In its ruling in Bayerische Motoren Werke AG v Technosport London Ltd and George Agyeton, the Court of Appeal has provided clear guidance on the distinction between informative and misleading use of a trade mark by a third party.
Article 12 of the EU Trade Mark Regulation makes clear that a trade mark owner cannot prevent a third party from using its mark in the course of trade when the mark is used in a purely descriptive manner to indicate the intended purpose of a product or service (in particular as accessories or spare parts) or to describe other characteristics of the goods or service, such as the kind, quality, intended purpose, value, geographical origin, etc.
BMW sued an independent garage, Technosport, and its owner, alleging trade mark infringement and passing off by Technosport, which was using the BMW name and logos (which are protected as trade marks) in connection with Technosport's BMW and Mini car repair and maintenance service.
BMW was only partially successful at first instance (in relation to Technosport's use of the BMW Roundel and M Logo), and it appealed. The question before the Court of Appeal was whether the use of the BMW name by Technosport within its trading name fell within the category of permitted uses (i.e. the use was purely informative) or whether the use went further, suggesting a trading connection between the garage and BMW.
Informative vs misleading use of a trade mark
The question that must be asked in this context is: what message is conveyed to the consumer through the way in which the trade mark is used?
- The key distinction is whether such use is merely informative and conveys the true message (e.g. my business provides a service which repairs BMWs) or whether the use conveys a false message (e.g. my car repair service is commercially connected to BMW).
- Is the trade mark being used as a trading style? Technosport was styling its business as ‘Technosport BMW’, i.e. it was using the BMW trade mark as an identifier of its business and services (a trading style) rather than as a description of what it did.
- The context of use is important. The ‘Technosport BMW’ trading name was being used on the company van, company t-shirts and as a Twitter handle (@TechnosportBMW) but with no additional messaging in the immediate context to make it clear to the consumer that Technosport was operating solely as a BMW repair specialist. In fact, in the case of the van, the BMW Roundel logo appeared immediately below the Technosport BMW sign.
The court found that the use of the BMW mark within the ‘Technosport BMW’ name as a trading style, without further explanation, amounted to more than informative use, and naturally carried the risk of conveying the impression of a connection between Technosport and BMW. Technosport therefore strayed into the territory of misleading use.
Application of this ruling
The court’s ruling can be applied to many other contexts outside of car repair – essentially whenever a third party uses a brand owner's mark as part of its trading style, rather than to merely inform the consumer as to the nature of a product or service it is offering.
While obtaining trade mark protection can be an incredibly powerful and useful form of IP protection for a brand, there are limits to the scope of protection that a trade mark registration affords: a brand owner will not be able to prevent the use of its mark by third parties where that use is genuinely descriptive. However, where that third party is styling its business in such a way so as to trade off a perceived connection with the brand owner's mark, it is entirely right that the law allows brand owners to take action against the infringer in this scenario.