Topic: Brands
Who: W.S. Foster & Son Limited, Brooks Brothers UK Limited and Mr Recorder Iain Purvis QC.
Where: Patents County Court, London.
When: 21 March 2013.
Law as stated: 29 April 2013
What happened:
The Patents County Court has found that the use of a fox and boot device by Brooks Brothers UK Limited (the “Defendant”), who are part of the American menswear group Brooks Brother Inc, on footwear sold in the UK amounted to passing off of W.S. Foster & Son Limited’s device. The court rejected the defence of honest concurrent use.
Peals & Co (“Peals”) a bespoke shoemaker (used by Winston Churchill and Fred Astaire amongst others) had used the fox and boot device on shoes since 1952. By the 1950s they sold products bearing this device in the USA through Brooks Brothers. When Peals ceased trading in 1964 they entered into an agreement of sale with Brooks Brothers in the USA whereby the goodwill (and expressly the unregistered trade mark of the fox and boot device) would pass to Brooks Brothers.
Meanwhile, in London after the demise of Peals, Mr Moore, an ex-Peals employee, moved to W.S. Foster & Sons (the “Claimant”), itself a long established shoe and bootmaker who then used the device on their own products. They presented themselves as the true heirs of Peals in terms of both personnel and quality.
In 2005 the Defendant opened its first store in the UK and began to sell shoes bearing a device incorporating the words “Peal & Co.”, an image of a fox above a boot in silhouette, below this the words “Leading Articles” and underneath this the words “Made in England Exclusively for Brooks Brothers Established 1818.”
After lengthy correspondence the Claimant issued proceedings against the Defendant on 12 March 2012 for passing off. The case came before the Patents County Court in February 2013 with Mr Recorder Iain Purvis sitting as Deputy Judge.
Passing off
The deputy judge assessed and applied the three elements of passing off stated by Lord Oliver in Jif Lemon.
(i) The branding in dispute must be distinctive and recognised by relevant customers as indicating products of the business carried on by the claimant under that brand. The fox and boot device used by the Claimant was “highly distinctive and memorable”. The products were only sold from one location but this was Jermyn Street, the premier area for men’s shoes in London and their shoes were bought by customers from 75 different countries. Therefore the Claimant’s device was clearly not restricted by locality. Customers recognised the device as the Claimant’s logo, which was reinforced by evidence given by Sir John Mitting, a High Court Judge and customer of the Claimant.
(ii) Misrepresentation by the defendant resulting, or likely to result, in the public believing that the defendant’s goods are made by or associated with the claimant. In the UK the device was no longer associated with Peals shoes. The public associated the Defendant’s device with the highly distinctive mark of the Claimant and would assume that the Defendant’s products were either made by the Claimant or connected or associated with it in some other way.
(iii) Damage. The Deputy Judge held that damage, by means of “blurring, diminishing or erosion” of the distinctiveness of the mark would be inevitable if the misrepresentation was allowed to continue.
Defence of honest concurrent use
The Deputy Judge also gave some useful commentary on the defence of honest concurrent use whereby a defendant can justify its use of the branding in question by citing their own goodwill built up separately and independently to that of the claimant. This defence is used in two circumstances. The first is when goodwill is built up in distinct locations which then collide due to increased trade. The second is where the goodwill is built up from a “common ancestor”.
The Defendant sought to run this defence here, but was unsuccessful.
Three requirements must be met to use this defence.
(i) The initial use of the goodwill must have been legitimate. The Deputy Judge agreed that the agreement with Peals meant that the Defendant had initially used the device legitimately.
(ii) At the time of the alleged passing off, the Defendant must have built up protectable goodwill in the sign. It was held that Brooks Brothers had abandoned the goodwill in UK associated with device.
They had not used business contacts and other assets in the UK acquired from Peals nor did it attempt to educate the public that it was their successor in the UK. The Deputy Judge concluded that the Defendant was content for the public to believe that Peals no longer existed and consequently abandoned their goodwill in the UK.
The Deputy Judge went on to consider whether the goodwill owned by Brooks Brothers in relation to the fox and boot device would have elapsed in any case between the demise of Peals and the Defendant’s sale of the goods in the UK from 2005. Although the Defendant claimed to have sold the shoes through a catalogue in the intervening period, there was little evidence to show that there was any significant trade. He concluded that, “Residual goodwill cannot seriously expect to survive 48 years with no use.”
(iii) The acts of alleged passing off should not be materially different from the way in which the Defendant’s branding was originally and legitimately used. The deputy judge concluded that, even if the Defendant had proven the survival of goodwill through the catalogue sales, this means of sale was of a materially different kind to the current activity through retail stores and their website. The defence would therefore have failed to meet this hurdle.
Why this matters:
This case gives us useful guidance on the defence of honest concurrent use in passing off proceedings and shows the potential barriers to the defence. In this case, the Defendant had acquired the rights but then had not sought to promote them in the UK for 48 years. Residual goodwill will not survive 48 years of non-use.
Moreover this case stresses the high threshold in relation to the third part of the test for honest concurrent use; changes of location, use of the mark or methods of trading are likely to result in the failure of the defence.
We have yet to see the last of this case as the action relating to the infringement of the Claimant’s Community Trade Mark had been stayed pending the outcome of this passing off action.
