“(…) Lord Justice Chadwick :
1. This is an appeal from an order made on 11 April 2002 by Mr J. L. in
trade mark proceedings brought by The P. A. Company Limited against
The P. I. Company of America. For convenience I will refer to the parties
respectively as “P. (UK)” and “P. (USA)”.
2. For well over one hundred years each of the parties has carried on
insurance business. They, and their respective group companies, now
offer a wide range of financial services. Although in competition, P. (USA)
has derived its business, principally, from the United States of America,
while P. (UK) has operated mainly in the United Kingdom and other
parts of Europe. Until recently, they had managed to co-exist without
undue conflict under arrangements made in 1974. Those arrangements
provided that P. (UK) would not use the “P.” name or mark in the United
States; and that P. (USA) would not use that name or mark in Europe
or in certain countries of the Commonwealth. P. (UK) asserts that the
arrangements constitute an agreement binding in law. P. (USA) accepts
that the arrangements were made; but denies that they were intended
to have, or do have, legal effect. That issue remains to be resolved in
these proceedings at a trial; but it is not before the Court on this appeal.
The issue on this appeal is whether – if the 1974 arrangements do not
have legal effect – P. (UK) should be permitted to argue at a trial that,
nevertheless, the use by P. (USA) of the mark “PR.” in Europe constitutes
trade mark infringement.
3. That issue arises in the circumstances that the marks “PRU” and “P.”
are registered both as Community trade marks under the Community
Trade Mark Regulation (Council Regulation 40/94/EEC) and as United
Kingdom trade marks under the Trade Marks Act 1994 or its predecessor,
the Trade Marks Act 1938. P. (UK) is the proprietor of those trade
marks. But P. (USA) has been successful in obtaining registration of
the mark “PR.” in a number of trade mark registries in Europe against
the opposition of P. (UK). Registration of that mark has been upheld on
appeal. P. (USA) relies, in particular, on the decision of the Cour d’Appel
in Paris to uphold the rejection, by the French Trade Marks Registry, of P.
(UK)’s opposition to registration of the mark “PR.” in France (Following the
completion of oral argument we have been told that registration of the PR.
mark in the Portugese Trade Marks Registry has been upheld by the Court
of Appeal in Lisbon.) . It is said, in effect, that P. (UK) cannot be allowed
to argue that an English court should reach an inconsistent result.
These proceedings
4. In these proceedings P. (UK) seeks to prevent P. (USA) from using the
marks “PR.” and “P.-BACHE” in the United Kingdom and other parts of
Europe. It claims to be entitled to do so, first, on the basis that such use
would be in breach of the 1974 agreement; and, second, on the basis that
such use would infringe its registered trade marks.
5. The proceedings were commenced by the issue of a claim form on
30 November 2001; permission having been obtained from Mr J. J.
on 23 November 2001, under CPR 6.20, to issue for service out of the
jurisdiction. P. (USA) acknowledged service, through its solicitors, on
27 December 2001; but, by notice dated 8 January 2002, applied to set
aside the order of 23 November 2001 and to strike out or stay the claims.
That application came before Mr J. L. on 6 and 7 March 2002. His written
judgment ([2002] EWHC 534 (Ch), [2002] IP&T 781) was handed down
on 11 April 2002.
6. The judge rejected the submission, made on behalf of P. (UK), that
the challenge to jurisdiction must fail on the ground that, by applying to
strike out the claims on substantive grounds, P. (USA) had submitted to
the jurisdiction. The effect of his decision on that point, as he recognised
at paragraph [20] of his judgment, was that, in order to uphold the
order of 23 November 2001, it was for P. (UK) to show that it had a good
arguable case in respect of the claims made. But, of course, if P. (UK)
could discharge that burden, it would succeed not only in upholding the
order for service out of the jurisdiction but also in its opposition to the
application to strike out the claims on substantive grounds.
7. The application by P. (USA) to strike out the claims was made on three
grounds: (i) that, having regard to the evidence before the court, there
was no arguable case for any legally binding contract between the parties;
(ii) that, in relation to alleged infringement by the use of the mark “PR.”,
the English court had no jurisdiction, or should decline to exercise any
jurisdiction which it might have; and (iii) that, in relation to alleged
infringement by the use of the mark “P.-BACHE”, there had been no use
by P. (USA) which was inconsistent with a consent to use given by P. (UK).
8. The judge was persuaded – although, as he said at paragraph [43] of
his judgment, “not without considerable misgivings” - that the contractual
claim advanced by P. (UK) on the basis of the 1974 agreement “was
sufficiently arguable to justify service out of the jurisdiction”. He was
satisfied, also, that he should not decide the contract issue as if on an
application for summary relief. As he said, this was just the sort of case
in which it would be unwise to embark on the “mini-trial” which would
be necessary to decide that issue. There is no appeal from the judge’s
decision on those points.
9. P. (USA) accepted before the judge that unauthorised use of the mark
“P.-BACHE” might well infringe rights conferred on P. (UK) as proprietor
of its registered marks, or some of those marks; but argued that the use
which P. (USA) was making of the “P.-BACHE” mark – that is to say, use
in connection with investment management services and, in particular,
in material on a web site “www.p.-bache.com" was use to which P. (UK)
had given consent. The judge took the view (at paragraph [86] of his
judgment) that the varied nature of the business in which P. (USA) was
and is involved was such that the borderline between those activities in
relation to which it was to be allowed to use the mark “P.-BACHE” and
those in relation to which consent had not been given was imprecise and
could not be determined on the correspondence before him. As he put it:
“the precise scope of the mutual permissions given by each to the other
is difficult to discern as is the question whether the activities advertised
in the P-US web site fall within any relevant permission from P-UK”. He
was in no doubt that that was not an issue which could be resolved in
summary proceedings. There is no appeal from the judge’s decision on
that point.
10. In the result - and as matters now stand – these proceedings will
go to trial in any event on the 1974 contract issue and on the question
whether the use of the mark “P.-BACHE” is within any relevant consent.
The issue yet to be determined is whether there should be a trial in
relation to alleged infringement by the use by P. (USA) of the mark “PR.”.
11. The contention advanced by P. (USA) before the judge, identified in
ground (ii) of the application to strike out, was that:
“. . . the Court either does not have jurisdiction, or should decline to
exercise any jurisdiction it may have pursuant to Article 21 of the Brussels
Convention on Jurisdiction and Enforcement of Judgments in Civil and
Commercial Matters and Article 105(2) and/or 105(3) of the Council
Regulation 40/94 on the Community Trade Mark and by means of estoppel
res judicata;”
The judge encapsulated his understanding of that contention in two
sentences at paragraph [46] of his judgment:
“In a nutshell, Mr S.’s argument [on behalf of P. (USA)] is that the
decision by the Cour d’Appel is binding in all States which are signatories
to the Brussels Convention and where the same issue of confusing
similarity arises. It follows that no infringement proceedings can be
brought anywhere because of the outcome in the French registration
proceedings.”
The judge rejected that contention. But he gave P. (USA) permission to
appeal to this Court.
The Community provisions as to jurisdiction in trade mark infringement
cases
12. The challenge is to the jurisdiction of the United Kingdom courts to
entertain, or to adjudicate upon, trade mark infringement proceedings.
It is important to keep in mind that P. (UK) alleges infringement (i) of its
Community trade marks (“CTMs”) – of which there are two – and (ii) of
its United Kingdom trade marks – of which there are seven. The judge
explained the difference between CTMs and national trade marks in a
passage, at paragraphs [51] and [52] of his judgment, which is not, I
think, contentious and which I gratefully adopt. After pointing out that
national trade marks are applied for and granted nationally – and that the
vast majority of registered trade marks are still national marks - he said
this ([2002] IP&T 781,797a-e):
“[51] . . . A large trader may well have the same, or substantially the
same, trade marks registered in numerous countries under national trade
mark laws. Infringement and validity of a national trade mark has to be
determined in the national court in accordance with national law. The
result is that where a trader is faced with an international trade which
he considers infringes his registered trade mark rights, he may need
to litigate in numerous countries (subject to the impact, if any, of the
Brussels Convention). Within the European Community the existence
of national intellectual property rights has always given rise to concern
for those anxious to advance the concept of a single homogeneous
market. In the area of registered trade marks, the creation of CTMs was
designed to offer a pan-European right which would gradually displace
the national registrations, although it is still permissible to apply for
and enforce the latter. CTMs are applied for and granted at the Office
for the Harmonisation of the Internal Market (OHIM) at Alicante. Once
granted, they are effective throughout the EC. They can be invalidated
either by revocation proceedings brought in OHIM or as a result of
a counterclaim for invalidity brought before a relevant court during
infringement proceedings. Their grant can also be opposed at OHIM.
[52] The issue of infringement could cause a problem. There is, as yet,
no Community court which can try trade mark infringement proceedings.
This means that infringement of CTMs has to be litigated through the
national courts of the member states. Clearly this raises the possibility of
multiple findings by different national courts in relation to the same act of
infringement of the same CTM in different countries. . . . ”
13. The judge then went on to examine the way in which the Community
Trade Mark Regulation (Council Regulation 40/94) (“the Regulation”)
sought to ensure that the possibility of multiple findings by different
national courts in relation to the same act of infringement of the same
CTM in different countries was avoided – so that the intended benefits of a
unitary trade mark right were achieved. He pointed out that each Member
State was required, by article 91 of the Regulation, to designate certain of
its national courts as “Community trade mark courts”; and that, by article
92, those courts were given exclusive jurisdiction for all infringement
actions relating to CTMs. As he put it (at paragraph [55] of his judgment):
“It is only the Community trade mark courts which can determine CTM
infringement proceedings”. He went on to say this, at paragraphs [59] and
[61] of his judgment ([2002] IP&T 781, 799a-g):
“59. . . . Article 94(1) stipulates that a Community trade mark court
shall have jurisdiction in respect of acts of infringement committed or
threatened within the territory of any member state of the Community.
Thus one national Community trade mark court can determine the
infringement action between the proprietor of the mark and the
alleged infringer in all member states. It is for this reason that the title
“Community trade mark court” is doubly appropriate. A national court
which is a Community trade mark court not only is given the jurisdiction
to deal with Community trade marks but, as between the parties before it,
can determine their rights throughout the Community.”
. . .
61. Gathering all these strands together and summarising them, we
can see that proceedings for infringement of CTMs must be brought
before Community trade mark courts of first instance and appeals go
to Community trade mark courts of second instance. In an action for
infringement brought before the Community trade mark court in one
member state, the court can determine the issue of infringement for all
member states. Similarly, if it invalidates a CTM, it is invalid throughout
the Community. By these provisions, a CTM can only be enforced against
a particular infringement in a single Community trade mark court, even if
the infringement takes place in a number of member states . . .”.
14. The provisions to which the judge referred – in particular, article
94(1) of the Regulation – address the need to avoid inconsistent findings
by different national courts (acting as Community trade mark courts)
in relation to the same acts of infringement of the same CTM. But they
leave untouched two other problems. The first is the need to avoid the
possibility that the benefits sought to be obtained by a unitary trade mark
right – that is to say the right conferred by registration of the mark as a
CTM under the Community Trade Mark Regulation – will be undermined
by co-existing rights under national trade marks, infringement of which
(absent some provision in Community legislation) would have to be
separately litigated in the several national courts; with the possibility
of inconsistent findings. The second is the need to avoid the possibility
of inconsistent findings where the mark has not been registered as a
CTM, but is the subject of registration in more than one national trade
mark registry; so that, again, the infringement of co-existing rights under
national trade marks would have to be separately litigated in the several
national courts. Article 105 of the Regulation addresses the first of those
problems. But the second is left to be dealt with (if at all) under the
Brussels Convention.
Article 105 of the Community Trade Mark Regulation
15. The judge identified the problem to which (as he thought) article
105 of the Community Trade Mark Regulation is directed in a passage at
paragraph [63] of his judgment ([2002] IP&T 781, 800a-b):
“. . . a mark may be registered as a CTM and thereby be effective
throughout the Community but it may be registered at the same time as a
national trade mark in, say, the UK, Germany and France. The draftsman
of the Regulation clearly considered that in such a case, and in the
absence of curative legislation, although the CTM could only be litigated in
one country, the infringement of the British, German and French national
trade marks had to be litigated in the British, German and French courts.
Thus the advantage sought to be obtained by the creation of CTMs would
be undermined in many cases. It was to avoid this problem that [the]
Regulation implemented Article 105.”
16. Article 105 is in Section 1 (Civil Actions on the basis of more than one
Trade Mark) of Title XI (Effects on the Laws of the Member States) of the
Regulation. It is in these terms:
Article 105
Simultaneous and successive civil actions on the basis of Community
trade marks and national trade marks
1. Where actions for infringement involving the same cause of action and
between the same parties are brought in the courts of different Member
States, one seized on the basis of a Community trade mark and the other
seized on the basis of a national trade mark
(a) the court other than the court first seized shall of its own motion
decline jurisdiction in favour of that court where the trade marks
concerned are identical and valid for identical goods or services. The court
which would be required to decline jurisdiction may stay its proceedings if
the jurisdiction of the other court is contested;
(b) the court other than the court first seized may stay its proceedings
where the trade marks concerned are identical and valid for similar goods
or services and where the trade marks concerned are similar and valid for
identical goods or services.
2. The court hearing an action for infringement on the basis of a
Community trade mark shall reject the action if a final judgment on the
merits has been given on the same cause of action and between the same
parties on the basis of an identical national trade mark valid for identical
goods or services.
3. The court hearing an action for infringement on the basis of a national
trade mark shall reject the action if a final judgment on the merits has
been given on the same cause of action and between the same parties on
the basis of an identical Community trade mark valid for identical goods
or services.
17. As the judge pointed out, paragraph 1 of article 105 of the Regulation
applies in cases where there are concurrent (or simultaneous) actions
for trade mark infringement; paragraphs 2 and 3 apply where actions for
trade mark infringement are sequential (or successive). Further, it is clear
that paragraphs 2 and 3 apply only in cases where, if the actions for trade
mark infringement had been concurrent and not consecutive, they would
have fallen within sub-paragraph (a) of paragraph 1 – that is to say, in
“dual identity” cases. Paragraphs 2 and 3 do not apply in cases (within
sub-paragraph (b) of paragraph 1) where there is not identity both of the
trade marks and of the goods or services for which the trade marks are
valid. The distinction between cases in which there is dual identity and
cases in which there is similarity (but not dual identity) reflects the levels
of protection conferred by article 5(1)(a) and (b) of the First Council
Directive of 21 December 1988 (89/104/EEC) – to which the laws of
Member States in relation to trade marks are required to approximate.
18. What is less clear, as a matter of first impression, is whether
paragraphs 2 and 3 of article 105 also apply where the “final judgment
on the merits” has been given in proceedings other than an action for
trade mark infringement. In particular, it is less clear, on first impression,
whether those paragraphs can have any application where the final
judgment on the merits has been given in proceedings for a declaration
of invalidity; or in proceedings for registration of the trade mark, as
in the present case. That is a question to which I shall need to return.
But, whatever the answer to that question, it is plain that article 105
applies only where one of the actions or proceedings involves a CTM. In
cases where a CTM is not involved – or has not been involved in earlier
proceedings between the same parties – article 105 of the Regulation can
have no application.
The Brussels Convention
19. As I have said, where the mark has not been registered as a CTM,
but is the subject of registration in more than one national trade mark
registry, the need to avoid the possibility of inconsistent findings in
the national courts is not addressed by any of the provisions in Article
105 of the Community Trade Mark Regulation. It is, I think, common
ground that, if that need is addressed at all by Community legislation, the
relevant provisions must be found in the Brussels Convention. I should
note, for completeness, that although, from March 2002, the Brussels
Convention has been replaced by Council Regulation (EC) 44/2001 neither
party has suggested that the provisions of Regulation 44/2001 differ in
any material respect from the relevant provisions of the Convention.
20. The object of the 1968 Brussels Convention on Jurisdiction and
the Enforcement of Judgments in Civil and Commercial Matters (“the
Convention”), as its preamble makes plain, is “to determine the
international jurisdiction of [the courts of the Contracting States], to
facilitate recognition and to introduce an expeditious procedure for
securing the enforcement of judgments, authentic instruments and court
settlements”. Title II is concerned with jurisdiction. The basic rule, in
matters to which the Convention applies, is that persons domiciled in
a Contracting State are to be sued in the courts of that State – article
2; but that basic rule is subject to exceptions. For present purposes
the relevant exception is that, in relation to proceedings which fall
within article 16 (at Section 5 of Title II), certain courts have exclusive
jurisdiction, regardless of domicile. In respect of defendants not domiciled
in a Contracting State, the jurisdiction of the courts of each Contracting
State shall be determined by the law of that State – article 4; but that
rule, also, is subject to the provisions of article 16. Article 16 is in these
terms, so far as material:
Article 16
The following courts shall have exclusive jurisdiction, regardless of
domicile –
. . .
4. In proceedings concerned with the registration or validity of patents,
trade marks, designs, or other similar rights required to be deposited or
registered, the courts of the Contracting State in which the deposit or
registration has been applied for, has taken place or is under the terms of
an international convention deemed to have taken place.
21. The importance of article 16(4) of the Convention, in the present
context, is that in many proceedings for the infringement of a national
trade mark - as well as in all proceedings concerned with registration or
(solely) with validity - it will have the effect that the court of the State
in whose registry the national trade mark is registered has exclusive
jurisdiction. That is because in many proceedings for infringement,
validity will be put in issue. A claim for infringement will be met by the
riposte that the trade mark is invalid. In such a case the court in which
infringement proceedings have been commenced (if not a court of the
State in whose registry the national trade mark has been registered) must
refuse jurisdiction. It is required to do so by article 19 of the Convention:
Article 19
Where a court of a Contracting State is seized of a claim which is
principally concerned with a matter over which the courts of another
Contracting State have exclusive jurisdiction by virtue of Article 16, it
shall declare of its own motion that it has no jurisdiction.
The point was addressed by Mr J. L. – in the context of proceedings
for the infringement of patents – in Coin Controls Limited v Suzo
International (UK) Limited and others [1997] FSR 660, 675-678. I
respectfully agree with his analysis of the point in that case.
22. Section 8 of Title II (Lis Pendens – Related Actions) includes article
21, on which P. (USA) particularly relies:
Article 21
Where proceedings involving the same cause of action and between the
same parties are brought in the courts of different Contracting States
any court other than the court first seized shall of its own motion stay its
proceedings until such time as the jurisdiction of the court first seized is
established
Where the jurisdiction of the court first seized is established, any court
other than the court first seized shall decline jurisdiction in favour of that
court.
The provisions of article 21 must be read in conjunction with articles
16 and 19. Where the court first seized has exclusive jurisdiction by
virtue of article 16, the other court is required, by article 19, to decline
jurisdiction. In such a case article 21 is not engaged. Nor is article 21
engaged where it is the court other than the court first seized that has
exclusive jurisdiction by virtue of article 16. In such a case article 19
requires the court first seized to decline jurisdiction: the jurisdiction of the
court first seized is not capable of being established for the purposes of
article 21.
23. It follows that there will be many cases in which concurrent
proceedings between the same parties brought in the courts of different
Contracting States in respect of the infringement of national trade marks
will not fall to be dealt with under article 21 of the Brussels Convention;
notwithstanding that those proceedings may be said to involve “the
same cause of action”. That is because the underlying question in the
infringement proceedings will be: “Has the defendant infringed a valid
claim?” – see the observation of Mr J. L. in the Coin Controls case (ibid,
677). Article 21 will be in point only in those infringement cases in which
the validity of the national trade mark is not in issue.
24. P. (USA) places reliance, also, on the other articles in Section 8 of the
Convention – that is to say, on articles 22 and 23:
Article 22
Where related actions are brought in the courts of different Contracting
States, any court other than the court first seized may, while the actions
are pending at first instance, stay its proceedings.
A court other than the court first seized may also, on the application of
one of the parties, decline jurisdiction if the law of that court permits the
consolidation of related actions and the court first seized has jurisdiction
over both actions.
For the purposes of this Article, actions are deemed to be related where
they are so closely connected that it is expedient to hear and determine
them together to avoid the risk of irreconcilable judgments resulting from
separate proceedings.
Article 23
Where actions come within the exclusive jurisdiction of several courts, any
court other than the court first seized shall decline jurisdiction in favour of
that court.
25. For my part, I do not think that article 22 of the Convention provides
assistance in the present context. I would accept that infringement
proceedings involving national trade marks registered in the registries
of different Contracting States can be said to be “related actions” for
the purposes of article 22; at least in circumstances which enable
those proceedings to be heard and determined together. In such cases
article 22 empowers courts other than the court first seized to stay their
proceedings while the actions are pending at first instance. But, as it
seems to me, there will be little purpose in doing so unless the decision
on the common issue in the one court will be determinative of that issue
in the other court. And the power to decline jurisdiction cannot arise or be
exercised in cases where – because validity is in issue – each court has
exclusive jurisdiction (to the exclusion of the other) over the proceedings
which are before it. Nor do I think that article 23 of the Convention
is in point. The purpose of that article, as it seems to me, is to make
provision for the case in which there are, in the same action, matters over
which, by virtue of article 16, courts of different States have exclusive
jurisdiction. The article is needed in order to avoid the impasse to which
the application of article 19 would otherwise give rise.
26. It is said that the object of the provisions in Section 8 of Title II of
the Convention – that is to say, the provisions of articles 21, 22 and 23 -
“is to prevent conflicting decisions on identical or almost identical issues
arising between the same parties in different courts of the Contracting
States”. For my part, I would accept that the object of those provisions
is to avoid or reduce the possibility that courts in different Contracting
States may reach conflicting decisions in concurrent pending actions
between the same parties which raise the same or closely related issues.
But I find nothing in article 21 to suggest that that article is intended to
require a court in one Contracting State to stay its proceedings or decline
jurisdiction unless there is a concurrent action involving the same cause
of action and between the same parties pending in another Contracting
State; and nothing in article 22 to suggest that that article is intended to
empower a court in one Contracting State to stay its proceedings unless
there is a concurrent related action (within the meaning of that article)
pending in another Contracting State – or to decline jurisdiction unless
the two related actions could proceed together in another Contracting
State. It is, I think, important to keep in mind that Section 8 of Title II of
the Convention is directed, specifically, to the position where, under the
earlier Sections in the same Title, an action could be brought in more than
one Contracting State; but where, because an action involving the same
cause of action and between the same parties – or a related action – has
already been commenced in State A, a concurrent action ought not to be
allowed to proceed in State B. Where, at the time an action is commenced
in State A, one of the parties has already obtained a judgment in State B,
Section 8 of Title II is not in point. In such a case the relevant provisions
of the Brussels Convention are those in Section 1 (Recognition) of Title III
(Recognition and Enforcement).
27. Section 1 of Title III of the Convention comprises articles 26 to 30.
Article 26 sets out the basic rule: a judgment given in a Contracting State
shall be recognised in the other Contracting States without the need
for any special procedure. Article 27 prescribes circumstances (none of
which are in point in the present case) in which a judgment shall not be
recognised. Article 28 provides that a judgment shall not be recognised if
(inter alia) “it conflicts with the provisions of Sections 3, 4 or 5 of Title II”;
so a judgment in proceedings concerned with the registration or validity
of a national trade mark could not be recognised unless the proceedings
were in a court of the Contracting State in which registration had been
sought or had taken place – article 16(4). Article 29 provides that where
the court of one Contracting State is required to recognise the judgment
of another Contracting State, it may not review the substance of that
judgment. Article 30 enables a court of one Contracting State in which
recognition is sought of a judgment given in another Contracting State to
stay its own proceedings if an appeal against the foreign judgment has
been lodged.
28. It follows, as it seems to me, that in a case (like the present) where
the proceedings in the other Contracting State have already led to a
final judgment between the parties it is upon article 26 of the Brussels
Convention – and not upon article 21 – that reliance must be placed (if
at all). The relevant question, in the context of consecutive infringement
proceedings, is whether the requirement, under article 26, that the
judgment of the court of State B in proceedings for the infringement of
a national trade mark must be recognised by the courts of State A leads
to the conclusion that the court in State A must reach the same result
in later proceedings for the infringement of an identical or similar mark.
Whatever the answer to that question in a case where the proceedings in
State A are concerned only with the matter of infringement, it is, I think,
plain that the question must be answered in the negative in a case where
the proceedings in State A are concerned (as they often will be) with both
the infringement and the validity of a national trade mark registered in
the registry of State A. That is the effect of the requirement, in article 28,
that a judgment shall not be recognised if it conflicts with the provisions
of Section 5 of Title II – that is to say, with the provisions (inter alia)
of article 16(4). In a case involving both infringement and validity of a
national trade mark, the exclusive jurisdiction provisions of article 16(4)
– read in conjunction with articles 19 and 28 – have the effect (subject to
article 105 of the Regulation) that the issues are determined in the courts
of that State. As Mr Justice Laddie put it, in the passage at paragraph
[51] of his judgment in the present case to which I have already referred:
“Infringement and validity of a national trade mark has to be determined
in the national court in accordance with national law.”
The inter-relation of the Community Trade Mark Regulation and the
Brussels Convention
29. Article 90 of the Community Trade Mark Regulation is in these terms:
Article 90
Application of the Convention on Jurisdiction and Enforcement
1. Unless otherwise specified in this Regulation, the Convention on
Jurisdiction and the Enforcement of Judgments in Civil and Commercial
Matters, signed in Brussels on 27 September 1968 . . . shall apply
to proceedings relating to Community trade marks and applications
for Community trade marks, as well as to proceedings relating to
simultaneous and successive actions on the basis of Community trade
marks and national trade marks.
2. In the case of proceedings in respect of the actions and claims referred
to in Article 92 –
(a) Articles 2, 4, 5(1), (3), (4) and (5) and Article 24 of the Convention on
Jurisdiction and Enforcement shall not apply;
(b) Articles 17 and 18 of that Convention shall apply subject to the
limitations in Article 93(4) of this Regulation;
(c) the provisions of Title II of that Convention which are applicable
to persons domiciled in a Member State shall also be applicable to
persons who do not have a domicile in any Member State but have an
establishment therein.
30. The actions and claims referred to in article 92 are those over which
Community trade mark courts have exclusive jurisdiction. The article is in
these terms:
Article 92
Jurisdiction over infringement and invalidity
The Community trade mark courts shall have exclusive jurisdiction –
(a) for all infringement actions and – if they are permitted under national
law – actions in respect of threatened infringement relating to Community
trade marks;
(b) for actions for declaration of non-infringement, if they are permitted
under national law;
(c) for all actions brought as a result of acts referred to in article 9(3),
second sentence [matters arising after publication of a Community trade
mark application which would, after publication of the registration of the
trade mark, be prohibited by virtue of that publication];
(d) for counterclaims for revocation or for a declaration of invalidity of the
Community trade mark pursuant to Article 96.
31. The effect of those provisions is that articles 21 and 26 of the
Convention are made applicable to proceedings relating to simultaneous
and successive actions on the basis of CTMs and national trade marks –
including, in particular, trade mark infringement proceedings. That is what
paragraph 1 of article 90 of the Regulation requires; and there is nothing
in paragraph 2 of that article to limit that effect.
32. I have already noted that Article 21 of the Convention and article
105(1) of the Regulation apply – and apply only – where there are
concurrent, or simultaneous, proceedings. Article 21 of the Convention
requires that where proceedings involving the same cause of action
and between the same parties are brought in the courts of different
Contracting States, any court other than the court first seized shall of its
own motion stay its proceedings until such time as the jurisdiction of the
court first seized is established. I have sought to explain that article 21
must be read with articles 19 and 16(4) of the Convention; so that article
21 can apply only where the proceedings are for infringement alone, not
involving questions of the validity of national trade marks. In cases where
article 21 of the Convention could have applied if the proceedings were
actions for the infringement of national trade marks the effect of article
90 of the Regulation is that article 21 of the Convention applies also
where one of the courts is a Community trade mark court before which
there are proceedings for the infringement of a CTM. But article 90 of the
Regulation cannot have the effect of making article 21 of the Convention
applicable to a case in which one trade mark is a CTM in circumstances
where, if both trade marks were national trade marks, article 21 would
have no application. So article 21 will have no effect in a case where one
of the courts is “seized on the basis of a national trade mark” – that is
to say, where one of the courts is seized by virtue of article 16(4) of the
Convention.
33. It is to that problem that article 105(1) of the Regulation is addressed
– as the judge appreciated. The opening words of article 105(1) –
“Where [actions for infringement] involving the same cause of action and
between the same parties are brought in the courts of different [Member]
States . . .” - are indistinguishable from the opening words of article 21
of the Convention – “Where [proceedings] involving the same cause of
action and between the same parties are brought in the courts of different
[Contracting] States . . .” . But the words which follow in article 105(1)
– “one seized on the basis of a Community trade mark and the other
seized on the basis of a national trade mark” – make clear that article
105(1) of the Regulation is to apply to those cases to which article 21
of the Convention (even when read with article 90(1) of the Regulation)
cannot apply. Article 105(1) of the Regulation plainly does apply where
one court is seized on the basis of a national trade mark and so, but for
article 105(1), would have exclusive jurisdiction under article 16(4) of the
Convention – with the consequences that I have sought to describe.
34. As I have said, the effect of article 105(1) of the Regulation depends
on whether there is dual identity. Where the trade marks concerned
“are identical and valid for identical goods or services” the court other
than the court first seized “shall [of its own motion] decline jurisdiction”
in favour of the court first seized. The words of sub-paragraph (a) are
indistinguishable from those in the second paragraph of article 21 of the
Convention. Where the trade marks concerned “are identical and valid for
similar goods or services” or “are similar and valid for identical or similar
goods or services” the court other than the court first seized “may stay
its proceedings”. The words of sub-paragraph (b) are indistinguishable
from those in the first paragraph of article 22 of the Convention. It is
pertinent to have in mind that the protection afforded by article 5(1)(a) of
the First Council Directive (89/104/EEC) in cases of dual identity does not
depend on establishing confusing similarity, for obvious reasons. Cases
in which the question whether there exists “a likelihood of confusion on
the part of the public” or a “likelihood of association between the sign and
the trade mark” – article 5(1)(b) cases - will fall within article 105(1)(b)
of the Regulation. The existence, or otherwise, of confusing similarity is
an area in which national courts have a special role: it is for the national
court to make the assessment in the light of the circumstances prevailing
in its own territory – see Lloyd Schuhfabrik Meyer & Co GmbH v Klijsen
Handel BV (Case C – 342/97) [1999] ECR I 3819, at paragraph 11. It is,
therefore, no surprise to find that the court is given a discretion under
sub-paragraph (b) of article 105(1) which it does not have under sub-
paragraph (a). It is also no surprise to find that articles 105(2) and (3)
apply only in dual identity cases.
35. The relationship between paragraph 1 and paragraphs 2 and 3 of
article 105 of the Regulation reflects the relationship between Section 8 of
Title II and Section 1 of Title III of the Brussels Convention. Section 8 of
Title II and paragraph 1 of article 105 apply where there are concurrent,
or simultaneous, actions; Section 1 of Title III and paragraphs 2 and 3
of article 105 apply in cases where the proceedings are consecutive, or
successive. I have sought to explain that the problem to which paragraph
1 of article 105 of the Regulation is addressed is that (without that
paragraph) there would be nothing in the Regulation to require a court
seized on the basis of a national trade mark, under article 16(4) of the
Convention, to decline jurisdiction in favour of a Community trade mark
court seized on the basis of a CTM (or vice versa) – notwithstanding that
the court seized on the basis of the CTM (or the court seized on the basis
of the national trade mark, as the case might be) was the court first
seized – and nothing which would enable either court to stay proceedings
where the actions before them were related. In particular, article 90(1) of
the Regulation, in conjunction with articles 21 and 22 of the Convention,
does not have that effect. The problem to which paragraphs 2 and 3 of
article 105 of the Regulation are addressed, as it seems to me, is the
same; but in the context of consecutive or successive proceedings. Absent
paragraph 3 of article 105 there would be nothing in the Regulation
to require a court seized on the basis of a national trade mark, under
article 16(4) of the Convention, to give effect to a judgment in earlier
proceedings involving the same cause of action and between the same
parties, of a Community trade mark court seized on the basis of a CTM;
and, absent paragraph 2, there would be nothing to require a Community
trade mark court seized on the basis of a CTM to give effect to an earlier
judgment of a court seized on the basis of a national trade mark. Article
90(1) of the Regulation, in conjunction with article 26 of the Convention,
does not have that effect.
36. That that is the problem to which paragraphs 2 and 3 of article 105
of the Regulation are addressed is confirmed by a careful reading of the
provisions in those paragraphs in the light of article 90 of the Regulation
and of the provisions of the Convention relating to simultaneous and
successive civil actions; and with the obvious purpose of paragraph 1 of
article 105 in mind.
37. The factor common to all three paragraphs of article 105 of the
Regulation is that the actions should involve “the same cause of action
and [be] between the same parties”. That expression - “the same cause of
action and between the same parties” - is found, also, in article 21 of the
Convention. The meaning of the phrase “the same cause of action” in that
context was considered by the Court of Justice in Gubisch Maschinenfabrik
KG v Palumbo (Case 144/86) [1987] ECR 4861. The Court explained that
article 21 must be construed as if the requirement were that the two
actions were between the same parties and involved the same cause of
action and the same subject matter – see paragraph 14 of its judgment
(ibid, 4875) and the translator’s note at page 4863. The Court went on to
say this:
“15. In the procedural situation which has given rise to the question
submitted for a preliminary ruling the same parties are engaged in two
legal proceedings in different Contracting States which are based on the
same ‘cause of action’, that is to say the same contractual relationship.
The problem which arises, therefore, is whether those two actions have
the same ‘subject matter’ when the first seeks to enforce the action and
the second seeks its rescission or discharge.
16. In particular, in a case such as this, involving the international sale
of tangible moveable property, it is apparent that the action to enforce
the contract is aimed at giving effect to it, and that the action for its
rescission or discharge is aimed precisely at depriving it of any effect.
The question whether the contract is binding therefore lies at the heart
of the two actions. If it is the action for rescission or discharge of the
contract that is brought subsequently, it may even be regarded as simply
a defence against the first action, brought in the form of independent
proceedings before a court of another Contracting State.
17. In those procedural circumstances it must be held that the two
actions have the same subject matter, for that concept cannot be
restricted so as to mean two claims which are entirely identical.”
The Court of Justice adopted the same approach in its subsequent
decision on the reference in “The Tatry”(Case C-406/92) [1994] 1 ECR
5439. It observed, at paragraph 39 of its judgment (ibid, 5475), that
for the purposes of article 21 of the Convention “the ‘cause of action’
comprises the facts and the rule of law relied on as the basis of the
action”; and, at paragraph 41, that “The ‘object of the action’ . . . means
the end the action has in view”. At paragraph 42 the Court said this:
“The question accordingly arises whether two actions have the same
object when the first seeks a declaration that the plaintiff is not liable for
damage as claimed by the defendants, while the second, commenced
subsequently by those defendants, seeks on the contrary to have the
plaintiff in the first action held liable for causing loss and ordered to pay
damages.”
It answered that question in the affirmative.
38. What, then, is the need for the words “on the basis of an identical . . .
trade mark valid for identical goods or services” which appear at the
end of paragraphs 2 and 3 of article 105 of the Regulation? Those words
cannot be intended to add anything to the phrase “the same cause of
action” which is used earlier in the same paragraphs. If those words were
allowed to qualify that phrase, they would cut down the meaning which
the Court of Justice has taught that the phrase is intended to convey.
The true analysis, as it seems to me, is that those words are intended to
qualify the earlier phrase “a final judgment on the merits”; by identifying
the court by which the judgment is to have been given. The words are
intended to make it plain that paragraphs 2 and 3 of article 105 apply
where “a final judgment on the merits has been given . . . by a court
seized on the basis of an identical . . . trade mark valid for identical
goods or services”. They are to be read in conjunction with the opening
words in each of paragraphs 2 and 3. The paragraphs apply where the
court hearing an action “. . . seized on the basis of a [Community/
national] trade mark” . . . finds that a “a final judgment on the merits has
been given . . . by a court seized on the basis of an identical [national/
Community] trade mark valid for identical goods or services”. Read in that
way, paragraphs 2 and 3 complement, precisely, paragraph 1(a) of article
105; and they meet the problem which article 28 of the Convention, read
with article 90 of the Regulation, does not meet.
Does article 105 of the Regulation have any application in the present
case?
39. The principal question on this appeal is whether article 105(2) of
the Regulation requires the United Kingdom court to reject proceedings
brought by P. (UK) for the infringement of the Community trade marks
“PRU” and “P.” by the use of the mark “PR.” on the grounds that there
has been a final judgment on the merits in the Cour d’Appel in opposition
proceedings relating to the registration, in France, of the mark “PR.”. The
view which I have taken of the meaning and effect of article 105(2) leads,
necessarily, to the conclusion that that question must be answered in
the negative. The French court was seized on the basis of the national
trade mark “PR.”. The United Kingdom court is seized, under article 92
of the Regulation, on the basis of the CTMs “PRU” and “P.”. Whether or
not the marks are valid for identical goods or services, the requirement
of dual identity is not satisfied. The marks on the basis of which the two
courts are seized are not themselves identical. Article 105(2) can have no
application in the present case.
The judge’s approach
40. That would be sufficient to dispose of the principal question on this
appeal. But, in recognition of the arguments put before us, I think it right
to examine the basis upon which the judge reached the same conclusion –
that article 105(2) was not in point.
41. The argument advanced on behalf of P. (USA) in the court below
– and pursued in this Court – emphasised the need to give to the
expression “the same cause of action and between the same parties”
the same meaning and effect in article 105 of the Regulation as it was
to be given in the context of article 21 of the Convention; that is to say,
the meaning which the Court of Justice had held that that expression
should be given in the Gubisch case and in The Tatry. The argument was
summarised by the judge at paragraph [68] of his judgment ([2002] IP&T
781, 801). It was submitted that the same cause of action is involved
when the question for determination is whether two marks are confusingly
similar, whether that question is raised in the context of infringement of
one by the other or in the context of preventing registration of one in the
face of registration of the other. Thus an infringement action is, for this
purpose, the same cause of action as a trade mark opposition where the
same two marks are in conflict. The factual issue which has to be resolved
in each case is whether there exists a likelihood of confusion between
the two. Once that issue has been decided in one proceeding between
two parties, they cannot reopen it. To allow them to do so would be to
risk conflicting decisions on the issue, which is what article 105 of the
Regulation is designed to prevent.
42. The judge accepted (at paragraph [70] of his judgment) that
essentially the same factual issue can arise in an infringement action as
in a trade mark opposition. As he said, it follows that it is possible for a
court to come to one conclusion in relation to the issue of whether the
defendant’s mark infringes the registered proprietor’s mark and, in theory,
a trade mark registry could come to a different conclusion in relation to
the issue whether those two marks were confusingly similar for trade
mark proceedings. The possibility of inconsistent decisions is inherent in a
scheme which allows the registration of national trade marks.
43. The judge pointed out that article 105(1) of the Regulation applies, in
terms, only where there are concurrent actions for infringement. In the
light of that requirement he thought that it was essential to the argument
advanced on behalf of P. (USA) under article 105(2) that “a trade mark
opposition be treated as if it was a kind of infringement action since it
involves substantially the same issue of confusing similarity”. He rejected
that premise. At paragraphs [75], [76] and [77] of his judgment ([2002]
IP&T 781, 803f-804d he said this:
“[75] . . . The correct starting point is art 105(1) which is concerned
with the situation where there are concurrent ‘actions for infringement’
concerning a Community trade mark and the equivalent national trade
mark. Although one of the issues a national registry will have to consider
in determining an opposition is virtually identical to a major issue which
will arise in an infringement action between the same two marks, this
does not mean that the trade mark registry proceedings can be described
as an ‘action for infringement’ as required by art 105(1). It is nothing of
the sort. It is not made so by describing the relief sought by an applicant
whose mark is under opposition as ‘registration on the grounds of non-
infringement’. Article 105(1) is designed to prevent multiple infringement
proceedings being brought in different member states. This should cause
no difficulty to the proprietor of the mark alleged to have been infringed.
Since the CTM is effective in all member states, in effect what art 105(1)
requires is that the proprietor should sue for CTM infringement and
national trade mark infringement in the same court at the same time.
[76] The purpose of art 105(2) and (3) is to achieve the same effect
as art 105(1) but in a case where the infringement proceedings are not
concurrent but sequential. Even if there was obscurity in the wording
used, this is the obvious legislative intention and the provisions should
be construed accordingly. However the wording of both art 105(2)
and (3) reinforce the point. This can be illustrated by reference to art
105(2) which provides for priority as between a court hearing an action
for infringement of a CTM on the one hand and a final judgment on
the merits given in respect of a ‘trade mark valid for identical goods
or services’. As mentioned above, the word ‘valid’ here must mean
‘registered’ or ‘in force’. This is not appropriate language for describing
opposition proceedings to the grant of a registration. The prior judgment
has to be in respect of a granted trade mark. In my view this is a
reference to a judgment in an infringement action and cannot apply to
opposition proceedings where the issue is whether a registration should
be granted. Furthermore this is consistent with the relationship between
art 105(2) and (3). They are, in effect, mirror images of each other. In
the former the action for infringement of the CTM is the second in time, in
the latter it is the action for the infringement of the national trade mark.
In both they are considering infringement actions for the CTM and the
national trade mark, just as art 105(1) does.
[77] Thus opposition proceedings before a national registry (or OHIM) are
not to be equated with an action for infringement under art 105. This is
not altered by the fact that in this case an appeal lay to the Cour d’Appel.
The hierarchy through which the proceedings pass during the appeal
phase does not alter the nature of the proceedings. The proceedings in
France started out as an opposition and remained such on appeal.”
44. I agree with the judge’s observations in paragraph [75] of his
judgment – as set out above. It is plain that article 105(1) of the
Regulation applies only where both actions are actions for infringement.
An opposition to registration is not an action for infringement;
notwithstanding that similar questions may arise in relation to confusing
similarity. Further, for the reasons which I have already sought to explain,
where the question is one of confusing similarity, the case will fall within
sub-paragraph (b) of article 105(1); and not within sub-paragraph (a).
And there are obvious reasons why registration proceedings should not
have been brought within article 105(1) of the Regulation. Registration
of national trade marks is essentially a matter for national trade mark
registries – with appeals (if provided under national law) to national
courts. Registration of CTMs is a matter reserved, exclusively, to OHIM
– with an appeal to Boards of Appeal and, ultimately, to the Court of
Justice.
45. I am less confident that the judge is correct in his view – expressed
in paragraph [76] of his judgment – that articles 105(2) and (3) apply
only where both the earlier proceedings and the sequential, or successive,
proceedings are actions for infringement. Plainly, the later proceedings
must be: articles 105(2) and (3) so provide. But I would not rule out
the possibility that a Community trade mark court hearing proceedings
for infringement of a CTM in which dual identity is alleged may be
required to reject the action if the same point has been determined by a
national court in earlier proceedings for revocation, or for a declaration of
invalidity, of an identical national trade mark valid for identical goods or
services. It is unnecessary to decide the point on this appeal. I prefer to
put my judgment on the fact that, in this case, the necessary requirement
of dual identity is not present.
Does article 26 of the Convention require the United Kingdom court to
dismiss the infringement claim?
46. The judge appreciated, of course, that article 105 of the Regulation
could have no direct application to the challenge to infringement
proceedings in so far as P. (UK) sought to enforce its United Kingdom
trade marks. But he went on to reject a submission that - if he had held
that the challenge to infringement proceedings in respect of the CTMs
could succeed on the basis of article 105 of the Regulation (which he
did not) - he ought to give article 105 some indirect effect in relation to
the infringement proceedings in respect of the national trade marks. In
my view he was right to do so; and I do not understand that part of his
decision to be challenged.
47. The real question is whether article 26 of the Brussels Convention
requires the United Kingdom court to “recognise” the judgment of the
Cour d’Appel by refusing to entertain proceedings the object of which is to
obtain a decision which is inconsistent with that judgment. The question
can be stated in this form: does article 26 require a court in State A to
dismiss proceedings for infringement of a national trade mark registered
in the register of State A, where the infringement alleged is the use in
State A of a similar mark which has been registered as a national trade
mark in the registry of State B, in circumstances where there has been
a judgment of a court in State B rejecting opposition to the registration
of that mark on the grounds that the similarity of the two marks is not
confusing. As I have sought to explain, the answer to that question is
plainly “No” in a case where the court in State A is seized on the basis
that the validity of its own national mark is in issue – article 16(4) and
article 28 of the Convention. But, if the validity of the national mark is
not in issue in the action before the court in State A, it seems to me
that the answer is much less clear. And if (in such a case) the court in
State A is required to dismiss the proceedings for infringement of its own
national marks, it may well be required, also, to dismiss proceedings for
infringement of the CTMs – article 90(1) of the Regulation.
48. The judge did not decide that point. He thought that the argument
that infringement proceedings in respect of the United Kingdom marks
could be challenged on the basis of the Convention – without recourse
to article 105 of the Regulation – was not seriously pursued. And it
is pertinent to note that the application notice which was before him
contains no reference to article 26 of the Convention. Indeed, in the
grounds of appeal to this Court it seems to have been included, by way of
adjunct to article 21, almost as an afterthought.
49. In my view it would be wrong to decide that question on this appeal.
We have not heard argument upon it; and, without knowing whether the
validity of the United Kingdom trade marks are to be put in issue in these
proceedings, it is impossible to say whether it will arise. It is enough
to decide, at this stage, that article 26 of the Convention can be of no
assistance to P. (USA) unless it can show that the proceedings do not fall
within the exclusive jurisdiction conferred by article 16(4). That has not
been established.
Should there be a reference in this case?
50. We were urged by counsel for P. (USA) to refer the jurisdictional
questions raised on this appeal to the Court of Justice for a preliminary
ruling under article 234 of the EC Treaty. There is power to do so where
the court of a Member State before which such questions are raised
considers that a decision on the question is necessary to enable it to
give judgment. For my part, I accept that this Court should, ordinarily,
do so in a case in which it has any real doubt – see the observations
of Sir Thomas Bingham, Master of the Rolls, in R v International Stock
Exchange, ex parte Else [1993] QB 534, 545C-G. But in exercising the
power to refer the national court must observe some measure of self
restraint: lest the Court of Justice become overwhelmed. In particular, the
national court should be cautious when asked to make a reference for a
preliminary ruling in a case where it may turn out, after the facts have
been established, that the point does not, in the event, arise.
51. In my view we should decline to direct a reference at this stage in
the present case. My reasons are these. Whatever the decision on the
jurisdictional points raised on this appeal, the action will proceed to trial
on the 1974 contract issue. If P. (UK) succeeds on that issue, the question
whether it could succeed on a claim for infringement of its trade marks
will become moot. Second, a decision on the scope of article 105 of the
Regulation will not determine the question whether the United Kingdom
court has jurisdiction to determine the claims for infringement of the
national trade marks. As I have said, article 105 of the Regulation has
no application to those claims. Third, I am satisfied that there is no real
doubt that article 26 of the Convention can have no application to the
claims for infringement of the national trade marks – nor any application,
by the extension effected by article 90(1) of the Regulation, to the CTMs
– unless it be established that the proceedings do not fall within the
exclusive jurisdiction conferred by article 16(4) of the Convention. And, as
I have said, that has not yet been established. A reference which required
the Court of Justice to address the question what effect, if any, article 26
of the Convention does have in a case which falls outside article 16(4)
would be premature.
Conclusion
52. I would dismiss this appeal.
53. Lord Justice Potter:
54. I agree and have nothing to add.
55. Lord Justice Kennedy:
56. I also agree.
Order: Appeal dismissed with the costs subject to detailed assessment.
Interim payment of £40,000 to be paid within 21 days. Application to
refer question to European Court of Justice refused. Permission to appeal
was refused.
(Order does not form part of the approved judgment) (…)“