No Damages for Trade Mark Infringement Without Proved Loss: Iniuria Sine Damno Applied in Scots IP Litigation

1) Introduction

In McCandlish Farmhouse Confectionery Ltd against Michael Malone and another [2026] CSOH 85, the Outer House (Lord Sandison) dealt with a long-running dispute concerning the use of the name “Chelsea Whoppers” for a cocoa-dusted, fudge-like confectionery product. The pursuers (a family-run confectionery business and an additional co-proprietor of the relevant marks) alleged trade mark infringement and passing off against the first defender (a sole trader confectionery producer). The second defender was sued principally because she had created a basic promotional Facebook page for the first defender’s business.

The key issues were:

  • whether the defenders’ branding and wording infringed either of two UK registered trade marks;
  • whether the pursuers proved the elements of passing off (goodwill, misrepresentation, and damage);
  • whether the pursuers proved any compensable loss (damages) attributable to infringement;
  • title to sue (given late/unclear recording and proof of assignment);
  • prescription (including reliance on section 6(4) of the Prescription and Limitation (Scotland) Act 1973);
  • the second defender’s personal involvement and potential liability;
  • case management and proportionality in an IP dispute where the damages claim appeared inflated and evidentially unsupported.

2) Summary of the Judgment

  • Passing off: failed. The pursuers did not prove material goodwill in their product, nor adequate evidence supporting likely deception/confusion.
  • Trade mark infringement:
    • No infringement found in respect of the earlier “get-up”/device mark (UK00002422970), largely due to insufficient proof that the first defender’s presentation crossed the threshold of actionable similarity in context.
    • Infringement found in respect of the later word mark UK00003429251 (registered for “Chelsea Chocolate Flavoured WHOPPERS”), by the first defender’s use of “The Original Chelsea Cocoa Dusted Chocolate Fudge Whoppers” until 1 May 2026. The court granted declarator to that limited extent.
  • Interdict: refused. The first defender’s court undertaking not to use “Chelsea” or “Whopper” for confectionery removed any reasonable apprehension of future infringement.
  • Damages: refused in full. The court held that, under Scots law, nominal damages are not awarded absent proof of loss (iniuria sine damno), and the pursuers failed to prove any quantifiable loss caused by the infringement.
  • Second defender: assoilzied from all conclusions; her limited acts (Facebook placeholder and one phone call) were not “use in the course of trade” infringing a mark.
  • Expenses:
    • No expenses due as between the pursuers and the first defender (reflecting limited infringement but disproportionate pursuit).
    • The first pursuer (and later both pursuers) liable to the second defender on an agent and client, client paying basis, given the unreasonableness of suing her.

3) Analysis

3.1 Precedents Cited

(a) Proportional case management in IP disputes

Lord Sandison expressly drew on English IP case-management practice to justify robust timetabling and refusal to permit late attempts to rebuild a case on quantum:

  • Reed Executive Plc v Reed Business Information Ltd [2004] EWCA Civ 159, [2004] RPC 40
  • Lifestyle Equities CV v Amazon UK Services Ltd [2022] EWCA Civ 552; [2023] Bus LR 1010

These authorities were not applied as binding statements of Scots procedure, but as persuasive exemplars of proportionate, streamlined IP litigation. Their influence is visible in (i) the court’s insistence on early disclosure of witnesses and expert evidence, (ii) refusal to discharge proof to allow late quantification work, and (iii) focus on whether the pleaded damages case had any evidential foundation at all.

(b) The evidential significance of absence of actual confusion

For passing off (and, by analogy, the confusion question within trade mark infringement), the court relied on:

  • Neutrogena Corp v Golden Ltd (t/a Garnier) [1996] RPC 473

Applying Jacob J’s observation that where the case is “marginal” an absence of evidence of actual confusion may be decisive, Lord Sandison treated the paucity of independent evidence as fatal. This was especially so given the historical/evocative nature of the “Chelsea” theme, making some overlap in militaristic imagery unsurprising and reducing the probative weight of “similarity” arguments without corroborative marketplace evidence.

(c) Damages in Scots law: no nominal damages without proved loss

On damages, the court treated loss (damnum) as essential and rejected nominal damages:

  • Aarons & Co Ltd v Fraser 1934 SC 137 at 143, 1934 SLT 125 at 128
  • Wilkie v Brown 2003 SC 573 at [21]

This is the judgment’s sharpest doctrinal statement: even where infringement is established (and declarator granted), damages are not automatic and are not awarded merely to vindicate a right. In a trade mark context, the pursuer must still prove an award “necessary to put him in the same position as he would have been in had the infringement not taken place”.

3.2 Legal Reasoning

(a) Passing off: goodwill and misrepresentation were not proved

The pursuers’ evidence was largely internal (family, friends, former employees). The court held there was:

  • no satisfactory proof of material goodwill attaching to the pursuers’ product as distinct from general consumer interest in the product type; and
  • no reliable evidence of confusion from consumers/retailers (and the promised “survey evidence” never materialised).

The court emphasised that a party’s choice not to call third-party evidence (e.g., retailers) for relationship reasons cannot substitute for proof. The result was absolvitor on passing off.

(b) Trade mark infringement: device/get-up mark contrasted with word mark

The infringement analysis separated the earlier registered device/get-up mark from the later word mark:

  • For UK00002422970, Lord Sandison was not persuaded that the first defender’s then packaging met the required level of similarity to infringe, especially in the absence of actual confusion evidence and given contextual expectations (military allusions consistent with the product’s origin story).
  • For UK00003429251 (the words “Chelsea Chocolate Flavoured WHOPPERS”), the first defender’s wording was sufficiently close to constitute infringement until the court undertaking on 1 May 2026. Declarator was therefore appropriate.

(c) Interdict and undertakings

The court refused permanent interdict because an undertaking was already in place and there was no reasonable apprehension of repetition. The judgment underscores a practical remedial hierarchy: where the risk is controlled by a binding undertaking, interdict is not granted merely because a right was infringed historically.

(d) Damages: proof of causation and quantification was absent

The court identified the kinds of loss that might, in principle, be recoverable (lost sales, price suppression, reputational harm/remedial costs, or notional royalty where licensing is plausible). But the pursuers:

  • elected to seek damages rather than an account of profits;
  • did not prove market confusion or substitution (no presumption that the first defender’s sales would have been the pursuers’ sales);
  • led no credible evidence of “brand dilution”, “reputational erosion”, or rebranding costs;
  • presented limited internal system documents that were not proved for accuracy and did not support the pleaded narrative.

Accordingly, even though infringement of the word mark was declared, the claim failed for want of proved loss; the court characterised the damages case as existing “in the AI realm only”.

(e) Title to sue: the best evidence problem

Although the court accepted that the Trade Marks Act 1994 can permit an unregistered assignee to sue (given statutory language referring to “proprietor” rather than “registered proprietor”), it stressed that where the pursuer is not relying on the register, title must be proved by the best evidence. The pursuers asserted a written 2020 assignment but did not produce it at proof. The court therefore treated remedies as restricted to the period after the later recordal/application steps in 2026.

(f) Prescription: section 6(4) of the 1973 Act not engaged

The pursuers invoked section 6(4) on the basis of alleged misrepresentations about the effect of earlier sheriff court litigation. The court rejected this:

  • no specific actionable representation was proved (and the broad claim “I won and continued trading” was not shown to be false in any relevant way);
  • the story was inconsistent with the pursuers’ own years-long conduct trying to stop retail sales and involve Trading Standards;
  • reasonable diligence would have allowed the earlier case’s outcome to be checked long before 2025.

The court also noted the limited practical relevance: the later word mark dates from 2019 and service occurred in March 2026, making any prescriptive bar relatively short in time.

(g) The second defender: “use in the course of trade” requires more than incidental assistance

The court accepted that the second defender’s role was limited to a basic Facebook page and one phone call redirecting a query to the first defender. That did not amount to trade mark “use in the course of trade” under section 10 of the 1994 Act. The judgment signals that joining peripheral individuals (without evidence of trading, control, or substantive participation) risks absolvitor and adverse expenses.

3.3 Impact

  • Damages discipline in Scots IP cases: The judgment powerfully restates that infringement does not entitle a pursuer to damages without proof of loss; iniuria sine damno is not a route to nominal damages in Scotland. In practice, pursuers may need to consider (and properly evidence) alternative remedial models—such as an account of profits where appropriate—rather than asserting large figures without causal proof.
  • Evidence over assertion (including AI-assisted pleadings): The court’s repeated emphasis that pleadings—however polished—cannot replace proof is likely to influence how litigants and advisers approach AI-assisted drafting. If AI is used to formulate heads of loss (brand dilution, re-education, survey evidence), parties must still produce admissible, reliable evidence.
  • Passing off requires independent market proof in marginal cases: Where similarity is arguable rather than obvious, the absence of actual confusion evidence (consumer, retailer, or properly designed survey) may be decisive, consistent with Neutrogena Corp v Golden Ltd (t/a Garnier) [1996] RPC 473.
  • Proportionality and case management: By referencing Reed Executive Plc v Reed Business Information Ltd and Lifestyle Equities CV v Amazon UK Services Ltd, the court endorsed firm timetabling and resisted late attempts to reshape quantification. This points to a more interventionist approach in Scottish IP procedure where claims appear disproportionate or evidentially hollow.
  • Litigation targeting: Suing peripheral individuals (e.g., for incidental social media help) without a sound evidential foundation can produce adverse expenses consequences on an enhanced basis.

4) Complex Concepts Simplified

  • Passing off: A “common law” protection of business goodwill. A pursuer must prove (i) goodwill in the relevant market, (ii) misrepresentation likely to deceive, and (iii) resulting damage.
  • Trade mark infringement: A “statutory” claim based on registered rights. Goodwill is not required, but the pursuer must show infringing “use in the course of trade” and, for damages, must still prove actual loss caused by that infringement.
  • Declarator: A court declaration determining legal rights (here, that infringement occurred) without necessarily granting money or prohibitory orders.
  • Interdict vs undertaking: Interdict is a court order prohibiting conduct. An undertaking is a binding promise to the court; if it adequately removes the risk of repetition, interdict may be unnecessary.
  • Iniuria sine damno: “A wrong without loss.” Scots law generally does not award damages where loss is not proved (and the court here rejected nominal damages for infringement without loss).
  • Section 6(4) of the 1973 Act (prescription): Can postpone prescription where error is induced by another’s act/omission, but only while the creditor could not with reasonable diligence have discovered the error.

5) Conclusion

McCandlish Farmhouse Confectionery Ltd against Michael Malone and another [2026] CSOH 85 is a pointed reminder that Scottish IP litigation is evidence-driven: polished pleadings, ambitious heads of loss, and repeated assertions of confusion do not establish goodwill, deception, causation, or quantifiable loss. The judgment’s most significant contribution is its firm application of Scots damages principle to trade mark infringement: absent proof of loss, damages are not awarded (not even nominally), even where infringement is proved and declarator granted. Combined with robust case management and a clear warning against over-inclusive defendant selection, the decision is likely to be cited as a practical benchmark for proportionality, proof, and remedial discipline in Scottish trade mark disputes.