Sophistication of Consumers Stymies Claim

Posted: 10th August 2011

When one business uses the trade marks of another, an action can be brought for trade mark infringement and possibly also for ‘passing off’ – the term given to the situation in which a business attempts to profit by presenting itself in such a way that the buyer may confuse it with another business.

The outcome in such cases depends mainly on the court’s view of what the effect of the infringement or passing off would be in the market concerned. One of the main factors will be the knowledge and sophistication of the consumer.
Recently, Group Lotus Plc and Lotus Cars Ltd (the manufacturers of Lotus cars) brought various claims against a number of defendants all associated with the Team Lotus Formula 1 car racing team. The claims all had at their core the use of the word ‘Lotus’ in a motor-racing context.
The High Court was unmoved. In its view the businesses were sufficiently different and the sophistication of the consumers was such that there was no likelihood of confusion.