Trademark litigation provides lessons on costs, confusion and consent

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Urbanbubble claimed there was a likelihood of confusion. His case was largely based on emails received from investors who asked if there was a connection between Urban Evolution and Urbanbubble.

However, the High Court considered the circumstances in which the emails were sent before determining that the test for establishing likelihood of confusion had not been met.

The investor emails were sent after Urban Evolution replaced Urbanbubble as property lettings manager for the commercial units in a building in Liverpool in which Urbanbubble continued to act as lettings agents for the properties residential areas of the building.

“The circumstance of [Urban Evolution] replace [Urbanbubble] for the same role in the same building and acting on the instructions of the same property developer … increased the risk of confusion,” His Honor Justice Hacon said. “Assuming that the similarity between the mark and the sign was an operative cause of the confusion, which I think is probable, the confusion would also have depended on this set of circumstances. Without these circumstances, there would be no probably had no risk of confusion.

HHJ Hacon considered that the evidence provided by Urbanbubble in support of its likelihood of confusion hypothesis “does not establish that there was a risk that the use of the sign Urban Evolution would create a well-founded belief in the “mind of the average consumer investor that there was was an economic connection” between the two companies. The judge said that “there was at most a risk that the average consumer saw it as a probable possibility”, but that “this does not seem to me to satisfy the criterion of likelihood of confusion”.

Evidence of genuine confusion as to the origin of goods or services can be very difficult to find. Rights holders who believe they have such evidence will therefore believe they have a strong case for trademark infringement.

This decision, however, is the latest in a number of judgments from courts in England and Wales which show that there is a high bar to be overcome in proving genuine confusion to support a conclusion that the average consumer would probably be confused. It is not enough for someone to wonder whether there is an economic link between competing brands. This case shows that courts will consider the larger context when determining whether the average consumer – in this case, real estate investors – truly believes the companies are related.

Consent

Urbanbubble’s failure to meet the likelihood of confusion test caused its primary claim for trademark infringement to fail, but the High Court nonetheless considered the infringement defense that Urban Evolution had advanced in if the court found otherwise – that he had consented to use his trademark.

At the heart of Urban Evolution’s defense was an exchange of emails related to a logo that Urban Evolution had used when launching its website. Urbanbubble asked Urban Evolution to change the logo after complaining that it looked like theirs.

Urban Evolution dropped their original logo and adopted a new logo instead, and later received an email from Urbanbubble’s sole director. The email noted the change and said it was “time to move on.” The director also said in his email that the Urban Evolution company had his “blessing”.

Urban Evolution cited the email as evidence that it had consented to use its Urbanbubble trademark, pointing out that it showed that Urbanbubble had only raised an issue with its original logo and not with the business name of the company.

Urbanbubble argued, however, that the director objected to the use of the Urban Evolution name and articulated it to Urban Evolution when raising his objection with the logo. However, HHJ Hacon pointed to changes in the evidence given by the Urbanbubble director regarding the circumstances in which he expressed this objection. HHJ Hacon said the new point he raised was “difficult to reconcile with his email.”

The High Court held that Urban Evolution did not need Urbanbubble’s consent to use the Urban Evolution name but that it was “given nonetheless”.

The judgment shows that consent to the use of a mark can be given in the absence of a formal coexistence agreement.

This case, however, highlights the problems that can arise if trademark owners engage with others about the use of their mark and shows the care that must be taken in the wording of correspondence.

Cost implications of prosecuting directors

After the High Court delivered its judgment, both Urbanbubble and Urban Evolution made representations to the court regarding the level of costs arising from the proceedings against Urbanbubble.

When considering costs, the court took into account that Urbanbubble had named a director of Urban Evolution as a co-defendant in the case, thereby seeking to hold it jointly and severally liable with the company for trademark infringement.

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