The Effect of an Arbitration Clause in a Trade Mark Coexistence Agreement on IP Litigation - Lifestyle Equities CV and another v Hornby Street and others
Intellectual Property Enterprise Court (HH Judge Hacon) Lifestyle Equities CV and another v Hornby Street (MCR) Ltd and others  EWHC 3320 (IPEC) (30 Nov 2020)
The first claimant has registered the following sign in the EU and UK as trade marks for clothes and various other goods. The second claimant is its exclusive licensee.
"Any controversy, dispute or claim with regard to, arising out of, or relating to this Agreement, including but not limited to its scope or meaning, breach, or the existence of a curable breach, shall be resolved by arbitration in Los Angeles, California, in accordance with the rules of the American Arbitration Association. Any judgment upon an arbitration award may be entered in any court having jurisdiction over the parties."
"The correct view may be that a person is party to an arbitration agreement within the meaning of the 1996 Act if, according to the law governing the agreement he is party to it, or, alternatively and more broadly, if he is bound by the arbitration agreement under that law. I will turn later to both those matters."
Before deciding the proper law of the contract, Judge Hacon referred to evidence that the claimants had been aware of the agreement and had actually relied on it. In the first instance, the in-house legal adviser to the first claimant's parent company had requested and received a copy of the agreement from the 8th defendant. In the second, the claimants relied on the agreement to register a trade mark in Mexico. They did not object to the following statement by the 8th defendant:
"Lifestyle Equities, C.V. (through its predecessor entity), and SBPC are parties to a worldwide coexistence agreement dated October 6, 1997, and pursuant to that agreement SBPC consents to this registration."
While the claimants may not have been party to the 1997 agreement they certainly appear to have adopted it in order to register their mark in Mexico.
"But in other cases (semble), the validity and effect of an assignment of an intangible may be governed by the law with which the right assigned has its most significant connection."
"(1) The material validity, scope and interpretation of an arbitration agreement are governed by its applicable law, namely:
(a) the law expressly or impliedly chosen by the parties; or,
(b) in the absence of such choice, the law which is most closely connected with the arbitration agreement, which will in general be the law of the seat of the arbitration.
(2) In general, arbitral proceedings are governed by the law of the seat of the arbitration.
(3) The substance of the dispute is governed by either:
(a) the law chosen by the parties; or
(b) if the parties so agree, such other considerations as are agreed by the parties or determined by the tribunal; or
(c) if there is no such choice or agreement, the law determined by the conflict of laws rules which the arbitral tribunal considers applicable."
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