Intellectual Property Dispute Case

In a recent decision in the specialist Intellectual Enterprise Property Court which deals with intellectual property disputes, His Honour Judge Hacon has held that Scratch Meals had infringed Fit Kitchen’s registered trademark and was guilty of passing off. 

Fit Kitchens Limited (FKL) was incorporated as a limited company at Companies House in February 2015.  FKL started trading in 2015 using the name “Fit Kitchen”.  Since June 2016, FKL’s ready meals were marketed and sold solely via its website.  Customers can register online, enter their details including food preferences and ready meals are subsequently delivered to the customer’s door.  Among the details entered on FKL’s website are the customer’s desired macronutrients or “macros” which are the customer’s desired proportions of carbohydrates, protein and fat.  Fit Kitchen’s ready meals are advertised as conforming with the customer’s macros and as being healthy meals. 

In August 2016, FKL applied to register a trademark in respect of food and drink catering and food preparation and services.  FKL’s trademark was granted as a UK Trade Mark in November 2016.  FKL’s trademark is in the form set out below:

Fit Kitchen

The Defendant, SML, also makes ready meals and sells them through supermarkets.  Between December 2016 and November 2016, SML sold its meals using the sign FIT KITCHEN.  An example of this can be seen in the packaging below:

Fit Kitchen 2

As a result of this, FKL alleged that sales of SML’s products using the branding FIT KITCHEN infringed their registered trademark and also constituted passing off.  These allegations were denied by SML and SML also issued a counterclaim for FKL’s registered trademark to be revoked on the basis that FKL had registered its trademark in bad faith. 

The issues the Judge had to deal with were, therefore: 

  1. Was FKL’s trademark invalid on the basis it had been registered in bad faith?
  2. Had SML infringed FKL’s trademark?
  3. Was SML guilty of passing off? 

SML’s bad faith argument

The assertion of bad faith related to the fact that, for a brief time, FKL had been dissolved and removed from the register of companies because it had failed to file accounts.  FKL was dissolved as a company on 2 August 2016 for failing to file its accounts for the year 2015/16.  On 30 May 2017, FKL applied to restore the company to the register and FKL was subsequently restored as a company on 11 December 2017. 

Trademark Application

However, in the intervening period (i.e. before FKL had been restored to the register) and as set out above, FKL had applied to register its trademark.  SML, therefore, argued that FKL’s trademark application had been filed in bad faith and amounted to “an act which fell short of acceptable commercial behaviour observed by reasonable and experienced men in this area”.  However, the Court quickly rejected SML’s argument for two reasons.  Firstly, because once FKL had been restored as a company, FKL was deemed to have existed at all times.  Secondly, because the second claimant (who was the co-founder of FKL) was unaware that FKL had been struck off the company register and had continued to trade under the FKL banner throughout. 

Did SML infringe FKL’s trademark?

In reaching its decision, the Court had to consider two parts of the Trade Marks Act 1994 (TMA) which is the relevant legislation when deciding trademark disputes. 

The Court firstly considered section 10(3) of the TMA which says that trademark infringement occurs when a person in the course of trade uses a sign which is identical with or similar to a trademark and where the trademark has a reputation in the United Kingdom and the use of the sign takes unfair advantage of or is detrimental to the distinctive character or the reputation of the trademark.  Unfortunately for FKL this element of their claim did not succeed because the Court held that FKL’s trademark did not have the requisite reputation at the relevant time. 

The Court then went on to consider section 10(2) of the TMA which says that a person infringes a registered trademark if he uses in the course of trade a sign which is identical or similar to the registered trademark for goods or services which are similar or identical to those for which the trademark is registered and this is likely to cause confusion to members of the public.  This part of FKL’s claim was successful.  FKL was able to give 65 examples of instances where members of the public had contacted FKL about SML’s products, usually to make a complaint.  There were also other instances where SML was contacted by third parties who actually wished to communicate with FKL. 

 

Was SML guilty of passing off?

The underlying principle behind passing off is that “a man is not to sell his goods under the pretence that they are the goods of another man”.  To succeed in its passing off claim, FKL had to establish that there was goodwill in its business, a misrepresentation on the part of SML and consequential damage.  The Judge held that by December 2016, FKL had used its registered trademark sufficiently to generate goodwill in its business and that that goodwill was associated with its trademark.  The Judge also stated that because confusion had been caused to members of the public (please see above) this supported a finding that there had been a misrepresentation on the part of SML and that damage had been caused.  Therefore, FKL succeeded in its argument that SML was guilty of passing off. 

 

What can we learn from this case?

FKL is a relatively small business with a modest turnover.  As the considerably larger entity, both in terms of revenue and operations, SML may have hoped that FKL would not succeed in its claim because FKL had not built up enough of a reputation and goodwill in its Fit Kitchen brand.

 

This case, however, is an important reminder that the threshold for establishing goodwill in passing off claims is lower than the threshold for establishing reputation under section 10(3) of the TMA.  Also, whilst evidence of actual confusion is not necessary to succeed in a claim under section 10(2) of the TMA, being able to prove actual confusion will be helpful in any trademark infringement proceedings.

 

Our team of specialist intellectual property disputes solicitors routinely advises on a broad range of disputes relating copyright, trademarks, patents and design rights along with matters relating to data protection and confidential information

The team is also highly skilled at advising on reputation management issues and are regularly instructed by clients from the media, arts, clothing, textile and many other sectors in the UK and internationally.  If you need advice on intellectual property matters please do not hesitate to contact a member of the team today.    

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