Neutral Citation Number: [2017] EWHC 3387 (Pat)
Case No: HP-2017-000062

IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INTELLECTUAL PROPERTY LIST (CHANCERY DIVISION)

Rolls Building
Fetter Lane, London, EC4A 1NL
21 December 2017

B e f o r e :

MR JUSTICE ARNOLD
____________________

Between:

THE BLACK & DECKER CORPORATION
Claimant
– and –

DVIZE BV
Defendant

____________________


Jonathan Moss (instructed by Venner Shipley LLP) for the Claimant
Stewart Chirnside (instructed by Penningtons Manches LLP) for the Defendant
Hearing date: 15 December 2017
Further written submissions 18 December 2017

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HTML VERSION OF JUDGMENT

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Crown Copyright ©

    MR JUSTICE ARNOLD :

    Contents

    Topic Paragraphs
    Introduction 1-6
    Factual background 7-70
        The parties 8-9
        Negotiations over the 2012 agreement 10-18
        The 2012 Agreement 19-20
        The Middle East Licence 21
        Negotiations over the Maryland Agreement 22-42
        Withdrawal of the Maryland Agreement 43-46
        Discussions about an extension to the 2012 Agreement for 2017 and discussions between Dvize and Bond 47-65
        The Maryland proceedings 66-67
        These proceedings 68-70
    Relevant provisions of the EUTM Regulation 71
    BDC’s claim for infringement of the Trade Marks 72-74
    Dvize’s defence to the claim 75-76
    Dvize’s application to challenge the jurisdiction 77-104
        Applicable principles 77-81
             Article 125(5) 77-79
        Standard of proof 80-82
        Assessment 83-105
             Good arguable case of a threat to use the Trade 83-98
             Marks in the UK?  
             Good arguable case on the issue of consent? 99-107
             Conclusion 108
    BDC’s application for an interim injunction 109-112

    Introduction

  1. There are two applications before the Court:
  2. i) an application by the Claimant (“BDC”) by application notice dated 9 October 2017 for an interim injunction to restrain the Defendant (“Dvize”) from using BDC’s EU Trade Marks Nos. 12 786 323 (BLACK + DECKER) and 12 788 352 (BLACK + DECKER device) (“the Trade Marks”) in the United Kingdom until the conclusion of the trial; and

    ii) an application by Dvize, which is incorporated, and thus domiciled, in the Netherlands, by application notice 21 November 2017 challenging the jurisdiction of this Court to try BDC’s claim against Dvize.

  3. Dvize was licensed to use trade marks corresponding to the Trade Marks under a manufacturing and distribution agreement dated 27 April 2012 (“the 2012 Agreement”) which expired on 31 December 2016. Dvize contends that the parties entered into a replacement agreement on 25 May 2016 (“the Maryland Agreement”) under which it is licensed to use the Trade Marks until 31 December 2021, alternatively that BDC is estopped from denying the existence of such an agreement. BDC disputes that any agreement was concluded on 25 May 2016 or that it is estopped. BDC contends that it unilaterally granted Dvize consent to use the Trade Marks until 31 December 2017 unless terminated earlier and that it terminated that consent with effect from 9 October 2017. Accordingly, it is common ground that Dvize’s entitlement to use the Trade Marks at least from after 31 December 2017, and possibly from after 9 October 2017, depends on whether the Maryland Agreement was concluded or BDC is estopped.
  4. BDC issued the Claim Form in these proceedings on 21 September 2017. In the Claim Form, BDC sought conventional relief for infringement of the Trade Marks, but it also sought a declaration that “the 2012 Agreement has terminated and the provisions no longer apply”. Furthermore, in the Form N510 “Notice for service out of the jurisdiction where permission of the court is not required” completed by BDC pursuant to CPR rule 6.34, BDC checked the box stating that “each claim made against the defendant to be served and included in the claim form is a claim which the court had power to determine under the Judgments Regulation and the defendant is a party to an agreement conferring exclusive jurisdiction within article 25 of the said Regulation”. The exclusive jurisdiction agreement that was relied upon was the 2012 Agreement.
  5. At the hearing, however, BDC did not rely upon any cause of action in contract, nor did it contend that this Court had jurisdiction by virtue of Article 25 of European Parliament and Council Regulation 1215/2012/EU of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (“the Brussels I Recast Regulation”). Instead, BDC relied purely upon its claim for trade mark infringement, and contended that this Court had jurisdiction by virtue of Article 125(5) of European Parliament and Council Regulation 2017/1001/EU of 14 June 2017 upon the European Union trade mark (“the EUTM Regulation”). Accordingly, counsel for BDC confirmed that the Court should proceed in the basis that the Claim Form would be amended to delete the claim relating to the 2012 Agreement, and parallel amendments would be made to the Particulars of Claim.
  6. BDC also contends that, even if this Court does not have jurisdiction over its claim on the merits, it does have jurisdiction to grant an interim injunction pursuant to Article 131 of the EUTM Regulation. In that event, BDC undertakes to commence proceedings for infringement of the Trade Marks against Dvize in the Netherlands.
  7. In the event that the Court concludes that it has jurisdiction over BDC’s claim on the merits, Dvize offers an undertaking not to use the Trade Marks in the UK until the conclusion of the trial. No such undertaking is offered by Dvize in the event that the Court concludes that it does not have jurisdiction.
  8. Factual background

  9. The following account of the factual background is based upon the evidence served by the parties on the two applications before the Court, which consists of two witness statements of Darrin Shaya (Director of Patents, Europe of Stanley Black & Decker Inc (“SBD”)) and two witness statements of Amit Datta (a Senior Licensing Manager for the BLACK + DECKER brand employed by SBD) served on behalf of BDC and two witness statements of Adriaan Van Oort (a director and one of the two owners of Dvize) and a witness statement of Rustam Dubash (of Dvize’s solicitors) served on behalf of Dvize. As such, my account is necessarily provisional and incomplete, but nevertheless it appears that all the key correspondence between the parties has been exhibited to the witness statements.
  10. The parties

  11. BDC, which is incorporated in the State of Maryland, USA, is a wholly-owned subsidiary of SBD, a supplier of industrial and domestic tools which are marketed under the well-known BLACK + DECKER and STANLEY trade marks. BDC exploits these trade marks, at least in part, through licensing. BDC uses the services of a licensing agency called Beanstalk to negotiate with prospective licensees. The precise division of responsibilities between SBD and BDC is unclear on the evidence, but probably does not matter. I shall refer to the two inter-changeably.
  12. Dvize is a manufacturer and distributor of garden tools. LTM Holding BV (“LTM”) is a Dutch company owned by Loek Tertaas, who is the other owner of Dvize.
  13. Negotiations over the 2012 Agreement

  14. Mr Shaya gives quite a lot of evidence in his witness statements about the process by which the 2012 Agreement was negotiated and concluded. Very little of what Mr Shaya says about this is disputed by Mr Van Oort in his witness statements. Much of the detail is unnecessary for present purposes, but the key points are as follows.
  15. Mr Van Oort explains that, before becoming BDC’s licensee, Dvize was the distributor of STANLEY branded garden hand tools on behalf of an Australian company, IMS International P/L Dandenong Victoria (“IMS”) which held the Australian and European licences. In September 2011, at the GAFA garden trade show in Cologne, Dvize was approached by Beanstalk to become the STANLEY licensee in Europe in place of IMS. During the discussions about Dvize becoming a STANLEY licensee, Dvize was offered the licence for BLACK + DECKER branded products as well.
  16. On 9 January 2012 Matthew Tobia of Beanstalk sent Mr Shaya two deal memos which had been completed by Beanstalk in relation to the BLACK + DECKER and STANLEY licences. At that time, BDC’s practice was that licence agreements were drafted by SBD’s legal department in Slough, where Mr Shaya was based. On 22 February 2012 Mr Shaya sent Beanstalk a draft Dvize BLACK + DECKER garden hand tool licence which he had prepared with the assistance of BDC’s external solicitors. There were then negotiations between BDC and Dvize, which were mainly but not exclusively conducted via Beanstalk, over the detailed terms of what became the 2012 Agreement.
  17. On 20 April 2012 Mr Tobia sent Daniel Kinsbergen of Dvize an email, copied to Dvize’s Dutch lawyers and Ian Joynson of Beanstalk, saying:
  18. “Please see attached what we hope to be the final draft of the Dvize Black & Decker license.

    …

    Assuming you are happy with this final agreement, please sign and return 4 copies to us by registered courier to the address below. We will then route to SBD for full execution and return a fully executed copy back to you.

    …

    Please also return a scanned copy of the signed agreement before sending the agreement.”

  19. On 24 April 2012 Mr Kinsbergen replied confirming that “the 4 original documents will be signed and send via FEDEX to you”. On 2 May 2012 Mr Kinsbergen sent the Fedex tracking number. On 3 May 2012 Mr Tobia reported receipt of the agreements signed by Dvize to Mr Shaya, but noting that Beanstalk had spotted a minor typo. The agreements had also been dated 27 April 2012 by Dvize in manuscript.
  20. On 8 May 2012 Mr Tobia sent Mr Kinsbergen an email saying:
  21. “Whilst going through the Partially Executed copies of the B&D Garden Hand Tools agreement our finance team has highlighted a minor spelling mistake on the Beanstalk bank details …

    Following a discussion with the SBD legal team they were happy for us to amend this typo by pen and confirm with you that you are happy with this amendment.

    Please review the changes made in the attached document and confirm Dvize is happy for us to proceed and forward it to Stanley Black & Decker to fully execute the agreement.”

  22. Mr Kinsbergen replied the same day saying:
  23. “We agree to move forward with the made change … with a pen.

    Please proceed and forward to Stanley Black & Decker to fully execute the agreement.”

  24. It is not clear from Mr Shaya’s evidence whether, and if so when, BDC informed Dvize that it had executed the 2012 Agreement or whether, and if so when, it sent Dvize a copy of the 2012 Agreement signed by BDC.
  25. Mr Shaya says that the same procedure was subsequently followed with respect to the STANLEY licence agreement.
  26. The 2012 Agreement

  27. Under the 2012 Agreement BDC granted Dvize a non-exclusive licence to manufacture (and sub-contract manufacture), import and sell Licensed Products bearing the trade marks identified in Schedule 2 to the 2012 Agreement in the Territory defined in Schedule 3 from 1 January 2012 to 31 December 2016. Clause 30 of the 2012 Agreement was in the following terms:
  28. “The validity, construction and performance of this Agreement shall be governed by the law of England and Wales and shall be subject to the exclusive jurisdiction of those courts.”

  29. Although Schedule 2 to the 2012 Agreement does not expressly identify the Trade Marks, it is common ground that the licence granted to Dvize under the 2012 Agreement must be interpreted as extending to the Trade Marks. If it were otherwise, Dvize would have infringed the Trade Marks during the currency of the 2012 Agreement.
  30. The Middle East Licence

  31. According to Mr Van Oort in a part of his first witness statement that was not challenged by Mr Datta or Mr Shaya, during 2012 Henry Surtees of SBD approached Dvize to look into the possibilities for the garden hand tools market in Saudi Arabia, Qatar and United Arab Emirates (“UAE”), which were not covered by the 2012 Agreement. This led to a Licence and Agency Agreement dated 30 August 2012 being agreed between Black & Decker Europe and Dvize for those countries (“the Middle East Licence”). Clause 3.5 of the Middle East Licence provided that the agreement would “commence on the date it is signed by duly authorised representatives of the Parties” and terminable on 30 days’ written notice. Mr Van Oort’s evidence is that Dvize sent Mr Surtees a signed copy of the Middle East Licence, but did not receive a copy countersigned by Black & Decker Europe. Nevertheless, both parties acted on the basis of the Middle East Licence.
  32. Negotiations over the Maryland Agreement

  33. In early 2016 the parties entered into negotiations for a new agreement which would take effect following the expiration of the 2012 Agreement. Although there are certain disputes on the evidence as to the course of these negotiations, there is also a considerable amount of common ground.
  34. On 25 January 2016 Marie Hawthorne, Mr Datta’s predecessor, sent Mr Van Oort and Mr Tertaas a licence renewal form to complete. On 4 February 2016 Mr Van Oort sent Ms Hawthorne an email, copied to Mr Tertaas and Mr Datta, attaching a completed copy of the renewal form. Schedule 2 of the completed form indicated that Dvize wanted to obtain a licence which extended to Saudi Arabia, Qatar and UAE in addition to the countries covered by the 2012 Agreement. On 15 February 2016 Ms Hawthorne sent Mr Van Oort an email saying that she had reviewed the renewal form and all looked like it was in good order. She continued:
  35. “Amit will follow up with you in due course to start the process for the new contract creation, we do not foresee any issues in moving forward to start the new contract.”

    After this, Ms Hawthorne went on maternity leave and Mr Datta took over from her.

  36. According to Mr Van Oort, on 2 March 2016 he and Mr Tertaas met John Cunningham (Vice President for Business Development) and Dean Grande (Director Global Licensing) of SBD in Miami. According to Mr Van Oort, the purpose of this meeting was “to finalise and conclude the process of renewing the 2012 Agreement with a handshake and a glass of champagne”. Mr Van Oort goes on to say:
  37. “At the meeting, we agreed with Mr Cunningham that we would renew and expand the existing business relationship with the Claimant to include the Middle East for another 5 years. Mr Cunningham said that he would instruct Mr Datta to send us a copy of the renewal agreement and arrange to visit Dvize in The Netherlands shortly thereafter to complete the renewal process.”

    Mr Van Oort also says that Mr Cunningham informed them that Beanstalk would not be involved and that all future contracts would be drafted by SBD’s legal team based in Maryland, and for that reason subject to Maryland law and jurisdiction.

  38. Two points should be noted about this evidence. First, Dvize does not contend that any binding agreement was concluded on 2 March 2016. Secondly, accordingly to this evidence, Mr Datta was to visit Dvize to complete the process. Although Mr Van Oort does not say so, it is difficult to see what could have been contemplated other than signature of the agreement by both parties.
  39. On 29 March 2016 Mr Van Oort sent Mr Cunningham an email, copied to Mr Datta and Mr Tertaas, saying that Dvize was in the process of entering into new agreements with customers, and therefore “we would like to receive a draft copy of the B+D Dvize renewal contract”. Mr Datta replied the same day saying the contract was being drafted by SBD’s legal team. BDC’s evidence is that, consistently with Mr Van Oort’s evidence about what he was told by Mr Cunningham, by this time SBD’s legal department had arranged that all licensing work would deal with by a team based in Maryland. Thus the new agreement became the responsibility of Bruce Shapiro (Senior Group Patent Counsel) rather than Mr Shaya.
  40. On 30 March 2016 Mr Van Oort responded saying it would be very helpful “if we can receive the respective draft shortly”. On 31 March 2016 Mr Datta replied saying:
  41. “I am chasing legal to speed up for you, should have an update soon. In the meantime let me reassure you that the renewal in principle has been approved and we work together on supporting your business. Of course the contract needs to be agreed and signed and I don’t see any major issues in the renewal.”

    Mr Van Oort replied the same day saying, “The written confirmation is necessary for us to take the next steps”.

  42. Counsel for Dvize accepted that Mr Datta’s statement that “the contract needs to be agreed and signed” was akin to stating that the agreement “in principle” to renew the licence was subject to contract. It is clear from Mr Van Oort’s response that he accepted this.
  43. On 5 April 2016 Mr Datta sent Mr Van Oort “the proposed Draft Contract for renewal” adding “Hope to receive your feedback soon”. The draft agreement attached to this email was expressed to be “made as of March 31, 2016 [sic]” with “an effective date of January 1, 2017”. It did not include Saudi Arabia, Qatar or UAE in the licensed territory (clause 1(n)). It did contain a Maryland law and exclusive jurisdiction clause (clause 24(i)). Clause 24(m) provided that “This Agreement may be executed in multiple counterparts, all of which together will constitute one agreement”. The signature page contained the following recital:
  44. “IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed in duplicate originals as of the date first written above.”

    The signature page provided for signatures on behalf of BDC, SBD, Dvize and LTM.

  45. On 5 April 2016 Mr Van Oort replied to Mr Datta acknowledging receipt of the draft agreement and saying “We will study and get back to you”.
  46. According to Mr Van Oort, on 4 May 2016 he spoke to Mr Datta on the telephone and suggested dates in May and June 2016 for Mr Datta to visit Dvize as promised by Mr Cunningham. Mr Van Oort confirmed these dates by email later the same day. On 11 May 2016 Mr Datta replied asking if any dates in June before 14 June would be possible. Mr Van Oort responded the same day suggesting 14 June.
  47. It appears that, during the telephone conversation, Mr Van Oort asked that the new agreement be extended to include Saudi Arabia, Qatar and UAE, because on 6 May 2016 Mr Van Oort sent Mr Datta an email referring to this request and providing further detail. On 17 May 2016 Mr Datta replied refusing to extend the new agreement to Saudi Arabia, Qatar and UAE. Mr Van Oort says that Dvize accepted this.
  48. Mr Van Oort’s evidence is that, on 19 May 2016 he signed the Maryland Agreement on behalf of Dvize and Mr Tertaas signed it on behalf of LTM. The signed agreement is stamped “behandelt” (“prepared”) on 18 May 2016 and Mr Van Oort’s and Mr Tertaas’ signatures are dated 19 May 2016. Mr Van Oort says that they signed it “in expectation of Mr Datta’s visit in June” because he and Mr Tertaas frequently travelled abroad and they “did not want the process of signing the Maryland Agreement to be frustrated when Mr Datta finally got round to visiting the Netherlands because one of us was away”. He goes on:
  49. “Although I expected the Maryland Agreement to be counter-signed on behalf of the Claimant, I thought this was a formality and did not think it was required for the agreement to be binding. As set out above, I believe that when we signed the Maryland Agreement on behalf of Dvize we accepted the Claimant’s offer of a new agreement on the terms set out in the Maryland Agreement and a binding agreement was concluded.”

  50. Notwithstanding Mr Van Oort’s evidence in this passage, counsel for Dvize did not submit that a binding agreement had been concluded when Mr Van Oort signed the Maryland Agreement.
  51. On 25 May 2016 there was a conference call between Mr Van Oort and Kyle Dancho (Vice-President of Licensing) and Mr Datta on behalf of BDC to discuss another issue concerning supplies by BDC’s licensee in other territories, Bond, to a distributor called EGT for supply to a customer called Carrefour. Mr Van Oort says that:
  52. “During this conference call, on a ‘matter of fact’ basis, I confirmed that Mr Tertaas and I had already signed the Maryland Agreement on behalf of Dvize. I recall that Mr Dancho’s response was that he was pleased we had done so and he stated that he was happy the Claimant had reached an agreement on renewal with Dvize.”

  53. Based on this evidence, it is Dvize’s case that at this point a binding oral agreement was made on the terms of the Maryland Agreement and any requirement for BDC to counter-sign the contract was waived by Mr Dancho on behalf of BDC.
  54. Mr Datta’s evidence is that he does not recall discussing the Maryland Agreement during the call. Furthermore, Mr Datta points out that an email sent by Mr Van Oort to Mr Dancho and himself later the same day makes no mention of Dvize having signed the Maryland Agreement. There is no evidence from Mr Dancho.
  55. On 14 June 2016 there was a telephone call between Mr Van Oort and Mr Datta. Mr Van Oort says that during this telephone call he “again confirmed that Dvize had accepted and signed the Maryland Agreement on behalf of Dvize”. Mr Datta says that Mr Van Oort’s recollection is incorrect.
  56. Later the same day, Mr Van Oort sent Mr Datta an email, copied to Mr Dancho and Mr Tertaas, saying:
  57. “As already discussed over the phone today, we need to arrange a meeting and discuss including these topics:

  • Carrefour/EGT progress and settlement.
  • Business with Action and others.
  • Clarifications and explanations on the renewal license contract.
  • adjustment of the conditions/compensation.”

He went on to propose some dates for the meeting.

  • As Mr Datta points out, Mr Van Oort’s email makes no mention of having signed the Maryland Agreement. Moreover, it is Mr Van Oort’s own evidence that, although LTM had signed the Maryland Agreement as guarantor, “we wanted to discuss whether the contract could be changed to drop this requirement”.
  • Mr Van Oort says that, after signing the Maryland Agreement and informing BDC that it had done so, Dvize hired new staff and invested in its business in reliance on the new agreement and what it had been told by BDC. Dvize’s investment in its business included purchasing new products and stock, enlarging and renewing its showroom, investing in new IT and engaging in extensive marketing to promote future sales of BDC’s products.
  • On 8 July 2016 Mr Datta sent Mr Van Oort an email suggesting a meeting or a telephone conversation (it is not clear which, as part of the email is missing) on 11 July 2016. Mr Van Oort replied the same day saying that 11 July was not possible, and proposing 12 July. On 11 July 2016 Mr Datta replied saying that 12 July was not possible and proposing 14 July.
  • Withdrawal of the Maryland Agreement

  • On 12 July 2016 Mr Datta sent Mr Van Oort an email, copied to Mr Dancho and Mr Tertaas, saying that SBD had decided to consolidate the garden hand tool business under one global partner (which was not identified in the email, but which Mr Van Oort correctly understood to be Bond). He went on:
  • “We withdraw the current B+D offer of renewal for DVIZE from 2017 by explicitly revoking the draft License renewal I sent you on 5th April 2016 …”

  • On 13 July 2016 Mr Van Oort sent an email to Mr Cunningham, copied to Mr Tertaas, expressing confusion at Mr Datta’s email and saying:
  • “Renewal status

    Apart from a number of small details the draft has been accepted and signed by us. We were supposed to have a concluding meeting in the Netherlands early June, however due to Amit’s intensive itinerary this meeting has been postponed.”

    Mr Van Oort received an automatic response to this email stating that Mr Cunningham was no longer employed by SBD.

  • Later the same day, Mr Van Oort sent an email to Mr Datta, copied to Mr Dancho, Mr Tertaas and Mr Grande, replying to Mr Datta’s email and expressing surprise. In the email to Mr Datta, Mr Van Oort did not say anything about accepting and signing the Maryland Agreement, but he did attach a copy of his email to Mr Cunningham. Mr Datta says that he overlooked the attachment when he received this email.
  • Be that as it may, it can be seen that, although Mr Van Oort said that the Maryland Agreement had been “accepted and signed” by Dvize in his email to Mr Cunningham, he also said that this was “Apart from a number of small details”. Moreover, he also said that there was supposed to be “a concluding meeting”, which in context must mean a meeting to conclude the contract.
  • Discussions about an extension to the 2012 Agreement for 2017 and discussions between Dvize and Bond

  • On 25 July 2016 there was a meeting between Mr Van Oort, Mr Tertaas and Mr Dancho in Farmington, Connecticut. In preparation for this meeting, Mr Van Oort sent Mr Dancho an email on 20 July 2016 saying:
  • “This renewal circus is going on now for more than 19 months, we are pleased being able to update you in full.”

  • Mr Van Oort says that, at the meeting, he “protested that the Claimant could not withdraw the Maryland Agreement as it had already been accepted” and “explained how Dvize had acted in reliance on the Claimant’s assurances”. Mr Dancho said that the decision to withdraw the Maryland Agreement had not been taken by him and that he would investigate the position.
  • On 27 July 2016 Mr Van Oort sent Mr Dancho an email, copied to Mr Tertaas, thanking him for his time and saying:
  • “It was a pleasure to have had the opportunity to explain Dvize it’s position, especially given the seasonable character of our business model. Since we have been fairly confused earlier, your update was very helpful to us.”

  • On 8 August 2016 Mr Datta sent Mr Shapiro an email, copied to Mr Dancho, saying that one of the possibilities Mr Dancho had discussed with Dvize was to extend the 2012 Agreement by one year, which would allow Dvize and Bond time to manage the handover.
  • On 5 September 2016 Mr Datta sent Mr Van Oort an email, copied to Mr Tertaas, saying:
  • “I understand from Kyle that your meeting with him was positive and you discussed extension for 2017 on the contract for DVIZE.”

    Mr Van Oort says that this is incorrect, but there is no evidence that he replied correcting Mr Datta.

  • According to Mr Van Oort, in early September 2016 he met Cam Jenkins of Bond at the GAFA trade show. Mr Jenkins said that it would be “too complicated” for Bond to take over distribution of products in most of Europe, other than certain key countries, and therefore Dvize would be able to keep its existing business across Europe.
  • Mr Van Oort says that on 13 September 2016 he spoke to Mr Datta and that the conversation was summarised in an internal email from Mr Datta to Mr Dancho exhibited by Mr Datta. In the email Mr Datta said:
  • “Just a quick heads up, I spoke to Peter while he is here for Glee show, he confirmed that DVIZE and Bond had a good meeting to find a way forward and they plan to meet again around the canton Fair in China in mid-October where Bond will come back to them with a proposal. He mentioned that CAM was looking to find a way to keep the existing markets/customers with DVIZE, he also mentioned about your meeting with him on extension for 2017 and was aware no decision is made as yet and looks forward to CAM/SBD thinking on what may be the best way forward, since he seem to have some reassurance that DVIZE will still have the business directly or indirectly.”

    It can be seen that this email supports what Mr Datta had said in his 5 September email.

  • On 23 November 2016 Mr Van Oort sent Mr Dancho and Mr Datta an email, copied to Mr Tertaas, drawing attention to an email Dvize had received earlier the same day from SBD noting that Dvize’s customs authorization letter from BDC, which confirmed that Dvize was authorized to use the BLACK + DECKER trade mark, expired on 31 December 2016 and asking them “to confirm the authorization extension to the SBD staff responsible”.
  • On 14 December 2016 Mr Shapiro prepared and Mr Dancho signed a letter “to whom it may concern” stating that Dvize was licensed and authorised by BDC to use the BLACK + DECKER trade mark on specified products and that the licence and authorization “expire December 31, 2017, unless earlier terminated” (“the Consent Letter”). The Consent Letter does not contain a jurisdiction clause. It seems clear from the evidence that BDC sent the Consent Letter to Dvize, but it is not clear how or when.
  • Mr Van Oort says this was done unilaterally by BDC and without Dvize’s agreement. Mr Van Oort also say that on 15 December 2016 he telephoned Mr Datta expressing his surprise at the Consent Letter and that it purported to be only for 12 months given the existence of the signed Maryland Agreement. Mr Datta responded that he understood the point, but could not extend the Consent Letter beyond 12 months at short notice.
  • On 3 March 2017 there was a meeting in Tucson, Arizona between Mr Dancho and Mr Datta on behalf of BDC, Mr Van Oort and Mr Tertaas on behalf of Dvize and Mr Jenkins and Yannick Cartailler on behalf of Bond. According to Mr Van Oort, Bond stated that it intended to terminate its proposed distribution cooperation with Dvize. As a result, Dvize stated that it would hold BDC to the signed Maryland Agreement.
  • Later the same day Mr Van Oort sent Mr Jenkins an email, copied to Messrs Dancho, Datta, Grande and Tertaas, raising issues which needed to be taken into consideration. On 7 March 2017 Mr Van Oort sent a further email setting out proposals for a transition from Dvize to Bond and compensation of Dvize.
  • On 6 April 2017 Mr Jenkins sent Mr Datta a draft Memorandum of Understanding (“MOU”) between Bond and Dvize in respect of the proposed transition from Dvize to Bond, and on 10 April 2017 Mr Datta forwarded this to Mr Van Oort. Under the MOU, it was envisaged that Bond would purchase all Dvize’s inventory and goodwill and take over as BDC’s licensee in Europe with effect from 1 January 2018. On 11 April 2017 Mr Van Oort acknowledged receipt of the MOU and said that Dvize would study and revert with a detailed response.
  • On 11 May 2017 Mr Van Oort sent an email to representatives of BDC and Bond saying that it taken legal advice, and had been advised that the Maryland Agreement had been concluded because SBD had made an offer which Dvize had accepted:
  • “… the new contract was brought to us by courier, without reservations or exceptions. We then accepted the offer, signed the agreement, confirmed all of this by email and were looking forward to continuing the cooperation between Dvize and SBD”

    He went on to say that Dvize was only prepared to discuss handing over the business to Bond if it was fully compensated.

  • On 2 June 2017 Mr Shaya sent Mr Van Oort an email in response, denying that the Maryland Agreement had been concluded, referring to the Consent Letter and attaching a proposed amendment to the 2012 Agreement. There was then a further exchange of emails on 6 June 2017 and 9 June 2017.
  • On 14 June 2017 Dvize’s Dutch lawyer sent an email to Mr Shaya which amounted to a letter before action. Mr Shaya replied on 15 June 2017.
  • On 20 June 2017 Dvize sent BDC a copy of the signed Maryland Agreement for the first time.
  • On 4 September 2017 there was a meeting between the parties at the GAFA trade fair, at which Dvize repeated its position that BDC was bound by the Maryland Agreement and BDC disputed this. Later the same day Mr Van Oort sent Ms Hawthorne an email, copied to Mr Dancho and Mr Tertaas, saying:
  • “Following your suggestion I’ve had a meeting with Cam Jenkins of Bond.

    As expected we have not reached an agreement on any form of transition.

    Current state of affairs is:

    Bond signed the B+D global non exclusive license agreement until the end of 2020.

    Dvize has signed the renewal of the European non exclusive license agreement until the end of 2021.

    We (Bond & Dvize) are of the opinion that caused this problem and if desired SBD should propose their proposals for solution.

    For now Dvize will ensure the continuity of supply of B+D/Stanley products to its customers in order to avoid the loss of credibility.”

  • On 5 September 2017 Ms Hawthorne reiterated that no contract had been concluded and said that she was handing the matter over to the SBD legal team.
  • The Maryland proceedings

  • On 13 September 2017 a firm of US lawyers instructed by Dvize wrote to BDC’s solicitors asserting that the Maryland Agreement had governed the parties’ relationship since 1 January 2017 and asking for an assurance that SBD would honour the agreement, failing which Dvize would commence proceedings in Maryland and seek temporary injunctive relief.
  • On 20 September 2017 Dvize issued proceedings against BDC and SBD before the Circuit Court for Baltimore County in Maryland seeking an injunction and damages on the basis that the Maryland Agreement was a binding and enforceable contract (“the Maryland Proceedings”). The Maryland Proceedings were commenced relying on the exclusive jurisdiction clause in the Maryland Agreement. Dvize has not served the Maryland Proceedings on BDC and SBD, however, and would now require the permission of the Circuit Court to do so. Moreover, Dvize’s lawyers have ceased to act for it. Dvize’s explanation for these matters is that it has had to concentrate its resources on the present proceedings.
  • These proceedings

  • On 21 September 2017 BDC issued the Claim Form in the present proceedings. Under the heading “Brief details of claim”, the Claim Form first recited that BDC had licensed Dvize to use the Trade Marks by virtue of the 2012 Agreement which terminated on 31 December 2016. It went on:
  • “The Claimant unilaterally allowed the Defendant to continue using the Trade Marks until December 31st 2017. That permission was subsequently withdrawn by the Claimant and the Defendant’s ongoing sale of goods under or by reference to the Trade Marks constitutes infringement of the Claimant’s trade mark rights.”

  • As at 21 September 2017, the statement that BDC had withdrawn the consent granted by the Consent Letter was inaccurate. On 22 September 2017, however, BDC’s solicitors wrote to Dvize withdrawing BDC’s consent under the Consent Letter with effect from 9 October 2017, notifying it that BDC had issued the proceedings and stating that, unless Dvize gave certain undertakings, BDC intended to issue an application for “expedition and/or injunctive relief”.
  • BDC served its Claim Form under cover of a letter dated 2 October 2017. On 9 October 2017 BDC served its Particulars of Claim and application for an interim injunction.
  • Relevant provisions of the EUTM Regulation

  • The EUTM Regulation includes the following provisions:
  • Article 9

    Rights conferred by an EU trade mark

    1. The registration of an EU trade mark shall confer on the proprietor exclusive rights therein.

    2. Without prejudice to the rights of proprietors acquired before the filing date or the priority date of the EU trade mark, the proprietor of that EU trade mark shall be entitled to prevent all third parties not having his consent from using in the course of trade, in relation to goods or services, any sign where:

    (a) the sign is identical with the EU trade mark and is used in relation to goods or services which are identical with those for which the EU trade mark is registered;

    …

    3. The following, in particular, may be prohibited under paragraph 2:

    (a) affixing the sign to the goods or to the packaging of those goods;

    (b) offering the goods, putting them on the market, or stocking them for those purposes under the sign, or offering or supplying services thereunder;

    (c) importing or exporting the goods under the sign;

    (d) using the sign as a trade or company name or part of a trade or company name;

    (e) using the sign on business papers and in advertising;

    (f) using the sign in comparative advertising in a manner that is contrary to Directive 2006/114/EC.

    …

    Article 124

    Jurisdiction over infringement and validity

    The EU 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 EU trade marks;

    …

    Article 125

    International jurisdiction

    …

    5. Proceedings in respect of the actions and claims referred to in Article 124, with the exception of actions for a declaration of non-infringement of an EU trade mark, may also be brought in the courts of the Member State in which the act of infringement has been committed or threatened, or in which an act referred to in Article 11(2) has been committed.

    Article 126

    Extent of jurisdiction

    …

    2. An EU trade mark court whose jurisdiction is based on Article 125(5) shall have jurisdiction only in respect of acts committed or threatened within the territory of the Member State in which that court is situated.

    Article 129

    Applicable law

    1. The EU trade mark courts shall apply the provisions of this Regulation.

    2. On all trade mark matters not covered by this Regulation, the relevant EU trade mark court shall apply the applicable national law.

    …

    Article 131

    Provisional and protective measures

    1. Application may be made to the courts of a Member State, including EU trade mark courts, for such provisional, including protective, measures in respect of an EU trade mark or EU trade mark application as may be available under the law of that State in respect of a national trade mark, even if, under this Regulation, an EU trade mark court of another Member State has jurisdiction as to the substance of the matter.

    …”

    BDC’s claim for infringement of the Trade Marks

  • BDC’s principal claim for infringement of the Trade Marks is under Article 9(2)(a) of the EUTM Regulation, although it also relies upon Article 9(2)(b) and (c). As counsel for BDC pointed out, it is important to note that, as at the dates of both the Claim Form and the Particulars of Claim, BDC’s claim for infringement of the Trade Marks was a quia timet one.
  • In the Particulars of Claim BDC recites that the 2012 Agreement came to an end on 31 December 2016, that the Maryland Agreement was not entered into, that it unilaterally allowed Dvize to continue using the Trade Marks pursuant to the Consent Letter and that it withdrew such consent with effect from 9 October 2017 by the letter dated 22 September 2017. BDC then pleads Mr Van Oort’s email dated 4 September 2017 (see paragraph 64 above) and continues:
  • “In the premises, the Defendant considers that it is entitled to continue to act as a non-exclusive licensee until 31 December 2021 being the date on which they say the Draft Maryland Agreement expires. Accordingly, the Defendant has continued to manufacture, market and sell goods under the Registered Trade Marks, including offering to sell and advertising in the UK as well as throughout the remainder of the EU.”

  • Although this plea extends to the remainder of the EU, as noted above, BDC only contends that this Court has jurisdiction under Article 125(5) of the EUTM Regulation. As is common ground, by virtue of Article 126(2), Article 125(5) only confers jurisdiction in respect of acts committed or threatened within the UK. Furthermore, although this plea alleges that Dvize “has continued” to use the Trade Marks in the UK, counsel for BDC concentrated his argument upon what Dvize has threatened to do after 9 October 2017.
  • Dvize’s defence to the claim

  • Dvize’s defence to the claim is two-fold. First, Dvize denies that it has committed or threatened to commit any relevant act within the UK (as opposed elsewhere in the EU) after 9 October 2017. It is common ground that the burden of proof on this issue lies upon BDC.
  • Secondly, Dvize contends that BDC has consented to its use of the Trade Marks by virtue of the Maryland Agreement alternatively that BDC is estopped from denying this. It is common ground that the burden of proof on this issue lies upon Dvize.
  • Dvize’s application to challenge the jurisdiction

    Applicable principles

  • Article 125(5). The Court of Justice of European Union has held that the jurisdictional rules contained in Article 125 of the EUTM Regulation have the character of a lex specialis in relation to the jurisdictional rules provided for by the Brussels I Recast Regulation: see Case C-360/12 Coty Germany GmbH v First Note Perfumes NV [EU:C:2014:1318], [2014] ETMR 49 at [27] and Case C-617/15 Hummel Holding A/S v Nike Inc [EU:C:2017:390], [2017] Bus LR 1864 at [26] and cf. Case C-433/16 Bayerische Motoren Werke AG v Acacia Srl [EU:C:2017:550], [2017] ECDR 18 at [39] and Joined Cases C-24/16 and C-25/16 Nintendo v BigBen Interactive GmbH [EU:C:2017:724] at [42] (concerning Article 82 of Council Regulation 6/2002/EC of 12 December 2001 on Community designs).
  • Guidance on the interpretation of Article 125(5) was provided by the CJEU in Coty Germany. In that case the defendant was domiciled in Belgium. It sold a consignment of perfume to a distributor based in Germany. The distributor took delivery of the goods in Belgium and re-sold them in Germany. The claimant brought proceedings for Community trade mark infringement against the defendant in Germany. The Bundesgerichtshof (Federal Court of Justice) referred questions to the CJEU concerning the interpretation of Article 93(5) of Regulation 40/94/EC (the predecessor to Article 125(5) of the EUTM Regulation) and Article 5(3) of Regulation 44/2001/EC (the predecessor to Article 7(2) of the Brussels I Recast Regulation). In answer to the first question, the CJEU held as follows:
  • “31.     With regard to the interpretation of Article 93(5), in the light of the findings in paragraphs 27 and 28 above, the concept of ‘the Member State in which the act of infringement has been committed or threatened’, referred to in that provision, must be interpreted independently of the concept of ‘the place where the harmful event occurred or may occur’ referred to in Article 5(3) of Regulation No 44/2001.

    32.       Consequently, the duality of linking factors, namely the place of the event giving rise to the damage and that where the damage occurred, accepted by the Court’s case-law relating to Article 5(3) of Regulation No 44/2001 (see Case 21/76 Bier, EU:C:1976:166, paragraph 19, and, most recently, Case C-45/13 Kainz, EU:C:2014:7, paragraph 23 and the case-law cited), cannot automatically apply to the interpretation of the concept of ‘the Member State in which the act of infringement has been committed or threatened’ in Article 93(5) of Regulation No 40/94.

    33.       In order to determine whether an independent interpretation of the latter provision nevertheless leads to an acknowledgement of such a duality of linking factors, it is necessary, in accordance with the Court’s settled case-law, to take into account not only the wording of that provision, but also its context and purpose.

    34.       With regard to the wording of Article 93(5) of Regulation No 40/94, the concept of ‘the Member State in which the act of infringement has been committed’ implies, as the Advocate General stated in point 31 of his Opinion, that that linking factor relates to active conduct on the part of the person causing that infringement. Therefore, the linking factor provided for by that provision refers to the Member State where the act giving rise to the alleged infringement occurred or may occur, not the Member State where that infringement produces its effects.

    35.       It should also be noted that the existence of jurisdiction under Article 93(5) based on the place where the alleged infringement produces its effects would conflict with the wording of Article 94(2) of that regulation, which limits the jurisdiction of Community trade mark courts under Article 93(5) to acts committed or threatened in the Member State where the court seised is situated.

    36.       Furthermore, as the Advocate General stated in points 28 and 29 of his Opinion, both the origin and the context of Regulation No 40/94 confirm the intention of the EU legislature to derogate from the rule on jurisdiction provided for in Article 5(3) of Regulation No 44/2001 in the light, in particular, of the inability of the rule on jurisdiction to respond to the specific problems relating to the infringement of a Community trade mark.

    37.       Consequently, jurisdiction under Article 93(5) of Regulation No 40/94 may be established solely in favour of Community trade mark courts in the Member State in which the defendant committed the alleged unlawful act.

    38.       In the light of the foregoing, the answer to Question 1 is that the concept of the ‘Member State in which the act of infringement has been committed’ in Article 93(5) of Regulation No 40/94 must be interpreted as meaning that, in the event of a sale and delivery of a counterfeit product in one Member State, followed by a resale by the purchaser in another Member State, that provision does not allow jurisdiction to be established to hear an infringement action against the original seller who did not himself act in the Member State where the court seised is situated.”

  • It is common ground in the light of this guidance that BDC bears the burden of establishing that Dvize has “committed or threatened” to commit an infringing act in the UK. It is not sufficient for BDC to show that that is where the damage occurred or would occur.
  • Standard of proof. It is common ground that, even though Article 125(5) of the EUTM Regulation is a directly-applicable provision of EU law, the relevant standard of proof of the jurisdictional requirements it imposes is that of a “good arguable case”: cf. Bols Distilleries v Superior Yacht Services Ltd [2006] UKPC 45, [2007] 1 WLR 12 at [28] (Lord Rodger of Earlsferry) (concerning what is now Article 25 of the Brussels I Recast Regulation). (BDC must also show that it has a real prospect of success on the merits, but there is no dispute that, if BDC can show that it has a good arguable case on the jurisdictional issues, then it will also have a real prospect of success on the merits.)
  • In Brownlie v Four Seasons Holdings Inc [2017] UKSC 80, Lord Sumption (with whom the other members of the Supreme Court agreed on this point) explained that the test of “good arguable case” had been established by the decisions of the House of Lords in Vitkovice Horni a Hutni Tezirstvo v Korner [1951] AC 869 and Seaconsar Far East Ltd v Bank Mrkazi Jomhouri Islami Iran [1994] 1 AC 438. He went on at [7]:
  • “An attempt to clarify the practical implications of these principles was made by the Court of Appeal in Canada Trust Co v Stolzenberg (No 2) [1998] 1 WLR 547. Waller LJ, delivering the leading judgment observed at p 555:

    ‘”Good arguable case” reflects … that one side has a much better argument on the material available. It is the concept which the phrase reflects on which it is important to concentrate, ie of the court being satisfied or as satisfied as it can be having regard to the limitations which an interlocutory process imposes that factors exist which allow the court to take jurisdiction.’

    When the case reached the House of Lords, Waller LJ’s analysis was approved in general terms by Lord Steyn, with whom Lord Cooke and Lord Hope agreed, but without full argument: [2002] AC 1, 13. The passage quoted has, however, been specifically approved twice by the Judicial Committee of the Privy Council: Bols Distilleries (trading as Bols Royal Distilleries) v Superior Yacht Services Ltd [2007] 1 WLR 12, para 28, and Altimo Holdings, loc cit. In my opinion it is a serviceable test, provided that it is correctly understood. The reference to ‘a much better argument on the material available’ is not a reversion to the civil burden of proof which the House of Lords had rejected in Vitkovice. What is meant is (i) that the claimant must supply a plausible evidential basis for the application of a relevant jurisdictional gateway; (ii) that if there is an issue of fact about it, or some other reason for doubting whether it applies, the Court must take a view on the material available if it can reliably do so; but (iii) the nature of the issue and the limitations of the material available at the interlocutory stage may be such that no reliable assessment can be made, in which case there is a good arguable case for the application of the gateway if there is a plausible (albeit contested) evidential basis for it. I do not believe that anything is gained by the word ‘much’, which suggests a superior standard of conviction that is both uncertain and unwarranted in this context.”

  • Counsel for BDC submitted that, in the context of Article 125(5) of the EUTM Regulation, it was sufficient for BDC to establish that it had a good arguable case that Dvize had “committed or threatened” an act amounting to use of the Trade Marks within Article 9(3) of the EUTM Regulation in the UK, and it did not also have to show that it had a good arguable case on the issue of consent. Counsel for Dvize submitted that BDC also had to establish that it had a good arguable case on the issue of consent, since there could be no infringement if there was consent. Neither side cited any authority which sheds any light on this question, and accordingly I must consider it as a matter of first impression. I have concluded that counsel for BDC is correct, because consent is a defence on the merits and one which must be proved by Dvize. As will appear, however, in the present case it makes no difference even if counsel for Dvize is correct.
  • Assessment

  • Good arguable case of a threat to use the Trade Marks in the UK? In considering whether BDC has a good arguable case that Dvize has threatened to use the Trade Marks in the UK after 9 October 2017, the starting point is consider what amounts to a “threat” for this purpose. Although Article 125(5) is directly-applicable EU law, I consider that it is well arguable that it should interpreted as involving a similar test to that applied in domestic law. Birss J considered the latter in Merck Sharp Dohme Corp v Teva Pharma BV [2013] EWHC 1958 (Pat), [2014] FSR 13 at [39]-[59]. Having reviewed the authorities, he stated the applicable principle at [56] in the following terms:
  • “The principle I derive from these authorities is that the question the court is asking in every case is whether, viewed in all the relevant circumstances, there was a sufficiently strong probability that an injunction would be required to prevent the harm to the claimant to justify bringing the proceedings. In adding the word sufficiently to the word strong … I am seeking to encapsulate the idea that the degree of probability required will vary from case to case depending on all the circumstances but that mere possibilities are never enough. To justify coming to court requires there to be a concrete, strong and tangible risk that an injunction is required in order to do justice in all the circumstances.”

  • Counsel for BDC relied upon a number of pieces of evidence as showing that there was a threat by Dvize to commit acts amounting to use of the Trade Marks in the UK.
  • First, Dvize positively asserts that it is entitled to use the Trade Marks throughout the EU, including the UK, by virtue of the Maryland Agreement. Clause 2(a) of the Maryland Agreement grants Dvize a licence “to use in the Territory the Marks solely for the Licensed Products and with Packaging Materials and Advertising Materials therefor, and to sell distribute and advertise the Licensed Products in the Territory”.
  • Secondly, in a letter from Dvize’s solicitors to BDC’s attorneys dated 7 December 2017, Dvize offered to submit to a consent order providing that, if this Court decided that it had jurisdiction over BDC’s claim for trade mark infringement, then Dvize undertook until the conclusion of the trial or further order that it would not “whether acting by its directors, servants, agents, employees or otherwise howsoever, manufacture, sell, offer or expose for sale within the UK any products using” the Trade Marks in return for a cross-undertaking in damages from BDC. Counsel for BDC pointed out that (i) no offer of a permanent undertaking had been made by Dvize and (ii) no offer of an interim undertaking had been made in the event that this Court concluded that it did not have jurisdiction.
  • Thirdly, Mr Dubash says in paragraph 69 of his witness statement:
  • “… I believe that the place where the alleged act of infringement has been committed or threatened is likely to be the Netherlands where the Defendant is based. This is because that is where the Defendant took the decision and/or took the relevant steps to continue to produce and market goods carrying the Claimant’s Trade Marks for sale in the UK and elsewhere in the EU after the purported termination of the Consent Letter. In this regard, I understand from Mr Van Oort that the Defendant has had a distributor in the UK, NAP Brands (‘NAP’), since 2013. NAP has been selling Stanley branded garden hand tools (which are not relevant to the Claimant’s claim) to retailers in the UK and offering Black & Decker branded garden hand tools for sale on the Amazon UK website.”

    Counsel for BDC submitted that it was a reasonable inference from this evidence, given that Mr Dubash had not said that property to the goods passed in the Netherlands, that Dvize sold the goods to NAP in the UK.

  • Fourthly, Mr Dubash says in paragraph 80 of his statement:
  • “Even if only a UK wide injunction is granted, it is likely to cause significant damage to the Defendant’s reputation and its business.”

    Counsel for BDC submitted that a UK injunction could only cause significant damage to Dvize’s business if it prevented Dvize from doing acts in the UK which it would otherwise do.

  • Fifthly, Mr Van Oort says in paragraph 8 of his second witness statement:
  • “Dvize’s sales were also affected by the fact that the Claimant/SBD had permitted Bond to supply large volumes to another distributor, EGT, in France and Bond also supplied products directly to Homebase in the UK.”

    Counsel for BDC submitted that this evidence amounted to a complaint that Dvize had lost sales in the UK to Bond, and that there was no suggestion that Dvize had changed its marketing methods since 9 October 2017.

  • Sixthly, Mr Van Oort says in paragraph 46 of his second statement:
  • “Dvize intends to comply with the requirements for distribution channels under the Maryland Agreement.”

    Clause 3(c) of the Maryland Agreement provides that:

    “Dvize may sell the Licensed Products only through the following Channels of Trade:

    Do-It-Yourself (DIY) Multiples, Catalogue Stores, Wholesalers, Mail Order, DIY Catalogue Stores, Builders Merchants, Hardware Stores, E-Commerce, Specialist Hardware Stores, Department Stores, Garden Centres, General Wholesalers, Supermarkets, Hypermarkets and Independent Stores.”

  • Counsel for Dvize submitted that none of these pieces of evidence, whether individually or cumulatively, established a good arguable case that Dvize was threatening to do any act amounting to use of the Trade Marks in UK. He relied on paragraph 69 of Mr Dubash’s statement as being an accurate statement of the position, and submitted that, if BDC contended that property to the goods passed in the UK, then the burden lay on BDC to adduce evidence to support that contention.
  • In my judgment, the evidence relied upon by BDC does establish a good arguable case that Dvize threatens to use the Trade Marks in the UK. Given the nature of the issue and the limitations of the material available at this stage, it is difficult to make a firm assessment of the strength of the case, but the first, second and fourth pieces of evidence in particular seem to me to demonstrate at the very least a plausible basis for BDC’s contention. Those matters do not depend on an investigation of where property passed when goods were previously supplied by Dvize to NAP. Nor do they depend on an investigation of the precise mechanism by which NAP previously sold goods to consumers (and for that reason, it is unnecessary for me to consider certain authorities which were cited to me concerning the use of trade marks on websites). Rather they go to what, on an objective assessment, Dvize has threatened to do after 9 October 2017.
  • Given that conclusion, it is not necessary for me to consider counsel for BDC’s fall-back position, but I will do so in case I am wrong on that point. His fall-back position was to argue that, even if Dvize had not threatened itself to use the Trade Marks in the UK, there was a clear threat that NAP would do so, and that Dvize would be liable for such use as a joint tortfeasor.
  • The EUTM Regulation does not harmonise the conditions for accessory liability for infringement of EU trade marks. It is therefore generally assumed that national law is applicable to such issues by virtue of Article 129(2) of the EUTM Regulation. Accordingly, there is no dispute that the relevant law in the present case is English law.
  • Counsel for Dvize pointed out, correctly, that no case that Dvize was or would be jointly liable for infringements of the Trade Marks committed by NAP was currently pleaded in the Particulars of Claim. I see no reason, however, why BDC should not be allowed, if necessary, to amend the Particulars of Claim to advance such a case. (Most of the items of evidence considered above are not pleaded in the Particulars of Claim either, but counsel for Dvize did not submit that that precluded BDC from relying upon them.)
  • Counsel for Dvize also relied upon the statement of Sir Robin Jacob in Football Dataco Ltd v Stan James plc [2013] EWCA Civ 27, [2013] Bus LR 837 at [91] that “a seller [of physical goods] is not a joint tortfeasor [with the purchaser] … where the seller of infringing goods is abroad and is not himself responsible for the importation of the goods, as where under a c.i.f. contract the property passes abroad and the carrier is the buyer’s agent not the seller”.
  • Since then, however, the law has been reviewed by the Supreme Court in Fish & Fish Ltd v Sea Shepherd UK [2015] UKSC 10, [2015] AC 1229. The Supreme Court held, to adopt the summary in the headnote to the report, that
  • “in order to be liable with a principal tortfeasor a defendant had to be proved to have combined with the principal tortfeasor to do, or to secure the doing of, acts which constituted the tort; that that required proof that the defendant had acted in a way which furthered the commission of the tort by the principal tortfeasor and that he had done so in pursuance of a common design to do, or to secure the doing of, the acts which constituted the tort; and that whether the matters relied on by a claimant had any significance to the commission of the tort would depend on the circumstances in each case.”

    As both the concluding clause and the fact that the members of the Supreme Court, although essentially agreed as to the law, were divided 3-2 as to its application to the facts indicate, whether the defendant has “acted in a way which furthered the commission of the tort” is an acutely fact-sensitive question.

  • In the present case, Mr Dubash says that NAP has been Dvize’s “distributor” of goods bearing the Trade Marks since 2013. Furthermore, Mr Dubash says that Dvize “took the decision and/or took the relevant steps to continue to … market goods carrying the … Trade Marks for sale in the UK” after 9 October 2017. In my judgment, on the present state of the evidence, BDC has a plausible basis for contending that, even assuming that property passes outside the UK, the relationship between Dvize and NAP involves more than the mere arm’s-length sale of the goods, and accordingly that Dvize threatens to act in a way which furthers the commission of infringing acts in pursuance of a common design with NAP to secure the doing of such acts.
  • Good arguable case on the issue of consent? In my judgment, BDC also has a good arguable case on the issue of consent. As noted above, the burden of proof lies on Dvize on this issue. Given the nature of the issue and the limitations of the material available at this stage, it is difficult to make a firm assessment of the strength of the case, but it seems to me that Dvize faces a number of significant hurdles.
  • First, there is the evidence of a prior course of dealing between the parties by which a written agreement would only become binding when signed by both parties. (On the other hand, the Middle East Licence may show that this was not treated as essential.)
  • Secondly, there is Mr Datta’s statement in his email dated 31 March 2016 (paragraph 27 above) that “the agreement needs to be agreed and signed”, which was akin to statement that it was subject to contract (see paragraph 28 above).
  • Thirdly, there is the fact that the Maryland Agreement provided for the execution of counterparts (see paragraph 29 above).
  • Fourthly, Mr Van Oort’s evidence with respect to the signing of the Maryland Agreement on 19 May 2016 (see paragraph 33 above) shows that, at that time, he expected Mr Datta to visit the Netherlands to counter-sign it. His evidence that he regarded Mr Datta’s counter-signature as a formality does not assist Dvize, because Dvize does not contend that a binding agreement had been concluded at that stage (see paragraph 34 above).
  • Fifthly, even taking Mr Van Oort’s account of the conference call on 25 May 2016 (see paragraph 35 above) entirely at face value, it is arguable that it remained in the contemplation of the parties that the Maryland Agreement would only become binding when signed by BDC.
  • Sixthly, it is arguable that Mr Van Oort’s email dated 14 June 2016 shows that aspects of the agreement remained to be finalised at that date (see paragraphs 39 and 40 above).
  • Seventhly, there is the fact that Dvize did not state in writing that it had signed the Maryland Agreement until after BDC had withdrawn it (see paragraph 44 above), and even then Mr Van Oort did so in terms which indicated that a meeting to conclude the contract had been expected (see paragraph 46 above).
  • Eighthly, if it is concluded that what the parties contemplated was that the Maryland Agreement would only become binding when signed by both parties, then Dvize will face difficulties in establishing an unequivocal representation by BDC that its signature was not required so as to found an estoppel.
  • Conclusion. For the reasons given above, I conclude that this Court has jurisdiction in respect of BDC’s claim for infringement of the Trade Marks in the UK.
  • BDC’s application for an interim injunction

  • Given my conclusion on jurisdiction, Dvize’s offer of an undertaking makes it unnecessary for me to consider the merits of BDC’s application for an interim injunction. In case I am wrong on jurisdiction, however, I will briefly do so.
  • As noted above, if this Court lacks jurisdiction, BDC invokes Article 131 of the EUTM Regulation. Counsel for Dvize submitted that the Court had no jurisdiction to grant an interim injunction, alternatively any jurisdiction should not be exercised, because the phrase “provisional, including protective, measured” should be interpreted in the same manner as the same phrase in Article 35 of the Brussels I Recast Regulation, namely as meaning “measures which … are intended to preserve a factual or legal situation so as to safeguard rights the recognition of which is otherwise sought from the court having jurisdiction as to the substance of the case”: see Case C-104/03 St. Paul Daily Industries NV v Unibel Exser BVBA [2005] ECR I-3481 at [13]. He further submitted that in the present case Dvize was not seeking to preserve the status quo as it existed prior to 9 October 2017.
  • I accept the phrase should be interpreted in the manner suggested by counsel for Dvize, but I do not accept that this leads to the conclusion for which he contends. BDC is seeking to preserve a situation in which, on BDC’s case, Dvize should not be using the Trade Marks after 9 October 2017, because it has no licence to do so, in order to safeguard the Trade Marks.
  • Moreover, I consider that Dvize’s offer of an undertaking if the Court has jurisdiction represents a realistic assessment of where the balance of the risk of injustice lies. BDC has licensed Bond to use the Trade Marks in the EU, including the UK, and Mr Datta states that Bond will begin selling goods bearing the Trade Marks in Europe by Christmas 2017. It is bound to be confusing to customers, and detrimental to the reputation of the Trade Marks, if the two licensees are fighting over the same market. The resulting damage to BDC will be difficult to quantify, and there is some doubt as to whether Dvize will be able to pay any substantial sum in damages. By contrast, Dvize’s sales since 2012 will provide a reasonable basis for assessing damages under the cross-undertaking if Dvize is successful at trial, and there is no doubt that BDC will be able to pay. Accordingly, if it were necessary to do so, I would grant an interim injunction pursuant to Article 131.


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