Nude Brands Ltd.v Stella MccArtney Ltd & Ors

On an application for an interim injunction in a trade mark dispute, the claimant must show a seriously arguable case before the court assesses the balance of convenience. At this stage, validity and infringement issues ordinarily remain for trial where the evidence is genuinely contestable. In assessing the balance of convenience, the court must compare the likely irreparable harm from granting or refusing relief over the period before an ordinary trial. Commercial disruption, the practical consequences of stopping a major product launch, the apparent likelihood of actual confusion, existing third-party use and the claimant’s own licensing conduct may be relevant. An injunction should be refused where the likely harm to the defendant substantially outweighs the claimant’s interim harm and damages are an adequate later remedy.

Nude Brands Limited sought an interim injunction restraining Stella McCartney Limited, YSL Beaute Limited and L’Oreal (U.K.) Limited from marketing perfume and scented linen spray under the sign STELLANUDE. The application alleged infringement of Community Trade Mark No 5 781 745 for NUDE, registered for goods including cosmetics and perfumery.

The defendants intended to challenge the mark’s validity on descriptiveness, lack of distinctive character and customary use grounds under the Community Trade Mark Regulation. The central issues were whether there was an arguable case on validity and infringement, and whether the balance of convenience justified interim relief or an expedited trial before the planned launch.

1. Triable issue. The court first had to ask whether the evidence disclosed an arguable claim of infringement and an arguable defence. The challenge to validity under Article 7 of the Community Trade Mark Regulation was plainly arguable at trial, but the evidence did not establish at the interim stage that NUDE was descriptive, non-distinctive or customary in the trade for perfumes. Article 52(3) meant that any invalidity could be confined to particular goods.
2. The sign STELLANUDE was not identical to NUDE because the addition of STELLA would be noticed by the average consumer. Applying the approach in S.A. Societe LTJ Diffusion v Sadas Vertbaudet SA [2003] FSR 34, however, it was plainly arguable that the sign was similar. The goods included identical goods covered by the registration.
3. The claimant also had a plainly arguable case of confusion under Article 9(1)(b). The average consumer might separate STELLANUDE into STELLA and NUDE, and the respective elements could perform different functions. The defence remained arguable because the claimant had limited use of NUDE and none for perfume. The full issue depended on evidence at trial.
4. Balance of convenience and expedition. The risk of irreparable interim harm to the claimant was fairly small. Actual confusion appeared unlikely, the claimant did not presently enjoy exclusivity in NUDE perfume, its own perfume plans were remote, and its Dior licence weakened the case based on exclusivity or dilution. An expedited trial was therefore refused.
5. The proposed launch had been prepared on a substantial scale. An injunction would probably cause the loss of the Christmas selling period and potentially the brand itself, with very substantial commercial and reputational consequences. Those consequences outweighed the claimant’s likely interim harm. The application for an interim injunction and the application for an expedited trial were dismissed.