Court of Appeal finds genuine use of Specsavers logo in final instalment of Specsavers v Asda

On October 15 2014 the Court of Appeal handed down its judgment in Specsavers International Healthcare Ltd v Asda Stores Ltd ([2014] EWCA 1294). In delivering the leading judgment, Lord Justice Kitchin ruled that Specsavers' appeal should be allowed and that its wordless Community trademark (CTM) should not be revoked for non-use.

The business impact of the decision is as follows:

• Extensive use of a composite logo with words can constitute genuine use of a wordless registered trademark within the meaning of Articles 15 and 51 of the Community Trademark Regulation (207/2009), if there is convincing evidence to this effect.

• Kitchin LJ cautioned against this decision being of widespread application finding that, "in general, it is unlikely that the background of a mark will be perceived by the average consumer as an indication of origin". This was an unusual case.

This decision is related to the long-running battle between Specsavers and Asda for trademark infringement. The infringement proceedings have been concluded, with the parties settling on confidential terms.

In the first instance infringement proceedings in October 2010, Mann J ordered that Specsavers' CTM No 1358589 (‘the wordless logo mark’) as set out below should be revoked for non-use. The mark was registered in black but without any express colour limitation, and so is deemed registered in all colours as per the Court of Appeal's ruling in the Phones 4u case ([2006] EWCA Civ 244).

Whilst Asda had originally argued for the revocation of this mark on non-use grounds during the infringement proceedings, this was an appeal with no respondent. As part of the settlement, Asda agreed that Specsavers was at liberty to pursue this appeal at its own expense in relation to the revocation order of Mann J. The registrar of trademarks was given permission to intervene in the proceedings on the basis that Specsavers had to pay the costs of his intervention. Specsavers argued that its use of the logo depicted below (‘the shaded logo mark’) also constituted use of the wordless logo mark.

At first instance, Mann J held that the addition of the word 'Specsavers' in the composite logo altered the distinctive character of the wordless logo mark and, therefore, the use of the shaded logo mark could not be relied upon to maintain the wordless logo mark registration.

Applying the guidance from the Court of Justice of the European Union in Specsavers v Asda (C-252/12), Kitchin LJ found that the national court must consider the use which has been made, and ask itself whether the differences between the form in which the mark has been used and the way it has been registered did not change the distinctive character of the mark as registered. Accordingly, did Specsavers' wordless logo mark serve to identify the goods and services of Specsavers, even though the use was only by way of the composite shaded logo mark? Kitchin LJ admitted that Specsavers' argument did not seem very promising to him. The addition of the words 'Specsavers' was a highly distinctive and prominent delineating element when compared to the wordless logo mark. However, Kitchin LJ considered all of the following factors to be significant in changing his initial impressions:

1. The court was convinced that Specsavers had made very extensive use of the shaded logo mark in all aspects of its business over a long period of time. The extensive advertising use was highlighted with Specsavers spending £45 million on advertising in 2009 alone.

2. It was an important factor that none of Specsavers' competitors have a logo which is even vaguely similar to the shaded or wordless logo marks. This was not a case of Specsavers seeking to acquire a monopoly over a relatively banal or commonly used background.

3. There was trial evidence which made it clear that Asda had deliberately adopted a logo similar to Specsavers, describing its design drawing as "Asda version of Specsavers - rip off", amongst other examples. Kitchin LJ found that this meant that it was reasonable to suppose that Asda (which had a good understanding of the relevant market) was well aware that consumers identified the overlapping ovals as denoting Specsavers on its own, even without the addition of the word ‘Specsavers’.

4. Dame Mary Perkins (the co-founder of Specsavers) had given convincing evidence at trial, saying that the first thing she does when visiting a town is to "look for the shapes", or, in other words, the wordless logo mark. Her evidence helped to confirm to Kitchin LJ that from a distance, it is not the word 'Specsavers' which stands out, but the green overlapping ellipses which catch the eye.

Despite Kitchin LJ's initial impressions to the contrary, he allowed the appeal (with Lady Justice Black and the Lord Chief Justice of England and Wales in assent). Kitchin LJ found that Specsavers had succeeded in establishing that its use of the shaded logo mark also constitutes use of the wordless logo mark. The average consumer has perceived and does perceive the wordless logo mark as indicative of origin of the goods and services supplied by Specsavers. The use by Specsavers has been such that the differences between the shaded logo mark and the wordless logo mark have not changed the distinctive character of the wordless logo mark. The wordless logo mark has itself been seen as a trademark and not simply as background.

The registrar of trademarks expressed concerns that allowing this appeal might mean many new applications to register relatively commonplace outline shapes of logo marks. Kitchin LJ made it clear that each case must be determined on its own facts in light of all of the relevant circumstances, and that this was an unusual case where the evidence was particularly convincing. In general, it was highly unlikely that the background of a mark would be perceived as an indication of origin by the average consumer.

Joel Smith and Sarah Burke, Herbert Smith Freehills LLP, London