Recent Rectification Decisions

By Charlotte Duly. First published in the September 2009 issue of the ITMA Review.

There have been two recent rectification decisions at the UK Trade Mark Registry. These have reinforced the purpose of Section 64 of the UK Trade Marks Act 1994. Both of these decisions involved third parties joining the rectification proceedings, either by way of opposition or intervention, and provide further guidelines on when it is appropriate for this parties to become involved at the Registry.

Section 64 of the TMA provides as follows:

1. Any person having a sufficient interest may apply for the rectification of an error or omission in the register provided that an application for rectification may not be mae in respect of a matter affecting the validity of the registration of a trade mark.

2. An application for rectification may be made either to the registrar or to the court, except that:
a) if proceedings concerning the trade mark in question are pending in the court, the application must be made to the court; and
b) if in any other case the application is made to the registrar, he may at any stage of the proceedings refer the application to teh court.

3. Except where the registrar or the court directs otherwise, the effect of rectification of the register is that the error or omission in question shall be deemed never to have been made.

4. The registrar may, on request made in the prescribed manner by the proprietor of a registered trade mark, or a licensee, enter any change in his name or address as recorded in the register.

5. The registrar may remove from the register matter appearing to him to have cease to have effect.

Decision 1: VIPER
Decision of Appointed Person Ruth Annand, O-130-09, 13 May 2009.

In the matter of an application to rectify trade mark registration No. 1501909 in the name of Robert Dennis Busbridge and Martin Alan Busbridge trading in partnership as Cobretti Engineering and in the matter of opposition thereto by Kenneth Cook and in the matter of an appeal to the appointed person by the opponent against a decision of Mr. M. Foley dated 12 November 2008.

The Proprietor of UK registration number 1501909 VIPER in Class 12 was officially recorded as "Robert Dennis Busbridge and Martin Alan Busbridge trading in partnership as Cobretti Engineering". The trade mark was applied for on 18 May 1992 and registered on 12 November 2004. Robert Dennis Busbridge (RDB) applied to rectify the Register so that he was shown as the sole proprietor trading as Cobretti Engineering. In his Statement of Grounds, RDB advised that his brother Martin Alan Busbridge (MAB) had left the business and taken no active part in the partnership since June 1992. As evidence of this, RDB was in possession of a letter dated 29 June 1992 that the brothers had countersigned which stated that the partnership was terminated. MAB had since left the country and could not be contacted. RDB also had two letters from Taylor Willcocks dated 28 January 1993 and 17 February 1993 which confirmed that the partnership had been dissolved. At the time MAB left the partnership, copyright lititgation was commenced against Cobretti Engineering by Mr Kenneth Cook. MAB wanted no part in this hence RDB carried on with the business alone. This litigation ended with a consent order in 1999 without MAB's assistance.

The application for rectification
RDB applied to correct the Register on the basis that his brother was no longer part of the partnership and therefore he was to be the sole owner of the trade mark registration.

The Registry decided that the application was not one to correct an error or omission on the Register but rather one to remove matter that ceased to have effect (ie, MAB's name) under Section 64(5) TMA in accordance with Rule 45 of the Trade Marks Rules 2000. The evidence filed with the rectification application, including a witness statement detailing the departure of MAB and the letters above, were deemed sufficient by the Registry for the matter to be removed from the Register. The rectification was published and open to an opposition period of three months. Rather oddly, the Registry decided to send Mr Cook details of the application to rectify in order to provide him "with an update as to the current situation in these proceedings". Mr Cook was not a party to these rectification proceedings but due to previous involvement between Mr Cook and RDB it appears that the Registry thought it would be appropriate to notify in this instance.

Mr Cook filed an opposition to the rectification request. RDA was successful and the Registry allowed MAB's name to be removed. Mr Cook then appealed and filed an application to introduce further evidence.

The appeal
Applying the DU PONT criteria ([2004] FSR 15), most of Mr Cook's evidence was deemed irrelevant in the rectification proceedings as it related to the insolvency of RDB which had no bearing on the ownership of the trade mark or the removal of MAB's name from the Register. The request to introduce further evidence was therefore  rejected on the basis that itwould have no effect on the result of the case. During the proceedings it became clear that a number of Mr Cook's issues were in fact with The Insolvency Service and these were not relevant to the rectification proceedings. Mr Cook argued that the hearing officer erred in his decision to remove MAB's name from the Register because there was insufficient evidence that he had given up his interest in the business and the VIPER trade mark. However, it was determined that the documents filed by RDB confirmed that MAB intended to terminate the partnership and that RDB had carried on the business on his own since his departure. Therefore, the Appointed Person agreed that it was within the Registrar's discretion to remove MAB's name from the Register as matter appearing to have ceased to have effect.

Decision 2: TURBOCHIP
Decision of Appointed Person - Anna Carboni, O-112-09, 22 April 2009.

In the matter of trade mark registration No. 2389890 in the name of Commercial Power Solutions Limited and in the matter of an application by TUrbochip (UK) Limited to intervene in an application for rectification thereof (no. 82640) made by Specialist Autosport Services Limited. Appeal to an appointed person from the decision of Ms Judi Pike dated 16 June 2008.

This case involved an application to intervene in what became a rather complicated application for rectification. UK trade mark registration No 2389890 TURBOCHIP (& device) was applied for in the name of Commercial Power Solutions Limited (CPS) on 20 April 2005 and registration was achieved on 9 June 2006. On 25 September 2006 a company called Specialist Autosport Services Limited (SAS) filed an application to rectify the register under Section 64(1) of TMA to correct the name of the registered rpoprietor from CPA to SAS.

Disputed ownership
According to SAS's grounds for requesting rectification, at the time of filing the application CPS was the exclusive licensee of the TURBOCHIP brand in the United Kingdom. The license, which was not recorded in writing, was apparently issued from a Danish company called Turbochip A/S (TAS) and approved the UK application in the name of CPS. TAS terminated CPS's right to use the TURBOCHIP mark on 24 April 2006 and appointed SAS as their exclusive UK licensee on the same date. It was on this basis that SAS applied to rectify the register. SAS supported their application for rectification by supplying two witness statements, one made by Mr Nicholas Heyes who is a director of SAS (and at that point was also a director and shareholder of CPS) and from Mr Finn Borg who is the proprietor of TAS. At the time, CPS has another shareholder, Mr Christopher John, and it appears that he feel out with Mr Heyes in early 2006 during which time SAS was appointed as the UK licensee for the TURBOCHIP brand replacing CPS.

In response to the rectification request, Mr John filed a Notice of Defence and counterstatement on 8 December 2006. He advised that CPS had never been an exclusive licensee for TAS but instead he personally had purchased the use of the TURBOCHIP brand in October 2002 and granted CPS a license to use the mark. The licence was conditional that the rights in the mark would revert back to Mr John should he and Mr Heyes dissolve their business relationship. Mr John asserted that the application for rectification was one of a number of steps taken by My Heyes to unlawfully take the assets of CPS away from him.

Further documents wre filed by the parties regarding the relationship between Mr Heyes nd Mr John and their ownership of CPS. It is clear that matters between the two individuals had turned sour. In support of their rectification request, SAS filed various documents to evidence that from May 2006 CPS's application no longer had TAS's consent and therefore the presence of CPS as the registered proprietor was an error as the trade mark registered in this name could no longer guarantee the identity of the origin of the product in question.

The plot thickens
The UK Registry received a request to record an assignment of the registrationf rom CPS to Turbochip UK (TUK) as of 1 October 2007. The Registry advised CPS and TUK that no action could be taken in relation to the recordal because of the rectification proceedings. Following that notification, TUK filed a request to intervene in the rectification proceedings. The intervention was based ont he fact that one of the individuals behind TUK, Mr Thomas Gray, claimed to have conceived the TURBOCHIP brand in conjunction with Mr Borg of TAS. Mr Thomas Gray claimed to have traded using the TURBOCHIP logo both in the UK and Ireland since before 2000. Essentially, TUK's application to intervene was based on the fact that one of its founders had invented the mark and based on this had rights to the UK registration. It is on this basis that CPS decided to assign the mark to TUK despite the fact that the rectification proceedings were filed prior to the date of the assignment.

The Registry initially issued a preliminary view that TUK should be permitted to intervene. SAS requested a hearing to argue the case against intervention and the hearing officer subsequently refused leave to intervene and, at the request of TUK, provided detailed reasons.

The hearing officer determined that TUK did not have any role to play in the rectification proceedings. CPS was jointly owned by Mr Heyes and Mr John who each had a 50% control of the company and its assets. A 50% share meant that CPS could not assign, dispose of or alter any of the company's assets without the consent of both Mr John and Mr Heyes. As Mr heyes had not consented to the assignment to TUK it was not valid. As TUK could not validly take assignment of the registration it was to remain in the ownership of CPS as if no such assignment agreement had ever been made. It was determined that TUK could not even be the beneficial owner of hte registration as there was no valid agreement in place. As TUK is not hte assignee or the beneficial owner it does not have any stake in the proceedings and therefore was refused its application to intervene.

The appeal
TUK appealed this decision and shortly thereafter CPS was dissolved before the appeal hearing. Based on the Companies Act 1985, all assets of CPS were transferred to the Crown as bona vacantia. SAS contacted the Treasury Solicitor to confirm the position but the Crown responded that they were not interested in taking the registration over. This left the registration in the rather unusual postiion of hte owner no longer existing but the Crown refusing to assume ownership. It is likely that the position will change once the rectification proceedings have been decided in due course and that, depending on the outcome, the Crown will assert its rights in due course.

TUK appealed the hearing officer's decision on several grounds namely:

1. The hearing officer was wrong to consider evidence from the rectification application but should have considered the intervention application on its facts alone.

2. As Mr Heyes is a director of CPS and SAS he should not be able to act on behalf of both companies.

3. Mr Heyes is not actively promoting the TURBOCHIP brand in the UK as he trades under a different company name.

4. TUK should be regarded as the rightful owner of the mark.

TUK's arguments on all grounds were rejected. It was determined that the hearing officer was right to review the evidence in the rectification proceedings as it would be these proceedings in which TUK wished to intervene. It did not matter that Mr Heyes was a director of both CPS and SAS, as he did not claim to act on behalf of both companies in these proceedings. His position in relation to CPS was deadlocked with Mr John, which meant that neither of them could properly represent the company without thte other. Furthermore, by the time the appeal was heard this argument had fallen away, as CPS had dissolved. The use that Mr Heyes was making of the TURBOCHIP brand did not have any merit in relation to the rectification proceedings.

TUK's appeal related to an applciation to intervene in the revocation proceedings. According to Rule 35 (1) (now replaced by Rule 45 (1) of the Trade Marks Rule 2008 which is identical) an applicant who wishes to intervene must claim to have an interest in the proceedings. The ability to intervene is not an invitation to anyone who wishes to comment or file submissions in relation to the trade mark registration at issue but instead those who intervene must have a genuine interest in the actual proceedings at hand. It was determined that TUK had no such interest in the rectification proceedings that had been filed and therefore faile dto establish a proper basis for intervening. The rectification dispute in rlation to the fate of the registration is ongoing.

Summary
As well as providing further guidance on intervening, the TURBOCHIP case also highlights the fact that brand owners should avoid allowing licensees to file trade mark applications in their own name to ensure the correct owner retains the rights. The ability to record licences on the Register should also be taken advantage of. Both cases show that those looking to intervene in proceedings need to make sure they have a valid ground for doing so or they will incur unnecessary expense and are likely to have costs awarded against them.

Charlotte Duly, Boult Wade Tennant,  cduly@boult.com