New decision on implied consent issued

In Honda Motor Co Ltd v Neesam ([2008] EWHC 338 (Ch), the Chancery Division of the High Court of England and Wales has held that Honda Australia had impliedly consented to the sale of Honda motorbikes to one of the defendants.

Both claimants were companies within the Honda group. The first and second defendants were partners in the third defendant, a business that parallel imported genuine Honda motorbikes. Honda initially obtained summary judgment against all three defendants and against another defendant in respect of certain bikes that were the subject of other proceedings.

The present case concerned the parallel importation of Honda motorcycles into the United Kingdom and their subsequent resale by the fourth defendant. Between 1999 and 2004 the fourth defendant purchased a substantial number of bikes from an Australian company that had purchased them from Honda Australia and from the worldwide parallel imports market. Honda Australia was aware that:

• the Australian company was a dealer within the trade; and
  
  
• it would resell the bikes to non-Australian purchasers, which would in turn resell the bikes in the course of retail or wholesale trade.

Honda nevertheless sued the fourth defendant in the United Kingdom, alleging trademark infringement. The fourth defendant denied liability. It alleged that since Honda, through its Honda Australia operation, had consented to it putting the motorcycles on the UK market and selling them (before that consent was officially withdrawn in May 2003), its trademark rights were exhausted. Honda denied that any consent had been given to market the bikes in the United Kingdom or elsewhere in the European Union. It also added that any consent that it might have given was terminated at the end of June 2002 (the date on which it discovered the final destination of the motorbikes that it had sold to the Australian company).

The court held for the defence. On the evidence, Honda Australia had impliedly consented to the sale of bikes to the fourth defendant, so that the bikes could be resold in the course of its own business. Therefore, Honda's claim for relief failed, except in respect of the consignments of bikes supplied by the Australian company after consent was explicitly withdrawn on May 2003.

Jeremy Phillips, IP consultant to Olswang, London