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Court of Appeal upholds trade mark infringement finding against use of VAGISAN and DR WOLFF's VAGISAN

Posted on 3 January 2023

Dr Wolff has been unsuccessful in its appeal against a 2021 High Court decision, which had found that its use of the sign VAGISAN, and also DR WOLFF's VAGISAN, infringed the Claimants' trade mark VAGISIL on the grounds of likelihood of confusion. While the Court of Appeal upheld the finding of infringement, the decision also deals with a number of interesting questions relating to rules relating to statutory acquiescence under which a trade mark owner has a five-year window in which to oppose the continuous use of a later registered trade mark. The Court of Appeal considered the approach taken by the European Court of  Justice (CJEU), as developed in a series of judgments resulting in its most recent decision in Heitec AG v Heitech Promotion GmbH in May 2022 (as this decision was not retained EU law, it was not binding on the Court but, given its direct relevance, the Court paid it close attention).

In appealing the High Court's decision, Dr Wolff attempted to rely on a number of defences: that (i) the Claimants had acquiesced to Dr Wolff's use of its later EU trade mark for VAGISAN and (ii) Dr Wolff's use of the later VAGISAN trade mark registrations did not infringe the Claimants' registration for the VAGISIL mark as Dr Wolff's later registered trade marks would not be declared invalid.  Additionally, whilst Dr Wolff conceded that VAGISAN was an infringement, it argued that the rebrand to DR WOLFF'S VAGISAN sign did not give rise to a likelihood of confusion.

During the appeal, the Claimants conceded that Dr Wolff had a defence to infringement for its use of the VAGISAN mark prior to January 2019, but otherwise maintained its claim for infringement.

Background

We wrote about the background to the dispute and the High Court decision in our January 2022 report. The Claimants' group (Combe International) is a global retailer of non-prescription female intimate healthcare products in the UK and worldwide, marketed and sold under the brand VAGISIL. The Claimants first registered VAGISIL as a UK trade mark in 1975 and VAGISIL products have been available on the UK market since 1984.

Dr Wolff is a German pharmaceutical company. In the early 2000s, it developed VAGISAN Moist Cream, which was first launched in Germany and later expanded into other territories. In 2012, it applied for an international trade mark designating the EU and US for the word mark VAGISAN. Following an opposition by Combe International, the parties entered into co-existence negotiations but failed to come to a settlement and cancellation proceedings were subsequently commenced in a number of jurisdictions.

In 2016, Dr Wolff sought to increase its UK presence, and VAGISAN products began to be sold in Boots stores. It also invested in a television advertising campaign, which saw an increase in sales of both products. The Claimants subsequently claimed for infringement in the UK in 2019. In 2022 Dr Wolff started to rebrand its products in the UK as DR WOLFF'S VAGISAN.

In light of the nature of the products, together with considerable evidence of actual consumer confusion between the competing signs, the High Court concluded that there was a risk of confusion between VAGISIL and VAGISAN, and also with DR WOLFF's VAGISAN.

Court of Appeal Decision

The Court of Appeal largely dismissed Dr Wolff's appeal, confirming both VAGISAN and DR WOLFF's VAGISAN infringed the VAGISIL marks. Whilst, as explained below, the Court of Appeal disagreed with the High Court's approach to interruption of the statutory acquiescence period, the Court of Appeal still upheld the infringement ruling because the Claimants were unaware of Dr Wolff's use of VAGISAN for a long period during 2015 and 2016 despite keeping a watch for such use.

Had the Claimants acquiesced in the use of Dr Wolff's' VAGISAN mark for a continuous period of five years?

It was common ground that the Claimants had become aware of the VAGISAN products being sold in the UK in January 2014. However, Dr Wolff argued that, since the Claimants did not bring infringement proceedings until 2019, over five years later, they had acquiesced in its use of the VAGISAN mark, and therefore could not oppose that use under section 48(1) of the Trade Marks Act 1994 which provides a defence of statutory acquiescence in such circumstances.

Assessment of the statutory acquiescence defence required the Court of Appeal to consider a number of key issues. While the High Court had held that the Claimants' issuing of cancellation proceedings against the VAGISAN mark was enough to interrupt the acquiescence period, the Court of Appeal disagreed. Applying the approach set out in Heitec AG v Heitech Promotion GmbH, Arnold LJ (giving the leading judgment) noted, in particular, that cancellation proceedings attack the registration of a trade mark, rather than its use. Since trade mark use could only be opposed through infringement proceedings, an administrative action would not in itself necessarily restrain infringement (an example of one that might would be use of applicable customs procedures).

A further issue was whether Dr Wolff had made use of the VAGISAN mark in the UK for the relevant period. This required that there be continued, but not necessarily continuous, use of the later trade mark throughout the five-year period, which was essentially a fact-sensitive question; and that such use was use which infringed the trade mark. Dr Wolff had made use of the VAGISAN sign on its website and through its distribution network together with sales of 498 units of the VAGISAN product across the relevant period. Whilst the Claimants had argued this was de minimis use, the Court of Appeal saw it as use on a scale which a vigilant trade mark owner could be expected to oppose.

However, on the last point in assessing the statutory acquiescence defence, the Court of Appeal upheld the High Court's finding that, due to the Claimants' lack of awareness of Dr Wolff's infringing use for a long period during 2015 and 2016, it was reasonable to assume Dr Wolff had withdrawn from the UK market.  Accordingly, the outcome was a finding that the Claimants did not acquiesce in Dr Wolff's use of the VAGISAN mark that occurred during that period.

Did the later trade mark registrations for VAGISAN infringe the VAGISIL registration?

Trade mark law provides that a registered trade mark is not infringed by the use of a later trade mark registration, where the later registered trade mark would not be declared invalid.

The High Court rejected Dr Wolff's reliance on this defence on the grounds that there had been no acquiescence by the Claimants in the use of the VAGISAN mark in the UK, and therefore VAGISAN was not a trade mark which would not be declared invalid. On appeal, the Court of Appeal allowed Dr Wolff to rely on an earlier version of this defence which applied prior to 14 January 2019.

Did the DR WOLFF'S VAGISAN sign give rise to likelihood of confusion?

The Court of Appeal affirmed the finding that use of the DR WOLFF'S VAGISAN sign, as well as of VAGISAN, gave rise of a likelihood of confusion. The trial judge had correctly compared the sign DR WOLFF'S VAGISAN with VAGISIL and recognised that it was a composite sign consisting of two elements, DR WOLFF'S and VAGISAN, noting the similarities between VAGISAN and VAGISIL. Further, the "rule of thumb" principle that consumers pay most attention to the beginning of a trade mark was not relevant in the circumstances. While 'DR NAME' signs were commonly used as house marks, the VAGISAN element played an independent distinctive role in the composite sign. Although DR WOLFF'S was not a well-known sign to the average consumer in the UK, this did not eliminate the likelihood of confusion arising from the independent distinctive role of VAGISAN.

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