Comparative advertising causes a stink in the Court of Appeal – much to the Judges' regret

Using a famous brand name to compare a characteristic of your otherwise legitimate copycat product (in this case, the smell) has today been held unlawful by Lord Justice Jacob, as the Court of Appeal found itself bound by the European Court of Justice's earlier ruling on trade mark and comparative advertising in the smell-alike perfume case L'Oreal v Bellure.

Key points

• The ability of advertisers to make comparisons to products protected by famous brands may be limited by a decision which effectively prevents certain truthful statements incorporating another's trade mark being made unless for "purely descriptive purposes", which would not include use in advertising.

• Therefore, most comparative adverts for "imitation" or "replica" products which replicate characteristics of well-known branded products (such as smell or taste) may now fall foul of trade mark law and breach the Comparative Advertising Directive.

• The judgment also appears to suggest that the effect of the ECJ's judgment on the meaning of "taking unfair advantage" of the reputation of a trade mark is potentially so broad so as to forbid any form of "free-riding", regardless of whether or not the brand owner has suffered any harm or whether there is evidence of any particular unfairness.

• The judgment highlights the very generous protection now afforded to well-known brand owners to clamp down on rival copycat products, look-alikes or supermarket own brand products.

• But the decision was made begrudgingly by the Court of Appeal, Jacob LJ delivering a scathing condemnation of the ECJ's approach, arguing it goes against free competition and free speech. He made clear he would have made the opposite decision if not constrained by European law, describing the effect of the decision as amounting "to a pointless monopoly. But my duty is to apply it". He has urged reform of the law.

• So whilst the decision is a powerful one for brand owners, appearing to give those with well-known brands significantly broader protection against the use of their trade marks in competitor's advertising, advertisers are likely to fight it, and it looks like they will have the support of at least one important member of the UK judiciary. European trade mark law is currently under review by the Max Planck Institute on behalf of the European Commission, which may well take note of Jacob LJ's passionate judgment.

This case was brought by L'Oréal, the owner of various fine perfume brand names like Trésor and Miracle, against Bellure and others, companies which produced smell-alike perfumes marketed in look-alike bottles and packaging. In order to inform retailers what its perfumes smelled like, the defendants deployed comparison lists which simply listed the L'Oréal brands besides the names of the corresponding smell-alikes. Asserting that its trade marks had been infringed, L'Oréal challenged the look-alike bottles and packaging, as well as the comparison lists. This appeal concerned only the particular comparison lists, which have now been found unlawful.

The case has been running since 2006 when it was heard in the UK High Court, after which the outcome was appealed to the Court of Appeal which referred certain questions of law to the ECJ. The ECJ's judgment was handed down in June last year, the results of the Court of Appeal's application of that judgment – effectively the final word – is what has been handed down today.

More details on the ECJ's earlier judgment can be found in our previous bulletin of 18 June 2009. The full judgment of the Court of Appeal can be found here.

We have also written in detail on this case in the Journal of Intellectual Property Law and Practice, our article (abstract here) having been cited with approval by Jacob LJ in his judgment.

 

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