UK: Trade Mark Registry Ruling On Dilution And Confusion

Last Updated: 26 February 2007
Article by Isabel Davies and Tom Scourfield

The Trade Marks Registry has allowed an opposition by Direct Line Insurance Plc to an application by esure Insurance Limited to register a three-dimensional mark consisting of a computer mouse on wheels in respect of insurance and financial services in class 36, based upon an earlier two and three-dimensional images of a telephone on wheels, registered for identical services.

In a long and detailed judgment, the Hearing Officer undertook an extensive review of the principles involved in the assessment of confusion and similarity of marks under s.5(2) TMA 1994, and also of the requirements to prove dilution and unfair advantage under s.5(3). Key to the success of the opposition was the conceptual similarity of the two marks, comprising of "an unusual juxtaposition of a communication device with wheels".

For full analysis and commentary on this interesting decision, please see below:

To view the article in full, please see below:

Full Article

In 2004, esure Insurance Limited (esure) had applied for a UK registration for the mark, consisting of a three-dimensional image of a computer mouse with eyes and wheels, in respect of insurance and financial services in class 36.

Direct Line Insurance Plc (DL) opposed this application under ss.5(2)(b) and 5(3) TMA, on the basis of its earlier two and three-dimensional images of a telephone with wheels, also registered for insurance and financial services in class 36. DL's mark had been heavily used in advertising and promotion, and was integral to its brand presence in the market. Although DL's mark was not restricted by colour, in practice it had always been used in red and black.

Esure had made extensive use of its "mouse" mark, typically accompanied by the slogan "cut out the phone and go online", intended to be "dig" at DL. In due course, DL also began to incorporate a mouse on wheels in its promotion and advertising, which was later than esure's launch of its "mouse" advertising campaign.

Opposition Upheld

In upholding the opposition on both ss.5(2) and 5(3), the Hearing Officer made a number of interesting comments:

Survey evidence

DL had conducted an extensive survey with the intention of demonstrating an association between the earlier telephone mark and the later application by esure. However, the survey was found to be valueless and of no assistance, since DL's advertising of its own red computer mouse on wheels could well have prejudicially affected the survey results.

Similarity of Marks

The threshold level of similarity necessary for a tribunal to continue to consider the other aspects of ss5(2) and (3) is reached whenever there is any visual, aural or conceptual similarity between the two marks that is likely to be recognised as such by the average consumer. In this case, a sufficient degree of similarity was present as both marks had the "unusual juxtaposition" of wheels attached to electronic communication devices. Once such similarity is demonstrated, the tribunal must consider whether one or more of the effects specified in ss.5(2) and 5(3) is likely to occur.

A Likelihood of Confusion?

Normal and fair use of esure's mark would include all colours, despite the fact that esure had only ever used it in its own blue and orange livery. Importantly therefore, this would include use in a red get-up. The distinctive character of the earlier mark was principally the unusual juxtaposition of the telephone and wheels. The mark had also achieved a huge reputation through extensive use. Coupled with the identity of the services, such distinctive character reduced the degree of similarity required for a likelihood of confusion.

The dominant and distinctive feature of both marks amounted to electronics on wheels, and a mouse and a telephone were also representative of the two principal channels of direct insurance and financial services sales. The modest degree of visual similarity between the marks was enhanced by a greater degree of conceptual similarity, resulting in a greater impact on the average consumer for such similarity than the various visual and aural differences.

Overall, the use of electronic communication devices in red with wheels was strongly associated with DL, so normal and fair use of esure’s mark would lead to indirect confusion between the two marks.

Dilution and Unfair Advantage: s5(3)

Evidential requirement: The Registry's current position is a mere possibility of damage occurring to the mark and its proprietor is insufficient, and the correct test is whether on the balance of probabilities the use of the later mark would have one or more of the effects specified in Section 5(3). Nothing less than this will do.

"Fettering" as a head of damage: The Hearing Officer rejected a suggestion that fettering the ability of the earlier mark to further exploit the commercial value is not an independent head of damage, since this would amount to giving the proprietor of an established mark the right to object simply because someone else has applied a mark that they would have liked to use or have registered.

Distinctiveness of earlier mark: Of significant relevance was the fact that Direct Line's earlier mark was highly distinctive, and very well-known in the relevant sector at the date of the application for the later mark.

Link between the two marks: The respective services were identical, so it was more likely that a recognisable similarity between the marks would cause an average consumer to make a link between them. It is interesting to note that the assessment of similarity for the purposes of Section 5(2) in terms of visual, oral and conceptual similarities was equally applied to Section 5(3). However, even if there was no likelihood of association in the sense of that required under 5(2), the concurrent use of the marks at the relevant date would have resulted in a link being made between them by the relevant consumer.

More than just a link required: The Hearing Officer suggests that it is now "well-established" that a non-confusing link between the two marks is not necessarily sufficient to engage Section 5(3), and that the link must give rise to one or more of the consequences specified in the Section (damage or unfair advantage).

Unfair advantage: The Hearing Officer notes that the stronger the reputation and distinctive character of the earlier mark, the easier it should be to accept that the later mark takes unfair advantage of it. At the date of the later mark's application, the former had a very strong reputation with relevance to the appropriate section of the public, as well as being extremely distinctive. In those circumstances, "bringing to mind" the earlier mark would have provided the later with a commercial advantage, in that a mark which calls to mind and attaches itself to the public's recollection of a famous mark used by another insurer was liable to commercially benefit from the fame of that mark.

Detriment to distinctive character: The Hearing Officer emphasised that it is necessary to have more than a theoretical prospect of dilution. Again, an important factor in this assessment is the uniqueness and exclusiveness of the earlier mark in the relevant market . The Hearing Officer found that the co-existence of the marks would be bound to reduce the uniqueness of the earlier mark and with it the immediate certainty with which the public would associate it with its proprietor. This amounted to sufficient detriment for these purposes.

Evidence of dilution: It is generally not possible to provide hard evidence of damage by dilution until after it has already occurred. However, the Hearing Officer cited the judgement of Patten J in the High Court in Intel Corporation v CPM as sufficient authority to draw inferences from evidence of primary fact and evidence of the strength of the existing mark and the similarity between them.

Evidence of detriment: Finally, an argument of detriment to repute by tarnishing was rejected since Direct Line had simply argued that the link alone would undermine the ability of the proprietor to control its own reputation with the public. This was rejected as no more than speculation. Since there had been no evidence to suggest that Esure's reputation was inferior or negative, the presence of the later mark alone would not necessarily impact on the proprietor of the former mark.

No due cause: Esure had argued that they had due cause to incorporate features of their competitor’s marks for the purposes of making a comparison under the Comparative Advertising Directive ("CDA"). However, the Hearing Officer considered that the incorporation of distinctive features of a competitor’s mark into a mark used to promote competing goods and services would not be covered by the CDA, and such use was clearly without due cause.


The decision itself is lengthy and the resources expended by both parties reflect the importance of the brand to each of the parties involved. Although this is only a first instance decision it involved a three-day hearing, three QCs, one junior Counsel, numerous witnesses, two surveys and a 44-page decision from the Hearing Officer. This makes an interesting contrast to the comments of the Court of Appeal in Special Effects on the limited resources typically expended in opposition proceedings.

It is also notable how the concept of normal and fair use of the mark as registered was construed to include the red livery so heavily advertised by DL as part of its various campaigns. In those circumstances, it became significantly harder to avoid a finding of confusion and unfair advantage. However, in the marketplace, where a (potentially) distinguishing orange and blue get-up was used by esure, the likelihood of confusion would be much lower. As we noted on our comments in the decision in the recent Community designs case between The Procter & Gamble Company and Reckitt Benckiser (UK) Ltd (see our Law-Now Click Here ), a monochrome registration will give the widest protection.

Finally, the case is notable for yet another instance when an expensive (and extensive) survey was found to be of no value to the tribunal. On this occasion, such failure was attributable to the party’s own similar advertising campaign which had potentially "muddied" the results.

For the full text of the decision in Trade mark application no. 2372783 by esure Insurance Ltd and Opposition by Direct Line Insurance Plc click here.

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to

Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.

The original publication date for this article was 22/02/2007.

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