Student Union Lettings Limited v Essex Student Lets Limited

For trade mark identity, insignificant differences such as spacing may be disregarded where they would go unnoticed by the average consumer. Likelihood of confusion is assessed globally, through the eyes of the average consumer, and actual confusion is not required.

In determining the geographical scope of goodwill, the court must examine how the particular business trades and the extent to which persons from outside its principal locality use or seek out its services. A business serving students at particular universities may possess national goodwill where its customers and marketing reach extend beyond the locality.

A local earlier right under section 11(3) of the Trade Marks Act 1994 cannot defeat infringement where the registered proprietor’s goodwill extends to the locality in which the earlier right is asserted.

The claimant provided student accommodation letting services in Leicester and owned the registered word mark SULETS. The defendant, a student accommodation provider connected with the University of Essex, rebranded its business as SU LETS and used that name in word and logo forms.

The claimant alleged infringement under sections 10(1) and 10(2) of the Trade Marks Act 1994 and passing off. The defendant relied principally on the defence for an earlier local right under section 11(3), asserting that it had acquired local goodwill before the claimant’s mark was filed and that the claimant’s goodwill was confined to Leicester.

The central issues were whether the signs were identical or similar, whether their use created a likelihood of confusion, the geographical scope of the parties’ goodwill, and whether the defendant could rely on section 11(3).

1. Trade mark identity. The court applied the strict identity test in LTJ Diffusion v Sadas Vertbaudet SA [2003] FSR 34. Identity may exist where differences are so insignificant that they go unnoticed by the average consumer. The space between SU and LETS was insignificant. SU LETS and SULETS were visually, aurally and conceptually identical for section 10(1).
2. Likelihood of confusion. The court applied the global assessment required by Specsavers International Healthcare Ltd v Asda Stores Ltd [2012] F.S.R. 19, as adjusted by Maier v ASOS plc [2015] EWCA Civ 220. The relevant consumers included students, parents, guarantors and landlords. The identical or highly similar sign was used for identical services, and the contextual references to the University of Essex did not prevent confusion. Actual confusion was unnecessary, although the evidence supported a reasonable inference that some consumers may have believed the businesses were connected.
3. Logo use. The words SU LETS were the dominant element of the defendant’s composite logos. The house device and straplines had little distinctiveness. Consumers would commonly refer to the logo by its verbal elements, and those words retained an independent distinctive role.
4. Section 11(3). The defendant had generated some goodwill in SU LETS by 27 March 2015, but the defence failed. Following the approach approved in Caspian Pizza Limited v Shah [2015] EWHC 3567 (IPEC) and [2017] EWCA Civ 1874, the claimant’s prior goodwill outside Leicester was relevant only if it extended to the locality in which the defendant asserted its earlier right. The claimant’s customers and marketing reached people throughout the United Kingdom. Its goodwill was therefore not limited to Leicester and defeated the defence.
5. Passing off. The defendant’s use constituted a misrepresentation. Direct diversion of sales was unnecessary: damage could arise through erosion of distinctiveness, potential harm from inadequate services, and restriction of expansion. The defendant’s own goodwill did not provide a defence, applying W.S. Foster & Son Limited v Brooks Brothers UK Limited [2013] EWPCC 18.
6. The claims for trade mark infringement and passing off succeeded. The court directed that counsel be heard on the terms of the order.

First instance decision. No appellate history was stated in the judgment.