Galway Free Range Eggs Ltd v O'Brien

• Jurisdiction: Ireland
• Judge: Ms. Justice Costello
• Judgment Date: 22 January 2019
• Neutral Citation: [2019] IECA 8
• Date: 22 January 2019
• Court: Court of Appeal (Ireland)
• Docket Number: Neutral Citation Number: [2019] IECA 8 Record No. 2016 378

[2019] IECA 8

THE COURT OF APPEAL

CIVIL

Costello J.

Peart J.

McGovern J.

Costello J.

Neutral Citation Number: [2019] IECA 8

Record No. 2016 378

BETWEEN/

GALWAY FREE RANGE EGGS LIMITED

APPELLANT/PLAINTIFF

- AND -

KEVIN O'BRIEN, CARMEL O'BRIEN

AND

HILLSBROOK EGGS LIMITED

RESPONDENTS/DEFENDANTS

Tort – Passing off – Brand name – Appellant seeking an order restraining the respondents from passing off their goods as the goods of the appellant by the use of the name “O’Briens of Galway Free Range Eggs” or any name for trading incorporating the words “Galway Free Range Eggs” – Whether the appellant had an established substantial reputation and goodwill in its brand name “Galway Free Range Eggs” in respect of its products in Galway and the West of Ireland

Facts: The appellant, Galway Free Range Eggs Ltd, appealed to the Court of Appeal from the order dated 26th May 2016 of the High Court (O’Connor J) dismissing its claim for an order restraining the respondents, Mr O’Brien, Ms O’Brien and Hillsbrook Eggs Ltd, from passing off their goods as the goods of the appellant by the use of the name “O’Briens of Galway Free Range Eggs” or any name for trading incorporating the words “Galway Free Range Eggs”. Firstly, the appellant said that the High Court had failed to rule on whether or not the appellant had established the existence of a reputation or goodwill in its product and in particular in its brand name. Secondly, it submitted that the High Court did not actually address the case advanced by the appellant. Thirdly, it submitted that the High Court misconstrued the regulations which require persons who sell eggs to mark them “free range eggs”, “barn eggs” or “eggs from caged hens”. Fourthly, the appellant argued that the trial judge erred in his approach to the survey evidence adduced by both parties and his rejection of that evidence, even when the two experts were in agreement and there was no conflict of evidence on the crucial issues of the existence of the appellant’s reputation and the possibility of confusion by members of the public between the two brands.

Held by Costello J that the appellant had an established substantial reputation and goodwill in its brand name “Galway Free Range Eggs” in respect of its products in Galway and the West of Ireland. Costello J held that EU and domestic regulations required the respondents to label their egg cartons “free range eggs” but it did not require them to include the description in their brand name; therefore, the regulatory obligation could not justify the inclusion of the words “free range eggs” in their brand name if it would result in passing off their goods as those of the appellant. Costello J held that the appellant was entitled to claim a reputation and goodwill in the phrase “Galway Free Range Eggs” and in the combination of the words “Galway” and “free range eggs”; its case was not confined to the use of the word “Galway”. Costello J noted that the test whether its reputation or goodwill in its brand name was infringed by that of the impugned brand name (as opposed to the get up of the product) is “Is there a real likelihood that the public would get an impression of a connection between the business of the appellant and the business of the respondents?” Costello J held that the appellant satisfied this test by means of survey evidence. Costello J held that the High Court erred in dismissing that evidence on the basis that it was of no probative value in light of decisions of the Supreme Court to the contrary, particularly where there was no contradictory evidence to be preferred by the High Court, and in criticising the appellant for failing to adduce evidence from shoppers or experts in the retail trade instead. Costello J held that the appellant was not required to show that it had suffered actual damage in order to succeed in its claim for passing off and it was entitled to an injunction to protect is reputation and goodwill in its brand name on a quia timet basis as it had established that the acts of the respondents constituted the tort of passing off.

Costello J held that she would allow the appeal and hold that the appellant was entitled to an injunction to restrain the respondents from trading under the name “O’Briens of Galway Free Range Eggs”.

Appeal allowed.

JUDGMENT of Ms. Justice Costello delivered on the 22nd day of January, 2019

1 This is an appeal by the plaintiff from the Order dated 26th May 2016 of the High Court (O'Connor J.) dismissing its claim for an order restraining the defendants from passing off their goods as the goods of the plaintiff by the use of the name ‘O'Briens of Galway Free Range Eggs’ or any name for trading incorporating the words ‘Galway Free Range Eggs’. The trial judge's reasons are contained in his judgment delivered on the 12th May 2016 ( [2016] IEHC 249). I would allow the appeal of the plaintiff/appellant against this judgment for the reasons set out below.

Background

2 In 1992, Ms. Catherine McGrath began selling eggs under the name ‘Galway Free Range Eggs’. She incorporated a company, the appellant, in 1994 and the appellant marketed its eggs under the name primarily in Galway and the West of Ireland. Ms. McGrath sold the company to the current proprietors in 2007.

3 Until 2012, the first and second named respondents supplied eggs to the appellant which were produced at their farm at Hillsbrook, Tuam, County Galway. In December 2011, they incorporated the third named respondent. They then commenced producing, selling and marketing eggs under the brand name ‘Free Range Eggs Galway’ through the third named respondent.

4 Mr. Kevin Towey, one of the shareholders and a director of the appellant, met with the first named respondent at his home to protest about the respondents” trading under their chosen name. While there was conflicting evidence as to what precisely was said at the meeting, it is common case that the respondents ceased marketing their eggs as ‘Free Range Eggs Galway’ after the meeting. The respondents began marketing their eggs in or about late 2012 primarily in County Galway as ‘O'Briens of Galway Free Range Eggs’.

5 The appellant objected to the respondents trading under this brand name and ultimately instituted these proceedings by a plenary summons dated the 6th June 2013.

6 The appellant applied for an interlocutory injunction to restrain the respondents from marketing their eggs under the name O'Briens of Galway Free Range Eggs. The appellant was refused interlocutory relief by the High Court (Gilligan J.) and the substantive proceedings were ultimately heard by the High Court (O'Connor J.) who dismissed the appellant's claim.

Decision of the High Court

7 The High Court judge recorded that Ms. McGrath commenced her enterprise in 1992 and that she incorporated the appellant in 1994 to carry on the business of selling free range eggs from Galway under the name ‘Galway Free Range Eggs’. He noted that the appellant registered a trademark certificate for eggs registered in Class 29 in September 2008 and that this trademark was used on the top of the appellant's egg boxes from 2008 up to around 2012. In 2012 the appellant changed the get up of the box used to sell eggs to what was referred to as a Sunburst box. He described the egg box label used for the sale of the respondents” free-range eggs since in or about late November 2012 using the brand name ‘O'Briens of Galway Free Range Eggs’. He appended to the judgment a copy of the Ballinasloe GAA Fixtures list for O'Briens of Galway Free Range Eggs Division 4B North for fixtures from September 2013 to November 2013 and a copy of the Galway County Under 21A and 21B Football Champions 2013 with a banner inscribed with ‘O'Briens of Galway’ and ‘Free Range Eggs’ underneath.

8 He referred to the European Communities (Marketing Standards for Eggs) Regulations 2009 ( S.I. Number 140/2009) which require egg boxes to comply with Article 12 of Commission Regulation (EC) Number 589/2008 of 23rd June 2008, as amended by Commission Regulation (EC) Number 598/2008 of 24th June 2008, which provides for the marketing of eggs.

9 He held that egg boxes must disclose whether the eggs are ‘free range eggs’, ‘barn eggs’ or ‘eggs from caged hens’.

10 In his judgment, he said that the appellant had always focussed on the use by the respondents of the word ‘Galway’ when marketing their free-range eggs to retail outlets. He focussed on the get up of the boxes of the two enterprises. He said he did not detect any intention on the part of the respondents ‘to get the free ride’ of which they were accused ‘when designing and using the defendants” box in 2012’.

11 The appellant and the respondents each adduced evidence from surveys. Mr. Cosgrove gave evidence on behalf of the appellant. He, along with two part-time workers, questioned two hundred shoppers outside three shops in Galway on the 19th July 2013. Mr. Oliver Walsh gave evidence on behalf of the respondents. His company conducted an online survey in 2016 from ninety-seven individuals on a database made up of business owners principally in the Galway area. Mr. Cosgrove found that 38% of the customers surveyed thought it was possible to confuse the respondents” brand with that of the appellant. Mr. Walsh found that 71% of those who considered brand to be important felt that it was not possible to confuse the two brands, though, in what appears to be a mistaken reading of the results in his report, the trial judge recorded this as a finding that 71% of those surveyed who thought branding was important thought that it would not be possible to confuse the two boxes.

12 The High Court endorsed the decision of McCracken J. in SmithKline Beecham plc. v. Antigen Pharmaceuticals Limited [1999] 2 ILRM 190 at 197 which concerned the launch of ‘SOLFEN’ into the same market as served by ‘SOLPADEINE’. McCracken J. was sceptical as to the value of...