Azumi v Zuma's Choice Pet Products
In Azumi Ltd v Zuma's Choice Pet Products & Others, the UK Intellectual Property Enterprise Court (IPEC) has addressed allegations of trade mark infringement based on the tarnishing and dilution of trade marks. For those brand owners with prestige marks the judgment provides a useful guide to enforcing their rights.
The claimant is the owner of, among others, a contemporary Japanese restaurant in London, which trades as Zuma. It has UK and EU trade marks for the word "ZUMA" registered in classes 42 and 43 covering the provision of food and drink. The restaurant enjoys a venerated reputation, with the trial judge, Her Honour Judge Melissa Clarke, commenting that "it has garnered extensive attention in the press and in restaurant guides which praise the spectacular décor, buzzing atmosphere and well-executed dishes."
In 2014, the defendant incorporated as Zuma's Choice Pet Products Ltd for the purpose of manufacturing and selling high quality pet food for dogs and cats. The company was named after the defendant's director and shareholder's dog, Zuma, a Japanese Akita/GSD cross. It registered the domain name "dineinwithzuma.com", applied for a UK trade mark for DINE IN WITH ZUMA and used the following sign on its website (the device):
Following the defendant's application for the UK trade mark, the claimant wrote to it alleging trade mark infringement. The correspondence did not elicit settlement, and subsequently the claimant commenced a claim for trade mark infringement before the IPEC and an opposition before the UK Intellectual Property Office (UKIPO). The defendant also commenced two further actions alleging unjustified threats (for more information on this cause of action see 'useful links' below). These actions ultimately went to trial in February 2017.
The claim of trade mark infringement was confined to Art. 9(2)(c) of the EU Trade Mark Regulation (and its equivalent s. 10(3) of the Trade Marks Act 1994), which provides:
... the proprietor of that EU trade mark shall be entitled to prevent all third parties ... from using in the course of trade, in relation to goods or services, any sign where: ...(c) the sign is identical with, or similar to, the EU trade mark ... where the latter has a reputation in the Union and where use of that sign without due cause takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the EU trade mark.
The allegation was made in relation to the use of the company name, domain name, the sign 'Zuma', the sign 'Dine in with Zuma' and the device. In its defence, the defendant pleaded that it was using its own name. As to the allegation of unjustified threats, the claimant admitted that the threats were actionable, but pleaded that they were justified.
The following issues fell to be determined:
- Whether the trade marks had a reputation in the UK and EU (as applicable);
- Whether the defendant was using the signs complained of in the course of trade;
- Whether the use of the signs would bring to the mind of the average consumer the trade marks;
- Whether there was dilution or tarnishment of the trade marks;
- Whether the defendant had an own name defence; and
- Whether the threats were unjustified.
The judgment helpfully summarises the applicable case law to each issue, and applies it to the facts. That of particular note is set out below.
Link in the mind of the average consumer
Having concluded that the trade marks had a reputation, that (with the exception of the company name) the signs were used on goods and services in the course of trade, and that the trade marks and signs were either identical or similar, it fell to be determined whether there was a link between the two in the mind of the average consumer.
Applying Specsavers International Healthcare Ltd v Asda Stores Ltd and Intel Corporation Inc v CPM United Kingdom Ltd, the court adopted a two stage test: (i) whether there was any opportunity for the average consumer to make a link; and (ii) whether the average consumer would make such a link.
As to the former, the court held that there was the opportunity as a proportion of the clientele at the claimant would own dogs and be in the market for dog food. On the issue of link, the court relied on the defendant's "humanising" of the dog food, offering it to "dine in", with options such as "cottage pie with cheesy mash" and "beef stew with liver and dumplings". While the defendant denied this, its defence was not assisted by the fact that the dog depicted was smartly dressed in a bow tie.
Tarnishment and dilution of the trade marks
As to tarnishment and dilution, the court relied on Red Bull GmBH v Sun Mark Ltd and L'Oréal v Bellure. On this issue, the court heard only one witness, the co-owner of the claimant.
He explained that there was an inherent tension between dog food and human food. This was analogous to the situation in R-318/2016-5 Dulces Conservas HELIOS SA v Guangzhou Petshine Pet Products Co Ltd where the Board of Appeal held that an application for DOG HELIOS for animal foodstuffs was likely to tarnish an earlier mark for jams and marmalade. The court held that the subsequent reduction in the connotations of prestige of the trade marks would also be likely to lead to a change in the economic behaviour of the claimant's clientele, resulting in dilution.
Own name defence
The defendant's own name defence did not succeed. It initially relied on the fact that the defendant's director's dog was called Zuma. This failed because the dog was not a natural person or company, nor party to the proceedings. The defendant subsequently modified its defence to rely on its company name. However, for the EU trade marks, under the new EU Trade Mark Regulation, this defence is no longer available for companies. As to the UK trade mark, the defence was not applicable as the defendant's name was not ZUMA (but rather Zuma's Choice Pet Products Ltd).
The court concluded that there was trade mark infringement in relation to all the signs, except for the company name. As a result, the defendant lost on its claim of unjustified threats, except in relation to the company name (as to which, no damages flowed).
Typically, before the IPEC costs recovery for the successful party is limited to £50,000, with the amount usually awarded being £36,000. However, because separate proceedings had been started (one by the claimant and two by the defendant) and, at the defendant's request, they had not been consolidated, in this instance the claimant was awarded £66,000.
Case details at a glance
Jurisdiction: England & Wales Decision level: IPEC Parties: Azumi Ltd v Zuma's Choice Pet Products Ltd Date: 24 March 2017 Citation:  EWHC 609 IPEC Full decision: http://dycip.com/azumivzuma
Specsavers International Healthcare Ltd v. Asda Stores Ltd,  EWCA Civ 24: http://dycip.com/specsaversvasda
Intel Corporation Inc v CPM United Kingdom Ltd,  EUECJ C-252/07: http://dycip.com/intelvcpm
Red Bull GmbH v Sun Mark Ltd & Anor  EWHC 1929 (Ch): http://dycip.com/redbulllvsunmark
L'Oréal SA v Bellure NV, C-487/07: http://dycip.com/lorealvbellure