IL-2023-000007 - [2025] EWHC 2863 (Ch)

Section 10(3) TMA provides as follows:

“(3)

A person infringes a registered trade mark if he uses in the course of trade, in relation to goods or services, a sign which—

(a)

is identical with or similar to the trade mark,

(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

where the trade mark has a reputation in the United Kingdom and the use of the sign, being without due cause, takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the trade mark.”

Section 10(3A) provides that “[s]ubsection (3) applies irrespective of whether the goods and services in relation to which the sign is used are identical with, similar to or not similar to those for which the trade mark is registered”.

The aim of section 10(3) is to protect the reputation of a registered trade mark from damage in the form of unfair advantage or detriment to the distinctive character or repute of the mark. There is no requirement for confusion and no requirement for the infringing use to be in relation to identical or similar goods or services.

There are nine conditions that a claimant must satisfy in order to establish infringement under section 10(3): (i) the trade mark must have a reputation in the relevant territory; (ii) there must be use of a sign by a third party within the relevant territory; (iii) the use must be in the course of trade; (iv) it must be without the consent of the proprietor of the trade mark; (v) it must be of a sign which is at least similar to the trade mark; (vi) it must be in relation to goods or services; (vii) it must give rise to a “link” between the sign and the trade mark in the mind of the average consumer; (viii) it must give rise to one of three types of injury, that is to say, (a) detriment to the distinctive character of the trade mark, (b) detriment to the repute of the trade mark or (c) unfair advantage being taken of the distinctive character or repute of the trade mark; and (ix) it must be without due cause: See Muzmatch per Arnold LJ at [55].

In this case, condition (i) is admitted and conditions (ii) to (vi) are dealt with above. Condition (vii), link, is not contested. No point is taken on condition (ix). Accordingly, the only remaining issue is whether the use of the Sign gives rise to one of the three types of injury (condition (viii)), namely, detriment to distinctive character (dilution), detriment to reputation (tarnishment) and unfair advantage (free-riding), all of which are pleaded by Getty Images.

In opening submissions, there appeared to be a dispute between the parties as to (i) exactly what is required in order to establish one or more of the three types of injury (specifically whether a change in economic behaviour is required for each); and (ii) whether Getty Images’ pleaded case in relation to each of the different types of injury is sufficient.

Stability relies upon an observation made by Arnold LJ in Thatchers Cider Company Ltd v Aldi Stores Ltd [2025] EWCA Civ 5 (“Thatchers”) at [51] to the effect that:

“the case law of the Court of Justice establishes that infringement under section 10(3) requires evidence of a change in the economic behaviour of the average consumer of the goods or services for which the trade mark is registered”.

Stability says that this observation (made in the context of a case concerned with unfair advantage and detriment to reputation) applies to each of the types of injury under s.10(3) and that Getty Images have pleaded change in economic behaviour in relation only to an allegation of detriment to the distinctive character of the Marks. It submits that this single allegation of change in economic behaviour cannot succeed (for reasons to which I shall return). Further it says that Getty Images cannot succeed on either of the other two heads of injury asserted, not least because there is no plea of change in economic behaviour in relation to each of those heads.

By the time of closing submissions, I did not understand Getty Images seriously to suggest that Arnold LJ’s observation in Thatchers could properly be limited only to dilution. Instead, it made a rather different point, to the effect that Arnold LJ’s observation did not address the more nuanced approach to evidential requirements taken by the CJEU (to the effect that a deduction may be made based on “an analysis of the probabilities and by taking account of the normal practice in the relevant commercial sector as well as the other circumstances of the case”: Case C-383/12 Environmental Manufacturing LLP v Office for Harmonisation in the Internal Market (Trade Marks and Designs) [EU:C:2013:741]).

As for its pleaded case, Getty Images accept that their Particulars of Claim make a plea of change in economic behaviour only when dealing with dilution of the distinctiveness of the Marks. However they contend that there is no requirement for an express plea in relation to the allegations of free-riding and tarnishment because “[t]he serious risk of any detriment and the relevant change in the economic behaviour of consumers can be deduced from the facts and matters that are pleaded in those sub-paragraphs”.

I begin by taking the applicable legal principles on each type of injury in turn.

In Lidl at [22]-[24], Arnold LJ set out the following propositions in relation to detriment to distinctive character with reference to C-252/07 Intel Corp Inc v CPM UK Ltd EU:C:2008:655:

“The Court of Justice stated in Intel v CPM:

“29.

As regards, in particular, detriment to the distinctive character of the earlier mark, also referred to as ‘dilution’, ‘whittling away’ or ‘blurring’, such detriment is caused when that mark’s ability to identify the goods or services for which it is registered and used as coming from the proprietor of that mark is weakened, since use of the later mark leads to dispersion of the identity and hold upon the public mind of the earlier mark. That is notably the case when the earlier mark, which used to arouse immediate association with the goods and services for which it is registered, is no longer capable of doing so.

...

67.

The more immediately and strongly the earlier mark is brought to mind by the later mark, the greater the likelihood that the current or future use of the later mark is taking unfair advantage of, or is detrimental to, the distinctive character or the repute of the earlier mark.

68.

It follows that, like the existence of a link between the conflicting marks, the existence of one of the types of injury referred to in Article 4(4)(a) of the Directive, or a serious likelihood that such an injury will occur in the future, must be assessed globally, taking into account all factors relevant to the circumstances of the case, which include the criteria listed in paragraph 42 of this judgment.

69.

… the stronger the earlier mark’s distinctive character and reputation the easier it will be to accept that detriment has been caused to it …

…

77.

… proof that the use of the later mark is or would be detrimental to the distinctive character of the earlier mark requires evidence of a change in the economic behaviour of the average consumer of the goods or services for which the earlier mark was registered consequent on the use of the later mark, or a serious likelihood that such a change will occur in the future.

78.

It is immaterial, however, for the purposes of assessing whether the use of the later mark is or would be detrimental to the distinctive character of the earlier mark, whether or not the proprietor of the later mark draws real commercial benefit from the distinctive character of the earlier mark.”

23.

With respect to the requirement identified in Intel v CPM at [77], the Court of Justice added in Case C-383/12 Environmental Manufacturing LLP v Office for Harmonisation in the Internal Market (Trade Marks and Designs) [EU:C:2013:741]:

“42.

Admittedly, Regulation No 207/2009 and the Court’s case-law do not require evidence to be adduced of actual detriment, but also admit the serious risk of such detriment, allowing the use of logical deductions.

43.

None the less, such deductions must not be the result of mere suppositions but … must be founded on ‘an analysis of the probabilities and by taking account of the normal practice in the relevant commercial sector as well as all the other circumstances of the case’.”

24.

It is not in dispute that the approach articulated in [43] is also applicable to the question of whether there has already been a change to the economic behaviour of the average consumer.

It is plain from this passage that, when Arnold LJ was referring to the need for evidence in Thatchers, he was using a shorthand. The existence of a change in the economic behaviour of the average consumer, or a serious likelihood of such a change, may be deduced having regard to the factors identified. I did not understand Stability to disagree with this proposition.

In Thatchers at [50] the Court of Appeal cited with approval the definition given by the Court of Justice in C-487/07 L’Oréal SA v Bellure NV EU:C:2009:378 (“L’Oréal v Bellure”) at [40]:

“As regards detriment to the repute of the mark, also referred to as ‘tarnishment’ or ‘degradation’, such detriment is caused when the goods or services for which the identical or similar sign is used by the third party may be perceived by the public in such a way that the trade mark’s power of attraction is reduced. The likelihood of such detriment may arise in particular from the fact that the goods or services offered by the third party possess a characteristic or a quality which is liable to have a negative impact on the image of the mark.”

In Lidl at [25], the Court of Appeal cited the following paragraphs from L’Oréal v Bellure:

“41.

As regards the concept of ‘taking unfair advantage of the distinctive character or the repute of the trade mark’, also referred to as ‘parasitism’ or ‘free-riding’, that concept relates not to the detriment caused to the mark but to the advantage taken by the third party as a result of the use of the identical or similar sign. It covers, in particular, cases where, by reason of a transfer of the image of the mark or of the characteristics which it projects to the goods identified by the identical or similar sign, there is clear exploitation on the coat-tails of the mark with a reputation.

…

43.

It follows that an advantage taken by a third party of the distinctive character or the repute of the mark may be unfair, even if the use of the identical or similar sign is not detrimental either to the distinctive character or to the repute of the mark or, more generally, to its proprietor.

44.

In order to determine whether the use of a sign takes unfair advantage of the distinctive character or the repute of the mark, it is necessary to undertake a global assessment, taking into account all factors relevant to the circumstances of the case, which include the strength of the mark’s reputation and the degree of distinctive character of the mark, the degree of similarity between the marks at issue and the nature and degree of proximity of the goods or services concerned. … the more immediately and strongly the mark is brought to mind by the sign, the greater the likelihood that the current or future use of the sign is taking, or will take, unfair advantage of the distinctive character or the repute of the mark …”.

The global assessment may also take into account, where necessary, the fact that there is a likelihood of dilution or tarnishment of the mark (L’Oréal v Bellure at [48]).

In Thatchers, Arnold LJ (having also cited the above passages from L’Oréal v Bellure), said this at [48]:

“It is clear both from the wording of the relevant provisions and from the case law of the Court of Justice and General Court interpreting them, in particular L’Oréal v Bellure, that this aspect of the legislation is directed at a particular form of unfair competition. It is also clear from the case law both of the Court of Justice and General Court and of the domestic courts and tribunals that the defendant’s conduct is most likely to be regarded as unfair where the defendant intends to take advantage of the reputation of the trade mark. Nevertheless, in Jack Wills Ltd v House of Fraser (Stores) Ltd [2014] EWHC 110 (Ch), [2014] FSR 39 I concluded at [80] that there was nothing in the case law to preclude the court from holding in an appropriate case that the use of a sign the objective effect of which is to enable the defendant to benefit from the reputation of the trade mark amounts to unfair advantage even if it is not proved that the defendant subjectively intended to exploit that reputation.

Paragraph [162] of Lidl confirms (in so far as any dispute remains) that a finding of change in economic behaviour, or risk of such change, is required not only for detriment to distinctive character, but also for ‘unfair advantage’.

Getty Images’ case on injury is set forth in paragraphs 57.7 to 57.11 of their Particulars of Claim, as follows:

“57.7

Such use will result in the Defendant taking advantage of the Claimants’ investment in developing the reputation of the Trade Marks and each of them. It is to be inferred that such was the Defendant’s intent, alternatively, such is the objective effect of the Defendant’s use.

57.8

Further or alternatively, such use will result in the dilution of the distinctiveness of the Trade Marks and each of them. In particular, and pending disclosure and evidence herein, the average consumer of the goods and services for which the Trade Marks are registered are likely to use Stable Diffusion to generate an image which is the same as or similar to the Claimants’ Content but in respect of which it will not have to pay a licence fee. Accordingly there is a serious likelihood that the use complained of will result in a change in the economic behaviour of the average consumer of the goods and services for which the Trade Marks are registered.

57.9

Further or alternatively, Stable Diffusion can be used to create images that contain pornography, violent imagery, and propaganda. Any association with such content will tarnish the reputation of the Trade Marks and each of them. Examples of such images which have been created using Stable Diffusion are at pages 20 and 100 of Annex 8H and Confidential Exhibit DAS-15 to the Witness Statement of David Stanley.

57.10

Further still, the synthetic images generated by Stable Diffusion distort and/or manipulate the underlying image from which it was copied, which is prejudicial to the reputation of the author of the original work, and tarnishes the reputation of the Trade Marks and each of them.

57.11

Yet further still, the Trade Marks and each of them (in particular when they are included as watermarks as set out above at paragraph 29.4) guarantee to members of the public that the works to which they are affixed are genuine photographs or pieces of footage. This guarantee will be eroded by the Defendant’s use complained of herein, in particular, by affixing the sign GETTY IMAGES or ISTOCK to the synthetic output as a watermark members of the public will no longer be able to rely upon the Trade Marks as guaranteeing the authenticity of the works to which they are affixed, thus tarnishing their reputation”.

My understanding of this pleading is that unfair advantage is pleaded at paragraph 57.7, dilution of distinctiveness is pleaded at paragraph 57.8 (in which the plea of change of economic behaviour is expressly made) and tarnishment is pleaded at paragraphs 57.9-57.11. It is unclear how the allegation of tarnishment involving the appearance of watermarks* on pornography, violent imagery or propaganda could possibly apply to the ISTOCK Mark – there is no evidence of an iStock watermark* appearing on any images of this type and, accordingly, I dismiss any such claim.

I agree with Stability that, as is now common ground, the only express plea of change of economic behaviour is set out in paragraph 57.8 of the Particulars of Claim and is concerned with the allegation of detriment to distinctive character/dilution. This is not in fact a plea that there has already been a change in economic behaviour, but rather a plea that there is a serious likelihood of such a change.

In closing, Getty Images focused most of its fire power on the allegation of detriment to reputation, arguing that a change in economic behaviour can clearly be deduced from the appearance of the Signs on pornography, violent imagery and propaganda, as well as distorted or manipulated images and synthetic (or fake) images. It submitted that affixing a claimant’s mark to a pornographic image is the archetypal case of tarnishment and that, similarly, attributing distorted or manipulated images to Getty Images is damaging to the reputation it has for licensing high quality, genuine images reporting on editorial content.

Getty Images did not refer (either in opening or closing) to its pleaded case on change of economic behaviour with, I consider, good reason. The case as pleaded is unsustainable. It presupposes that the average consumer will wish to use the Model in order to try to circumvent the need to pay for Getty Content. However, the pleading does not say how this will be done. One might postulate in light of the evidence in this case that it could be done by using Getty Images’ captions (as Ms Varty did), but I have already held that there is no evidence of this occurring by users of Stable Diffusion in the real world.

In any event, even assuming that a real life consumer were to take this step, this is a trade mark claim and so the resulting image would have to bear a watermark*. In other words, as Stability correctly points out, on this hypothesis, after all his effort, the crafty consumer seeking to avoid a license fee, ends up with what he was seeking to avoid: another watermarked* image – the generated image (given the images in Annex 8H) being almost certainly an imperfect and distorted facsimile of the original image. Aside from the fact that it is impossible to see why the average consumer would change his economic behaviour in order to generate a second unusable image with a watermark*, this case is predicated upon the consumer trying to reproduce an image in circumstances where he cannot possibly think anything other than that the appearance of the watermark* is a consequence of his deliberate attempts to reproduce the Getty Images Content. Such a consumer will certainly not regard the appearance of the watermark* as an indicator of origin by Stability.

As Stability points out there is no evidence whatever in the case to support the pattern of behaviour pleaded by Getty Images and no basis on which I could properly deduce this change in economic behaviour. The Getty Images’ pleading at 57.8 is, in my judgment, no more than pure supposition. On proper analysis it has no foundation in reality and I reject it.

Strictly, as it seems to me, Stability is right to say that beyond what is pleaded in paragraph 57.8 of the Particulars of Claim, there is no other pleaded case on change in economic behaviour. Ms Lane sought to address this by pointing out that the court is entitled to make a deduction as to the likelihood of a change in economic behaviour. This is correct for the purposes of determining the issue and, although the pleading could and should have addressed the point, I am most reluctant to determine the case under section 10(3) TMA purely on a pleading point. Stability did not expressly deny the allegations of unfair advantage and tarnishment in its Defence on the grounds that there was no express plea of change in economic behaviour, choosing instead to focus on its arguments as to use in the course of trade. Furthermore, Stability has had the opportunity to cross examine Getty Images’ witnesses on this issue, including (in particular) Mr Stanley, just as it has had the opportunity to make detailed submissions on each of the heads of injury alleged. The assessment for the court is a global assessment. In the circumstances, I can see no real prejudice to Stability in the court considering whether it would be appropriate to infer or deduce a change in economic behaviour (in so far as such change has now been articulated by Getty Images) in respect of any of the allegations of injury under section 10(3) TMA.

I turn to look in more detail at Getty Images’ case on each of the three alleged heads of injury.

I have already dealt with Getty Images pleaded case on dilution, which does allege a change in economic behaviour, albeit not of a type that is in any sense realistic. As I understood Getty Images’ case on dilution in closing, however, it was focused on the argument that (i) the Marks are inherently distinctive such that they will be brought to mind inherently and strongly when the average consumer encounters the Sign; and (ii) the use of the Signs will “inevitably weaken the Mark’s ability to identify the goods and services for which they are registered as coming from Getty Images, as there has been, and will continue to be, a proliferation of synthetic image output images bearing the marks” (emphasis added).

However, this case appears to me to be both unusual and problematic. It is now three years since the Model was first made available and although Getty Images has been able to produce evidence to satisfy me that at least one user in the UK will have encountered a watermark*, it has been able to do so only in respect of v1.x and v2.x of the Model, and even then only by reference to an extremely small number of examples. I have found similarity between Mark and Sign in relation to three examples only. While I accept that various of the other watermarks* on real life images in Annex 8I (and on images in Annex 8H where the prompts have included the words “news photo” or “vector art”) would likely give rise to a finding of similarity and potentially also to a “link”, I have no means of assessing the scale of the production of watermarks* falling within that category in real life. The case is thus historic and my findings at this trial are, of necessity, extremely limited. Getty Images have not sought to run any case based on probability as to the number of watermarks* that may have been produced in the real world by users in the UK of v1.x and v2.x or (more importantly) the number of actually infringing watermarks* that may have been produced (bearing in mind all that I have said already about the fact sensitive nature of the enquiry).

Nevertheless, given that I have found that at least one infringing watermark* has been produced by versions 1.x and 2.x, and given that Stability has no case of de minimis, should the court infer that there has been detriment?

On the available evidence, there is certainly no basis whatever on which to find (or deduce) that there will “continue to be a proliferation of synthetic output images bearing the Marks”. I have dismissed Getty Images’ case in relation to the later versions of the Models. The unchallenged evidence of Mr Bandari was that since he joined Stability in August 2023, new models have been produced in the form of SD3.0, SD3.5, Stable Video, Stable 3D, language and audio models. There are no allegations in relation to any of these Models.

The highest Getty Images were able to put their case on this in closing was to say that the documentary evidence shows that “SDXL was producing watermarks during the development process”. This is of course correct but (i) there is no evidence before the Court of any iStock watermarked* image (on any version of the Model) being produced in real life since January 2023 (the Dreaming Image); and (ii) no evidence before the Court of any Getty Images watermarked* image being produced in real life since shortly prior to the public release of SD XL (March 2023). There are no Reddit Exchanges dating from later than 2023 and the SalesForce Materials on which Getty Images rely date from 2022. The fact that there is evidence that v2.x remains available for download takes matters no further.

In all the circumstances, there is certainly no evidence on which I can deduce that there will be a continuing use of the Signs which will dilute the distinctiveness of the Marks.

As to historic use, I must bear in mind that the Getty Images Marks have a strong reputation and distinctive character and that (at least where the watermark* is clearly rendered on a synthetic image) its appearance on a synthetic image will immediately and strongly bring to mind the earlier Mark. In such a case there is a greater likelihood that the use of the Sign is detrimental to the distinctive character of the Mark.

Ordinarily, in a more conventional case, these points might go a long way towards a finding of dilution. However, I do not consider such a finding to be appropriate in the novel circumstances of this case.

Although Stability pleads no case of de minimis and accepts “non-trivial” generation of watermarks* by v1.x, the burden of establishing dilution rests with Getty Images and I cannot see that they have satisfied that burden in the very particular circumstances of this case. Their pleaded case on change in economic behaviour is unsustainable and their alternative case, articulated only at trial, requires a finding or deduction that there has been a “proliferation of synthetic images” which satisfy all the conditions referred to above for infringement under section 10(3) and which have led to an adverse effect on the origin function of the Marks.

I cannot make such a finding or deduction on the available evidence given the fact-sensitive nature of the enquiry in relation to every generated watermark* and the lack of any probabilistic analysis as to the number of watermarks* that are likely to have been generated in real life by users in the UK. The mere presence of a similar sign on the market is insufficient to establish detriment to the uniqueness and so the distinctive character of the mark. I have no means of determining the scale of the generation of infringing watermarks* by v1.x or v2.1 and not a scrap of evidence of any change in economic behaviour by the users of those Models. Accordingly, having regard to all the circumstances of the case, I consider that there is no evidence on which I could properly deduce that the distinctive character of the Marks has been diminished. Getty Images’ submissions amount to no more than an invitation to engage in supposition, which I decline to do.

Getty Images’ case of detriment to distinctive character/dilution under section 10(3) TMA fails for all the reasons set out above.

The Experts were in agreement that:

As Professor Farid explained, it is possible to filter for such content, both at the training stage (by excluding NSFW images and captions from the training datasets) and at the inference stage. As I have already discussed earlier in this judgment, similar filtering can also be done for watermarked* images.

The Experts agree that they are not aware of any public materials which address any specific filtering to remove violent, NSFW images from the datasets used to train and develop v1.x. However, Professor Farid explains in his report that by the time of the release of v1.4, a Safety Checker had been put in place to check model outputs and a prompt filtering step had been applied at the inference stage. Professor Farid explains, and I find, that prompt filtering can be performed reasonably reliably through an API “but is nearly impossible to enforce in open source software because a user can simply remove these safeguards”. I did not understand Professor Brox to disagree.

It is clear that (at least by the time of the release of v2.0), Stability had taken steps to filter NSFW content out of the training dataset. The Model Card for v2.0 says:

“The model was trained on a subset of the large-scale dataset LAION-5B, which contains adult, violent and sexual content. To partially mitigate this, we have filtered the dataset using LAION’s NSFW detector”.

The Hugging Face page for v2.0 makes reference to this filter, recording that:

“The training data is further filtered using LAION's NSFW detector, with a "p_unsafe" score of 0.1 (conservative)”.

LAION’s website reports the accuracy of the filter (or classifier, as Professor Farid describes it) to be 96%, subsequently labelling 2.9% of the dataset as ‘unsafe’. Professor Farid explains that he does not know whether this figure accurately corresponds to the true number of unsafe images in this dataset.

Professor Brox confirmed in cross examination, that he would understand this evidence to mean that Stability had not managed fully to mitigate the effect of the inclusion of NSFW in the training dataset, such that there would remain potential for the Model to generate such content. The Experts agree that they are not aware of any public materials which address any express filtering of v2.x of the Model to remove violent images.

It was clear from the evidence of both Mr Auerhahn and Mr Bandari that they were aware that there was a problem with the generation of NSFW images by the Model. The following exchange took place during the cross examination of Mr Auerhahn:

“Q. Mr. Auerhahn, it is right, is it not, that the model can produce pornographic images?

A. Yes. It depends on which model we are talking about and what your definition of "pornography" is, but I think one could say that.

Q. Yes. The models we are talking about, just to be clear, are Stable Diffusion v1, v2 and XL.

A. Right. By the time it got to v2 and XL it was definitely not as good at doing that and would not do it as often, and many times took most of that stuff out, but it is still possible.

Q. It did do it occasionally?

A.

Yes”.

Mr Bandari confirmed in cross examination that he had been involved in a Slack Chat exchange in April 2024 following contact from a professor who had informed Stability that “it was very easy to get around [its] safety filter and get really violative results”. The means by which this can be achieved is later explained in the Slack Chat by Javad Azimi who says this:

[Redacted]

Javad Azimi observes that the “image classifier…needs some improvement”.

In the same Chat, Mr Konstantinov refers to this as a problem with DreamStudio XL generating NSFW images: “Generating NSFW with DreamStudio (SDXL) doesn’t seem to be a big deal, even if you don’t use fancy pipelines”. He identifies a different means of achieving NSFW images which appears to involve using the image to image function on the model: [Redacted]

In the same Chat, Ella Irwin says that she is worried that “Daria and Misha were easily able to producing (sic) NSFW content using [Dream]Studio in like two seconds. Why is that? It’s my understanding that we have had problems with NSFW content and pretty serious NSFW content with DreamStudio in the past. Did the filters stop working?”. Mr Konstantinov says that Stability would need “to develop and apply filters both for DreamStudio and for our future assistant”. Mr Bandari agreed in cross examination that this situation might well be worse where users had downloaded the Model because Stability could not filter the prompts used locally. I note that in the same Chat, Todd Elvers points out that “Safety filters for API calls from DreamStudio should be same as SD XL 1.0 and SD1.6” and he provides a link. Later in the Chat Mr Bandari says that “the issue is not isolated to DreamStudio”, by which he appears to mean it applies to all APIs. He goes on to observe that “we will have to find ways that we can reproduce easily and see if we can mitigate it”. The Chat continues to discuss how the problem can be addressed. Mr Bandari was not questioned about the detail of the means by which the filters could be by-passed or the possibility that this would be done by real world users. Mr Konstantinov was also not asked about this.

Ms Hodesdon accepted in cross examination that the Model can produce outputs that are NSFW but explained that Stability was able to exercise control over outputs “to ensure that we are not serving that content back to end users”. She confirmed that “pretty robust” filters were used for this purpose on Stability’s server, that these filters had improved over time, that “at the moment they are subject to lots of testing”, and that Stability can “control the sensitivity of the filters”. She confirmed that this evidence did not apply to source code and model weights downloaded from GitHub and Hugging Face – evidence consistent with Professor Farid’s views.

Getty Images say that given that the generation of NSFW images was plainly a problem, and given that there is evidence that the generation of watermarked* images was also a problem, “the combination of the two is also likely”. Thus it contends that any association with such content will tarnish the reputation of the Marks. Getty Images rely on the fact that, during the Getty Watermark Experiments, images of Miley Cyrus were generated which they say are pornographic and which bear Getty Images watermarks*. These are referred to in paragraph 57.9 of the Particulars of Claim as appearing at pages 20 and 100 of Annex 8H and in a confidential exhibit to Mr Stanley’s statement:

It is Getty Images’ case that the content of these images, specifically the depiction of nudity and the particular “poses and actions of the persons depicted” renders them NSFW. Mr Stanley confirmed in his evidence that he believed that these images “could be considered pornographic”. The Court of Appeal ([2025] EWCA Civ 749) characterised them as “artificial images of celebrities in states of undress” and took the view (at [28]) that “[t]hey therefore fall within the broad remit of pornography”.

Stability says that, on the balance of probabilities, it is “vanishingly unlikely” that any pornographic images with watermarks* will have occurred in the UK. It points out that none of the images relied upon by Getty Images was generated through DreamStudio or via the Developer Platform (in respect of which filtering is possible and is done) and that there is no evidence whatever of such NSFW images with watermarks* being produced in real life, notwithstanding Getty Images’ investigations of social media and its millions of interactions with Getty Images customers since this litigation began.

Stability points out that at least 1,000 images of Miley Cyrus were generated during the litigation of which only 19 include watermarks*. It also points out that the scenarios identified in the Slack Chat all involve deliberate misuse of the Model and are no more than “internal stress testing for preventative measures” which say “nothing about user interactions”. It relies again on what Getty Images said to the Court of Appeal to the effect that it is users who choose to generate pornography, violent images and propaganda – their actions have nothing whatever to do with Stability.

On balance, I agree with Stability that this is not a case in which I can properly find damage to reputation in relation to:

Although I have found that evidence of images bearing watermarks* may be difficult to come by owing to the fact that many consumers who do not want those images will simply discard them, it seems to me that the position is rather different when one is talking about potentially shocking or disturbing pornographic images bearing Getty Images or iStock watermarks*. If this had been happening in real life in response to prompts that were not designed to generate a pornographic image (including, for example the words “news photo”) I would have expected to see evidence in social media or in Getty Images’ SalesForce Materials of that. I would also have expected to see evidence in Stability’s internal Chats addressing the potential for pornography to appear together with watermarks*. However, there is no mention of anyone coming across a pornographic image bearing a watermark* in the cases referred to above (or indeed in any real life instance), notwithstanding that extensive “stress-testing” on the production of pornographic images appears to have been taking place.

Nonetheless, it is true that a real world user could have used the prompt “news photo” in relation to v2.1 of the Model in conjunction with other text (perhaps using the name of a female popstar), and (having done so) could have generated a NSFW image with a Getty Images watermark*. The Getty Watermark Experiments confirm that this can happen in relation to v1.x and v2.1 of the Model (at least insofar as the download mechanism is concerned).

Against that background, the question for the court is whether, absent any evidence of “real life” generation of pornographic images bearing watermarks*, the Miley Cyrus images (generated by Getty Images during their experiments and with their consent), together with the Expert evidence to which I have referred, are sufficient to enable me to deduce damage to reputation.

In my judgment they are not, for the following reasons:

In its pleading at paragraph 57.10, Getty Images also seek to rely upon the damage to reputation that would be caused by distorted or manipulated images. Curiously, however, 57.10 appears to be parasitic on Getty Images’ case on primary infringement of copyright, which they have abandoned. The express premise is that the watermark* is accompanying a copied underlying image and that it is prejudicial to the reputation of the author of that image as well as tarnishing the reputation of the Marks.

In closing, Getty Images sought to address this allegation together with the subsequent allegation at paragraph 57.11 in relation to “non-genuine photographs”. It did not explain how I was to address the allegation that watermarks* appeared on “copied” images or how this plea could sensibly survive the abandonment of the Outputs Claim. Aside from the SOCI images (produced with the consent of Getty Images) there is no evidence that synthetic images have been generated by the Models which distort an underlying image from which it has been copied.

At 57.11, Getty Images focuses on “non-genuine photographs”. Ms Cameron explained Getty Images’ concern about “deepfakes” – i.e. images where the content has been digitally altered and used to spread false and misleading information: “We want customers to know that any editorial content that they source from Getty Images is what we say it is. It is not manipulated. It has not been altered. It is authentic.” Ms Gagliano gave similar evidence.

As I understood this evidence it was directed at the editorial side of Getty Images’ business – i.e. photographs. It cannot relate to the ISTOCK Marks and Getty Images’ pleading is expressly limited to “genuine photographs or pieces of footage”.

There is no evidence whatever of deepfakes being created by the Models and used in the real world to spread misinformation – this is no more than supposition.

Finally, Getty Images emphasise Mr Stanley’s evidence as to the damage to Getty Images’ reputation that may be caused by the poor quality of the images synthesised by Stable Diffusion. This arises in the context of Getty Images’ claim that Getty Images watermarks have a reputation as guarantees of “genuine photographs or pieces of footage”.

Annex 8H shows that synthetic images may be generated (bearing watermarks*) in conjunction with the use of the words “news photo” and comparatively simple prompts which appear at best of low quality and at worst significantly distorted. I accept Mr Stanley’s evidence that the generation of low quality “non-genuine” photographs is a concern for Getty Images “because we pride ourselves on the quality of our photography and our product. If people were to think that these images came from, or were authorised by or associated with Getty Images, the fact that they are of such low quality would damage our reputation for producing high quality content”. Ms Cameron’s evidence was to similar effect. Two examples appear below, generated using v1.2 with the text captions “news photo of MTV VMAs” and “Obama, news photo”:

The watermarks* in these images are plainly “off” (appearing twice on each image and being extremely distorted) as are the images on which they have been affixed. However I am prepared to accept that depending on the appearance of the watermarks* and the image, there may be scope for the Model (versions 1.x and 2.x) to produce distorted images which appear photo-realistic and which are not so “off” that the average consumer would appreciate there could be no link with Getty Images. If that had happened in relation to outputs generated by relevant versions of the Model in real life then there might have been scope for a tarnishment claim.

The trouble is, however, that because each watermark* and each image will be different, and because I cannot say how often this will have happened in real life, I do not consider that I am in a position to find tarnishment on this basis in the circumstances of this case. Until after the circulation of the draft judgment, I was not asked to make any specific findings about the images that Getty Images produced using the “news photo” prompt or the watermarks* appearing on them, and accordingly I have declined to do so for reasons set out above. Furthermore, there is no evidence on which I could make any findings as to the frequency with which users will input prompts which include the words “news photo” or the probabilities of such prompts generating images that bear watermarks* which are sufficiently clear that a link will be made with Getty Images. This is (again) a function of the particular difficulties that arise in a case where no two manifestations of the Sign, or the image on which it appears, are the same. Once again, there is also no evidence whatever of a change in economic behaviour and no basis for deducing any such change.

Getty Images’ case of detriment to reputation/tarnishment fails for all the reasons set out above.

Getty Images’ pleading of unfair advantage is wholly unparticularised. It presupposes that Stability was intending to take advantage of the Claimants’ reputation in using the Sign, alternatively that that was the objective effect of its use. I bear in mind the importance of undertaking a global assessment on this question but on the facts of this case, this claim is unsustainable. It is true that the Models were trained on datasets which included Getty Images Content with watermarks. But it is clear from the evidence that the presence of watermarks* on synthetic images is undesirable and makes them unsuitable for use. Users of Models which produce images with watermarks* are, as I have held, likely to discard such images.

There is no basis on which I can infer that Stability intended watermarks* to appear or that it wished to take advantage of Getty Images’ reputation by reason of that appearance, and none was suggested. Indeed the evidence shows that from v2.x, Stability sought to take steps to try to filter out watermarks*: Getty Images’ pleaded case is that v2.x was trained on LAION-A which was created by the DeepFloyd team based on the filtering of LAION 5-B. Mr Konstantinov confirms that this involved a watermark filter and I agree with Stability that the fact that Getty Images was unable to generate any iStock watermarks* using v2.x during its experiments suggests that this was at least partially successful.

I can see no basis whatever on which it can sensibly be argued that Stability intended to gain any unfair advantage from watermarks* appearing on synthetic images generated by the Models and nor do I consider that to be the objective effect of the appearance of Signs on synthetic images. Notwithstanding the extensive reputation of the Marks and their distinctive character, it is very difficult to see how that reputation and character will be transferred to Stability by reason of their use of the Signs in circumstances where the average consumer will not wish to use the images generated.

For all the reasons set out above, Getty Images’ claim under section 10(3) TMA fails.