How to avoid expensive Intellectual Property Litigation - The "cleaner" way to proceed
Thursday 10th June 2010When launching new products, manufacturers often carry out "freedom to operate" clearance searches, to try to ensure that the appearance of their products and the brand names they adopt for their products do not infringe any registered intellectual property rights owned by a third party.
For example, they often carry out patent, registered design and registered trade mark searches, to see what third party rights are out there, which they might inadvertently and unknowingly infringe. They also often give their designers strict instructions not to copy the appearance of existing third party products, when they believe the appearance is protected by unregistered design rights.
However, many manufacturers do not appreciate that when choosing a design for a new product (in respect of which all relevant third party owned registered intellectual property rights have already been checked and cleared), they must also ensure that they do not market the new product in such a way as to lead the public to believe that the new product is the product of a third party.
In England, this legal principle is recognised by the law of passing off, which can be summarised in one short statement - no man may "pass off" his goods as those of another.
A recent action, concerning vacuum cleaners, highlights the importance of understanding and complying with the law of passing off when choosing a design for a new product.
In the case of Numatic International Limited v Qualtex UK Limited, the defendant threatened to sell a product which, if marketed, would, by its appearance and get up, have deceived purchasers into thinking it was one of the claimant's well know 'Henry' vacuum cleaners.
For those readers who are not well versed in the appearance of vacuum cleaners, Numatic produce a range of vacuum cleaners known as the 'Henry' range. The vacuum cleaners are of a tub type construction, with a domed black lid (which looks a little bit like a bowler hat). Below this, the main body of the vacuum cleaner is often red in colour. There is printed on the front the features of a smiling face, with the name 'Henry' printed on the domed black lid. The nose of the face of a 'Henry' vacuum cleaner is the hole where the hose emerges from the tub and it looks a little bit like an elephant's trunk when the hose is connected.
Qualtex decided to manufacture and sell a replica of the Henry cleaner. Qualtex believed that, provided they chose a design in respect of which all relevant intellectual property rights had expired (e.g. national and community registered and unregistered design rights and trade marks) they would be legally free to do so. Thus, they produced a prototype cleaner, which they displayed at a cleaning show at the NEC in Birmingham in March 2009. The prototype vacuum cleaner did not have the name 'Henry' printed on it. Nor did it have a Henry smiling face, or anything confusingly similar. However, the Qualtex product was of a tub type construction, with a domed black lid and a hole at the front of the vacuum cleaner where the hose was connected - very much like a typical Henry vacuum cleaner.
Qualtex were convinced that because they had not used the name 'Henry' and they had not used the Henry smiling face they were legally entitled to sell the product. Numatic thought otherwise and brought legal proceedings against Qualtex for passing off.
In summary, the judge hearing the case held that the evidence showed that Numatic had a protectable goodwill and reputation in the combination of features that comprised a Henry vacuum cleaner (e.g. the name 'Henry', together with the black bowler hat top, brightly coloured base, the smiley face and the nose). Even though the Qualtex product lacked the smiley face and name 'Henry', it still retained the overall shape and appearance (including the bowler hat) of a Henry vacuum cleaner. This constituted a misrepresentation, such that potential purchasers of the Qualtex vacuum cleaner might think it was a genuine Henry and at least some members of the public would buy it thinking it was a Henry. The omission of the smiley face and of the name 'Henry' was not sufficient to avoid a successful claim in passing off. Not all sensible purchasers would be put on enquiry by their absence on the Qualtex vacuum cleaner. The public had been educated to recognise the overall shape of the vacuum cleaner, combined with the black bowler hat, as indicia of a genuine Henry vacuum cleaner. The omission of the smiley face and the name 'Henry' would probably lead some potential purchasers to simply think that they had been taken off to give the Henry a more serious, professional look. As a result, the passing off claim succeeded.
Historically, it has been thought difficult to bring successful claims in passing off to protect the shape of a functional article (rather than, for example, the name under which it is sold). However, the Henry case demonstrates that, provided evidence can be obtained that consumers are likely to be confused as to the origin of a defendant's product, based on its shape and appearance, it is possible for a claimant to bring successful passing off proceedings against a defendant (i.e. where the defendant sells a product where the overall shape and appearance leads consumers to believe it is a product produced by the claimant).
The moral of the story is that if you are thinking of launching a replica or look-a-like product, you need to make sure that you don't infringe any relevant third party owned intellectual property rights. This includes both registered rights and unregistered rights, such as product features protected by the law of passing off. Sound legal advice should always be sought before launching and marketing a new product. It would be a commercial disaster if, subsequently, you are sued successfully by a third party competitor for infringement of their intellectual property rights. Not only may damages and legal costs be payable by you to the said third party competitor, but the product itself may have to be removed from sale - which will be both commercially embarrassing and will result in lost revenue.
If you would like to discuss any of the issues raised by this article, please feel free to contact the author, Carl Steele, on c.steele@ashfords.co.uk or on 01392 333997.
Ashfords LLP is regulated by the Solicitors Regulation Authority. The information in this note is intended to be general information about English law only and not comprehensive. It is not to be relied on as legal advice nor as an alternative to taking professional advice relating to specific circumstances.
