Boehringer Ingelheim Kg & Anor v Swingward Ltd

Under the Trade Marks Directive 89/104, the necessity condition for parallel-import repackaging concerns only whether repackaging is needed for market access. It does not require justification of the particular manner or style of the new packaging.

Once repackaging is necessary, the decisive question under article 7(2) is whether the presentation is liable to damage the mark’s reputation. That question is fact-sensitive. Co-branding and partial de-branding are not irrebuttably damaging, although presentation can damage reputation beyond defective, poor-quality or untidy packaging. Total de-branding involves no use of the mark and therefore falls outside article 5.

Pharmaceutical manufacturers brought trade mark claims against parallel importers who reboxed, overstickered, co-branded or partly de-branded genuine products. Laddie J’s initial judgment of 28 February 2000, [2000] IP & T 502, referred questions to the ECJ. Following the ECJ’s response, Laddie J gave a further judgment on 6 February 2003, [2003] EWHC 110 (Ch), principally for the trade mark owners.

On an earlier appeal, this court determined some issues and referred further questions. Its judgment, [2004] EWCA Civ 129, was followed by a further ECJ judgment in Case C-348/04. The resumed appeals concerned the effect of that judgment on the necessity condition and whether the importers’ presentation of the products damaged the trade marks’ reputations.

Lord Justice Jacob gave the judgment, with which Lord Justice Tuckey and the Master of the Rolls agreed. The court held that the defendants had complied with the fourth BMS condition: their reboxing and relabelling had not caused, and would not cause, damage to the reputation of the trade marks. The court would allow the appeals, but deferred the final consequence pending written submissions because a further ECJ reference concerning minimum intervention remained pending.

1. Applicable framework. Article 5 of the Trade Marks Directive 89/104 defines the proprietor’s prima facie rights. Article 7(1) exhausts those rights after authorised marketing in the Community, subject to article 7(2). The importer must establish all five BMS conditions, including necessity, preservation of the product, clear identification, non-damaging presentation and notice.
2. Necessity. The ECJ’s ruling in ECJ 2 showed that necessity concerns only the fact of repackaging. It does not extend to the manner or style of the new packaging. There is no additional requirement of minimum intervention. The court considered that such a requirement would add a sixth BMS condition and could be practically unworkable.
3. Damage to reputation. Damage is a question of fact. The fourth condition is not confined to defective, poor-quality or untidy packaging. Nevertheless, co-branding, de-branding, obscuring the proprietor’s mark, omitting an ownership statement or using capital letters are not irrebuttably damaging. Their effect depends on the circumstances and the evidence.
4. Application. Co-branding which clearly presents the importer as importer, without disparaging the proprietor’s mark or suggesting a commercial association, causes no damage merely because it promotes the importer’s own identity. Total de-branding involves no use of the proprietor’s mark and therefore cannot infringe article 5. Partial de-branding is not inherently damaging merely because it reduces exposure of the mark. The specific de-branding and co-branding proved in these proceedings did not damage the marks, and Laddie J’s factual findings in Laddie 1 stood.
5. Burden of proof. Although the importer bears the burden of establishing compliance, this case was beyond the stage of initial onus. Both sides had adduced full evidence. The importers were entitled to rely on the apparently harmless nature of their activities and to require the proprietors to prove actual damage.

1. Court of Appeal (Civil Division) — In the resumed appeals, the court held that the importers satisfied the fourth BMS condition and deferred the final consequence pending submissions: [2008] EWCA Civ 83.
2. European Court of Justice — On the earlier appeal, questions were referred and answered in Case C-348/04.
3. Court of Appeal (Civil Division) — The court determined some issues, including passing off and necessity, and referred further questions: [2004] EWCA Civ 129.
4. High Court, Chancery Division (Patents Court) — Laddie J gave judgment principally for the trade mark owners on 6 February 2003: [2003] EWHC 110 (Ch). His earlier judgment of 28 February 2000 referred questions to the ECJ: [2000] IP & T 502.