability and quantum, the Spanish company was ordered to disclose the profits it made on the sales of Cristalino. It failed to do so, and did not take part in the account of profits that followed.
Account of profits hearings are so rare they are said to be like hens’ teeth. However, given the recent spate of them (including the one in the Jack Wills v House of Fraser litigation, in which Lewis Silkin was instructed), they might better be described as being like London buses - you wait for ages and then several come along at once.
The basic position in an account of profits is that the infringer has to hand over any ‘profit’ made. To determine the profit, the infringer can deduct properly attributable costs, and there can then be an ‘apportionment’ carried out to take account of the fact that the infringing goods (i.e. the cava in this case) have intrinsic value separate from that of the trade mark.
However, in order to do so, infringers need to get their evidence spot on, which is hard to do when you don’t take part in proceedings. Having failed to submit any evidence on costs that should be deducted, the Spanish company was ordered to hand over €1.3million. Those sorrows will take some drowning.