Just a month after Nike’s Nothing Beats a Londoner campaign won plaudits and awards for the creatives behind it, Nike lost the battle of the brands in the IP Enterprise Court after using ‘LDNR’ as an abbreviation of Londoner in its otherwise successful promotion.
The Intellectual Property Enterprise Court (IPEC) uses streamlined procedures to facilitate a quick result in commercial disputes. In the recent case of Frank Industries PTY Ltd v Nike Retail BV  EWHC 1893 (Ch) an interim injunction and speedy trial paved the way for judgment on the issue of trade mark infringement within just seven months.
Frank Industries PTY Ltd (Frank) is the proprietor of a UK and an EU mark for LNDR in relation to clothing and, in particular, sportswear. In January 2018, Nike launched a new London-focused campaign which used the sign “LDNR” in various ways, including a popular YouTube video.
Frank issued proceedings for trade mark infringement and was granted an interim injunction; Nike denied infringement, and issued a counterclaim to invalidate Frank’s trade marks.
The court had to consider how would the average consumer view the signs LNDR and LDNR, in context. The average consumer here was defined as a member of the general public, who purchases ladies’ sportswear and who exercises a moderate degree of care and attention.
The judge noted that “abbreviations can be used and understood because the context makes the intended meaning clear".
Nike argued that LNDR is inherently descriptive as it is an abbreviation meaning Londoner. Frank disagreed arguing that the average customer would not interpret LNDR as 'Londoner', and even if it were perceived as such, the term does not indicate a particular characteristic of clothing (and would not have been understood to do so).
Whilst Nike quite rightly established that LNDR could be understood to mean ’Londoner’ in the right context, it failed to establish that the average consumer would perceive LNDR as meaning Londoner when used in respect of clothing UNLESS there was some additional context to suggest that meaning.
Accordingly, the judge concluded that LNDR has a "moderately strong distinctive character" in relation to clothing and that LNDR and LDNR are confusingly similar.
The key issue for infringement was whether there was use of LDNR in relation to clothing.
Nike argued that:
- the average consumer would perceive LDNR as meaning Londoner and not as an indication of the origin of the goods; and
- the origin of the advertised goods was obvious due to the famous Nike tick.
Based on the evidence placed before the court, the judge concluded that some would see LDNR as 'Londoner' and others would see it as a brand name, and that enough people fell into the latter category to establish infringement.
This conclusion was reinforced by the evidence of actual confusion from two witnesses who thought that Nike had entered into a collaboration with Frank after seeing the advert.
Nike's main defence was that its trade marks are so well known that the average consumer would see them and only think of Nike. This may well be the case, but it does not exclude some form of collaboration between Frank and Nike (as highlighted by the witness evidence above).
Nike was found to have infringed the LNDR marks.
The IP Enterprise Court is commonly used for lower value and simpler IP disputes. It is well known for its damages cap of £500,000 and overall costs cap of £50,000 for the liability stage.
IPEC rules aim to simplify court procedures; applications are decided on the papers, the court places a cap on the number of witnesses and disclosure is limited. The rules also require a case not to exceed more than two days.
Although larger disputes still tend to go through the High Court, there is a Shorter Trials Scheme which is partly modelled on the IPEC procedure which aims to provide shorter and earlier trials.
If you have an IP infringement claim and are interested to learn more about IPEC or the Shorter Trials Scheme, please contact Sarah Cook.