Interflora, Inc & Anor v Marks & Spencer Plc & Anor

Where a dispute raises difficult and necessary questions of harmonised European trade mark law, and existing references may not resolve all the issues, the national court may refer questions to the Court of Justice before trial. The court should ensure that the factual and legal context is sufficiently defined, while avoiding unnecessary duplication or fragmented references. A stay pending existing references is not preferable where there is a real possibility that further guidance will be required. An interim injunction restraining the defendant’s continuing conduct is discretionary and may be refused where the claimant delayed in seeking relief and accepted the status quo.

Interflora brought trade mark infringement proceedings against Marks & Spencer concerning its purchase of INTERFLORA and related terms as Google AdWords keywords. The claims relied principally on Trade Marks Act 1994, the Trade Marks Directive and the Community Trade Mark Regulation, and also raised possible liability of Google under the E-Commerce Directive and the Enforcement Directive.

Marks & Spencer applied for a stay under section 49(3) of the Supreme Court Act 1981 and CPR r. 3.1(2)(f), pending six existing references to the ECJ. Interflora alternatively sought an undertaking restraining Marks & Spencer from bidding on the keywords during the stay. The central issues were whether to refer questions to the ECJ at that stage and whether interim relief was justified.

1. The court decided to refer questions to the Court of Justice for a preliminary ruling and to stay the proceedings for that purpose. The issues concerning whether the conduct constituted use of a sign and whether the use was in relation to identical goods and services were difficult questions of European law. Guidance from the Court of Justice was necessary.

2. The existence of six pending references did not justify simply staying the proceedings pending their outcome. There was a real possibility that those references would not resolve all the issues arising in this case, including the claim against an advertiser under the reputation provisions, the wider range of acts alleged, the factual circumstances concerning possible confusion and genericisation, and Google’s United Kingdom and Ireland policy. References might also be withdrawn following settlement.

3. The national court was responsible for applying Community law to the facts, while the Court of Justice was responsible for interpreting the relevant Community legislation, as explained in Arsenal Football Club plc v Reed [2003] EWCA Civ 696; [2003] RPC 39. The factual situation was sufficiently clear to enable the legal questions to be posed, despite the absence of full trial findings.

4. The court declined to require Marks & Spencer to cease bidding on the keywords during the stay. The request was in substance an application for an interim injunction. Interflora had complained in May 2008 but commenced proceedings only in December 2008, did not seek interim relief or a speedy trial, and raised the proposed restraint only in response to the stay application. Having accepted the continuing position pending trial, Interflora had delayed too long to obtain interim relief.

5. The court also observed that the question whether a reference should be made before trial involved a balance between delay, expense, the risk of wasted costs and the possibility of narrowing or avoiding a trial. In the circumstances, making the reference immediately was the better course.