In a complex trade mark case, Hotel Cipriani SRL v Cipriani (Grosvenor Street) Ltd  EWHC 3032 (Ch), the English High Court has ruled that despite being Ciprianis of some repute themselves, the owners of the Cipriani restaurant in London have infringed a well-known trade mark and passed their business off as having a connection with the Hotel Cipriani in Venice and its sister hotels under the same name.
The Claimant, HC, was the owner of the Hotel Cipriani in Venice and the Ristorante Hotel Cipriani in Lisbon and Madeira. HC is the proprietor of a Community trade mark (CTM) for the word mark CIPRIANI for various goods and services including hotels and restaurants.
The Defendants (the Ciprianis) were the owners of Cipriani London, usually referred to as The Cipriani, its sole director Giuseppe Cipriani and a Luxembourg corporation of which Giuseppe Cipriani and his father Arrigo are directors. Arrigo’s father, Giuseppe Senior, used to own a significant proportion of the shares in HC, but he had long since sold his interest in HC. The Ciprianis had applied to register two CTMs in respect of food and services, both of which included the word CIPRIANI. HC opposed the applications, with complete success in relation to services and partial success in respect of the food application. This spat was significant in the context of the current dispute because it established that the Ciprianis, and probably Arrigo himself, were aware that HC owned the CTM in suit.
In November 2006, HC brought an action for passing off and trade mark infringement of its CTM (but not its UK mark) and sought the protection afforded to well-known marks under Section 56 of the Trade Marks Act 1994. The Ciprianis counterclaimed for invalidity of both the CTM and UK trade mark on the basis that they had been applied for in bad faith.
It was held that the Ciprianis’ use of CIPRIANI infringed the CTM under Article 9(1)(a) of the Community Trade Mark Regulation (40/94/EC) and their use of CIPRIANI LONDON infringed the CTM under Article 9(1)(b). Arnold J held that they did not have a defence to either claim under Article 12(a) and were also liable for passing off. Arnold J dismissed the Ciprianis’ counterclaims for declarations that the CTM and the UK trade mark were registered invalidly and granted HC an injunction under Section 56. He found Giuseppe and the Luxembourg corporation liable jointly with the restaurant.
Arnold J held that the Ciprianis could not rely on the own-name defence in Section 11(2) of the Trade Marks Act, since a legal person, such as the restaurant, could only avail itself of the defence if it was using the whole of its name, as registered. The restaurant business was registered as “Cipriani (Grosvenor Street)”, which would not excuse its use of the word CIPRIANI or CIPRIANI LONDON. Furthermore, the judge noted that, following Asprey & Garrard Ltd v WRA (Guns) Ltd  EWCA Civ 1499, the defence was not available to new companies, as this would provide an obvious defence to piracy. Giuseppe, as second Defendant, could not rely upon the defence as he was not himself trading and the Luxembourg corporation could not rely upon the defence because neither was it trading nor was CIPRIANI its name as registered. In any event, the second part of the test, that the use of the mark should be in accordance with honest practices, was not fulfilled because it was clear that the Ciprianis had been aware of HC’s CTM, since HC had used it as a basis to oppose their CTM applications before the Office for Harmonization in the Internal Market (OHIM).
Lessons can be learned from this case on the question of coexistence agreements. When Giuseppe Senior sold his shares in HC, the parties had entered into an agreement, under Italian law, supposedly drawing the boundaries within which the two sides would operate in future. Sadly, the agreement was not well-drafted and was clearly prepared without the benefit of specialist trade mark advice.