Assessing the balance of convenience in interim injunctions to prevent passing off
- Planet Art issued a passing-off action against Photobox’s ‘Photobox Free Prints’ app and applied for interim injunctive relief regarding its ‘FreePrints’ app
- The deputy judge found that the balance of convenience lay in favour of Photobox and refused Planet Art’s application
- This judgment highlights the effectiveness of entering into undertakings voluntarily as way of tipping the balance of convenience
In an application for an interim injunction to prevent passing off, the High Court has determined that the relative merits of the parties’ cases and the effect of an undertaking provided by the defendant should be considered in assessing the balance of convenience ( EWHC 1688 (Ch)).
The claimant, Planet Art, offers an app called 'FreePrints' that provides online printing services. The defendant, Photobox, has a competing app called 'Photobox Free Prints'. Planet Art issues a passing-off action against Photobox under the shorter trials scheme and applied for interim injunctive relief. The substantive hearing for the application took place on 20 May 2019 and was heard by Pat Treacy, sitting as a deputy judge.
In applying the American Cyanamid principles, Treacy acknowledged that – in certain cases for passing off – it is appropriate to consider the merits of the case while applying the established principles relating to interim relief. This is because in cases of passing off the questions of damage and likelihood of damage are intimately intertwined with the strength of the cause of action itself. Therefore, an assessment of damage, misrepresentation and goodwill are each within scope in determining whether there is a serious issue to be tried and where the balance of convenience between the parties lies.
Use of descriptive words
Photobox argued that there was no “serious issue to be tried” as it was not possible for the requisite goodwill to arise in relation to the term ‘Free Prints’. This is because – Photobox claimed – the term was clearly descriptive and had not acquired a secondary meaning. Treacy agreed that secondary meaning was essential for an entirely descriptive term and that deception was only possible under the doctrine of passing off if use of the term could be shown to have become “distinctive”.
Planet Art argued that the term ‘FreePrints’ (in its elided form) had acquired a secondary meaning. In response, Photobox claimed that even if the term had acquired a secondary meaning, the un-elided form that was actually used by Photobox was sufficiently different and therefore could not give rise to a misrepresentation. Treacy concluded that it was not possible – at an interim stage – to discount Planet Art’s arguments and held that there was a serious issue to be tried.
Impact of undertakings on the balance of convenience
Having found that damages would not be an adequate remedy for either party, the balance of convenience between the parties was then considered (ie, where the lowest risk of injustice would arise from granting or refusing interim relief). In this case, the assessment involved a consideration of the:
- likely harm to both parties;
- difficulties in quantifying the damages suffered; and
- relative merits of the parties’ cases.
Central to the issue of likely harm was the implications of undertakings that Photobox had voluntarily agreed to enter into prior to the hearing. The undertakings restricted Photobox’s ability to market its app and ensured that the appearance of the app – which had already been revised by Photobox – would not be altered prior to trial. Treacy held that the presence of the undertakings reduced the prospects of deception (and therefore misrepresentation) and significant damage being suffered by Planet Art. Together with the “material weaknesses” in Planet Art’s case, the undertakings were a significant factor in Treacy’s finding that ther balance of convenience lay in favour of Photobox. Therefore, the application was refused.
While Treacy’s view on use of a descriptive term in the scope of a passing-off action is certainly interesting, a judge at full trial – with the benefit of all the parties’ evidence – may well come to a different conclusion. Interested parties will have to wait and see what happens if the case makes it to court as expected in May 2020. Perhaps what is more noteworthy from this judgment is the clear effectiveness of entering into undertakings voluntarily as a way of tipping the balance of convenience. Defendants should consider this as part of any defensive strategy when faced with an application for interim relief.
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