Balancing Free Speech and Fair Competition: How Section 12(3) HRA Applies to Threats

Bargain Busting Ltd v Shenzhen SKE Technology Co Ltd & Ors [2025] EWHC 1239 (Ch)

Summary

This judgment concerns an application by the first Defendant for an interim injunction to restrain the Claimant from making threats of proceedings for trade mark infringement to third-party distributors of its vaping products.

The central issue is whether, within the statutory framework of unjustified threats under Sections 21 to 21F Trade Marks Act 1994 ("TMA"), the test for granting an interim injunction engages a higher merits threshold triggered by the right to freedom of expression under Section 12(3) Human Rights Act 1998 ("HRA") than the usual American Cyanamid test.

The Facts

The Claimant, hereinafter ("BB"), is the owner of various registered trade marks, and a trade mark application, containing the word "crystal".

BB commenced proceedings in September 2024 against the first and second Defendants, a Chinese manufacturer of e-cigarettes and vaping devices and its UK trading subsidiary respectively (collectively ("SKE")). SKE markets products which include the word "crystal".

In December 2024, BB sent letters to eleven distributors and retailers of SKE's products, stating that their acts would amount to trade mark infringement and proceedings would be brought unless an undertaking was given to cease distributing or selling the allegedly offending SKE goods.

In March 2025, BB applied to join only four out of the eleven recipients of the letters into this action. They became the third to sixth Defendants by a consent order.

SKE counterclaimed, challenging BB's marks for bad faith and non-use, and sought an interim injunction to stop BB from making further unjustified threats to disrupt its sales.

The Threshold Issue

The central issue was whether SKE had shown a strong enough prospect of success at trial to justify an interim injunction. The parties agreed this issued turned on whether there was a serious argument that BB's marks were invalid.

BB argued that an injunction would interfere with its rights under Article 10 European Convention on Human Rights ("ECHR") (the right to freedom of expression), as, inter alia, it would prevent BB from informing potential defendants about alleged infringement.

Consequently, BB argued that Section 12(3) HRA (which incorporates the right to freedom of expression under Article 10 ECHR) applied. Following guidance in Cream Holdings v Banerjee [2004] UKHL 44 ("Cream Holdings"), for SKE's request for an interim injunction to be granted this would normally require SKE to show it was more likely than not to succeed at trial; a higher threshold than the usual American Cyanamid test of a serious issue to be tried.

BB relied on an analogy in prior case law concerning comparative advertising in which the more likely than not general approach in Cream Holdings applied to communications made with a view to protecting a party's commercial interests.

While BB accepted there was a serious issue under the American Cyanamid threshold, it argued that SKE had not met the higher standard required under Section 12(3) HRA.

The Court's Analysis

The Court found that a higher merits threshold under Section 12(3) HRA did not apply to unjustified threats. Parliament had already balanced freedom of expression and commercial fairness when amending Section 21 TMA via the 2017 Unjustified Threats Act, following extensive consultation. Requiring applicants to prove that they would probably win at trial would undermine statutory protection and place too high a barrier for urgent relief.

The Judge concluded that unjustified threats will often fall within the exceptional category of cases identified by Lord Nicholls in Cream Holdings and stated that the likelihood test in Section 12 HRA should be applied flexibly.

Furthermore, comparative advertising was not found to be a suitable analogy, as it typically does not involve trade mark infringement, whereas the unjustified threats regime addresses misuse of litigation threats to clear the route to market.

Conclusion

The standard American Cyanamid approach applied, and the Court granted an interim injunction restraining BB from issuing further threats to SKE's distributors or retailers pending trial. The decision confirms that the constraints under Section 12 HRA do not override the specific statutory framework governing trade mark threats. This serves as a clear warning to IP holders: before threatening proceedings, ensure that infringement claims are well-founded.

The judgment can be accessed here.