Intellectual Property Law – Intelmark frustrates Intel in Court of Appeal

Area(s) of Law :
Intellectual Property Law
Court : Court of Appeal

Case Summary By :
Mark Engelman

Intelmark frustrates Intel as the Court of Appeal hears first ever trademark dilution case.

The Court of Appeal’s judgment of 15th May 2007 is the most recent episode in the dispute between Intel Corporation, the US computer chip manufacturer and Intelmark, the telemarketing brand of marketing consultancy CPM, a part of Omnicom Group Inc. ended with Intel grasping at a last life-line in the long fought battle over the CPM’s Intelmark brand. In 2003, California’s chip giant applied for a “declaration of invalidity” against CPM’s mark, this claim was rejected and Intel appealed.

In the Patent Office, Intel left bruised having dropped its claim that Intelmark had passed itself off as Intel and then lost its argument that Intelmark had taken unfair advantage of and diluted its reputation for computer chips. The Patent Office considered any link between the two brands “fleeting and shallow”.

Mr Justice Patten of the High Court, who heard Intel’s appeal, thought the two brands “called one another to mind” but did not feel Intel could show what harm, if any, Intelmark’s long standing use of its brand name might have on Intel’s commercial reputation.

Confusingly, Intel had also launched proceedings claiming that CPM had not used the Intelmark brand. It was forced to withdraw those proceedings and pay CPM’s undisclosed costs. It also tried to involve The International Trade Mark Association into its dispute, a strategy which also failed.

In what is the first time the issue of trademark dilution has been heard in the Court of Appeal, Intel claimed that merely because Intelmark’s business involved computers, the public would confuse the two brands, an argument Jacob LJ described as “nonsense”. Intel argued that Intelmark, and for that matter any other company using its name, merely by their presence in the commercial marketplace, not even in Intel’s computer chip market, diluted its reputation, would be “death by a thousand cuts” despite the fact it was unable to establish any economic harm to its reputation.

Referring the case to the European Court of Justice, Jacob LJ thought that the ECJ should interpret trade mark law in a manner which did not mean that a brand like Intel could claim dilution when the Intelmark brand name was used in connection with services as dissimilar as telemarketing services, even if Intelmark called Intel to mind “trade mark law need not be so oppressive and all powerful” said Jacob LJ. “sometimes, but perhaps not surprisingly, trade mark owners of big brands want more protection than they really need.”.
 
The nail in the coffin for Intel came when Jacob LJ concluded that the harm which Intelmark might represent to Intel must be shown to be real and tangible. Intel’s mere assertion of damage was just too remote and would leave trade mark owners in too monopolistic a position.

Intelmark’s Paul Woolley, COO of the CPM Group, said he was delighted with the decision, “Having stopped Intel in its tracks three times, we can now get on with the expansion of our business which for many years has been listed in the top 10 telemarketing companies in the UK”.

CPM represented itself and instructed Mark Engelman, Head of IP at Hardwicke Building, Intel Corporation was represented by CMS Cameron McKenna who instructed James Mellor Q.C. of 8 New Square.