Lottery winner awaited following preliminary ruling

In Inter Lotto (UK) Limited v Camelot Group Plc, the High Court has confirmed that a right to a registered trademark is not a right to use that mark to the exclusion of others. Rather, it is an exclusive right to prevent others from using the mark under certain circumstances. As a result, another party can use the trademark so long as it does so in a way that is not likely to cause deception or confusion.

The High Court's ruling arose from a preliminary issue in a dispute between two companies operating lotteries in the United Kingdom. Inter Lotto has used the unregistered trademark 'hot pick' since 2001. It brought proceedings for trademark infringement and passing off against Camelot Group for its use of the term 'hotpicks'. Camelot has a pending registration for 'hotpicks' and it raised a number of defences.

The central issue before the court was whether Inter Lotto could rely on its use of the unregistered 'hot pick' trademark, after the date Camelot applied to register the term 'hotpicks', as evidence in its claim for passing off. Camelot argued that Inter Lotto could not rely on this evidence since such use would be unlawful if Camelot was successful in its application to register 'hotpicks'.

The High Court examined the law of passing off and trademark infringement, and rejected Camelot's defence. It held that a right to a registered trademark (or a pending registration) is not a positive right (ie, a right to use that mark to the exclusion of others). Rather, it is an exclusive right to prevent others from using the mark under certain circumstances (ie, it is a negative right). Passing off on the other hand, said the court, is a distinct right that protects a trademark owner's reputation and goodwill, not its trademark per se. Thus, a rival trader can use another party's trademark so long as it does so in a way that is not likely to cause deception or confusion. The court concluded that a registered trademark owner (or as here the owner of a pending registration) does not have an entitlement to use its mark in the face of earlier competing rights owned by another party.

As the issue was a preliminary point, the fight for 'hot pick' and 'hotpicks' is set to continue.

Darren Olivier, Field Fisher Waterhouse, London