esure Insurance Ltd v Direct Line Insurance Plc

The next case in the chronology, Vedial SA v OHIM, France Distribution Case C-106/03 P of October 2004 reported in the ECJ at [2005] ETMR Pt 2 p.232, requires more detailed attention. Vedial had obtained French registration of the mark “Saint-Hubert 41” for Class 29 goods, butters, edible fats and dairy products. France Distribution applied to register as a Community trade mark in, inter alia, Class 29, a mark consisting of the word “Hubert” in a prominent style of lettering capped with a drawing of a jovial chef in a chef’s cap with his thumb held up in the air. The report does not indicate how Vedial’s mark Saint-Hubert 41 was registered or was commonly used; it seems it was a simple word-mark. A tortuous series of decisions led to a judgment in the ECJ which upheld the decision of 12^th December 2002 of the Court of First Instance – Case T-110/01. The CFI, applying, inter alia, Lloyd Schuhfabrik Meyer, supra,found it necessary to compare the rival signs from the visual, aural and conceptual points of view – CFI, para 48. The CFI rejected – para 51 – an argument that in principle a figurative mark such as the one with the picture of the chef could not display any visual similarity to a mere word mark, such as Vedial’s. The CFI accordingly turned to examine each of the three elements of the rival marks or signs, the visual, the aural and the conceptual. So far as concerned the visual element, the CFI held that the overall visual impression conveyed by the earlier mark was different from that conveyed by the mark claimed. Consequently it held that the dissimilarities between the conflicting signs were sufficient for it to be held that they were not similar visually – para 54. It so concluded notwithstanding, of course, that the rivals each contained the word “Hubert”. The CFI then compared the aural stresses inherent in French in the words “Saint-Hubert” and the single word “Hubert”. It held that the marks were dissimilar from an aural point of view. So far as concerned conceptual similarity, it noted that, whereas Saint-Hubert was likely to evoke in the mind of the targeted public a saint of the catholic religion or the name of a place, the word Hubert, on its own, corresponded to a common Christian name. The CFI, rebutting conceptual similarity, said, at its para 58:

“… it is sufficient to observe that the targeted public will make distinctions between the ideas evoked by each sign.”

Taking the visual, aural and conceptual issues together, at its para 65 the CFI had held that the conflicting signs (with my emphasis) could not “in any way be regarded as identical or similar from the visual, aural or conceptual points of view, …”. Accordingly, one of the essential conditions of a bar to registration had not been satisfied. “It therefore follows” held the CFI next at its para 66, “that the Board of Appeal was right in finding that there is no likelihood of confusion between the mark claimed and the earlier mark”. As there had been no enquiry into confusion, it is difficult to see how that last sentence could be justified unless one remembers that the “likelihood of confusion” being there referred to was the kind of likelihood spoken of in 4(1)(b), namely one arising “because of” the similarity. A plainer and more logical approach (because the CFI, as I say, did not in fact look into the likelihood or not of confusion) would have been to say that because there was no relevant similarity there could not be any relevant confusion and hence that no need to examine whether some confusion had been caused had ever arisen. In any event, the CFI dismissed Vedial’s objection.

In the judgment of the ECJ at paras 53 and 54 one finds that Court’s conclusion as follows, with my emphasis:

“After making a comparative study, at [48] to [59] of the judgment under appeal, of the two marks in the visual, aural and conceptual senses, the Court of First Instance concluded, as stated at [65] of the judgment, that the marks could in no way be regarded as identical or similar for the purposes of Art 8(1)(b) of Regulation No 40/94.

Having found that there was no similarity between the earlier mark and the mark applied for, the Court of First Instance correctly concluded that there was no likelihood of confusion, whatever the reputation of the earlier mark and regardless of the degree of identity or similarity of the goods or services concerned.”

Inescapably there were items common to Vedial’s word mark and France Distribution’s mark with the genial chef. In each of them the letters H-U-B-E-R-T appear and appear, moreover, in the very same order. Again, aurally, there were similarities between the way the two marks would sound. Yet it was held that there was no similarity at all; the marks could “in no way” be regarded as similar. In my judgment, Vedial does point towards there being a threshold below which there is no 4(1)(b) similarity, irrespective of there being items, indeed several items, common to both marks.

It cannot be, consistently with Vedial, that any similarity between aspects or items of the rival marks which can be identified leads to a need to go on to consider whether the required likelihood of confusion has been demonstrated (or is to be assumed or can fairly be inferred) and if it has been, whether it has been caused by the similarity. There is, it would seem from Vedial, some threshold such that once the required overall appreciation has been made, consistently with the autonomous concept of similarity to which I have referred, and has proved negative, then any aspects or items of similarity are left inconsequential as they are effectively displaced by the negative overall appreciation. Moreover, if some such threshold is not equalled or exceeded then one can thereafter, for the purposes of 4(1)(b), properly speak of the marks as being “in no way” similar.

Mr Hobbs resists this reading of Vedial. There is, he says, no threshold at all; it suffices, in order to require the likelihood or not of confusion to be examined, that there is any item or aspect of the marks that is similar. Only if the signs are completely different is it possible to take the view in principle that there is no likelihood of confusion; even a slight similarity requires that likelihood to be examined. If Vedial says otherwise,he adds, that is explicable by reference to its procedural history. I do not accept that; the language used by the ECJ does not appear to have been constrained by the procedural history of the case and the notion that any item or aspect of similarity suffices flies in the face not only of the conclusion reached in Vedial but with the notion that 4(1)(b) similarity is a concept, as I have mentioned, ultimately based not on minute analysis of the items and aspects of the rival marks but one determined by way of a global appreciation, the overall impression given by the marks, bearing in mind, in particular, their distinctive and dominant components but having regard also to the interdependence principle and the other factors to which I have already referred. Indeed, unless there were to be some threshold which has to be equalled or exceeded, then, as, in practical terms, no one, surely, would embark on a contest were there to be not even a single aspect of the rival marks that was similar and if, therefore, in any contested case, even an insignificant and minor item or aspect of similarity inescapably led to the need to examine whether there was the appropriate likelihood of confusion, one would, in practical terms, have repealed such language of 4(1)(b) as requires both similarity and the causal link to which I have referred; one would in every contested case go straight to an examination of the likelihood of confusion. I shall need to return below to the “threshold” argument at later stages in this chronological approach to the authorities which were laid before me.

Home-Tek International’s Applications – BL 0-144-05, 20^th May 2005 was a domestic decision in which the experienced Appointed Person at his para 26 said:-

“There is “similarity” to be assessed under Article 4(1)(b) when there are elements of visual, aural or conceptual resemblance that may enable the later mark to exploit the distinctiveness of the earlier mark”.

Taken out of context, that may be said insufficiently to separate the existence of similarity on the one hand and its possible effects on the other but, leaving that aside, the sentence does suggest that there is a threshold to be equalled or surpassed. The threshold there described is that the similarity needs to be such as may enable the later mark to exploit the distinctiveness of the earlier mark but the Appointed Person does appear to recognise that there is some threshold.

Next in time of the authorities to which I was referred is Muehlens GmbH & Co KG v Office for Harmonisation in the Internal Market (Trade Marks and Designs) (OHIM) [2006] ECR I-2717 and to the opinion of Advocate-General Ruiz-Jarabo Colomer. I was not taken to any judgment of the Court. The German Court’s decision had rejected the CFI’s thesis that the degree of phonetic similarity between the two trade marks had been so insignificant that it would not give rise to any likelihood of confusion, since the degree of identity of the marks was not sufficiently great – para 75 of the Advocate-General’s opinion. The German Court’s knuckles were severely rapped by the Advocate-General who, at his para 78, described the German Court’s decision as a dysfunction of a kind such that it was necessary to bring it to an end not just in that case but in order to facilitate harmonious development of economic activity in the Community as a whole. Consistently with the CFI’s decision, which I have not seen, there must have been a threshold below which such similarity – phonetic - as could be asserted was so insignificant that it either could not or would not give rise to any likelihood of confusion. That may be thought to give rise to a mingling of the initially separate concepts of similarity on the one hand and likelihood of confusion on the other but some form of threshold can be seen to remain to be the case even when there is that mingling.

Next there is Soffass SpA v OHIM, Sodipan SCA intervening, a decision of 23^rd November 2005 by the CFI reported at [2006] ETMR 542. It was a contest between a figurative mark containing the word “NICKY” and another containing the word “NOKY”. Of the five letters in the former, three are to be found in the same order in the latter and there is some degree of aural similarity. The CFI, having referred itself to Vedial, next continued at its para 27:

“Therefore, if the signs are completely different it is possible in principle, without examining the goods in question, to take the view that there is no likelihood of confusion”.

In Picasso and Others v OHIM and DaimlerChrysler AG the judgment of the ECJ of 12^th January 2006, adopting the Sabel supra requirement that there should be a global appreciation of the visual, aural or conceptual similarities of the marks in question, emphasised, at its para 20, that, in the course of such a global appreciation, conceptual differences observed between the signs might counteract the visual and phonetic similarities between them.

L’Oreal SA v OHIM, Revlon (Switzerland) SAintervening, is case C-235/05 P in which the ECJ’s judgment was published on 27^th April 2006. The case is more concerned with the likelihood of confusion than it is with the concept of similarity but at its para 40 the ECJ’s judgment describes the Lloyd Schuhfabrik Meyer supra approach to similarity as settled case law. Mr Silverleaf, drawing attention to paragraphs 31 and 32, in particular, of L’Oreal, argues that the Hearing Officer fell into error; he gave undue influence, says Mr Silverleaf, to the perceived distinctive character of the telephone on wheels. Paragraph 31 of the Report in L’Oreal emphasises that, so far as concerns the assessment of similarity, what must be concentrated on is the perception of the relevant public. Paragraph 32, speaking of a complex mark, observes that the extent of the distinctiveness of an element of a complex mark will be a guiding factor in determining whether such distinctiveness will dominate the overall impression conveyed by that mark, irrespective of the assessment of the similarity of the two signs. The observations contained in paragraphs 31 and 32 are, in fact, under the heading “Argument of the Parties” but nonetheless seem to represent observations of the Court itself. When, under the heading “Findings of the Court”, the Court summarised the proper approach in paragraphs 40 and 41, it twice referred to Lloyd Schuhfabrik Meyer supra and adopted its reasoning. In paragraph 42 the Court said:

“It follows that the distinctive character of the earlier mark cannot have the significance which the applicant argues it should be given in the comparison of the signs in question, as it is not a factor which influences the perception which the consumer has of the similarity of the signs.”

Nike International Ltd v Fina Calzados, S.L is a decision of the Second Board of Appeal of 19^th May 2006 in Case R 301/2005-2. It is chiefly concerned with other aspects of trade marks but at its paragraph 33 the point is made that, in relation to particular goods, it can be that the public is more than usually “brand conscious” and therefore relatively attentive. To that extent the overall assessment can be affected by whether the goods or services in question are of a kind in which an unusually high degree of “brand consciousness” is to be found.

L’Oreal SA v Bellure NV [2007] ETMR 1 is a decision of Lewison J. of 4^th October 2006. The case requires particular attention because it appears to deal with the question of whether there is some minimum threshold of similarity required, a question which, as I have mentioned, is arguably bound up with one of the errors of principle which esure asserts is to be found in the Hearing Officer’s decision in this case. At his paragraph 110 Lewison J. said:

“Mr Wyand submitted that there was a threshold degree of similarity which had to be crossed before the court would consider whether the extent of similarity could have either of the effects required by s.10(2) and s.10(3) respectively. I do not agree. In my judgment similarity is a relative concept. A sign can be more or less similar to a mark…. Whether something is relevantly similar to another thing seems to me to depend on why you are asking the question. In the case of trade mark infringement the question is asked in order to determine whether the degree of similarity has had (or would have) a particular effect. In my judgment this is borne out by the ruling of the ECJ that a lower degree of similarity between the mark and the sign may be counterbalanced by a greater similarity between the goods to which the mark and the sign are respectively applied. Accordingly, in my judgment, there is no minimum threshold of the kind for which Mr Wyand contended. It is a question of degree in every case.”

Lewison J’s judgment does not itself specify what kind of minimum threshold Mr Wyand QC had contended for but I have been given a copy of the very full Skeleton Argument which Mr Wyand and his junior, Mr Moody-Stuart, deployed before Lewison J.. At para 29 the Skeleton Argument makes the point that “absent at least similarity there can be no infringement”. The argument continues:-

“This is a threshold test and is to be considered in each case by a visual, aural and conceptual comparison of the mark and sign”.

Although that is not a complete specification of the test for the relevant 4(1)(b) similarity – it leaves out, inter alia, the concept of interdependence – it is hard to fault it as far as it goes. If all that Mr Wyand was arguing for was that there had to be at least some similarity, I would not think that Lewison J. was intending to reject that argument. Nor does the fact that the question is one of degree of itself exclude there being a threshold. I notice, too, that, so far as one can tell from the report, Vedial supra was not referred to the Judge. But Lewison J’s observation that whether “something is relevantly similar to another thing must depend on why you are asking the question” is, as it seems to me, irresistible. “Are they similar”, asked of marks, would be almost bound to meet the response “For what purpose?”

That is not to say that in every case where some one or more items or aspects, howsoever insignificant, of the rival marks can be said to be similar, the fact-finding body necessarily has to go on to examine into the existence or not of a likelihood of confusion because that would obviate the necessity for an overall impression being formed of the rival marks in the relevant surrounding circumstances and for those overall impressions then to be compared. There can be cases – see e.g. Vedial and Soffass supra - where the fact-finding body, deploying the proper approach to the overall assessment which the authorities require and having due regard for interdependence and the other relevant surrounding circumstances, is able to conclude that notwithstanding some aspects of similarity, no likelihood of confusion could have been created. But, although I am far from sure I am here differing in any material way from Lewison J, I would hold there to be some form of threshold, albeit a low one. In a case such as the one before me, the threshold, in my judgment, is arrived at as follows. First, overall impressions of the rival marks are formed, paying full regard to all the requirements of the autonomous concept of 4(1)(b) similarity. Next one has to have in mind the types of confusion which are then relevant, namely (as I shall come on to below) those identified in Sabel supra at its para 16. Then the threshold question arises: are those overall impressions such that one can reasonably say that a likelihood of confusion could not thereby be created?

What types of confusion are such that their likelihood is material? The Directive itself requires only that the confusion should be “on the part of the public” and that its forms include “the likelihood of association with the earlier mark”. I shall, for the moment, leave aside the likelihood of association. The tenth recital to the Directive mentions that the appreciation of the likelihood of confusion depends on numerous elements and, in particular, on the recognition of the trade mark in the market, but relevant confusion has been divided into classes – see Sabel supra at para 16 – where, in relation to arguments as to the likelihood of association, the Benelux governments had in argument divided confusion into three classes. The ECJ in terms neither adopted nor rejected that classification but plainly, without intending that such classification should be exclusive, one can discern a difference between the confusion where the public confuses the sign and the mark in question, spoken of in Sabel as a likelihood of “direct confusion” and where the public makes a connection between the proprietors of the sign and those of the mark and confuses them, spoken of as a likelihood of “indirect confusion”. Narrower or wider classes might emerge but, for the moment, it suffices that confusion should be taken at least to include that form of direct and that form of indirect confusion.

The ECJ in Sabel referred at its paragraph 22 to the tenth recital to the Directive, to which I have already referred, and then continued, so far as relates to the likelihood of confusion, as follows:-

“The wording of Article 4(1)(b) of the Directive - '... there exists a likelihood of confusion on the part of the public ...' - shows that the perception of marks in the mind of the average consumer of the type of goods or services in question plays a decisive role in the global appreciation of the likelihood of confusion. The average consumer normally perceives a mark as a whole and does not proceed to analyse its various details.”

At paragraph 24 the ECJ continued that the more distinctive the earlier mark the greater would be the likelihood of confusion:

“… It is therefore not impossible that the conceptual similarity resulting from the fact that two marks use images with analogous semantic content may give rise to a likelihood of confusion where the earlier mark has a particularly distinctive character, either per se or because of the reputation it enjoys with the public.

25.

However, in circumstances such as those in point in the main proceedings, where the earlier mark is not especially well known to the public and consists of an image with little imaginative content, the mere fact that the two marks are conceptually similar is not sufficient to give rise to a likelihood of confusion.

26.

The answer to the national court's question must therefore be that the criterion of 'likelihood of confusion which includes the likelihood of association with the earlier mark’ contained in Article 4(1)(b) of the Directive is to be interpreted as meaning that the mere association which the public might make between two trade marks as a result of their analogous semantic content is not in itself a sufficient ground for concluding that there is a likelihood of confusion within the meaning of that provision”.

The ECJ would seem thus to have adopted the opinion of Advocate-General Jacobs at I-6213 para 64(2) that:

“The registration of a mark cannot be opposed merely on the ground that, because the idea behind it and another mark is the same, there is the risk that the public will associate the two marks in the sense that one will simply bring the other to mind without a likelihood of confusion as described above”.

The answer given in the ECJ’s para 26 was related to the position, described in para 25, where the earlier mark is not especially well-known and has little imaginative content. Neither of those observations would be apt in the case of Direct Line’s telephone on wheels.

Lloyd Schuhfabrik supra brought out that the notion of interdependence to which I have referred in relation to similarity was appropriate also to the global appreciation of the likelihood of confusion. At paragraph 22 in the FSR Report the ECJ continued:

“It follows that, for the purposes of Article 5(1)(b) of the Directive, there may be a likelihood of confusion, notwithstanding a lesser degree of similarity between the trade marks, where the goods or services covered by them are very similar and the earlier mark is highly distinctive (see, to that effect, Canon, paragraph 19).

21.

In determining the distinctive character of a mark and, accordingly, in assessing whether it is highly distinctive, the national court must make an overall assessment of the greater or lesser capacity of the mark to identify the goods or services for which it has been registered as coming from a particular undertaking, and thus to distinguish those goods or services from those of other undertakings (see, to that effect, judgment of May 4, 1999 in Joined Cases C-108/97 and C-109/97 Windsurfing Chiemsee v Huber and Attenberger [1999] ECR I-0000, paragraph 49).

23.

In making that assessment, account should be taken, in particular, of the inherent characteristics of the mark, including the fact that it does or does not contain an element descriptive of the goods or services for which it has been registered; the market share held by the mark; how intensive, geographically widespread and long-standing use of the mark has been; the amount invested by the undertaking in promoting the mark; the proportion of the relevant section of the public which, because of the mark, identifies the goods or services as originating from a particular undertaking; and statements from chambers of commerce and industry or other trade and professional associations (see Windsurfing Chiemsee, paragraph 51).”

At its paragraph 26 the ECJ continued:

“In addition, the global appreciation of the likelihood of confusion must, as regards the visual, aural or conceptual similarity of the marks in question, be based on the overall impression created by them, bearing in mind, in particular, their distinctive and dominant components… The wording of Article 5(1)(b) of the Directive — ‘... there exists a likelihood of confusion on the part of the public ...’ — shows that the perception of marks in the mind of the average consumer of the category of goods or services in question plays a decisive role in the global appreciation of the likelihood of confusion. The average consumer normally perceives a mark as a whole and does not proceed to analyse its various details”.

For the purposes of that global appreciation, continued the ECJ in Lloyd Schuhfabrik:

“…the average consumer of the category of products concerned is deemed to be reasonably well-informed and reasonably observant and circumspect…. However, account should be taken of the fact that the average consumer only rarely has the chance to make a direct comparison between the different marks but must place his trust in the imperfect picture of them that he has kept in his mind. It should also be borne in mind that the average consumer's level of attention is likely to vary according to the category of goods or services in question”.

In Marca Mode supra the ECJ, at its para 39, referred to the particularly distinctive character of an earlier mark leading to an increase in the likelihood of confusion. It also brought out, at para 39, that a proven likelihood of association did not lead to a presumption of a likelihood of confusion. To that extent it was merely echoing Sabel but it continued:

“… the Court referred by implication to the assessment of evidence which the national court must undertake in each case pending before it. It did not excuse the national court from the necessary positive finding of the existence of a likelihood of confusion which constitutes the matter to be proved”.

Thus it emphasised the need for an assessment of the evidence by the National Court. One could not presume the existence of a likelihood of confusion simply because the high degree of distinctiveness of a mark led to a likelihood of 4(1)(b) association.

I do not understand Sihra’s Trade Mark Application to be a case that materially adds to the European cases already cited as to confusion, nor does Vedial SA supra.

In T.I.M.E Art supra the CFI had – see the judgment of the ECJ at para 13 – held, inter alia, as follows:

“It is true that, according to case-law, a conceptual difference between the marks at issue may be such as to counteract to a large extent the visual and aural similarities between those signs ([Case T-292/01 Phillips-Van Heusen v OHIM – Pash Textilvertrieb und Einzelhandel (BASS) [2003] ECR II-4335], paragraph 54). However, for there to be such a counteraction, at least one of the marks at issue must have, from the point of view of the relevant public, a clear and specific meaning so that the public is capable of grasping it immediately”.

Sigla is chiefly concerned with Article 4(4)(a) (and hence section 5(3)) and none of Antartica Srl, the “Loaded” case, NASDAQ or INTELMARK, supra, needed to add anything on the subject of 4(1)(b) likelihood of confusion. I therefore turn to the third main heading of law with which I am concerned, namely reputation, advantage and detriment.

As I mentioned earlier, the present sense of the Directive is best found in section 5(3) of the 1994 Act which provides:-

“ (3)  A trade mark which—

(a)

is identical with or similar to an earlier trade mark …

(b)

[…] ,

shall not be registered if, or to the extent that, the earlier trade mark has a reputation in the United Kingdom (or, in the case of a Community trade mark or international trade mark (EC), in the European Community) and the use of the later mark without due cause would take unfair advantage of, or be detrimental to, the distinctive character or the repute of the earlier trade mark.”

It has not been argued that the basic requirement of similarity between mark and sign in this subsection differs materially from that in Art 4(1)(b) so that, for immediate purposes, I need not add anything on the subject of similarity save a mutatis mutandis variation in the description of the threshold. Nor can it be doubted but that the Direct Line mark has a reputation in the United Kingdom. As for the words “without due cause”, they require no examination for present purposes.

What does require more study are the words “would take unfair advantage of … the distinctive character or the repute of the earlier trade mark” and the words “or be detrimental” to that distinctive character or repute. I have no need to go yet again through the whole sequence of the cases put before me. It suffices that I should start with the decision of Lewison J. in 2006 in O2 Holdings Ltd v Hutchison 3 G Ltd, supra [2006] RPC 699. At his paragraph 73 Lewison J., after a review of chiefly ECJ authorities and remarks as to distinctiveness, concluded:

“It is not necessary for the average consumer to be able to identify the goods or services as originating from a particular undertaking in the sense of being able to name the undertaking concerned. It is enough that the average consumer knows that some statement about trade origin or quality of goods or services is being made”.

The notion of “unfair advantage or detriment to the distinctive character of an earlier mark” is explained in case R308/2003-1 Mango Sport System Srl Socio Unico Mangone Antonio Vincenzo v Diknah Sl [2005] ETMR 5[19] in a passage which Lewison J. adopts in Bellure supra, as follows:

"As to unfair advantage, which is in issue here since that was the condition for the rejection of the mark applied for, that is taken when another undertaking exploits the distinctive character or repute of the earlier mark to the benefit of its own marketing efforts. In that situation that undertaking effectively uses the renowned mark as a vehicle for generating consumer interest in its own products. The advantage for the third party arises in the substantial saving on investment in promotion and publicity for its own goods, since it is able to "free ride" on that already undertaken by the earlier reputed mark. It is unfair since the reward for the costs of promoting, maintaining and enhancing a particular trade mark should belong to the owner of the earlier trade mark in question."

Lewison J. added, at para 144 in Bellure, a passage that I would respectfully adopt, as follows:

“The mere fact that one product has a free ride on another does not necessarily found liability. A supermarket cola may sell because of the taste for cola engendered by the promotion of Coca-Cola and Pepsi-Cola. Likewise a supermarket packet of cornflakes may sell because of the promotion of cornflakes by Kellogg. But if the respective marks and signs do not have the necessary degree of similarity, that kind of free riding is legally permissible. Thus it is the similarity between sign and mark, not similarity between products, which is the key”.

As for detriment, in Bellure supra Lewison J. at his para 145 adopted passages from Sigla at para 62 in the Board of Appeal which ran as follows:

“42.

Hence, once an image associated with a trade mark which has a reputation has been shown to exist, the fact that the contested sign is detrimental to this image, must still be demonstrated.

43.

It must, therefore, be shown that the trade mark is sullied or debased by its association with something unseemly. This may happen when the applied for trade mark, to which the mark with reputation may be associated, is used, on the one hand, in an unpleasant, obscene or degrading context or, on the other hand, in a context which is not inherently unpleasant but which proves to be incompatible with the trade mark's image. In all cases, there is a comparison which is injurious to the trade mark's image and what is known in English as dilution by tarnishment".

Lewison J. continued with a quotation from Adidas that tarnishment described the situation where:-

“…the goods for which the infringing sign is used appeal to the public's senses in such a way that the trade mark's power of attraction is affected".

That, as it seems to me, admits, as also do references in later authorities, as relevant forms of detriment, forms going well beyond debasement or sully by “association with something unseemly”. Lewison J. also referred to the type of detriment called “blurring” in his para 147 in Bellure. He concluded, and I respectfully adopt his conclusion at para 148, that:

“In other words, there must, in my judgment, be a causative link between the application of the sign and the tarnishing or blurring of the mark complained of”.

The ECJ requires, as a sine qua non of a finding of material unfair advantage or detriment, not only, as I read it, that causative link but a further one. Section 5(3), like the Directive, does not expressly require any particular link although a causative link of at least a “but for” kind corresponding to that to which Lewison J. referred – para 79 – is surely required by implication. In the SPA-FINDERS case in the CFI on 25^th May 2005, Case T-67/04, an absence of a necessary link was, unsurprisingly, found as between, on the one hand, a travel arrangement company, Spa-Finders Ltd, seeking to register “SPA –FINDERS” as to Class 16 printed papers and Class 39 travel agency services and, on the other, opposition from the owners of earlier marks “SPA” and “LES THERMES DE SPA” in relation to mineral waters, Class 3 laundry cleaning and cosmetic goods and the jumble of services described in Class 42. The CFI in “SPA-FINDERS” referred back to Adidas-Salomon AG v Fitnessworld supra where, at its paragraphs 29 and 30, the ECJ had spoken of a link, albeit not one involving confusion, made by the public between the mark and the sign and arising out of a certain degree of similarity between them, which was required to be tested for in the same “global” way as was Article 5(1) likelihood of confusion. That form of link thus established is what was described in SPA- FINDERS – para 41 – as an essential condition and it is, as it seems to me, a form which goes beyond and is additional to the need for a causative link between the use of the sign and the relevant unfair advantage or detriment. I shall later refer to this form of link, required if section 5(3) is to be satisfied, as “the Additional Link”.

At all events where the causative link and the Additional Link are not plain and obvious, they are, as the quotation from Sigla in the Board of Appeal indicates, required to be proven. The Sigla case as it was at the time when Lewison J. heard Bellure went to the CFI where, in the Court’s decision of 22^nd March 2007, there is further guidance on the application of the provisions found in Article 8(5) of Regulation No. 40/94 corresponding to Article 4(3) and to section 5(3). Thus at para 35 of the March 2007 judgment one finds:

“Consequently, Article 8(5) of Regulation No 40/94 ensures that a mark with a reputation is protected with regard to any application for an identical or similar mark which might adversely affect its image, even if the goods or services covered by the mark applied for are not similar to those for which the earlier mark with a reputation has been registered”.

In para 37 the CFI ruled:

“So far as concerns, first, detriment to the distinctive character of the earlier mark by the use without due cause of the mark applied for, that detriment can occur where the earlier mark is no longer capable of arousing immediate association with the goods for which it is registered and used (SPA-FINDERS, paragraph 34 above, paragraph 43). That risk thus refers to the “dilution” or “gradual whittling away” of the earlier mark through the dispersion of its identity and its hold upon the public mind (Opinion of Advocate-General Jacobs in Adidas-Salomon and Adidas-Benelux, paragraph 36 above, point 37)”.

There was further explanation in paragraphs 39 and 40:

“39.

As regards, secondly, detriment to the repute of the earlier mark by the use without due cause of the mark applied for, it must be pointed out that such detriment is made out where the goods or services covered by the mark applied for may appeal to the public senses in such a way that the earlier mark power of attraction is diminished (SPA-FINDERS, paragraph 34 above, paragraph 46). The risk of that detriment can, inter alia, occur where those goods or services have a characteristic or a quality which may have a negative influence on the image of an earlier mark with a reputation on account of its being identical or similar to the mark applied for.

40.

Lastly, the concept of the unfair advantage taken of the distinctive character or the repute of the earlier mark by the use without due cause of the mark applied for encompasses instances where there is clear exploitation and “free-riding on the coattails” of a famous mark or an attempt to trade upon its reputation (SPA-FINDERS, paragraph 34 above, paragraph 51). In other words, this concerns the risk that the image of the mark with a reputation or the characteristics which it projects are transferred to the goods covered by the mark applied for, with the result that the marketing of those goods is made easier by that association with the earlier mark with a reputation”.

At its para 43 the Court turned to the nature of the evidence which an opposing party, as proprietor of the earlier mark with the reputation, must put forward in support of the ground for opposition referred to in Article 8(5) of Regulation No. 40/94. Here proof is not necessarily to be limited to facts properly put forward in evidence in the sense that – see para 45 – the Court can have regard to facts which are well known in the sense of being likely to be known by anyone or which may be learned from generally accessible sources.

Sigla continued in its para 48:-

“In the light of the considerations in General Motors, paragraph 47 above, paragraph 30, which are applicable to the present case by analogy, it is possible, particularly in the case of an opposition based on a mark with an exceptionally high reputation, that the probability of a future, non-hypothetical risk of detriment to or unfair advantage being taken of the mark cited in opposition by the mark applied for is so obvious that the opposing party does not need to put forward and prove any other fact to that end. However, it cannot be assumed that this is always the case. Indeed, it is possible that the mark applied for does not, at first sight, appear capable of giving rise to one of the three types of risk covered by Article 8(5) of Regulation No 40/94 with respect to the earlier mark with a reputation, even though it is identical with or similar to the earlier mark. In those circumstances, the opposition must be rejected as unfounded unless such a non-hypothetical, future risk of detriment or unfair advantage can be established by other evidence which it is for the opposing party to put forward and prove”.

In Antartica Srl, the NASDAQ case, on the subject of what the opposer must, in this regard, establish, the CFI added, on the subject of prima facie evidence of a future risk, that it could be established:

“…in particular, on the basis of logical deductions resulting from an analysis of the probabilities and by taking account of the usual practices in the relevant commercial sector as well as all the other circumstances of the case”.

- see its para 54.

Finally, the Court of Appeal in the Intelmark case supra set out at length the passage from Advocate-General Jacobs’ opinion in Adidas-Salomon on “dilution” at para 18 of the judgment of Jacob LJ. In Intelmark the Court of Appeal told the parties that it intended to refer questions to the ECJ. Jacob LJ. indicated how he would answer the questions; Mummery and Keene LJJ. agreed. At para 29 Jacob LJ. indicated:-

“If a trade mark for particular goods or services is truly inherently and factually distinctive it will be robust enough to withstand a mere passing bringing to mind when it or a similar mark is used for dissimilar goods or services. The average consumer is a reasonably sensible individual. He is used to lots of trade marks in different fields – some of which may resemble trade marks for other fields. In this country, for example, for a long time Jif lemon juice and Jif washing up liquid co-existed happily, not to mention Jiffy for padded bags and condoms. Sometimes, but perhaps not surprisingly, trade mark owners of big brands want more protection than they really need”.

That passage, of course, was directed to where the goods or services are dissimilar. The risk of relevant unfair advantage being taken, perhaps also of relevant detriment being suffered, is, I would think, likely to be greater where the goods or services are identical.

That concludes the review of the three main areas of the law with which I have been concerned and I must now turn to examining whether, in his decision, the Hearing Officer, if I take that review to be the state of the law on the subjects, committed some material error of principle in the course of arriving at his conclusions. First, I shall simply state what his conclusions were.

Before the Hearing Officer, Direct Line had opposed esure’s registration under three headings namely:-

The Hearing Officer respectfully agreed with Lewison J’s remarks in Bellure supra that there is no minimum threshold as to similarity (or, at least, none such as Mr Wyand QC had argued for in the Bellure case). I have no reason to think that the Hearing Officer had seen Mr Wyand’s Skeleton Argument or otherwise knew of just what threshold Mr Wyand had argued for. Mr Silverleaf urges that the Hearing Officer here erred in principle. Mr Hobbs took that to be Mr Silverleaf’s argument here and so do I. For the reasons I have given, unlike the Hearing Officer, I would hold that there is the threshold which I have described.

At his para 114 the Hearing Officer concluded:

“In my view, a distinctive feature of both marks is the unusual juxtaposition of wheels attached to (albeit recognisably different) electronic communication devices. I find that this gives rise to a recognisable similarity between the marks”.

Mr Silverleaf draws attention to the passage in the Hearing Officer’s paragraph 110 where he said:

“The requirement for similarity is therefore passed when there is any visual, aural or conceptual similarity between marks which is likely to be recognised as such by an average consumer.”

He had said much the same in his paragraph 108; once there was that degree of similarity then the Tribunal was obliged to go on to consider the other factors identified in section 5(2)(b) or section 5(3) of the 1994 Act. As will have been seen from my observations on thresholds, I take a different view but it is not, as it seems to me, a difference that can here be magnified into a material and clear error of principle. The difference in approach would only have been a material error of principle if, upon adopting my view as to the threshold, I had taken the view that the threshold had not been equalled or exceeded. But, as I have indicated, in my view the threshold is low, as I have described it, and was exceeded. The Hearing Officer, in my view, was thus obliged to go on to consider whether there was a likelihood of confusion in the manner that he did and, equally, to consider questions as to unfair advantage and detriment, as I shall come on to, as he did.

I would add this (as I apprehend Mr Silverleaf asserted error in principle as to the Hearing Officer’s response to conceptual similarity): it is difficult to elevate matters essentially of weight and degree into ones of principle but, even if one were to take out of the Hearing Officer’s evaluation his concept of desk top electric communication devices as a feature common to both, I would, having regard to other similarities between the mark and the sign (especially if the mouse could be used in red with black wheels) nonetheless take the low threshold to have been exceeded.

That likelihood was very much a matter for evidence and, as to its evidence, Direct Line quickly ran into difficulties. Direct Line had chiefly relied, as I have mentioned, upon a full-scale public survey professionally conducted between the 6^th and 13^th July 2005. In its evidence and argument, esure launched a sustained attack on that survey. esure’s main attack was based on the possibility, to put it no higher, that Direct Line’s very extensive advertisement campaign, begun after the relevant date, the date of esure’s application to register, and continued at least down to the dates of the surveys, and showing a phone on wheels accompanied by its “friend”, the mouse on wheels, had, by the time of the surveys, so corrupted or infected what otherwise might have been the public’s view of a mouse on wheels on its own as to make the surveys worthless. The Hearing Officer, for reasons I shall deal with later, concluded that such were the uncertainties inherent in the surveys that they could not be taken by him to be a reliable indication of what an average consumer would have thought at the date of the application. In consequence he approached the matter on the basis that the survey evidence was of no assistance – see his paragraph 94. I shall, for the moment, take it that his rejection of survey evidence involved no error of principle.

The Hearing Officer, of course, looked at a number of similarities and dissimilarities. The esure mouse had a low and sleek profile whereas the Direct Line telephone was more angular and old fashioned; the tyres and tread on the esure mouse were like those on a road car whereas the tyres on the Direct Line telephone were more tractor-like; the esure mouse had the letter “e” in the centre of each wheel and there were eyes on the top of the mouse. But the presence of the letter “e”, he said, was not a strong distinguishing feature and the eyes were not always visible and were not a strong distinguishing feature either. Such minor factors were overlaid by the need, consistent with authority, to form an overall impression. There was one easily recognisable and powerful difference to which he alluded in his para 129 in the following terms:

“Nevertheless, I do not believe that an average consumer, who is deemed to be reasonably observant and circumspect, making a considered purchase such as an insurance policy, would fail to notice the differences between DL’s telephone on wheels and esure’s computer mouse on wheels marks. There are a number of detailed differences, but the most telling one is that both marks are based upon well known and easily recognised desk top communication devices which consumers are able to tell apart. I therefore reject any claim of a likelihood of direct confusion”.

The Hearing Officer accordingly turned to indirect confusion, where the public makes a connection between the proprietors of the sign and those of the mark and confuses them. He accepted in his paragraph 133 that the detailed styling of the computer mouse does not contribute to any “family resemblance” between the esure sign and Direct Line’s telephone mark and continued, at his paragraph 134, as follows:-

“The dominant and distinctive feature of both marks is that they consist of wheels attached (in the same way) to an object which a) does not usually have wheels, and b) represents one of the two main channels of doing business with a direct seller of financial services and insurance. The fact that one mark would be recognised as being a telephone on wheels, whereas the other would be recognised as a computer mouse on wheels, does not mean that consumers wouldn’t recognise that these devices represent alternative channels of communication with a direct seller. The modest degree of visual similarity between the marks (essentially the wheels and the vehicular appearance) is therefore enhanced by a greater degree of conceptual similarity. In my view, the visual and (particularly) conceptual similarities between the dominant and distinctive feature of the marks will have a greater impact on the average consumer than the detailed visual and aural differences”.

The Hearing Officer posed the question to himself, would an average consumer of the services in question, who was familiar with Direct Line’s established telephone on wheels mark, have believed that the mark applied for was a new variant of Direct Line’s established mark? esure had argued that, after all, Direct Line had been content to continue with its use of the telephone on wheels mark for five years after it had begun trading on the internet. Why should Direct Line, Mr Silverleaf had asked, be taken as having adopted a new mark to identify its new internet business, years later? Indeed, Mr Blackett, Group Deputy Chairman of Interbrand Group Limited, an international branding consultancy, gave evidence on behalf of Direct Line to the effect that it would be extremely unusual for a business with such a valuable mark as Direct Line’s telephone on wheels mark to drop it in favour of another. But, then raised the Hearing Officer, might it not be that the esure mark would have been regarded as a development of the telephone on wheels mark, reflecting the changing tools for conducting business, once on-line quotations became predominant? Might it not be not so much that Direct Line, he asked himself, had dropped its telephone on wheels mark but rather that the mouse on wheels should be intended to supplement the telephone on wheels mark? The Hearing Officer continued, at his paragraph 139, as follows:

“DL’s position as the market leader in the direct insurance market, and the fact that it was up until the date of esure’s application, the only company in the relevant market sector using a communication device on wheels as a mark, are further reasons for supposing that an average consumer might have been confused into thinking that the mark applied for was a mark of DL, or at least a mark used by an economically linked undertaking. There is in fact some evidence that some of the larger insurers are behind the services offered by a number of other undertakings. However, there is no evidence that consumers are generally aware of this and I therefore attach no weight to this evidence”.

Bearing in mind that the Direct Line mark was invariably in red with black wheels and (as I shall need to come on to) that the esure application, if granted, would allow esure also to use red with black wheels, the Hearing Officer concluded:

“The use of the mark applied for in that colour would plainly serve as a further pointer to DL. Taking all of the above into account, I find that at the date of the application, the use of the mark applied for in the colour red would have been likely to cause indirect confusion with DL’s earlier mark. As the use of the mark in that colour is an example of normal and fair use of the trade mark, I find that the objection under s.5(2)(b) succeeds”.

It is plain from that summary that, crucial to the Hearing Officer’s conclusion, was his view that an average consumer might have been confused into thinking that the mark applied for was a mark of Direct Line or at least a mark used by an economically linked undertaking. That view could be arrived at without error of principle only if it was based upon evidence laid before the Hearing Officer and accepted by him or was such that it could properly be inferred from that body of evidence. Without such evidence there would have been an error of principle in the sense that the Hearing Officer would have taken into account something which he had no sufficient reason to take into account. Was there, then, evidence before the Hearing Officer such that he could have concluded therefrom as he did? As he laid aside the survey evidence altogether the answer can only be found in evidence other than in the surveys. Was there any such sufficient evidence?

Relatively few of Direct Line’s witnesses spoke to the likelihood of confusion in the indirect sense of an average consumer thinking that esure’s mark as applied for was a mark either of Direct Line or at least one used by an economically linked undertaking. Mr Blackett’s written evidence on the point was summarised by the Hearing Officer as being that:-

“There is a likelihood that because of the similarities between the esure mouse on wheels and the DL telephone [on] wheels, a significant number of the public would think that the esure mouse [on] wheels device was somehow connected with DL”.

But the reference to the mouse on wheels being “somehow connected” to Direct Line could, of itself, prove neither that it was a mark of Direct Line, nor a mark used by an economically linked undertaking nor that the public were thereby confused. Mr Blackett had also considered that even if there was no such confusion there was a likelihood of association but, for the reasons given – see paras 58, 59 and 61 above - under this 4(1)(b) hearing – a likelihood of association without there being material confusion would not be a sufficient ground for refusing registration. The Hearing Officer held that Mr Blackett (who, as was the case with all of the witnesses who gave oral evidence before the Hearing Officer, was found by the Hearing Officer to be a credible and truthful witness who had done his or her best to answer the questions put in a straightforward and helpful manner) had largely stood by what he had said in writing when he came to be cross-examined. But the Hearing Officer’s assessment of Mr Blackett’s oral evidence did not add anything further, in relation to this particular class of confusion, to what his written evidence, inadequate for immediate purposes, had said.

My view that the Hearing Officer erred in principle in considering, as he did, that a relevant likelihood of confusion was sufficiently proved by the evidence which he accepted is heavily dependent upon the Hearing Officer being right in his rejection of evidence of Direct Line’s main and lesser surveys. In its Respondent’s Notice Direct Line raises whether the Hearing Officer had been right to reject, as he did, the main survey and Mr Hobbs built upon that opening in oral argument. In his paragraph 90 the Hearing Officer had stated, with my emphasis:-

“In this case I am satisfied that the procedural defects identified in the way that the survey was conducted do not undermine Mr Phillips’ assessment of the levels of public association shown in the JMA survey”.

That observation is plainly limited to the procedural defects in the survey not invalidating it, but the Hearing Officer then went on to deal with the potential of Direct Line’s pre-survey advertising campaign using its familiar phone with wheels mark but now with its “friend”, the mouse on wheels, alongside, to corrupt the level of association in the public’s mind between any mouse on wheels and Direct Line’s long-established phone on wheels mark. esure (not, as the Hearing Officer recorded it, Direct Line) had instructed Mr Philip Malivoire, a Director of GfK Consumer, the consumer division of GfK NOP and an expert in the field. Mr Malivoire, along with all other of esure’s witnesses, was not required to be cross-examined, and he had asserted, as the Hearing Officer records at his paragraph 46(a), that the timing of the surveys, that is to say both the mini surveys and the main survey, alongside Direct Line’s advertising campaign featuring its own computer mouse on wheels undermined any value that the surveys might have had in measuring association between the mark applied for and Direct Line’s telephone on wheels mark prior to the commencement of that advertising. The Hearing Officer expressed no misgivings of substance as to Mr Malivoire’s evidence and so the Hearing Officer thus had expert evidence, for him to assess, to the effect that the surveys were rendered valueless. It could not thus reasonably be said that Direct Line’s campaign could not possibly have had any muddying effect and thus it was for the Hearing Officer as the fact-finder to weight up the evidence on the issue. At his para 94 he concluded that:-

“The reality is that no one can say what effect the parties’ post-application advertising had on the results of the mini surveys and the main JMA survey. I therefore regard the advertising factor as introducing too much uncertainty as to permit the results of the surveys to be taken as a reliable indication of what an average consumer would have thought at the date of the application. Consequently, I have approached the matter on the basis that the surveys’ evidence is of no assistance”.

There was, as it seems to me, no reason why the Hearing Officer should not distinguish between the procedural defects in the survey and the more substantive defect to which he there referred and no reason, notwithstanding that the procedural effect did not on its own render the survey worthless, that he should not find that the substantive defect did have that result. Mr Hobbs is here undone by the very argument which he himself advanced as to what is the appropriate test in relation to an appeal such as this; the respect to be paid to the Hearing Officer’s decision is such that, in the absence of an error of principle, I must, like the Hearing Officer, conclude the survey evidence was of no assistance. I have not been able to detect any error of principle in the Hearing Officer’s reasoning on the issue and so the argument raised by the Respondent’s Notice on this issue does not, in my judgment, weaken my earlier conclusion that no relevant likelihood of confusion was sufficiently proved by such evidence as the Hearing Officer did accept.

I have not understood that Direct Line successfully put in issue esure’s motives in choosing to use a mouse on wheels in the sense of its looking for a free ride or to cause detriment to or to take unfair advantage of the distinctive character or repute of the phone on wheels.

Mr Hobbs had submitted to the Hearing Officer that a mere risk of detriment or unfair advantage was sufficient to engage section 5(3). The Hearing Officer accepted that the Court was concerned to distinguish between a real risk and a hypothetical one. But he went on (with my emphasis) as follows:

“In the UK the standard of proof required in civil proceedings is generally to show that, on a balance of probabilities, a given event occurred or will occur”.

As for proof of the Additional Link, the Hearing Officer, no doubt entitled to clothe himself with the mantle of the average consumer, had before him the evidence of his own eyes and concluded that there was a recognisable similarity between mark and sign – his para 114. There was – his para 134 – a modest degree of visual similarity and a greater degree, he held, of conceptual similarity between them. There was, of course, identity of services. Before esure’s application no one but Direct Line had used a non-vehicular wheeled device or logo in connection with insurance or financial services. Mr Blackett had given evidence that even if there was no confusion there was nonetheless a likelihood of an association being made by members of the public, meaning, I apprehend, a belief that Direct Line and esure were in some way associated, that there was a relationship between them – see paras 33 and 34 of Mr Blackett’s report. It is to be remembered that the Hearing Officer held that what Mr Blackett had said in his written report had largely held up throughout cross-examination.

But was there evidence from which the Hearing Officer could find a real rather than hypothetical risk of tarnishment or blurring or of esure taking a free ride? Whereas, in relation to similarity and the likelihood of confusion, a Hearing Officer can often, no doubt, draw, without impropriety, on the evidence of his own eyes and his or her experience as a consumer, this may be said to be a more technical area where evidence from advertising, marketing and commercial men needs evaluation and is more likely to carry the day – see also para 89 supra. It fell to the Hearing Officer to evaluate such evidence. The Hearing Officer held that Mr Blackett in his written evidence had given evidence that adoption by esure of a computer mouse on wheels took unfair advantage of the distinctive character of Direct Line’s telephone on wheels by trading off and exploiting, to esure’s benefit, the reputation that Direct Line had established in its mark. Indeed, said Mr Blackett, if Direct Line’s telephone on wheels mark was required to share distinctive features (wheels and/or colour) with esure’s mouse, the distinctive character of Direct Line’s mark would be so reduced that it would not be wise for Direct Line to continue to promote that mark because it could not be confident that money spent promoting the telephone on wheels mark would not also benefit esure. I have failed to see why Mr Blackett should not have been believed and so am unsurprised that the Hearing Officer accepted the thrust of Mr Blackett’s evidence; at his paragraph 164 he said so and continued:-

“In my judgment, a link which has this effect is parasitic in nature and therefore unfair”.

There was evidence going the other way; in particular a hypothetical question put to Mr Ross elicited an answer, if the question had thoroughly been understood, that if there was no confusion between the marks (and, as I have indicated, in my view none was proved) then the use by esure of its proposed mark would not cause any damage to Direct Line. But the question of the weight to be given to answers, including conflicting answers given to questions by witnesses, is quintessentially a matter for the fact-finder, here the Hearing Officer, and especially could that be said to be so where reliance is placed on a hypothetical question based on an hypothesis which the witness did not accept and where the task of the tribunal below included evaluation of evidence which spread over many facts and factors. Whilst other Judges might, without impropriety, have assessed matters otherwise, it cannot reasonably be said that the Hearing Officer was obliged, if he was not to err in principle, to arrive at an assessment of the whole corpus of the evidence that was consistent with the answer to that one hypothetical question. Given the evidence, which he accepted, of Mr Blackett, evidence which Direct Line’s current Marketing Director, Mr Tildesley, supported and given, too, a reflection upon where the onus lay, I cannot see any error of principle in the conclusion of the Hearing Officer as to unfair advantage save that, for the reasons I have given, he regarded the test to be satisfied by Direct Line as more stringent than it should have been. It is to be remembered that, where there is similarity and a very distinctive earlier mark of high reputation, relevant unfair advantage or detriment may even sometimes be assumed - see para 88 above – which, in relation to Direct Line’s marks, suggests that the Hearing Officer could have concluded as he did without there being massive evidence to support the conclusion he reached.

In its Respondent’s Notice Direct Line argues that the Hearing Officer should have found that use of the mark applied for by esure would fetter Direct Line’s capacity to exploit the commercial value of its famous telephone on wheels mark by its introducing a mouse on wheels in which the heritage of its telephone on wheels mark was embodied. That fetter, argues Direct Line, is an additional reason for finding in its favour on the basis of unfair advantage or detriment. The Hearing Officer met that argument in his paragraph 150 where he said as follows:-

“Counsel for esure submitted that fettering or inhibition cannot be accepted as a form of damage to the reputation or distinctiveness of an established mark because it is fundamental that trade mark registration protects existing rights and not future developments. I agree. In my judgment “fettering” is not an independent head of damage. If the use complained of unfairly exploits, tarnishes or blurs the distinctive character or repute of the earlier mark, it will be caught under the plain language of the section. Use which doesn’t have any of those effects should not be caught under the alternative head of “fettering”. This is because it would amount to giving the proprietor of an established mark with a reputation a right to object simply because someone else has applied to register a mark that he would have liked to have used or registered. And that would fall foul of the principle that trade mark registration protects only existing rights”.

That, as it seems to me, is a comprehensive answer to the argument and is one that embodies no error of principle. If, in relation to other aspects of section 5(3), I have been correct in upholding the views of the Hearing Officer then Direct Line needs no additional reason for a finding in its favour under the section but, were Direct Line to need some additional reason, I would not hold that its argument as to this form of fettering provided one.

At para 6 of its Respondent’s Notice Direct Line argues that the potential use of the esure mouse on wheels sign in connection with poor quality services could adversely affect the standing of Direct Line’s telephone on wheels trade mark in the eyes of the public and thus harm its overall reputation and reduce its selling power. There was, argues the Respondent’s Notice, an ever-present jeopardy from tarnishment. That, argues the Respondent’s Notice, constitutes a material risk of detriment to repute. This attack, as it seems to me, is exactly the sort of attack which the CFI in Sigla supra intended to rule out when it said that the objector must produce prima facie evidence of a future risk, which is not hypothetical, of detriment. The Hearing Officer describes no evidence of any likelihood of esure providing poor quality services, either such as would tarnish Direct Line’s mark or at all, nor, in the course of argument, was any such evidence drawn to my attention. In his paragraph 174 the Hearing Officer, dealing with such an argument, held as follows:

“It is submitted on behalf of esure that this is nothing more than speculation. There is nothing to suggest that esure’s reputation as an insurer is such as to reverberate negatively on DL. I agree. I reject this submission”.

I detect no error of law in the reasoning that led to that conclusion and accordingly reject the reject the argument in the Respondents’ notice that the Hearing Officer should have found that section 5(3) was made out in respect of detriment to repute by tarnishment.

Before the Hearing Officer Direct Line, by Mr Hobbs, had submitted that in the absence of a proposal by esure for the mouse on wheels to be registered in any particular colour the Hearing Officer was required to consider normal and fair use of the mark in all colours. The Hearing Officer held Mr Hobbs’ argument on the point to be correct and he concluded that he was thus required to contemplate the effect of the use of the mouse on wheels mark “in any colour, including red”. In Direct Line’s Respondent’s Notice there is a heading which leads to a suggested conclusion, namely that the claim for protection by registration by esure was accordingly for the shape graphically represented, inter alia, in the colour red so as to confer protection in respect of the use of the shape, inter alia, in the colour red. In practical terms there is, as it seems to me, no difference between the contention in the Respondent’s Notice and the finding, which I have cited, by the Hearing Officer on the issue. However, Mr Silverleaf did in argument raise that the Hearing Officer erred in principle in relation to colour. He had paid too much regard to the possibility of esure using a red mouse with black wheels. But esure never foreswore the use of red and black, as they so easily could have done had that represented their intent and, all in all as to colour, I have failed to find any material error of principle in this respect on the Hearing Officer’s part.

In its Respondent’s Notice Direct Line seeks to build upon the Hearing Officer’s finding at his paragraph 127 that the phone on wheels mark had acquired a huge reputation in the financial services market and “was extremely distinctive, even in black and white. When seen in its customary red livery the mark was even more distinctive of the services of Direct Line”. Yet, when the Hearing Officer came to his conclusion on likelihood of indirect confusion, he relied to a material degree upon Direct Line’s use of red. At his paragraph 143 he said:

“In this case the colour red serves to reinforce the association of the earlier trade mark with DL. The use of the mark applied for in that colour would plainly serve as a further pointer to DL. Taking all of the above into account, I find that at the date of the application, the use of the mark applied for in the colour red would have been likely to cause indirect confusion with DL’s earlier mark. As the use of the mark in that colour is an example of normal and fair use of the trade mark, I find that the objection under s.5(2)(b) succeeds”.

The complaint raised in the Respondent’s Notice is, in effect, that the Hearing Officer should specifically have held esure’s mouse on wheels would give rise to the existence of a likelihood of confusion even when it was used in black and white. But the point only becomes material to the overall outcome if the Hearing Officer could be said to have erred in principle in his view that, given that esure had not limited the colours which it applied to use but had sought registration in black and white form, the conventional interpretation of such an application was that, if registration were to be granted, registration in any colour (including black and white) would have been protected. As I have not understood Mr Silverleaf to argue that the Hearing Officer erred in principle in that respect, the argument raised under this heading in the Respondent’s Notice adds nothing of substance and, as I am not only loth to tinker but obliged not to tinker with the Hearing Officer’s conclusions, short of a demonstrated material error of principle, I would prefer to leave his paragraph 143 and its reference to colour exactly as it is.

At a number of points in his argument Mr Hobbs said that, dependent upon what otherwise would be my conclusion, a reference of one or more questions to the European Court of Justice might become necessary. If, for example, I were to hold, in Mr Silverleaf’s favour, that the Hearing Officer had fallen into material error of principle in holding that there had been a degree of conceptual similarity between the rival mark and sign, then a particular question (which Mr Hobbs offered in draft) arose for reference. But I have not found there to be a bar to registration by reason of Article 4(1)(b) so it becomes somewhat academic to separate questions as to similarity from the overall result and, moreover, it was Mr Silverleaf’s argument that in any event the draft question never arose.

Thirdly, Mr Hobbs argued that if I were not to accept the Hearing Officer’s reasoning in relation to unfair advantage and detriment under section 5(3) then, he said, the following question would arise:

“Is it permissible to uphold an objection to registration under Article 4(3) or Article 4(4)(a) of Directive 89/104 simply upon the basis that the opposed trade mark is likely to be linked with the earlier trade mark in the perceptions of the relevant average consumer in circumstances where the earlier trade mark possesses a strong distinctive character and is both well known and protected in respect of goods or services of the kind for which the opposed trade mark is sought to be registered?”

For the reasons I have given, whilst the appeal succeeds as to Article 4(1)(b) (section 5(2)(b)), it fails as to section 5(3) (Article 4(3)) and hence, overall, the appeal fails in the sense that, in my judgment, the Hearing Officer’s conclusion that esure’s mark shall not be registered should stand.