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CoA attacks European trade mark ruling

25 May 2010

The Court of Appeal has attacked the European Court of Justice for a trade mark ruling which it said would mean “poor consumers are the losers”.

The case originated in the UK with leading perfume brands L’Oreal, Lancome and Laboratoire Garnier taking action against Bellure and other companies for producing a range of products designed to imitate their brands.

“Only the poor would dream of buying the defendants’ products,” Lord Justice Jacob said. “The real thing is beyond their wildest dreams. Yet they are denied their right to receive information which would give them a little bit of pleasure, the ability to buy a product for a euro or so which they know smells like a famous perfume.”

Giving judgment in L’Oreal v Bellure [2010] EWCA Civ 535, Jacob LJ said the defendants had three ranges of products each of which smelled like a branded perfume used by a well-known registered trade mark.

“L’Oréal alleges that the defendants’ use of comparison lists for each of the defendants’ ranges of product, showing which products correspond to which L'Oréal perfume, infringed its registered trade marks for those perfumes,” he said.

Jacob LJ went on: “Does trade mark law prevent the defendants from telling the truth? Even though their perfumes are lawful and do smell like the corresponding famous brands, does trade mark law nonetheless muzzle the defendants so that they cannot say so?

“I have come to the conclusion that the ECJ’s ruling is that the defendants are indeed muzzled. My duty as a national judge is to follow EU law as interpreted by the ECJ. I think, with regret, that the answers we have received from the ECJ require us so to hold.”

Lord Justice Jacob said his “own strong predilection, free from the opinion of the ECJ” was in favour of free speech.

“Truth in the market place matters – even if it does not attract quite the strong emotions as the right of a journalist or politician to speak the truth.”

He said that any “suggested rule of law” which stood in the way of people telling the truth ought to be scrutinised carefully and justified “only on the grounds of strict necessity.”

He went on: “I regret that the ECJ in this case has not addressed the competition aspects of what it calls ‘riding on the coat-tails’.

“The trouble with deprecatory metaphorical expressions such as this (‘free-riding’ is another), containing as they do clear disapproval of the defendants’ trade as such, is that they do not provide clear rules by which a trader can know clearly what he can and cannot do.”

Lord Jacob warned that the consequence of the ECJ decision was that the EU would have a more “protective” approach to trade mark law than other major trading areas.

“I have not of course studied in detail the laws of other countries, but my general understanding is, for instance, that countries with a healthy attitude to competition law, such as the US, would not keep a perfectly lawful product off the market by the use of trade mark law to suppress truthful advertising.”

Jacob LJ agreed with the ECJ that the comparison lists used by the defendants fell within Article 5 (1)(a) of the Trade Marks Directive (EC89/104) banning the provision of signs or services identical with those for which the trade mark was registered.

The lord justice said he was “forced” to conclude that the use was not protected by Article 3(a) of the Comparitive Advertising Directive (EC84/450).

Although he did have to express a view on it, Jacob LJ ruled that the imitation products were also an infringement of Article 5(2) of the Trade Marks Directive.

Lord Justices Wall and Rimer agreed.

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Trade Police & Prisons Discrimination