US: Land Rover sues to protect Defender trade mark

I'm sure I could have devised a very clever punning title about protecting "Defender" but I don't fell bright enough just now. The news (from the Law 360 website) is that JLR are suing Bombardier Recreational Products, Inc., in a federal court in Michigan. The Canadian company is making an SUV under its Can-Am brand (isn't that someone else's trade mark? Perhaps from too long ago, and for services rather different from Bombardier's goods) with the model name Defender.

Bombardier's defence appears to turn on abandonment by JLR, which is rather surprising given that they only stopped making their own Defender vehicles earlier this year - and reports from elsewhere indicate that they have in mind to replace it sometime. In the UK (and under EU trade mark law too) the trade mark would remain enforceable until it had not been used for five years, but US trade mark law differs from ours in an important respect (although the two only diverged with the Trade Marks Act 1994 and the Directive on which it is based). Under US trade mark law, what matters is not so much what is on the register as what is being used in commerce, so the arbitrary five-year non-use rule doesn't do it in the States. Whether the trade mark has been abandoned or not is a matter of fact (and, I suppose, law), so if JLR have truly abandoned it they are stuck. But it seems inconceivable that they really have.

Law Commission report on Bills of Sale published

The Law Commission has published its report on bills of sale - of particular interest to the motor trade because of the vexed matter of log book loans.

Commissioner prompts Member States to pursue VW

The EU's Justice Commissioner, Vera Jourova, is pressing national authorities to investigate whether VW breached consumer protection laws - specifically, those based on the  Directive on Unfair Commercial Practices which prohibits misleading advertising, and the  Directive on certain aspects of the sale of consumer goods and associated guarantees - by stressing the green credentials of cars involved in the Dieselgate scandal.

As well as gathering information on action that Member States are taking themselves, the Commissioner wishes to make individual consumers and consumer groups aware of their rights over the claims. A 2013 Report by the Commission (see the Commission's web page on the Directive here) revealed that the Directive was not being enforced as rigorously as it might be by Member States, and the Commission announced its intention of pushing enforcement - the VW affair provides a superb opportunity to advance that agenda.

Italy has already fined VW €5 million over false advertising claims. Action under the Directive could result in more litigation in all 28 Member States of the EU. So far, VW has not compensated European consumers while it has compensated consumers in the USA. It argues (see this report from Automotive News) that by fixing the problem it will have done all it needs to do and there would be nothing left for which to compensate owners. The company also argues that it has not breached the directives (or, more accurately, national laws based on them). The sales directive requires that goods conform to contract - that they are fit for their purpose, which doesn't look like an easy claim to make in this case, that they comply with description (probably a better bet for a claimant) and perform as they should (again, a better bet than unfitness). VW's statement that they are not in breach sounds, well, bullish. As for the unfair commercial practices directive, it prohibits such practices and goes on:

2. A commercial practice shall be unfair if:

(a) it is contrary to the requirements of professional diligence, and

(b) it materially distorts or is likely to materially distort the economic behaviour with regard to the product of the average consumer whom it reaches or to whom it is addressed, or of the average member of the group when a commercial practice is directed to a particular group of consumers.

I wouldn't like to have to argue that claims about VW diesel emissions were not unfair within that definition. But stranger things have happened, and it is unrealistic to think that any manufacturer would admit breaches at this stage. It will only be when cases in Member States' courts start to come up that we will find out whether a breach has really taken place.

See the EU Observer website, this from Automotive News and this article in the Financial Times for more details.

Proposals for reform of tax treatment of termination payments

The government has published a revised proposal, along with draft legislation, to reform the tax treatment of termination payments. This follows a consultation which opened in July last year.
The proposal will not restrict the present tax exemption to termination payments made in a reduundancy situation, as had been suggested. The tax-free threshold will be maintained at the current level (£30,000) and most of the current reliefs will also stay.
Termination payments above the threshold, which will be liable to income tax as at present, will also be liable to employer's National Insurance Contributions.
The draft legislation will retain the distinction between contractual and non-contractual payments, but any payment that the employee would have received had they worked their contractual notice period will be subject to income tax and NICs. All payments in lieu of notice will also be subject to income tax and NICs, regardless of how the settlement agreement characterises the payments.
Reliefs which apply to income tax on payments over £30,000 will be retained, with some modifications.
The result of the changes in the law will be a clash between the legislation and what the contract of employment might say. Employers will, in effect, have to consider what the employee would have been entitled to under the contract had they worked their full contractual notice period - but without regard to the terminationitself, or to any provisions restricting entitlement in the event of a termination.
Interested parties can comment until 5 October: the consultation document is here. The changes will come into operation in April 2018.

Spain: €6 million fine for Nissan price-fixing

Spain's competition authority, la Comisión Nacional de los Mercados y la Competencia (CNMC), has fined Nissan's local distributor, a number of its dealers and two consultancy firms €6.03 million after an investigation into the exchange of commercially sensitive information leading to agreements over discounts and conditions of supply. The consultancy firms monitored the cartel-members' compliance and reviewed the dealers' monthly sales figures.

According to the story on the Law 360 website, the distributor will pay €1.9 million and two of the dealers over €1 million each. I had hoped to provide a link to material on the CNMC's website (www.cnmc.es) but I am unable to find anything relevant - I can order a coffee in Spanish but drilling down into the competition authority's website is another matter altogether. I will ask a friend for help.

Repair clause referred to Court of Justice

Motor Law's great friend David Musker reports on the Class 99 blog that a court in Milan has referred to the Court of Justice (how nice to see the institution being identified by the correct name!) for an interpretation of the repair clause (Article 110 of the EU designs regulation, No 6/2002). The questions asked - of which there are two - are (as is so often the case, partly I suspect as a result of their having been translated into English) pretty incomprehensible. Why do these questions so often have to ask if something is "precluded"? In BMW v Round and Metal, to which the article refers, Arnold J, in a judgment that epitomises the adjective "Arnoldian", rejected the proposition that the defendant's alloy wheels fell within the scope of the repair clause: they were sold not as straight replacements but as alternatives, with different dimensions - and tellingly they were usually supplied in sets of four. What a misfortune to damage all the wheels of your car at once! Although it reminds me of a client who found her Boxster (this was probably 20 years ago) completely devoid of wheels one morning ...

An interesting point in the reference is that it appears to try to establish a connection between the "complex product" (the car) and the replacement part by reference to the fact that the wheels are approved under UNECE Regulation No 124 for use on that particular model of car. I'm looking forward to seeing what the court makes of that. I'm also trying to find some more enticing prospects to look forward to.

Vehicle Sales Code introduced

 Motor Codes has launched a new code of practice, the Vehicle Sales Code. Their press release goes on:

The Code has been added in response to the growing number of enquiries received from car buyers since the arrival of the Consumer Rights Act and Alternative Dispute Resolution (ADR) legislation last October. The Citizens Advice Bureau also reported that, as a category, used cars have represented the second largest volume of complaints from consumers since 2014.
Awarded stage one approval by the Chartered Trading Standards Institute (CTSI), the Vehicle Sales Code provides guidelines on the sale of both new and used cars, as well as the supply of finance and warranties. Consumers can now be protected from the initial purchase of a vehicle, through to servicing and repair, subject to the Codes that a trader is signed up to. Any independent garages or franchise dealers who adhere to the Vehicle Sales Code are voluntarily agreeing to operate to the highest standards during the sale of new and used vehicles and when offering associated products and services. By meeting these guidelines, they are able to display the widely-recognised CTSI-approved Code and Motor Codes logos on their premises and website, thereby giving customers added peace of mind.
The Vehicle Sales Code covers nine different areas. These include the transparent wording of adverts and pricing, clear and transparent invoicing, and the sale of a used car which is supported by a vehicle provenance check to ensure that it has not been stolen, written-off and is free of any outstanding finance payments. It also highlights that retailers should provide test drives, avoid high-pressure selling techniques, supply accurate advice on warranty and finance products, and deliver a vehicle with a full handover, complete with all historic documentation, the entire service history and a valid MOT certificate.
Furthermore, subscribers pledge to resolve any problems quickly and cost effectively should a dispute arise in relation to the sales process. As a last resort, retailers are able to refer a customer to Motor Codes, a CTSI-certified ADR provider, for adjudication prior to the awarding of a final decision.
Bill Fennell, Managing Director of Motor Codes, said: "Following the recent introduction of Consumer Rights and ADR legislation, and the large number of enquiries seen by the Citizens Advice Bureau regarding used cars, it became apparent that there was an inherent need for a Vehicle Sales Code that offered consumers protection when buying a second-hand, or just as importantly, a new car. This gap has been filled, and the Code gives motorists the important reassurance that they are dealing with a trusted and reputable trader. They equally have a body to turn to in the unlikely event that they have a complaint that cannot be resolved directly with the seller."

Environmental Audit Committee critical of government action over emissions

VW faces tougher UK scrutiny as lawmakers call for action, reports Automotive News. The committee's comments can be found here. Because it's part of a much bigger document, here are the relevant paragraphs:

The Committee found that VW is only just beginning to recall cars in the UK. It also heard that the Serious Fraud Office and Competition and Markets Authority have still to determine whether they will take legal action against VW. The Secretary of State for Transport has yet to decide whether there are grounds for legal action— almost a year after the scandal first broke.
Mary Creagh MP said:
"There's been a worrying inertia from Ministers in tackling the VW scandal and they should decide whether to take legal action. They should ask the Vehicle Certification Agency to carry out tests to see whether, without the cheat devices, VW Group cars in the UK would have failed emissions tests."

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