Case Review of Interflora II
Interflora II is the latest UK Court of Appeal decision in the on-going clash between Interflora and Marks & Spencer – Interflora Inc v Marks & Spencer PLC ( EWCA Civ 319, April 5 2013) relating to the use of Adwords in Internet search results. The latest decision repeats the conditions that market survey evidence must meet to be admissible in court.
In A Nutshell: What Does Interflora II Tell Us?
- (i) A judge should not allow survey evidence unless the evidence is likely to be of REAL value and the likely value of the evidence justifies the cost.
- (ii) Make applications to request permission for survey evidence in good time before trial.
- (iii) Don’t ask witnesses leading questions as they can undermine the reliability of the survey and the resulting witness evidence.
- (iv) Don’t overly “lawyer” witness statements. A witness statement must, if practicable, be in the witness’s own words.
- (v) It is not enough to simply show that survey evidence might be of some value or more than minimal value, a Judge must limit or exclude technically admissible evidence which is not of real value.
The Original Dispute
Interflora is a flower delivery network and Marks & Spencer (“M&S”) is a chain retailer that provides a flower delivery services via its website. On searching ‘interflora’ (or a slight mis-spelling) an advert for the M&S flower delivery service was produced as a sponsored link at the top of the Google ‘hits’ list. Interflora applied for an interim injunction to stop M&S using the word ‘Interflora’ (as well as the mis-spellings ‘Intaflora’ and ‘Inter-flora’) as a sponsored Google keyword search term on the basis that such use was trade mark infringement. In support of their request for the interim injunction, Interflora sought to present evidence showing actual confusion gathered from market surveys. The Interflora I and Interflora II decisions represent the struggle between the parties to determine whether this survey evidence should be allowed into the court proceedings.
Arnold J at first instance allowed Interflora to use evidence of witnesses identified by two surveys even though Interflora did not intend to rely on the surveys themselves. Arnold J said that the fact that the witnesses had been respondents to a survey was admissible even though the survey itself was not and even though the questions posed in the survey were flawed. M&S appealed this decision and argued that the court should not allow evidence from witnesses selected as a result of a survey unless the survey itself was statistically reliable.
The Court of Appeal (Interflora Inc v Marks & Spencer PLC ( EWCA Civ 1501, November 20 2012) overturned Arnold J’s decision and concluded that Interflora Inc was not allowed to use the evidence from witnesses identified in the survey. The Court of Appeal stated that evidence should be controlled to ensure that it would be of “real utility” and that “the likely utility of the evidence justifies the costs involved”. However, the Court of Appeal did qualify its decision by saying that different considerations may be relevant, for example if the evidence in question consists of the “spontaneous reactions of members of the public to the allegedly infringing sign or advertisement”.
Following the decision in Interflora I, Interflora responded by requesting permission to call evidence from witnesses who, they claimed, gave evidence of confusion in the real world. Arnold J (again) granted permission. M&S (again) successfully appealed the decision. Arnold J’s decision was overturned on the basis that his analysis of Interflora’s submissions were flawed.
Interflora made a list of over 100,000 people who had either bought flowers through Interflora’s website or who had participated in a previous survey. From that pool of over 100,000 people, Interflora found 13 people who, they said, gave evidence of real world confusion. Interflora argued the evidence of these 13 people supported their argument that the use of words such as “M&S Flowers” in an advert displayed as a sponsored link following a Google search for “Interflora” was insufficient to enable a reasonably well-informed and observant internet user to tell that the flower-delivery service offered by M&S did not originate from Interflora.
Arnold J allowed Interflora to use the witness evidence because he considered the evidence was of “some value in assisting the court”. He did not think that the evidence was “likely to be decisive, but nor [did] it appear of little or no value”. M&S appealed this decision. The appeal focused on the selection of witnesses and the questions used to select those witnesses.
The witness statements of the Interflora pool were drafted following calls from solicitors for Interflora who questioned the participants according to a script. The questions asked by the solicitors and at issue were:
- What did you think when you saw M&S when you entered the search term INTERFLORA?
- Why do you say that?
- (And, if no connection between Interflora and M&S was given in the previous answers) “From your memory of these search results, what, if anything, do you think the results tell you about the relationship between Interflora and M&S?”
The Court compared the actual answers to the questions with the corresponding parts of the witness statements which had been prepared by the solicitors. The Court found that the witness statements “[painted] a rather different picture to that given by the raw answers to the questions. The way the witness statements paint the picture is more favourable to Interflora’s case… They exclude key statements that some of the witnesses saw no connection between Interflora and M&S; and recognised that they were competitors. I do not consider that the witness statements are a fair reflection of the raw data”. The Court considered question 3 above to be a ‘leading question’ because it led witnesses to speculate about something that they had not thought about before. After reviewing the raw data the Court concluded that the vast majority of the witness evidence was not admissible. The Court found that only 4 of the 13 witnesses that Interflora wanted to rely on (who had been taken from the pool of over 100,000) could be used.
The Court said that the problem was that the evidence of the 13 witnesses was not representative of the range of responses to the questions. Furthermore, the evidence was not truly reflective of the results of the survey because there were 24 other interviewees who had no difficulty in separating M&S from Interflora. Interflora even acknowledged that fact by disclosing the answers of the 24 interviewees who thought that there was no connection between Interflora and M&S. Arnold J at first instance dismissed M&S’s argument on this point on the basis that Interflora had provided the contact details of these 24 witnesses and M&S could have taken their own statements from these 24 witnesses had they wished to do so. On Appeal the Court found that the providing of contact details was an “inadequate ground” for dismissing the complaint. The Court said that allowing this type of evidence placed an “undue and unfair burden on the other party” because the other party (i.e. the party that didn’t actually do the survey) had the burden of producing a selection of witnesses that demonstrated the full range of answers to the questions. The Court said that Arnold J, in permitting the evidence, had placed the burden on the defendant to disprove the validity of the selection, rather than on the claimant to validate it. As a result the Court of Appeal overturned Arnold J’s decision on the basis that his analysis of the application was flawed.
Lord Justice Lewison stated:
“With the benefit of hindsight, perhaps I did not make my message clear enough in Interflora 1. Let me say it again, but more loudly. A judge should not let in evidence of this kind unless the party seeking to call that evidence satisfies him (a) that it is likely to be of REAL value; and (b) that the likely value of the evidence justifies the cost.”
The Court stated that “an application to adduce this kind of evidence should be made as early in the case as possible”.
Sir Robin Jacob stated that “nothing of value could come out of the proposed evidence. Eight of the thirteen proposed witnesses had been exposed to the obviously unfair question . The value of their evidence thereafter was obviously nil”. He did, however, state that he did not think that the days of survey evidence were over. He said that he thought it possible to conduct fair surveys and that they may lead to witnesses of value, however, if the survey amounted to no more than “scratching around for something” then there would be “every good reason” to exclude it along with any resultant witnesses.
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Interflora Inc v Marks & Spencer PLC ( EWCA Civ 1501, November 20 2012)
This article is for general information only. Its content is not a statement of the law on any subject and does not constitute advice. Please contact Reddie & Grose LLP for advice before taking before any action in reliance on it.