Morley's (Fast Foods) Limited v Thurairasa Nanthankumar & Ors

In a trade mark infringement appeal, likelihood of confusion must be assessed by reference to the relevant average consumer as a single class, although attention may vary within that class. Intoxicated consumers should not be treated as a separate reference class. The sign must be assessed in its actual context of use, but context forms part of the global assessment and does not independently create confusion. A settlement licence permitting use of specified signs does not imply a power to sub-license them to later franchisees unless the agreement so provides or implication is necessary. Appellate intervention in factual findings and multifactorial evaluations remains limited.

Morley’s operated a chain of fried-chicken restaurants and owned registered trade marks including the Morley’s Red and White Mark and the Triple M Mark. The defendants operated competing Metro’s restaurants and used several signs on shopfronts, menus and products.

Following a judgment finding trade mark infringement and breach of a 2018 settlement agreement, the defendants appealed the consequential order. The appeal challenged the assessment of the average consumer, the visual and conceptual similarity of signs, the context of use, the effect and interpretation of the settlement agreement, and the finding concerning the sign MMM. The appeal did not challenge the finding that use of TRIPLE M/TRIPLE ‘M’ infringed by double identity. The central issues were whether the alleged errors were material, whether the agreement permitted the relevant uses or sub-licensing, and whether the finding of confusion concerning MMM was rationally sustainable.

1. Appeal dismissed. The Court of Appeal upheld the findings of infringement and breach of the 2018 Agreement.
2. For likelihood of confusion, the relevant consumer population was a single class comprising consumers patronising fast-food establishments. The court should not artificially divide that population based on time of purchase or supposed intoxication. Intoxicated consumers were not a proper reference point because the average consumer is reasonably well informed, observant and circumspect. The errors in the judge’s description were immaterial because the relevant levels of attention overlapped, and the same conclusion would have been reached on the correct basis.
3. The visual and conceptual assessments concerning Sign 1 and the Morley’s Red and White Mark were multifactorial evaluations. The judge was entitled to take account of the overall impression, including the similar stylised letter M, font, layout, strapline and white-on-red presentation, while recognising that the brand names differed. The findings were rationally supportable.
4. The context of use of Sign 1 was relevant because the sign was used on shops with a similar get-up and was more liable to cause confusion when displayed on a lit fascia at night. The judge used that context as part of the global assessment. She did not treat context as independently creating confusion.
5. The 2018 Agreement permitted KK to use the defined Metro’s Signs, subject to the restriction that modifications could not increase the likelihood of confusion with the claimant’s mark. At least the addition of the strapline had that effect, so Sign 1 was outside the permission.
6. The agreement did not permit KK to sub-license use of the Metro’s Signs to franchisees who were not already using the relevant Signs when the agreement was made. Trade mark law did not imply a general power to sub-license, and section 46(1) of the Trade Marks Act 1994 did not alter that contractual conclusion.
7. In context, “burger” described the product and “MMM” functioned as the sign. The judge was entitled to find medium-high similarity between Sign 2 and the Triple M Mark and a likelihood of confusion. The appeal was therefore dismissed.

• Court of Appeal (Civil Division): [2025] EWCA Civ 186 dismissed the defendants’ appeal.
• High Court, Intellectual Property Enterprise Court: HHJ Melissa Clarke found infringement and breach of the 2018 Agreement in [2024] EWHC 1369 (IPEC), followed by a consequential order dated 17 July 2024.