Key points
In Industrial Cleaning Equipment v Intelligent Cleaning Equipment and another, the Court of Appeal held that the five-year period for statutory acquiescence starts to run once the owner of the earlier trade mark becomes aware of the use of the later trade mark, and the later trade mark is in fact registered, whether or not the owner of the earlier trade mark has actual knowledge of the fact of registration.
In this case, it meant that the five-year period started to run from when the later trade marks were entered on to the UKIPO register as the Claimant was already aware of the Defendants’ use.
The distinction is quite nuanced but it has significant impact. It is a timely reminder that trade mark owners (or more likely its trade mark attorneys) should monitor the registries carefully and take prompt action against later infringing trade marks.
As pointed out during submissions in the case, requiring knowledge of the registration of the later trade mark would give the earlier rights holder a disincentive to consult the trade mark register, in order to delay the start time of the five-year period, which would be contrary to the policy reason for having a public register in which to check for earlier marks.
Whilst out of the scope of this article, the judgment contains a useful walk through of General Court and ECJ decisions, policy considerations and the approach of the EUIPO on this topic. At least for now it appears that the approach is not settled at EU level.
What is statutory acquiescence?
When faced with a claim of trade mark infringement or opposition proceedings, statutory acquiescence is a key defensive tool. It prevents the owner of an earlier trade mark or other earlier right from challenging the later registered trade mark after five years' acquiescence of its use. The policy reasoning for this defence is to penalise earlier rights holders who are “insufficiently vigilant to stop use of later trade marks”.
Background
The Claimant used logos comprising the acronym “ICE” for commercial and consumer cleaning equipment in the UK since 2007. The Defendants imported for distribution and sale floor cleaning machines using the acronym “ICE” since June 2013. The Claimant’s ICE logo was registered at the UKIPO on 22 January 2016.
The first Defendant is the proprietor of two International Trade Marks (“ITMs”) designating various territories including the EU; one for the word mark ICE and one for a logo incorporating ICE. The trade mark applications were accepted by the EUIPO on 24 May 2016 and 14 June 2016 respectively and were recorded as having a date of entry on the EUIPO register on 25 May 2016 and 15 June 2016 respectively. Following Brexit, they were converted to UK trade marks.
On 2 July 2019, the Claimant sent a Letter Before Claim alleging trade mark infringement and passing off. A Claim Form was later issued on 24 May 2021. It was accepted that the Claimant did not have knowledge of the Defendants’ registered trade marks prior to 26 July 2019 (when the Defendants responded, citing their own trade marks). However, it admitted to having knowledge of the Defendants’ use of ICE from around July 2014.
High Court Decision
The High Court held that the defence of acquiescence did not apply because the five-year period only started to run when the Claimant had knowledge of both the use of the later trade mark and its registration (applying Budvar) on 26 July 2019. Therefore, the Court found that the Defendants had infringed the Claimant's trade mark and the Defendants’ trade marks were invalid based on the Claimant’s earlier rights.
Court of Appeal Decision
On the first ground, departing from Budvar, the Court of Appeal held that the five-year period started to run once the owner of the earlier trade mark becomes aware of the use of the later trade mark, and the later trade mark is in fact registered, whether or not the owner of the earlier trade mark holder has actual knowledge of the fact of registration.
On the second ground, the Court held that for international trade marks protected in the EU, those marks would be deemed to be registered when the mark is accepted by the EUIPO or the second republication date by the EUIPO.
The appeal was dismissed because even if the five-year period started on 24 May 2016 (when the first trade mark was accepted by the EUIPO), the Claim Form was issued on 24 May 2021, which is the last day of the five-year period and therefore just in time to stop a full five years' acquiescence accruing.
The Court of Appeal also considered what action by the Claimant would stop the acquiescence “clock”. It suggested that a warning letter could be sufficient to stop the clock if administrative or court action is commenced within a reasonable period of time following the letter. In this case, however, the Court stated that there was an unreasonable delay following issuing the warning letter on 2 July 2019 and issuing the Claim Form on 24 May 2021.
The Court also clarified that statutory acquiescence is also a bar to a claim in passing off.
For more information or if you have any questions, please contact Emily Roberts or Holly Webb or your usual IP team contact.
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