Legal Updates

Intellectual Property – Trademarks – Trademark Infringement – Advertising – Comparative Advertising – Malicious Falsehood – Misleading and Comparative Advertising Directive

 

In the recent case of Kingspan v Rockwool [2011],the High Court ruled on whether comparative advertising satisfied the Misleading and Comparative Advertising Directive 2006/114/EC (“MCA”) (implemented by the Business Protection Regulations 2008).  

Comparative Advertising

 

• Under the Comparative Advertising Directive, lawful comparative advertising does not infringe a registered trade mark and will not amount to trade mark infringement.
• The purpose of the Comparative Advertising Directive is to stimulate competition to the consumer's advantage while prohibiting unfair practices that are detrimental to competitors or consumer choice (Lidl v Vierzon)

 

Facts

 

• Kingspan manufacture insulation materials made of plastic foam.
• Rockwool manufacture non-combustible stone wool insulation materials.
• Rockwool’s advertisements showed the performance of the parties’ insulation materials in fire-growth tests in comparative terms. Rockwool’s aim was to demonstrate the difference between combustible and non-combustible insulation products.
• The advertisements took the form of road shows featuring small-scale fire demonstrations to an industry audience and marketing DVDs of footage of large-scale fire tests.

 

Proceedings

 

• Kingspan issued proceedings for malicious falsehood and trade mark infringement.
• Kingspan alleged that the road shows and marketing DVDs falsely represented that its products were dangerous.
• Kingspan also sought declarations that the road shows and DVDs did not comply with the Comparative Advertising Directive.
• Rockwool denied the allegations. It argued that because the tests were carried out independently under ISO 9705 fire test standard by SP Technical Research Institute of Sweden, this formed the basis of legitimate comparative advertisements. It thus argued that the use of Kingspan’s trade marks was permitted under the Directive and was not unlawful.

 

Claim for malicious falsehood

 

The claim was dismissed because Rockwool was deemed to have “acted throughout in good faith”. The fact that Rockwell had produced the DVDs through a reputable institute went in their favour as well as the fact that the DVDs were supplied to Kingspan for comment prior to distribution.

 

Claim for Trade Mark infringement

 

There was deemed to be no trade mark infringement by the use of the trade marks in the DVDs or on Rockwool’s website (although there were issues with DVDs released at an earlier date).

 

In relation to the ISO 9705 fire tests, the court found that the results:

§  were not appropriate for drawing conclusions about how Kingspan's roof panels would behave in a real fire when properly installed; and

§  suggested that Kingspan's products are dangerous when properly installed and used for their intended purpose.

 

 

The Court made it clear that a "serious risk" of damage in the future is sufficient to establish infringement (taking unfair advantage of, or being detrimental to the distinctive character or repute of the trade mark) under Article 5(2) of the Trade Marks Directive, rather than actual damage. This was despite the fact that no evidence was put forward of any actual damage or complaints from customers of Kingspan.

 

Points from judgement

§  “Comparisons of the properties of competitors’ products are to be encouraged and it is not open to a party to object to such comparisons simply because they are unfavourable to its products".

 

§  Comparative advertising should be assessed using the criteria "laid down in the European legislature".

 

§  The assessment is perspective of the average consumer, who is reasonably well informed, observant and circumspect (Lidl v Vierzon).

 

§  There are eight requirements for lawful comparative advertising (Article 4 Comparative Advertising Directive) and these are cumulative (L'Oreal v. Bellure).

 

Kingspan appealed, allegeding that the supply of the manuals and other materials to customers and others did not fetter confidence.

 

Held

 

Rockwool was unable to rely on the Comparative Advertising Directive to permit the comparative advertising as it was found to have infringed Kingspan's trade marks and therefore failed to fulfil all of the conditions of Article 4 for legitimate comparative advertising.

 

This is a useful approach for companies to establish whether advertising is misleading or not.

 

  If you require advice on exhaustion of rights or trade mark infringement, trademarks, please contact us at [email protected]

 

Visit http://www.rtcoopersiplaw.com or http://www.rtcoopers.com/practice_intellectualproperty.php

 

© RT COOPERS, 2011. This Briefing Note does not provide a comprehensive or complete statement of the law relating to the issues discussed nor does it constitute legal advice. It is intended only to highlight general issues. Specialist legal advice should always be sought in relation to particular circumstances.