Who: Comic Enterprises Ltd v Twentieth Century Fox Film Corporation (“Fox”)
Where: The High Court
When: 17 July 2014
Law stated as at: 6 November 2014
The High Court has recently awarded remedies in the Comic Enterprises v Fox case pending the appeal hearing.
In February 2014, the High Court ruled that Comic Enterprises’ registered trade mark “The Glee Club” was infringed by Fox’s hit television series ‘Glee’.
Comic Enterprises sought the following remedies: (a) an injunction to restrain further trade mark infringement; (b) delivery up or destruction of infringing materials; (c) the option of an account of profits and disclosure of sufficient information to enable it to make an informed decision as to whether to opt for damages or an account of profits; (d) a publicity order; and (e) an interim payment.
Fox disputed these and also sought a stay of relief until the outcome of the appeal.
The Court’s decision on the remedies is summarised below.
After taking into account all of the factors in the case, the Court ruled that it would be fair and equitable to grant an injunction. Fox’s claims that re-titling the series and publicising the new title would be prohibitively expensive were rejected given that this “blockbuster” series is a “substantial commercial success and should be able to bear the extra cost”. The Court would allow Fox to refer to the fact that the programme had been “previously known as “Glee””. The Court also suggested that Fox could choose a new name which has an immediate association with the programme, for example the name of the high school, to help the public identify the re-titled series.
The Court ruled that it was proportionate to order delivery up, or relabeling where appropriate, of physical and digital copies of the programme in Fox’s control. It would not be difficult or expensive for Fox to do so. However, the Court held it would not be proportionate to make Fox try and recover copies of the programme that it had already sent to its customers, despite it being technically possible for Fox to do this.
Account of profits and disclosure
Comic Enterprises could opt for an account of profits. This was because, whilst Fox had initially been an innocent infringer without actual or constructive knowledge of Comic Enterprises or its trade mark, when Comic Enterprises did make Fox aware of its trade mark, Fox continued to infringe. Furthermore, unless it could be said that the title ‘Glee’ had only made a de minimis contribution to the success of the series, the fact that its contribution might only be small should not prevent Comic Enterprises from opting for an account of profits.
Disclosure was ordered so Comic Enterprises could make an informed decision about opting for damages or an account of profits. There was no need for Fox to produce extensive disclosure. Instead, Fox should make a rough assessment of the value of the UK market’s contribution to the total profit of the series and provide an explanation for the basis on which it made this calculation.
Whilst this case has generated a large amount of publicity, none has been expressly directed at the viewers of the show. Consequently, the Court granted a publicity order because it was important to make viewers of the show aware of this judgment.
Although it would be difficult to assess the quantum of damages/account of profits that would eventually be awarded, the Court held that this did not prevent an interim payment order, provided that the amount was conservative. Given that the Court had little information to guide it on the likely quantum, an interim payment of £100,000 was ordered. However, the Court emphasised that this was an “extremely conservative figure for the sum that may be awarded to Comic Enterprises”.
The injunction was stayed until the outcome of the appeal on the basis that if it was overturned on appeal, Comic Enterprises would be unlikely to be able to recompense Fox.
The publicity order was not stayed. The majority of the damage to Comic Enterprises’ trade mark had already been caused and further damage could be limited by requiring Fox to comply with the publicity order.
The interim payment was not stayed because Comic Enterprises would be able to repay the £100,000 if the High Court’s decision is overturned.
Why this matters:
This case is an important reminder of the importance of carrying out clearance searches before launching a new brand, and of the risks of proceeding in the face of potential challenges. Organisations should carry out searches in all of the territories where they plan to use the brand because, whilst a mark may be unencumbered in one territory, it could already be protected in another. A great deal of time and expense can be incurred if this initial due diligence is not carried out – or if the organisation chooses to push ahead in the face of arguably conflicting prior marks.
On this particular case, we now await the outcome of Fox’s appeal.