Hotel Cipriani SRL and Others v Cipriani (Grosvenor Street) Ltd and Others
|England & Wales
|THE HON MR JUSTICE ARNOLD,MR JUSTICE ARNOLD
|02 March 2010
| EWHC 628 (Ch), EWHC 3032 (Ch)
|TLC/396/09,Case No: HC06C04119
|02 March 2010
 EWHC 3032 (Ch)
The Hon Mr Justice Arnold
Case No: HC06C04119
IN THE HIGH COURT OF JUSTICE
Royal Courts of Justice
Strand, London, WC2A 2LL
Iain Purvis QC, Benet Brandreth and Tom Alkin (instructed by Walker Morris) for the Claimants
James Mellor QC and Charlotte May (instructed by CMS Cameron McKenna LLP) for the Defendants
Hearing dates: 28–31 October, 3–7 November 2008
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
The First Claimant (“HC”) owns and operates the Hotel Cipriani in Venice. The Second Claimant owns and operates the Ristorante Hotel Cipriani at the Lapa Palace Hotel in Lisbon. The Third Claimant owns and operates the Ristorante Villa Cipriani at the Reid's Palace Hotel in Madeira. All three Claimants are members of the Orient Express Hotels Group of companies (“OEHG”), which was formerly part of the Sea Containers group.
The First Defendant (“CGS”) has since April 2004 operated a restaurant the correct name of which is said by the Defendants to be Cipriani London, but which is commonly referred to simply as Cipriani (“the Restaurant”). The Second Defendant (who I shall refer to for brevity as “Giuseppe”) is the sole director of CGS. The Third Defendant (“CI”) is a Luxembourg corporation which has licensed CGS to use the name Cipriani. Both Giuseppe and his father Arrigo Cipriani (who I shall refer to for brevity as “Arrigo”) are directors of CI, and Arrigo is the Chairman. CI in turn is licensed by Altunis Trading Gestao E Services LDA (“Altunis”), a Madeiran company.
CGS, CI and Altunis are part of what the Defendants call the Cipriani Group of companies, although it is not clear whether this appellation had been used prior to the present dispute. The structure of the Cipriani Group is somewhat complicated. For present purposes it suffices to say that, directly or indirectly, CI wholly owns Altunis and a number of other companies, including Cipriani SpA, Cipriani Industria Srl, Cipriani International Group SA and Cipriani USA, Inc (as to each of which, see below), and owns 60% of CGS.
The Cipriani Group is ultimately owned and controlled by Arrigo, Giuseppe and Giuseppe's two sisters. Arrigo oversees the Group's Italian businesses, while Giuseppe has prime responsibility for its businesses outside Italy and in particular in the USA. Nevertheless, Arrigo is active in the management of the business as a whole, including the Restaurant. Thus until recently he has visited London to oversee the running of the Restaurant for about a week at a time approximately once a month.
There is a historical link between the Claimants on the one hand and the Cipriani family, and hence the Cipriani Group, on the other hand. As described in more detail below, one of the founders of HC was Arrigo's father and Giuseppe's grandfather, also called Giuseppe Cipriani (who I shall refer to as “Giuseppe Senior”). The Cipriani family has long since ceased to have any connection with HC, however.
I have already said enough to indicate the nature of the present dispute, which concerns a clash between the respective trade mark rights, or perceived trade mark rights, of the Claimants and of the Defendants. The Claimants allege that CGS has infringed a Community trade mark owned by HC and is liable both for passing off and under section 56 of the Trade Marks Act 1994. CGS denies infringement, passing off and liability under section 56 and counterclaims for a declaration that both the Community trade mark and a United Kingdom trade mark owned by HC are invalid. It is common ground that, if CGS is liable, Giuseppe and CI are also liable as joint tortfeasors.
The name Cipriani
As will be apparent from the foregoing, Cipriani is an Italian surname. There is no evidence before me, however, as to how common it is in Italy, let alone in the United Kingdom. Nor is there is any direct evidence as to whether, at the dates which are material to this dispute, consumers of hotel and restaurant services in the United Kingdom appreciated that Cipriani was an Italian surname. My assessment is that many consumers would have been aware of this, but far from all. (For reasons unconnected with this case, a greater proportion would be aware of this now.)
HC's Community trade marks
HC is the registered proprietor of Community Trade Mark No. 115824 (“the CTM”) for the word CIPRIANI in respect of various goods and services including the following:
“Hotels, hotel reservation, restaurants, cafeterias, public eating places, bars, catering; delivery of drinks and beverages for immediate consumption.”
The application for the CTM was filed on 1 April 1996, the first day on which the Office Harmonisation of the Internal Market (Trade Marks and Designs) (“OHIM”) accepted applications. The CTM was registered on 9 July 1998. At that time the services set out above were classified in Class 42 of the 7 th edition of the International Classification established under the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Trade Marks. With effect from 1 January 2002 such services were re-classified in Class 43 of the 8 th edition of the Nice Classification. In the current 9 th edition they continue to be classified in Class 43. The re-classification does not affect any of the issues that I have to decide. Indeed, the entry for the CTM in the OHIM database continues to show the services as being in Class 42, presumably so as to reflect the position as at the application date.
HC is also the proprietor of Community Trade Mark No. 115857 for the words HOTEL CIPRIANI applied for and registered on the same dates and in respect of the same goods and services as the CTM. The Claimants do not allege that this registration has been infringed, nor do the Defendants attack its validity.
HC's United Kingdom trade marks
HC is the registered proprietor of United Kingdom Trade Mark No. 2435200 (“the UKTM”) for the word CIPRIANI registered as of 11 October 2006 in respect of an almost identical specification of goods and services to the CTM. The Claimants do not allege that this registration has been infringed, but as stated above the Defendants claim that it is invalid.
HC is also the proprietor of United Kingdom Trade Mark No. 1343293 for the words HOTEL CIPRIANI registered as of 3 May 1988 in respect of “hotel reservation services included in Class 42”. The Claimants do not allege that this registration has been infringed, nor do the Defendants attack its validity.
There is quite a complicated factual background to the present dispute. Although much of this is common ground, some is disputed. I will set out my findings of fact topic by topic and approximately chronologically in relation to each topic.
Before doing so, I must say something about the witnesses. I heard from a total of eight witnesses called by the Claimants. In addition, a statement from a ninth witness was not challenged by the Defendants. It is not necessary to list all of these witnesses, some of whom are referred to below. Counsel for the Defendants did not criticise any of them, but pointed out that there were certain differences between what some of the witnesses had said in their witness statements and the evidence they gave during cross-examination. I heard from three witnesses called by the Defendants. In addition, statements from three more witnesses were not challenged by the Claimants. Counsel for the Claimants made two submissions about the Defendants' witnesses which I must deal with.
First, he submitted that Arrigo was a very unsatisfactory witness who had lied about at least one matter and whose evidence could not be accepted on any subject unless it was corroborated by independent evidence. I am not persuaded that Arrigo was deliberately untruthful in his evidence. Nevertheless, I consider that he was not a reliable witness. This is partly due to the general manner in which he answered questions during cross-examination: his answers tended to ramble and at a number of points were inconsistent. More specifically, I was concerned by the following points:
i) On 30 July 2007 Arrigo, Giuseppe, Cipriani Fifth Avenue, LLC, Downtown Restaurant Company, LLC and GC Alpha, LLC entered into a plea agreement with the District Attorney of the County of New York under which Arrigo, Giuseppe and the companies agreed to plead guilty to tax offences. In the case of Arrigo he agreed to plead guilty to one count of a violation of Tax Law §1805(b), False Returns or Reports; Corporate Taxes, a class E felony. In return the District Attorney agreed to recommend to the Court that he be sentenced to five years' probation and (jointly and severally with the other defendants) to pay $10 million in satisfaction of New York State and New York City tax obligations through tax year 2004 and the cost of prosecution. The agreement provided that at the time of the plea Arrigo would admit under oath the following facts:
“I am an owner and corporate officer of Cipriani International, S.A. ('Cipriani SA'), a foreign holding corporation formed under the laws of Luxembourg. Cipriani S.A. in turn wholly owns Cipriani USA, Inc. ('Cipriani USA') a Delaware corporation with its principal office at 110 East 42 nd Street, New York, New York. Cipriani USA owns numerous subsidiaries which operate various restaurants, banquet halls and real estate venues...
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