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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> 1-800 Flowers Inc v Phonenames Ltd [2001] EWCA Civ 721 (17 May 2001) URL: https://www.bailii.org/ew/cases/EWCA/Civ/2001/721.html Cite as: [2002] Masons CLR 5, (2001) 24(7) IPD 24042, [2001] EWCA Civ 721, [2001] 2 Costs LR 286, [2002] FSR 12 |
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT,
CHANCERY DIVISION (Mr Justice Jacob)
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE BUXTON
and
LORD JUSTICE JONATHAN PARKER
____________________
1-800 FLOWERS INC | Applicant |
|
| - and - |
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PHONENAMES LTD |
Opponent |
____________________
Smith Bernal Reporting
Limited,
190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
Mr Mark Platts-Mills QC and Mr James Abrahams (instructed by Messrs Field Fisher Waterhouse for the Opponent)
____________________
VERSION
OF JUDGMENT
Crown Copyright ©
LORD JUSTICE JONATHAN PARKER:
INTRODUCTION
Flowers
Inc
("the Applicant") against a decision of Jacob J made on 20 December 1999 (and reported at [2000] FSR 697) whereby he allowed an appeal by
Phonenames
Ltd ("the Opponent") against a decision of the Registrar of Trade Marks.
FLOWERS
in respect of services consisting of the receiving and transfer of orders for
flowers
and floral products. Notice of opposition was given by the Opponent. On 17 December 1998 Mr M. Knight (Principal Hearing Officer acting for the Registrar of Trade Marks) issued a decision rejecting the grounds of opposition relied on by the Opponent and accepting the mark for registration in Part B of the Register subject to a disclaimer of the right to exclusive use, separately, of the numeral "800" and of the word "
Flowers".
The Opponent appealed to the High Court. Jacob J allowed the appeal and ordered that the application for registration be refused. He also ordered the Applicant to pay the Opponent's costs of the appeal, which he summarily assessed under CPR Part 43.
THE PARTIES
The Applicant
incorporated
in the United States, which carries on an international floral telemarketing business; that is to say, it provides cut
flowers,
plants and other floral products
via
a marketing system accessed by telephoning "freephone" numbers or their equivalent (such numbers are known in the United States as toll free numbers) or
via
the Internet or through customers
visiting
the Applicant's
various
retail outlets. In the United States, the toll free number which accesses the Applicant's marketing system is 1-800-356-9377. Expressed in "alpha-numeric" terms (that is to say, using a telephone keypad which has letters on it as well as numbers and dialling by reference to the letters) the toll free number is the equivalent of 1-800-
FLOWERS.
Flowers
Inc
(another US company), from whom it acquired its business.
Flowers
Inc
was acquired by the McCann family, and since then the business has been run by two members of that family, namely Mr James McCann and Mr Christopher McCann, who are brothers. The evidence in support of the application for registration consists of statutory declarations by Mr Christopher McCann ("Mr McCann").
flower
shops in the United States, building up a chain of retail floral stores. By 1986 there were 12 such stores in the New York area. In paragraph 4 of his first statutory declaration in support of the application, Mr McCann says that when his family purchased a controlling interest in 800-
Flowers
Inc
they "literally started over again". He continues:
"We were purchasing stock in a corporation whose primary assets were its registered United States service marks DIAL 800-FLOWERS
and 800-
FLOWERS,
which were accorded
incontestable
status, and the right to use the telephone number 1-800-356-9377, which corresponds to 1-800-
FLOWERS.
With these assets we believed that we could build a nationwide floral telemarketing business from a struggling company that unquestionably required new management and a commitment to marketing principles that we undertook to establish and implement."
"5. In October 1986, my Company was a floundering business. Since I have been involved in its management, my Company has invested millions of dollars and enormous time and effort to enhance its name and brand recognition throughout the United States. 800Flowers
is the mnemonic for the toll free number by which customers can place orders with my Company but it is also my Company's corporate and trade name as well as an internationally recognized and well known Trade Mark. Customers choose to do business with my Company because of the world renown of the Company name and Trade Mark 800-
FLOWERS.
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6. My Company's advertising efforts have occurred at national, regional and local levels, and we have advertised in all mediums,
including
television, radio, print billboards and, more recently, on the "internet". Our advertising and promotional efforts have been devoted to establishing positive consumer association between the products, the trade name of the Company and the 800-
FLOWERS
"brand"."
FLOWERS
is recognised in many countries. In paragraph 16 of his statutory declaration he says this:
"My Company has a largevolume
of international sales under the Trade Mark 800-
FLOWERS.
In fiscal year 1996 international sales were in the region of $250million (£183million) with sales taking place in over 85 countries."
The Opponent
include
ice cream sales, paint shops, trailers, silencer shops and mobile car tuning. Mr Zockoll describes the group as an extremely enterprising and growing group with a
variety
of experience in franchising and licensing operations.
phonenames
business" on behalf of the group. In paragraph 7 of his first statutory declaration he describes the Opponent's business as follows:
"The Opponents are the company responsible for promoting and marketing the alpha-numeric concept. This involves educating the consumer about what numbers go with what letters to form a standard keypad. This is accomplished, for example, by showing consumers and our potential licensees samples of standard keypads and producing templates to fit over existing telephone keypads. It is necessary to educate the consumer to use the letter "O" (not the number "0") when dialling aphonename.
The Zockoll Group leases the telephone numbers from the service providers and licenses them to third parties through the Opponents."
"The Opponents intend to license or franchise the use of trade names. The Opponents have uninterrupted rights to use, for example, the telephone number 0800 758 6237 which translates to the phone name 0800 PLUMBER."
via
an appropriate alpha-numeric number. However, whereas in the case of "origin dependent routing" an arrangement is made with the service provider (e.g. British Telecom or Mercury in the United Kingdom) whereby calls are automatically routed to the trader who is situated nearest to the customer, in the case of "central marketing" all the enquiries will be received on a central number and will then be re-routed to a local trader. Whichever method is adopted, the Opponent receives royalties from its licensees (within the group and outside it) for the use of trade marks and
phonenames.
"It is convenient and of enormousvalue
for small companies who can be licensed by us for the use of a generic
phonename
as it offers them great opportunities to establish a
valuable
brand which normally they could not afford. Many such opportunities would be lost if the market for generic
phonenames
did not exist. The concept of telemarketing is becoming
increasingly
popular, not least because of the convenience to the consumer."
THE APPEAL
The relevant statutory provisions
virtue
of section 105 of, and paragraph 10 of Schedule 3 to, the Trade Marks Act 1994 the application for registration falls to be dealt with in accordance with the 1938 Act.
"10(1) In order for a service mark to be registrable in Part B of the register it must be capable, in relation to the services in respect of which it is registered or proposed to be registered, of distinguishing services with the provision of which the proprietor of the mark is or may be connected in the course of business from services with the provision of which he is not so connected, either generally or, where the service mark is registered or proposed to be registered subject tolimitations,
in relation to use within the extent of the registration.
(2) In determining whether a service mark is capable of distinguishing as aforesaid the tribunal may have regard to the extent to which:
(a) the service mark is inherently capable of distinguishing as aforesaid; and(b) by reason of the use of the service mark or of any other circumstances, the service mark is in fact capable of distinguishing as aforesaid......"21. Section 11 of the 1938 Act provides as follows:
"It shall not be lawful to register as a service mark .... any matter the use of which would, by reason of its being likely to deceive or cause confusion or otherwise, be disentitled to protection in a court of justice, or would be contrary to law or morality, or any scandalous design."
"(1) Any person claiming to be the proprietor of a service mark used or proposed to be used by him who is desirous of registering it must apply in writing to the Registrar in the prescribed manner for registration either in Part A or in Part B of the register.(2) Subject to the provisions of this Act, the Registrar may refuse the application, or may accept it absolutely or subject to such amendments, modifications, conditions of
limitations,
if any, as he may think right."
".... a mark (including
a device, name, signature, word, letter, numeral or any combination thereof) used or proposed to be used in relation to services for the purpose of indicating, or so as to indicate, that a particular person is connected, in the course of business, with the provision of those services, whether with or without any indication of the identity of that person."
"... their provision for money or money's worth."
".... shall be construed as references to the use of a printed or othervisual
representation of the mark, and references therein to the use of the mark in relation to services shall be construed as references to the use of the mark as or as part of any statement about the availability or performance of services."
The Opponent's Grounds for Opposition
FLOWERS
has been allocated to the Opponent, the use of the mark by the Applicant would be likely to deceive or cause confusion, by reason whereof the Applicant would be disentitled to protection in a court of justice, and that accordingly registration of the mark would be contrary to section 11 of the 1938 Act;
The Decision of the Registrar
".... that the term 800-
FLOWERS
represents an allusion to the service provided."
"Perhaps it is not the most covert and skilful of allusions, based upon the combination of two non-distinctive elements, but definitely an allusion. I find, therefore, that that trade mark is capable of distinguishing the services of the applicant from those of other providers and so I dismiss this ground of opposition based upon section 10 of the [1938] Act."
"In the circumstances, it seems to me that the applicants, if their trade mark is registered, will have the right to stop anyone else using the trade-mark 800-FLOWERS
in respect of the same or similar services for which the trade mark is registered and that right will predate the right the opponents have obtained in respect of telephone number 0800 3569377. Therefore, it is use of the alpha-numeric
version
of the telephone number by the opponents which is likely to cause confusion and deception." (My italics.)
"In so far as the use of alpha-numerics asphonenames
is concerned I have no doubt that the public at large have yet to become accustomed to their use. No evidence has been adduced by the opponents to show that, whatever may be the position in the United States of America, they are a settled part of business practice here in the United Kingdom. And even if
phonenames
were
increasingly
becoming a feature of every day life I would not consider that a phone name constructed from a telephone number should put the holder into an advantageous position over the owner of a similar (or the same) earlier trade mark. Unless, of course, an applicant for registration had by their [sic] actions put themselves in a position, as a result of some illegality, of being disentitled to protection in a Court of Law. No evidence has been adduced that they have done so in this case. Thus, there is no reason to believe that any use by the applicants of their 800-
FLOWERS
trade mark is likely to lead to deception and confusion as to source of origin in relation to the use by the opponent of the telephone number 0800-3569377 and I have no evidence before me that the applicants have taken any action themselves which would render the trade mark deceptive or in any way disentitled themselves from protection. (Indeed the applicants' interest in obtaining the telephone number 0800-3569377 from the opponents indicates that they have attempted to take action to ensure no confusion.) I therefore dismiss the grounds of opposition founded on section 11 of the [1938] Act."
"I can see no reason why the trade mark in suit cannot be used in relation to a telephone number other than 0800-3569377: especially when the majority of the population are not educated in the use of alpha-numerics (and who may not even possess telephones with alpha-numeric annotations)."
The judgment of Jacob J. on the substantive appeal
"It is fair to assume at the date of the application, early 1993, the return of letters to telephones was clearly both foreseeable and intended. And so it has been. Modern telephones all have letters on their number buttons. I suspect that most people who have had a new phone in the last few years do not yet make use of the letters: some [may] have wondered why they are there and others may not even have noticed them. But there can be no doubt that alpha-numeric buttons are here to stay and that people will gradually make more and more use of them for telephone number purposes (they have other uses too).....Technical developments in the phone industry have meant that telephone numbers no longer have as much "locality" about them. In particular freephone numbers have none. This makes it possible to run a nation-wide franchising business using just one number. You can have a central operator system to take "orders" or to put you in contact with the local franchisee. It is also possible for the telephone company to arrange that its system itself detects the locality of a caller and routes the phone call to the nearest centre using that number ("origin dependent routing"). In that way the "owner" of the number can license the number to a
variety
of different users.....
In the USA knowledge and use of alpha-numeric numbers were more advanced by 1993. Many telephones already had letters indeed I am not sure that letters were ever wholly abandoned. By 1993 the applicants had a substantial US business. The general freephone number in the US is 1-800 (number). The applicants have the number corresponding to 1-800
FLOWERS.
If you phoned that number in the US in 1992 you could place an order for
flowers
to be delivered anywhere in the world. The order would be taken and transmitted
via
an intermediary to a local
flower
shop...."
"Although the applicants claim some use in the UK before their date of application they do not suggest that by reason of that use their mark acquired any factual distinctiveness. So the question is whether the mark is "capable of distinguishing" having regard to its inherent nature.I have come to the conclusion that it is not. Consider first the position if the mark had been 0800
FLOWERS.
At the time of application the number 0800 was, as Mr Hobbs QC for the applicants, conceded "freighted with telephonic significance". That does not mean, however, that the general public would at the time have realised that the whole mark was something that you could actually dial. At that time the use of letters on buttons had only just commenced and there can have been few telephones which carried letters. Nor had there been any education of the public about the letters. So at the time of application the public would have been puzzled by the mark 0800 says something about freephone, but
FLOWERS
would have little meaning, so somewhat "de-freighting" the mark as a whole. The mark would, however, not have been a puzzle to anyone who knew of the coming return of letters to phone buttons. He or she would have understood at once that 0800
FLOWERS
was an encoded phone number and particularly so in relation to the specification of services, namely receiving and transmitting orders for
flowers.
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[The Hearing Officer] accepted that 0800
FLOWERS
did not have any inherent capacity to distinguish in 1993.... He was right because, anyone knowing the facts would say, correctly, that the mark had a direct reference to the character of the service to be provided under the mark. Section 10 in its reference to "capacity" to distinguish must
include
within its scope the foreseeable future. In the future, as perceived in 1993, 0800-
FLOWERS
would
very
likely be taken by anyone knowing the facts to be a phone number for ordering
flowers.
That would be so, whether or not anyone actually used that number for that purpose in the future it would be the future growth in the practice of traders generally to use 0800 (word) which would have that effect. So the mark would convey a clear descriptive meaning in the future, irrespective of any use by the mark owner."
"I think it is more than a mere allusion. Once people became aware that 0800 (word) marks worked, they would inevitably see this mark as the 0800 (word) with the zero missing. This is particularly so given the specification of services, namely taking and transmitting orders. One of the most obvious ways of doing that is by telephone. I would add that many people would also be aware that an initial zero is the way into many telephone numbers you use it when you are not making a local call (either national or international) and for other freephone services such as that of Mercury (now AT&T) which begin 0500....Of course in so saying I am not saying the mark could not also be used in other ways. In principle it could be used for the name of a shop (odd though that might be) and it could be used as a company name or domain name. But these other possible uses do not disguise the real substance of the mark. It is indeed
virtually
0800
FLOWERS.
It forms the heart of that alphanumeric number.
Two further factors reinforce this conclusion. Firstly there is no escape from the fact that the applicants themselves intended that the mark be understood as a telephone number in the future. That is their whole, or at least their substantial purpose in applying for the mark. They want a trade monopoly which covers 0800
FLOWERS.
This registration, if granted, would give them just that. Secondly in support of their application the applicants have sought to allege actual use of the mark. But what they claim to have used in the UK is only the US equivalent of an 0800 number, namely 1-800-
FLOWERS.
I think they are right in saying that use of 1-800
FLOWERS
would be a use of 800
FLOWERS,
but it follows that use of 0800
FLOWERS
is also use of 800
FLOWERS."
"This provision normally is applied to situations where there is a prior mark in use which is said to conflict with the mark proposed for registration. But it covers other situations too any situation where the use of the mark propounded will lead to deception or confusion of the public would be treated in a court of justice as disentitling the mark to protection.Now at the time of application the applicants had not obtained the telephone number corresponding to 0800
FLOWERS.
So, if and when that number was allocated to someone else and upon the assumption that the trade mark was put into use, a deceptive situation was bound to arise. When the public phoned 0800
FLOWERS,
as they would be bound to do, they would get a wrong number. And the "owner" of the number (who has to pay for the freephone calls to it) would find himself paying for those calls. The use of the trade mark was therefore bound to lead to confusion and deception unless and until the applicants themselves obtained the number.....
Mr Hobbs QC, for the applicants, submitted that this was putting the cart before the horse. He said it was objectionable for the registration of a trade mark to depend upon who had got the telephone number it was making the trade marks register subservient to the telephone companies. I do not see why it is objectionable. Registration of a trade mark is to protect trade marks. If external factors such as who has the telephone number make the mark deceptive in the hands of the applicant that is just a fact which makes the mark deceptive. For instance the registrar will normally allow registration for a mineral water of the name of the source but only the owner of the source may obtain registration precisely because in other hands the mark would be deceptive. I think this is a fair analogy: although the "owner" of a telephone number does not have the same legal security over the number as the landowner may have over a mineral water source, he is reasonably secure in his number as recent litigation about telephone numbers has shown.
I think, therefore, that registration would be contrary to section 11. In this connection [the Hearing Officer] seems to have rather misunderstood the argument below. It is not so much that the phone number belongs to the opponents (as it does) but that it does not belong to the applicants and did not at the date of application. [The Hearing Officer] could not see how the obtaining of the number by the opponents could disentitle the applicants to protection in a court of law. But it was not the fact that the opponents obtained the mark which mattered. What mattered is that at the date of the application confusion was likely indeed inevitable so soon as the public were educated about 0800 (word) numbers and the mark was put into use. [The Hearing Officer] gave credit to the applicants for trying to obtain the number or its use as attempting to ensure no confusion. But that is because at the time of the application confusion would be inevitable unless they obtained the number or the right to use it."
variant
0800
FLOWERS,
a mark which is unregistrable; that, he said, was not only the common sense of the position but also an exact description of the Applicant's stated position. He continued (at p.704):
"Mr Platts-Mills [for the Opponent] points to the inter partes correspondence in which the applicants were seeking to obtain the rights to or at least the right to use the telephone number 0800FLOWERS.
In 1995 one of their letters concerning this expressed the
view
that "several things right now are waiting on the completion of our deal with you so that we may get moving in the European market". That indicates as clearly as anything that up until then the applicants did not regard themselves as having got going here and that they needed the number to get going a mere conditional intention to use.
So I do not think the applicants can claim that 800
FLOWERS
in their hands is properly a trade mark or that they are properly proprietors. That their intention was purely conditional, if and when they get the use of the number, is not good enough."
FLOWERS
was not evidence of use in the United Kingdom. He continued (at the foot of p.704):
"Nor does the detailed evidence put forward amount to use of the mark here. It shows that some people with UK addresses for their credit cards have used the US number 1-800FLOWERS.
It is unlikely that those people were in the UK and asking for
flower
deliveries for someone in this country. The customer was either in the US already and had a UK credit card or, perhaps, was in the UK, knew about the applicants' US number and telephoned them there for
flower
delivery in the US. The evidence also shows that
flowers
have been delivered to people in the UK following use of the applicants' services. This must surely be US customers asking for delivery to UK addresses."
FLOWERS
was not, in the circumstances of the instant case, evidence of use of the mark in the UK. The judge regarded it as being of significance in this respect that the relevant service would be provided in the US. He expressed his conclusions thus (at p.705):
"So I think that the mere fact that websites can be accessed anywhere in the world does not mean, for trade mark purposes, that the law should regard them as being used everywhere in the world. It all depends upon the circumstances, particularly the intention of the website owner and what the reader will understand if he accesses the site. In other fields of law, publication on a website may well amount to a universal publication, but I am not concerned with that.But even if Mr Hobbs were right in saying that website use amounted, for trade mark purposes, to use in omnipresent cyberspace, I cannot see how that would help here. If you access the applicant's site in the UK, you can orderflowers.
But the service of receiving and [transferring] (i.e. the service of the specification) is carried out wholly in New York. ......
In the result, I do not think that the applicants have the requisite intention to use or in fact use the mark 800
FLOWERS."
The arguments on the appeal
version
of a UK telephone number. He points out that 800
FLOWERS
in not a UK telephone number, and that the judge was in error in proceeding as if it was. In any event, he submits, it is in itself no objection to the registration of a mark consisting of a series of numerals that those numerals may also be a telephone number.
various
judicial references to the lack of public awareness in the UK of the availability or use of
phonenames
during the 1990s.
phonename.
As to the minority of members of the public who would or might recognise the mark as a
phonename,
he submits that those would be the
very
people would also know that it was a
phonename
specific to the Applicant, so that in their minds the mark would be sufficiently distinctive.
FLOWERS
can readily be used as a trade name of a particular supplier, notwithstanding that it resembles a telephone number.
phonename,
it can still be used without deception or confusion. Further, he submits that in so far as there might be any risk of deception or confusion in the UK, that risk has been created by the Opponent's subsequent and adventitious acquisition of the relevant UK telephone number.
FLOWERS.
FLOWERS
were disentitled to such protection in the United Kingdom no matter how well-known the mark may be elsewhere.
v.
Griffiths [1995] RPC 16 CA.In that case the defendant had obtained a telephone number which was confusingly similar to a number allocated to the Law Society in respect of which the society had launched a scheme called "Accident Line". The Law Society commenced a passing off action and successfully sought injunctive relief. Mr Hobbs points out that it was not contended by the defendant in that case that the Law Society was disentitled to protection in respect of its telephone number because it did not also have the defendant's number. So in the instant case, he submits, the existence of the confusingly similar number 0800
FLOWERS
ought not to disentitle the Applicant to protection in respect of its mark. In the circumstances, the link which the Opponent seeks to establish between the mark and the UK telephone number is, he submits, an "illicit equation".
v.
One in a Million Ltd [1999] FSR 1 CA, where the court granted relief in passing off and for infringement of registered trade mark to prevent the use of deceptive domain names. He submits that where a claimant in such an action has a trade name, it is not disentitled to relief simply because the defendant has a telephone number which can be converted into it.
FLOWERS
is to gain practical control of the UK telephone number 0800
FLOWERS.
The Applicant, he submits, wishes to use its US number 1-800-
FLOWERS.
v.
Comptroller of Customs (Mauritius) [2000] IP & T 735 (PC) and Globelegance BV
v.Sarkissian
[1974] RPC 603, 613 per Templeman J (a passing off case). Mr Hobbs further points out that in CHIPIE there was no exposure of the goods in question to the public at large in Mauritius; the production of goods exclusively for export was held to be sufficient to found a right to the mark in Mauritius.
v.
Muhlens (1953) 70 RPC 235 (CA) as authority for the proposition that it is not necessary that an infringer should have an intention to trade in the goods in question in the UK and that the infringer's trading activity may be outside the UK.
FLOWERS
is being used simultaneously both in the US and in the UK. In this connection he refers to the uncontradicted evidence that calls to the Applicant's US telephone number have been made from the UK.
Inc
v.
Budejovicky Budvar [1984] FSR 413 CA (better known as "The Budweiser Case")). He has referred us to the decisions of Browne-Wilkinson
V-C
in Pete Waterman Ltd
v.
CBS United Kingdom Ltd [1993] EMLR 27 and of Knox J in Jian Tools for Sale
Inc
v.
Roderick Manhattan Group Ltd [1995] FSR 924 as demonstrating what he describes as the more lenient approach adopted by the courts in recent years to the fulfilment of that requirement. He relies in particular on Browne-Wilkinson
V-C's
conclusion in Pete Waterman (at ibid. p.58) that:
"The presence of customers in this country is sufficient to constitute the carrying on of business here whether or not there is otherwise a place of business here and whether or not the services are provided here. Once it is found that there are customers, it is open to find that there is a business here to which the local goodwill is attached."
FLOWERS.
He submits that although the available evidence does not enable the court to ascertain how many times the website has been accessed from the UK, the mere fact of internet activity is enough to establish an intention to use the mark in the UK for the purposes of sections 17 and 68.
FLOWERS
in conjunction with the corresponding UK telephone number, and that it is not and has never been the intention of the Applicant to carry on business in the UK by reference to the US telephone number 1-800-
FLOWERS.
flower
motif, with instructions as to how the US telephone number could be accessed
via
a special AT&T number (which was not given).
FLOWERS
clearly has telephonic significance; and that it is not distinctive for the purposes of section 10.
value
of the mark lies in its connection with the UK telephone number, and that just as 0800-
FLOWERS
would be
incapable
of distinguishing between services of the relevant type provided by the Applicant and those provided by others, so is the mark similarly
incapable.
FLOWERS.
He submits that it is nothing to the point that the mark may be used in other ways: any fair and reasonable use of the mark has to be taken into account in deciding whether there is a likelihood of deception or confusion.
phonename
would inevitably conclude that the Applicant had the corresponding UK telephone number.
"I would like to thank you for your efforts to date in helping us to start operating our business in Ireland. As you and I have spoken, we have been trying to establish a presence in the UK and Ireland for some time now.The only thing blocking us in the UK to date has been attaining the 0800 356937 [sic] number from BT. We were contacted by a person by the name of Jim Zockoll approximately one year ago who had the 0800 356937 number and wanted to sell it to us. We have been trying to reach an agreement with Mr Zockoll during the course of this past year, until such time when we realised that the laws governing the brokering of telephone numbers in the UK are quite different than they are here in the US. Upon finding this out, recently we have ceased to contract with Mr Zockoll and are pursuing other routes. It was also brought to our attention that when we requested the corresponding number from Telecom Eireann for use in Ireland that Jim Zockoll was an impediment to our establishing our business in Ireland as well.
Once the hurdles of attaining these numbers are overcome, we plan to move ahead in establishing a point of presence for our business in the European Community, specifically starting off with Ireland and then the UK. ...."
vanishingly
small"; and that the nature of the use is not such as to amount to use in the UK, let alone a bona fide use such as is required by the 1938 Act.
Conclusions on the appeal
phonenames
in the UK was reasonably foreseeable in February 1993.
phonenames
in the UK was reasonably foreseeable in 1993. The fact that in 1993 the public needed to be educated in the use of alpha-numeric keypads, and that at that time relatively few members of the public would have recognised the potential of alpha-numeric
phonenames,
does not answer the question whether the widespread use of alpha-numeric
phonenames
in the UK was at that time reasonably foreseeable: it merely demonstrates that it had not yet happened. Yet by 1993 the use of alpha-numeric
phonenames
had for some time been widespread in the US; and so far as the Applicant itself is concerned Mr McCann's evidence is that during 1994 the Applicant received some 4 million calls to its US alpha-numeric telephone number 1-800-
FLOWERS,
and, as noted earlier, the Applicant has maintained an interactive website since 1992 with the address www.1800flowers.com. Moreover, the plain inference is that in 1993 the Applicant itself foresaw that the use of
phonenames
would become
increasingly
common in the UK and (one may assume) elsewhere, and that it was the perceived existence of an opportunity for the commercial exploitation of a
phonename
in the UK which prompted its application to register the mark 800-
FLOWERS
in the UK.
FLOWERS,
Mr Hobbs described the mark as "nationality neutral" a reference, as I understand it, to the fact that in some countries (
including
the UK) the prefix of a freephone number is 0800 whilst in others (
including
the US) it is 1800. As I see it, this merely serves to confirm that the mark 800-
FLOWERS
was adopted by the Applicant because of its telephonic significance, in that it represents that part of the corresponding freephone number which is common to all those countries which operate a freephone system using the prefix 0800 or 1800.
view
that the inherent distinctiveness of the mark in 1993 has to be judged against the background of the
increasingly
widespread use of
phonenames
in the UK.
v.
Griffiths (above) provide any support for the Applicant in this connection. The ratio of the decision in that case is to be found in the passage in the judgment of Aldous J where he said (at p.21 line 23):
"A person who adopts the mantle of another can by his silence represent that he is that other. Thus a person who selects a confusingly similar telephone number or a similar name may well represent that he is that other by either saying so or by failing to take steps when telephoned or called to disabuse the person who is making the telephone call. A person who takes steps which will lead a person who acts in a particular way to conclude that his business is that of another is guilty of passing off just as much as a person who states that his business is that of another."
v.
One in a Million Ltd (above).
"From the material which was placed before the Comptroller, it is clear that labels displaying the name "Chipie" were sent to Mauritius by the [opposing party] and applied to garments manufactured in Mauritius by a firm called Cogimex (Mtius) Ltd. This was clearly done on a significant scale. Furthermore, there were a number of invoices produced relating to sales transactions passing between the [opposing party] and Cogimex in the course of which the former used the name "Chipie". A question was raised by counsel for the appellant regarding the propriety of taking account of manufacturing work where such work was carried out within an exclusive export zone, that is to say a zone set apart for the purposes of fiscal provisions in which goods manufactured exclusively for the export market could be carried on. But that has not been presented as a live question in the instant case and there is no finding that in fact the manufacture on which the [opposing party] found was conducted in such a zone. A broader issue raised was whether manufacture for export would qualify as user for the relevant purpose."
"Their Lordships are satisfied that the foregoing activities amounted to user of the [opposing party]'s mark in Mauritius since 1987, that is before the appellant began to use it, and that the user was quite sufficient to give the [opposing party] the right to use the mark in Mauritius so as to make it impossible for the appellant to claim a right for the purposes of [the relevant statutory provision]."
THE CROSS-APPEAL
"Following their success on this appeal, the opponents sought summary assessment of costs. The sum they were seeking was £38,000 for the matter before me. There is an undisputed figure of £3,000 odd resulting from a half day application before Evans-Lombe J. When they saw which way the wind was blowing, Mr Platts-Mills suggested there should have been a detailed assessment. I rejected that.This case, just like the case before me last week of ELLE Trade Mark, is an appeal from the Trade Mark Registrar. The appeal was on the documents below. There was no disclosure, there were no witnesses, there were no witnesses to be interviewed; it was simply an appeal on the documents below. The appeal lasted, essentially, one day, as did the case last week.
It is quite true that this case has been seen as of considerable importance by both sides. Financially that must be so, but a figure of £38,000 for a paper only one-day case in the High Court is simply, in common parlance, out of order. Of course lawyers, as I said last week, can agree with their clients to charge as much as they like, and they can talk to their clients as long as they like. One would hope that the client is warned that the clock is turning all the time. I expect in this case the client knew that. One can spend a certain amount of time on the documents, and essentially, as I say, on this appeal all that had to be done was to photocopy the documents before the registrar. In fact there are only about 60 odd pages of actual evidence; all the rest is photocopies of exhibits in the other
volumes.
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If this had been the sort of case I have seen daily in the provinces, or even see here, the figures would seem
very
large even at £10,000, and that is why I think the figure of £10,000 for a one-day case in the High Court is pretty close to the appropriate amount, unless of course there are special things like disclosure or interviewing witnesses and so on which may have
increased
the cost. But with a case of immense importance it can still be done for £10,000.
I look at the figures and I just cannot imagine what people were doing; but whatever they were doing it was wholly disproportionate to what such a one-day case would involve. I say that with respect to the figures on both sides.
The court must control costs. No one can feel that they can run up an enormous bill on their side which, if they are successful, can be
visited
on the other side. That will be true even in cases where both sides are playing the same game.
I assess the costs here at £10,000."
incurred
by the Opponent as set out in its statement of costs.
very
wide.
view
that in the instant case the judge erred in principle when he in effect applied his own tariff to the case, without carrying out any detailed examination or analysis of the costs actually
incurred
by the Opponent as set out in its statement of costs.
incurred
by the party in question, as shown in its statement of costs; and that it should carry out the assessment by reference to the items appearing in that statement. In so doing, the court may find it helpful to draw to a greater or lesser extent on its own experience of summary assessments of costs in what it considers to be comparable cases. Equally, having dealt with the costs by reference to the detailed items in the statement of costs which is before it, the court may find it helpful to look at the total sum at which it has arrived in order to see whether that sum falls within the bounds of what it considers reasonable and proportionate. If the court considers the total sum to be unreasonable or disproportionate, it may wish to look again at the
various
detailed items in order to see what further reductions should be made. Such an approach is wholly unobjectionable. It is, however, to be contrasted with the approach adopted by the judge in the instant case.
vehicle
for the introduction of a scale of judicial tariffs for different categories of case. However general the approach which the court chooses to adopt when assessing costs summarily, and however broad the brush which the court chooses to use, the assessment must in my judgment be directed to and focused upon the detailed breakdown of costs contained in the receiving party's statement of costs.
LORD JUSTICE BUXTON:
venture
to add some words of my own.
Introduction
Flowers,
its "primary assets were its registered United States service marks DIAL 800-
FLOWERS
and 800-
FLOWERS,
which were awarded
incontestable
status, and the right to use the telephone number 1-800-356-9377, which corresponds to 1-800-
FLOWERS.
With these assets we believed we could build a nationwide floral telemarketing business
.800
Flowers
is the mnemonic for the toll free number by which customers can place orders with my Company but it is also my Company's corporate and trade name as well as an internationally recognised and well known Trade Mark". Mr Hobbs QC on behalf of the applicant expanded on this theme by pointing out that 800-
Flowers
is not "nationally linked": that is, in the context of national systems of freephone telephone numbers it equally forms a part of 1-800 numbers, as used in the USA and in some other countries, and of 0800 numbers, as used in the United Kingdom and other European countries.
Flowers
was selected in the context of, and is inextricably linked with, the operation of the applicant's freephone business in the USA. Were that not so, it would be difficult to think of a style and company name less apt to distinguish the business of an ordinary florist than a number apparently chosen at random followed by a word describing the industry's product. It is this association between the mark and the phone number that has overlaid the whole of this case.
Flowers"
when customers in the United Kingdom telephone the United States number 1-800-
FLOWERS,
or access a web-site that is similarly designated; whereas when arguing that the mark is capable of distinguishing the applicant's business, and will not cause confusion, when registered as a United Kingdom mark, the applicants are forced to stress that the mark is indeed 800
Flowers
and not 0800
Flowers,
and forced to deny that in the United Kingdom "800
Flowers"
would be, or would be thought to be, what Mr McCann says that it is in the USA, a mnemonic for the distinctive part of the company's freephone number. The judge drew attention to this dilemma at p 702 of the judgment:
"in support of their application the applicants have sought to allege actual use of the mark. But what they claim to have used in the UK is only the US equivalent of an 0800 number, namely 1-800-FLOWERS.
I think they are right in saying that use of 1-800-
FLOWERS
would be a use of 800
FLOWERS,
but it follows that use of 0800
FLOWERS
is also use of 800
FLOWERS"
Section 10 of the 1938 Act
Section 11 of the 1938 Act
v
Bali [1969] 1 WLR 1306 at p 1324D-F, per Lord Upjohn.
view
800
Flowers
in the way in which the applicants wish customers in the USA to
view
it: as a guide or way in to a local freephone number. In seeking to counter this conclusion Mr Hobbs was reduced to arguing that such confusion would not arise because as customers were educated in the relation of the mark to a telephone number they would be educated in the relation of the mark to the USA number, which is what they would ring. This again sheds some light on the nature of the applicant's actual and intended use of the mark in the United Kingdom; but also, more immediately, the argument misses the point, because what the judge envisaged, and was entitled to envisage, was that persons in the United Kingdom generally, seeing or hearing about 800
Flowers,
would think that it was a number within the United Kingdom telephone system that they could dial in order to access the applicant's services. The applicant's argument was that such a state of affairs would not arise; and not that, if it did arise, the case would nonetheless not fall within section 11. The judge's finding was to the contrary, and was plainly open to him.
view
of one complaint made by the applicant, it should perhaps be emphasised that the judge's conclusion did not depend on any general rule that the registrability of a mark that takes the form of, or which closely resembles, a telephone number must necessarily be dependent on the possession by the proprietor of that telephone number. One can, admittedly with some difficulty in the conditions of modern commerce, envisage cases where that division would not be a source of confusion. But where the business to which the mark is attached, the receiving and transmission of orders, is inherently a business conducted over the telephone, the holder of the mark is necessarily likely to cause confusion as a matter of fact if he does not possess the telephone number to which the mark makes reference.
Use in the United Kingdom
flowers
and floral products. At the date of registration, those services were performed in the applicant's USA switching centre, accessed by use of the 1-800 telephone number, and (it would seem to a lesser extent) through the applicant's web-site, equally administered in the USA. It has never been suggested that such a centre, using a United Kingdom telephone number, would be set up here; indeed, as we have seen in connexion with the argument on confusion, the mark is asserted at all times to read back to a USA, and not to a United Kingdom, telephone number.
flowers,
when delivered to the ultimate recipient, bear no indication that the order has been administered through the applicant. Nor would the actual delivery of the
flowers
appear to be comprehended within the description of the business as the receiving and transfer of orders. The fact that
flowers
have actually been delivered in the United Kingdom as the end-result of the applicant's dealing with orders does not therefore assist it. Rather, Mr Hobbs said that use of the mark in the United Kingdom occurred when customers located in the United Kingdom placed orders upon the USA phone number, or upon the applicant's web-site. Knowledge that it was possible to place such orders, in the absence of anything more than token advertising in the United Kingdom, would have arisen from "overspill" advertising contained in USA publications circulating in the United Kingdom; or from personal knowledge on the part of people who had lived in or
visited
the USA, or from recommendations to others by such people. When the telephone was answered in the USA, the speaker by stating the identity of the applicant, or even, it would seem, simply by stating the telephone number, projected the mark into the United Kingdom and used it there; when the applicant's web-site was accessed by a customer in the United Kingdom, the mark materialised upon that customer's computer screen, and was thereby used by the applicant in the United Kingdom.
flowers.
And although Mr Hobbs cautioned us against placing too much weight upon the extent, as opposed to the genuineness, of the asserted use of the mark, there is no doubt that extent of use has some relevance to whether that use qualifies as a use establishing the mark as a badge of origin. I accept that in CHIPIE Trade Mark Application [2000] IP & T 735, much relied on by Mr Hobbs, the Privy Council said, at p739h, that
"the length of user may be immaterial, that is particularly the case where the mark is already in use as a trade mark by a trader elsewhere in the world. Proprietorship of the mark can then be proved by a minimal user in the country where the mark is proposed to be registered"
but even that statement requires some assessment to be made of the nature and extent of the use. The evidence in this case does not permit of even that modest enquiry.
visual
representation of the mark, as section 68(2) of the 1938 Act requires. That
limitation
is removed in relation to current uses by section 103(2) of the 1994 Act, and in any event does not arise at all in relation to displays of the mark over the internet: on which latter it will be convenient to concentrate, the applicable principles being in my
view
the same in that case and in the case of telephone use under the 1994 Act.
"any use of a trade mark on any website, wherever the owner of the site was, was potentially a trade mark infringement anywhere in the world because website use is in an omnipresent cyberspace; that placing a mark on a web was 'putting a tentacle' into the computer user's premises "
very
interesting and detailed study conducted by the Section of Business Law of the American Bar Association and published in The Business Lawyer for May 2000. Without presuming to enter into detailed discussion of or commentary on that study, or the many cases, mainly in the USA, that it addresses, I do
venture
to suggest that the essence of the problem is to fit the factual circumstances of internet use into the substantive rules of law applying to the many and
very
different legal issues that the internet affects. It is therefore unlikely, and it is nowhere suggested, that there will be one uniform rule, specific to the internet, that can be applied in all cases of internet use. That consideration is of importance in our present case, because it was a significant part of the applicant's submissions that, for instance, "publication" of statements in a particular jurisdiction by downloading from the internet according to the rules of the law of defamation or of misrepresentation was of at least strong analogical relevance to whether a trade mark downloaded from the internet had been "used" in the jurisdiction to which it was downloaded; and, even more directly, that when A placed a mark on the internet that was downloaded by B, the same criteria should apply in determining whether A thereby used the mark as determine whether A thereby infringed the same mark in the jurisdiction where B was located.
very
idea of "use" within a certain area would seem to require some active step in that area on the part of the user that goes beyond providing facilities that enable others to bring the mark into the area. Of course, if persons in the United Kingdom seek the mark on the internet in response to direct encouragement or advertisement by the owner of the mark, the position may be different; but in such a case the advertisement or encouragement in itself is likely to suffice to establish the necessary use. Those considerations are in my
view
borne out by the observations in this court in Reuter
v Mulhens [1954] Ch 50. The envelopes on the outside of which the allegedly infringing mark was placed as advertising matter were sent by post into the United Kingdom by the defendants. It is trite law that the Post Office is the agent of the sender of a letter to carry it, and thus it was the defendants who were to be taken to have delivered the letter to the recipients and to have displayed the mark to them within this jurisdiction. No such simple analysis is available to establish use by the applicant within this jurisdiction if he confines himself to the internet.
The cross-appeal
LORD JUSTICE PETER GIBSON: