Takeaway owner loses trade mark battle with Tesla car giant

Mr Ali is the owner of the Colorado Chicken takeaway store located in Bury. In May 2020, he registered the trade mark "Tesla Chicken & Pizza" with the UK IPO in Class 43 for food and drink services.

Car giant Tesla sought to extend the protection of the TESLA name to the UK in 2021, also covering class 43 services; Mr Ali opposed Tesla's application on the basis of the likelihood of confusion with his earlier registration.

Tesla filed a counterstatement denying the grounds of the opposition and applied to invalidate Mr Ali's trade mark registration on the grounds that Mr Ali sought to ride on the coat-tails, reputation, and fame of the TESLA name or to block its entry into the market, and ultimately to unfairly extract financial consideration for handing the trade mark over.

Tesla claimed that in communications between the parties following Mr Ali's oppositions, Mr Ali offered to sell his trade mark for a very large sum of money, which Mr Ali refuted and claimed was a misunderstanding by his solicitor.

Tesla's attempt to argue that it had "goodwill" in the food and drinks field as a result of a tweet by Elon Musk in January 2018 stating Tesla's intention to open a drive-in restaurant under the TESLA name was branded "hopeless" by the UKIPO Hearing Officer (HO). The HO pointed out that "there is no basis in law for Tesla's submission that Mr Musk's tweet created a protectable 'anticipatory' goodwill in a prospective restaurant business in the UK". Nevertheless, the HO held that "it would make obvious commercial sense to provide services supplying food and drink at, or around, recharging locations so that users can take refreshments whilst waiting for their electric cars to recharge". As such, it was held that it would not be surprising if consumers assumed that services (offered under the name of a well-known provider of electric cars) providing food/drink in the vicinity of an electric car recharging station were connected with the car maker.

The invalidation action succeeded on all grounds, including bad faith; Mr Ali's trade mark was cancelled, and he was ordered to pay Tesla's costs. 

This case highlights another big brand battle with a small business and is a reminder of the complex world of trade mark law!

If you have any questions regarding trade marks, you can speak to our Trade Mark team by contacting us at mail@stratagemipm.co.uk.