Introduction

Walton International Ltd & Anor v. Verweij Fashion BV ([2018] EWHC 1608 (Ch)) is a landmark case adjudicated in the England and Wales High Court (Chancery Division). The dispute revolves around the use of the trade mark "GIORDANO" for clothing, where both parties claimed rights to the mark in different jurisdictions. The Claimants, Walton International Limited and its subsidiary, assert that the Defendant, Verweij Fashion BV, has infringed upon their numerous UK and EU trade mark registrations by using the "GIORDANO" mark without authorization.

The core issues in this case include the validity of the Claimants' trade marks based on non-use, the Defendant's counterclaims regarding revocation and invalidity, and the intricate questions of subject-matter jurisdiction under European law. This case is part of a broader conflict involving around 60 trade mark disputes across Europe between the parties.

Summary of the Judgment

Justice Arnold delivered a comprehensive judgment addressing multiple facets of trade mark law. The High Court concluded that most of the Claimants' trade marks should be revoked due to non-use within the stipulated five-year periods following their registration dates. Specifically:

• UK864, UK398, and EU651 (Classes 25 and 35) were revoked as the Claimants failed to demonstrate genuine use within the relevant periods.
• UK444 and EU044 (Class 14) were also revoked due to lack of genuine use and failure to demonstrate valid use in the form required by the trade mark registrations.
• EU150 (Class 9) was similarly revoked for non-use.
• UK297 was invalidated not due to bad faith, but on relative grounds, reinforcing the principles surrounding relative invalidity of trade marks.

Additionally, the Defendant's counterclaim for passing off was upheld, indicating that the Claimants' use of the "GIORDANO" mark amounted to passing off, thereby infringing on the Defendant's rights.

Analysis

Precedents Cited

The judgment extensively references key trade mark cases that have shaped the legal landscape:

• Adobe Systems Inc v Netcom Distributors: Addressed subject-matter jurisdiction, clarifying when courts can entertain revocation counterclaims.
• Specsavers International Healthcare Ltd v Asda Stores Ltd: Discussed the separation of word and figurative elements in trade marks.
• Merck KGaA v Merck Sharp & Dohme Corp: Established criteria for determining whether online trade mark use is targeted at specific jurisdictions.
• Leno Merken BV v Hagelkruis Beheer BV: Explored genuine use and the functions of trade marks.
• Victoria Plum Ltd v Victorian Plumbing Ltd: Examined the criteria for honest concurrent use in trade mark disputes.

These precedents provided a foundational understanding for interpreting trade mark use, genuine use, and jurisdictional boundaries, influencing the court's decision in Walton v. Verweij.

Legal Reasoning

The court's legal reasoning centered on the principles of genuine use and relative invalidity:

• Genuine Use: The court assessed whether the Claimants genuinely used their trade marks in connection with the registered goods or services. It was determined that the online and offline uses by the Claimants did not target the UK or EU markets effectively, primarily utilizing global platforms like a global e-shop and AliExpress without significant engagement in the relevant jurisdictions.
• Relative Invalidity: For UK297, the Defendant argued relative invalidity, asserting that the Claimants' use amounted to passing off. The court found that the Defendant had established honest concurrent use, meaning that the Defendant's prior and continued use of the "GIORDANO" mark did not negatively impact the trade mark's function as a guarantee of origin.
• Subject-Matter Jurisdiction: The court examined whether it had the jurisdiction to hear the counterclaims regarding EU trade marks. Referencing Adobe v Netcom, the court concluded that despite the Claimants attempting to discontinue the wider infringement claims, it retained jurisdiction over the counterclaims pertaining to EU trade marks.

The court meticulously analyzed each trade mark application, considering the nature, scale, and target of the use, ultimately determining that the Claimants did not meet the thresholds for genuine use required for maintaining their registrations.

Impact

This judgment has significant implications for trade mark holders and businesses operating in multiple jurisdictions:

• Enforcement of Genuine Use: Emphasizes the necessity for trade mark proprietors to actively use their marks within the relevant territories to maintain their registrations.
• Cross-Jurisdictional Considerations: Highlights the complexities of operating trade marks across different jurisdictions and the importance of understanding regional use requirements.
• Honest Concurrent Use: Reinforces the conditions under which honest concurrent use can defend against claims of infringement, providing clarity on the balance between competing trade mark rights.
• Revocation for Non-Use: Serves as a precedent for revoking trade marks that are not genuinely used, underscoring the court's role in preventing the abuse of trade mark registrations.

Organizations must now be more diligent in demonstrating genuine use and understanding the jurisdictional nuances to protect their trade mark rights effectively.

Complex Concepts Simplified

Genuine Use

Genuine use refers to the actual and consistent use of a trade mark by its proprietor in connection with the goods or services for which it is registered. This use must align with the trade mark's commercial purpose, serving as a guarantee of origin and distinguishing the goods or services from those of others.

Relative Invalidity

Relative invalidity occurs when a trade mark is considered invalid in the eyes of the court due to conflicts with earlier registered marks or rights. This can happen even if the trade mark holder has been using the mark amicably alongside others.

Subject-Matter Jurisdiction

Subject-matter jurisdiction refers to the court's authority to hear and decide on particular types of cases. In trade mark disputes involving multiple jurisdictions, it's crucial to determine which court has the authority to rule on specific aspects of the case.

Honest Concurrent Use

Honest concurrent use is a defense in trade mark law where two parties use identical or similar trade marks in good faith, without intending to deceive or infringe upon each other's rights. For this defense to hold, the use must not adversely affect the trade mark's function as a guarantee of origin.

Conclusion

The Walton International Ltd & Anor v. Verweij Fashion BV judgment underscores the critical importance of genuine use in maintaining trade mark registrations. By revoking multiple trade marks due to non-use, the High Court emphasizes that passive or misdirected use insufficiently fulfills the obligations of trade mark proprietors. Additionally, the invalidation of UK297 on relative grounds without evidence of bad faith sets a clear boundary for future trade mark applications and disputes. This case serves as an essential reminder for businesses to actively engage in the use of their trade marks within relevant jurisdictions and to be vigilant in monitoring and protecting their brand identities to avoid similar legal challenges.

The judgment not only clarifies several aspects of trade mark law but also reinforces the judiciary's role in ensuring that trade mark registrations are not exploited without genuine commercial intent. Moving forward, trade mark holders must prioritize genuine, targeted use of their marks and remain aware of the legal standards governing trade mark validity and enforcement.