Lifestyle v Frasers: registration of Trade Mark Licences is key

The Court of Appeal’s decision in Lifestyle Equities CV & Anor v Frasers Group Trading Ltd (formerly called Sportsdirect.com Retail Ltd) & Ors [2026] gives much needed clarity on when a trade mark proprietor can recover losses suffered by a licensee (or sub-licensee) in infringement proceedings, and significantly raises the practical importance of registering trade mark licences.

For ease, references in this note to “licences” and “licensees” include sub-licences and sub licensees, reflecting section 28(4) of the Trade Marks Act 1994 (the “Act”) (under which a licence includes a permitted sub-licence) and the Court of Appeal’s confirmation in this case that nothing turns on the fact that the relevant licences are sub-licences.

Background

Lifestyle Equities C.V. (proprietor) and Lifestyle Licensing B.V. (exclusive licensee) own and license a portfolio of trade marks (the “Marks”). The Marks were further sub licensed to a number of entities, but, as a matter of policy, the details of those licences were kept confidential and were not recorded on the UK Trade Marks Register, save for the Harvest Group UK Ltd licence.

Following findings of trade mark infringement in 2018, an inquiry as to damages was ordered. In that inquiry, Lifestyle sought to recover not only its own losses, but also losses allegedly suffered by (mostly unnamed) sub-licensees, relying on section 30(6) of the Act.

Marcus Smith J refused the defendants’ application for summary judgment, holding that the proprietor could rely on section 30(6) regardless of registration, and that late registration could still unlock the ability to recover damages in respect of the losses of licensees. The Court of Appeal has now overturned that decision.

The Court of Appeal’s decision

The key issue was whether a trade mark proprietor can, under section 30(6) of the Act, recover losses suffered by unregistered licensees, and whether late registration can revive those rights.

The Court of Appeal held:

• Section 30(6) is a protection for licensees: it allows a proprietor, in infringement proceedings, to recover an amount reflecting licensees’ losses and to hold such proceeds on their behalf. That is a benefit for licensees, not an additional proprietary right for the trade mark owner.
• Section 25(3)(b) bites on section 30(6): until an application is made to register a registrable transaction, “a person claiming to be a licensee … does not have the protection of section 30 or 31”. A proprietor therefore cannot invoke section 30(6) in respect of an unregistered licence.
• Limitation Acts still apply: although there is no statutory deadline for registration, an application must be made before expiry of the limitation period for any claim in respect of the licensee’s losses. The limitation period still runs from the act of infringement, not the date the licence was registered to recover the licensee’s loss. Registering after time has run cannot save the claim.

On the facts, the last infringing act occurred on 30 June 2016, licensee losses were first claimed in June 2023, and the relevant licences were unregistered or, in the case of the Harvest licence, only registered in April 2025. The Court held that the claims for the licensee’s losses were out of time and granted summary judgment dismissing those parts of the claim.

Practice points – entering into and managing trade mark licences

The judgment has practical implications for brand owners and licensees.

1. Register licences if you may ever want to recover licensee losses

• Registration is still technically voluntary, but failure to register now has a consequence. The protections under sections 30 and 31, including recovery of licensee losses, are not available for unregistered licences. However, it does not make registration a precondition for a proprietor to obtain an injunction to restrain infringement. That core remedy remains available even if licences are unregistered.
• Best practice is to:
  • apply to register within six months of the licence (to preserve entitlement to costs under section 25(4)); and
  • in any event, ensure registration occurs before the six year limitation period expires for infringements in respect of which you may wish to claim losses incurred by a licensee.

2. Rethink confidentiality vs registration

• Lifestyle’s deliberate choice not to register most sub-licences (to keep them confidential) ultimately precluded recovery of alleged sub licensee losses.
• Businesses with layered or global sub licensing structures should reassess whether confidentiality concerns justify non registration, given the litigation downside. Consider whether key, high value licences should always be registered, and seek advice on how best to manage confidentiality in the registration process, including through appropriate redaction or registering short form details.

3. Plan enforcement strategy in the licence itself

• Non-exclusive licensees do not benefit from the statutory mechanism in section 30(2)-(3) that allows an exclusive licensee to call on the proprietor to bring infringement proceedings and, if the proprietor does not act, to sue in its own name. When negotiating non-exclusive licences, consider including contractual rights for the licensee to: (i) require the proprietor to bring infringement proceedings; (ii) bring proceedings itself if the proprietor does not act (by expressly giving consent in the licence, consistent with section 30(1A)); and (iii) provisions allocating between proprietor and licensee any damages or sums recovered by way of an inquiry as to damages or an account of profits.
• For exclusive licences, consider whether they should be drafted as qualifying exclusive licences, i.e. licences which provide that the licensee has the same rights and remedies as the proprietor, so that the licensee is a “qualifying exclusive licensee” with rights to sue in its own name (and concurrently with the proprietor) under section 31.

4. Get the pleading and timing right – avoid “black hole” loss

The Court recognised the risk of a “black hole” where the true economic harm sits with licensees who cannot sue, while the proprietor has standing, but has suffered only limited loss. Section 30(6) is designed to address that but only where licences are registered and claims are in time.

From a litigation perspective:

• Treat recovery of licensee losses as a separate head of claim, not something that can safely be left to be articulated late in the process.
• At the outset of any infringement claim, identify:
  • all relevant licences and sub-licences;
  • their registration status; and
  • whether the limitation period may already have expired for licensee loss claims.
• Where appropriate, move quickly to register licences and amend pleadings, ensuring this is done before the limitation period expires.

5. Portfolio and process implications

The decision underlines that trade mark licensing is as much about portfolio management and governance, as it is about deal-making:

• Build licence registration and diarising of key dates into standard workflows for brand management and IP operations.
• Periodically audit existing licences to identify those that are unregistered but economically important, and assess whether registration could still add value for future enforcement.
• Align internal playbooks across legal, commercial and brand teams so that confidentiality, competition, tax and litigation factors are weighed together, when deciding whether to register a licence.

Looking ahead

Lifestyle Equities v Frasers Group reinforces that trade mark licensing is not only a commercial exercise but also a litigation-planning exercise. The decision links the voluntary registration regime to substantive remedies in a way that makes registration, in practice, hard to ignore for trade mark proprietors. Brand owners and licensees should review their existing trade mark licensing arrangements and registration status, and update template agreements and internal processes to align with this decision.

Authored by Joel Smith and Charlotte Chan.