Trade Marks

Comparative Advertising

Jane Lambert
June 1997

This article first appeared on the Lancaster Building website

Under the old trade mark law comparative advertising was virtually impossible because of the breadth of s. 4 (1) (b) of the Trade Marks Act 1938 (see Bismag v Amblins [1940] Ch 667 and Montana v Villa Maria [1985] FSR 400). As Jacob J noted in Vodafone Group Plc v Orange Personal Communications Services Ltd. [1997] FSR 34, 39, the Trade Marks Act 1994 "now positively permits fair comparative advertising by s.10 (6)" in that it provides that nothing shall be construed as preventing the use of a registered trade mark by any person for the purpose of identifying goods or services as those of the proprietor or licensee. However, this provision is qualified by the further words

"any such use otherwise than in accordance with honest practices in industrial or commercial matters shall be treated as infringing the registered trade mark if the use without due cause takes unfair advantage of, or is detrimental to, the distinctive character or repute of the trade mark."

Vodafone
In Vodafone the plaintiff complained that the defendant's advertising slogan that its subscribers saved an average of £20 per month was untrue and that the defendant's reference to its service infringed its mark. Jacob J agreed at page 40 that if the slogan were misleading there would have been an infringement. On the evidence before him, however, the judge found that the slogan was not misleading as some savings would be made from using the defendant's service on any basis. The plaintiff's action, which had been framed in malicious falsehood and trademark infringement, therefore failed.

BT v AT & T
A motion seeking similar relief came before Michael Crystal QC in British Telecommunications Plc v A T & T Communications (UK) Ltd. [1997] 5 EIPR D-134. The deputy judge reviewed Barclays Bank Plc v RBS Advanta [1996] RPC 307 and Vodafone Group Plc v Orange Personal Communications Ltd. and distilled the following principles:

	the primary objective of s.10 (6) of the 1994 Act is to permit comparative advertising (Advanta at page 312 and Vodafone at page 39);
	so long as the reference to a competitor's marks is honest there is nothing wrong in telling the public of the relative merits of competing goods or services and using registered marks to identify them (ibid);
	the onus is on the registered proprietor to show that factors in the proviso to s. 10 (6) exist (ibid);
	there will be no infringement unless the use of the mark is not in accordance with honest practices (Advanta);
	the test is objective: would a reasonable reader say on being given the full facts that the advertisement is not honest (Advanta and Vodafone);
	statutory or industry codes of practice do not necessarily help to determine whether an advertisement is honest for the purposes of s.10 (6) (Advanta);
	the general public are used to advertising and expect hyperbole (Advanta and Vodafone);
	the Trade Marks Act 1994 does not require the courts to impose a puritanical standard in the regulation of advertising (ibid); and
	advertising that is significantly misleading would not be honest for the purposes of s.10 (6) (ibid).

He added that the advertisement should be considered as a whole, that words in an advertisement should not be considered to be misleading unless on a fair reading in the context of the advertisement they can really be held to justify such a description and that as a reader would not scrutinize the advertisement in microscopic detail neither should the court. Although freedom of speech was not a reason for refusing an injunction on a trade mark motion (The Gallup Organisation Ltd. v Gallup Organisation Ltd. (1995) unreported 29 Nov) - as it may be in a malicious falsehood application (Bestobel Paints Ltd. v Bigg [1975] FSR 421) - he considered that it was a factor to be taken into account in the exercise of his discretion. Finding that the defendant's advertising would be understood as promising only "bottom line savings" for which there was evidence, and that the defendant would suffer real irreparable damage if the relief were granted whereas the plaintiff would not if it were refused, the learned deputy judge declined to grant an interlocutory injunction.

Legislation Jane Lambert The Trade Marks Act 1994 25 Feb 2004 Jane Lambert Community Trade Marks 9 April 2003							Legislation First Trade Marks Directive Community Trade Mark Regulation Trade Marks Act 1994