AMS NEVE AND ORS V HERITAGE AUDIO AND ANOR [2016] EWHC 2563 (IPEC)

In AMS Neve & Others v Heritage Audio & Another the Intellectual Property Enterprise Court has ruled that the English courts have jurisdiction to hear claims for UK trade mark infringement and passing off against Spanish defendants selling goods under similar marks online. However, because the decisions about the content of the Defendants’ website were made in Spain, it was held that there was no jurisdiction to hear the claim for infringement of an EU Trade Mark under Article 97(5) of EU Regulation No. 207/2009 (the ‘EU Trade Mark Regulation’).
In the proceedings, the Claimants were seeking to rely on their EU registered trade mark for the number ‘1073’ and 2 UK registered logo marks which were variations on a stylised sine wave to prevent the Defendants’ activities, namely the use of signs allegedly identical and/or similar to the Claimants’ registered trade marks to sell similar amp products online as follows:

heritage audio

It was alleged that the Defendants’ website was targeted at, amongst others, UK customers.
Pursuant to CPR 11, Heritage Audio S.L. (Madrid) and its Spanish director made a preliminary application for a declaration that the English courts did not have jurisdiction to try the Claimants’ claims for EU Trade Mark infringement, UK Trade Mark Infringement and Passing Off.

UK Trade Mark Infringement

In assessing whether the court had jurisdiction to hear the UK trade mark infringement claim, His Honor Judge Hacon (‘HHJ Hacon’) held that the Claimants were entitled to rely on the exception contained within Article 7(2) of EU Regulation No. 1215/2012 (the ‘Recast Brussels I Regulation’) which provides that, in matters relating to tort, in proceedings may be brought in the courts for the “place where the harmful event occurred or may occur”. HHJ Hacon noted that it was well-established that this includes (a) the place where the damage occurred (which includes the Member State in which the relevant IP right subsists); and (b) the place of the event giving rise to the damage (which is not limited to the place in which the entity advertising goods online is established).
On the evidence, the judge acknowledged that the Claimants had a good arguable case to put forward at trial. Relevant factors included the fact that Heritage Audio had English terms and conditions on their website and purchases appeared to have actually been shipped to the UK. He therefore held that the English courts had jurisdiction to hear the UK trade mark infringement claim because the Defendants’ website appeared to actively target English customers.

Passing Off

HHJ Hacon had no problems in concluding that the Recast Brussels I Regulation would also apply to the English tort of passing off and it would be for the English courts to determine liability (given that England is the place where the right subsists and the place where the damage potentially occurred).
HHJ Hacon also concluded that the question of whether the second defendant was jointly liable for the UK trade mark infringement and passing off claims was also to be determined by reference to English law.

EU Trade Mark Infringement
However, HHJ Hacon held that Article 7(2) of the Recast Brussels I Regulation does not apply to EU trade marks. Instead, jurisdiction is governed by Article 97 of the Trade Mark Directive. As an exception to the general domiciled rule, Article 97(5) provides that a Defendant maybe sued in “the Member State in which the act of infringement has been committed or threatened”.
In considering whether the UK courts had jurisdiction to hear the EUTM infringement claim, the Judge again considered the CJEU’s decision in Coty and emphasised the distinction to be drawn between (a) taking a decision to put a sign on a website and (b) displaying the sign on a website. It was held that only the courts of the place where (a) occurred would have jurisdiction, which in this case was Spain. Therefore, because the decisions about the content of the Defendants’ website were made in Spain, it was held that there was no jurisdiction to hear the claim for infringement of an EU Trade Mark under the EU Trade Mark Regulation.

Comment

As a result of this case, the Claimants are able to continue their claims for infringement of their UK registered logo marks and passing off in the English courts; however, the claim for infringement of their EU word mark must now be pursued in Spain. No doubt aggrieved by this inefficient outcome, the Claimants appear to have applied to the Court of Appeal for permission to appeal.

Link to Judgment

Judgment Date: 18 OCTOBER 2016

 

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