High Court clarifies meaning of 'consent' in context of trademark applications

In a ruling dated December 1 2014 in the Chancery Division of the High Court, the Hon Mr Justice Arnold has clarified the meaning of 'consent' in the context of trademark applications (Dalsouple Société Saumuroise Du Caoutchouc v Dalsouple Direct Ltd ([2014] EWHC 3963 (Ch))).

Section 5 of the Trademarks Act 1994 states:

"(4) A trademark shall not be registered if, or to the extent that, its use in the United Kingdom is liable to be prevented—

(a) by virtue of any rule of law (in particular, the law of passing off) protecting an unregistered trademark or other sign used in the course of trade…

A person thus entitled to prevent the use of a trademark is referred to in this act as the proprietor of an “earlier right” in relation to the trademark.

(5) Nothing in this section prevents the registration of a trademark where the proprietor of the earlier trademark or other earlier right consents to the registration."

Dalsouple Direct Ltd (Dalsouple UK) was the exclusive UK distributor of rubber flooring products manufactured by Dalsouple Société Saumuroise Du Caoutchouc (Dalsouple France). Dalsouple UK registered the term 'Dalsouple' as a UK trademark in 1998.

In 2011 Dalsouple France sought to extend its international trademark DALSOUPLE to the United Kingdom.  Dalsouple UK opposed the application on the basis of its earlier UK registration and Dalsouple France sought to invalidate the UK mark on grounds including bad faith. It argued that Dalsouple UK was its agent at the time of filing and had registered the mark without Dalsouple France’s knowledge or consent. The hearing officer found on the facts that Dalsouple France had consented to the registration (consent could be verbal). Accordingly, Dalsouple UK’s opposition was successful and the application for invalidity failed.

Dalsouple France appealed on the basis that the hearing officer should have concluded that consent had to be in writing, unconditional and unequivocal, and that the alleged consent had failed to meet these requirements. A key issue was whether the test for consent, which the Court of Justice of the European Union had considered in the parallel imports case of Zino Davidoff SA v A & G Imports Ltd (Joined cases C-414/99 to C-416/99), should be applied as the test for consent to register a trademark where earlier rights are asserted.

Arnold J dismissed the appeal and found that the meaning of consent in Zino Davidoff also applied in the context of trademark applications. He held that a person consenting to the registration of a trademark must unequivocally demonstrate his intention to renounce his rights, whether in writing or not. An express statement of consent would satisfy that requirement. Whether an express statement of consent has been made is a matter of fact, to be determined in accordance with normal English rules of procedure but the burden of proving consent is on the party making that allegation. It was not necessary for the court to have clear evidence of what was said, it simply had to be determined whether it was more likely than not, on the balance of probabilities, that consent was given.

The hearing offer had found, on the facts before him, that Dalsouple France had made an express oral statement of consent and thus an unequivocal demonstration of an intention to renounce the right to prevent Dalsouple UK from registering the trademark in the United Kingdom. Arnold J saw no error of law in his approach and held that he was entitled to reach that conclusion.

The decision shows the importance for brand owners of retaining control over the registration of their brand in different territories, particularly where there are local distributors and agents. Any goodwill arising from the activities of local distributors should be expressly proven to revert to the brand owner.

Sharon Daboul, EIP, London