In Future Publishing Ltd v The Edge Interactive Media Inc & Ors [2011] EWHC 1489 (Ch) the Claimant succeeded in showing breach of a co-existence agreement through actions that amounted to passing off.  The Claimant also succeeded in invalidating the Defendants’ marks.

BACKGROUND

The proceedings were brought against Edge Interactive Media Inc (EIM), Edge Games Inc (Games Inc) and Dr Timothy Langdell. At the outset of the judgment, EIM and Games Inc were found to be controlled exclusively by Dr Langdell and anything that EIM and Games Inc had done had been solely through his intervention.

In 1993, Dr Langdell issued proceedings against Future for passing off, alleging that he had unregistered rights in the mark EDGE. In 1994, Dr Langdell applied to register the EDGE mark in Class 16 (printed matter), including gaming magazines. That litigation was settled in 1996, by which time Future had also applied to register EDGE as a trade mark in Class 16.

Under the 1996 settlement agreement, Dr Langdell kept his registered mark and was given Future’s trade mark application in return for a royalty-free licence for Future. Future paid Dr Langdell £20,000. All rights and goodwill arising out of the mark were to vest in EIM, which was prohibited from publishing or licensing anyone else to publish a magazine substantially similar to EDGE magazine under the name EDGE. EIM was also prohibited from claiming any association or connection with EDGE magazine or with Future.

In 2004, the parties entered into a Concurrent Trading Agreement and a Deed whereby the inherent goodwill and the trade marks (registered and unregistered) that included the word EDGE, and which covered magazines and printed matter in the field of computer games, were assigned to Future. The agreements also stated that Dr Langdell would not use any of the trade marks “in a way which is or could reasonably be confusing with Future’s use of the same…”

BREACH OF CONTRACT

It was common ground that Dr Langdell had used three versions of an EDGE logo. One of the versions was indistinguishable from the logo used by Future and had been used on EIM’s letterhead in 2008 and 2009 and on its website from 2003/2004 to June 2009. Dr Langdell admitted in crossexamination that he had adopted the EDGE logo on his website in order to create a connection in the mind of the public with Future. He said that he believed that he had the right to do so, on the basis of his assertion that it was he who had, in fact, devised the logo, an assertion that the judge rejected outright on the evidence.

The judge instead accepted Future’s submission that all uses of the EDGE mark complained of were confusing or could reasonably be confused with Future’s EDGE logo. This was a straight breach of the 2004 agreements.

The judge also accepted Future’s submission that various statements made by Dr Langdell, combined with his use of the EDGE logo, were designed to confuse. The judge stated that there was ample evidence to justify the finding that the statements described a relationship between EIM and Future that did not exist. This “relationship comprised a confusing use of the EDGE mark, and was a breach of the 2004 agreements.

The breaches were found to be fundamental breaches according to the test expounded by Lord Justice Buckley in Decro-Wall v Practitioners in Marketing [1971] 1 WLR 361.

PASSING OFF

The judge found that Dr Langdell had tried to appropriate for his own business the goodwill associated with EDGE magazine through statements leading the public to believe EIM was responsible for EDGE magazine or that EIM’s games were in some way approved or authorised by Future. It followed, “that all pleaded breaches of the [agreements] committed within the jurisdiction of the court also comprise acts of passing off as representations likely to lead to confusion”.

COPYRIGHT INFRINGEMENT

The judge accepted that, on the evidence, it was Future’s creative director, Mr Williams, who had created the EDGE logo, not Dr Langdell. Further, she said, the logo had artistic originality. Therefore, use by Dr Langdell of all three versions of the EDGE logo were copies infringing Future’s copyright. Because Dr Langdell had threatened to continue using the logo, an injunction restraining him from further use was justified and appropriate.

INVALIDITY FOR NON USE

Dr Langdell’s only evidence of use came from assertions in witness statements. There was no evidence of advertising or promotion of sales in the United Kingdom. The only evidence of anybody purchasing his games in the United Kingdom came via a “trap” purchase undertaken by Future for the purposes of the proceedings. When Future had tried to buy the games, they had not been delivered by EIM. In short, there was no evidence of genuine use by Dr Langdell in the United Kingdom. Dr Langdell’s marks, accordingly, were found to be invalid.

COMMENT

This should have been a straightforward case of breach of contract, copyright infringement and passing off, but the case was complicated by allegations of forgery and evidence that was found by the judge to have been concocted. Expert evidence was required to prove (or, rather, disprove) the genuineness of information on disks said to date from 1991. New evidence and allegations of forgery arose during closing submissions that required the judge to consider whether or not to hear further evidence.

This makes interesting reading, but importantly it would appear that the judge found a sensible and proportionate way to deal with such matters in order to bring the proceedings to a close.