Boxing Brands Ltd v Sports Direct International Plc & Ors

Interim injunctive relief may be granted where there is a serious issue to be tried and the claimant faces loss that damages may not adequately compensate. The court must assess the balance of convenience and justice, including the relative difficulty of quantifying each party’s loss, the preservation of control over a disputed brand, and the risk knowingly assumed by a party that proceeded despite an unresolved dispute.

Where validity proceedings concerning a Community trade mark are pending before OHIM, Community Trade Mark Regulation art 104(1) creates a strong presumption in favour of a stay. Special grounds may nevertheless justify retaining the national proceedings, particularly where the issues substantially overlap, factual disputes require disclosure and cross-examination, an expedited trial can provide earlier certainty, and interim relief is already required.

The claimant sought interim injunctive relief restraining the defendants from marketing sportswear bearing the QUEENSBERRY brand. It also sought an expedited trial. The defendants applied for a stay of the Community trade mark infringement claim under art 104(1) of the Community Trade Mark Regulation, because validity proceedings were pending before OHIM.

The parties disputed their respective entitlement to use related QUEENSBERRY trade marks. The defendants had launched products without giving the claimant specific advance notice. The central questions were whether the American Cyanamid principles favoured interim relief and whether special grounds justified refusing a stay.

1. Interim injunction. There was a serious issue to be tried concerning the validity and use of the competing trade marks. The claimant had shown a sufficient risk of uncompensable loss, including lost profits from its own proposed launch and loss of control over the development, promotion and value of the brand. The defendants’ potential loss of profits was difficult to quantify but broadly equivalent. The claimant’s undertaking to remain out of the market pending trial meant that an injunction would preserve the market without exposing the defendants to the same risk of brand interference.
2. The defendants had proceeded onto the market knowing, or having reason to know, that the claimant was likely to object and seek relief. Their decision to assume that risk was a further factor supporting preservation of the status quo. The low-key nature of the launch reduced the likelihood of substantial brand tarnishment if sales were paused. The claimant’s cross-undertaking in damages, supported by Mr Warren’s personal undertaking and evidence of means, was adequate.
3. Expedition. The trial was ordered to be expedited to July 2013 because either side faced losses that might not be fully compensated in damages.
4. Stay. Although art 104(1) created a strong presumption for a stay, special grounds existed. The national and Community trade mark issues substantially overlapped; disputed good-faith questions were better suited to the English court’s disclosure and cross-examination procedures; an expedited national trial would provide materially earlier certainty than the OHIM process; and delay increased the risk of uncompensated loss. Article 104(3) permitted the interim injunction to continue during any stay. The stay application was refused.
5. The defendants were ordered to pay the claimant’s costs of the applications on the standard basis.