Use it (correctly) or lose it: another warning to sports clubs

In Score Draw Ltd v Finch, Judge Mann sitting in the Chancery Division of the High Court has held that the fact that a mark had been used in a non-trade manner did not necessarily prevent it being used as a trademark. However, if the prior use had removed the mark's power to be distinctive of trade origin, its registration would be barred by Section 3(1) of the Trademarks Act 1994. Following the drawn-out Arsenal decisions (see Arsenal win on the replay and Arsenal win in Europe but suffer shock defeat at home), this case reaffirms that brand owners, and sports clubs in particular, should ensure that their emblems are used correctly and are under licence.

The judge allowed an appeal by the appellant, Score Draw Ltd, of a decision of Hearing Officer Ann Corbett of August 3 2006 dismissing its application for a declaration that the registration of the mark by Alan James Patrick Finch was invalid.

The mark was the badge of the Confederação Brasileira de Desportos (CBD), formerly the Brazilian governing body for sport, and was used by the Brazilian football team between 1914 and 1971.

The mark had appeared on the national team's shirts in numerous football matches, as well as on the shirts of famous football players such as Jairzinho and Pelé. Finch, the registered proprietor of the mark, had licensed TOFFS Ltd to use it on replica football clothing. Score Draw also used the mark on replica football clothing, technically infringing Finch's registration. Score Draw applied for a declaration that the registration of the mark was invalid on a number of grounds, including that the mark was devoid of distinctive character.

The judge stated that it was necessary to consider whether the use of the badge had become so associated with the Brazilian football team that it was incapable of being rendered distinctive of a proprietor using the badge as a trademark. The evidence showed that the CBD badge has been used to indicate team loyalty or affiliation (echoing the High Court's decision in the Arsenal Case). For example, until 1971 the badge was the emblem of the CBD and the Brazilian football team. Since that time it has more commonly been used as the badge of famous Brazilian football teams or players. The evidence showed that the sole purpose of the badge was to give authenticity to replica shirts.

Brand owners will welcome the finding that the mere fact that the badge had not been used as a trademark did not mean that it could not subsequently acquire that characteristic. However, in this case the actual use of the badge had caused it to become associated with famous Brazilian football teams in a non-trademark sense. As a result, the registration had failed to maintain its distinctiveness and was held to be invalid.

Darren Olivier, Field Fisher Waterhouse LLP, London