Neutral Citation Number: [2007] EWHC 63 (Ch)
Case No: CH/2006/APP/0507
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 24 January 2007

Before :

THE CHANCELLOR OF THE HIGH COURT
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Between :

	HACHETTE FILIPACCHI PRESSE S.A. 	Appellants	
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	SAPROTEX INTERNATIONAL (PROPRIETARY) LIMITED	Respondents	

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Mr Colin Birss (instructed by Bristows) for the Appellants
Mr Iain Purvis QC (instructed by Greenwoods) for the Respondents

Hearing date: 16th January 2007
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Judgment
The Chancellor :

Introduction

1.	Hachette Filipacchi Presse SA (“HFP”) is the publisher and distributor of the magazine ‘ELLE’.  It was first published in France in 1945.  It has been published in the UK since 1985.   It has a substantial circulation in both countries and elsewhere.   The magazine and the readership at which it is aimed were described by the deputy director of its intellectual property department, Ms Fabienne Sultan, as follows:

“The ELLE magazine is tailor-made to appeal to women. It is principally a fashion and lifestyle magazine with a strong focus on women’s issues, fashion goods such as women’s clothing, shoes and fashion accessories, beauty and lifestyle themes. The ELLE magazine is principally directed to and read by a wide audience of all ages, urban-based, educated, career-orientated, upmarket women with significant disposable income.”

In addition to its business as publisher and distributor of the magazine HFP sells fashion goods through various channels, namely magazine and mail order, its website launched in November 1995, since 1996 a merchandising programme carried on through its exclusive licensee ActifGroup and through designer and factory outlets.   Its turnover in such goods is substantial. HFP is and for many years has been the registered proprietor in the United Kingdom of the mark ELLE, in both plain and stylised form, under classes 16, 25 and 41, in respect, inter alia, of periodicals relating to women and women’s clothing.
2.	Saprotex International (Proprietary) Ltd (“SIP”) is the wholly owned South African subsidiary of KAP Beteiligungs AG, a company incorporated in Germany.   KAP has two divisions one of which manufactures handknitting yarns.  SIP is a company in that division.  It is the largest manufacturer of such yarns on the continent of Africa.  SIP is the registered proprietor in South Africa of the trade mark ELLE in respect of both yarn and knitting patterns.   It uses that mark as the principal mark for exports of handknitting yarn.   In 2001 SIP started to export its yarns under the mark ELLE to the United Kingdom through Quadra (UK) Ltd as its distributor.   In the three subsequent years SIP became one of the three leading suppliers of fashion yarns in the UK.   In the same period SIP has exported substantial quantities of yarn and knitting patterns to Australia, New Zealand and the United States.
3.	On 24th June 2002 SIP applied to register the mark ELLE in relation to knitting wool and yarn in class 23.   On 2nd May 2003 HFP gave notice of opposition.   It specified its earlier UK registered trade marks for the mark ELLE and claimed that the application offended ss.5(2) and 5(3) Trade Marks Act 1994.    Those subsections provide (the latter as amended by Reg.7 Trade Marks (Proof of Use etc) Regulations 2004):

“5(2) A trade mark shall not be registered if because –
(a) it is identical with an earlier trade mark and is to be registered for goods or services similar to those for which the earlier trade mark is protected, 
or
(b) it is similar to an earlier trade mark and is to be registered for goods or services identical with or similar to  those for which the earlier trade mark is protected,
there exists a likelihood of confusion on the part of the public, which includes the likelihood of association with the earlier trade mark.

(3) A trade mark which -
(a) is identical with or similar to an earlier trade mark,
(b) [...]
shall not be registered if, or to the extent that, the earlier trade mark has a reputation in the United Kingdom....and the use of the later mark without due cause would take unfair advantage of, or be detrimental to, the distinctive character or the repute of the earlier trade mark.”

4.	SIP filed a counterstatement on 9th September 2003.  It admitted the earlier marks on which HFP relied but denied any similarity between knitting wool and yarns and any of the goods or services covered by the earlier marks.   It denied any likelihood of confusion on the part of the public or that any unfair advantage of the earlier marks would be taken if the mark of which SIP sought registration was used.
5.	HFP supported its opposition with four witness statements made Ms Fabienne Sultan and one from each of its solicitor, Abida Rifat Chaudri, and the director of operations of Designer Yarns Ltd, Mr David Watt.  SIP relied on witness statements of its managing director Mr Michael Cole, its solicitor Mr Philip Sloan and its group marketing manager Ms Sharon Farr.   The contested application for registration came before a hearing officer, Mr Michael Reynolds, on 16th May 2006.  He considered the witness statements, their voluminous exhibits and the submissions of counsel, but there was no cross-examination of any witness.   He dismissed the opposition of HFP for the reasons given in his written decision dated 8th June 2006.   
6.	HFP now appeals from that decision.   It contends that the Hearing Officer erred in principle in relation to the opposition under both ss.5(2) and 5(3), that this court should discharge his order and uphold the opposition of HFP to the application for registration of the mark ELLE made by SIP.   I shall deal with those contentions in due course, but, first, I should refer to the principles to be applied by the court on an appeal such as this and then consider the Hearing Officer’s decision in more detail.
The principles to be applied on an appeal from a hearing officer

7.	There was no dispute as to what the principles are.  Nevertheless I should refer to them in some detail as the necessary background to a consideration of the Hearing Officer’s decision and the submissions made to me.  The appeal lies to the High Court under s.76 Trade Marks Act 1994.  Accordingly CPR 52.11 applies, the appeal is limited to a review of the decision of the Hearing Officer (no submission having been made to the effect that justice requires a rehearing), and the appeal may be allowed if this court considers that the decision of the Hearing Officer was “wrong” (no suggestion of a serious procedural or other irregularity in the proceedings before the Hearing Officer being made).
8.	The proper approach of the court to an appeal such as this has been considered in a number of recent cases of the highest authority, most recently by Robert Walker LJ in REEF TRADE MARK [2003] RPC 5.   That case, like this, was a contested application for registration of a trade mark.   Pumfrey J had allowed the appeal from the Registrar.  One of the issues before the Court of Appeal was whether he was entitled to do so.   In paragraphs 18 to 23 Robert Walker LJ considered the earlier cases of Benmax v Austin Motor Company Ltd [1955] AC 370; Edwards v Bairstow [1956] AC 14; Re: Grayan Building Services Ltd [1995] Ch.241; Biogen Inc v Medeva plc [1997] RPC 1; Pro Sieben Media AG v Carlton UK Television Ltd [1999] 1 WLR 605; Norowzian v Arks Ltd (No 2) [2000] FSR 363 and Designers Guild Ltd v Russell Williams (Textiles) Ltd [2000] 1 WLR 2416.  He concluded that the judge’s approach had not been wrong but that his formulation of the relevant principle was a somewhat meagre summary of a complex point. 
9.	Robert Walker LJ then (paragraphs 24 and 25) distinguished an inference derived from a series of primary facts, which is itself a simple matter of fact, from one which involves a process of evaluation.   In paragraphs 26 and 28 he added:

“26.	How reluctant should an appellate court be to interfere with the trial judge’s evaluation of, and conclusion on, the primary facts? As Hoffmann LJ made clear in Grayan there is no single standard which is appropriate to every case. The most important variables include the nature of the evaluation required, the standing and experience of the fact-finding judge or tribunal, and the extent to which the judge or tribunal had to assess oral evidence.
[27....]
28.	In this case the hearing officer had to make what he himself referred to as a multi-factorial comparison, evaluating similarity of marks, similarity of goods and other factors in order to reach conclusions about likelihood of confusion and the outcome of a notional passing-off claim. It is not suggested that he was not experienced in this field, and there is nothing in the Civil Procedure Rules to diminish the degree of respect which has traditionally been shown to a hearing officer’s specialised experience. (It is interesting to compare the observations made by Lord Radcliffe in Edwards v Bairstow [1956] AC 14, 38-9, about the general commissioners, a tribunal with a specialised function but often little specialised training.) On the other hand the hearing officer did not hear any oral evidence. In such circumstances an appellate court should in my view show a real reluctance, but not the very highest degree of reluctance, to interfere in the absence of a distinct and material error of principle.”

Counsel for HFP does not suggest that these principles do not apply to this appeal.  He contends that the Hearing Officer did indeed make errors of principle.  To identify the alleged errors relied on it is necessary to describe the Hearing Officer’s decision in some detail.

The decision of the Hearing Officer

10.	In paragraphs 1 to 16 the Hearing Officer described the parties, their trading activities and the issues for his determination.  In paragraphs 17 to 35 he dealt with what he called “The Knitting Business and consumer ends”.  He did so by reference to the material passages in the witness statements of Mr Cole, Mr Sloan, Ms Farr, Ms Sultan, Mr Watt and Ms Chaudri.  In paragraph 36 he noted that issues arise in relation to who constitutes the average consumer for knitting wool and yarn on the one hand and the goods for which ELLE enjoys a reputation on the other.  He proposed, therefore, to deal with his findings in relation to those issues as a preliminary to considering the grounds of objection themselves.  He then considered the knitting market (paragraphs 37 to 39), the profile of the typical knitter (paragraphs 40 to 42) and the ELLE brand’s link with knitting (paragraphs 43 to 50).
11.	In relation to the knitting market the Hearing Officer recorded that it was common ground that knitting as a pastime started to decline around 1990 but enjoyed something of a revival about a decade later, attributed by the parties to an increase in leisure time and the fact that “a number of celebrities revealed themselves to be knitters”.   The material date for the purposes of these proceedings is 24th April 2002.  There was an issue as to whether the revival had by then started and if so its extent.   In paragraph 39 of his decision the Hearing Officer stated:

“What is more difficult to establish is whether the renewed interest in knitting amongst a younger generation progressed beyond a number of catchy news items and became a more deep-seated revival of knitting as a pastime. On the evidence before me I am unable to conclude that the latter was the case by the material date in these proceedings.”

12.	In relation to the profile of the typical knitter the Hearing Officer relied on the evidence of Mr Watt, as effectively confirmed by Mr Cole, that 

“once the typical UK knitter could have been described as 50-60 years old, a mother or grandmother knitting for her children or grandchildren, not working and not a career woman, not having independent significant disposable income and unlikely to buy magazines such as Elle...”

The Hearing Officer then considered how that profile might have changed in the course of the revival of knitting to which he had earlier referred.   He continued in paragraph 42:

“I conclude from the evidence that at some time during the period commencing in 2001/2, knitting may have come to the attention of a wider audience than had traditionally enjoyed it as a pastime. But it is not possible to ascertain how deeply an interest in knitting penetrated a younger audience and it is not possible to say with certainty what the position was at April 2002 or whether occasional links with celebrities and fashion designers had any lasting impact in terms of giving knitting more of a fashion image. I will, therefore, approach the average consumer test with these considerations in mind when I turn to my decision.”

13.	The Hearing Officer then considered the Elle brand’s link with knitting by reference to the four factors on which counsel for HFP relied.   They were (1) the fact that knitting patterns appeared in the UK edition of the magazine Elle until 1993, (2) such patterns appeared in the French edition until 2001, (3) the Elle Knitting Book published by HFP in 1985 and (4) a parody consisting of a card entitled HELL, subtitled “Knitters Special” and available in Holborn in August 2005.   In paragraphs 44 to 47 the Hearing Officer considered each of these factors.   He found that factors (3) and (4) contributed little to establishing what the public perception was in April 2002.  He considered that the French Edition of Elle, factor (2), might have had some slight impact and that a few English consumers might have seen the knitting patterns so that “some lingering association between the Elle brand and knitting would result”.  He was not convinced that factor (1) could have had any material residual effect nearly a decade later.  His overall conclusion on the submission of counsel for HFP “in the round” was:

“I consider that it was overstating the position to claim that the above-mentioned factors established a natural association between knitting and the magazine/clothing.”

14.	In paragraphs 51 to 76 the Hearing Officer dealt with the objection under s.5(2).  He set out the terms of the sub-section (paragraph 51) and referred (paragraph 52) to the well-known guidance provided by the decisions of the ECJ in Sabel BV v. Puma AG [1998] R.P.C. 199, Canon Kabushiki Kaisha v. Metro-Goldwyn-Mayer Inc [1999] R.P.C. 117, Lloyd Schuhfabrik Meyer & Co GmbH v. Klijsen Handel B.V. [2000] FSR 77 and Marca Mode CV v. Adidas AG [2000] E.T.M.R. 723.  He noted that the rival marks were identical so that the matter came within the boundaries of the subsection.  Accordingly, he noted, the submissions before him concentrated on the distinctive character of HFP’s mark, whether the respective sets of goods passed the threshold test for similarity and if so, whether as a consequence and as a matter of global appreciation there was a likelihood of confusion (paragraph 53).
15.	With regard to the distinctive character of the mark the Hearing Officer recorded (paragraph 57) that counsel for SIP accepted that a reputation could be claimed by HFP in relation to Elle branded women’s clothing including that directed at a youngish audience (paragraph 59).   He considered that (paragraph 57):

“the modest inherent qualities of ELLE as a mark had been improved through use by April 2002.”

16.	The Hearing Officer then turned to the issue of similarity of goods.  He referred to the principles established or exemplified in Canon Kabushiki Kaisha v. Metro-Goldwyn-Mayer Inc [1999] R.P.C. 117, 133 para 23, the judgment of Jacob J in British Sugar Plc v James Robertson & Sons Ltd (Treat), [1996] RPC 281 and the judgment of Patten J in Intel Corp v Sihra [2004] ETMR 44.   In paragraph 64 he recorded that the comparison he had to make was “between on the one hand knitting wool and knitting yarn and on the other women’s fashion clothing directed particularly at a younger audience”.
17.	The Hearing Officer then noted that the former might be used in the making of the latter but thought it safer to apply the Canon/Treat tests to the circumstances of this case (paragraphs 65 and 66).   He considered that the uses of the respective products were clearly different (paragraph 66), the respective trade channels and distribution processes were well separated (paragraph 67) and neither was complementary to or in competition with the other (paragraph 68).   He concluded (paragraph 69):

“Consumer perception is, of course, important in all this and that in turn will be informed and influenced by trade practices. My overall conclusion based on the above considerations is that, whilst I cannot say that there are no points of similarity between the respective goods, they fail in my view to pass the threshold test referred to in Intel Corp v Sihra. If I am wrong in that then I would hold that there is a low degree of similarity. The difference between those positions is not of purely academic interest. If the goods do not have the requisite “recognisable degree of similarity” then the applicant’s case fails under Section 5(2) on this point alone. If the better view is that there is a low level of similarity but one which at least passes the threshold test then I must go on and consider whether there is a likelihood of confusion.”

18.	The Hearing Officer then proceeded to consider the likelihood of confusion on the footing that he was wrong in his conclusion on similarity (paragraph 70).   On that footing:

“the question becomes one of the impact on likelihood of confusion of a greater degree of distinctiveness on the part of the opponent’s (identical) mark despite a low or lesser degree of similarity between the goods (see Merlin Trade Mark O/043/05 at paragraph 44).”

19.	The Hearing Officer then (paragraph 71) considered that the average consumer profile for women’s fashion clothing of the type that would appeal to the target audience of the magazine was quite different from that for knitting wool and yarn even allowing for the resurgence of knitting as a pastime.  He noted (paragraph 72) that the ELLE brand did not enjoy a monopoly in the market place and (paragraph 73) that there was no evidence of any actual instance of confusion.   The Hearing Officer concluded (paragraphs 74 to 76):

“74. Confusion may be fleeting or trivial and thus go unrecorded, or it may be so absolute that the consumer is completely taken in. I do not think it is profitable for me to enter this particular debate. The absence of any instances of actual confusion has not influenced my decision.
75. It seems to me that in the light of the opponent’s reputation, use of an identical mark on knitting wool and knitting yarn may for some people trigger an association. But, even assuming as I do for present purposes, that there is ‘threshold’ similarity between the goods I am not persuaded that any such association will amount to more than a bringing to mind. I do not consider that a sufficiently close link has been established between the respective sets of goods that a significant number of consumers will consider that they share the same trade source.
76. The way that the matter has been put in the European cases is that the reputation of a mark does not give grounds for presuming a likelihood of confusion simply because of a likelihood of association in the strict sense (Marca Mode CV v Adidas AG, paragraph 41). But if the association between the marks causes the public to wrongly believe that the respective goods came from the same or economically linked undertakings, there is a likelihood of confusion within the meaning of the section (Canon v MGM paragraph 29). This is not a case which in my view leads to the consequence mentioned in the Canon case. The opposition fails under Section 5(2) in so far as it is based on HFP’s women’s clothing registrations. [Counsel for HFP] accepts that in the event of such a finding he cannot do any better when it comes to the Class 41 services.”

20.	The Hearing Officer then turned to the opposition under s.5(3).   He set out the terms of the subsection (paragraph 77) and noted (paragraph 78) that in the light of his finding in relation to s.5(2) he was approaching s.5(3) on the basis that the goods did not pass the threshold test for similarity.   He then referred to the scope of the subsection, as considered in the cases which he cited, and noted that it was common ground that the relevant principles could be derived from them.   He summarised the propositions advanced by Counsel for HFP in these words (paragraph 81):

“that HFP’s ELLE mark is highly distinctive, and that Saprotex have adopted an identical mark which will call to mind the ELLE brand and obtain a free-ride on the reputation established by HFP. The opponent’s case is thus based on taking unfair advantage. Detriment is also said to be inevitable but in reality is not said to offer as strong a case as unfair advantage.”

21.	The Hearing Officer noted (paragraph 83) that counsel for SIP accepted that the mark ELLE had enjoyed the requisite reputation as far as the magazine is concerned.  For the purposes of this appeal it is not necessary to consider his conclusions so far as women’s clothing is concerned.   In paragraph 85 to 87 he stated:

“85.	I have already accepted for Section 5(2) purposes (where the opponent’s case was based primarily on its clothing registrations) that because of the reputation of the ELLE brand some people may make an association if they also encounter the same mark in use in relation to knitting wool or knitting yarn. The same also holds true in relation to the magazine where there is a longer standing and more deeply-rooted reputation.
86. The link comes about in each case because ELLE is a mark that is strongly associated with female fashion. [Counsel for HFP] referred me to Exhibit FS4 as capturing the essence of the brand concept and hence the values associated with the brand. FS4 is a Hachette Filipacchi Merchandising booklet from 1998/9 entitled ‘ELLE The Brand Business’. It describes the ELLE consumer target as being “18 to 35 year old women, urban, educated, career-orientated, upper-middle case, active, modern, open-minded, feminine and sensitive to fashion”.
87. As I have already indicated that represents a very different target audience to the market for knitting wool and knitting yarn. I accept there will be cross-over trade at the margins and it may well be that knitting will enjoy the occasional fashion revival with a younger audience.
88. There is no evidence from consumers themselves to help me gauge the nature, extent and effect of any association that is or may be made between the respective product areas or what would flow from any such association. My own view is that an association may exist at the margins but that it will not be particularly strong.”

Counsel for HFP relies on these paragraphs as a finding of a sufficient association between the mark Elle, as applied to the magazine, and knitting wool and yarn.

22.	The Hearing Officer then went on to consider the issue of unfair advantage.   In that connection he referred to the ‘Chevy test’ as formulated in the speech of the Advocate-General in General Motors Corporation v Yplon SA C-375/97; the judgments of Pumfrey J in Daimler Chrysler AG v Alavi [2001] RPC 42; Patten J in 4 Intel Corporation v Sihra [2004] ETMR 4 and Peter Smith J in Mastercard International v Hitachi Credit (UK) plc [2004] EWHC 1623.   He concluded (paragraph 91):

“I should just add that, whilst the above extract refers to real evidence of the claimed form of damage, this cannot mean that there must be actual evidence of unfair advantage or detriment having occurred. In many cases that come before Registry Hearing Officers the mark under attack is either unused or there has been only small scale and recent use. No evidence of actual damage is possible in such circumstances. I, therefore, interpret the above reference [“to real as opposed to theoretical damage”] to mean that the tribunal must be possessed of sufficient evidence about the use of the earlier trade mark, the qualities and values associated with it and the characteristics of the trade etc that it is a reasonably foreseeable consequence that use of the other side’s mark will have the claimed adverse consequence(s).”

23.	The Hearing Officer also referred with approval to a passage from the decision of Mr Geoffrey Hobbs QC, sitting as a deputy High Court judge in Electrocoin Automatics Ltd v Coinworld Ltd [2005] FSR 7 that

“....in order to be productive of advantage or detriment of the kind prescribed, ‘the link’ established in the minds of people in the market place need to have an effect on their economic behaviour.  The presence in the market place of marks and signs which call each other to mind is not, of itself, sufficient for that purpose.”
 
24.	The Hearing Officer summarised the case of counsel for HFP to the effect that SIP would gain a free ride on the back of HFP’s promotion of and reputation in its ELLE brand.   In that connection he quoted from the decision of OHIM in Mango Sport System SRL v Diknah SL [2005] ETMR 5.   In that case OHIM was concerned with an application to register the word MANGO as a community trade mark in class 9 for protective helmets.  The opponent was the proprietor of the same mark registered in Spain in class 25 for clothing for men, women and children.  It opposed the application under the Council Trade Mark Regulation equivalent of s.5(3).  The opposition succeeded both in the registry and before the first Board of Appeal of OHIM.  In paragraphs 34 and 35 the Board of Appeal said:

“34. As to the mark applied for, whilst it may be the case that technical considerations are relevant, aesthetic considerations may be equally relevant since the goods in the application could be sold for use in leisure and other sporting activities and be targeted at the non-professional. Thus it is conceivable that the public buying “MANGO” clothing might also carry out a sporting, leisure or DIY activity in which protective helmets are worn and the goods covered by the earlier mark could complement the goods in the application, which, as discussed already, cannot be restricted to the sport of cycling. It cannot be excluded that young, sporty, dynamic and fashion conscious women, who are precisely the focus of the opponent’s MANGO marketing strategy, will strive to match their accessories to their collections of MANGO clothes, and as part of that image will wear co-ordinating headgear.

35. Given the identify of the marks, the complementary nature of the goods, and the fact that the word MANGO is highly distinctive in relation to the goods concerned, and the extensive nature of the reputation throughout Spain, unfair advantage within the meaning of Article 8(5) cannot be excluded. It is highly likely based on those considerations that the applicant will benefit from and free ride on the opponent’s successful marketing efforts. In that sense it will derive an unfair advantage in Spain from the link the relevant public will make to the earlier mark which already enjoys substantial reputation there.”

25.	The Hearing Officer concluded:

96. I accept that particular care is needed where identical marks are involved. But in other respects the circumstances in MANGO do not seem to me to be helpful to the opponent’s cause. The goods, whether one takes magazines or clothing, are not complementary and at the most (in the case of clothing) have a low degree of similarity. Importantly, too, the image and qualities associated with the opponent’s brand do not appear to be particularly relevant to the applicant’s goods given the typical consumer profile associated with those goods and even allowing for some grey areas at the margins of the respective trades.

97. The matter can be considered from the perspective of Mr Hobbs’ question posed in the Electrocoin case (see the passage quoted above). Would the economic behaviour of the actual or potential purchaser of ELLE brand knitting wool or knitting yarn be influenced to a material extent as a result of any association that might be made with the goods for which the opponent’s mark has a reputation? For instance would Saprotex’s sale of knitting wool increase to a material extent (or at all) as a result of such an association. In my view it would not or, if it did occur at all it is likely to be to an immaterial extent.

98. On that basis the opposition fails on the basis of the unfair advantage claim. As I indicated earlier the case on detriment was not pressed and would not afford the opponent any better prospect of success.”

26.	I have referred to the decision of the Hearing Officer at some length as the necessary preliminary to a proper consideration of the arguments for HFP advanced on this appeal.   They are not the same as those made to the Hearing Officer and rely, to some extent, on the structure of his decision as a whole.

Opposition under s.5(3)

27.	Counsel for HFP recognised the burden facing him on an appeal such as this.   He accepted without reservation the principles to be applied by this court to which I have referred in paragraphs 7 to 9 above.  He contended that the Hearing Officer had erred in principle in two respects.   
28.	The first alleged error he described as ‘structural’.   Counsel points out that in the section of the decision which runs from paragraphs 37 to 50 the Hearing Officer dealt with the knitting market, the profile of the typical knitter and the link between the Elle Brand and knitting separately from and preliminary to the specific issues which arise under s.5(3).   He suggests that the conclusions to which the Hearing Officer arrived in paragraph 50 in relation to the four matters on which HFP relied, as described in paragraph 43, were carried forward without any further consideration to the issue of association arising under s.5(3) which he dealt with in paragraphs 83 to 88.   Counsel submits that if the Hearing Officer had revisited the four factors on which HFP relied in the specific context of s.5(3) he must have concluded that the opposition under that section was made out.   Accordingly the conclusions to which he did come in paragraphs 96 to 98 are unsustainable.
29.	This is disputed by counsel for SIP.   He submits that the relevant conclusion of the Hearing Officer is that contained in paragraph 75 which was carried forward to paragraphs 85 to 88 to found a conclusion in paragraph 88 that the relevant association was “not particularly strong”.  He contends that that was a conclusion of the Hearing Officer which this court has no sufficient reason to disturb.   He contends that in the light of that conclusion the Hearing Officer was entitled to distinguish Mango Sport System SRL v Diknah SL [2005] ETMR 5. as he did.   He submits that it is absurd to suggest that any of the four factors on which counsel for HFP had relied could, on reconsideration, justify any conclusion of unjust advantage in the future because each of them is an event now long past.
30.	It is common ground that opposition under s.5(3) requires proof of sufficient reputation in the earlier mark, sufficient association with the goods of the applicant and an unfair advantage to the applicant if it is allowed to register the same or a similar mark.  Thus the Hearing Officer had to consider both the strength of the mark and the degree of likely association.  This he did.   In paragraph 57, albeit in the context of the opposition under s.5(2) the Hearing Officer concluded that “the modest inherent qualities of ELLE as a mark had been improved through use by April 2002”.   In paragraph 75, again in connection with the opposition under s.5(2), he concluded that use of the mark on knitting wool and yarn might for some people trigger an association but that any such association would not “amount to more than a bringing to mind”.   I agree with counsel for SIP that both these conclusions were brought forward to the opposition under s.5(3) in paragraph 85 of the Hearing Officer’s decision.
31.	In the light of the further considerations to which the Hearing Officer referred in paragraph 86 to 88 the Hearing Officer concluded in relation to the s.5(3) opposition that any association which might exist “will not be particularly strong”.   I do not see how that conclusion can be invalidated on the basis of any such structural error as that for which counsel of HFP contends.   The submission of counsel skilfully disguises the fact that what he seeks to do is to persuade this court to reach a conclusion on the facts that the degree of association for the purposes of s.5(3) is more than ‘not particularly strong’.  He does so by taking the earlier section of the decision as being the only part which informed the conclusion expressed in paragraph 88.   But it is not.   The earlier section is the starting point from which all the rest flows.  Such flow is both logical and accurate.  I see no reason to conclude that the degree of association was any more than the Hearing Officer found.
32.	Similarly in respect of his conclusion on unfair advantage, it is not suggested that the Hearing Officer misdirected himself as to the relevant legal principles.  I am unable to see why he should have revisited any of the four factors on which counsel for HFP relied in considering this issue.   If the association, with all other relevant considerations, was not strong enough to found any conclusion of unfair advantage and no ground is shown to justify revisiting the facts relied on in relation to association it cannot help to reconsider them in the context of unfair advantage.
33.	The second alleged error in principle in relation to s.5(3) originates in a point not taken before the Hearing Officer and not mentioned in the Appellant’s notice.   Counsel for SIP did not in the end oppose the application of counsel for HFP to amend the appellant’s notice.  I allowed the application because counsel for HFP did not seek to rely on any evidence not before the Hearing Officer.   It does not follow that the fact that the evidence was there can lead to an error in principle on the part of the Hearing Officer if the point which, it is said, the evidence establishes was not then relied on by counsel for the HFP.
34.	The evidence in question is that of Mr Cole, the managing director of SIP, in the witness statement he made on 20th October 2004.  In paragraphs 5, 6 and 7 he dealt with the UK market for yarn and knitting patterns.  He pointed out that 10% of the £100m annual market in yarn was taken by “fashion yarns” which was a specialist market which might have grown since 1997.  It was his view that SIP was the third largest supplier to that market.  But when Mr Cole came to describe knitting and the typical knitter in paragraphs 16 to 18 of his statement he made no separate reference to fashion yarns or the market for or typical user of such products.
35.	There can be no suggestion that the Hearing Officer was ignorant of this evidence.  He accurately summarised paragraphs 5 to 7 of Mr Cole’s witness statement in paragraph 18 of his decision and quoted paragraphs 16 to 18 of Mr Cole’s statement in paragraph 19 of his decision.   There was no evidence ‘in chief’ from any of the witnesses for HFP to suggest that the market for knitting wools or yarn might be divided into two such sections.  Nor was any such possible distinction adverted to in any of the witness statements made by witnesses for HFP in answer to the witness statement of Mr Cole.   There was no suggestion in the written argument of counsel for HFP before the Hearing Officer that the case should be approached in the basis of any such divided or segmented market.
36.	Counsel for HFP now asserts that the Hearing Officer erred in principle.   He contends that the Hearing Officer should have recognised that the market for knitting wool and yarn should be divided between traditional and fashion yarns, that the typical knitter in the market for fashion yarns was quite unlike the profile of the knitter in the traditional market and that such a knitter might well be a fashion conscious reader of Elle Magazine.   The consequence for which he contends is that the association between the mark and products of SIP would be strong thereby leading to the inexorable conclusion that an unfair advantage would be taken if the application for registration was successful.
37.	I do not accept these submissions.  The references by Mr Cole to fashion yarns have to be looked at in the context of the evidence as a whole.  Not only did Mr Cole not draw any distinctions based on the market for fashion yarns nor did anyone else.   As the point was not taken in the grounds of opposition or in the witness statement of any witness for HFP it is not a point which was pursued in any way.   Counsel for HFP does not seek to adduce any further evidence on the point and would face an uphill task in this court if he did.  Accordingly he has to take his stand on the evidence as it is.   In my view it cannot justify any of the inferences counsel for HFP invites me to draw.   The references to fashion yarns were not considered by Mr Cole to justify any qualification to the statements made by him in paragraph 17 of his statement as to the profile of the average knitter.  He was not cross-examined on that statement. Similarly Ms Farr referred (paragraph 6) to SIP as a leading supplier of ‘fashion yarns’ but made no distinction on that account in her description of the average knitter (paragraph 10).  She was not cross-examined either.   Nor was there any evidence adduced on behalf of HFP to justify any such inference.
38.	If this point was ever to have been raised it should have been picked up at the latest by evidence in answer to that of Mr Cole and Ms Farr followed by a suitable amendment to the grounds of opposition.  It is much too late now.  Cf Jones v MBNA International Bank 30th June  2000 (unreported but noted in Civil Procedure Vol 1 para 52.8.2).    The Hearing Officer committed no error in principle in this respect either.

Opposition under s.5(2)

39.	The issues relevant to this ground include (a) whether the clothing for which HFP had registered its mark ELLE is similar to the knitting wool in respect of which SIP seeks to register such mark, and (b) whether such similarity gives rise to a likelihood of confusion on the part of the public.   In paragraph 69 the Hearing Officer determined that issue in the negative but he went on in paragraphs 70 and following to consider the second point on the assumption that there was a sufficient similarity.  On that assumption he determined (paragraph 76) the second issue in the negative too.
40.	Counsel for HFP contends that the Hearing Officer was wrong to describe the first issue as a threshold test.  He suggested that the attribution of that description to Patten J in Intel Corporation v Sihra [2004] ETMR 4 was wrong because it was the editors of Kerly 14th Ed who were responsible for that heresy, see para 9-056.  I do not accept any of these submissions.   In paragraph 12 of his judgment Patten J did refer to the test of similarity as being a threshold test.   I see nothing wrong in that description.  It is common ground that both tests must be satisfied.   In the absence of a sufficient degree of similarity the issue of likelihood of confusion cannot arise.   In the case of sequential issues such as those the first may be described as the threshold to be crossed before consideration of the second.
41.	I have rejected the contention that the market for knitting wools and yarn should be subdivided in connection with the opposition under s.5(3).  It follows that the likelihood of confusion must be assessed on the basis adopted by the Hearing Officer.   Accordingly the contention of counsel for HFP that this issue should be approached on the basis of a likelihood of confusion in a separate market for fashion yarns must be rejected too.
42.	Finally counsel for HFP criticised the decision of the Hearing Officer in that the second sentence in paragraph 76 merely states a conclusion but gives no reasons for it.   I do not agree.  The principal conclusion is that contained in paragraph 75.   Paragraph 76 is an elaboration on it in the light of the two cases there referred to.   I can see no reason in principle or otherwise to disagree.    Nor is it necessary to deal with the contention of counsel for SIP that the Hearing Officer was wrong not to have taken account of the fact that there was no evidence of any actual confusion.

Conclusion

43.	For all these reasons in my judgment the appeal from the conclusions of the Hearing Officer in relation to the opposition under both s.5(2) and 5(3) fails.  Accordingly I dismiss this appeal.
44.	Before parting with this case I wish to comment on the documentation.   I was presented with 10 bundles of documents and another containing the relevant authorities.  I have no criticism of the authorities bundle or of bundle 1.  The latter contained all the relevant documents including the witness statements.  Bundles 2 to 10 reproduced almost all the exhibits to each of the witness statements.   I have not counted them but, in all, they must contain several thousand pages.   In the event I was only referred to five pages and did not find it necessary in either my pre-reading or post-hearing consideration to look for any more.
45.	PD 52 para 5.6(1)(l) and (2), which apply to this appeal, provide that the appeal bundles should only include documents which “the appellant reasonably considers necessary to enable the appeal court to reach its decision” or are “directly relevant to the subject matter of the appeal”, those “extraneous to the issues to be considered on the appeal” being excluded.    PD 52 para 5.6(3) requires the appellant’s solicitor to certify that the appeal bundles comply with that requirement.   In this apppeal there was no certificate from the solicitors for HFP.  I do not know whether this omission is due to ignorance or carelessness on their part or a realisation that such a certificate could not properly be given.   Either way the parties have been saddled with the very considerable copying costs involved (£2,541), there has been a commensurate waste of resources and this court has been burdened with 9 bundles which are quite unnecessary.  Seemingly, the bad old days to which Brooke LJ referred in Scribes West Ltd v Anstalt [2004] EWCA (Civ) 835 at para 11 are not yet past.   
46.	In a letter to me written after the conclusion of the hearing the solicitors for HFP have contended that some documents were omitted from the bundles used before the Hearing Officer and that any more stringent pruning would have cost more than the saving of copying costs.   In addition they submitted that some of the documents included in the bundles, but not referred to at the hearing, were relevant to the wider grounds of appeal raised in the Appellants’ notice and counsel’s skeleton arguments.   The solicitors for SIP responded to the effect that they were not consulted as to the contents of the bundles and saw no reason to question them, when received, as to do so would increase the overall costs.    They made no further copies.
47.	The fact remains that the solicitors for HFP did not do what the Practice Direction requires.   Had they made any attempt critically to review the contents of the bundles and incorporated only those permitted by PD 52 para 5.6(1)(l)  then I would see no reason to disallow any of the copying  costs just because counsel in the exercise of his judgment abandoned some points in favour of concentrating on others.   They do not suggest that that is what happened.   Rather they seem to have chosen to ignore the Practice Direction because it would cost more money to comply with it.    I do not accept that as sufficient justification.    In these circumstances, in addition to dismissing the appeal, I will, subject to any further argument on this point, disallow, as between solicitor and client, £2,300 as the costs of copying bundles 2 to 10 inclusive.   I see no reason also to make an order for the costs of SIP incurred in consequence of having to deal with bundles 2 to 10 to be paid by HFP or its solicitor because they did not protest at the existence of those bundles.   
48.	In summary, therefore, I dismiss this appeal and disallow, as between solicitor and client, £2,300 in respect of the costs of the solicitors for HFP copying documents for the use of the court.