Parties


In the High Court (Chancery Division), March 2006

Introduction

This was a case about trade mark infringement in wristwatches, although the basis for some of the infringement claims were based on the use of domain names. Klaus Kobec Ltd was in administration and had settled the case, so Mr Cohen proceeded as the only defendant.

Background

Mr Fields had been selling jewellery for many years. Mr Cohen started selling  watches supplied by Mr Fields direct on the streets. In time, Mr Cohen took over a business that Mr Fields had been running, selling watches via hotel showcases and it was (apparently jointly) decided to market an upmarket brand that they would call KLAUS KOBEC. The origin of this name was disputed, but a trade mark registration was made in August 1996 jointly between Mr Fields and "Klaus Kobec Ltd" (which did not exist at that time, but a similarly named company was run by Mr Cohen). Klaus Kobec Ltd was then founded and jointly owned, and in 2000 Mr Fields alone obtained a Community trade mark.

Business went well, and Mr Fields continue to supply all the watches. Separately, Klause Kobec Ltd sold sunglasses and other items with the Klaus Kobec name on them without any objection from Mr Field. A lucrative line of business was opened up selling "limited edition" watches to football clubs (with club logos etc) which sold for £75 - the club got £28 per watch at no cost to them. Until 2002 these watches were supplied by Mr Field's companies.

For various reasons Mr Cohen then sought to source the watches from companies unrelated to Mr Fields. The relationship ran into trouble, but was patched up.

In 2004 Klaus Kobec registered <klauskobecfootball.com>, <klauskobec.com>, and <klauskobecrugby.com> and started to promote the football brand. Business under the football brand developed and by late 2004 the KLAUS KOBEC name started to be removed from packaging and watches and "thefootballwatchshop.com" branding added, with the Klaus Kobec name now only used in the company name. This "footballwatchshop.com branding was further developed and then in December 2004 Mr Fields withdrew the licence to use the Klaus Kobec name - although Mr Cohen responded that he needed no such licence.

Judgement

The judgement (external link) was made by Mr Sheldon QC, sitting as a deputy high court judge.

Mr Fields said that his KLAUS KOBEC mark was infringed by:

• Its use on watches not sourced through him.
• Its use after he withdrew the licence
• The threatened use of the mark after the licence was withdrawn; and
• the use in new companies set up later.

The judge turned to whether the use made was "identical", which is relevant to the scope of protection. He referred to Reed v Reed, and said that the use in the company name was not a trade mark use and could be ignored.

In relation to the domain names, he thought differently, noting that Reed was a common surname but that Klaus Kobec was not. He therefore found that "klauskobec.com" was an identical use of the mark. He thought that <klauskobecfootball.com> and <klauskobecrugby.com> were similar but not identical.

The use of <klauskobec.com> after the licence was withdrawn could be trade mark infringement, subject to the defences.

Own Name defence

Mr Cohen said that the "own name" defence applied to the company. Following Reed v Reed it was accepted that "own name" could apply to companies, provided that the use was honest. The judge felt (for various reasons) that it could apply, because the company had chosen the name for honest reasons, and was required by contracts to use it to show origin.

However, the continued use of <klauskobec.com> was not covered by this defence, because the use was not, the judge felt, "in accordance with honest practices in industrial or commercial matters".

Invalidity

The case also involved a challenge to the validity of the trade mark, but we will not cover that here.