Red Bull's intention to use BULLIT sufficient to deny defence to trademark infringement

In Red Bull GmbH v Sun Mark Ltd ([2012] EWHC 1929 (Ch), July 17 2012), the Honourable Mr Justice Arnold has handed down his decision in the dispute between Austrian energy drinks giant Red Bull GmbH and UK-based independent drinks company Sun Mark Limited (and associated shipping firm Sea, Air and Land Forwarding (SALF)).

Red Bull's intention to use the mark BULLIT was found to be sufficient so as to deny Sun Mark and SALF a defence to trademark infringement of the registered marks BULLIT (ie, on the basis that Red Bull had acted in bad faith in applying to register the BULLIT marks). The defendants were also found to infringe RED BULL in respect of the use of NO BULL IN THIS CAN.

After being inspired by an energy drink whilst on a trip to Thailand in 1984, Dietrich Mateschitz - founder and managing director of Red Bull - brought to Europe a drink which would become (in 2011) the fourth most-valuable brand worldwide in the soft drink sector and has sales in 157 countries totalling 340.7 billion cans (in 2010). Sun Mark is a UK-based drinks company which imports, exports and distributes both its own and third-party fast-moving consumer products. SALF is its associated shipping partner.

On April 12 1999 Red Bull demonstrated an interest in protecting the mark BULLIT by filing an Austrian trademark application in Classes 32, 33 and 34 of the Nice Classification. That mark was then used as a basis for an international registration, which subsequently designated the United Kingdom. Various prior rights in the United Kingdom meant that the specification was limited to "beer" but, crucially, this application revealed the earlier UK right of W&S Holding BV for BULLIT (with a filing date of May 31 1996), which would come to have key strategic importance in the battle of the parties over the next 13 years. 

On September 8 2000 SALF filed a UK trademark application for the mark BULLET in Class 32 for "health fruit drink; health fruit juice drink, still and carbonated". The 1996 BULLIT registration of W&S Holding BV was not cited against the application at the time (although it should have been), but was later used (by Red Bull) to invalidate the registration.

From there began a protracted standoff around the validity and priority of the marks BULLIT and BULLET in the United Kingdom for Class 32 goods, which included the aborted approach by Red Bull to buy the SALF registration (no price could be agreed, the opening suggestions of £1,500 v £100,000 being too far apart to pursue). However, once it successfully acquired the 1996 BULLIT registration in July 2005, Red Bull had the upper hand. As a result of that acquisition, the previously (provisionally) refused designations of two later filed BULLIT international registrations were registered. 

Red Bull could then afford to be bullish, challenging both the 2000 registration in the United Kingdom and a published application at OHIM for the mark BULLET filed on November 7 2005. In March 2007 Red Bull contacted the defendants alleging infringement of its BULLIT rights in the United Kingdom. Proceedings were not actually issued until May 2010, by which time Red Bull had invalidated the SALF registration by virtue of the 1996 BULLIT registration, thereby successfully removing SALF's initial defence under Section 11(1) of the Trademarks Act 1994.

The findings of infringement of the BULLIT registrations and RED BULL (for use of NO BULL IN THIS CAN) do not seem too surprising given the enormous reputation, marketing spend and presence of the mark RED BULL and/or BULL alone for energy drinks, perhaps even canned drinks.

The decision that Red Bull did not act in bad faith (so as to provide a defence to the above infringements) by applying for protection in the United Kingdom for the two international registrations for BULLIT has given some guidance on the standard of intention required to satisfy the test, at least under the 1994 act (Section 32(3)) - as well as providing a useful recap of 'bad faith' and 'intention to use' principles.

Essentially, the court found that the "possible or contingent intention to use [BULLIT] at some future date may suffice" (depending on the circumstances of the case) and, in this case, did. Red Bull's original applications to register BULLIT in the United Kingdom were part of a strategy to secure rights in a mark which do not need to predate the launch of a product (and typically do not). The "tentative" plans of Red Bull to use BULLIT on a drink (against the backdrop of occasional flurries of 'bull'-themed applications) were sufficient under the circumstances, which included an unquestionable interest in energy drinks and a clear interest in the UK market generally.

So no escape for Sun Mark and SALF to the infringement; but will they have the energy to bring an appeal, or be prepared to bite the bullet?

Harriet Seymour, Field Fisher Waterhouse, London