Nomination Di Antonio E Paolo Gensini SNC & Anor v Brealey & Anor (t/a JSC Jewellery)

A purchaser may disassemble trade-marked goods and resell genuine components, but exhaustion does not prevent the proprietor opposing further commercialisation where there are legitimate reasons under section 12(2) of the Trade Marks Act 1994 and article 7(2) of the Trade Mark Directive. Poor presentation may constitute such a reason where it is liable to damage the reputation of a luxury mark. A sign may also be used in relation to a reseller’s own goods where consumers understand the sign as identifying those goods as originating from the trade-mark proprietor. Such use may amount both to infringement and passing off.

Nomination owned trade marks for jewellery and marketed composable bracelets made from detachable links. JSC bought genuine Nomination bracelets and individual base links, separated or repackaged them, and sold Nomination links bundled with its own Daisy Charm links.

Nomination alleged trade-mark infringement and passing off. The issues included exhaustion and consent, legitimate reasons for opposing further commercialisation, whether the Nomination sign was used in relation to JSC’s own links, and whether the marketing misrepresented JSC’s goods as Nomination goods.

1. Exhaustion and consent. The court found that Nomination’s retailers reasonably assumed that they could sell individual base links. The evidence did not establish an effective restriction on such sales. The court considered the CJEU authorities on consent and exhaustion, but found it unnecessary to decide the consent issue because the sales were in any event liable to be opposed under article 7(2) of the Trade Mark Directive.
2. Legitimate reason. JSC supplied Nomination links in blister packs or transparent plastic bags, unlike the elegant packaging used for Nomination bracelets. Customers buying from JSC might associate Nomination’s product only with that inferior presentation. The court held that this was likely to damage the reputation of the Trade Marks and constituted a legitimate reason to oppose further commercialisation.
3. The court declined to extend the pharmaceutical repackaging requirement that the repackager and manufacturer be identified to ordinary bracelet sales. It also found no sound reason to believe that JSC’s packaging would damage the physical condition of the links.
4. Use in relation to JSC’s own goods. JSC’s bundled advertising created a blurred message about the manufacturing source of the two links. A significant proportion of the relevant public believed that JSC’s charms were genuine Nomination charms. Applying the principle that use in relation to goods is use for the purpose of distinguishing their origin, the court held that JSC had used the Nomination sign in relation to its own links and infringed section 10(1) of the Trade Marks Act 1994.
5. The same confusion constituted a misrepresentation. The resulting annoyance to Nomination’s customers and damage to its reputation established damage for passing off. The claim therefore succeeded.