The High Court has ordered an account of the profits attributable to Brennan Bakeries’ use of packaging that unintentionally passed off its sliced brown bread as McCambridge’s. The court set aside up to three hours for the account at a nearby sitting of the Commercial List.
The order does not award McCambridge all profits from the bread sales. It requires the court to determine what profits resulted from the offending packaging. Mr Justice Peter Charleton said profits should be apportioned, using a broad assessment of factors including sales before and after the packaging change and the likelihood of customer confusion.
The issue arose after McCambridge elected to seek an account of profits rather than damages. The parties disputed whether Brennan Bakeries should account for all profits from bread sold in the similar packaging, or only the portion attributable to the passing off. The High Court had been asked to resolve that question following an earlier finding of passing off; the present judgment sets the approach for the account, rather than fixing a final amount.
Brennan Bakeries had sold its wholewheat bread in different packaging before introducing new packaging in January 2011. The rollout began in some locations in Dublin and Cork and was completed nationwide by April. McCambridge warned the company in March 2011 and began proceedings later that month. Peart J found for McCambridge in November 2011 and made an order restraining Brennan Bakeries from passing off its bread and using confusingly similar packaging. The Supreme Court upheld the finding in July 2012, with Fennelly J dissenting.
The judgment records that Brennan Bakeries’ monthly sales rose from 30,000 units to 40,000 during the infringement, then fell to 37,000 when plain packaging was used. It also refers to profits of €608,481 from sales in the offending packaging between January 2011 and August 2012. Those figures were discussed as relevant to the account; the court did not order that the entire sum be paid to McCambridge.
Mr Justice Charleton said an account of profits is an equitable remedy intended to remove gains attributable to the wrong, not punish a defendant. He noted that Brennan Bakeries’ bread was already on the market and earning profits before the packaging change, and that the earlier court had found the passing off unintentional. Those circumstances supported an assessment of the portion linked to the infringement rather than an undifferentiated award of all profits.