Brealey & Anor v Nomination De Antonio E Paolo Gensini SNC & Anor

The judge considered the law in relation to Article 13(2) at [49]-[55]. It is evident that he directed himself that the principle to be applied was that articulated by the CJEU in Case C-59/08 Copad SA v Christian Dior Couture SA [EU:C:2009:260] at [55]:

“… damage done to the reputation of a trade mark may, in principle, be a legitimate reason, within the meaning of art.7(2) of the Directive, allowing the proprietor of the mark to oppose further commercialisation of luxury goods which have been put on the market in the EEA by him or with his consent …”

Counsel for JSC did not take issue with this, and in particular did not suggest that anything turned on the possible distinction between the requirement for “damage” articulated by the CJEU in Copad and the requirement that the use in question

“seriously damages the reputation of the trade mark” which it had articulated in the earlier case of Case C-337/95 Parfums Christian Dior SA v Evora BV [1997] ECR I6013 at [48].

The judge’s assessment of this issue was as follows:

“45.

As I have said, JSC supplied Nomination base links to their customers either in a small blister pack or in a small transparent plastic bag. No one could say that JSC's packaging conveys an impression of quality.

46.

A potential difficulty for Nomination was the packaging sometimes used by their retailers for the sale of individual links. I was shown a Nomination base link in a transparent plastic bag as supplied by one of Nomination’s authorised retailers. However, a customer going to an authorised Nomination retailer to buy an extra base link has already bought or been given a Nomination bracelet. The image of quality has already been conveyed by the bracelet's packaging.

47.

JSC's customers may never have received a Nomination bracelet. In fact JSC's advertising promotes the idea of using a Nomination base link as an additional part of JSC's ‘Italian charm bracelet’. So far as packaging is concerned, these customers would associate Nomination's product only with either a small blister pack or a small plastic bag.

48.

[Counsel for JSC] pointed out that non-authorised traders other than JSC have supplied Nomination’s base links in simple packaging and Nomination have not sought to stop such sales. I agree that Nomination have been relaxed about policing its rights. But that does not neutralise the rights if they exist.

…

56.

… I must reach a view as to whether it is likely that JSC's packaging will damage the reputation of the Trade Marks and thereby Nomination. I think it is likely. I am satisfied that the

elegant packaging of Nomination’s bracelets will convey an image of luxury to purchasers and that this increases the reputation of the Trade Marks. The receipt of Nomination’s products in a small blister pack or polythene bag is likely to damage that reputation.”

Before turning to the principal criticisms which JSC makes of the judge’s assessment, it is convenient first to deal with two more minor points. Counsel for JSC pointed out that the CJEU had gone on in Copad to hold at [59] that the trade mark proprietor could oppose the resale of goods “only if it can be established that, taking into the particular circumstances of the case, such resale damages the reputation of the trade mark [emphasis added]”. He submitted that, first, the burden of proof lay on the trade mark proprietor in this respect, and secondly, damage to reputation must be established. I am content to assume that both submissions are correct, but this does not assist JSC.

So far as the first point is concerned, there was debate before the judge as to whether there was an initial burden on JSC to show that the packaging was not liable to damage the reputation of the Trade Marks (as suggested by Case C-348/04 Boehringer Ingelheim KG v Swingward Ltd [EU:C:2007:249]), but as can be seen the judge simply asked himself whether it was likely that the packaging would damage their reputation. Turning to the second point, as counsel accepted, English procedural law takes facts as established if they are more likely than not, and the judge concluded that damage to the reputation of the Trade Marks was likely.

I turn therefore to consider JSC’s principal criticisms of the judge’s assessment. The first of these is that the judge failed to take into account evidence showing that Nomination bracelets were not always sold in the “luxury” packaging described above. Mr Brealey gave evidence in paragraphs 30-31 of his first witness statement that on 16 November 2018 JSC’s solicitor had purchased a Nomination base bracelet costing £11.90 from the online retailer Amazon SARL which had arrived wrapped in a clear plastic sleeve inside a clear grip-seal plastic bag and without any “luxury” packaging. Both the sleeve and the bag bore the Nomination brand name in black print.

It is correct that the judge did not refer to this evidence in his judgment. In my judgment, however, it does not undermine his assessment. In the first place, it postdates the relevant period. Secondly, the evidence does not reveal where Amazon SARL sourced the bracelet from. Thus it does not show that the source was either Nomination or an authorised retailer. Mr Brealey assumed that it came from Nomination or an authorised retailer because the sleeve and bag were branded Nomination, but this does not necessarily follow. Thirdly, there is no evidence as to the frequency of such sales. Fourthly, as discussed above, Nomination primarily sell their products through bricks-and-mortar retailers. This evidence does not detract from the judge’s finding that consumers who had bought bracelets from such retailers, or received as gifts bracelets purchased by others from such retailers, would have been exposed to the “luxury” packaging.

JSC’s second main criticism is based on the judge’s findings in [46]. The judge found that Nomination’s authorised retailers “sometimes” sold individual Nomination links in transparent plastic bags. Counsel for JSC took us to the sole example of this in evidence, which is a photograph showing a single charm link purchased by JSC in 2016 from an authorised retailer called Argento that arrived in what appears to be a clear grip-seal plastic bag. Counsel for JSC submitted there was no evidential foundation for the finding that this only happened “sometimes”, but that is an impossible submission to accept when counsel was unable to cite any evidence as to the frequency of such sales. The mere fact that Nomination’s case was that it did not consent to the sale of individual base links is not enough to show that such links were commonly sold in plastic bags.

More importantly, counsel for JSC submitted that, if, as he submitted that the judge had found at [46], the reputation of the Trade Marks was not damaged when consumers who had bought Nomination bracelets in “luxury packaging” from authorised retailers then purchased individual Nomination links in plastic bags, there was no basis for concluding that the position would be any different when such consumers purchased Bundles containing Nomination links in blister packs or plastic bags from JSC.

As Patten LJ pointed out in the course of argument, it appears from what the judge said at [47] that the judge’s answer to this point was that JSC’s customers might never have purchased or received a Nomination bracelet. Counsel for JSC submitted that, if so, the judge had fallen into error because, up to that point, the judge had rightly been focussing upon the reputation of the Trade Marks amongst consumers who had purchased Nomination bracelets.

Counsel for Nomination disputed that the judge had found in [46] that the reputation of the Trade Marks was not damaged when consumers who had bought Nomination bracelets in “luxury packaging” from authorised retailers then purchased individual Nomination links in plastic bags. He submitted that this was damaging to the reputation of the Trade Marks, but the judge had found that it only happened “sometimes”, and that this did not justify JSC inflicting further damage on the reputation of the Trade Marks by its sales of the Bundles on an apparently substantial scale over a five year period.

I would add that, in the case of consumers who had never purchased or received a Nomination bracelet, the point I understand the judge to have been making at [47] was that Nomination had been deprived of the opportunity of conveying its desired luxury image to them, and in that sense the reputation of the Trade Marks had been damaged. (The same would be true of the base bracelet sold by Amazon SARL, but the other caveats noted in paragraph 28 above apply to that. In any event, it could be argued that the same reasoning would apply, namely that it would not justify JSC inflicting further damage on the reputation of the Trade Marks.)

While I see some force in JSC’s criticisms of the judge’s reasoning, the question is whether this Court would be justified in substituting its own evaluation of the issue for that of the judge, particularly in the circumstances identified in paragraph 4 above. In my judgment, it would not. For the reasons given in paragraphs 32 and 33 above, I consider that it was open to the judge to conclude that sales of Nomination links by

I am bound to say that I have some difficulty with the way Nomination’s second complaint of trade mark infringement was argued by the parties below, and therefore analysed by the judge. Nomination advanced its case under Article 9(1)(a), and it was agreed between the parties that Nomination’s pleaded allegations of infringement under Article 9(1)(b) and (c) added nothing. The sole issue between the parties under Article 9(1)(a) was whether JSC had used the sign “in relation to” JSC’s own links i.e. condition (v)(a).

As the judge correctly identified at [78], the test laid down by the CJEU with respect to condition (v)(a) is whether the use of the sign is “for the purpose of distinguishing the goods or services in question”, that is to say, as a trade mark (see Case C-63/97 Bayerische Motorenwerke AG v Deenik [1999] ECR I-905 at [38], Case C-245/02 Anheuser-Busch Inc v Budejovicky Budvar np [2004] ECR I-10989 at [64], and Case C-17/06 Céline SARL v Céline SA [2007] ECR I-7041 at [20]). Part of the point of this test is that, if the sign is used for the purpose of distinguishing non-genuine goods, then a likelihood of confusion may safely be (rebuttably) presumed (in accordance with Article 16(1) of TRIPS). (It is not necessary for these purposes to consider the position if the goods are genuine.) Thus the logic is that use of the identical sign “in relation to” non-genuine identical goods implies a likelihood of confusion.

Nomination’s case before the judge involved reversing this logic. Nomination argued that there was a likelihood of confusion (and indeed actual confusion), and therefore there was use of the sign “in relation to” goods. JSC did not take issue with this logic (instead they argued that there was no likelihood of confusion). But I wonder if it necessarily follows, and in particular whether a likelihood of confusion means that the sign has been used “in relation to” all the relevant goods. In any event, it seems to me that, given that Nomination were positively asserting a likelihood of confusion, their case would have been better analysed under Article 9(1)(b).

This problem is compounded by the fact that the parties treated the passing off claim as raising the same issue when, to my mind, it did not. Rather, the passing off claim ran parallel to the pleaded Article 9(1)(b) claim.

Fortunately, it is not necessary to try to untangle this knot, because the judge found that JSC was liable for passing off. Unless JSC can overturn that conclusion, it does not matter whether the judge’s analysis of the trade mark claim was soundly based.

There was no dispute at trial that Nomination owned considerable goodwill in the NOMINATION name. The issues were whether JSC’s use of the name constituted a misrepresentation and, if so, whether it had caused damage to Nomination. The judge found that JSC’s use of the name in advertisements exemplified by the Listing had led

There is no dispute that, if the judge was entitled to find that there had been a

As counsel for JSC submitted, the judge’s conclusion rested upon two foundations. The first was his interpretation of the Listing at [67]:

“A typical reader of this and other online advertisements from JSC would reasonably have priorities other than pondering in depth which link is made by whom. However, I think a reasonable reader would have received a blurred message about the manufacturing source of the two bundled links and might have formed the impression that both are made for JSC, one of them being styled ‘Nomination’.”

Counsel for JSC submitted that it was clear from the Listing that the Bundles comprised a JSC link and a Nomination link. In support of this submission, he relied in particular upon various features of the Listing which the judge had not quoted, such as the information about the seller being based in the UK. I am not persuaded by this submission. As counsel for JSC himself pointed out, the Listing is for a very inexpensive item. In those circumstances the judge was entitled to conclude that it would not be read with great care and attention. Moreover, the fact remains that what JSC were doing was selling a bundle of two links from different trade sources. They therefore took the risk that, if they did not make the different sources of the two links crystal clear, some consumers would be confused.

The second foundation consisted of a letter from Natalie Hall of Xen Jewellery Design Ltd, an authorised Nomination retailer, to Kenneth Brown of Nomination dated 8 March 2016 and an email from Dale Gamble of J&D Duo Jewellery, another authorised Nomination retailer, to Mr Brown dated 9 March 2016 which the judge found at [68]-[76] evidenced actual confusion amongst purchasers of the Bundles as to the source of the JSC charm links. Counsel for JSC submitted that the judge was wrong to place weight upon this evidence because (i) as Mr Brown admitted, the communications had been prompted by him, (ii) the communications were hearsay evidence unsupported by statements of truth and untested in cross-examination and (iii) in the case of Mr Gamble’s email it was headed “without prejudice”.

The judge addressed points (i) and (iii) in his judgment. He did not consider that either point undermined the truth of the contents of the communications, and in my judgment he was clearly entitled to take that view. He did not explicitly address point (ii), but plainly he was aware of it. As he would also have been aware, Nomination had notified JSC of their intention to rely upon the communications well before trial, and if JSC had had reason to believe that the communications were untrue, they could have applied for the authors of them to be cross-examined pursuant to CPR rule 33.4. JSC did not do so. In those circumstances the weight to be attached to the communications was a matter for the judge. Furthermore, I consider that he was entitled to conclude that they evidenced actual confusion on the part of purchasers of Bundles and that such confusion stemmed from the use of the NOMINATION name in advertisements such as the Listing.

Accordingly, in my judgment, the judge was entitled to find that JSC’s use of the NOMINATION name in the Listing and similar advertisements had led to a

For the reasons given above, I would dismiss this appeal.