A further verdict in the case of Boehringer Ingelheim & Others v Swingward & Others.

Background 

This long-running dispute has considered the legitimacy of re-boxing, de-branding, co-branding and stickering of the Claimants' genuine but parallel imported goods. Whether or not the repackaging of trade marked goods is legitimate under Article 7 of The Trade Mark Directive (the Directive) was considered in detail in Bristol Myers Squibb v Paranova (BMS) as a result of which the European Court of Justice (ECJ) stated that an importer who repackages and re-applies a trade mark will infringe that mark unless the following conditions are satisfied:

  • the repackaging is necessary in order to market the product;
  • the repackaging has no effect on the original condition of the goods and contains proper instructions;
  • the new packaging clearly identifies the manufacturer and the importer;
  • the new packaging is not such that it is liable to damage the reputation of the trade mark and its owner; and
  • the importer gives the trade mark owner notice of its intention to put the repackaged product on sale and provides a specimen product.

In the first High Court hearing in Boehringer v Swingward, the question arose as to whether it was "necessary" to re-box at all. As a result of this and the subsequent referral to the ECJ, the ECJ concluded that the necessity requirement was satisfied where "without such repackaging, effective access to the market concerned…must be considered hindered as the result of strong resistance from a significant proportion of consumers to relabelled pharmaceutical products." But on considering the case for a second time, the High Court interpreted the ECJ's findings to mean that the requirement of necessity applied both to the need to re-package at all and also the style of re-packaging under-taken.

The issue was appealed.

This time the ECJ reiterated the five BMS conditions and clarified as follows:

  • the necessity to repackage is directed solely to the "fact of repackaging" and not to the manner and style;
  • the requirement that the packaging must not be liable to damage the reputation of the trade mark or its owner is not limited to cases where the packaging is defective, of poor quality or untidy;
  • the question as to whether the de-branding, co-branding or stickering undertaken damaged or was liable to damage the trade mark's reputation is a question of fact for the national court; and
  • the parallel importer bears the burden of showing that it has complied with the five conditions but it is for the trade mark owner to prove that the repackaging is liable to or has damaged its reputation or that of its trade mark.

The ECJ's findings in essence reduced the case to one remaining issue – was the presentation of the repackaged goods liable to damage the trade mark's reputation or that of its owners? The case returned to the Court of Appeal.

The Judgment

The Claimants invited the Court to find that co-branding and de-branding are in principle liable to damage a trade mark's reputation. The Court rejected this. Damage was a question of fact and in assessing this the Court found it telling that the Claimants had agreements with multiple retailers such as Boots and Lloyds chemists. Under these agreements, the Claimants supplied their products in packaging bearing both the Claimants' and the retailer's trade mark, yet there was no evidence of any damage being caused. Partial de-branding was therefore not damaging in itself and total de-branding could not be an infringement as there is no use of the trade mark. The Court therefore held that the Defendants had complied with the fourth BMS condition and their activities in re-boxing and re-labelling would not cause damage to the Claimants' trade marks. However, that is not the end of the saga.

Another further repackaging case is due to come before the ECJ. In Wellcome v Paranova the following questions have been referred by the Austrian court:

  • 1(a) Is Article 7 of the Directive and the case-law of the ECJ which has been pronounced on it to be interpreted as meaning that proof that reliance on the trade mark would contribute to an artificial partitioning of the market must be furnished not only as regards the repackaging in itself, but also as regards the presentation of the new packaging?

If the answer to this question is in the negative:

  • (b) Is the presentation of the new packaging to be measured against the principle of minimum intervention or (only) against whether it is such as to damage the reputation of the trade mark and its proprietor?

Although Lord Justice Jacob expressed the view that on the surface it would appear that in Boheringer v Swingward the ECJ had already resolved these issues, the ECJ has agreed to consider the Austrian reference rather than simply referring it to the ECJ's existing conclusions on the issues. The Court of Appeal, rather reluctantly agreed to the Claimants' request that the final decision in this case be deferred until the ECJ's findings in Wellcome v Paranova are published. This is on the basis that the questions asked in the case may result in a further ruling on the issue of whether there is a minimum intervention requirement for legitimate repackaging. The parties will therefore make further written submissions following the ECJ's findings.

Finally if there is no such sixth condition or if it exists but was fulfilled, a further High Court hearing will still be required to determine the consequences of the defendants' failure to strictly comply with the fifth BMS requirement of giving notice to the trade mark owner of the re-packaging/re-labelling.

Comment

The debate over repackaging seemed to have been resolved, but these cases add a potentially new, and previously unmentioned requirement to the repackaging conundrum. If the ECJ does indeed conclude that "minimum intervention" is an additional requirement to the BMS conditions then the courts will be faced with a difficult challenge in applying what will be effectively a sixth condition. This could result in a further round of debates, referrals and appeals. In Jacob LJ's own words "European trade mark law seems to have arrived at such a state of uncertainty that no one really knows what the rules are".