Bakery restrained from selling newly packaged bread in controversial decision

The recent Irish High Court action taken by McCambridge Limited against Joseph Brennan Bakeries (Brennans) was one of the most interesting cases of 2011. The action was taken when the latter company introduced a new packaging for its rectangular loaf of whole-wheat brown bread. The new packaging consisted of a transparent, re-sealable pack with a dark green rectangle and the BRENNANS red and yellow mark on the front.

McCambridge's product:

Brennans' product:

The High Court determined that the issue to be decided was whether a member of the public wishing to purchase McCambridge's brown bread would be confused into buying the newly packaged Brennans loaf in error. While it was acknowledged that McCambridge did not have any proprietary rights over such transparent, re-sealable packaging of a rectangular loaf of whole-wheat brown bread, the High Court was satisfied that the company had developed a reputation and achieved a dominant market position over many years to the extent that average consumers would associate such packaging with McCambridge whole-wheat brown bread.

 

The established principles of passing off were heavily relied upon, namely:

In determining whether McCambridge had established sufficient reputation or goodwill in the particular packaging, the High Court indicated that, while McCambridge may not be in a position to claim a monopoly on each of the individual elements of the packaging, overall, it had demonstrated a reputation and goodwill in the combination of all the elements, thus easily satisfying the first part of the test. Similarly, the third part of the test was easily determined. The court held that, should McCambridge successfully prove that there was misrepresentation by Brennans, loss would be an “inevitable foreseeable consequence”.

 

When considering whether Brennans had misrepresented its bread as that of McCambridge, it was held that a deliberate intention to do so was not necessary. McCambridge claimed that, when deciding on the new packaging, there was a deliberate intention on the part of Brennans to mimic its well-known design, a claim that Brennans denied. In support of its allegation, McCambridge referred to correspondence between the defendant and the design company in which alterations to the packaging were suggested to bring “it closer to McCambridge's”. The court rejected McCambridge's claim, a claim that ultimately proved irrelevant to the substance of the court’s decision. Intention on the part of Brennans to mimic the packaging of McCambridge was not necessary. Instead, the court was concerned with whether a reasonable member of the public wishing to buy McCambridge's whole-wheat brown bread would be confused by the new packaging of Brennans’ whole-wheat brown bread and, as a result, would buy the latter in error.

 

In an attempt to demonstrate the likelihood of such confusion occurring, counsel for McCambridge recreated a typical shop shelving display in the courtroom showing the competing products on sale immediately adjacent to one another as was deemed typical of all or most retail outlets. The purpose of this exercise was to allow the court to act as the average reasonable consumer, who is not unnecessarily rushed or unduly slow. While it was determined that the competing products have differentiating features, such as the respective trademarks on the front green panels, in reality loaves of bread on a shop shelf “get tossed around on the shelf” and, as a consequence, such differentiating features, although visible when tidy and upright, may not be so visible to the consumer when lying flat on the shelf. Even careful shoppers may not be able to distinguish between the loaves in such circumstances. It is the first impression that is crucial and consumers cannot be expected to exert the same level of scrutiny as occurs during a trial. It was further determined that, despite the use of Brennans’ red and yellow logo on the front, the overall appearance of the packaging from the vantage point of the average reasonable consumer would lead to confusion. This raises the question as to whether it will now be necessary for companies to ensure that their product is distinguishable from all angles potentially visible to the consumer.

 

Ultimately, the High Court granted injunctive relief to McCambridge restraining Brennans from selling its whole-wheat bread as packaged. In determining the issue of costs, the court took into account the unnecessary, time-consuming claim of intent made by McCambridge against Brennans and, as a result, awarded the plaintiff only 40% of its costs. 

 

This decision to grant an injunction contrasts with an earlier UK case concerning Asda and Specsavers. The Chancery Division for England and Wales placed a greater emphasis on the placement of Asda’s own branding on the mark in question and held that, despite the existence of other similar features, such use of its logo was sufficient to distinguish the marks. While the Irish court acknowledged that Brennans genuinely believed the placement of its logo on the front panel would sufficiently distinguish the products, ultimately it is the overall impression of the consumer that is of greater importance.

 

Brennans had, at the time of writing, secured a stay on the order on condition that its appeal to the Supreme Court was lodged without delay. As a result, both products remain on shop shelves for the time being.