Trade mark litigation between Specsavers and Asda comes to an end

The Court of Appeal has found that the extensive use by Specsavers of its green, shaded trade mark is enough to constitute genuine use of its wordless mark.

Re-cap of the case so far

The dispute between Specsavers and Asda stems from Asda's aggressive marketing strategy for its in-store optician service. The Asda campaign included the use of similar logos to those used by competitor Specsavers and straplines including "Be a real spec saver at Asda". In response, Specsavers brought proceedings against Asda both for trade mark infringement and passing off.

At first instance in 2010, the High Court held that Specsavers succeeded in respect of the above strapline as it took unfair advantage of the distinctive character or repute of the trade marks. However, the court rejected the claim that Asda had infringed Specsavers' device mark and its claim for passing off. The court also held that Specsavers' Wordless mark should be revoked for non-use. Specsavers appealed against these findings.

In 2012, the Court of Appeal largely found in favour of Specsavers. It allowed the appeal in respect of the allegation that the Asda logo and its strapline "Spec savings at Asda" infringed Specsavers' word mark and its Shaded and Wordless logo marks.

However, the Court of Appeal stayed Specsavers' appeal against revocation of the Wordless mark to seek guidance from the Court of Justice of the European Union (CJEU). The CJEU judgment and subsequent Court of Appeal findings as to the Wordless logo mark are the subject of this article.

Background to the Wordless mark dispute

On 15 October 2014, the Court of Appeal gave its judgment on the sole issue of whether Specsavers' Wordless mark, below left, should be revoked for non-use or whether use of its Shaded mark, below right, was enough to constitute genuine use of the Wordless mark.

Specsavers had registered the two logos below as trade marks. Asda had sought to revoke Specsavers' Wordless mark (Community Trade Mark (CTM) No 1358589) on the ground of non-use under Article 51(1)(a) of Council Regulation (EC) No 207/2009/EC (the "Regulation"). This provides that if within five years following registration of a CTM the proprietor has not put it to genuine use in connection with the registered goods or services, the mark will be revoked.

In response, Specsavers argued that its use of the Shaded mark constituted genuine use of the Wordless mark. Article 15(1)(a) of the Regulation provides that use of a CTM in a form differing in elements which do not alter the distinctive character of the mark in the form registered will constitute genuine use.

Differing views of the courts

At first instance in 2010, Mann J had found that to the average consumer the addition of the word 'Specsavers' altered the distinctive character of the Wordless logo mark. On that basis he held that use of the Wordless logo could not be relied upon.

Kitchin LJ, on appeal, recognised that the court needed to address two important issues:

1. the factual issue of whether the average consumer recognises the Wordless logo mark when he sees the Shaded logo mark; and
2. the legal issue of whether the use of the Shaded logo mark constitutes genuine use of the Wordless logo mark.

The Court of Appeal sought assistance from the CJEU on the legal issue of whether the use of a superimposed word mark over a graphical logo could amount to genuine use of the CTM.

In 2013, the CJEU held that genuine use under the Regulation can be fulfilled in these circumstances:

"to the extent that the differences between the form in which the mark has been used and that in which it is registered do not change the distinctive character of that trade mark as registered".

Following this judgment, the parties settled their dispute on trade mark infringement of Specsavers' word mark and logos on confidential terms. Specsavers did, however, pursue its appeal of the High Court's decision to revoke the Wordless mark.

Therefore in its 2014 judgment, the Court of Appeal addressed two key issues:

1. whether the use that had been made by Specsavers of the Wordless mark was genuine use, such that the Wordless mark serves to identify the goods and services of Specsavers; and
2. whether the differences between the form of the Wordless mark as registered and its use changed the distinctive character of the mark.

The Court of Appeal's decision

Specsavers succeeded in its Appeal, which was uncontested by Asda, but in which the Registrar of Trade Marks intervened. Notably, the court pointed to the following crucial factors:

1. Specsavers had made substantial use of the Shaded mark since around 1995 and it had featured heavily in all aspects of the business, including interior and exterior signage, in-store materials and all aspects of advertising and marketing.
2. Both Specsavers' Wordless and Shaded marks were sufficiently different in design from any logo used by competitors. Specsavers was not attempting to secure a monopoly for a commonly used design - it had something that was genuinely different in the market place.
3. There was strong evidence to infer that Asda knew that it was the Wordless mark that denoted Specsavers. The court noted that the initial design of Asda's logo was effectively the Wordless mark and Asda had moved the elipses apart to 'a safe distance'. Internal comments on the initial designs for the logo included "Asda version of Specsavers - rip off", "highly recognisable" and "the Specsavers logo". The Court of Appeal held that this evidence showed that Asda had a clear understanding of the nature of the market, the characteristics of the average consumer and other matters affecting how the average consumer would react to the use of the logos. This, the court held, was "very persuasive evidence of how the Shaded logo mark is perceived".
4. Consumers recognise the green overlapping elipses on signage outside Specsavers' stores as denoting the business. The court agreed that, from a distance, the word "Specsavers" does not stand out and it is the shape of the mark that is recognisable. Notably, Specsavers registered the Wordless mark without any colour limitation (as distinct from a colour claim) and so although it appears black in the image above, it is regarded as registered in respect of all colours (Phones 4u Ltd v Phone4u.co.uk Internet Ltd [2006]). The court was satisfied that as consumers recognised the green overlapping elipses on signage this would amount to genuine use of the Wordless mark.

Notably, Kitchin LJ held that the evidence strongly showed that the Wordless mark served to identify the goods and services of Specsavers and that the average consumer has perceived the Wordless mark as indicative of the origin of the goods and services of Specsavers. He commented:

"the differences between the Shaded logo mark and the Wordless logo mark have not changed the distinctive character of the Wordless logo mark; and the Wordless logo mark has itself been seen as a trade mark and not simply as background."

Consequences

Although at first glance it might seem that this decision could pave the way for a deluge of registrations of relatively commonplace outline shapes as logo marks, Kitchin LJ expressly commented that each and every case must be decided on its own facts.

He further commented that it is unlikely that the background of a mark will be perceived by the average consumer as an indication of origin. Indeed, the resounding message from the Court of Appeal was that only in unusual cases such as this one, in which the evidence was so convincing, will a background logo (registered as a separate trade mark) be considered to be in genuine use when used as part of a composite mark.

In addition, the Court of Appeal noted the CJEU's judgment that it would potentially be relevant to the global appreciation analysis that a defendant itself was associated with the colour of the accused mark and this might reduce the likelihood of confusion or association.