The day TfL did not mind the gap
What happens when a famous transport slogan collides with a global fashion brand? TfL and Gap clash in a battle over iconic branding rights.
For Londoners and especially commuters, TfL is synonymous with the tube, its iconic colour grid and the eternal warning MIND THE GAP. But, for tourists all around the world coming to London, it is also synonymous with a variety of goodies emblazoned with the tube map or the distinctive red and blue London underground roundel.
It is in relation to this merchandise and warning that a dispute arose between TfL and Gap, the clothing company.
In September 2021, TfL filed a UK trade mark application for MIND THE GAP covering Classes 9 and 18, as its original EU trade mark application was still pending on the date the UK completed its exit from the EU. The application covered a variety of merchandise, including glasses, helmets, bags, umbrellas, wallets, etc.
The application was opposed by Gap (ITM) Inc. based on several of its earlier rights for GAP in Classes 18 and 25, claiming that there was a likelihood of confusion, unfair advantage and passing off. But GAP did not stop there. They also claimed that the application was filed in bad faith and relied on a confidential settlement agreement signed by the parties back in 2004.
Confusion: A warning or clothing brand?
This claim was rejected by the Hearing Officer as MIND THE GAP would be understood as a warning, which is not the case of the word GAP alone. The claim by Gap that the word GAP is dominant and distinctive in MIND THE GAP did not convince the Examiner, who added that the average consumer would not dissect the mark.
He added that this phrase has been associated with the London Underground since 1968. As the goods are, at most, similar to a low degree, he concluded that there was no likelihood of direct or indirect confusion.
Reputation: Bridging the gap between the goods
This ground was also dismissed. Gap only relied on its reputation in relation to the goods in Class 25, which the examiner considered are dissimilar to the applicant’s ones in Classes 9 and 18.
The Hearing Officer decided that there would be no link in the mind of the average consumer between the two marks.
Passing off? Not without misrepresentation
The Hearing Officer found that despite Gap’s goodwill, there would be no misrepresentation and rejected this ground.
Earlier rights: Why a settlement agreement didn’t qualify
Gap argued that the settlement agreement itself was an earlier right according to section 5(4)(b). This argument was dismissed by the Hearing Officer as it is not a right in itself. This section would apply to other rights like copyright or designs, for example.
An agreement cannot be considered as an earlier right.
Does breach of contract always result in termination?
Due to the confidential nature of the settlement agreement between the parties, part of the decision on this ground was redacted.
Gap argued that TfL’s application breached the binding agreement. On the other hand, TfL argued that this agreement was void as it was breached by Gap themselves.
According to the agreement, TfL was not allowed to register the mark MIND THE GAP for « clothing accessories ».
Two years before this dispute started, TfL discovered that Gap breached the settlement agreement by selling trousers bearing the distinctive blue and red London underground roundel together with MIND THE GAP.
TfL wrote to Gap requesting that they cease their use, which Gap did. At the time, Gap also assured that this would not happen again.
In this opposition, TfL argued that this breach of the settlement agreement resulted in it being terminated, which they claimed should result in this ground being dismissed.
However, according to the case law, some breaches of contracts do not warrant for it to be terminated.
To determine if a breach of contract warrants its termination, the case law Telford Homes (Creekside) Ltd v Ampurius Nu Homes Holdings Ltd provides a list of facts to consider which are as follows:
- the financial loss the breach has caused;
- the amount of the intended benefit under the contract that the injured party has already received;
- whether the injury can be adequately compensated in damages;
- whether the breach is likely to be repeated;
- whether the party in breach will resume compliance with their obligations;
- whether or not the breach has fundamentally changed the value of future performance.
When the breach occurred, the agreement had been in force for 15 years, the breach was minimal in terms of number of products sold and their value. Any injury could have easily been compensated for with damages. After this breach, both parties continued to abide by the terms of the agreement.
Finally, Gap also at the time explained to TfL the reasons why the termination was ineffective, which they ignored.
The Hearing Officer considered that as none of the elements listed by the case law were fulfilled, TfL could have not reasonably believed that the agreement was terminated.
TfL also argued that due to Brexit, the agreement was no longer covering the UK and therefore, should not apply to this case. The Hearing Officer once again refused this argument as it is against the spirit of the agreement.
For all these reasons, the Hearing Officer decided that TfL acted in bad faith by filing the application at issue in relation to purses, wallets and cardholders only.
Key take aways: Agreements, language, and long-term thinking
Despite the fact that bad faith through not abiding by an agreement is rarely brought up in proceedings before the Registry, it is important to keep in mind any agreement signed in the past to avoid this very situation.
In short, before filing new applications, it is important to review past agreements.
Should any agreement signed before Brexit cover the EU, it is important to review them too to ensure if the UK is covered or not, and potentially renegotiate it with the other side if necessary.
We also cannot stress enough the importance of precise language in agreements. In my opinion, ‘clothing accessories’ is a vague term and would benefit from being defined to avoid any future dispute and misunderstanding between the parties.
Of course, contracts can be binding for several years, and it is important to future proof. This requires taking two actions. The first one is to think about your medium to long-term plans before signing any contracts, which might stop you from doing so. The second one is to regularly review your contracts to ensure that your trade mark strategy still aligns with your prior commitments.
Be sure to get in touch with a Chartered Trade Mark Attorney if you’re looking for IP advice.
Author
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Sonia Amrar
Chartered Trade Mark Attorney, Stobbs IP Limited