Court allows Diesel SpA to register 'Diesel' trademark despite prior Montex application due to Montex's alleged copying and bad faith.

APPROVED

NO REDACTION NEEDED

COURT OF APPEAL

IN THE MATTER OF THE TRADE MARKS ACT 1963

AND IN THE MATTER OF THE TRADE MARKS ACT 1996

AND IN THE MATTER OF APPLICATIONS NUMBER 177240 and 177245

DATED 11 JANUARY 1994

PURSUANT TO THE TRADE MARKS ACT 1963

BY DIESEL SPA FOR REGISTRATION OF DIESEL AND DIESEL (DEVICE) AS

TRADE MARKS IN CLASS 25 OF THE REGISTER OF TRADE MARKS

Neutral Citation No: {2025] IECA 211

Court of Appeal Record No: 2024 180 & 2024 181

High Court Record No. 2013 641 SP

The President

Allen J. Hyland J.

BETWEEN/

DIESEL SPA

PLAINTIFF/ RESPONDENT

- AND -

THE CONTROLLER OF PATENTS, DESIGNS AND TRADEMARKS

FIRST DEFENDANT/ APPELLANT

AND

MONTEX HOLDINGS LIMITED

SECOND DEFENDANT/ APPELLANT

JUDGMENT of Ms. Justice Hyland delivered on the 28 day of October 2025 SUMMARY

1. This appeal concerns a long running dispute between an Irish company, Montex Holdings Limited (“Montex”) and an Italian company, Diesel SpA (“Diesel SpA”), both of whom applied to register the name “Diesel” as a trademark for jeans. Montex applied for registration in 1992, Diesel in 1994. In 2001, in the case of Montex Holdings Ltd v. Controller of Patents [2001] 3 I.R. 85, the Supreme Court upheld the refusal of the Controller of Patents, Designs & Trade Marks (the “Controller”) to register Montex’s application for registration, on the basis that doing so would cause confusion under s.

19 of the Trademarks Act 1963 (the “1963 Act”).

2. This appeal concerns a refusal by the Controller to register Diesel’s application for registration on the basis that Diesel was not the proprietor of the trademark, and that registration would result in confusion. Diesel appealed against that decision and Cregan

J. (the “trial judge”) in the High Court ([2023] IEHC 757) decided that Diesel was entitled to register its trademark as it was the originator, owner and proprietor of the mark. The trial judge accepted that confusion would result but held that this arose because Montex had copied Diesel SpA’s mark since 1979, and decided confusion could not prevent registration where it was caused by wrongful conduct.

3. Montex have appealed against this judgment. I allow Montex’s appeal on the following basis. First, I conclude that the question as to the proprietorship of the mark (although not the question of registration under s. 25(2) under the 1963 Act) was decided by the High Court in Montex’s favour by O’Sullivan J. in the case of Montex Holdings Ltd v. Controller of Patents [2000] 1 I.R. 577 and that finding was accepted by the Supreme Court. As such this question is res judicata and ought not to have been revisited by the trial judge. On the other hand, I cannot agree that the trial judge was wrong in admitting new evidence as to Montex's bona fides. The trial judge had discretion to admit such evidence, and its admissibility depended on whether the issue was res judicata. Since the trial judge had not yet ruled on that point when the evidence was introduced, its admission was not improper.

4. I have declined to consider the question of any alleged copying or wrongful conduct by Montex, and the effect of same on the application for registration by Diesel SpA as being unnecessary, 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 the trial judge to permit registration of Diesel’s mark on the basis of Montex’s conduct, given his acceptance that confusion would result from registration. The question of blameworthiness by Montex is irrelevant under s. 19 and therefore Diesel SpA's application must be refused due to the likelihood of confusion.

5. Accordingly, I confirm the Controller's decision to refuse registration of Diesel SpA's applications, with any necessary modifications to that decision to be determined after hearing from the parties.

FACTUAL BACKGROUND

6. These appeals, brought by the Controller and Montex, seek to set aside the order of Cregan J. (the “trial judge”) in the High Court ([2023] IEHC 757) annulling the opposition by Montex to Trade Mark Applications 177240 and 177245 made by Diesel SpA and directing that said applications proceed to registration.

7. Diesel SpA is a clothing company incorporated under the law of Italy. It manufactures and sells clothes – including jeans – under the brand name “Diesel” and began to sell its clothes under this name in Italy and other European countries in 1978. It first sold jeans in Ireland in 1982.

8. Montex is an Irish company with a registered office in Monaghan. Its predecessor manufactures jeans under the name “Diesel” and began producing them in late 1979.

9. Montex originally applied to the Controller to register the word “Diesel” as a trademark on 18 September 1992. The application was accepted by the Controller and advertised on 15 December 1993. Diesel SpA applied to register the trademarks “Diesel” and “Diesel (Device)” in Ireland on 11 January 1994. In the same year, Diesel SpA registered their opposition to Montex’s registration on the basis that it was likely to lead to confusion with its products and was an attempt by Montex to dishonestly take its trademark. Montex similarly opposed Diesel SpA’s attempt to register its proposed marks.

10. It having been received first in time, Montex’s application was considered by the Controller prior to Diesel SpA’s application. The Controller rejected the application on

22 April 1998 on the basis that 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 Act.

11. Montex appealed the Controller’s decision to the High Court and the matter was decided by O’Sullivan J. in Montex Holdings Ltd. He refused the registration of the Montex application on the grounds that Montex had failed to demonstrate its proposed use of the mark was bona fide. He also found that the mark was likely to cause confusion under s. 19 of the 1963 Act. The High Court’s ruling in respect of the confusion finding was upheld by the Supreme Court in Montex Holdings Ltd v. Controller of Patents, who declined to consider the issue of bona fides on the basis that it was unnecessary to decide same. (In this judgment, these proceedings will be referred to as the “first set of proceedings”).

12. Once Montex’s application had been determined, the Controller turned to Diesel SpA’s application for registration, which was opposed by Montex. The Controller reached a

decision on 4 April 2013 upholding the opposition in respect of applications 177240 and 177245, while allowing other applications to proceed to registration. Reasons for his decision were given on 9 September 2013: being first, that Diesel SpA was not the proprietor of the trademark; and second, that there would be confusion if Diesel SpA’s mark was allowed on the register – such confusion not having been caused by the unlawful purloining by Montex of Diesel SpA’s mark.

13. Diesel SpA appealed that decision to the High Court under s. 57 of the 1963 Act. The

decision on that appeal is the subject of the appeal to this Court. Under s. 57(5) of the 1963 Act, an appeal shall only lie to this court on a specified point of law. The trial judge gave leave on five questions (see Annex 1 to this judgment).

14. Before considering the judgment of the High Court, and the grounds of appeal, it may be helpful to set out the legislative regime governing the issues in this case. The 1963 Act, and the regime it established, has been entirely replaced by an EU regime, and is no longer the applicable law governing trademarks. Consequently, this judgment, although of great significance to the parties, is unlikely to be relevant to many other people.

LEGISLATIVE REGIME

15. Section 2 of the 1963 Act provides the following definitions:

“‘mark’ includes a device, brand, heading, label, ticket, name, signature, word, letter, numeral, or any combination thereof.” “‘trade mark’ means, except in relation to a certification trade mark, a mark used or proposed to be used in relation to goods for the purpose of indicating, or so as to indicate, a connection in the course of trade between the goods and some person having the right either as proprietor or as a registered user to use the mark, whether with or without any indication of the identity of that person, and means, in relation to a certification trade mark, a mark registered or deemed to have been registered under s. 45 of this Act.”

16. Section 19 of the Act provides: “It shall not be lawful to register as a trade mark or part of a trade mark any matter the use of which would, by reason of its being likely to deceive or cause confusion or otherwise, be disentitled to protection in a court of law, or would be contrary to law or morality, or any scandalous design.”

17. Section 20 of the Act relates to the prohibition of registration of similar trademarks, and the doctrine of honest concurrent use.

18. Section 57(1) of the 1963 Act provides a right of appeal to the High Court against any order or decision of the Controller. Section 25(7) sets out the nature of an appeal under s. 57:

(7) Appeals under s. 57 of this Act against decisions of the Controller under this s. shall be heard on the materials stated as aforesaid by the Controller, and no further grounds of objection to the acceptance of the application shall be allowed to be taken by the Controller, other than those so stated as aforesaid by him, except by leave of the Court.

19. Section 57(1) and (2) provide: “(1) An appeal shall lie to the Court from any order or decision of the Controller under any provision of this Act (not being a decision of the Controller under s. 11 or subs. (7) of s. 69 of this Act) or from a correction of an error in the register by the Controller under subs. (3) of s. 42 of this Act, and the Court may make such order confirming, annulling or varying the order or decision or correction of the Controller as it thinks fit.

(2) In any appeal from a decision of the Controller to the Court under this Act, the Court shall have and exercise the same discretionary powers as under this Act are conferred upon the Controller.”

20. Order 94, rule 48 of the Rules of the Superior Courts – the rule in force at the relevant time – provided that every appeal “shall be by way of rehearing.”

DECISION OF TRIAL JUDGE

21. A helpful overview of the trial judge’s conclusions is set out in relevant part at paragraph 283 of the judgment: “1. Diesel Italy is the originator, owner and proprietor of the mark ‘Diesel’;

2. Diesel Ireland has dishonestly and wrongfully copied Diesel Italy’s mark in Ireland since 1979;

3. There would be confusion and deception within the meaning of s. 19 of the 1963 Act if both marks were to continue to be used in Ireland; however that confusion and/or deception is caused by the dishonest, wrongful and unlawful copying of the mark by Diesel Ireland;

4. Diesel Ireland cannot rely on its dishonest, wrongful and/or unlawful acts of copying to argue that there will be confusion or deception in the market place when it is the cause of that deception by virtue of its dishonest, wrongful or unlawful acts; that would be to allow Diesel Ireland to profit from its own wrong;

5. This court will fashion an appropriate remedy by way of injunction to restrain the unlawful use by Diesel Ireland of the mark ‘Diesel’;

6. Such remedy will remove all risk of confusion and/or deception;

7. There are no reasons why I should exercise my discretion under s. 25(2) of the 1963 Act to refuse registration of the mark ‘Diesel’ to Diesel Italy;

8. Diesel Italy is entitled to register its mark ‘Diesel’ as a trademark in Ireland.”

22. The trial judge later clarified that no injunction had been granted against Montex restraining their use of the mark; rather, paragraphs 5 and 6 meant that the court would consider fashioning an appropriate remedy if an application was brought.

QUESTION 1: RES JUDICATA

23. The first question certified by the trial judge is as follows: 1(A). Whether the High Court is required to determine that Diesel SpA is not the proprietor of the mark “Diesel” within the meaning of s. 25(1) of the Trade Marks Act 1963 and/or that the registration by Diesel SpA must be refused under s. 19 of the 1963 Act, having regard to the decisions of this Court and the Supreme Court respectively in Montex Holdings Limited v. The Controller of Patents, Designs and Trade Marks and Diesel SpA [2000] 1 IR 577 and [2003] 3 IR 85? 1(B). Whether the Court erred in finding that the question as to whether Diesel Ireland had engaged or had not engaged in a bona fide use of the trade mark was not an issue which had already been decided conclusively by a court of competent jurisdiction and/or in finding that there was a lack of clarity about what O’Sullivan J. had decided with regard to that issue and whether the High Court was therefore required to reject as an abuse of process the adducing of further evidence on this issue in these proceedings.

24. Question 1(A) focuses upon the application of the doctrine of res judicata/issue estoppel having regard to the argument of Montex that these issues had been determined in the first set of proceedings and therefore could not be revisited. The trial judge set out the law on res judicata, referring to the decision of Kelly J. (as he then was) in McConnon v. President of Ireland [2012] IEHC 184 where it was held that for a party to rely on res judicata, the following factors must be present: “(a) a previous decision of a judicial tribunal of competent jurisdiction;

(b) that decision must have been a final and conclusive judgment;

(c) there must be an identity of parties; [and]

(d) there must be an identity of subject matter.”

25. The trial judge added to this list in his ruling at paragraph 93, suggesting a fifth criterion: “that the ‘res’ which has been adjudicated on should be clear and unambiguous”.

Res judicata: Proprietor of the mark

26. Although the question put to this Court was specifically about the s. 25(1) question i.e. proprietorship, the trial judge did not, in fact, separate out s.25(1) and s. 25(2) in his judgment. He considered the judgment of O’Sullivan J. in Montex and concluded at paragraph 106 that the question as to whether Montex engaged in a bona fide use of the mark “Diesel” was not res judicata and as a result was open to consideration. His reasoning was as follows. Although O’Sullivan J. had decided that Montex was not a bona fide user of the trademark, it was not clear whether his decision on the lack of bona fides related to the issue of proprietorship or to an exercise of his discretion under s. 25(2) of the 1963 Act. Moreover, the trial judge pointed out that the Supreme Court had declined to consider whether Montex had engaged in a bona fide user of the mark because it took the view that s. 19, being a mandatory issue, required to be decided first. Therefore, he said, it was impossible to know what conclusion the Supreme Court might have come to on the bona fide issue. In the circumstances the doctrine of res judicata did not apply as (a) the determination of O’Sullivan J. could not be regarded as a final and conclusive judgment; (b) there was no identity of subject matter, as the question in the within proceedings was whether Diesel SpA application should proceed to registration, whereas the question in the first set of proceedings was whether Montex should proceed to registration; and (c) there was a lack of clarity as to whether the

decision of O’Sullivan J. related to proprietorship or the exercise of his discretion under s. 25(2).

Arguments of the parties

27. In respect of the bona fides/proprietorship arguments, Montex argues that O’Sullivan

J. had decided that it had a right to ownership of the mark as proprietor, and that this was a separate and distinct finding from whether, as a matter of discretion, it should be permitted to register its mark under s. 25(2). It refers to the following passage in the judgment of O’Sullivan J.: “I accept … that the plaintiff has established a sufficient user prior to the date of application to entitle it prima facie to be registered as owner” (p. 586).

28. Accordingly, it argues that the High Court was not entitled to revisit that conclusion, and that the trial judge erred in concluding that this finding was not res judicata. Alternatively, it is argued that the matter became res judicata following the decision of the Supreme Court, since the Supreme Court, by deciding the appeal on the s. 19 question, had implicitly accepted the question of proprietorship and had expressly declined to decide on the discretionary aspect of same.

29. Similar arguments were made by the Controller, who argued that Montex’s proprietorship of the mark was conclusively determined in the first proceedings and was therefore res judicata.

30. On the other hand, Diesel SpA argues that O’Sullivan J. decided that Montex was not entitled to registration because it was not the proprietor and because it had not acted bona fide. It refers to his decision to refuse registration, as well as his conclusion in the following terms: “I am not satisfied on the evidence before me that the plaintiff’s proposed user of the mark is bona fide”.

31. It argues that O’Sullivan J. had concluded that the prima facie entitlement of Montex to be registered as owner as first user was displaced, as its use was not in good faith. It points out that nowhere in the judgment does O’Sullivan J. categorise his findings into s. 25(1) or s. 25(2) issues. Thus, if binding effect is to be given to the judgment as to proprietorship, it is – it is said – that Montex was not, in equity, the bona fide proprietor of the Diesel mark.

Analysis

32. The first part of Question 1A is narrow: it is exclusively concerned with proprietorship under s. 25(1). Sections 25(1) and (2) are in the following terms: “(1) Any person claiming to be the proprietor of a trade mark used or proposed to be used by him who is desirous of registering it must apply in writing to the Controller in the prescribed manner for registration either in Part A or in Part B of the register.

(2) Subject to this Act, the Controller may refuse the application, or may accept it absolutely or subject to such amendments, modifications, conditions or limitations, if any, as he may think right.”

33. In my view, O’Sullivan J. has determined that Montex, as first user in the State, was the proprietor within the meaning of s. 25(1), given the terms of paragraphs 4, 5 and 6 of the judgment, under the heading “Law and Conclusions” (preceded by the conclusion at paragraph 3 that Montex had acquired the interest first owned by Monaghan Textiles). Those paragraphs are in the following terms: “4. I further accept that the test of ownership in the mark is that ownership vests in the party first using it in this jurisdiction. In this I am following Morritt L.J. in Al Bassam Trade Mark [1995] RPC 511 at p.

522 where he said:-

‘Accordingly it is necessary to start with the common law

principles applicable to questions of the ownership of

unregistered marks. These are not in doubt and may be shortly

stated. First the owner of a mark which had been used in

conjunction with goods was he who first used it. Thus in

Nicholson & Sons Ltd.’s Application (1931) 48 RPC 227, at page

253 Lawrence L.J. said: “The cases to which I have referred (and there are others to the like effect) show that it was firmly established at the time when the Act of 1875 was passed that a trader acquired a right of property in a distinctive mark merely by using it upon or in connection with his goods irrespective of the length of such user and of the extent of his trade and that such right of property would be protected by an injunction restraining any other person from using the mark”.’

5. I further accept, as did the first defendant, that the plaintiff has established a sufficient user prior to the date of application to entitle it, prima facie, to be registered as owner and secondly, that the second defendant has also established a sufficient user therein, prior to that date, to entitle it to locus standi as opponent.

6. I turn now to deal with the second defendant’s claim that the application itself is wanting in bona fides.” (Emphasis added)

34. Ultimately, having considered the evidence in relation to an allegation that Montex was not the bona fide proprietor, O’Sullivan J. concluded that he was not satisfied on the evidence that the proposed user of the mark was bona fide, and, on that ground, would refuse permission for the proposed registration – which possibility is provided for under s. 25(2).

35. In my view, those passages make it quite clear that O’Sullivan J. has determined at this point in the judgment that Montex was the proprietor within s. 25(1). His subsequent conclusions on bona fides and the lack thereof, leading to a refusal of registration, are subsequently characterised as an exercise of the discretion conferred by s. 25(2) by the Supreme Court in the following terms: “… the learned High Court judge held that there was a lack of bona fides in the plaintiff’s proposed user of the mark and that on this ground he would refuse registration. Effectively this was a purported exercise of his discretion under s. 25(2) of the Act of 1963 cited above”.

36. Accordingly, I cannot agree with the trial judge that O’Sullivan J.’s decision was unclear on the question of proprietorship or ought not to be regarded as a final judgment in this respect. There was an identity of subject matter and of parties: in both the first set of proceedings and these proceedings, the same parties were asking the same question: which of them was the proprietor of the mark. This question was answered with finality by O’Sullivan J.

37. Turning to the decision of the Supreme Court, Geoghegan J. makes it clear that the s.

19 question i.e. confusion, being a mandatory issue, ought to have been determined ahead of any discretionary grounds for refusal under s. 25(2) and that O’Sullivan J. had dealt with the matter in the wrong order by refusing registration on a discretionary basis before addressing the question of confusion, quoting paragraph 4-09 of Kerly’s Law of Trade Marks (12th edn.), as follows: “The discretion of the registrar only arises if he decides preliminary questions of fact in favour of an applicant. There is no room for the exercise of the registrar’s discretion where the opponent succeeds in opposition under s.s 11 or 12(1) ...’

38. Geoghegan J. endorsed this approach on the basis that it was important that the Controller or judge on appeal should first address the question as to whether it is mandatory to refuse registration, before addressing the question as to whether as a matter of discretion it should be refused. He concluded that O’Sullivan J. was correct in his decision on s. 19 and in those circumstances, it was inappropriate to give any consideration to the discretionary issue.

39. Although there is no explicit engagement with the question of proprietorship of the mark, in my view the decision of the Supreme Court is premised on an acceptance of the High Court’s finding that Montex was the proprietor. (That finding does not appear to have been appealed, as the only two issues before the Supreme Court were s. 19 and s. 25(2) i.e. discretionary refusal to register on the grounds of a lack of bona fides). If the Supreme Court had not accepted that Montex was the proprietor, there would have been no reason to engage with s. 19. The Act contemplated applications by persons claiming to be the proprietor. The scheme of the Act is that the entitlement to be registered is premised on ownership. The premise of the possibility of confusion is the entry of the mark on the register. That cannot arise unless and until any contested issue of proprietorship has been decided.

40. Accordingly, returning to Question 1A, I conclude that given the explicit terms of the

decision of O’Sullivan J. in the High Court and the absence of any disagreement on this point by the Supreme Court, the doctrine of res judicata required the High Court to determine that Montex was the proprietor of the mark. Was the s. 19 question res judicata?

41. The trial judge did not explicitly address the s. 19 res judicata argument, save to say that the remarks of O’Sullivan J. on s. 19 were obiter, as the ratio decidendi of his

decision was that the proposed user was not bona fide.

42. Montex argued that the Supreme Court had determined that it was the likelihood of confusion simpliciter that engaged the s. 19 bar to registration and there was no requirement of wrongdoing for the s. 19 bar to apply. It further contended that the first proceedings had determined that the simultaneous use by the parties of the same mark on the same kind of goods of necessity gave rise to confusion, precluding registration under s. 19. Accordingly, it was submitted that the trial judge was bound by those determinations as a matter of issue estoppel even where cause of action estoppel did not apply, citing Simons J. in Right to Know CLG v. An Taoiseach [2024] IEHC 713.

43. Diesel SpA argued that on the present trademark application, the trial judge was concerned with whether the Diesel mark in Diesel SpA’s hands, as applied to its goods, would be likely to result in deception and confusion in circumstances where Montex was found to have adopted and used the mark in bad faith. It pointed out that no other court had ever been asked to decide that mixed question of law and fact and contended the trial judge was right in his conclusion that this question was not res judicata.

Analysis

44. It is common case that the existence of confusion must be adjudicated at the date of the application for registration. Montex applied for registration in 1992. Diesel SpA applied in 1994. Therefore, the question of whether confusion existed at the relevant time is different in the two sets of proceedings. The question in the first set of proceedings was whether there was confusion at the date of application by Montex for registration (1992). The question in these proceedings (if the proprietorship of the mark was not res judicata) would be whether there was confusion at the date of application by Diesel SpA for registration (1994). That means the finding of confusion by the High Court and the Supreme Court in the first proceedings could not have been treated as being conclusive in these proceedings.

45. The argument of Montex that the Supreme Court had determined that it was the likelihood of confusion simpliciter that engaged the s. 19 bar to registration, without a requirement of wrongdoing, is more difficult to dismiss out of hand. In Right to Know, Simons J. (paragraph 19) describes issue estoppel as follows: “Put otherwise, notwithstanding that the judgment in earlier proceedings may not have entailed a final determination on the legal right asserted in subsequent proceedings, it may nevertheless have determined an issue which is common to both sets of proceedings. Provided that the determination of this issue had been an essential part of the rationale for the earlier judgment, then the finding on the issue will, generally, be binding in the subsequent proceedings.”

46. On one view, the interpretation of s. 19 is an issue common to both sets of proceedings and its determination is an essential part of the rationale of the Supreme Court. In response, Diesel SpA contends that an argument that s. 19 must be interpreted differently when the person seeking registration is not alleged to have acted mala fide was not raised in the first proceedings and therefore that issue remains to be determined. I do not agree with the substance of that argument for the reasons I explain below.

However, given the long-standing nature of this litigation, I think it is important that Diesel are permitted to make that argument, and have it substantively determined.

47. For that reason, I have decided to treat the s. 19 question in the context of this case as being open to determination. I should emphasise that my finding that the trial judge was correct in not treating the s. 19 question as barred by the doctrine of issue estoppel is not a finding that this court can depart from the interpretation given to s. 19 by the Supreme Court, as discussed further below. That would be entirely contrary to the doctrine of binding precedent, the rationale for which was explained by the Supreme Court in Jordan v. Minister for Children and Youth Affairs [2015] 4 I.R. 232 as follows:

“64. However, the doctrine of precedent is itself part of the

administration of justice contemplated and required by the Constitution and provides qualities of certainty and predictability which are important and indeed vital parts of that system. These are qualities of enduring importance, perhaps more so where there is a multi-tiered superior courts system.” QUESTION 1(B)

48. Question 1(B) asks whether the trial judge was correct in his conclusion that the question as to whether Montex had engaged in a bona fide use of the trademark had not been conclusively decided in the first set of proceedings and whether he “was therefore required to reject as an abuse of process the adducing of further evidence on this issue in these proceedings”.

49. This appears to be a refinement of Question 1(A), which asks, fundamentally, whether the issue of proprietorship was res judicata.

50. Diesel SpA argues that Montex had multiple opportunities in the first set of proceedings to explain how it came to adopt the mark and did not do so; that the issue as to whether Montex bona fide adopted and used the mark for jeanswear was finally determined by O’Sullivan J.; and that the trial judge erred in permitting Montex to re-open the matter and adduce new evidence contrary to Henderson v. Henderson (1843) 3 Hare 100.

51. It might be assumed that, given my assessment of O’Sullivan J.’s decision on proprietorship as a final one, O’Sullivan J.’s decision on the bona fide use of the mark by Montex must also be treated as final. However, there is a difference in the treatment of the two issues by the Supreme Court in the first set of proceedings. In the case of bona fides, the Supreme Court explicitly ruled that it did not need to decide upon that issue because the decision on the existence of confusion meant Montex could not be registered and that ended the appeal. On the other hand, as explained above, in the context of its ruling on confusion, the Supreme Court must be taken to have implicitly accepted O’Sullivan J.’s ruling on proprietorship, as without doing so, there would have been no requirement for it to consider the confusion point. Thus, arguably, O’Sullivan J.’s decision on the proprietorship point was accepted by the Supreme Court, whereas the same is not the case for his ruling on bona fides. Happily, it is not necessary to determine this rather fine point since my decision on proprietorship being res judicata determines this appeal and therefore the question of Montex’s bona fides, including whether that matter was res judicata, does not require to be addressed.

52. However, at the hearing, Diesel SpA pressed the point that the trial judge’s decision to permit the introduction of new evidence going to the bona fides of Montex breached the principle in Henderson v. Henderson. The evidence led by Montex was directed to a factual issue raised by Diesel SpA as to the bona fides of Montex – or more correctly of Monaghan Textiles – in using the mark, which, Diesel SpA contended, went to the question of proprietorship.

53. Since this is a point that potentially has significance beyond the particular facts of this case, I will address it. The complaint is framed in rather emotive language: charging Montex with abusing process. As a matter of law, it is an abuse of process to attempt to re-litigate a question which has been finally and conclusively determined between the parties. It follows that evidence directed to undermining such a finding is inadmissible. However, the question as framed tends to suggest that by simply attempting to tender the evidence, Montex was guilty of abuse of process; and the trial judge was obliged to reject the attempt to tender the evidence as an abuse of process.

54. I cannot agree with this submission. Trial judges have a wide discretion as to how they run a trial, including in respect of the introduction of evidence. The trial judge was entitled to permit the evidence to be adduced, despite the argument of Diesel SpA that the question of bona fides was res judicata and could not be reopened. No decision had been given by the trial judge on the res judicata argument when the objection to the

introduction of the evidence was made, and there was no logical inconsistency in him allowing the evidence in those circumstances. The introduction of the evidence did not prevent him from fairly adjudicating upon the res judicata issue after the conclusion of the trial. The admissibility of the evidence directed to the question of proprietorship depended on whether proprietorship was res judicata.

55. For the reasons already given, I have concluded that the trial judge erred in finding that the question of proprietorship was not res judicata, but if it had not been, the evidence would have been admissible, and the judge would have been required to evaluate it. Unless and until the issue as to whether proprietorship was res judicata was determined, Montex was entitled to seek to tender the evidence, and the judge was correct to receive it on that basis. (In fact, as it transpired, the trial judge ultimately excluded much of the new evidence because of hearsay and treated the rest as “being of little or no weight, being given by a single witness, whose credibility is questionable, in respect of which there is not a single corroborative piece of documentation and is wrong on a crucial matter of fact” - paragraph 202).

56. In the circumstances, I answer Question 1(B) as follows: the High Court was not required to reject as an abuse of process the adducing of evidence on Montex’s bona fides in using the mark.

QUESTION 2

57. The second question certified by the trial judge is in the following terms: “Whether a first user of a mark abroad can claim to be proprietor of the mark in the State within the meaning of s. 25(1) of the Trade Marks Act 1963 in priority to the first user of the mark in the State, in circumstances where there is no pre-existing commercial arrangement or understanding between the first user abroad and the first user in the State, and there is no breach of any such arrangement or understanding, but where the first user in the State is found to have copied the mark from the first user abroad.”

58. Having regard to the answer to Question 1A above, the question of the proprietorship of the mark at issue in these proceedings has been conclusively determined by O’Sullivan J. in the first set of proceedings in favour of Montex, and therefore this matter is res judicata and may not be pursued further in these proceedings.

QUESTION 3: CONFUSION

59. The third question certified by the trial judge is as follows: “3. Whether, as regards the notion of confusion, that conduct of an opposition party, such as deceptive or dishonest conduct, was relevant and/or determinative in respect of the application of s. 19 of the 1963 Act.”

60. Because I conclude that conduct is irrelevant, and because it is accepted that confusion would be caused, this renders a consideration of Questions 4 and 5 unnecessary.

61. The trial judge accepted that the simultaneous use of the two identical marks at issue in these proceedings would be likely to deceive and/or cause confusion within the meaning of s. 19 of the 1963 Act, but concluded that because the cause of the deception/confusion was the dishonest, wrongful and unlawful copying of Diesel’s mark by Montex, he would not refuse registration under s. 19. He explained his reasoning as follows: “As a matter of first principles, a company like [Montex] cannot commit an act of deception and/or dishonesty by copying a mark and then argue that [Diesel SpA] should be refused registration because of the deception and/or confusion caused thereby. That would allow [Montex] to profit from its own wrongdoing”.

62. The question certified requires me to consider whether the trial judge was correct to adopt this approach, having regard to s. 19 as interpreted by the Supreme Court.

63. To address this issue, it is necessary to consider in detail the decision of the Supreme Court in Montex, and its treatment of the decision of the House of Lords in GE Trade Mark [1973] RPC 297. I have concluded that the question as to whether s. 19 operates to prevent Diesel SpA’s application for registration is not res judicata. But as noted above, that conclusion does not in any way undermine the importance of the interpretation the Supreme Court placed on s. 19. That interpretation is binding on this Court. In short, the Supreme Court held that s. 19 operated to prevent registration of the mark where it would be likely to deceive or cause confusion (hereafter referred to as “confusion” by way of shorthand). It explicitly rejected the argument advanced by Montex that confusion alone was insufficient to prevent registration, and that it was also necessary to show that the mark sought to be registered would be disentitled to protection in a court of law because of blameworthiness on the part of the applicant for registration – what I will refer to as the “confusion plus” argument.

64. That interpretation of the equivalent s. to s. 19, being s.11 of the English Trade Marks Act 1938 (the “1938 Act”), was accepted by the House of Lords in the case of GE Trade Mark some years previously by Lord Diplock, albeit in respect of an application for expungement rather than registration. Geoghegan J. engaged fully with that case, and with the decision of Berlei (UK) Limited v Bali Brasserie Co. Inc [1969] 2 All E.R. 812 that preceded it, as well as with some Australian cases that had grappled with the same issue. Having done so, he came down firmly on the “confusion simpliciter” side of the argument i.e. that confusion alone meant registration was prohibited. This presents a formidable hurdle for Diesel SpA in seeking to stand over the decision of the trial judge to permit registration, despite the existence of confusion.

Arguments of the parties

65. Both Montex and the Controller make the simple point that it is – altogether unsurprisingly – accepted by Diesel SpA that confusion will result if their mark is registered; and that the interpretation of s. 19 by the Supreme Court requires only confusion to make refusal of registration mandatory, definitively rejecting the argument that blameworthiness is relevant in any way. Accordingly, they argue that the appeal must succeed on that ground alone due to the trial judge’s failure to correctly apply s.

19. The Controller focuses upon s. 19 as being intended to protect the public. Montex endorses that and adds that, contrary to the submission of Diesel SpA, the identity of the opponent – and any alleged wrongdoing by it – cannot be relevant in interpreting s. 19.

66. Diesel SpA accepts that the Supreme Court in Montex determined that the reference to “disentitled to protection in a court of law” did not require it to be shown that the applicant’s conduct had also been blameworthy in some way, but argues that the Supreme Court in Montex did not conclude that considerations of blameworthiness in bringing about the confusion in the first place on the part of the opponent are irrelevant to s. 19. It argues that there is a fundamental difference between an applicant being denied registration due to confusion, even if the applicant is not to blame for that confusion, and an applicant being denied registration due to confusion brought about by the deliberate wrongful conduct on the part of the opponent: noting there was no allegation in the Montex proceedings that Diesel SpA had wrongly adopted Montex’s mark. It concludes that deceptive or dishonest conduct on the part of an opponent is relevant and may be determinative in respect of the application of s. 19, arguing that it cannot be correct in principle that a person who mala fide copies a mark for use on the same goods can rely on the confusion generated to oppose registration. It argues that this result would not protect the public, since it impedes the ability of the true proprietor to bring the confusion to an end through infringement proceedings.

67. At the appeal hearing, an additional and different argument was made by counsel for Diesel SpA to the effect that the judgment of Morritt L.J. in Al Bassam Trade Mark [1995] RPC 511 establishes that proprietorship is always or often an issue in deciding if a s.19 bar arises and that if the opponent is wrongfully causing the confusion, it has no right to the mark. He relied upon the following quotes from that case: “I do not see how one can determine whether there is likely to be confusion without first deciding who is the proprietor” (p. 522, line 46) “In my view proprietorship may raise different issues to that of deception within s. 11, though no doubt it is true that they will often overlap” (p. 523)

68. Counsel points out that in the Montex case, there was no allegation that Diesel SpA had improperly taken the mark and refers to the acceptance by Morritt L.J. that, if there is opposition to a claim of proprietorship, the Registrar (equivalent to the Controller) must determine the rights where the opponent is a rival claimant.

69. Counsel concludes by suggesting that it may be necessary to look at proprietorship in the context of s. 19, i.e. to decide whether the opponent has any right to be using the mark and that there was no principle laid down by the Supreme Court in Montex to the effect that one must ignore mala fides completely in the context of s. 19.

Analysis

70. In my view, what I will describe as the Al Bassam argument can be disposed of swiftly. First, I am not sure the passages relied upon support the case made: rather Morritt L.J. seems to be simply stating a court must determine proprietorship first before considering confusion, and that proprietorship and confusion are separate issues. But even if I am wrong in that assessment of Al Bassam, the legal context in which the judgment exists is quite different: as discussed below, in England, the case of GE Trade Mark means that blameworthiness is relevant when adjudicating on s. 11 of the English Act (the equivalent provision to s.19); an entirely different interpretation has been given to s. 19 by the Supreme Court in Montex. Moreover, the Supreme Court has said that s.

19 must be considered first, before any consideration of bona fides.

71. More substantial is Diesel SpA’s argument that the Supreme Court interpretation is narrower than contended for by Montex, and that it does not apply squarely to the current situation, where there are no allegations of wrongdoing against Diesel SpA and where Diesel SpA alleges that the confusion was caused by Montex’s wrongdoing. To address this argument, it is necessary to consider GE Trade Mark in some detail and then to analyse precisely what the Supreme Court held in Montex. Section 19 and the equivalent s. in England, s. 11 of the 1938 Act, are in substance identical. Section 19 provides as follows: “It shall not be lawful to register as a trademark or part of a trademark any matter the use of which would, by reason of its being likely to deceive or cause confusion or otherwise, be disentitled to protection in a court of law, or would be contrary to law or morality, or any scandalous design.”

72. Section 11 of the 1938 Act provides as follows: “It shall not be lawful to register as a trademark or part of a trademark any matter the use of which would, by reason of its being likely to deceive or cause confusion or otherwise, be disentitled to protection in a court of justice, or would be contrary to law or morality, or any scandalous design.”

73. The only difference in the respective sections is the reference to a court of justice in s. 11, while s. 19 refers to a court of law. Nothing turns on this difference.

74. Any reader of the judgments that interpret s. 19 or its English equivalent, s. 11 of the 1938 Act, must be left with one overarching impression: this is a difficult s. to understand and apply, and many hours of judicial time have been consumed in the attempt. As may be seen from the judgment of Lord Diplock in GE Trade Mark, s. 19 has a complicated legislative history, necessitating a consideration of the Registration of Trade Marks Act 1875, the Trade Marks Act 1905, the 1938 Act and the common law position in respect of trademarks prior to the 1875 Act. It raises complex questions of interpretation. It distinguishes between the treatment of the use of a mark which is likely to deceive or cause confusion on the one hand and marks the registration of which would be contrary to law or morality or any scandalous design on the other hand. It makes clear that a court has no discretion in the matter of registration if the criteria in the s. are met. But the test in relation to confusion is not what one would expect i.e. a court may not register as a trademark any matter the use of which would be likely to deceive or cause confusion. Rather, there is a different test: a matter the use of which would be disentitled to protection in a court of justice by reason of its being likely to deceive or cause confusion may not be registered. By contrast, the provisions of s. 19 in relation to trademarks contrary to law, morality, or any scandalous design are entirely straight forward: it shall not be lawful to register those trademarks. No requirement exists to show that they would be disentitled to protection in a court of law.

75. In Berlei, Lord Wilberforce observed in respect of s. 11 that the s. “has an appearance of simplicity, but on closer consideration this appearance is deceptive.” I wholeheartedly agree. His observation was prescient, given that his careful analysis of s. 11 was entirely rejected by Lord Diplock in the case of GE Trade Mark.

GE Trade Mark

76. GE Trade Mark was a case about rectification of the register. An electrical company was founded in 1886 in the UK and adopted the name General Electric Company Ltd. in 1903. That trademark comprising the letters “GEC”, subsequently became very wellknown and was used on its electrical goods. In 1892, a US company was incorporated under the name General Electric Company and it built up a similar business. Its trademark comprised of the two letters “GE” written within a circle or rondel. That GE mark became registered in England. An application was made by GEC for rectification of the GE mark on the basis of deception or confusion. Ultimately the House of Lords refused rectification and upheld the Court of Appeal in their finding that the use of the rondel mark would have resulted at a particular date in time in the likelihood of confusion among a substantial number of members of the public but that this likelihood was not caused by any blameworthy conduct on the part of the company GE that registered the trademark – what I described earlier as “confusion plus”.

77. Although this was an application for rectification – and governed by s. 32(1) of the 1938 Act, i.e. was it an entry wrongly remaining on the register – Lord Diplock found it necessary to consider s. 11 in some considerable detail. In tracing the history of s. 11, Lord Diplock asks whether a limitation upon the prohibition of the registration of a potentially deceptive or confusing trademark is imposed by the requirement that its use “would be disentitled to protection in the court of justice”. He points out that this question cannot be answered by linguistic analysis alone, and that the meaning of certain subsections in the 1938 Act can only be ascertained by applying a purposive construction to the Act as a whole, including the underlying policy to which the Act was intended to give effect.

78. His analysis starts at p. 324 with the history of the 1938 Act as follows: “The Act of 1938 does not purport to be a self-contained code of the whole of the law relating to trademarks. As its long title discloses, it was an Act to consolidate three previous Acts of Parliament: the Trade Marks Act 1905, the Trade Marks Act 1919, and the Trade Marks (Amendment) Act 1937. Recourse must therefore be had to these Acts to ascertain the underlying policy to which it was intended to give effect.

…

The right of property in a trademark was recognised at common law before it was the subject of any enactment. The Act of 1875 did not itself create any right of property in trademarks. As its title itself indicates and its provisions confirm, it simply provided for the registration of trademarks and spelled out the consequences of registration and nonregistration upon the proprietary rights of the owner of the trademark and the remedies available to him for the protection of those proprietary rights. The Act of 1875 must, therefore, be construed in the light of the common law relating to trademarks in 1875. I use the expression ‘common law’ to include the doctrines of equity applied in what at that time was the separate Court of Chancery.”

79. Lord Diplock observes that, prior to the 1875 Act, the only right of a proprietor of a trademark was to prevent its use by other persons through an injunction to restrain infringement. This was a discretionary relief, and the principles as to how the discretion should be exercised were settled by 1875. He notes that a right of property of this character calls for an accommodation between the conflicting interests of the owner of the monopoly, the general public as purchasers of goods to which the trademark is affixed, and other traders. He notes the interest of the general public requires they should not be deceived by the trademark but points out that this interest has to be accommodated with the vested right of traders in trademarks which they have honestly adopted and which by a public use have attracted a valuable goodwill. He points out that when markets were small and closed, it was necessary to develop the doctrine of honest concurrent user to deal with the situation where products of two traders who used similar marks could come to be on sale to the same potential purchasers with the consequent risk of their being misled as to the origin of the goods. In a critical passage he observed: “Under [the doctrine of honest concurrent user] a trademark remained entitled to protection in cases where the use of it had not originally been deceptive but a risk of deception had subsequently arisen as a result of events which did not involve any dishonesty or other wrongful conduct upon the part of the proprietor of the mark. If, however, his own wrongful conduct had played a part in making the use of the mark deceptive, the Court of Chancery would not grant him an injunction against infringement. This was but a particular application of the general equitable doctrine that he who seek equity must come with clean hands” (p. 326, paragraphs 35-45).

80. Lord Diplock went on to consider the wording of the original s., s. 6 of the 1875 Act, which provides: "6. The registrar shall not, without the special leave of the court, to be given in the prescribed manner, register in respect of the same goods or classes of goods a trade mark identical with one which is already registered with respect to such goods or classes of goods, and the registrar shall not register with respect to the same goods or classes of goods a trade mark so nearly resembling a trade mark already on the register with respect to such goods or classes of goods as to be calculated to deceive. It shall not be lawful to register as part of or in combination with a trademark any words the exclusive use of which would not, by reason of their being calculated to deceive or otherwise, be deemed entitled to protection in a court of equity; or any scandalous designs."

81. Lord Diplock observed that the first part of the s. permitted the court to permit the registration of identical marks notwithstanding the inherent risk of the public being deceived; this was to preserve the doctrine of honest concurrent user. He described the second part of the s., starting with the words “It shall not be lawful” as follows: “It imposes an absolute prohibition upon the registration of particular matter otherwise falling within the definition contained in s. 10. It is clearly designed to prevent the proprietor obtaining by registration protection for a mark of such a character that a court of equity would have exercised its discretion to refuse to grant to its proprietor an injunction to restrain its being infringed by a usurper. Since the mere fact that the use of a mark involved a risk of deceiving the public was not enough to disentitle it to protection against infringement by a usurper provided that the risk of deception was due to honest concurrent user, there was no conflict between the first and second parts of the s.”.

82. In relation to the wording of s. 11 of the 1905 Act he observed that the crucial words “it shall not be lawful to register” and “the use of which would by reason of its being calculated to deceive or otherwise be disentitled to protection in a court of justice” must bear the same meaning as the corresponding words in the Act of 1875.

83. The reason I have gone through GE in such detail, despite the Supreme Court treating it as confined to rectification applications and not first registrations in Montex, as discussed below, is that it shows the Supreme Court were fully aware of the alternative reading of s. 19, i.e. to treat the nature of the conduct leading to confusion as a necessary part of the analysis when deciding whether established confusion should prevent registration. As we will see from the analysis of Geoghegan J.’s decision below, he was fully aware of those arguments and chose not to follow them. In my view, that fatally undermines Diesel SpA’s argument that the cause of the confusion is relevant in determining whether s. 19 applies.

Supreme Court decision in Montex

84. If the approach taken by the House of Lords in GE Trade Mark had been followed by the Supreme Court in Montex, the likely consequence in the context of this case would have been that s. 19 would not have operated to block Diesel SpA, despite the admitted confusion of marks, because there is no allegation that Diesel SpA has engaged in conduct in respect of the use of a trademark that would disentitle it to protection in a court of law. In other words, no blame can attach to Diesel SpA for the cause of the confusion. In the words of Lord Diplock, the interests of the traders would prevail over those of the public. However, the Supreme Court took the opposite approach, with Geoghegan J. observing that that while GE Trade Mark appeared to be a “reasonable and sensible approach to an application for expungement” (p. 97), it did not apply to an application for first registration.

85. In the Montex proceedings, perhaps not surprisingly, given that Montex was seeking registration in those proceedings, and Diesel SpA is seeking registration in these proceedings, the positions adopted by the parties were the opposite to those adopted in these proceedings: Diesel SpA argued that confusion alone was sufficient to refuse registration under s. 19, whereas Montex argued that “confusion plus” is required.

86. However, there are similarities – in both sets of proceedings, the party arguing for the confusion plus interpretation was the party seeking registration – just as in the instant case – and was doing so on the basis that it was not blameworthy and therefore its mark should be registered despite the confusion – just as in the instant case. The only difference is that in Montex, Montex did not argue that the confusion was caused by Diesel SpA, whereas that is the position adopted by Diesel SpA in the instant case. But as is clear when one looks at the detail of the judgment of Geoghegan J., the breadth of the ruling means that it cannot be qualified as applying only in the particular circumstances that were before the Court in that case. In my view, the Supreme Court firmly shut the door on any argument that the cause of the confusion was relevant. The statements of principle as to the correct interpretation of s. 19 are of general application, and do not focus on whether the person seeking registration – or indeed the opponent to registration – would or would not satisfy a blameworthiness condition. Nor indeed do the principal judgments considered by Geoghegan J. – Berlei, GE Trade Mark, New South Wales Dairy Corporation v. Murray Goulburn Co-operative Co. Ltd. (1990) 171 C.L.R. 363. Their focus is on the correct interpretation of the equivalents of s. 19, irrespective of whether the confusion is alleged to have been caused by the party seeking registration or the party opposing it.

87. It will be recalled that the Supreme Court gave no weight to the findings of lack of bona fides on the part of Montex by the High Court, because Geoghegan J. took the view that the question as to whether it was mandatory to refuse registration should be addressed before considering a discretionary question. Accordingly, the Supreme Court was not considering the interpretation of s. 19 on the basis that the application for registration was being made by a person found to be blameworthy; rather it was looking at the interpretation of the s. in the abstract. Nonetheless, the Supreme Court was aware of the findings of O’Sullivan J. in respect of the bona fides of Montex: had the Supreme Court considered this relevant to its interpretation of s. 19, it would have addressed this.

88. The nature of the question being considered by the Supreme Court was squarely identified (at p. 93) at the start of the discussion by Geoghegan J. (with whom all the other members of the Court agreed) as follows: “There is really only one legal issue in this case. Does the inclusion of the words ‘be disentitled to protection in a court of law’ in s. 19 of the Act of 1963, have the effect that likelihood of deception or causing confusion on its own is not sufficient to prevent registration, but that there must also be some element of ‘blameworthiness’ on the part of the applicant. This problem, in the main, arises from the speech of Lord Diplock in General Electric Co. Ltd. (of U.S.A.) v The General Electric Co. Ltd. [1972] 1 W.L.R. 729. I will be returning to that case and its context later, but it is first necessary to consider the history of s. 19 and its antecedents.”

89. In my view, it is inherent in that question that it covers the instant situation, i.e. a situation where all are agreed that there is no blameworthiness on the part of the applicant. The fact that Diesel SpA argues that the confusion arises because of the blameworthy conduct of Montex does not take it outside the scope of the consideration of s. 19 in Montex: in many cases where there is confusion, it is likely to be because one or other party is alleged to have acted wrongfully. Indeed, Lord Diplock in GE Trade Mark adopted the view the statutory provisions on honest concurrent users were designed to address what I might describe as “no fault confusion”, and the reference to being “disentitled to protection in a court of equity” in s. 11 of the 1938 Act was there to cater for the situation where there was potential wrongdoing.

90. Geoghegan J. referred to s. 11 of the 1938 Act and considered the House of Lords

decision in Berlei in some detail. Having done so, he observes at p. 95 as follows: “I would interpret s. 19 as meaning that the registrar is bound to refuse registration if the mark is likely to deceive or cause confusion and would, prior to 1875 on that account, have been disentitled to protection in a court of equity, and likewise if, for any other reason, such mark would have been disentitled to such protection before 1875. This second aspect of refusal arises out of the words ‘or otherwise’. But there would appear to be no justification for introducing an element of blameworthy conduct such as passing off.”

91. That constitutes a decisive rejection of the confusion plus interpretation of s. 19 advanced by Montex in that case. But he does not stop there: he makes that point in different ways, and in response to various arguments, on four further occasions in the judgment.

92. Geoghegan J. goes on to address the submission made by Montex that GE Trade Mark supports its interpretation of s. 19. His first observation is that GE Trade Mark is a case about expungement: in fact, this is ultimately the basis upon which he distinguishes GE Trade Mark (as did O’Sullivan J., who interpreted s. 19 as requiring confusion only). He observes that Lord Diplock concluded that, on an application for expungement based on a trademark offending s. 11 of the 1938 Act, the application could only succeed if there was some blameworthy conduct since registration on the part of the registered owner which was now leading to confusion.

93. He notes that Lord Diplock’s conclusions do not seem to be relevant to an application for first registration, while conceding there are other passages which might give rise to some ambiguity on the question. He emphasises the difference between applications for first registration and applications for expungement, and repeats again the interpretation he advanced at p. 95 in more summary form, starting at the end of at p. 97, as follows:

“As far as an application for first registration is concerned there would not appear to be anything in s. 19 which justifies the importation of some element of blameworthy conduct in addition to the element of deception or confusion. I cannot accept the argument of counsel for the plaintiff that because there are some categories of confusing registrations which are permissible such as where there is honest concurrent user, s. 19 must be interpreted as imposing a prohibition only in cases where there is blameworthy conduct.”

94. This is of course the argument that Diesel SpA is now making: that because it is not in any way blameworthy, confusion should not prevent registration.

95. At the bottom of p. 98, in response to an argument based on a particular subsection of the Act, Geoghegan J. observes as follows: “But confusion other than these special instances of permitted confusion under the Act prevents registration irrespective of whether there is blameworthy conduct such as passing off or not.”

96. He then considers the Australian jurisprudence, where doubt was thrown on whether the blameworthiness elements referred to by Lord Diplock were intended by him to cover first applications for registration as well as applications for expungements. He concludes that the Australian case law is of no assistance, partly because of the extensive disagreement among the judges and partly because of differences in the structuring of the equivalent s. in Australia. Referring to Brennan J.’s judgment in New South Wales Dairy Corp, he comments as follows at page 100: “I also agree that if the element of blameworthiness is to arise at all, it can only be in relation to an application for expungement”.

97. Finally, in his review of the Australian cases, Geoghegan J. refers to the judgment of Tamberlin J. in the case of Canon Kabushiki Kaisha v. Brook (1996) 36 I.P.R. 88, pointing out that this judgment was further support for the view that on an application for original registration, the question of blameworthy conduct does not arise.

98. Next, he considers the Irish case law, noting that nowhere in the report of Coca-Cola Co. v F. Cade & Sons Ltd. [1957] I.R. 196 is there any suggestion that an opponent could not succeed, notwithstanding a finding of such confusion, without establishing blameworthy conduct. Similarly, he points out there is no indication that the question of blameworthiness was ever considered in the judgment of Murphy J. in Seven-Up v Bubble Up [1990] I.L.R.M. 204.

99. Geoghegan J. concludes on p. 102 with the following paragraph: “There was ample evidence before the hearing officer and again before the High Court to justify a finding of likelihood of confusion and, therefore, unless the appellant is correct in the submission that there has to be the element of blameworthiness the appeal must clearly be dismissed. For the reasons which I have indicated, I do not consider that blameworthiness in the sense referred to by Lord Diplock has to be established for it to be mandatory on the first defendant or the High Court on appeal to refuse registration under s. 19 of the Act of 1963, where there is proven likelihood of confusion.”

100. I have identified the five different occasions where Geoghegan J. points out that no element of blameworthiness is required so to make it clear that, contrary to the submissions of Diesel SpA, his finding is not in any way qualified or limited depending on the identity or possible blameworthiness of the person seeking registration, or indeed of the person opposing registration. The principle he identifies is clear and applies in all circumstances: blameworthiness is not a requirement under s. 19. That applies whether the applicant for registration is a person against whom there are allegations of blameworthiness or a person against whom there are no such allegations.

101. Considered in the light of the judgment, the submission of Diesel SpA that deceptive or dishonest conduct on the part of an opponent is relevant and may be determinative in respect of the application of s. 19 is obviously wrong; as is its submission that the Supreme Court did not conclude that considerations of blameworthiness in bringing about the confusion in the first place are irrelevant to s.

19. Neither of those arguments can be maintained in the face of the judgment of Geoghegan J.

102. Given the clarity of the decision, and the fact that it is binding on this Court, I find it unnecessary to address in any detail the arguments of the Controller that the purpose of s. 19 is to protect the public.

Treatment by trial judge of s. 19

103. The above analysis of GE Trade Mark and Montex makes it clear why the

decision of the trial judge on confusion cannot be upheld. He fully acknowledged at paragraph 278 that the simultaneous use of the two identical marks was likely to deceive and/or cause confusion within the meaning of s. 19 (a finding against which there is no appeal) and that the Irish case law – Coca-Cola Co, Montex, Jaguar Cars Ltd [2006] 1 I.R. 607 and Unilever Plc v Controller of Patents [2006] IEHC 427– was uniform in interpreting s. 19 as requiring refusal of registration if the mark was likely to deceive or cause confusion. Indeed, he had acknowledged earlier in his judgment that the concept of dishonesty or bad faith was not relevant to an assessment under s. 19 (see paragraphs 125 and 145 of the judgment). However, despite correctly stating the s. 19 test – the Controller is compelled to refuse registration if the mark is likely to deceive or cause confusion – and despite accepting the existence of confusion, he declined to refuse to register the mark because the cause of the deception/confusion was what he considered to be the dishonest, wrongful and unlawful copying of Diesel’s mark by Montex i.e. blameworthiness. An argument based on the necessity for confusion plus blameworthiness is precisely what was put before Geoghegan J. His judgment in Montex makes it clear that this interpretation was comprehensively rejected by the Supreme Court.

104. The trial judge’s approach was clearly informed by his conclusions that Montex had not acted bona fide, that it had copied Diesel SpA’s mark in 1979, and that he felt it to be unjust that confusion wrongfully caused could prevent registration. Nonetheless, the terms of s. 19, as interpreted by the Supreme Court, are quite clear and must be observed. The 1963 Act has addressed what must happen where registration is likely to cause confusion, through s. 19 and other provisions dealing with “permitted” confusion. The duty of the court is to apply the law. Section 19 represents the will of the Oireachtas, and it cannot be disregarded or set aside.

105. In effect, the trial judge treated s. 19 as being conditional in nature i.e. as only applying where the confusion is not the fault of any party, but as inapplicable where the confusion has been caused by the wrongful act of one party, although he does not articulate it as such. That was the interpretation given to s. 11 in GE Trade Mark but was not the approach taken in the Supreme Court decision of Montex (except in the context of an expungement case). The trial judge was not entitled to override s. 19 and direct registration of Diesel SpA’s application under the banner of first principles or equitable principles. By so doing, he erred in law.

106. That means the third question referred to this Court by the trial judge must be answered as follows: As regards the notion of confusion, conduct of an opposition party, such as deceptive or dishonest conduct, is neither relevant nor determinative in respect of the application of s. 19 of the 1963 Act.

CONCLUSION

107. In the circumstances, the appeal of Montex and the Controller will be allowed. The answers to Questions 1A and 3 conclusively determine the question of registration i.e. Diesel SpA must be refused registration of the mark. Accordingly, I do not propose to address Questions 4 or 5 since, irrespective of how they are answered, the answers to same cannot affect my conclusion on registration.

108. The decision of the High Court was an appeal under s. 57 from the decision of the Controller refusing registration. Section 57 permits the High Court to make such order confirming, annulling or varying the order or decision of the Controller. I see no reason to remit this long running matter to the High Court. The position is clear: all parties accept there will be confusion if Diesel SpA’s mark is registered. Section 19 makes refusal of registration mandatory where confusion will result. Accordingly, I will confirm the decision of the Controller (and to the extent necessary, vary it) in respect of the opposition by Montex to Trademark Applications 177240 and 177245 to refuse to allow them to proceed to registration on the basis that they offend against s. 19.

109. As far as costs are concerned, the parties are invited to correspond in relation to the question of the costs of the proceedings in the High Court and of the appeal and the panel will reconvene to deal with any issue.

110. The parties are also invited to consider the appropriate form of Order, including whether the decision of the Controller should be affirmed, and, in the absence of agreement, to make written submissions on same of no more than 1,500 words each, to be provided within 14 days from the date of delivery of this judgment.

111. Since this judgment is delivered electronically, I am authorised by Costello P. and Allen J. to state that they agree with it and with the orders proposed above.

Annex 1

1(A). Whether the High Court is required to determine that Diesel SpA is not the proprietor of the mark ‘DIESEL’ within the meaning of s. 25(1) of the Trade Marks Act, 1963 and/or that registration by Diesel SpA must be refused under s. 19 of the 1963 Act, having regard to the decisions of the High Court and the Supreme Court respectively in Montex Holdings Limited v. The Controller of Patents, Designs and Trade Marks and Diesel SpA [2000] 1 IR 577 and [2003] 3 IR 85? 1(B). Whether the Court erred in finding that the question as to whether Diesel Ireland had engaged or had not engaged in a bona fide use of the trade mark was not an issue which had already been decided conclusively by a court of competent jurisdiction and/or in finding that there was a lack of clarity about what O’Sullivan J. had decided with regard to that issue and whether the High Court was therefore required to reject as an abuse of process the adducing of further evidence on this issue in these proceedings.

2. Whether a first user of a mark abroad can claim to be proprietor of the mark in the State within the meaning of s. 25(1) of the Trade Marks Act, 1963 in priority to the first user of the mark in the State, in circumstances where there is no preexisting commercial arrangement or understanding between the first user abroad and the first user in the State, and there is no breach of any such arrangement or understanding, but where the first user in the State is found to have copied the mark from the first user abroad.

3. Whether, as regards the notion of confusion, that conduct of an opposition party, such as deceptive or dishonest conduct, was relevant and/or determinative in respect of the application of s. 19 of the 1963 Act.

4. (a) Whether copying the ‘DIESEL’ mark in the factual circumstances as found by the High Court constitutes fraud, dishonesty or bad faith on the part of Montex as a matter of law; and

(b) If so, what is the effect of this finding in assessing Montex's opposition under s. 25(1) and/or s. 19 of the Trade Marks Act 1963 in the registration of the ‘DIESEL’ mark by Diesel.

5. Whether the Court erred in law in the manner in which it assessed the evidence so as to reach its conclusion that Montex's predecessor had copied the Mark from Diesel SpA.