In the recent case of Grenade (UK) Ltd v Grenade Energy Ltd and another [2016] EWHC 877 (IPEC), the Intellectual Property Enterprise Court (IPEC) has found that the Defendant company and its sole director were jointly liable for trademark infringement and passing off.

The Claimant in this case marketed food and drinks and specialised in energy and sports drinks.  The Claimant was the owner of two EU trademark registrations for a GRENADE sports energy drink.  The First Defendant was a company which had been setup in June 2013 and which also supplied energy drinks.  The Second Defendant was the sole director and shareholder of the First Defendant.

The Claimant issued a Summary Judgment Application seeking an early order from the Court that the First and Second Defendants had infringed its trademarks and were guilty of passing off by virtue of the First Defendant selling energy drinks using the name “Grenade”.

Both the First and Second Defendants admitted infringement of the Claimant’s EU trademarks.  Both Defendants also admitted that selling drinks using the name “Grenade” also constituted misrepresentation and that there was goodwill attached to the Claimant’s trademark.  However, both the First and Second Defendants argued that they had an arguable defence to the passing off claim on the basis that the Claimant had suffered no damage and therefore this issue should be dealt with at trial rather than at an earlier hearing.  The Second Defendant also argued that he had an arguable defence that he was not jointly liable for the trademark infringement and the passing off and again that this issue should be dealt with at a trial rather than at an earlier hearing.

In relation to the passing off claim, His Honour Judge Hacon held that it was inevitable that the Defendants’ actions would cause damage to the Claimant’s goodwill.  The Judge held that even if the Defendants’ activities had not caused the Claimant loss of sales, there had been a loss to the Claimant in regards to the goodwill attached to its business.  Therefore, Judge Hacon held that the passing off claim had been made out.

In relation to the Second Defendant’s joint liability with the First Defendant, as the Second Defendant was the sole director and shareholder, there was a presumption that the First Defendant’s acts were committed at the Second Defendant’s instigation.  The Second Defendant had been unable to identify anyone else who could have been responsible for acts the Claimant complained of.  The Judge therefore took the view that the Second Defendant had actively co-operated in the trademark and passing off infringements and was therefore jointly liable.

This case is useful guidance on when company directors will be found jointly liable for intellectual property infringements that their companies commit.  Our specialist intellectual property solicitors have dealt with a variety of cases, for both claimants and defendants, where both companies and company directors have been named and regularly advise companies and company directors on liability for intellectual property infringements.

Our commercial litigation and commercial solicitors have a vast amount of experience in advising businesses and individuals in regards to intellectual property law such as trademarks, copyright, design rights and patents. Both teams are ranked as top tier in the legal directory Legal 500. Please do not hesitate to contact one of our intellectual property solicitors today if you require advice in regards to your intellectual property rights. 

Contact Us

Share our latest new updates