The Business recently announced that iPod maker Apple is to make it clear to iPod accessory makers that they can only use iPod branding if they pay royalties. But what’s the position under UK law? Could Apple successfully sue purveyors of unauthorised iPod warmers?
Topic: Brands
Who: Apple Computer Inc.
Where: US
When: November 2005
What happened:
Apple announced a plan to crack down on manufacturers and retailers offering accessories for Apple's world beating iPod MP3. Apple has announced that only those retailers who pay its royalties will be entitled to claim that a particular product can be used in conjunction with the iPod.
Why this matters:
Under UK law, this Apple initiative will clearly have to be supported by legal action against those who don't toe the IT company's line. Such action would have to be based on a claim of either trademark infringement or passing off in order to succeed, and possibly for copyright infringement if artistic work, for example iPod advertising imagery, is also reproduced without proper authority.
Trade mark law wrestle
So far as a trademark infringement claim in concerned, Apple would have to wrestle with Section 11 (2) of the Trade Marks Act 1994. This provides that registered trademarks will not be infringed by "the use of indications concerning… the… intended purpose… of goods or services or the use of the trademark where it is necessary to indicate the intended purpose of the product (in particular, as accessories or spare parts), provided in both these cases the use is in accordance with honest practices in industrial or commercial matters."
On the face of it, if a particular product is manufactured for the sole purpose of being used in conjunction with or as an accessory for an Apple iPod MP3 device, it is difficult to see how Apple could persuade the Court to regard a straightforward reference to this in advertising by the accessory manufacturer as a trademark infringement.
Clearly this situation might be otherwise if the accessory advertising was in some other way misleading, thus falling foul of the 'in accordance with honest practices' ingredient of the defence.
Passing off?
Assuming the accessory maker successfully ran a Section 11(2) defence, could it still be liable for passing off? We believe this is unlikely, because the requirement in the tort of passing off for misrepresentation is closely equivalent to the "lack of honest practices" ingredient in a trademark infringement finding. This would mean that if the accessory advertiser is regarded as conforming to honest practices and therefore able to run the Section 11(2) defence, it seems unlikely the advertisement could at the same time be regarded as a misrepresentation and therefore an actionable passing off.
It will be interesting to see how Apple fares in its efforts to clamp down on unauthorised use of its branding in this burgeoning market. The UK Trade Marks Act rules we mentioned above are replicated pretty much across the European Union, so its task may be especially hard on this side of the Atlantic, although there can be no doubt that in many instances accessory makers go well beyond legitimate use.
