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Trade Marks and Passing Off

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Schutz v Delta Containers [2011] EWHC 1712 (Ch)

In a judgment handed down on 5th July in the Chancery Division, Mr Justice Briggs found in favour of the claimant company and awarded an injunction to restrain the defendant company from infringing its trade mark and from passing off its products as those of the claimant. The case was based on infringement of a Trade Mark and also on ‘passing off’.
The claimant produced rigid composite intermediate bulk containers (‘IBCs’) of a capacity of around 1000 litres for use in the transportation and storage of liquids. These comprised a metal cage surrounding a plastic bottle mounted on a pallet. The usable life of the cages exceeded that of the plastic containers. The defendant was in the business of rebottling – replacing the plastic container in a used IBC – and started to supply bottles that did not come from the claimant: this practice is known as ‘cross bottling’. The cages of the IBCs carried the claimant’s trade marks. The defendant did not remove those marks from the cage. It was alleged that they were infringing the claimant’s trade marks in relation to the bottle and to the IBC as a whole. It was also alleged that the defendant’s conduct amounted to passing off its cross-bottled IBCs as those of the claimant: that their conduct amounted to a misrepresentation that the bottle was manufactured, or least approved, by the claimant such that the IBC was still a Shutz product.
From March 2008 the defendant had attached adhesive labels to the cross-bottled IBCs as disclaimers to show that they were not supplied of endorsed by Shutz. The Shutz trademarks remained on the cages.
A great deal of evidence on both sides was addressed to the question of what customers – ‘the average consumer’ – might have concluded. This was a key matter for the judge to determine in the light of conflicting evidence and his conclusion was the Shutz trade marks on the cage would be seen as being used in relation to the whole IBC. The disclaimers were inadequate.
In relation to the passing off claim, there was no dispute that the claimant had goodwill to protect in relation to the IBCs. The case turned on the question of whether the public would believe the cross-bottled IBCs were the products of Schutz and the judge was satisfied that the claim was made out.

Notes :

Community Trade Mark regulations 207/2009
Trade Marks Act 1994

“Passing Off” : The judge applied the test laid down by Lord Oliver in Reckitt & Colman Products Limited v Borden Inc [1990] RPC 341, at 406:
“The law of passing off can be summarised in one short general proposition – no man may pass off his goods as those of another. More specifically, it may be expressed in terms of the elements which the plaintiff in such an action has to prove in order to succeed. These are three in number. First, he must establish a goodwill or reputation attached to the goods or services which he supplies in the mind of the purchasing public by association with the identifying “get-up” (whether it consists simply of a brand name or a trade description, or the individual features of labelling or packaging) under which his particular goods or services are offered to the public, such that the get-up is recognised by the public as distinctive specially of the plaintiff’s goods or services. Secondly, he must demonstrate a misrepresentation by the defendant to the public (whether or not intentional) leading or likely to lead the public to believe that goods or services offered by him are the goods or services of the plaintiff. Whether the public is aware of the plaintiff’s identity as the manufacturer or supplier of the goods or services is immaterial, as long as they are identified with a particular source which is in fact the plaintiff. For example, if the public is accustomed to rely upon a particular brand name in purchasing goods of a particular description, it matters not at all that there is little or no public awareness of the identity of the proprietor of the brand name. Thirdly, he must demonstrate that he suffers or, in a quia timet action that he is likely to suffer, damage by reason of the erroneous belief engendered by the defendant’s misrepresentation that the source of the defendant’s goods or services is the same as the source of those offered by the plaintiff.”