Small ready meal delivery business reigns triumphant at the Intellectual Property Enterprise Court (IPEC) after one of the Court’s first virtual trials

Summary

A small healthy ready meal delivery business Fit Kitchen Limited (FKL) saw victory at the Intellectual Property Enterprise Court (IPEC) at the end of July 2020. After a one-day trial heard remotely, the presiding judge of the IPEC,  His Honour Judge Richard Hacon, found ready-meal manufacturer Scratch Meals Limited (SML) liable for trade mark infringement and passing off over use of the ‘Fit Kitchen’ trade mark.

The judgment followed a trial held over Skype in June 2020 in which SML, who sold the infringing FKL products to major supermarket chains Sainsbury’s and Waitrose, were found to have infringed the Fit Kitchen trade mark under s.10(2)(b) Trade Marks Act 1994 (the Act) and through passing off.  This was one of the first remote trials held in the IPEC.

FKL were represented by David Ivison of 11 South Square, instructed by Appleyard Lees IP LLP. SML were represented by Beth Collett of 8 New Square, instructed by Waterfront Solicitors LLP.

The figurative mark owned by FKL (UK00003179170) (the FKL mark):

The infringing mark as registered by SML (UK00003187357) (the SML mark):

FIT KITCHEN

An example of the infringing ready meal manufactured and sold by SML:

SML have now been ordered to transfer the SML mark to FKL with the matter now proceeding to the quantum phase when the court will assess compensation to be paid by SML.

The issues

HHJ Hacon was faced with three main issues in this case:

  1. SML’s assertion that the FKL mark was invalid as it had been filed in bad faith;
  2. Whether there had been trade mark infringement, and;
  3. Whether SML were liable for passing off.

Bad faith

The defendant’s bad faith claims (pursuant to s.47(1) and s.3(6) of the Act) were predicated on the temporary strike-off of FKL in 2016 during which time the FKL mark was filed. FKL’s owner claimed he was not aware of the dissolution, which resulted from an administrative error. The strike-off had been caused by an administrative error on the part of the company’s accountants. The company was restored once the error was discovered, Counsel for SML argued that the owner of FKL was aware of the strike-off, and that filing for the FKL mark in the name of a struck-off company fell short of the ‘standards of acceptable commercial behaviour observed by reasonable and experienced men in this area’. However, in his ruling, HHJ Hacon rejected SML’s claims. SML made a second argument that, having been dissolved, the company could not apply for or be granted a registered trade mark.  FKL argued that Section 1028 Companies Act 2006 provided that a company restored to the register after such a strike was rerstored to the register as though it had never been struck off in the first place and it was therefore able, after the event, to apply for and be granted a registration of a trade mark.  This argument was not ruled upon by the judge as he held it was unnecessary in the light of his general judgment in the case.  Such a ruling would have claified this issue.

Trade mark infringement

The next issue considered by HHJ Hacon was that of trade mark infringement, in particular, whether there had been infringement under both sections 10(2) and 10(3) of the Act. In considering these points, the judge ruled that the words “Fit Kitchen” were a dominant element in the figurative (or logo) trade mark and that, therefore, the use of this expression by EML was theoretically capable of constituting trade mark infringement.

Turning first to s.10(2), at trial, counsel for SML conceded that the SML mark is similar to the FKL mark and that the goods of the SML mark are similar to the services for which the FKL mark was registered. Therefore, HHJ Hacon needed to consider only whether the similarities led to a likelihood of confusion. FKL presented evidence of 65 instances where members of the public mistakenly contacted FKL regarding SML products. Thus, HHJ Hacon was satisfied that there had been relevant confusion and hence, infringement under s.10(2).

HHJ Hacon next had to consider infringement pursuant to s.10(3). After considering the sales of FKL, it was found that the evidence presented to the court was not sufficient to establish a sufficient reputation in the UK catering services market to justify a finding of infringement under this subsection. Therefore, FKL’s claim of infringement under s.10(3) failed.

Passing Off

After being successful in its claim of infringement pursuant to s.10(2), but unsuccessful in its claim pursuant to s.10(3), all that was left to consider was passing off. It was left to the Claimant’s counsel to establish that FKL had the three usual indicia of passing off, namely, goodwill in its business, that there was an actionable misrepresentation on the behalf of SML, and finally, that there was damage as a consequence.

Turning first to goodwill, whilst the date for assessing goodwill was the same date in proving reputation under s.10(3), in passing off, the threshold of use required to establish such good will is lower than what is needed to prove a reputation in accordance with EU trade mark Law. Therefore, HHJ Hacon was of the opinion that by December 2016, on the evidence already produced, the FKL Mark had been sufficiently used to generate the necessary goodwill. As a likelihood of confusion had already been established, this evidence also supported the conclusion that there had been an actionable misrepresentation by SML stemming from their use of FIT KITCHEN.  Finally, damage was found and therefore, the claim of passing off raised by FKL succeeded.

Conclusion

FKL succeeded in its claim that SML had infringed the FKL mark under s.10(2) of the Act, however, this was not found under s.10(3). Additionally, FKL were able to establish that there had been passing off on the part of SML in relation to FIT KITCHEN.

This judgment provides FKL with success in the first hurdle of its claims, with the claims against Waitrose and Sainsbury’s being stayed pending the outcome of the trial against SML which is now proceeding to the quantum phase.

Case reference: Fit Kitchen Ltd & Anor v Scratch Meals Ltd [2020] EWHC 2069 (IPEC).