Arsenal Football Club recently suffered a surprising setback when it sued a seller of Arsenal football merchandise. The club had registered the Arsenal crest and cannon as trade marks in the 1990s. It sold a wide range of Arsenal merchandise from the ground and also through licensees, some of whom were licensed to sell trade marked goods to unlicensed vendors. Any merchandise sourced or sold by the club indicated prominently that it was "official" and was manufactured on its behalf.
Matthew Read was a long-time Arsenal fan, whose company had been selling football souvenirs and memorabilia for over 30 years. He sold "Arsenal" goods from a stall outside the football ground. Some emanated from the club's licensee but the majority came from unofficial sources.
The club sued Mr Read for passing off and trade mark infringement. Laddie J (unreported - 6 April 2001) dismissed both claims. On passing off, he held that the club had failed to prove any confusion between the two sets of goods. Mr Read had carried on his trade for many years and a sign on his stall made clear that only goods with official Arsenal merchandise tags were official Arsenal merchandise. Another stated that some scarves on his stall were cheaper than others, because the latter were "official". On a balance of probabilities, Laddie J held, the reason that the club had not been able to produce evidence of actual confusion was that no such confusion had taken place. The club had not therefore suffered any relevant damage through Mr Read's activities.
As for trade mark infringement, the mere fact that words or designs were used on an item of clothing does not mean that they were being "used as a trade mark" for the purposes of the Trade Marks Act 1994. In the judge's opinion, Arsenal supporters would view the logos on Mr Read's goods as badges of support, loyalty or affiliation, not as trade marks to indicate trade origin.
The judge said that the question whether or not non trade mark use constituted infringement of registered trade mark rights was a matter which, despite a referral by the Court of Appeal on the same point (in Philips Electronics NV v Remington Consumer Products Ltd) would probably still need to be resolved by the ECJ. This was because he suspected that the ECJ would not determine the point in that referral due to the way in which the Advocate General in Philips had framed his opinion.
In the Philips case (Opinion dated 23 January 2001), Advocate General Colomer stated that the question as to whether an indication of trade origin is required for a sign to infringe referred by the English Court of Appeal was rendered hypothetical by his answer to other questions at the core of the case. In summary, he found that under Article 3(1)(e) of the Trade Marks Directive, a shape, the essential features of which lead to the achievement of a technical result, cannot be registered, even if there are other shapes which can achieve the same result (in this case, rotary shavers). The Court of Appeal's question on trade origin was, in his view, another way of looking at the distictivenes of a mark. That point was was not in issue due to his view (and that of the Court of Appeal) on the unregistrable nature of certain shapes.
The ECJ will be asked to decide the following questions from the Arsenal case:
- Does an alleged infringer have a defence if his use of a sign which is identical to the registered mark does not indicate a trade connection between the goods and the trade mark owner? and
- Is the use of a badge of support, loyalty or affiliation to the owner enough to indicate that connection?
The second question may not be decided if the ECJ holds that no indication of trade connection to the owner is necessary when the sign and the trade mark are identical.
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