Threats are just so EASY to make

Last month the High Court handed down its lengthy judgment in W3 Limited v Easygroup Ltd [2018] EWHC 7 (Ch), which was generally in relation to W3’s infringement of Easygroup’s well known “EASY” trade marks by using the sign EASYROOMMATE.  W3 is the Claimant in this matter, due to it filing a claim for ‘unjustified threats’ against Easygroup before it could file a claim against W3 for trade mark infringement.

Mr Justice Arnold, the trial judge, is well-reputed for his well-considered and detailed judgments, of which this was no exception, coming in at a mammoth 425 paragraphs. Due to the complexity of the background and the plethora of issues at stake, the article focusses on only one point of interest, which is what happened in relation to the original ‘threats’ action (but spoiler alert, for those who are curious: the EASY trade mark was held partly invalid in relation to advertising and temporary accommodation, and not infringed by W3).

As discussed in some of our previous articles on this topic, the various pieces of ‘threats’ legislation provides a cause of action to the recipient of an IP infringement threat where it the threat is considered to be unjustified. Arnold J sets out the rationale for the threats provisions in para 412 of his judgment:

“[the provisions] strike a balance between the legitimate interests of the trade mark proprietor in warning infringers and the rights of others not to be vexed by threats which the proprietor is unwilling to translate into actual proceedings.”

The recipient of an unjustified threat can ask the court for: 1) a declaration that the threats are unjustified; 2) an injunction against continuing threats; and 3) damages in respect of any losses caused by the threats.

Easygroup had sent several letters to W3 between 2011 and 2014 – there was no dispute that each of the letters contained a threat. However, in at least one of the letters, undertakings were proposed that potentially went further than what Easygroup had covered under the trade marks (in this case, the request to cease using EASY “in any way”), and therefore were not justified making the demands. The question the court had to consider is whether these were actionable threats.

The court started its assessment by asking whether a reasonable person in the position of the recipient would have understood the intention of the person making the threat. In this case, the court held that a reasonable person would have understood that the demand extended further than what was covered under the mark, but they also would not have understood that that “immense breadth” of the undertaking meant that Easygroup were threatening to bring a trade mark claim of similar breadth.  The ‘extended’ threats, therefore, were not actionable.

Comment

Because written judgments containing threats actions are reasonably rare, it is useful to have some guidance from the court on what a reasonable person might consider to be an actionable threat.  Trade mark owners might find this judgment comforting in the sense that it is a typical tactic to draft undertakings which go a bit further, to ensure the activity is stopped and the chances of confusion are stopped or completely limited. If trade mark owners were exposed to threats actions on these wider elements, a ‘justified threat’ could suddenly become an ‘unjustified’ one with just a slight slip.

While the threats element of the judgment was held in the trade mark owner’s favour, it does go to show how threats actions are used in wider trade mark litigation and it is always worth seeking the advice of a legal professional before threatening someone with litigation to avoid stumbling accidentally into a threats action.