Facts of the case
The Claimants had carried on business as recruitment agents since around 1960. By the time of commencement of the action, the Claimants had many different divisions of their overall recruitment business, such as Reed Employment, Reed Accountancy and Reed Industrial Personnel. The Claimants also operated associated training businesses. The interviewing of potential candidates by the Claimants’ specialist staff was an important part of their business model.
In relation to their branding, the Claimants relied heavily on the REED mark to identify their business and in particular their high street trading premises. The Claimants were the proprietor of a registered trade mark for the word “REED” in respect of “Employment Agency Services included in class 35”. The Claimants also operated a Web site (reed.co.uk) which was used by both clients and candidates.
The Defendants were a well-known publishing business with a long history. They published such well-known titles as “The Estates Gazette”, “Computer Weekly” and “New Scientist”. A number of the Defendants’ publications carried recruitment advertising and in some cases such advertising was a significant part of the overall content of the publication.
The Defendants used the REED mark as part of their Reed Business Information logo (the “RBI logo”). It was accepted that there had been relatively long-standing historical confusion between the Claimants’ business and that of the Defendants. A number of witnesses suggested that they had themselves at one point been confused as to the existence of a relationship between the companies. However, since the companies had historically been operating in quite different fields, neither had substantially affected the other. Mere confusion between two businesses operating in two different fields had not led (nor could it properly have led) to a complaint of passing off or trade mark infringement.
All this changed with the coming of the web, which fundamentally changed the economics of the recruitment advertising industry. When the first stand-alone recruitment sites (his Lordship namechecked Monster and StepStone as the first movers) appeared, this caused a real threat to the Defendants’ recruitment advertising income.
The Defendants’ strategic response was themselves to move into recruitment advertising on the web, commencing with a site based on “Computer Weekly”. Sites for other of their specialist vertical publications followed. Within three years, the decision was taken by the Defendants to consolidate this activity and to create the UK’s leading horizontal recruitment site. This site would tie together vacancies from their various vertical markets, as well as vacancies from other markets. The project was ambitious and backed with a big budget. The site was to be operated under a new brand, “Totaljobs.com” although the RBI logo would be displayed and other direct references to the Defendants would also be made.
As is common in major web development projects, various “usability” studies were carried out during the development process. It was clear from the evidence relating even to the earliest of those studies that the use of the RBI logo led some users to assume a connection with the Claimants’ business.
The totaljobs.com site was developed through a number of versions starting in Autumn 1999. In parallel to this, a number of real world events also began to cause the Claimants concern. One particular event referred to was the 1999 Harrogate Show mounted by the Chartered Institute of Personnel and Development. The Claimants’ Managing Director gave evidence to the effect that he noticed an alarming shift at this show between the way the Defendants presented themselves, from sellers of advertising space to providers of jobs in their own right.
Throughout the development of totaljobs.com the Defendants and their new media advisers worked on various strategies to maximise traffic to the site. These various strategies (collectively referred to as “optimisation”) gave rise to the most interesting sections of the judgment and Pumfrey J’s judgment sets out a helpful round up of such techniques. In particular he recorded how:
- The Defendants deployed metatags on various visible and invisible pages of the totaljobs.com site including the keywords “Reed Business Information”;
- The Defendants “reserved” certain search terms with various search engines so that when users searched against those terms, a banner advertisement or pop-up with a link to totaljobs.com would be returned. Although the reference to totaljobs.com would appear as an advertisement rather than as a search result, it would typically appear alongside the search results and in some cases might take the form of a “spoof” search result.
(Other common site optimisation techniques are referred to in passing in the judgment but were not considered to be significant to the issues in the case).
The main launch of the site took place in January 2000. The launch version contained RBI branding more prominently than previous versions had done, despite the minority view among the Defendants’ executives to the effect that minimal reference should be made to RBI.
By early June 2000, it was apparent that the Defendants and their advisers were aware of confusion as to the extent to which the Claimants were connected with totaljobs.com. This confusion was likely to grow as the Claimants promoted their reed.co.uk site.
Towards the end of June 2000, the decision was taken by the Defendants to remove the RBI logo from the totaljobs site. Although that logo was removed from the site, reference to RBI remained in the copyright notice on the site. More significantly “Reed Business Information” remained among the metatags and the word “Reed” continued to be reserved with the Yahoo search engine.
In August 2001, the totaljobs.com site and its business were transferred to a separate company, Totaljobs.com Limited. At this point all visible reference to RBI disappeared from the site.
The issues
The key issues to be decided in the case were:
- Whether the Defendants services provided via totaljobs.com site were identical to the class of services for which the Claimants had registered REED as a trade mark.
- Whether the service provided by the Defendants was similar to the services in respect of which the Claimants had their registered trade mark and if so whether there was a likelihood of confusion capable of satisfying section 10(2) TMA 1994.
- Whether the Defendants’ use of REED as part of their mark gave rise to passing off
- Whether the Defendants had an own-name defence
- Whether the Claimants had any (other) legitimate complaint in relation to the optimisation and promotional techniques employed by the Defendants.
The Judgment
Identical Services?
The Defendants were trading within the services’ specification of the Claimants’ registered trade mark. Although it was not clear whether the Defendants’ services fell within the statutory meaning of an “employment agency”, the services provided by the Defendants were employment agency services because totaljobs.com acted as a go-between between its clients and candidates.
Similar Services – likelihood of confusion?
Even if the services were not identical they were certainly similar. There was clear evidence that the Defendants’ visible use of the logos and the word “Reed” was capable of causing confusion in the minds of the public.
Own name defence?
The “own name” defence under section 11(2) applied if the Defendant’s use of its name was in accordance with honest practices in industrial or commercial matters. The Defendants’ use of its name could not be said to be honest if they knew there was a risk of deception.
Passing Off?
The classical trinity of ingredients in a passing off action, reputation and confusion leading to deception and damage where present. Although this was not a case of deliberate passing off, in the sense that the Defendants were willing to accept confusion in the hope of receiving more business, the Defendants were aware of the possibility of confusion.
Complaints in relation to optimisation and promotional techniques
The use of “Reed” in invisible metatags constituted trademark use in the sense that its purpose or effect was to indicate the trade origin of the services. The short test, which needed to be applied cautiously, was to consider whether the use of the metatag told the truth about the site.
Only banner advertisements triggered by the word “Reed” specified by the Defendants would infringe. If the Defendants had reserved the word “Jobs” and their advertising was returned in relation to a search for “Reed Jobs”, this not due to any use of the word “Reed” by them and could not be an infringement. The only reserved key word to attract any criticism was “Reed” itself, which was reserved for a 12 month period on Yahoo from November 1999 to November 2000.
Although some effort appears to have been made by the Claimants’ Counsel to criticise optimisation practices in the round, the Judge did not accept it. He suggested that the Claimants generalised objection to these practices confused a potentially irritating form of advertising with passing off.
Comment
Pumfrey J’s judgment is the fullest treatment yet given by an English Court to the intellectual property questions raised by the use of common optimisation techniques. Although a claimant was successful on a previous metatag case (Roadtech v Mandata) the reasoning set out in this judgment tackles the questions much more fully. Even so, one is still left with the sense that the finding of infringement was at least in part an intuitive one, as opposed to one based strictly on statutory construction.
Reading the judgment in this case may also well lead you to the conclusion that optimisation is in a sense the new alchemy. Not only is the range of techniques extensive and sophisticated, but there also appears to be a growing body of knowledge in relation to the subversion of search engine logic. See the debate about the robots.txt file if you would like to know more.
It is perhaps all the more surprising in light of the scope for debate over the use and misuse of optimisation that Pumfrey J went out of his way to commend the two technical experts in the case for their helpful, intelligent and constructive approach. All too often the quality of expert evidence is singled out in judgments for quite the opposite reason
Finally, some comments were made in relation to other aspects of the preparation of the Claimant’s case which could be taken to suggest that even they were finding their way through unchartered legal waters. His Lordship commented on the fact that the true extent of objections to the invisible uses of the Reed mark only became apparent when the expert evidence was served shortly before trial. He also seems to have been puzzled by the lack of any substantial evidence as to the results returned against web searches for “Reed” as a single search term. That said, the Claimants largely succeeded in getting the findings of liability that they wanted and the next case of this type should be easier to run with the benefit of this judgment.
