Deputy High Court Judge Nicholas Caddick KC has ruled that a company that marketed and sold modified AGA range cookers infringed six of AGA’s trade marks in a July 2024 judgment in the UK's IP Enterprise Court (IPEC).
The defendants, UK Innovations Group Limited and its director, developed an electric control system that could be fitted to AGA cookers to convert them to running on electricity. The complaint related to the company's marketing and sale of 26 AGA cookers fitted with this control system.
Commercial connection between the original and retrofitted products
In his judgment, Deputy Judge Caddick found that the first defendant’s offer on its website to “Buy an eControl AGA” created the impression that there was a commercial connection between the retrofitted products and AGA.
AGA therefore had legitimate reasons to object. Explaining his finding, the judge said the statements on the first defendant’s website:
“taken as a whole were likely to give customers the impression that what they were being offered was an AGA product (an eControl AGA, one of a range of AGA products) and this was something about which the Claimant could legitimately object. In this regard, the reference to the ‘eControl AGA’ was likely to be seen, not as descriptive (or not as purely descriptive) but rather as part of the brand for the product being offered for sale.”
In addition, the first defendant’s references to its eControl System “were likely to be taken as references to a system that was connected with the Claimant”. The judge concluded:
“Accordingly, whilst … I do not think that the Claimant had legitimate reasons to object to the Defendants selling AGA Cookers which they had refurbished and fitted with the eControl System, I find that it did have legitimate reasons to object to the way in which the Defendants went about marketing and selling these cookers. In my judgment, in this context, the interests of the Claimant as a trade mark proprietor outweigh the interests of people (such as the Defendants) dealing with the cookers in the aftermarket.”
The judge therefore rejected the defendant’s argument that they had a defence to the trade mark claims based on section 12 of the Trade Marks Act 1994 (the exhaustion defence).
He also found that the defendants’ use of the AGA marks was not descriptive use that fell within section 11(2) of the Act. He said:
“the implication in phrases such as ‘eControl AGA’, ‘AGA Cooker eControl’ or ‘Controllable Aga Cookers’ was not that the Defendants' own eControl System could be fitted to an AGA Cooker. Rather it was distinctive use; use as part of a badge of origin. It was use that suggested that the eControl Cookers and the eControl System were associated with the Claimant as the proprietor of the AGA Word Marks.”
2D and 3D marks
As part of its case, AGA asserted a two-dimensional line drawing trade mark and a three-dimensional trade mark (pictured below).
The judge rejected the defendants' argument that these marks were not infringed, saying that the defendant had used the images as trade marks, there was sufficient similarity and a disclaimer in the trade mark registration did not exclude the monopoly. He was therefore satisfied that there was a likelihood of confusion.
He also rejected attacks on the validity of both marks, saying they were sufficiently clear and precise. In the case of the 3D mark, he said it did not consist exclusively of characteristics that resulted from the nature of the goods (cookers) or were necessary to obtain a technical result.
Section 10(3)
On the final trade mark issue, infringement under section 10(3) of the Act, the judge found that the claimant had a very considerable reputation in relation to the AGA marks. He concluded:
“Whilst … I do not think that the Defendants' activities were detrimental to the repute of the Claimant's Marks, I am satisfied that those activities were detrimental to and took unfair advantage of the distinctive character of those Marks and that they were without due cause within the meaning of s.10(3).”
Copyright
The judge rejected AGA’s claim that the defendants infringed copyright in its CAD drawing for a control panel.
He found that copyright did subsist in the drawing and the defendants indirectly infringed it by copying the control panel. However, it fell under section 51of the CDPA 1988, which provides that it is not an infringement of copyright in a design document or model recording or embodying a design for anything other than an artistic work or a typeface to make an article to the design or to copy an article made to the design. In summary, the judge:
“copyright subsisted in the drawing as an artistic work. However, because that drawing was a design document for something (the control panel) which was not an artistic work, s.51 operates. Accordingly, it was not an infringement of copyright in the drawing for the Defendants to make control panels to the design recorded in that drawing.”
He decided the section 51 issue “simply on the basis of its own wording” and declined the opportunity to address the impact of the CJEU judgment in Cofemel.
Joint tortfeasance
Following the recent Supreme Court ruling in Lifestyle Equities (discussed here), the judge concluded that the first defendant’s director Michael McGinley did not know or have reason to believe:
“that the Defendants' activities were liable to affect the origin function of the Claimant's Marks, let alone that they gave rise to a likelihood of confusion, nor that the Defendants' activities would be detrimental to the reputation or distinctive character of the Claimant's Marks”.
The director was therefore not a joint tortfeasor.
What does this mean?
This is a detailed judgment that addresses a wide range of issues. It was particularly interesting to consider the discussion of trade mark exhaustion in relation to retrofitted products. This issue will no doubt become increasingly important in the context of both sustainability and the green energy transition. As the judge noted, this was not an easy matter to decide and he was aware that the decision has important implications for a wide variety of products and services.
Although the defendants were not successful, the judge was clear that there was a legitimate aftermarket in the refurbishment and resale of AGA cookers. The problem for the defendants was that the way they marketed and sold the eControl Cookers infringed the trade marks. It does not follow that all retrofitted products will infringe an original product's trade marks.
The case illustrates how finely balanced the arguments are in such cases. If you sell or are thinking of re-selling pre loved or upcycled branded products, including retrofitted products, please get in touch.
To find out more about the issues raised in this blog contact Rosie Burbidge, Intellectual Property Partner at Gunnercooke LLP in London - rosie.burbidge@gunnercooke.com