Breaking the Ice: A New Era for Statutory Acquiescence in Trade Mark Law

In the recent case of Industrial Cleaning Equipment (Southampton) Ltd v Intelligent Cleaning Equipment Holdings Co Ltd and Killis Ltd [2023] EWCA Civ 1451, the Court of Appeal issued a pivotal judgment that redefines the timing for statutory acquiescence in trade mark disputes. By departing from retained EU case law, the court clarified the conditions under which a trade mark owner can lose the right to challenge another mark, signalling a significant shift in the UK’s post-Brexit approach to intellectual property law.

This case not only addresses the technical aspects of statutory acquiescence but also highlights the evolving willingness of UK courts to depart from EU precedents where they no longer align with domestic legislative intent.

The Dispute: A Clash of Marks

The case arose from a dispute between two companies, both of which used variations of the trade mark “ICE” in connection with their cleaning equipment businesses. The Claimant alleged that the Defendants’ marks, consisting of a word mark (ICE) and a logo, infringed the Claimant’s own logo mark.

Key dates played a crucial role in the case: 

• The Claimant’s mark: First used in 2007, the Claimant did not register its logo until 22 January 2016.
  
  
• The Defendants’ marks: Registered internationally in mid-2015 through WIPO, the marks gained EU protection on 24 May 2016 (word mark) and 15 June 2016 (logo mark).
  
  
• The Claimant only became aware of the Defendants’ registrations in July 2019, when the Defendants sent a letter asserting their trade mark rights. The Claimant subsequently filed an infringement and invalidity claim on 24 May 2021.

The key issue was whether the Claimant’s delay in acting barred its claims under the doctrine of statutory acquiescence.

First Instance: Knowledge of Registration is Key

At trial, HHJ Clarke rejected the Defendants’ reliance on statutory acquiescence under section 48 of the Trade Marks Act 1994 (the “Act”). Statutory acquiescence prevents a trade mark proprietor from challenging a later mark if:

1. The proprietor has knowingly tolerated its use for five continuous years.
   
   
2. The later mark’s application was made in good faith.

Relying on the retained EU case of Budejovický Budvar np v Anheuser-Busch Inc (Case C-482/09, “Budvar”), HHJ Clarke held that the five-year period begins to run only when the proprietor of the earlier trade mark knows of both the use and registration of the later mark.

The Defendants argued that the five-year period should start when the Claimant became aware of the Defendants’ use of the marks in 2014. However, HHJ Clarke found that the Claimant only became aware of the marks’ registration in July 2019. As the Claimant’s claim was filed in May 2021, it fell within the five-year period, and the statutory acquiescence defence failed.

The trial court also found in favour of the Claimant on infringement and invalidity, holding that the Defendants’ marks were liable to be restrained for passing off under sections 5(4)(a) and 47(2)(b) of the Act.

The Appeal

The Defendants appealed the decision, raising two key issues:

1. When does the five-year acquiescence period start?

The Defendants argued that it is sufficient for the earlier trade mark owner to know of the later mark’s use, regardless of whether they are aware of its registration.

2. What is the registration date for international trade marks?

For marks registered through WIPO, the Defendants claimed the registration date should be the WIPO filing date rather than the date the mark gained protection in the EU.

The Court of Appeal’s Decision

Issue 1: When Does Time Start Running for Acquiescence?

Lord Justice Arnold, delivering the leading judgment, re-examined the legal framework for statutory acquiescence. Section 48 of the Act, derived from EU trade mark law, prevents the owner of an earlier trade mark from challenging a later mark if they knowingly tolerate its use for five continuous years after its registration.

The EU case Budvar had established that the five-year period begins only when the earlier trade mark owner becomes aware of both the later mark’s use and its registration. However, Arnold LJ identified significant issues with this precedent:

• The judgment in Budvar lacked detailed reasoning on the requirement for knowledge of registration.
• Other EU case law suggested that knowledge of use, not registration, might suffice to start the clock.
• The Budvar ruling appeared to conflict with the broader policy objectives of trade mark law, which prioritize clarity and fairness in resolving disputes.

Arnold LJ concluded that UK law should depart from Budvar. He ruled that the five-year period begins when the earlier trade mark owner becomes aware of the later mark’s use, provided the mark has been registered, regardless of whether the owner knows of the registration. This interpretation, he argued, better serves the legislative purpose of balancing the interests of trade mark owners and promoting legal certainty.

This decision underscores the UK courts’ growing willingness to adapt EU case law post-Brexit, particularly where existing precedents are weakly reasoned or inconsistent with legislative objectives.

Issue 2: What is the Registration Date for International Marks?

For international trade marks registered through WIPO, the Defendants argued that the relevant “registration date” should be the WIPO filing date. However, Arnold LJ rejected this argument, finding that the registration date under EU law is tied to the mark’s acceptance or republication by the EUIPO.

Applying this reasoning, the Court determined that the relevant registration dates for the Defendants’ marks were 24 May 2016 (word mark) and 15 June 2016 (logo mark). Since the Claimant filed its claim on 24 May 2021, it narrowly avoided the five-year statutory limit.

Implications of the Decision

The ICE v ICE judgment has far-reaching implications for trade mark law and beyond:

1. Clarification of Statutory Acquiescence

By departing from Budvar, the Court of Appeal has provided much-needed clarity on when the five-year acquiescence period begins. This decision ensures that trade mark owners cannot indefinitely delay acting by claiming ignorance of registration, promoting greater fairness in trade mark disputes.

2. Post-Brexit Legal Evolution

This case illustrates the UK courts’ willingness to reinterpret or depart from retained EU case law considering domestic legislative priorities. While the courts have been cautious in other areas, such as copyright law, this decision highlights a more flexible approach to trade mark disputes.

3. Practical Lessons for Trade Mark Owners

The judgment underscores the importance of vigilance in protecting intellectual property rights. Trade mark owners should regularly monitor the register and act promptly to challenge potential infringements. Delays, even if inadvertent, can have serious legal consequences.

Conclusion

The ICE v ICE decision represents a turning point in UK trade mark law, demonstrating the courts’ readiness to move beyond retained EU precedents and adapt the law to better serve domestic interests. By clarifying the rules on statutory acquiescence, the judgment provides greater certainty for trade mark disputes while signalling a broader evolution of intellectual property law in the post-Brexit era.

For businesses and trade mark owners, the case serves as a timely reminder of the importance of proactive strategies in registering, monitoring, and enforcing trademarks. In an increasingly complex legal landscape, vigilance and timely action remain key to safeguarding intellectual property rights.

https://www.bailii.org/ew/cases/EWCA/Civ/2023/1451.html