[2023] EWHC 2176 (IPEC)

I shall deal first of all with the question of the chain of title. Dr Spiller had been an employee of BICC Plc prior to 1999 and his evidence was that BICC’s cables business was purchased by “General Cable” after which the business became known as BICC General. He gave evidence that after the purchase the BICC General name was used to replace (or over-sticker) the name BICC where possible and the corporate colours were changed on letterheads etc to General Cable’s blue/green.

The relevant transactions date back to 1999-2000, and despite the passage of time a number of relevant documents have survived. The Claimant’s pleaded case was that General Cable Corporation acquired the BICC business from BICC Plc in April 1999, and that General Cable Corporation and/or companies under its control used the sign BICC in the United Kingdom. It said that in around August 2000, Pirelli acquired all of the shares in four UK BICC cable companies from General Cable Corporation. At both stages, it said, the goodwill in the name BICC passed to the purchaser of the business and then was transferred to the Claimant.

The first document relied upon by the Claimant was a sale and purchase agreement dated 6 April 1999 between BICC Plc, GK Technologies, Inc and General Cable Corporation (the “GK Technologies Agreement”). The Agreement related to BICC companies in numerous jurisdictions and runs to some 250 pages. Like the other title documents before me, the Agreement was drafted by solicitors and clearly the product of an enormous amount of work and negotiation. BICC plc was the vendor under that agreement and GK Technologies, Inc, a New Jersey company, was the purchaser. General Cable Corporation, a Delaware company, (“GCC”) was the purchaser's guarantor. As the Defendants pointed out, therefore, GCC was not named in the Agreement as the purchaser of any of the BICC Plc assets.

On the other hand, the Agreement defined both a “Relevant Seller” and a “Relevant Purchaser”. Relevant Sellers were listed in Schedule 2 to the Agreement. They were BICC companies (the “Business Sellers”) identified as holding shares in a wider range of BICC companies in different jurisdictions. These Sellers included BICC Plc, BICC Cables Ltd and BICC Components Ltd. Relevant Purchasers included not just GK Technologies Inc, but also any member of the Purchaser’s Group nominated (prior to completion) as the purchaser of shares in any company. I do not know whether GCC was a member of GK Technologies’ group of companies and there was no evidence before me directly showing that it was nominated before completion as the Relevant Purchaser of the BICC cables business in the UK.

By clause 2.1.1 of the GK Technologies Agreement each Relevant Seller sold the whole of the “Operations” (defined as the businesses carried on by the Business Sellers and Group Companies) comprising the shares and Businesses (defined, repetitively, as the businesses comprised in the Operations) as a going concern to the Relevant Purchaser. Clause 2.1.2 stated that the sale included the Goodwill, defined as the goodwill of each of the Business Sellers in connection with the Operations “together with the exclusive right … for the Relevant Purchaser to represent itself as carrying on the Operations … in succession to the relevant Business Seller.”

The provisions which I have set out above, it seems to me, tend to point to the inclusion of goodwill attaching to the BICC name used in connection with cables and cable components in the assets transferred to the Purchaser. However, the matter does not end there. The Defendants relied on the provisions of clause 18 of the GK Technologies Agreement which, they said, were inconsistent with such a transfer. It provided:

“18.5

NAME

18.5.1

The Purchaser shall, subject to clause 18.5, have the right to continue to use and the right to sublicence any of the Relevant Group Companies to use (but only for so long as such remain subsidiaries of the Purchaser) any trade marks and trade names used by the Defendant or in relation to the Operations and which are not comprised in the Assets sold hereunder on a royalty free, non-exclusive basis for a period of 12 months from the Completion Date, but solely on the products on and in the manner in which they were being used immediately before Completion …

18.5.2

The Purchaser shall be entitled to use and have the right to sublicence to any member of the Purchaser's Group (but only for so long as such remain subsidiaries of the Purchaser) the name "BICC" in conjunction only with the name "General Cable" as the name of any corporate entity … which … is primarily involved in the manufacture, sale or distribution of cables.

…

18.5.6

The Purchaser shall procure that within three months of Completion … it will remove “BICC” from the name of each Group Company … save as otherwise permitted by clause 18.5.2.”

I was also referred to Schedule 15 to the Agreement, which listed the Vendor’s intellectual property which was to be transferred to the Purchaser. This included numerous patents and trade marks, but no UK trade marks for BICC for cables, etc. The Defendant’s position was that this showed that although some goodwill was transferred to the Purchaser by the GK Technologies Agreement, this could not have included the goodwill relating to the BICC name and business. All that the Purchaser of BICC Plc’s assets got was a licence to allow for sell-through of BICC products.

Mr Clarke exhibited a document which appears to formalise such a licence. It was a licence dated 8 May 1999 made between BICC Plc, as licensor, and BICC General Cable Industries Inc and referring to what seems to be the GK Technologies Agreement. It described the rights granted as a “phase out” licence of the BICC trade marks and trade name. However, I consider that I may place little weight on this document, as it is not clear to me whether the licensee was one of the parties to the GK Technologies Agreement (having changed its name), or perhaps a Relevant Purchaser under it.

In any event, the GK Technologies Agreement, and clause 18.5 in particular, was swiftly varied by a Letter Agreement dated 27 May 1999, sent by GK Technologies and GCC to BICC Plc. Again, GK Technologies, not GCC, was described as the Purchaser. The Letter Agreement contained further provisions as to the BICC name. It stated at point 3.1 that in addition to the rights under clause 18.5.2 the Purchaser should be entitled to use and to sublicence any member of its group (for so long as it remained a subsidiary of the Purchaser) to use the name BICC in conjunction with the name General as the name of any corporate entity involved in the manufacture, sale or distribution of cables. At point 3.2(a), BICC plc agreed that the Purchaser and members of its group should have the exclusive right to use and sublicence use of the trade mark "BICC General" in connection with the Businesses, and agreed that BICC plc would not use the mark BICC or any mark including BICC, other than in connection with BICC's retained cables businesses. At clause 3.2(b) it was agreed that the Purchaser might register "BICC General" as a trade mark, and that BICC Plc would, at the Purchaser's request, cancel any of its own registered BICC marks registered for cable products, other than such products as relate to BICC's retained cables businesses. BICC Plc’s Annual report for 1999 suggests that there were some retained cables businesses, referring to Dubai Cable Co (Pte) Ltd, the transfer of which to GCC had not been completed, and to its Brand-Rex data and speciality cable business. That may explain the reference to retained cable businesses in the Letter Agreement on the basis that (as Dr Spiller said in evidence) no cables businesses were retained by BICC in the UK.

Next came the sale of the business to Pirelli in 2000. This was effected by a Share Purchase Agreement dated 9 February 2000 made between GCC and Pirelli. It was an agreement to transfer to Pirelli the shares in numerous companies worldwide, including 4 companies registered in England & Wales: BICC General Industrial Cables Ltd, BICC General UK Cables Ltd, BICC Supertension Cables (1980) Ltd and BICC General Rod Rollers Ltd. As in the 1999 Agreement, a Relevant Purchaser was defined as “any member of the Purchaser’s Group nominated prior to Closing by the Purchaser as the Purchaser of the Shares in any of the Companies.”

At this point the evidence about the identity of “Pirelli” becomes unclear. The Claimant’s case was that Pirelli Cavi E Sistemi SpA (the purchaser named in this Agreement) was the same company as the Claimant. However, the Defendants pointed out that the Purchaser named in the Agreement was an Italian corporation, whilst the Claimant is a company registered in England and Wales. A resolution of the Board of Directors of Pirelli General Plc dated 31 July 2000 stated that “Pirelli Cavi E Sistemi SpA had entered into a master contract with General Cable Corporation for the acquisition of some 19 companies worldwide forming part of the energy cables division of General Cable Corporation and [Pirelli General plc] had been requested by its parent company to purchase the four UK companies for a price not exceeding US$158 million.” It resolved to purchase those companies.

I was also taken to the Minutes of a Board meeting on 13 September 2000, which unfortunately do not seem to state which Pirelli company they are for. It is certainly possible that the company was Pirelli General plc, as the Minutes state that the company’s acquisition of the 4 BICC companies was completed on 25 August 2000. However, the Minutes also state that “the purchase agreement required that the names of the four acquired companies should be changed within one month after completion. At the same time each of these companies would appoint Pirelli Cables Limited (and where there were installation activities) Pirelli Construction Company Limited as its agent/s, so that all future business could be carried on in those names. In due course it was intended that the assets of all four companies should be acquired by Pirelli General Plc, but this could not take place until at least the end of the year …" This suggests to me that the Minutes were not of a Pirelli General Plc Board meeting, but those of another Pirelli company.

The first question is whether GCC was a purchaser of the BICC business, as a Relevant Purchaser nominated to take the BICC cable businesses in the UK pursuant to the GK Technologies Agreement. The Defendant suggested that this was not a point raised by the pleadings, but I think that it is what was meant by paragraph 4 of the Reply. There was no document plainly showing that to be the case. BICC Plc’s own annual report for 1999 said it had sold the cables business to GCC, but the language of the document permits the possibility that it is referring to the Group, rather than GCC itself. However, it is clear that in 2000 Pirelli thought it was buying that business (and the 4 cables companies) from GCC. Taking into account the complicated terms of the Pirelli Agreement, which was drafted by a US law firm, and the substantial sums paid for the cables business, I infer that Pirelli must have taken legal advice before entering into the share purchase agreement. I also think it right to infer that at that stage the chain of title to GCC will have been checked, along with GCC’s ownership of the shareholdings in the four UK cable companies. It would have been extraordinary for such basic checks not to have been done in the circumstances, and the chain of title should have been relatively easy to check, only a year after the GK Technologies Agreement. Furthermore, it was the evidence of Dr Spiller, Mr Montgomery and Mr Clarke (all of whom worked for GCC at the relevant time) that it was GCC which took over from BICC. In the circumstances, I am satisfied that I may infer that GCC was either nominated as a Relevant Purchaser under the 1999 Agreement or that there was an intervening transfer to it which has been lost with the passage of time.

Similarly, despite the rather patchy evidence before me, I am satisfied that I can infer that either prior to closing Pirelli General Plc was nominated as the purchaser of the four BICC cable companies in the UK, or another Pirelli company was the purchaser and intended (at least) to transfer those companies' assets to Pirelli General Plc. The Claimant pleaded that those companies’ trade and assets were transferred to it in about January 2001, but there was no evidence before the Court of such a transfer, nor so far as I am aware, was Pirelli General plc the previous name of the Claimant. I am not persuaded that in the absence of any explanation or documentation I may safely infer that any such transfer took place. On that basis, the Claimant has not made out a good chain of title.

However in case I am wrong on that, and Pirelli’s rights were properly transferred to the Claimant, I will go on to consider whether the Claimant was the successor in title to BICC Plc’s goodwill in the BICC name.

The Claimant referred me to a passage in Star Industrial Company Ltd v Yap Kwee Kor [1976] FSR 256, where Lord Diplock said at 269:

The Claimant relied heavily upon the fact that the businesses were sold in 1999 “as a going concern”, which, it submitted, would in the normal course of events carry with it the goodwill of the business purchased. I was referred to a passage in Wadlow, The Law of Passing Off, 6th Ed, at 3-403:

“An assignment of goodwill does not have to be in writing or any particular form, and need not mention goodwill by name. A transaction intended to assign a business as a whole necessarily passes the goodwill to the assignee…

In addition, the Claimant cited Newman v Adlem [2005] EWCA Civ 741, [2006] FSR 16 where Jacob LJ said at [21] it would be “strikingly unusual” for the sale of a business as a going concern to exclude the goodwill attached to the name of the business. In that case, however, the contract price included a substantial sum for goodwill, which was defined as “the goodwill and connection of the Business together with the right to represent the Purchaser as carrying on the Business in succession to the Vendor” and there was no mention of goodwill in a list of assets excluded from the purchase. Of course, I accept that it would be unusual to exclude goodwill from the sale of a business as a going concern, but equally I am clear that the question of whether the goodwill was included in the sale must be tested in light of the terms and proper construction of the particular contracts before the Court. Moreover, as the chain of title documents plainly do not provide a complete picture of the history of the matter, I think it right to take into account other contemporaneous evidence, both documentary and from the witnesses involved with BICC/Pirelli in around 1999/2000.

It is clear that the sale in 1999 (and so the assets later transferred to Pirelli) did not include the BICC registered trade marks. There is no mention of trade marks amongst the assets transferred by the GK Technologies Agreement. However, BICC Plc had owned numerous ‘BICC’ marks, including UK marks. Those were dealt with by a Settlement Agreement of 7 September 2000, made between inter alia Balfour Beatty (the new name of BICC Plc from 10 May 2000), GK Technologies Inc and GCC (“trading as BICC General”), by which Balfour Beatty agreed to transfer to BICC General and its subsidiaries a number of BICC trade marks and applications and agreed not to use the BICC name, subject to some exceptions. The exceptions did not permit Balfour Beatty to use BICC in connection with the cables industry in the UK.

The trade marks listed in the Settlement Agreement and transferred by Balfour Beatty included at least two BICC UK registered marks (Nos. 779192 and 1538959) which were registered for cables, etc in Class 9, and another (No. 783638) which was registered for cleats, etc for use in connection with cables and other metal goods in Class 6. All of these registrations have long since expired.

So, if the Claimant is right in saying that the goodwill in the name BICC attaching to the original cables business was transferred to GK Technologies Inc or GCC in 1999, and such goodwill was transferred to Pirelli in February 2000 or perhaps August 2000 when completion took place, at all times from 1999 onwards the registered trade mark rights in BICC in relation to cables etc were held separately to the goodwill. That was the case between completion of the GK Technologies Agreement and the making of the Settlement Agreement, and, so far as the evidence before me shows, remained the case after the Settlement Agreement. Prior to the Settlement Agreement, GCC had agreed to transfer its interests in the cables business to Pirelli. That sale appears to have completed just before the Settlement Agreement. However, there is no evidence that GCC assigned any of the UK marks which it acquired at that time to Pirelli, nor was that the Claimant’s pleaded case. It is common ground that those marks were never assigned to Pirelli.

The effect of Clause 18.5 of the GK Technologies Agreement was to grant limited rights to the Purchaser (not to any “Relevant Purchaser”) and its subsidiaries to use the BICC name. That seems consistent with the retention of the BICC trade marks by BICC Plc at that date. In my judgment, it is difficult to reconcile that clause with the Claimant’s contention that goodwill in the BICC brand was one of the assets purchased in 1999, especially as the subsequent transfer of the marks to GCC seems not to have been made for Pirelli’s benefit, despite both transactions taking place close together in 2000. Furthermore, to the extent that the Purchaser/GCC was granted a licence to use the BICC name by Clause 18.5 (as amended), the licence was circumscribed by the requirement that the licensee should be and remain a member of the Purchasers’ group. Any licence to GCC would have ceased upon the share sale to Pirelli.

Certainly some goodwill was assigned by the Agreement. That is clear on its face. In my judgment two points militate against an assignment of the relevant goodwill. First, the terms of clause 18.5.2 are hard to reconcile with such an assignment, for if the goodwill in the BICC brand had been assigned, that clause would not have been needed, as the Purchaser would have had all the rights it needed to use the BICC name, whether as BICC General or otherwise. Secondly, if the goodwill in BICC was transferred to the Purchaser it is very odd that the registered trade marks for BICC which relate to the cables business (as opposed to the BICC marks for wider construction services etc always intended to be retained by Balfour Beatty) were not also assigned to it. Undoubtedly there was a reason for that in 1999, which may relate to the retention of part of the business by Balfour Beatty, or some geographical differentiation (as it seems that GCC got the right to use the BICC name in North America) but that is unclear at this remove.

The Claimant did not suggest that the Pirelli Agreement dealt with the transfer of goodwill (if any), which presumably would have been unnecessary in a share transfer agreement, but I note that there was a provision in Clause 12.2 for the transfer at “Closing” of intellectual property rights owned by the group companies at that date. There was no evidence before the Court that any additional transfer of goodwill was made. On the contrary, the Defendants relied upon a letter from Mr Robert Siverd, the Executive Vice President and General Counsel of BICC General to Mr Oscar Boschetti, the chief legal officer of Pirelli Cavi E Sistemi SpA, dated 8 November 2000, that is only a few months after completion of the Pirelli Agreement. Mr Siverd wrote:

“Re: use of “BICC” name

Dear Oscar

I am writing to bring to your attention a situation which we would like Pirelli to address under the Share Purchase Agreement (the "Agreement"). We have learned that personnel at some of the companies you purchased in the UK and Asia are using the name "BICC" … in answering telephones at their offices. This use of the "BICC" name may lead to confusion in the marketplace and also is not permitted under the Agreement.

In Clause 9 of the Agreement, we agreed, in effect, that General Cable could continue to use the name "BICCGeneral" in North America, but would not do so outside North America. General Cable and Pirelli also agreed to change the names of their retained subsidiaries and the divested companies within fixed times in order to remove the "BICC" wording from those company names. … However, General Cable did not give Pirelli any general right to use the "BICC" name outside of America under the Agreement. The reason for this was simple: our specific rights to use the "BICC" and "BICCGeneral" names came from written contracts we had with BICC plc, now Balfour Beatty plc. BICC plc had the rights to the trademark and name for BICC and we did not grant Pirelli any more rights than we had from BICC. …

In addition, since the date of the Agreement, we at General Cable have resolved issues relating to adjustment of the purchase price with BICC. As part of that agreement, we acquired ownership of the BICC trademark and name worldwide, subject to some conditions. So General Cable has both contractual and intellectual property grounds for our position on the use of the name.

We ask that you take the necessary steps to stop using the "BICC" name at your facilities promptly. In addition, during the transition period after the closing, we believe it is important to clearly explain to customers. The change in ownership so they will not be confused in making decisions.” (my emphasis)

The Defendants submitted that this more or less contemporaneous letter showed very clearly that in 2000 GCC (by then using the name BICCGeneral) accepted and asserted to Pirelli that it had not acquired rights in the BICC trade marks or name from BICC plc in the 1999 Agreement and could not have and did not pass on any such rights to Pirelli. Mr Siverd as BICCGeneral’s in-house lawyer would have been well qualified to comment on the effect of the Agreements.

Both Dr Spiller and Mr Clarke’s evidence was that whilst working for GCC/Pirelli in 2000 they understood that Pirelli was obliged to stop using the BICC name, hence the change to using the mark BICON after the take-over from GCC. Dr Spiller accepted that the BICC marks were not passed to Pirelli, and that it was obliged to cease using the name. In my view that is consistent with his evidence that the BICON name was chosen to maintain a link to the historic BICC name. Mr Montgomery mentioned that BICC Plc had made some use of the sign BICCON (for BICC Connect) in the 1980s. The Claimant did not plead this point, or advance any further evidence about this, and it does not seem to me that I may find that would have enhanced the link from BICC to BICON. Had Pirelli acquired goodwill in the BICC name, the change to BICON would (as Mr Clarke suggested) have made no commercial sense.

Counsel for the Claimant invited me not to rely upon Dr Spiller’s frank acceptance in his oral evidence that Pirelli had not acquired the BICC name but was obliged to stop using it. Of course, Dr Spiller is not a lawyer, and in 1999-2000 he was working as a research scientist for BICC/Pirelli. He could not be expected to have read or understood the hundreds of pages of chain of title documents. However, it seems to me that his evidence is of significance. He was able to give first hand evidence that Pirelli did change the name and that he believed that it felt obliged to do so. That evidence is wholly consistent with the contents of Mr Siverd’s letter of November 2000, and with Mr Clarke’s evidence about the changes in 2000.

Moreover, Dr Spiller's oral evidence was also wholly consistent with the letters which he sent out from 2015 onwards, when concerns were raised about the First Defendant's activities, in which he said that the BICC name was not part of the rights acquired by the Claimant and that the trade mark BICON was adopted in order to remain synonymous with BICC quality, etc.

Lastly, it seems to me that the fact that Pirelli/the Claimant never used the BICC Mark, but chose to adopt the BICON mark in 2000, shows that at that time, when the extent of the rights which it had acquired would have been fresh in everybody's minds, Pirelli did not believe it had the right to use the BICC mark. The best it could do was to adopt a mark which it hoped would link to the heritage of the BICC mark. The Claimant has never traded using the BICC name as an indicator of origin for its products.

For these reasons, I conclude that the goodwill in the BICC Mark was never transferred to Pirelli/the Claimant. The Claimant does not claim to have used the mark at any point since 2000 so as to build up its own goodwill. On that basis, the claim for passing off must fail.