The idea that “human rights” should have implications for a dispute between two companies over the advertising of dog medicines might seem strange. But a recent High Court battle between two rival manufacturers of such products has made clear that the Human Rights Act can be used as a shield by advertisers to help fight off legal action aimed at preventing so-called “comparative advertising” – a huge part of the campaigns in the recent spat between Sky and Virgin Media.
The case – Boehringer versus Vetplus – is the latest twist concerning the widespread and often contentious practice of companies advertising and promoting their own products and services by reference to those of their competitors. Sometimes such advertising can go too far and cause complaints to be made to the Advertising Standards Authority; however, in more serious cases, it can lead to litigation.
In the UK, there has been a succession of high-profile examples of aggrieved brand owners suing rivals over hurtful comparative advertising. One of the most famous examples was British Airways’ High Court action against Ryanair’s series of ads comparing its prices with those of its rival, among which were ads under the strapline “Expensive BA*****S”.
BA lost its case for trademark misuse, but the courts have since made it clear that denigration of a rival’s trademark is no longer permissible. More recently, mobile phone operator O2 has taken its on-going claim with rival Hutchison 3G, over the alleged misuse of O2’s bubble trade imagery, to the European Court of Justice (ECJ).
Almost invariably, comparative advertising will involve an advertiser using its rival’s trademark to help make their point. Potentially, this exposes the advertiser to a legal claim for trademark infringement if the use it makes of its competitor’s mark is “not in accordance with honest practices”. Another risk is that if a comparative ad is misleading, it may invite a claim for malicious falsehood – or even libel.
For brand owners on the receiving end of such campaigns, the trouble with legal action is that the disputed ad campaign will usually have run its course long before the case reaches trial. So an aggrieved party might well want to stamp on the disputed ads immediately and try to prevent further publication until the case has been heard. This involves asking the court to impose an interim injunction to prevent use of the ads pending a final judgment at trial.
This is the scenario that arose in the recent Boehringer vs Vetplus case. In April, Boehringer sued Vetplus over a comparative ad in which Vetplus alleged that it had tested one of Boehringer’s dog medicines and found it to contain much smaller concentrations of active ingredients than those claimed on the label. Boehringer argued the claims were not true and that if the ads were to run its reputation and trademarks would suffer serious damage. After its application for an interim injunction was dismissed by the High Court, Boehringer appealed. But the Court of Appeal dismissed its appeal.
In simple terms, the appeal court has agreed with Vetplus that its comparative advertising was an exercise of its right to “freedom of expression” as enshrined in UK law under the Human Rights Act. The HRA requires claimants to show that their case is “likely” to succeed, in order for an interim injunction to be granted. Previous rulings by the courts had created doubt that the HRA applied in such cases.
The Vetplus decision is important because it confirms that it will be more difficult in practice for a party aggrieved by a competitor’s comparative advertising to muzzle the ads pending trial. It remains to be seen whether the ruling will encourage advertisers to take more risks in what they say about their rivals from now on.
There is some good news for brand owners, however. The Court of Appeal did not agree that the rules applicable to libel cases should apply to trademark infringement cases. That would have made it virtually impossible for aggrieved parties to obtain an interim injunction except where the offending ads were obviously misleading.
As is confirmed by this latest ruling, the right to freedom of expression is now a factor that parties will have to bear very clearly in mind when they consider trying to spike competitors’ advertising in the courts. Yes, commercial advertisers really do have human rights too.
Mike Gardner is a partner at Wedlake Bell, the commercial law firm