LNDR beats LDNR: injunction granted against Nike
In a recent David & Goliath battle between Frank Industries Pty Ltd (Frank), an Australian company with an establishment in the UK, and sportswear giant Nike Retail BV (Nike), the UK Courts have demonstrated their ability to deal with time sensitive matters with great efficiency, by granting interim injunctive relief, ruling on an appeal and handing down judgment in the substantive trial within a six month period.
Interim injunction
Frank is the owner of UK and international (EU) trade mark registrations for the mark LNDR in respect of clothing and sportswear (the trade marks). The dispute with Nike arose in early January 2018 following the launch of Nike’s ‘Nothing Beats a Londoner’ advertising campaign (the Campaign) which featured prominent use (including on t-shirts) of the sign LDNR in conjunction with the well-known Nike Swoosh and the words ‘Nothing beats a….’. The campaign featured (a) films shown on YouTube and played in TV advertising breaks during major sporting events (b) advertising posters at two Premier League football games, (c) on Nike UK’s website and (d) on Nike’s social media accounts.
Following pre-action correspondence Frank issued a claim against Nike for infringement of its trade marks and passing off. Frank also sought interim injunctive relief (in relation to which it offered a cross-undertaking in damages of £500,000) and an expedited trial.
Nike counterclaimed for invalidity of the trade marks on the basis that the marks were inherently descriptive and non-distinctive. Nike also argued that it had a defence to infringement as it was using the sign LDNR to indicate a characteristic of the goods in question in accordance with honest practices.
His Honour Judge Hacon granted an interim injunction as he was satisfied there was a risk of Frank’s LNDR brand being fatally diluted by association with Nike before trial and that such prejudice could not be adequately compensated for by way of damages. The trial date was set for 12 July 2018.
Nike appealed the decision to grant an interim injunction.
Appeal
The Court of Appeal upheld the decision to grant interim injunctive relief although the court varied the wording of mandatory parts of the order so as to make it clear that Nike could archive the Instagram posts complained of and obscure sections of the campaign film on YouTube, rather than permanently deleting the same. The court also discharged the section of the order requiring Nike to delete the signs from its Twitter feed. In this regard, the judge had failed to consider the irreversible effect his order would have had if Nike was to permanently delete all LDNR references on its social media accounts.
The trial
The case was heard by Mr Justice Arnold sitting in the Intellectual Property Enterprise Court (IPEC).
In support of its counterclaim for invalidity Nike sought to show that the trade marks were being used as a known abbreviation for the word ‘Londoner’. In light of some evidence of use of the mark LNDR before the launch of the campaign Mr Justice Arnold accepted that, when used in an appropriate context in digital media, LNDR was capable of being used and understood to mean ‘Londoner’. However, Nike had failed to establish that LNDR would be perceived as such when used in respect of clothing, for example, on a swing tag or label in the absence of some context suggesting that meaning. The trade marks were therefore considered to be inherently distinctive in relation to clothing.
Frank’s claim for infringement and passing off ultimately succeeded as a result of the distinctiveness of the trade marks, the identity of the goods concerned, the high degree of similarity between the trade marks and the sign LDNR and in view of evidence of actual confusion.
Ultimately the court was satisfied that the average consumer would likely consider use of the LDNR sign in the campaign to indicate a tie-up or collaboration between Frank and Nike. Frank also succeeded in their claim for passing off.
Nike’s defence failed as they had not demonstrated that the sign LDNR is an indication of any characteristic of clothing. Furthermore, Nike’s use of the sign LDNR was not in accordance with honest practices for various reasons, including the fact that Nike knew of the existence of the trade marks before going ahead with the campaign.
Case details at a glance
Jurisdiction: England & Wales
Decision level: Intellectual Property Enterprise Court (IPEC)
Parties: Frank Industries PTY LTD (claimant) and (1) Nike Retail BV (2) Nike European Operations Netherlands BV (3) Nike (UK) Limited (defendants)
Hearing date: 20 June 2018
Citation: [2018] EWHC 1893 (Ch)
