Claim No: IP-2022-000066 - [2024] EWHC 1369 (IPEC)

I am with the Claimant on this issue. I note that the natural and ordinary meaning of the words “reasonable modifications” in the context of a licence being granted to KK to use the Settlement Sign “subject to reasonable modifications thereto”, is that KK as licensee may make modifications to the Settlement Sign but they must be reasonable when viewed through the eyes of the Claimant, acting reasonably, as the licensor. In my judgment, and taking into account that natural and ordinary meaning: in the context of this settlement agreement in which the parties sat down and produced a Settlement Sign which neither may have liked but both were prepared to compromise and live with in order to settle their trade mark dispute and get on with their businesses; where it is reasonable to assume that their focus was on the Settlement Sign and the wording of the definition of that sign; the reasonable person with all the background knowledge, including the knowledge of the Claimant’s previous history of trade mark disputes involving KK, would have understood the parties to be using “reasonable modifications” to mean modifications which did not increase the similarity of the Settlement Sign to the Morley’s Red and White Mark. It is also in accordance with commercial common sense, in my judgment. It would not make commercial common sense for KK as the licensee against whom allegations of trade mark infringement had been made, which the 2018 Agreement was intended to settle, to be permitted to make modifications to the Settlement Sign which undermined that settlement by bringing it closer in similarity to the mark alleged to have been infringed.

Given that construction, for the reasons I have given I am satisfied that each of: (i) the addition of the strapline; (ii) the removal of one edge of the border; (iii) the dulling of the colour of the border from electric blue to dark blue and (iv) the reduced spacing between the letters of “Metro’s” are not reasonable modifications, as each of them increases the similarity of the Settlement Sign to the Morley’s Red and White Mark. The electric blue border appears to be an intentional and specific agreement reached by the parties in order to distinguish the Settlement Sign from the Morley’s Red and White Mark and so anything which is done to undermine that distinction is not reasonable, in my judgment. A trivial change would not undermine that distinction, but I consider that the removal of the border on one of the long sides of the sign so it is no longer entirely ringed by a band of electric blue does undermine that distinction and cannot be viewed as trivial. Both that and the dulling of the colour of that border to a dark blue combine to undermine the visual distinction provided by the border of electric blue which was agreed as part of the process of agreeing the 2018 Agreement.

Accordingly, I find that Sign 1 does not fall within the definition of Metro’s Signs in the 2018 Agreement. It follows that KK has infringed the Morley’s Red and White Mark pursuant to section 10(2)(b) TMA by use of Sign 1. It follows that Issue 19 falls away.

Yes, as such breaches are set out at paragraph 22.2 of the Re-re-amended Particulars of Claim.

Yes, as such breaches are set out at paragraph 22.1 of the Re-re-amended Particulars of Claim.

Issues 22 and 23 relate to the Defendants’ case for invalidation of the Claimant’s Marks which is no longer pursued, and so I move to Issue 24.

Given my findings in relation to trade mark infringement, the Defendants’ counterclaim for breach of contract must fail, and so the answers to issues 24 and 25 are no.

I have already determined that the implied term sought by the Defendants should not be implied into the 2018 Agreement.

The following is a summary of the main determinations made in this judgment:

I will hear submissions on interest, costs, and any consequential orders at a hearing following the handing down of this judgment.