Case No. EWHC-3296-(IPEC)

75. Under s.10(3), liability can arise in respect of any of three types of injury, (a) detriment to the distinctive character of the mark, (b) detriment to the repute of the mark and (c) unfair advantage being taken of the distinctive character or repute of the mark. Equisafety relies on all three of these types of injury. 76. Guidance as to these three types of injury was provided by the Court of Justice in Case C-487/07 L'Oreal v Bellure NV at [39]-[41]: “39. As regards detriment to the distinctive character of the 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 is weakened, since use of an identical or similar sign by a third party leads to dispersion of the identity and hold upon the public mind of the earlier mark. That is particularly the case when the mark, which at one time aroused immediate association with the goods or services for which it is registered, is no longer capable of doing so (see, to that effect, Intel Corporation, para.29). 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. 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.” Injury to distinctive character 77. As regards injury to distinctive character, further guidance was provided in Sky v SkyKick [2018] EWHC 155 where Arnold J. pointed out at [310] that the stronger the mark’s distinctive character, the easier it will be to find that detriment has been caused to it. However, the mere existence of a link is not enough, the proprietor must still prove actual injury or a serious likelihood of injury in the future. 78. In support of Equisafety's case, Mr Selmi argues that detriment is clear from the fact that Equisafety's turnover has dropped from the high £400ks in 2016-2018, to the low £300ks in 2019 and 2020. The difficulty with this is that I have no evidence to assist me in determining what proportion of that turnover or of that decline related to Equisafety's Mercury products. Similarly, Ms Fletcher's evidence was that online sales of Equisafety’s Mercury products dropped by 50% in the period 2019/2020 compared with the period 2018/2019. Again, no information or supporting documentation was provided as to the actual figures involved. 79. Whilst this lack of information and of supporting documentation was less than helpful (particularly given that the burden of proof is on Equisafety and that the figures are, presumably, within its knowledge), the factors that led me to conclude that there was a likelihood of confusion also lead me to conclude that that there is the requisite detriment. Accordingly, I find that Battle’s use of the word mercury in relation to high visibility equestrian products is bound to diminish the ability of Equisafety's Mercury mark to act as a designation of origin of its Mercury products. Injury to repute 80. In support of Equisafety’s claim that the reputation of its mark has suffered or might suffer, Ms Fletcher asserts that Equisafety’s products are made of a fabric which enhances rider safety in all light conditions, whereas Battle’s products are of inferior quality and use a fabric that “blends into daylight and therefore only potentially enhances rider safety in low light environments”. However, I have seen nothing to support these assertions. In particular, I have not seen the rival products (other than in poor quality pictures) and there is no meaningful evidence of the sort of comparison or testing of those products that would allow me to reach any conclusion as to whether there is any merit in Ms Fletcher’s assertions. I therefore reject Equisafety’s claim insofar as it relies on injury to repute. Unfair advantage 81. The third type of injury that can give rise to liability under s.10(3) is where the use complained of takes unfair advantage of the distinctive character or repute of a registered mark. In determining this, factors such as the strength of the mark's reputation and of its distinctive character will be relevant, as will the degree of similarity between the mark and the sign in issue and the degree of similarity between the relevant goods or services. The more immediately and strongly the mark is brought to mind by the use of the sign, the greater is the likelihood of this type of injury. 82. Applying these principles, it follows from my conclusions regarding the distinctive character of the Mercury mark and the likelihood of confusion, that Battle’s sign, by including the word mercury, does take unfair advantage of the Mercury mark. In effect, in using that word for its high visibility equestrian products, it is benefitting from Equisafety’s investment in the Mercury mark without paying anything for it. 83. A factor that can be relevant in unfair advantage cases is the defendant’s intention. In this regard, a person’s conduct is most likely to found to be unfair where that person had intended to take advantage of the reputation of a trade mark. However, such an intention is not a necessary element for liability under s.10(3). As Arnold J pointed out in Sky v SkyKick [2018] EWHC 155 (Ch) at [315]— “… .there is 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 and goodwill of the trade mark amounts to unfair advantage even if it is not proved that the defendant subjectively intended to exploit that reputation and goodwill. Counsel for SkyKick did not challenge that conclusion.” 84. In the present case, Battle’s intentions when it released its products under the HVSMR label are unclear because the only evidence before me is that of Mr Dewey. That evidence was to the effect that he was not aware of Battle’s range let alone of Equisafety’s Mercury products until he received Ms Fletcher’s letter of complaint of 6 June 2019. Mr Dewey suggested that any monitoring of competitor products was likely to be done by Battle’s commercial manager, Anna Clarke and, certainly, after receiving Ms Fletcher’s letter of 6 June, it was to Ms Clarke that Mr Dewey directed his email questioning “why did we call it mercury?” 85. On balance, given my conclusions regarding the use that Equisafety had made of the Mercury mark, I think that Battle should have done more to provide the court with evidence which answered Mr Dewey’s own question by, for example, calling Ms Clarke. As Battle chose not to do so, I think that the court is entitled to draw an inference that is adverse to Battle and to conclude that whoever was involved at Battle in the launch of its HVSMR range must have been well aware of Equisafety’s use of the Mercury mark. Even if this were not so, Battle was clearly aware of that use after it received Ms Fletcher’s email of 6 June and yet it went on to extend its range of products marketed under the HVSMR label.