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You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Evans & Anor (t/a Firecraft) v Focal Point Fires Plc [2009] EWHC 2784 (Ch) (10 November 2009) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2009/2784.html Cite as: [2010] RPC 15, [2009] EWHC 2784 (Ch), [2010] ETMR 29 |
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CHANCERY DIVISION
Strand, London, WC2A 2LL |
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B e f o r e :
____________________
| (1) William Evans (2) Susan Mary Evans (a partnership trading together as Firecraft ) |
Claimants |
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| - and - |
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| Focal Point Fires Plc |
Defendant |
____________________
Anna Carboni (instructed by Bird & Bird LLP) for the Defendant
Hearing date: 20th October 2009
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Crown Copyright ©
Peter Smith J :
INTRODUCTION
Firecraft
".
PRIMARY BASIS FOR THE CLAIMANTS' APPLICATION
Firecraft
" registered for inter alia "gas fires; electric fires; fires simulating fuel effect" in class 11 should be declared invalid.
Firecraft
is final and conclusive. They therefore contend that any attempt by the Defendant to challenge the Decision has no prospect of success because the decision has been determined against them either on the grounds of issue estoppel or cause of action estoppel. Alternatively if those contentions are not accepted the Claimants submit that it would be an abuse of the process to allow the Defendant to go behind the Decision.
Firecraft
since 2000).
Firecraft
in the future. In paragraph 30 of Mr Richards' witness statement dated 2nd October 2009 on behalf of the Defendant it was stressed that that was a commercial decision.
Firecraft
in reference to its products and cancelled the Defendant's registration for the domain names containing the mark
Firecraft
, and withdrew its trade mark application for
Firecraft
(trade mark No 2504899). They wrote to all stockists explaining the switch from
Firecraft
to the new name ekofires and asked them to remove all brochures and documents containing the
Firecraft
mark from the showrooms and replace all references to
Firecraft
on their websites and promotional material to Eco Fires. In June/July 2009 in the edition of the trade magazine "Fires and Fireplaces" they again set out the detail of the change of strategy.
BUSINESS BACKGROUNDS
Firecraft
in relation to the manufacture, sale and installation of stone fireplaces and the provision and supply of related goods and services. They have been in business as such since 1991 and contend now that the range of the business extends throughout England and Scotland. The business is extensively advertised by website, they are present at numerous exhibitions and they contend therefore they have acquired protectable goodwill associated with the word
Firecraft
.
Firecraft
".
Firecraft
mark on 29th February 2000 in class 11 which covers as I have said "gas fires; electric fires; fires simulating (sic) fuel effect; fire surrounds; fire fronts parts and fittings for all the aforesaid goods". It was advertised in the trade magazine Fires and Fireplaces in the summer of 2000.
Firecraft
which asserted goodwill under the name of
Firecraft
since 1992. It also received observations from Options
Firecraft
Ltd. Ultimately neither observation had any impact and the
Firecraft
mark was registered on 1st September 2000 under No 2 223 882.
Firecraft
product sold in May 2001. A website was developed and domain names were registered.
Firecraft
is in relation to fire surrounds whereas the Defendant's business which was carried on under the name of
Firecraft
related to fires.
INVALIDATION PROCEEDINGS
Firecraft
until May 2006 when the Defendant re-launched apparently the products under the name of
Firecraft
. That is not accepted by the Defendant. The Claimants accept that is an issue for later evaluation when the question of more specific relief (if any) is sought.
MATTERS FOR FUTHER CONSIDERATION
Firecraft
in the future and that it would result in it having to pay damages to the Claimants in respect of the past. I cannot comment on that and I do not accept any of it is relevant.
"(4) A trade mark shall not be registered if, or to the extent that, its use in the United Kingdom is liable to be prevented:
(a) by virtue of any rule of law (in particular the law of passing off) protecting an unregistered trade mark or other sign used in the course of trade, or
(b) by virtue of an earlier right other than those referred to in sub-section (1) to (3) or paragraph (a) above, in particular by virtue of the law of copyright, design right or registered designs.
A person thus entitled to prevent the use of a trade mark is referred to in this Act as the proprietor of an "earlier right" in relation to the trade mark."
Firecraft
and that would have entitled them to bring a claim for passing off proceedings. Thus they fairly and squarely needed to establish that they had a valid claim in passing off before the Hearing Officer in order to establish that the Defendant's registration was invalid. This was clearly set out and understood.
THE ACTUAL DECISION
Firecraft
was used by the Claimants and two other dealers meant that it was descriptive (as per the well known case of Office Cleaning v Westminster [1946] (63) RPC 39) he then concluded "I am satisfied that so far as the manufacturing of stone fireplaces was concerned, the name
Firecraft
was distinctive of [the Claimants'] business at the relevant date to a significant section of the trade and of the public".
Firecraft
between 2000 and 2006 but nothing turns on that for the present purposes.
(1) The Claimants goods or services have acquired a goodwill or reputation in the market and known by some distinguishing feature.
(2) That there is a misrepresentation by the Defendant (whether or not intentional) leading or is likely to lead the public to believe that goods offered by the Defendant are goods of the Claimant.
(3) That the Claimants have suffered or are likely to suffer damage as a result of the erroneous belief engendered by the Defendant's misrepresentation.
Firecraft
for selling fire surrounds although he equally accepted the Defendant never sold any fire surrounds. He nevertheless concluded "I have no misgivings in concluding that [the Claimants] had sufficient goodwill [by the relevant date] so as to found a passing off action." In paragraph 77 after acknowledging that the decision was not easy to make he came to the conclusion that the Defendant's use of
Firecraft
at the relevant date for fires would have deceived a number of the relevant members of the public and would therefore have amounted to misrepresentation. There was no evidence of actual deception but as he said people might have been deceived without realising it and it is a matter for the Court to infer whether or not there would be a deception.
Firecraft
name.
Firecraft
". In other words they acceded to the removal of the registration and the consequential rights attached to that registration but still remained in the field as regards the offending word. This is despite the fact that as I have set out above the Hearing Officer had satisfied himself that as at 29th February 2000 the Claimants had an actionable claim for passing off. His determination was that the Claimants would be entitled to an injunction as at that date and would "plainly" suffer damage to goodwill whether by lost sales or potential damage arising out of claims for bad quality goods against the Defendant affecting them.
Firecraft
in June/July of this year. Offering an undertaking might protect the Defendant as regards costs but the Claimants would clearly be entitled to have such an undertaking embodied in a Court Order in lieu of an injunction so as to ensure it is enforceable by committal.
CONSEQUENCES OF HEARING OFFICER'S DECISION
CAUSE OF ACTION ESTOPPEL
"The particular type of estoppel relied upon by the husband is estoppel per rem judicatam. This is a generic term which in modern law includes two species. The first species, which I will call "cause of action estoppel," is that which prevents a party to an action from asserting or denying, as against the other party, the existence of a particular cause of action, the non-existence or existence of which has been determined by a court of competent jurisdiction in previous litigation between the same parties. If the cause of action was determined to exist, i.e., judgment was given upon it, it is said to be merged in the judgment, or, for those who prefer Latin, transit in rem judicatam. If it was determined not to exist, the unsuccessful plaintiff can no longer assert that it does; he is estopped per rem judicatam. This is simply an application of the rule of public policy expressed in the Latin maxim "Nemo debet bis vexari pro una et eadem causa." In this application of the maxim "causa" bears its literal Latin meaning."
Firecraft
name) for infringement of the Defendant's still subsisting trade mark. The key to the result therefore is the issue as to passing off. That as I have said is not an academic decision because it has a real impact on the parties depending on the result.
ISSUE ESTOPPEL
"The second species, which I will call "issue estoppel," is an extension of the same rule of public policy. There are many causes of action which can only be established by proving that two or more different conditions are fulfilled. Such causes of action involve as many separate issues between the parties as there are conditions to be fulfilled by the plaintiff in order to establish his cause of action; and there may be cases where the fulfilment of an identical condition is a requirement common to two or more different causes of action. If in litigation upon one such cause of action any of such separate issues as to whether a particular condition has been fulfilled is determined by a court of competent jurisdiction, either upon evidence or upon admission by a party to the litigation, neither party can, in subsequent litigation between one another upon any cause of action which depends upon the fulfilment of the identical condition, assert that the condition was fulfilled if the court has in the first litigation determined that it was not, or deny that it was fulfilled if the court in the first litigation determined that it was."
Firecraft
if not restrained would amount to a misrepresentation in the future. I do not think the Decision properly read has that effect. It must be appreciated that the determination was made in 2008 in respect of events existing at 29th February 2000. It is difficult to see how his decision can be analysed 8 years after the relevant event as not amounting to a finding that as at the relevant date there was already an existing misrepresentation. In my judgment one has to look at what he has to decide. He does not have to decide evidence of actual misrepresentation. In effect he is rejecting the evidence of actual misrepresentation adduced by the Claimants but saying that it is clear that the use at the relevant date would have deceived a substantial number of relevant members of the public and would have amounted to misrepresentation but that the Claimants have not actually proved that at that stage. Nevertheless his decision is in effect that there must have been misrepresentation but on the evidence before him the Claimants have not made it out. It is not necessary for his decision to decide there was actual misrepresentation as the determination under section 54(a) TMA94 is that the trade mark's use is liable to be prevented…..by virtue of …. the law of passing off. Thus he determines the Claimants at the very least in my view would in the appropriate tribunal (not his) have a right to seek an injunction. That also of course given the fact that the Claimants did not issue until March 2009 means that the Claimants might not obtain injunctive relief as regards events that were established by the Hearing Officer as at 29th February 2000. However that would not preclude a claim for damages in lieu of an injunction as at that date. Thus on that analysis the Hearing Officer has in my view determined that the Claimants have a valid cause of action in passing off which is sufficient to prevent the use of the mark. That in my view would be the same requirement for the Claimants to establish passing off in this Court.
Firecraft
name. He does not have to attempt to quantify that because that is not a matter for him. He clearly, when one looks at paragraphs 77-82, is saying that common sense dictates that the use of the word
Firecraft
by the Defendant is almost inevitably going to cause damage. First the Claimants have established that there is a reasonable prospect of damage to goodwill on the 2 bases he suggested. That would lead again inexorably to a claim to injunctive relief. The Claimants therefore have been determined as having a valid cause of action in passing off in my judgment. Damages can be claimed in the action in the High Court if they are properly established at the inquiry stage; there is no need in my view for the Claimants to have to establish again the primary liability.
ABUSE OF PROCESS
"But Henderson v Henderson abuse of process, as now understood, although separate and distinct from cause of action estoppel and issue estoppel, has much in common with them. The underlying public interest is the same: that there should be finality in litigation and that a party should not be twice vexed in the same matter. This public interest is reinforced by the current emphasis on efficiency and economy in the conduct of litigation, in the interests of the parties and the public as a whole. The bringing of a claim or the raising of a defence in later proceedings may, without more, amount to abuse if the court is satisfied (the onus being on the party alleging abuse) that the claim or defence should have been raised in the earlier proceedings if it was to be raised at all. I would not accept that it is necessary, before abuse may be found, to identify any additional element such as a collateral attack on a previous decision or some dishonesty, but where those elements are present the later proceedings will be much more obviously abusive, and there will rarely be a finding of abuse unless the later proceeding involves what the court regards as unjust harassment of a party. It is, however, wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive. That is to adopt too dogmatic an approach to what should in my opinion be a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before. As one cannot comprehensively list all possible forms of abuse, so one cannot formulate any hard and fast rule to determine whether, on given facts, abuse is to be found or not. Thus while I would accept that lack of funds would not ordinarily excuse a failure to raise in earlier proceedings an issue which could and should have been raised then, I would not regard it as necessarily irrelevant, particularly if it appears that the lack of funds has been caused by the party against whom it is sought to claim. While the result may often be the same, it is in my view preferable to ask whether in all the circumstances a party's conduct is an abuse than to ask whether the conduct is an abuse and then, if it is, to ask whether the abuse is excused or justified by special circumstances. Properly applied, and whatever the legitimacy of its descent, the rule has in my view a valuable part to play in protecting the interests of justice."
SUMMARY JUDGMENT PRINCIPLES
AUTHORITIES
"opposition proceedings are inherently not final. They exist at the first stage of the process, before registration. By itself that would not be conclusive, but it seems to us that the fact that, at least, any unconnected third party could challenge the validity of the registration despite an unsuccessful opposition by another, and that, if that challenge were unsuccessful, there would be nothing which would bind the unsuccessful opponent (in contrast with the position of a party which has unsuccessfully applied at any rate to the Court; for a declaration of invalidity), shows that the decision of the Registry in opposition proceedings, or more generally a decision to register despite opposition, is not a final decision so as to be capable of being the basis for an issue estoppel. This is true both as regards the grounds of invalidity and as regards the issue of prior use more generally, as relevant to a passing off claim. The same wouldl be true of cause of action estoppel if, contrary to our views expressed above, there was a cause of action at that stage" (paragraph 71).
"We do not decide the position as regards the effect of an unsuccessful application for a declaration for invalidity to the Registry, which was the subject of the Hormel case. But proceedings in Court clearly do give rise to res judicata, in one form or another, and it seems likely that at the very least, an unsuccessful application for a declaration of invalidity in the Registry would preclude a later attempt to the same effect in the Registry, unless presented in reliance on new grounds not available on the first occasion."
"83 Counsel addressed to us various submissions based on the decision of Mr Arnold QC in Hormel, referred to above. That case was concerned with successive attempts by the same party to obtain a declaration of invalidity as to a trade mark under s.47, first from the Registry and then, based on different grounds, from the court. The Judge expressly distinguished a case involving prior opposition proceedings.
84 It seems to us that this is a crucial distinction. It does not seem to us to be necessary to decide whether Hormel was right. We can see more scope for arguing that it was, at least, an abuse of process to start two successive proceedings for a declaration of invalidity, one in the Registry and the other in the Court. But even if that decision was correct, it does not seem to us to follow that the same applies in the case of prior opposition proceedings. We are therefore not persuaded that the decision in Hormel, if right, requires that the appeal be dismissed, so that it is necessary to decide the correctness of that decision in order to allow this appeal."