Court Rejects Trademark Infringement Claim in One P Ltd v Chantelle Camilleri Psaila: What This Decision Means for Maltese Businesses

One P Ltd, operator of a well-known restaurant “The Avenue”, holds several registered trademarks containing “THE AVENUE” and “AVENUE”. The defendant, Chantelle Camilleri Psaila, runs a small home-based business selling homemade frozen food under the name “Bake Avenue – Homemade Goods by Chantelle” and related variations.  

One P Ltd sought interim measures to prohibit the defendant from using the sign “Bake Avenue”, alleging trademark infringement due to a likelihood of confusion, and unfair advantage.

1. Similarity of the marks

The Court observed that although both signs share the word “Avenue”, this element alone was not sufficient to establish confusion:  

• visual similarity existed only at a moderate level when the defendant used the sign “Bake Avenue” on its own, but this similarity was significantly reduced when additional descriptors such as “Homemade Goods by Chantelle” were included.  
• Phonetically, the marks shared some similarity due to the identical pronunciation of the word “Avenue”, yet this was not enough to outweigh the broader contextual differences.  
• Conceptually, any similarity weakened considerably once the descriptive elements used by the defendant were taken into account, as these clarified the nature and scale of her home‑based business.
• “Avenue” is a common English word, making it inherently more difficult for the claimant to claim strong distinctiveness or exclusive rights over it in a trademark context.
• The trademarks operated in entirely different market segments. Whereas the applicant’s trademark is registered as a full-service restaurant, the defendant’s mark is registered as a home-based seller of frozen homemade food. Such differences in the nature of the goods and services, further reduced any risk of similarity.

2. Likelihood of Confusion

The Court concluded that, given the substantial differences between the parties’ commercial activities, the average consumer would be highly unlikely to confuse the two signs or assume any form of economic connection between them. The businesses operated in entirely different segments, one being an established restaurant and the other a small home‑based supplier of frozen homemade goods, resulting in distinct consumer expectations, marketing channels, and purchasing contexts. These differences significantly reduced any realistic possibility of confusion.

3. Reputation and Unfair Advantage

Although The Avenue enjoys a solid and well‑documented reputation in Malta, the Court held that this reputation did not translate into an enforceable claim against the defendant under Article 12(4)(c). It found no meaningful link in the minds of consumers between a well‑known restaurant brand and a home‑based frozen food business, making it implausible that customers would associate one with the other.  

Furthermore, there was no evidence of free‑riding, as the defendant operated a non‑competing, small‑scale business whose branding was largely descriptive and personal in nature. The shared word “Avenue” was also deemed a common English term, far too generic to support a claim that the defendant was exploiting the claimant’s reputation.

4. Proportionality & Due Cause

The Court’s approach to proportionality and legitimate use was addressed with the following reasoning:

• Emphasis on Proportionality: The Court underscored that enforcing trademark rights should be balanced, ensuring that such enforcement does not become an unjustified obstacle to legitimate commercial activities.
• Assessment of Injunctive Relief: It was held that issuing an injunction to close down a micro‑enterprise, particularly one operated from the defendant’s home, would be a disproportionate response compared to the alleged harm suffered by the claimant.
• Legitimate Descriptive Use: The Court recognised that the defendant’s use of the sign “Bake Avenue” served a legitimate descriptive function, as it transparently indicated that the products were homemade and personally prepared by the defendant.

Guidance for Trademark Owners

The judgment provides valuable direction for trademark owners seeking to enforce their rights in Malta. It encourages a strategic approach that prioritizes context and proportionality when evaluating potential infringements, especially in cases involving terms that are generic or descriptive in nature. Trademark owners should consider:  

• Assessing the degree of distinctiveness before pursuing enforcement.
• Considering the market context, including the nature of goods and services and the relevant consumer base.
• Recognising that common or descriptive wording generally attracts narrower trademark protection.
• Weighing the principle of proportionality to avoid taking excessive legal measures that could be deemed unjustified.

Considerations for SMEs and Micro-Businesses

Small and micro-businesses benefit from the ruling’s affirmation of their right to use descriptive branding, provided it is adopted in good faith and transparently communicates the nature and origin of their goods. The Court acknowledged that such businesses should not be unduly restricted by overly aggressive trademark enforcement. Small business can take practical steps in their branding such as:  

• Including clarifying elements in their branding to signal the nature and origin of goods.
• Adopting branding practices in good faith to ensure defensibility against trademark claims.

Wider Impact on Malta’s Commercial Landscape

The decision sets a precedent that supports a balanced commercial environment in Malta, where both established brands and emerging businesses can operate fairly. It reinforces the importance of safeguarding market participation for all players, while upholding the integrity of trademark protections by:  

• Promoting fair competition and discouraging anti-competitive enforcement tactics.
• Encouraging brand owners to act responsibly and proportionately in legal disputes.
• Supporting innovation and market entry for new and small-scale businesses.

Our intellectual property team advises on the registration, protection, and enforcement of trademarks in Malta and across the European Union. We assist rights holders at every stage of the enforcement process, from the early identification and assessment of potential infringements to the implementation of effective legal remedies.