The substantive proceedings relate to the vape sector and involve some of the leading retailers in the UK.
In the UK, statutory unjustified threats provisions are intended to prevent bad actors from misusing threats based on the infringement of intellectual property rights to wrongly intimidate other parties within the market.
This Judgment relates to an application for an interim injunction by the Defendant, restraining the Claimant from making further threats of proceedings for infringement of its trade marks. The Claimant had sent letters to eleven distributers and retailers of the Defendant which threatened to bring legal proceedings, the letters being sent just before Christmas 2024. The Defendant argued that the threats were unjustified and commercially intended to cause maximum damage and disruption to its business. In support of its position, it relied on various factors, including the timing of the letters being sent in the run up to Christmas, and the fact that the Claimant was not forthcoming in identifying the parties it had contacted. The Claimant argued that the threats were entirely justified and that it did not wish to overload the proceedings with excessive Defendants.
The Court ruled in favour of the Defendant where the judge ruled that the Claimant had not justified threatening proceedings, particularly given it had already put the distributers and retailers on notice of the existence of its registered trade marks. The inference was therefore that the actions of the Claimant were purely commercially motivated. The court reasoned that the Claimant had taken a scattergun approach when contacting retailers and distributers of the Defendant and did not genuinely intend to join them to the proceedings at hand. No plausible explanation had been given as to why it had chosen to only threaten certain parties but proceed to sue others.
How could it impact your business?
This case further highlights the need for brand owners to be very careful when sending cease and desist letters in relation to intellectual property infringement to third parties, especially when communicating with many third parties up and down the supply chain. Afterall, in this case the rights holder was represented and still fell foul of threat protective provisions.
What steps should you take?
A lesson to be drawn from this Judgment is that parties should proceed with caution when considering whether to make threats of legal proceedings in relation to the infringement of their intellectual property rights. Serious thought should be given as to the consequence of making such threats, as well as the likelihood that threats will actually be followed by legal action. There is a difference between placing a third party on notice of the existence of your intellectual property rights and making explicit threats of legal proceedings based on the alleged infringement of those rights. Courts are very wary of parties using unjustified threats for commercial means and will not hesitate to act where they are being unjustly weaponised against competitors.
Brand protection is vital for any business, increasingly so in the context of franchising where a franchisor has licensed a right for its network of franchisees to use its brand. If you have any concerns about whether a third party’s trade mark infringes a trade mark owned by your business, it would be prudent to seek legal advice prior to entering into communications with the third party. Please do not hesitate to contact us if you require any support or further information in this area.
