The Court of Appeal (CoA) has overturned a High Court decision which found an Irish jeans manufacturer had, since 1979, “dishonestly and wrongfully” copied the “Diesel” trademark of the popular Italian clothing brand.
In February last year, the High Court’s Mr Justice Brian Cregan said Monaghan-based Montex Holdings had unlawfully been using the “Diesel” mark.
He found Italian-based Diesel SpA was entitled to register its trademark in Ireland and made an order restraining the Irish firm from using the brand. Such a move would remove all risk of confusion and/or deception in the marketplace, he said.
He said Diesel had been selling clothing throughout many EU countries since 1978 and in Ireland since 1982 under its Diesel brand. Montex began making jeans in Ireland with the name “Diesel” on them in late 1979/early 1980.
RM Block
Montex applied in 1992 to trademark the word in its favour in Ireland while Diesel sought to secure registration of its brand in 1994. Each opposed the other’s bid to register the mark here.
The Controller of Patents, Designs and Trademarks in 1998 upheld Diesel’s objection to Montex’s application. The controller found Montex had failed to establish that there was no likelihood of deception and confusion with Diesel SpA’s offerings, thus failing to meet the requirements of the 1963 Trademarks Act.
The Supreme Court has since upheld a 2001 High Court decision refusing Montex’s registration.
In 2012, the controller upheld Montex’s opposition to Diesel SpA’s trademark request.
That led to a further High Court challenge by Diesel SpA appealing the controller’s decision and last year Mr Justice Cregan found the copying of a trademark was an act of dishonesty.
“Dishonesty is never a legitimate business practice,” he said.
Montex then appealed to the Court of Appeal.
On Tuesday, Ms Justice Niamh Hyland, on behalf of the three-judge court, overturned Mr Justice Cregan’s decision and allowed the Montex appeal.
She said the question as to the proprietorship of the mark was decided by the High Court in 2001. The court found in that case that blameworthiness does not have to be established for registration to be refused if there is a proven likelihood of confusion and refused registration.
Ms Justice Hyland said as the Supreme Court had already upheld that High Court decision meant the matter had already been decided. This is known as the legal principle of “res judicata”.
It should not have been revisited by Mr Justice Cregan, she said. She declined to consider the question of any alleged copying or wrongful conduct by Montex.
This was given that the Supreme Court in the Montex decision in 2001 unequivocally concluded that confusion under the Act prevents registration, irrespective of whether there is blameworthy conduct or not.
Accordingly, it was not open to Mr Justice Cregan to permit registration of Diesel’s mark on the basis of Montex’s conduct, given his acceptance that confusion would result from registration.
She confirmed the decision of the controller to refuse registration of Diesel SpA’s applications, with any necessary modifications to that decision to be determined after hearing from the parties.
