Survival of Goodwill in Trade Marks and Passing off - Prysmian Cables & Systems Ltd v Apple International and others

Callender Cableworks Bank


Jane Lambert

Intellectual Property Enterprise Court (Recorder Amanda Michaels) Prysmian Cables & Systems Ltd v Apple International and others [2023] EWHC 2176 (IPEC) (7 Sept 2023)

The reason why there is a photo of a brass band is that the band consisted of members of staff at the Erith Works of the Callender Cable & Construction Co. Ltd. That was one of the companies to which Recorder Michaels referred in para [2] of her judgment in Prysmian Cables & Systems Ltd v Apple International and others [2023] EWHC 2176 (IPEC) (7 Sept 2023). The company merged with British Insulated Cables to form British Insulated Callender Cables Ltd or BICC which was one of the biggest names in British engineering.  BICC's cable business was acquired by Pirelli Cavi e Sistemi and later transferred to the claimant.    

Callender Cableworks Band

BICC's band, known as Callender's Cableworks Band, was one of the most famous in the country. It was established in 1898 and continued until 1961.  The photo shows the band in one of the studios of the BBC. It was often on the radio in the early years of broadcasting.   It won many competitions, performed at the Queen's Hall and made several recordings including Colonel Bogey and Les Huguenots.  Although she did not refer to the band in her judgment and it is not clear from the transcript whether the band was even mentioned at trial it is one of the reasons why members of the public (including yours truly) continue to think of BICC.

The BICC Brand

The action before the recorder was about the survival of the goodwill in the BICC name.  That is because the cable business was rebranded to BICON at the turn of the millennium.  An application was made to register BICON as a trade mark for various goods relating to cables in classes 6, 8, 9 and 20 on 30 Oct 2020 and the registration is now held by the claimant.  Neither Pirelli nor the claimant has ever traded as BICC and the only time that either of them has ever used that sign was when Pirelli sold some old BICC stock.

The Dispute

In 2015 the first defendant which is an Indian partnership began to sell cable components in the Middle East under the following sign:

This was very similar to the sign used by the old  BICC company:

The first defendant partnership had no connection with BICC other than supplying components to it in the 1990s. 

The first defendant started to use that BICC Components sign in the UK in 2017.

The son of the second defendant who was one of the partners of the first defendant acquired the third defendant which had been incorporated by a former employee of BICC.  The third defendant opened a  website at which made the following claim in respect of the old BICC business:

"The advancements in products and technologies are driven by an ever-evolving human nature to strive for excellence and to constantly improve on what is already available. This is the concept that was driving BICC group over the last fifty years as one of the prestigious business house based out of UK. We at BICC Components have inherited this very Legacy to re-introduce our complete range of cable accessories …"

The claimant's trade mark attorneys objected to the website and asked the third defendant to change it. Their request was ignored.  

On 11 Jan 2019, the second defendant applied to register the BICC Components sign that had been used by the first defendant as a trade mark.  The claimant's trade mark attorneys complained about this application to the second defendant in similar terms to their previous letter.  That letter was also ignored.  The mark was registered under trade mark number 003366406.

At some point before June 2020, the fourth defendant was appointed exclusive distributor of the first defendant's products.  Its marketing materials contained the following statement:

 "The BICC brand originated in 1945 … BICC is synonymous with quality cables and components and, whilst the cabling side of the business no longer exists, BICC components continues to produce some of the highest quality components in the marketplace."

The claimant's trade mark attorneys complained about this statement to the fourth defendant.  They alleged that the claimant owned the goodwill in the BICC sign but did not explain how it had acquired it,  Once again the trade mark attorneys' letter was ignored though the fourth defendant later referred the attorneys to the first defendant,

The Action

On 8 July 2022, the claimant issued proceedings for passing off, infringement of the BICON mark and invalidation of the second defendant's BICC Components mark,  The defendants alleged that any goodwill that had subsisted in the BICC sign had been abandoned and could not have passed to the claimant.  The action came on for trial before Recorder Michaels on 13 and 14 June 2023. By her judgment which she handed down on 7 Sept 2023, she dismissed all three causes of action.

Passing off

Following the House of Lords' decision in Reckitt and Colman Products Ltd v Borden Inc and others [1990] 1 WLR 491, [1990] 1 All ER 873, [1990] RPC 341, [1990] WLR 491, [1990] UKHL 12, the parties agreed that the elements of an action for passing off are goodwill, misrepresentation and damage, The defendants admitted that goodwill accrued to the BICC sign in relation to cables and their components up to 1999 and that the claimant enjoyed goodwill in relation to BICON.  However, they challenged the transfer of the right to use the BICC name or any accruing goodwill to the claimant. They contended that even if the claimant had acquired such name and goodwill it would have been lost through many years of non-use.

The claimant's case was that the General Cable Corporation acquired the BICC's cable business from BICC Plc in April 1999, and continued to use the BICC sign in the UK. In or around August 2000, Pirelli acquired shares in  BICC's UK cable companies from the General Cable Corporation. The goodwill in BICC passed first to Pirelli and finally to the claimant.  The recorder examined the contemporaneous documents relating to each of those transactions but found no evidence of a transfer of the right to use the BICC name or its goodwill. A letter between the in-house legal advisor to BICC General to his opposite number at Pirelli seemed to indicate that the right to use the name had not been transferred.  The registration of BICON as a trade mark suggested that Pirelli was aware that it could not use the BICC name and that registering a sign that contained the first 3 letters of the BICC mark was the next best thing.  She concluded that the right to use the BICC name had passed neither to Pirelli nor the claimant.

As for the argument that the right to use the name and its accruing goodwill had been abandoned, the recorder referred to Mr Justice Wilberforce's dicta in Norman Kark v Odhams Press [1962] 1 WLR 380 at 386, He said: "whether at any particular time a name has retained its goodwill to any substantial extent must be a question of fact to be determined on the evidence." On the facts before him, he found that "'Today' was a defunct periodical, no doubt of good memory. What had happened to it was not transmigration but extinction." 

On the other hand, a claim for passing off succeeded in Thermawear v Vedonis [1982] RPC 44, 66-67 because the plaintiff retained sufficient residual reputation notwithstanding the plaintiff's change of branding and even though the plaintiff had not used the name THERMAWEAR for 5 years and the defendant's use of a similar name during that time.

Ms Michaels referred to para [80] of Mr Justice Arnold's judgment in Maslyukov v Diageo Distilling Ltd and another  [2010] Bus LR D135, [2010] RPC 21, [2010] ETMR 37, [2010] EWHC 443 (Ch):

"… the test is whether the relevant business has been abandoned so as to destroy the goodwill. Mere cessation of business is not enough. Moreover, as [the Supremes case] illustrates, cessation of production of goods or provision of services does not necessarily mean that there has been a cessation of business capable of sustaining goodwill, still a less a destruction of the existing goodwill."

In the case before Mr Justice Arnold, the appellant had sought to register the names of certain Scotch whisky distilleries. as trade marks. The distilleries were no longer functioning, but stocks from each of them were held by independent bottlers or retailers and sold under or by reference to the distillery name. The judge held that the bottlers and retailers were licensees of the owner of the goodwill. Their use of the distillery's name would continue to generate goodwill for the distiller. 

In W.S. Foster & Son Ltd v Brooks Brothers UK Ltd [2013] EWPCC 18 (21 March 2013), Mr Recorder Purvis said at [68]:

"The doctrine of abandonment of goodwill is intimately tied up with the basic principle that goodwill has no free-standing existence. It is simply a property right attached to a particular business. If the business dies, then so does the goodwill."

In the case before him, the defendant had bought a shoe business in Northampton including its goodwill in 1964.  The vendor had sold ready-to-wear and bespoke footwear in which it had used a device called a "fox and boot."  The defendant continued to use its vendor's goodwill in the USA to sell ready-made shoes but declared in its marketing materials that it had abandoned its business in the UK. The claimant adopted a device similar to the fox and boot and traded in the same way as the vendor. When the defendant tried to revive its handmade shoe business  in the UK using the fox and boot device the claimant sued it for passing off.

In Recorder Michaels's view, if the claimant obtained ownership of the goodwill in the BICC name for the UK, it never intended to use it. It swiftly adopted the new BICON name and registered it as a trade mark. That was supported by the contemporaneous documentation to which the order had previously referred. She concluded that either Pirelli or the claimant deliberately abandoned the goodwill in 2000 or early 2001. No use was made of the goodwill before the defendants started to use the BICC Components mark in the Middle East in 2015 and in the UK in 2017. That was another ground upon which the passing off claim was bound to fail.

Finally, the recorder considered whether the goodwill associated with the BICC name was lost by attrition, and extinguished between 1999 or 2000 and 2017.  Mr. Purvis had addressed that point  at para [74] of his judgment in W.S. Foster & Son Ltd v Brooks Brothers UK Ltd. when responding to an argument that some customers might still remember the business that Brooks Brothers had acquired:

"Goodwill is not merely the memory of a business. It is 'the attractive force which brings in custom'. The acid test for its existence …must be whether, seeing a new pair of shoes bearing the … brand, such customers would place any reliance on the quality of the old product from the 1960s when considering whether to buy it. Plainly they would not…."

In this case, there had been 17 years of non-use of the BICC brand but more significantly the claimant had invested heavily in the rebrand educating its customers that the BICC's cable business would live on as BICON.  Ms Michaels acknowledged that BICC would have retained some reputation in the UK even in 2017. The defendants tried to tap into that reputation through their marketing. However, she reminded herself that reputation is not the same as goodwill. For goodwill, there must be customers. Since the claimant had never used the BICC mark and had actually rebranded it could hardly claim goodwill in the BICC sign.

While dismissing the claim for passing off the recorder added that the defendant's claims to a connection with the original cabling business would have been actionable if the claimant had any goodwill in the BICC sign.  Such representations went untrue in that they went well beyond the claim to be a supplier, The misrepresentations would also have been damaging.

Trade Mark Infringement

The claimant complained that the defendants had infringed its BICON mark under s.10  (2) and (3) of the Trade Marks Act 1994. 
Liability under s.10 (2)

It was common ground that the following conditions have to be met for liability under s.10 (2):
(i) there must be use of a sign by a third party within the relevant territory;
(ii) the use must be in the course of trade;
(iii) it must be without the consent of the proprietor;
(iv) it must be of a sign which is identical with or similar to the trade mark;
(v) it must be in relation to goods or services which are identical with or similar to those for which the trade mark is registered; and
(vi) it must give rise to a likelihood of confusion.

As to the assessment of a likelihood of confusion, Ms Michaels referred to Lord Justice Arnold's judgement from para [27] to para [28] of Match Group LLC and others v Muzmatch Limited and another [2023] EWCA Civ 454, [2023] FSR 18:

"[27]… In order to try to ensure consistency of decision making, a standard summary of the principles established by these authorities, expressed in terms referable to the registration context, has been adopted in this jurisdiction. The current version of this summary (see e.g. Sazerac Brands LLC v Liverpool Gin Distillery Ltd [2021] EWCA Civ 1207, [2021] ETMR 5 at [8]) is as follows:

'(a) the likelihood of confusion must be appreciated globally, taking account of all relevant factors;
(b) the matter must be judged through the eyes of the average consumer of the goods or services in question, who is deemed to be reasonably well informed and reasonably circumspect and observant, but who rarely has the chance to make direct comparisons between marks and must instead rely upon the imperfect picture of them he has kept in his mind, and whose attention varies according to the category of goods or services in question;
(c) the average consumer normally perceives a mark as a whole and does not proceed to analyse its various details;
(d) the visual, aural and conceptual similarities of the marks must normally be assessed by reference to the overall impressions created by the marks bearing in mind their distinctive and dominant components, but it is only when all other components of a complex mark are negligible that it is permissible to make the comparison solely on the basis of the dominant elements;
(e) nevertheless, the overall impression conveyed to the public by a composite trade mark may, in certain circumstances, be dominated by one or more of its components;
(f) and beyond the usual case, where the overall impression created by a mark depends heavily on the dominant features of the mark, it is quite possible that in a particular case an element corresponding to an earlier trade mark may retain an independent distinctive role in a composite mark, without necessarily constituting a dominant element of that mark;
(g) a lesser degree of similarity between the goods or services may be offset by a greater degree of similarity between the marks, and vice versa;
(h) there is a greater likelihood of confusion where the earlier mark has a highly distinctive character, either per se or because of the use that has been made of it;
(i) mere association, in the strict sense that the later mark brings the earlier mark to mind, is not sufficient;
(j) the reputation of a mark does not give grounds for presuming a likelihood of confusion simply because of a likelihood of association in the strict sense; and
(k) if the association between the marks creates a risk that the public might believe that the respective goods or services come from the same or economically-linked undertakings, there is a likelihood of confusion.'
[28] The same principles are applicable when considering infringement, although it is necessary for this purpose to consider the actual use of the sign complained of in the context in which the sign has been used: see Specsavers International Healthcare Ltd v Asda Stores Ltd [2012] EWCA Civ 24, [2012] FSR 19 at [45], [87] (Kitchin LJ, as he then was).
[29] It is well established that there are two main kinds of confusion which trade mark law aims to protect a trade mark proprietor against. The first, often described as 'direct confusion', is where consumers mistake the sign complained of for the trade mark. The second, often described as 'indirect confusion', is where the consumers do not mistake the sign for the trade mark, but believe that goods or services denoted by the sign come from the same undertaking as goods or services denoted by the trade mark or from an undertaking which is economically linked to the undertaking responsible for goods or services denoted by the trade mark. I discussed the distinction between the two in Sazerac v Liverpool Gin at [10]-[14]."

Applying those principles the recorder found an extremely low level of overall similarity between the claimant's BICON mark and the defendants' BICC Components sign. To the extent that there was any similarity between the mark and sign, she held that the differences between them were far more significant. Consequently, she was not persuaded that there was sufficient similarity overall to pass the 'threshold' test of similarity between mark and sign.

In case she was wrong on the threshold test, she noted that the defendants accepted that the goods for which the sign was used were identical or very similar to those for which the mark had been registered.  She directed herself that a high degree of similarity in the goods might counterbalance a low level of similarity in appearance between the mark and sign.  She considered the context in which the sign and mark might be used and the average consumer.  Taking all factors into consideration she concluded that there was no likelihood of direct or indirect confusion.   She therefore dismissed the claim under s.10 (2).

Liability under s.10 (3)

For the probanda of a successful claim under s.10 (3), Ms Michaels referred to paras [55] and [56] Mof Lord Justice  Arnold's judgment in Muzmatch:

"[55] A proprietor of a registered trade mark alleging infringement under Article 9 (2) (c) of the EUTM Regulation, Article 10 (2) (c) of Directive 2015/2436 and section 10(3) of the 1994 Act must show that the following requirements are satisfied: (i) the registered trade mark must have a reputation in the relevant territory; (ii) there must be use of a sign by a third party in the relevant territory; (iii) the use must be in the course of trade; (iv) it must be without the consent of the proprietor; (v) it must be of a sign which is identical with or similar to the trade mark; (vi) it must be in relation to goods or services; (vii) it must give rise to a link between the sign and the trade mark in the mind of the average consumer; (viii) it must give rise to one of three types of injury, that is to say, (a) detriment to the distinctive character of the trade mark, (b) detriment to the repute of the trade mark, or (c) unfair advantage being taken of the distinctive character or repute of the trade mark; and (ix) it must be without due cause.
[56] It is sufficient for the use of the sign to give rise to a link in the mind of the average consumer that the sign would call the registered trade mark to mind even if the average consumer would not be likely to be confused as a result: see Case C-252/07 Intel Corporation Inc v CPM United Kingdom Ltd [2008] ECR I-8823 at [60]. This must, like the question whether there is a likelihood of confusion, be appreciated globally taking into account all factors relevant to the circumstances of the case: see Intel at [41]."

Although the claimant had produced little beyond its sales figures and some trade literature, the learned recorder held that the scale of its use of the BICON mark had been substantial and that it had been continuously used since 2000. That seemed to be a case in which the court could properly infer that the BICON mark had the reputation necessary to sustain a claim under s. 10 (3).  However, in view of her finding as to dissimilarity or a very low level of similarity between sign and mark she considered that no link would be made between them. Seeing the defendants' sign would bring the BICON mark to the mind of any average consumer.

After considering Case C-487/07, L'Oréal SA v Bellure NV, [2010] Bus LR 303, [2009] EUECJ C-487/07, [2010] RPC 1, [2009] ETMR 55, [2009] ECR I-5185, [2009] EUECJ C-487/7 and  Whirlpool Corporation v Kenwood Ltd [2010] ETMR 7, [2010] RPC 2, [2009] EWCA Civ 753 she addressed the issues of unfair advantage and detriment.  She found no evidence of either.

Invalidation of the Second Defendant's Trade Mark

The claimant had challenged the validity of the second defendant's registration under s.5 (2), (3) and (4) In view of Ms Michaels's findings under s.10 (2) and (3) and the claim for passing off, those claims failed. It also challenged the registration under s.3 (6). It argued that the application had been made in bad faith because the second defendant had been aware that the claimant' had acquired BICC's cabling business. Accordingly, the second defendant had applied to register the BICC Components mark in bad faith with a view to disrupting the claimant's business.  

In support of its contention of bad faith, the claimant relied on:

i) The second defendant's evidence that he was at all times aware that the claimant had acquired the UK energy cables business, including the components business, from BICC Plc

(ii) the attempts by the defendants to convey the false impression that they were the inheritors of the historical BICC business.

The second defendant said that he knew and loved the BICC brand and regarded it as an unwanted child.  He wanted to restore it to its former glory.  He did not think there would be any confusion with the claimant because it had ceased to use the brand.  

The recorder dismissed the invalidation application because the claimant did not appear to have any goodwill in the BICC brand for all the reasons she had previously given.   If she was wrong, she was not persuaded that the second defendant had acted in bad faith.


This is a carefully reasoned and well-researched judgment and yet a somewhat unsatisfying one.  It is clear that the BICC heritage still has some value even after years of non-use and the rebrand and yet businesses that have no connection with the original company in Erith have a better title than the actual purchasers of its cable-making undertaking. 

There seem to be two reasons why the learned recorder arrived at this result. The first is that she drew a distinction between goodwill and reputation.  She held that the claimant had none of the former but accepted that it had some of the latter.  It is not always easy to distinguish between the two. If the ageing barrels and bottles of defunct distilleries constituted a reputation in Maslyukov why not the customer drawing power of the Erith company's heritage? The second reason is that she inferred that the rebrand was an admission by Pirelli or the claimant that it had no right to the BICC goodwill.

If either of those findings is wrong there would still be mileage in the passing off claim and the s.5 (4) objection to the registration of the BICC Components trade mark,  As for the trade mark infringement claim, no one would argue with Ms. Michael's conclusions that BICON and BICC COMPONENTS are very different signs that no amount of similarity of goods can counterbalance or that there is no link.

Anyone wishing to discuss this case can call me on 020 7404 5252 during office hours or send me a message through my contact page.


Peter Groves said…
This story takes me back to the mid-1980s, when Britain had a substantial manufacturing sector (before the Big Bang moved the goalposts), I worked at the CBI, and BICC was a large and influential member - their legal adviser was a member of the commercial law committee, of which I was secretary, and their HQ was just down the road from Centrepoint in what I believe had been (and has since reverted to being) an hotel. Thank you for the trip down memory lane (AKA New Oxford St)! I am surprised to read in your comment on this case that BICC somehow sold the cables business but not the name or the goodwill: what did they intend to do with those retained assets? Why did the purchasers agree to it? Surely it made their acquisition a great deal less valuable. None of which, of course, goes to the points in the case, which is worth noting as a good introduction to the issues it addresses.
Jane Lambert said…
That's what the recorder found and that is why I am slightly surprised about her judgment. Her inference that the company that bought the cable business did not acquire the goodwill seems to have been based on the rebranding exercise and the letter between the in-house legal advisors.

It will be interesting to see whether there is an appeal

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