Case No. EWHC-2564-(IPEC)

Use of the Marks 53.The Claimants’ complaints related to uses of the Marks on the internet (in advertisements and on iKoustic’s website) and uses directly to consumers. The Google advertisements 54.The Defendants accepted that they had purchased Google adwords including the Marks and that this constituted use of the Marks, in the light in particular of Joined Cases C-236/08, C-237/08 and C-238/08, Google France, EU:C:2010:159, [2010] R.P.C. 19 at [51]-[52] and Case C-323/09, Interflora EU:C:2011:604, at [30]-[31]. However, little time was given to the use of the adwords at trial as the Claimants accepted that the text of the adverts was “Google France compliant.” Instead, the parties concentrated upon the Google dynamic ads also used by iKoustic.55.The Defendants admitted that iKoustic had paid for the Google dynamic ads service but said that the references to Google searches in the Amended Particulars of Claim arose from Google’s own generation of the wording of the ads rather than from bidding on specific search terms. The Defendants described this as a fundamentally different process to the generation of a sponsored ad as a result of use of a keyword. Instead of selecting a Mark as a keyword, dynamic ads are generated through Google’s analysis of the content of the iKoustic website and other parameters, including the browsing history of the person searching which, according to Mr Parsons, could affect the wording of the ad Google generates. The Defendants did not accept that use of this service constituted use by them of the Marks, on the basis that the ads were generated by Google’s algorithms, rather than by a positive choice of a Mark as a keyword by the Defendants. 56.At trial, the Claimants produced a document from Google showing that iKoustic could have selected the pages of the website which were to be available for matching (indeed, the Claimants submitted that they had to do that), or could have negatively matched key words, and so could have controlled – positively or negatively - which products were advertised. In particular, iKoustic could have excluded an individual webpage from being advertised if the product had become unavailable. Mr Parsons was shown the Google document and accepted that he had been aware that there were ways to exclude webpages, although he did not know what they were at the time.57.The Claimants referred me to Mitsubishi (supra) at [38]-[39] on the meaning of use of a mark in relation to goods. They submitted that what is required is “active behaviour in the context of a commercial activity” and said that was what the Defendants had done here, in relation to use of the dynamic ads service. Case C-684/19 mk advokaten GbR v MBK Rechtsanwalte GbR, EU:C:2020:519, [2020] ETMR 49 was decided shortly after the trial, and I am grateful to counsel for the additional submissions they sent to me in writing after I drew it to their attention on this point. Proceedings were brought against mk advokaten for alleged breach of an order not to use the mark MBK, after a Google search using the mark led to the display of advertisements for the firm on third party referencing websites. mk advokaten had withdrawn its own uses of the mark online. The CJEU held:“21 …, where a person operating in the course of trade orders, from the operator of a referencing website, the publication of an advertisement the display of which contains or is triggered by a sign which is identical with or similar to another person's trade mark, that person must be considered to be using that sign, within the meaning of Article 5(1) of Directive 2008/95 (see, to that effect, judgment of 3 March 2016, Daimler, C-179/15, EU:C:2016:134, paragraphs 29 and 30). 22By contrast, that person cannot be held liable, under Article 5(1) of Directive 2008/95, for the independent actions of other economic operators, such as those of referencing website operators with whom that person has no direct or indirect dealings and who do not act by order and on behalf of that person, but on their own initiative and in their own name (see, by analogy, judgment of 3 March 2016, Daimler, C-179/15, EU:C:2016:134, paragraphs 36 and 37). 23The term 'using' in Article 5(1) of Directive 2009/95 involves active conduct and direct or indirect control of the act constituting the use. … 27 In that regard, it must be noted that, in a situation where the website operators reproduce an advertisement on their own initiative and in their own name, the economic operator whose goods or services are thus promoted cannot be regarded as their customer. 30 Finally, as regards the fact, referred to in the order for reference, that, in the case which gave rise to the judgment of 3 March 2016, Daimler (C-179/15) EU:C:2016:134, the advertisement which infringed another person’s trade mark was initially lawful, whereas the advertisement at issue in the dispute in the main proceedings infringed another person’s trade mark from the outset, it is sufficient to note that that circumstance is irrelevant as regards the only question under consideration in the present reference for a preliminary ruling, which is, where an advertisement infringing another person’s trade mark is reproduced, who is using the sign which is identical with or similar to that mark.”58.In [36] of the judgment in Daimler, [2016] ETMR 27, the CJEU had said, similarly “an advertiser cannot be held liable for the independent actions of other economic operators, such as those of referencing website operators with whom the advertiser has no direct or indirect dealings and who do not act by order and on behalf of that advertiser, but on their own initiative and in their own name.” 59.Mr Aikens submitted that as the Defendants had removed the relevant product pages from iKoustic’s website when it ran out of particular goods, the use of a Mark in an ad generated by the dynamic ads service from a deleted page could not be said to result from use of the Mark by the Defendants. The Defendants should not be found to have infringed where such an ad was not generated by current use of a Mark but only due to a time lag between the page being taken down and the site being "crawled" by the search engine. In my judgment, the difficulty for the Defendants is that despite taking down the particular webpage they had done nothing to block it from the dynamic ads service. As a result, this case is not like Daimler, where after determination of the contract between Daimler and the defendant, the latter had taken all reasonable steps to get third parties to take down or amend advertisements which used the mark, or like mk advokaten, where the advert had been reproduced without the defendant’s consent. Instead, here the adverts complained of were generated by the Defendants’ use of the Google service, not by a third party on its own initiative. The Defendants employed Google to produce the ads for it, and had they wished to do so they could have controlled the material to be included or excluded in adverts. The availability of negative matching in particular meant that these Defendants had the capacity to control of the use of the Marks generated by the dynamic ads services. Mr Parsons was asked about his knowledge of negative matching and said that he was aware that there were methods to do that, even if he was not aware of the mechanism for negative matching in the document shown to him at trial. Google was acting on the Defendants’ behalf. I am therefore satisfied that use of the Marks in those ads, even without positive choice of the terms, did amount to use by the Defendants. 60.In Google France, the CJEU explained when use of a mark in an internet advertisement might infringe: “84. The function of indicating the origin of the mark is adversely affected if the ad does not enable normally informed and reasonably attentive internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party (see, to that effect, Céline, para.27 and the case-law cited). 85.In such a situation, which is, moreover, characterised by the fact that the ad in question appears immediately after entry of the trade mark as a search term by the internet user concerned and is displayed at a point when the trade mark is, in its capacity as a search term, also displayed on the screen, the internet user may err as to the origin of the goods or services in question. In those circumstances, the use by the third party of the sign identical with the mark as a keyword triggering the display of that ad is liable to create the impression that there is a material link in the course of trade between the goods or services in question and the proprietor of the trade mark (see, by way of analogy, Arsenal Football Club Plc v Reed (C20/01) [2002] E.C.R. I-10273; [2003] R.P.C. 9, para.56, and Case C-245/02 Anheuser-Busch Inc v Budejovicky Budvar národní podnik (C-245/02) [2004] E.C.R. I-10989; [2005] E.T.M.R. 27, para.60). 86.Still with regard to adverse effect on the function of indicating origin, it is worthwhile noting that the need for transparency in the display of advertisements on the internet is emphasised in the European Union legislation on electronic commerce. Having regard to the interests of fair trading and consumer protection, referred to in recital 29 in the preamble to Directive 2000/31, Art.6 of that Directive lays down the rule that the natural or legal person on whose behalf a commercial communication which is part of an information society service is made must be clearly identifiable. 87.Although it thus proves to be the case that advertisers on the internet can, as appropriate, be made liable under rules governing other areas of law, such as the rules on unfair competition, the fact nonetheless remains that the allegedly unlawful use on the internet of signs identical with, or similar to, trade marks lends itself to examination from the perspective of trade-mark law. Having regard to the essential function of a trade mark, which, in the area of electronic commerce, consists in particular in enabling internet users browsing the ads displayed in response to a search relating to a specific trade mark to distinguish the goods or services of the proprietor of that mark from those which have a different origin, that proprietor must be entitled to prohibit the display of thirdparty ads which internet users may erroneously perceive as emanating from that proprietor.” 61.The Claimants accept that this is not a case in which the advertisements generated by use of Google adwords or the use of Google dynamic advertising are unclear or misleading on their face, as described in Google France, and explained by the Court of Appeal in [98] of Interflora. The advertisements are for the Claimants’ products, whether the terms were dictated by the Defendants or the Google dynamic ads process. Their complaint was that the advertisements enticed potential customers for the Claimants’ goods to the Defendants’ website, and then to contact iKoustic, which would seek to supply the Defendants’ goods instead. The customer was deceived into making contact with iKoustic, so that the Defendants could sell him their own goods. The Claimants complained of the legacy effect discussed above, but more importantly alleged that the Defendants continued to advertise goods for sale by reference to the Marks when they had insufficient stocks of them to satisfy normal orders, which they said also led to switch selling. 62.Mr Parsons produced spreadsheets showing that far fewer click-throughs to the iKoustic website were generated by use of the Marks than by searches on more descriptive keywords like “soundproofing walls.” His first spreadsheet showed that where such a search term had been used (such as “genie clips soundproofing”) that phrase had not been chosen as a keyword by the Defendants but was dynamically matched by Google. A second spreadsheet with his 4th witness statement showed more accurately the number of clicks through to the iKoustic website generated by these ads, a total of some 650 clicks.Use of the Marks on iKoustic’s website63. As I have said, the Defendants’ pleaded position was that as goods became unavailable, the relevant pages were removed from iKoustic’s website. In his 2 nd witness statement, Mr Parsons set out a rather more complicated picture. On the one hand, he confirmed that as iKoustic sold out of a particular product or decided it was unable to sell its remaining stock, the relevant pages were removed from the website. Where a search engine produced a link to a page that had been taken down, this would default to the Existing Customers Login page. One such example related to the GENIEMAT FIT08. The Amended Particulars of Claim referred to a search in February 2019 for this product (Annex A) leading to the Existing Customers Login page (like that at Annex B). At the time iKoustic thought it had none of the product in stock (a stray roll was found in a stocktake in late 2019). I consider that use of the Mark in the search result amounted to use of it by the Defendants, although the advertisement did not link to a display of the Mark on the iKoustic website. 64. The position was different where iKoustic had stock left of a particular product. Mr Parsons said that as stocks were depleted the individual products became more difficult to sell as the stock was held in quantities which meant it was suitable only for certain projects. Due to his concerns that an order might be placed online which could not be fulfilled, the pages relating to such products on the website were changed to say "This product is not available to buy online." See an example of such a page at Annex B. That was the position for instance for the GENIEMAT FF10 from February 2019, pleaded as infringing at that date in the Amended Particulars of Claim. The Defendants said that the particular search results relied upon by the Claimants in relation to this product were natural search results, not prompted by the Defendants’ use of the Google ad services, (though possibly one was generated through Shopping) but in any event, it is clear that a search using the Mark with the product code could have led to links to the relevant pages of the iKoustic website which displayed the Mark. 65. Mr Parsons said that the purpose of saying that the product was not available to buy online was to ensure that a potential customer would contact iKoustic to discuss the project and the quantities required. Mr Parsons also justified the use of such a notice by saying that the goods are technical products and required bespoke guidance to the customer. Mr Parsons said that if a customer wanted more stock than iKoustic could supply, they would be asked whether they would accept an alternative product, i.e. the MuteClip or MuteMat products, and there were examples of this happening in the documentary evidence. Mr Parsons did not accept that the stock levels made it impossible to sell off the remaining stock, but only that, realistically, iKoustic could not supply customers needing larger quantities of products . The same message was also used in at least one instance, on 5 December 2019, in relation to a MuteMat product, which in my judgement confirms that the Defendants may have had a genuine commercial reason for placing such a notice on a product webpage, unconnected with their use of the Marks. 66. The Claimants relied heavily upon these parts of Mr Parsons' witness statement, suggesting that the inconsistencies in Mr Parsons’ evidence showed that he was lying as to his motivation and that his witness statement showed that the Defendants were not using the Marks for the purpose of selling the Claimants' goods - the real purpose was to sell the Defendants' competing products. They suggested that the purpose of requiring a customer to contact iKoustic rather than buy Genie goods online was to enable the Defendants to try to switch sell the customer the Defendants’ own goods. 67.I do have one concern about Mr Parsons’ explanation that a product would be shown as unavailable to buy online where bespoke technical advice was required before purchase. It seems to me that if technical advice were required that would always have been the case, and so that explanation cannot have applied to products which were originally made available to buy online. However, I do not believe that any such products were identified by the Claimants nor was this point about the need for technical advice dealt with in any detail in evidence, so it is hard to draw any conclusions about the legitimacy of this usage. I accept that it is unhelpful that the alternative explanation about stock levels given by Mr Parsons was not pleaded, but I do not consider that Mr Parsons’ 2nd witness statement contradicted the Defendants’ case or showed that he was trying to mislead the Court. 68.In around April 2019 the iKoustic website was updated to show that the GENIECLIP product was not available to buy online, apparently because the clips have to be used with furring channels which were no longer in stock. However, some clips which remained in stock were eventually sold to a customer which had sufficient stock of the furring channels in December 2019, and Mr Parsons said that all references to the Marks on the website were then removed. The Claimants complained in the Amended Particulars of Claim, however, about one particular use of the GENIECLIP Mark on the website. This was seen on 30 October 2019; I do not know when the page went up. This is the use shown in Annex C of a page for GENIECLIPs, which in addition to saying that the product was not available to buy online, said that GENIECLIPs were no longer stocked and invited the customer to contact iKoustic: “Click Here (http://www.ikoustic.co.uk/products/wall/muteclip) to find out about iKoustic’s new alternative sound isolation clip. If you only want GenieClip® and are not interested in the alternative sorry we couldn’t help you.” This is all rather odd. The webpage wrongly makes it sound as if no GENIECLIPs were then in stock. A customer looking at that page of the website could not have known that there was any residual stock. They might then have contacted the Defendants, or clicked through to the MuteClip page, or tried to buy GENIECLIPs elsewhere. Although Mr Parsons’ spreadsheets show some clicks being generated on searches for GENIECLIPS, I cannot tell whether anyone contacted the Defendants via this particular page when it took that form.69. In his 2 nd witness statement Mr Parsons also said “iKoustic held residual amounts of GenieMat products which it had purchased and was entitled to sell but was required to hold in reserve for marketing purposes.” He did not explain what he meant by being “required” to hold those products, nor what marketing purposes he had in mind, but went on to say that iKoustic did not market residual stock “until I determined I needed to sell my remaining stock.” These comments were not clarified in the oral evidence, and I cannot draw any firm conclusions from them. 70. I understand the Claimants' suspicions in the light of the various explanations given by Mr Parsons, but, weighing up all of the evidence, I do not accept that Mr Parsons' evidence showed that iKoustic’s use of the Marks was a sham, aimed at attracting custom for its own goods. It seems to me that changes to individual webpages may, as he said, have reflected the reality that iKoustic was running low on stock of particular product lines. Other uses – direct to customers 71. I deal below with the Claimants’ complaints about the use of the Marks in dealings with the Defendants’ customers where iKoustic allegedly switched or sought to switch customers who were enquiring for the Claimants’ products to the Defendants’ alternative.Infringement 72. As I understand it, the Claimants do not suggest that it was an infringement for iKoustic to use the Claimants' Marks in, say, December 2018, when it was holding a reasonable amount of stock, although it had begun to offer its own products to customers. If they do allege that this was an infringement, it does not seem to me to be correct. At that time iKoustic had thousands of the Claimants’ products in stock, so in my view it was entitled to use the Marks to sell them, and the Claimants accepted that the adverts returned by searches using the Marks were intended specifically to refer to the Claimants’ goods. Indeed, the Schedule shows that iKoustic did sell quantities of the Claimants’ goods between November 2018 and April 2019. 73.The Claimants put their case of infringement on two bases. a)First, they said that the Defendants' motivation in using the Marks was not genuinely to sell their stocks of the Claimants' goods, but to attract custom for their competing goods. I think it was common ground that this question was to be judged by reference to whether the average consumer would see the advertisement/use of the Mark as distinguishing the Claimants’ or someone else’s goods, and the average consumer of the Claimant’s goods was agreed to be a professional rather than a domestic customer. Mr Downey accepted that the small domestic customers served by iKoustic would be less likely to know of the Claimants’ goods by name, and would be more likely than professionals to find their way to the iKoustic website by use of generic search terms rather than use of the Marks. b)Secondly, the Claimants said that the exhaustion defence could not apply where the Defendants had no stock of goods bearing the Marks, or insufficient stock to satisfy a normal order. 74.The Claimants alleged that whilst the webpages or adverts were advertising a particular product by reference to the Mark, this was a sham because the Defendants had no intention of providing those goods. Mr Parsons denied this. He said that when stock ran out of a product, the webpage for it was removed and I do not think that this was disputed. When that had happened the only use of the Marks in relation to such goods was through the failure to negative match terms in the dynamic ads service. Given the Defendants’ prompt removal of the pages from the website, it does not seem to me that the failure to use the negative matching facility shows that the Defendants' real motivation was to continue to attract custom for their goods by use of the Marks on those pages, as opposed to carelessness or a lack of full understanding of the failure to negative match those pages. I discuss this further below in relation to the section 12/Article 15 defence.75. The exception lies in the page shown at Annex C, which in my judgment invited customers to choose MuteClips instead of GENIECLIPs and so could be seen as use in relation to the MuteClips. Nevertheless, the average consumer seeing the explanation on that page and the link to the MuteClip page cannot but have realised that this was a reference to an alternative to the Claimants’ goods. No-one clicking through from that page would have been confused as to what they were doing or as to the trade origin of the MuteClips. 76. By contrast, as already discussed, where stocks of a particular product ran low, the message was displayed on the relevant webpage stating that the product could not be sold online. Mr Parsons said that if an inquiry was made by a customer a discussion would be held as to whether there were sufficient stocks to assist. If not, he and his staff would ask whether the client was interested in an alternative product and only then offer an alternative product. Bait and switch selling? 77. Various instances of alleged switch selling were identified in the Amended Particulars of Claim. Some of these (for instance, an allegation of an attempt to switch sell to an architect, Ms Humphries) were not pursued at trial, but as I have said above, other transactions were the subject of cross-examination and listed in the Schedule. The Schedule refers to a large number of incidents, inquiries and sales which were said to demonstrate how the alleged switch selling was done. Only a small selection of these were considered during the trial. I have looked at documents relating to a number of other transactions identified in the evidence and Schedule, bearing carefully in mind that in some instances I had only the Claimant’s comments in the Schedule and had not heard the Defendants at all on the details of or impact of these documents. 78. First, it does not seem to me that the documents relied upon by the Claimants show that all of the transactions or inquiries flowed from any use of the Marks by the Defendants. Indeed, the first example discussed by Mr Silverleaf in opening appeared to me to relate to an inquiry in January 2019 for a third party product, Regupol. At that stage, iKoustic suggested using GENIEMAT products and sought additional supplies from the Claimants. The new products were mentioned, but not available. This does not seem to me to show switch selling of MuteMat for GENIEMAT or even an attempt to switch. In another example from January 2019, Mr Silverleaf QC asserted that the customer, Mr Jasbro, had asked for GENIEMAT. This was not at all clear from the documents, but inferred because Mr Woodhouse sent him a quote for “a couple of options” including the Claimants’ goods, as well as for a “more costeffective option, MuteMat.” Mr Jasbro chose the GENIEMAT. There is nothing to show how he came to contact iKoustic, and whether that was due to use of the Mark by the Defendants. In any event, at that time the Defendants had enough stock of the GENIEMAT RS10 for Mr Jasbro’s needs. In my view there was no bait, and no switch, but a transparent offer of both parties’ goods.79. It is clear that existing customers would email iKoustic with inquiries or to place orders, and in my view the Claimants have not proved that all such contacts were made due to use of the Marks by the Defendants at that time; rather, customers approached iKoustic knowing it had previously been a supplier of the Claimants’ goods. For example, in January 2018, a Ms Jandu had been given a quote for GenieClips and channels. She emailed in May 2019 asking for an updated quote. She was offered MuteClips instead. It is unclear whether she bought them, but so far as I can see the documents do not show that her approach to iKoustic arose out of use of the Marks by the Defendants in May 2019. 80.Other inquiries for the Claimants’ products did come through the iKoustic website, but the Defendants’ response was not simply always to offer a Mute product, and it is not always clear whether any sale followed. In some cases, people were told (for example, in an email dated 11 October 2019 to a Mr Bargh) that iKoustic was no longer a distributor of the goods, without mention of the Mute product. Other customers inquiring for the Claimants’ goods were told that they were unavailable or that stocks were low. For example, Mr Windle’s witness statement listed an inquiry about the product’s decibel rating which came from a webpage advertising the GENIEMAT RST05. At that time, in April 2019, iKoustic had 47 rolls of RST05 in stock. The customer was given the requested data but told “we are running stock down on this particular product range since we launched our own range.” Information was given about the MUTEMAT. When the customer did not get back to iKoustic, Mr Woodhouse emailed to say “Let us know if you have any current projects that require GenieMat® RST05, as we do have a few hundred m2 left. Once this stock has gone, we won’t be bringing any back in.” Mr Windle accepted that this amounted to no more than iKoustic trying to sell off its old stock of the Claimants’ products and promoting their new replacements.81. Another unpleaded instance of alleged infringement raised in Mr Windle’s witness statement arose from an email from Mr Woodhouse to a potential customer in February 2019 clearly offering three alternative solutions, including two GENIECLIP products and one MuteClip product. The inquiry came through the website, but it is not clear whether or not it arose from use of the Marks, or whether the customer asked for the Claimants’ goods, as the subject line of the email is just “ikoustic soundproofing.” The links given in the email supposedly to the GENIECLIP products were actually links to a MuteClip page on the iKoustic website. Mr Parsons ascribed this to teething troubles when the new products were put onto the system and various references to the Marks were taken off it. He said that no sales arose from it. It seems to me that if the recipient of that email had tried to click on a GENIECLIP link and been presented with a MuteClip page, he would have been bound to realise that it was an incorrect link to a different product. In my view it is unlikely that this was a deliberate ploy by the Defendants to sell only MuteClips, given that they quoted for two GENIECLIP products. The email itself appears to me to be another example of the Defendants offering competing products alongside the Claimants’ goods, but otherwise does not seem to me to fall clearly within any of the kinds of acts alleged to infringe in the pleadings. I am not persuaded that this was an example of use of the GENIECLIP Marks in relation to MuteClips, as the reference to GENIECLIPs appears to have been a genuine reference to the Claimant’s goods, though coupled with the wrong link, which used the MuteClip name for MuteClip products. 82.A similar complaint, again unpleaded, was that a “case study” on the iKoustic website, most probably put up in February 2019, described the use of MuteClips, when the clips used in late 2018 must have been GENIECLIPS. The case study on iKoustic’s website stated “We specified the use of our Acoustic Isolation Clip and Channel system” without reference to the Marks, and giving links to the pages for MuteClips. Mr Parsons thought that this happened because at that time the Defendants had been asked to remove references to the Marks from the website. Whether or not that was the correct explanation, and whether or not it was appropriate to suggest that MuteClips were used when they were not, I am not persuaded that this incident showed any use of the Marks by the Defendants, still less any infringing use. 83.Three cases where iKoustic offered customers the Mute products as an alternative to the Claimants’ goods were explored in cross-examination with Mr Parsons and relied upon by the Claimants in closing. The Claimants submitted that the Defendants’ products were substituted for the Claimants’ goods in these cases without the substitution being made clear to the customer. These were:a)A sale of MuteMat to Rainbow Master Builders in January 2019: on 28 January 2019, an email was sent to Mr Woodhouse by Mr Dabrowski of RMB (plainly an existing customer or contact as they were on first name terms) to order 200m2 5mm GENIEMAT. Mr Woodhouse replied the following day explaining that the price of GENIEMAT had increased, and quoting for “a couple of options” namely the GENIEMAT and the cheaper MuteMat alternative. A flurry of emails followed between Mr Woodhouse and a Mr Walczak, apparently an employee of Mr Dabrowski’s company. The client bought the MuteMat. It is abundantly clear from an email from Mr Walczak sent on 29 January that he appreciated that this was a different product. b) A sale of MuteMat to Baillie Homes again in January 2019: an existing customer Mr Baillie asked for a quote for GENIEMAT RST05 and was sent a quote both for the GENIEMAT and for MuteMat. At that time, iKoustic had more than enough RST05 to have supplied it to the customer had he chosen to buy it. The email from Mr Youngson of iKoustic made it clear that the latter was a new product, and described it as cheaper and better performing than the GENIEMAT. Mr Baillie bought the MuteMat. In my view, the emails show that he understood that this was a different product from the GENIEMAT. c)A sale of MuteClips to a Mr Trobridge, a domestic, repeat customer, in February 2019: Mr Silverleaf QC cross-examined Mr Parsons about this sale on the basis that the original specification for the work given on 3 January 2019 included both GENIECLIPS and furring channels, but MuteClips were supplied instead.The evidence does not show how it was that Mr Trobridge was offered or chose to buy the Claimants' goods, so there was no “bait” shown, but there was use of the Marks at least in the specification. In cross-examination, Mr Parsons said that he recalled the sale and the change was made for technical reasons. Both parties submitted brief additional points in writing about this transaction. The Defendants said that the MuteClips were supplied because Mr Trobridge wished to cut the costs of the project, and it is clear from the email exchanges that Mr Trobridge was price sensitive as well as rather unhappy about some delays in installation. In various emails in January, Mr Woodhouse said that they might use a cheaper GENIECLIP, or he suggested “If the new clips are in stock, we will swap to the new clips and refund the difference.” Those emails could only have made sense to Mr Trobridge if someone from iKoustic had told him about the new products, presumably in a telephone call or visit. The Claimants contended that Mr Parsons' explanation for the substitution was not consistent with the documents and there was no evidence that the nature of the substitution was made clear to Mr Trobridge or that he was told that the new clips were of different trade origin. They suggested that this meant that there was infringement by substitution after sale, but I am satisfied that the substitution would have been clear to the customer, and he would have realised that the goods were of a different trade origin, from the emails and from the credit note he received following supply of “our more competitively priced MuteClip XP and MuteClip Channels.” Alternatively, the Claimants said that this was infringement by use of the Claimants' Mark in relation to its goods in circumstances where the intention was, having made a sale using the Mark, to substitute the Defendants’ goods, so that the Claimants could object to the re-commercialisation of their goods under Article 15(2) of the EUTMR. I consider this point below in relation to the Article 15 defence. d)After receipt of the draft of this judgment, the Claimants invited me to deal with an additional example of alleged switching. Cambridge Garden Studios appears to have placed an online order for 195 GenieClips, and some furring channels on 12 April 2019, and paid by credit card. iKoustic did not have sufficient stock to satisfy that order. The invoice shows that the customer was supplied with MuteClips and channels, and states “Original online order was £2,333.57. Materials were altered and refund of £219.67 was refunded back to card by RW.” RW was plainly a reference to Mr Woodhouse. Mr Parsons was cross-examined about this. He appeared not to be familiar with the transaction, which was unpleaded and not referred to in the evidence, though identified in the Schedule. He said that there would have been a telephone call to the customer about the order. The Claimants submitted that this explanation was unconvincing, and this was one of the instances in which (they said) Mr Parsons was making things up as he went along. However, Mr Parsons was not taken to a copy of an email also dated 12 April 2019, sent by Mr Woodhouse to Cambridge Garden Studios, in which he referred to a telephone conversation with them, as well as to the alteration in the order and the refund. In the circumstances, it seems to me that the substitution was more likely than not agreed with the customer, and the Claimants have not proved that the MuteClips were substituted for the GenieClips without the client’s knowledge and consent. 84. If bait and switch selling amounts to infringement because, as Mr Hobbs put it in Whirlpool , “the process of buying goods or services should, from selection through to purchase, be free of the distorting effects of confusion” or, alternatively, bait and switch selling is a sub-set of initial interest confusion, I am not persuaded that there is any infringement by bait and switch selling here, especially as the Claimants conceded that this was not a case in which there was any confusion. That concession seems to me to be realistic in the light of the examples described above. In cases in which an existing customer contacted iKoustic thinking that it was a distributor of the Claimant’s goods, the documents show that iKoustic made it clear to customers either that they had ceased to be a distributor for Pliteq, or that that they were offering them an alternative product. Certainly, that was the case for at least three examples put to Mr Parsons in cross-examination discussed in the last paragraph above. 85. In cases in which a customer got to the iKoustic website via a search engine, having used a search term including one of the Marks, faced with either the contact page or the message that the products were unavailable to buy online and having decided to pursue it by contacting iKoustic, the documents which I have seen again appear to show the customer being offered various alternatives, in terms which should have made clear to them that an alternative product was being offered to them. 86.In my view, the infringements alleged here are not “classic” bait and switch selling. The case can be distinguished on the facts from the types of bait and switch infringements found by Mr Baldwin QC in Cosmetic Warriors. In that case, Amazon had no Lush goods at all to sell, and never had stocked them. It was not using the mark in relation to the claimant’s goods, but just to stimulate interest in its competing products. Furthermore, the fact that Amazon did not have genuine Lush goods to sell would not have been apparent to the average consumer (see [42]). Here, iKoustic did have a stock of genuine goods bearing the Marks used in most of its dynamic ads (the exception being where the ads had not kept up with changes made to the website when products were out of stock) and on its website and relies on the exhaustion defence. Further, I am satisfied that the average consumer would have understood from the various communications from the Defendants (including the webpage at Annex C) that the Defendants were offering an alternative product to the Claimants’ goods.87.Bait and switch aside, the question remains whether any of the Defendants’ uses of the Marks infringed because they affected the origin, advertising and investment functions of the Marks. I keep in mind Arnold J’s observation in Och Ziff at [88] that in a double identity bait and switch case an effect on one of the functions of the trade mark will not be hard to find. The Claimants said that all three functions were affected by the Defendants’ uses of the Marks. 88.First, the Claimants submitted that damage to the origin function was inevitable when there was substitution of goods without the customer’s agreement or knowledge. That may be right as a proposition of law, but I am satisfied that the customers who bought Mute products in the examples discussed above were or would have been aware that they had a different origin to the Claimants’ goods. The Claimants’ submissions amounted to saying that offering any competing products to a potential purchaser affects the origin function, even where the consumer understands that he is buying a substitute. I do not accept that is right. It does not seem to me that the origin function is harmed when alternative products are offered to a customer who has inquired about goods by reference to a mark; at least in the absence of any obligation to sell the Claimants’ goods exclusively, this seems to me to be an everyday and unobjectionable commercial reality. Mr Silverleaf QC gave an example of advertising Adidas trainers but supplying Puma trainers, which he said would be use of the mark Adidas in relation to Puma goods. However, it is commonplace to be offered alternatives to goods one has asked to see, or looked at on a website, and the fact that a shop or other outlet may have advertised its stock of goods by reference to a registered mark does not necessarily mean that there is any infringement in advertising, offering for sale or selling other branded goods as an alternative to the product requested. A consumer might well ask for Adidas trainers but be happy to buy trainers of another make. Such sales would not, it seems to me, affect the origin function of the Mark unless the substitute goods were supplied without the proposed substitution being drawn to the customer’s attention, which I find was not the case here. 89.Alternatively, if the Marks were used to refer to the Defendants’ goods I accept that in the light of the authorities I have cited above the origin function would be adversely affected. The existence of any such infringement is, therefore, inextricably linked to the exhaustion defences upon which the Defendants rely and to the analysis of the facts – was the Defendants’ use of the Marks made in relation to the Claimants’ goods? 90.As to the advertising and investment functions, the Claimants acknowledged that at [57]-[59] of Interflora, the CJEU held that the advertising function was not adversely affected by keyword use. Otherwise, they submitted that iKoustic’s conduct undermined both the advertising and investment functions of the Marks because it used the Marks to attract custom for its own products, impairing the ability of the Marks to enable the Claimants to maintain customer loyalty. The Defendants contended there could be no effect on the advertising or investment functions where the customer was fully aware of the source of the goods; the investment function does not protect trade mark proprietors against the effects of fair competition, even if such competition means that they have to adapt their efforts to preserve a reputation capable of attracting and retaining customers. 91.I am not persuaded that the Defendants’ use of the Marks affected the advertising function, as it does not seem to me that was any evidence that their use affected the Claimants’ use of the Marks as a factor in sales promotion or as an instrument of commercial strategy. As for the investment function, bearing in mind the passages from the judgments of the CJEU in Mitsubishi and Interflora set out above, I think it fair to infer that any use of the Marks by the Defendants in relation to their goods, rather than the Claimants’ goods, might substantially interfere with the Claimants’ use of the Marks to preserve a reputation attracting consumers and retain their loyalty. The investment function might therefore be affected, unless the Defendants were competing fairly, and the only consequence of their use was (as stated in [64] of Interflora) to oblige the Claimants to adapt its efforts to protect its Marks’ reputation. The fact that some consumers might switch to the Defendants’ goods would not, in circumstances of fair competition, infringe the investment function. The only example of use which it seems to me was not fair competition was the page shown at Annex C, which effectively advertises MuteClips by use of the GenieClip Mark and this use could therefore have interfered with its investment function.92. The ad generated for the GENIEMAT FIT08 would have fallen into a separate category from the other uses described above, if generated at a time when the Defendants had no stock of that product. It seems that the Defendants thought they had no stock of the goods, but the Schedule suggests they may have had a stray roll in their possession. Nevertheless, as the ad linked to a webpage which made no use of the GENIEMAT Mark, I am not persuaded that it affected any of the functions of the Mark. The Schedule identified a single quote being given for the product in January 2019, which does not appear to be linked to the ad. On balance, I do not think that the ad has been shown to have affected the Marks’ functions so as to be an infringement. 93.Otherwise, I conclude that the question of the infringement of the Marks again turns upon whether or not the Defendants were using them in relation to the Claimants’ goods. If they were, then that would be fair competition, and would not be liable to affect the investment function. That issue applies equally to the applicability of the exhaustion defences relied upon by the Defendants. The section 12/Article 15 defences 94. The Defendants relied upon the exhaustion of the Claimants’ trade mark rights, saying that their use of the Marks fell within section 12(1) of the Act and Article 15(1) of the EUTMR. These provisions are in essentially the same terms. The latter provides; Article 15