The High Court recently exercised new powers to compel mediation in a trade mark dispute between Superdry and Manchester City Football Club (DKH Retail Ltd & others v City Football Group Ltd [2024] EWHC 3231 (Ch)).
Superdry, represented by Fox Williams, brought an action for trade mark infringement due to Manchester City’s use of “SUPER” and “DRY” on training kits as part of a sponsorship with the beer brand Asahi Super Dry 0.0%. Superdry claimed that the use of “SUPER” and “DRY” on clothing could cause customer confusion with the “SUPERDRY” brand.
Superdry invited Manchester City to mediate the dispute. When that invitation was not accepted, Superdry instead successfully applied for a compulsory mediation order – a power now explicitly available to courts following recent CPR amendments.
Legal impact of court ordered mediation in IP disputes
This ruling marks the first reported application of the new powers to order ADR following the Court of Appeal’s landmark decision in Churchill v Merthyr Tydfil County Borough Council [2023], where Sir Geoffrey Vos established that courts can order parties to engage in non-court dispute resolution if:
- It doesn’t impair the right to a fair trial.
- It pursues a legitimate aim.
- It’s proportionate to achieving that aim.
The October 2024 CPR amendments codified this approach, giving courts explicit powers to order ADR participation.
Superdry and Manchester City: the Court’s decision
Manchester City had resisted the application for court-ordered mediation on the grounds that the parties’ positions meant mediation could not succeed. However, Mr Justice Miles granted Superdry’s application, emphasising that:
- Mediation can crack “even the hardest nuts“.
- The parties’ positions were fully crystallised through pleadings.
- Mediation offers flexible, creative commercial outcomes.
- The process can overcome entrenched resistance to negotiation.
- A brief mediation wouldn’t disrupt trial preparations.
Notably, following the mediation, the parties settled the dispute before trial.
Practical takeaways for businesses and legal teams
- Mandatory mediation is a reality: Courts now have clear authority to order unwilling parties into mediation and are using this power.
- Timing isn’t a barrier: even late-stage applications may succeed, with the court recognising that crystallised positions can sometimes aid settlement.
- Commercial solutions: mediation can provide creative outcomes beyond binary court judgments.
- Cost benefits: avoiding substantial trial costs and managing the court’s resources through focused mediation efforts remains a persuasive factor.
- Proven success: this dispute ultimately settled after ordered mediation, supporting the judge’s view that mediation can succeed even with seemingly intractable positions.
- Strategic implications: parties should carefully consider their approach to mediation, as courts may order participation regardless of objections.
This case demonstrates that even in complex IP disputes between commercial entities with seemingly irreconcilable positions, the UK courts now expect genuine exploration of mediated settlements and will force unwilling parties to do so. As this approach develops, we anticipate that mediation will become more common, whether by agreement or by order, and the success rate of mediation suggests that, as a result, fewer disputes will ultimately proceed to trial.
Intellectual property lawyers
If you have any questions about these issues in relation to your own organisation, please contact a member of the intellectual property team or speak to your usual Fox Williams contact.
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