How do you assess unfair advantage?
The High Court has upheld a UK IPO finding that the registration of a UK trade mark for RED DAWG should be refused under Section 5(3) of the Trade Marks Act, as it would take unfair advantage of the earlier mark RED BULL.
The application to register RED DAWG was filed by Monster Energy Company, which appealed the UK IPO finding to the High Court. The Court’s judgment was published on 12 August 2022 and the case is Monster Energy Company v Red Bull GmbH  EWHC 2155 (Ch) (12 August 2022).
What is unfair advantage?
The case hinged on the question of “unfair advantage”. The Hearing Officer (Mr James Hopkins) had concluded that:
“The contested mark would be able to attract more consumers to purchase goods offered under it than would be the case if the earlier mark was not brought to mind. This would essentially allow the contested mark to free-ride on the reputation of the earlier mark and gain an unfair commercial advantage.”
The judge, Mr Justice Adam Johnson, said this conclusion was not open to challenge. He noted that the analysis of unfairness does not depend on the applicant’s subjective intention. Rather, the question is whether consumers are more likely to buy the goods/services of the later mark than they would otherwise have been if they had not been reminded of the earlier mark.
The Hearing Officer’s interpretation of the legal principles was correct, his evaluation did not involve an error of principle and nor was it clearly wrong. The judge concluded:
“It was entirely legitimate for Mr Hopkins (1) to proceed on the basis that in adopting the RED DAWG mark, Monster were intending to seek to influence the economic behaviour of consumers of their products – indeed, that would seem the most obvious reason for doing so; and (2) to infer that the similarity between RED BULL and RED DAWG, although not apt to cause confusion, would nonetheless make it easier for Monster to sell its products without incurring the marketing costs that would otherwise have been required.”
He added that these were “entirely legitimate and common-sense propositions”.
Section 5(2)(b) versus Section 5(3)
Red Bull had originally opposed the application to register RED DAWG based on both Section 5(2)(b) and Section 5(3). The objection based on Section 5(2)(b) was rejected based on the lack of likelihood of direct or indirect confusion.
A Section 5(3) challenge requires that (1) the earlier mark has a reputation, (2) the use of the contested mark would call to mind the earlier mark and (3) there would be either detriment to the distinctive character, detriment to the reputation or (as in this case) taking unfair advantage of the earlier mark.
This case shows that the strong protection available to earlier marks with a reputation, provided these three conditions are met.