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Kingspan v Rockwool

Written by Inam Ali on 10 March 2011

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In this case, the High Court has granted declarations of fact on whether the comparative advertising has satisfied the Misleading and Comparative Advertising Directive (2006/114/EC) (the Directive).

Background

Kingspan manufacture insulation materials made of plastic foam. Rockwool manufacture non-combustible stone wool insulation materials. The case was based in the comparative advertising in Rockwool's advertisements which compared the relative performance of the parties' insulation materials in fire tests.

The advertisements were in the form of road shows featuring small-scale fire demonstrations to industry audiences and marketing DVDs showing footage of large-scale fire tests carried out independently under the ISO 9705 fire test standard by SP Technical Research Institute of Sweden. In the advertisements, Rockwool was trying to demonstrate the difference between combustible and non-combustible insulation products, as it understood there was a misconception in the market.

The claims

Kingspan claims there was malicious falsehood and trade mark infringement. It alleges that the road shows and DVDs falsely presented its products as dangerous. Kingspan also sought a number of declarations that the road shows and DVDs did not comply with the Directive (as implemented in the UK by the Business Protection Regulations 2008).

Defence

Rockwool denied the allegations, arguing that the SP Technical Research Institute's tests were objective and compared like for like which formed the basis of legitimate comparative advertisements. It argued that therefore the use of Kingspan's trade marks was permitted under the Directive and trade mark infringement had thus not occured.

Judgement

1. Malicious falsehood - the High Court rejected the claim for malicious falsehood, finding that Rockwool "acted throughout in good faith", as the DVDs were produced in close association with SP which was "a highly reputable institute", and it had provided the DVDs to Kingspan for its comments before distributing them.

2. Trade Mark Infringement - Kitchin J ruled that Rockwool infringed Kingspan's trade marks in an early version of its fire DVD (created in 2007 and at the 2007 road shows). However the fire DVD created in 2008 and made available on Rockwool's website did not infringe Kingspan's trade marks. Despite the European Court of Justice's comments in Intel v CPM, Kitchin J made clear that a "serious risk" of damage in the future is sufficient to establish infringement (taking unfair advantage of, or being detrimental to the distinctive character or repute of the trade mark) under Article 5(2) of the Trade Marks Directive, rather than actual damage. This was despite the fact that no evidence was put forward of any actual damage or complaints from customers of Kingspan.

3. Comparative Advertising - Kitchin J made the following points:

(a) "Comparisons of the properties of competitors' products are to be encouraged and it is not open to a party to object to such comparisons simply because they are unfavourable to its products".

(b) Comparative advertising should be assessed using the criteria set out in the EU Legislation.

(c) There are eight requirements for lawful comparative advertising and these are cumulative: L'Oreal (Article 4 of the MCA Directive). These requirements must be "interpreted in the sense most favourable to permitting advertisements... while ensuring... that comparative advertising is not used anti-competitively and unfairly or in a manner which affects the interests of consumers.

Rockwool was unable to rely on the MCA Directive to permit the comparative advertising as it was found to have infringed Kingspan's trade marks and therefore failed to fulfil all of the conditions of Article 4 for legitimate comparative advertising.

4. Declaratory Relief - The court granted declartory relief and by doing so, this indicates that the court's are eager to grant it , as it serves to resolve important issues between parties in a claim, which can aid a swift conclusion to a claim.

A further hearing is scheduled for 14 April, in which the court will determine the precise form of the declarations of fact made and other relief.

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