A trade mark protects the use of images and words in commercial
communications, but the Comparative Advertising Directive says that
trade marks can be used in comparative advertising, to a limited
extent.
The Directive, which has become law in the UK via the Control of
Misleading Advertisements Regulations, says that it may be
"indispensable, in order to make comparative advertising effective,
to identify the goods or services of a competitor, making reference
to a trade mark or trade name of which the latter is the
proprietor".
O2 says that a 3 advert which used bubbles as a reference to O2
when comparing its prices with O2's infringed its trade marks. The
case was won by 3 in March of this year, when the High Court ruled
that the adverts did violate O2's trade marks but came under the
comparative advertising exemption.
In assessing the appeal of the case, the Court of Appeal's Lord
Justice Jacob said that Europe needed to decide the relative
strengths of the competing laws.
"The trial judge, Lewison J, opened his [High Court] judgment
saying 'this is a case about bubbles.' And so it is," said Jacobs
in his ruling. "But it is also about a lot more. How aggressively
does EU law permit comparative advertising to go? Particularly can
the advertiser not only use his rival's main name or trade mark but
also, honestly, his subsidiary registered trade marks including
marks embodying his trade imagery (what the Americans call trade
dress)? The question deep down involves a decision based upon the
philosophy of how competitive the law allows European industry to
be."
Jacobs has referred three questions to the ECJ in order that the
law across Europe be standardised. The three questions are:
- "Where a defendant in the course of trade uses a sign in a
context purely for the purpose of comparing the merits (including
price) of his goods or services with those of the trade mark owner
and in such a way that it cannot be suggested that the essential
function of the trade mark to guarantee the trade mark as an
indication of origin is in any way jeopardised, can his use fall
within either (a) or (b) of Art.5.1 of Directive 89/104?"
- "Where a defendant uses, in a comparative advertisement, the
registered trade mark of another, in order to comply with Art. 3a
of Directive 84/450 as amended, must that use be 'indispensable'
and if so what are the criteria by which indispensability is to be
judged?"
- "In particular, if there is a requirement of indispensability,
does that requirement preclude any use of a sign so similar to the
registered trade as to be confusingly similar to it?"
Although he referred these questions to the ECJ, he also gave
his own views on some of the issues involved. He said that the use
of the O2 bubbles did not break the rules of the Trade Marks
Directive on the question of causing a likelihood of confusion for
consumers.
Jacobs said that some of the law needed to be clarified because
it was not clear how a court should treat it. "Now there are some
oddities about the Comparative Advertising Directive," he said.
"One has the uneasy feeling that those responsible for this
legislation had but a hazy idea of how various kinds of IP rights
could apply to comparative advertising."
Jacobs said that he would refer the questions to the ECJ but was
open to negotiation on exactly how they should be framed. "I do not
regard those I have suggested as set in stone and they should be
open to post-judgment discussion," he said.
