Trade Mark Infringement & Defences

Video overview by Nicolas Suzor on the trademark infringement framework.

Exclusive Rights Granted Upon Registration

Registration gives the registered owner the exclusive right to use the trade mark or authorise another person to use the trade mark in relation to the goods or services in which it is registered (TMA s 20(1)). The trade mark owner also has the right to obtain relief if the trade mark has been infringed (TMA s 20(2)).

A trade mark initially provides the owner with 10 years of protection, which can be renewed indefinitely as long as the trade mark is still in use (TMA s 72(3)). A registered trade mark becomes a type of property and may be licensed to others for use.

Types of Infringement

Ria explains the different forms of infringement in s 120

Rohan Davies explains the different forms of infringement under s 120

TMA s 120 provides for three ways in which a trade mark can be infringed.

  • A person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the registered trade mark in relation to goods or services in respect of which the trade mark is registered. (TMA s 120(1))
  • A person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the registered trade mark in relation to (TMA s 120(2)):
    • For goods: goods of the same description or services that are closely related to registered goods; or
      • For services: services of the same description or goods that are closely related to registered services.
  • A person uses as a trade mark a sign that is substantially identical with, or deceptively similar to a registered trade mark that is well-known in Australia, in relation to (s 120(3)):
    • The goods or services are not of the same description or not closely related; and
    • because the registered trade mark is well-known, the sign would be likely to be taken as indicating a connection between the unrelated goods/services and the registered owner of the trade mark; and
    • the interest of the registered owner are likely to be adversely affected.

In relation to well-known trade marks, take into account the extent to which the trade mark is known within the relevant sector of the public, whether as a result of the promotion of the trade mark or for any other reason (TMA s 120(4))

Same Goods/Services (TMA s120(1))

Known as 'vanilla' infringement, where the defendant is using a mark as a trade mark, which is substantially identical or deceptively similar to the registered mark, with respect to the same goods or services for which the trade mark is registered. For example, the registered trade mark is used with respect to cola flavoured drink and the alleged infringing mark is used on cola flavoured drink. The onus is on the registered owner to show trade mark infringement.

See The Coca-Cola Company v Pepsico Inc & Ors VID 876/2010 [Amanda Scardamaglia, ‘Storm in a Contour Bottle? – The Coca-Cola Company v Pepsico Inc & Ors VID 876/2010’, Fortnightly Review of IP & Media Law, Edition 18 (11 November 2010)] Teach the Class Video

Where the defendant is using a mark as a trade mark, which is substantially identical or deceptively similar to the registered mark, with respect to goods or services of the same description or goods or services that are closely related. Note this section also functions as an informal defence (see below). The onus is reversed so the defendant must prove a lack of likelihood of deception or confusion.

This subsection protects traders and the public from unscrupulous dealers who want to pass off a new product as someone else’s. It also protects against dilatation of the value of the trade mark by allowing others to use it as they like, but in different categories.

The principles of goods and services being of the same description or closely related are largely the same as apply in the context of TMA s 44. Goods will not be of the ‘same description’ if their sale under the same mark by different companies would not be likely to lead to confusion or deception. If the public would not expect the same business to supply both of the goods and/or services, then the two are unlikely to be considered closely related.

In E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2009] FCAFC 27, Gallo Winery was the registered owner of the trade mark BAREFOOT in relation to wines in Australia. Lion Nathan (Australia) started selling a specialty beer under the trade mark BAREFOOT RADLER from January 2008. Infringement was established as beer and wine were held to be goods of the same description.

Musidor BV v Tansing (t/as Apple Music House) [1993] FCA 645 concerned Musidor selling Rolling Stones bootlegs. Musidor made it plain in its advertising and get-up that the source of the origin of the goods was not authorised. Held, the disclaimer was effective to show that the goods were not related. No infringement.

In Twentieth Century Fox Film Corporation v South Australian Brewing Co Ltd [1996] FCA 1484, 'DUFF' beer which disclaimed any association with The Simpsons was still held to amount to infringement. The disclaimer was too simplistic in approach. The beer was an express reference to The Simpsons and therefore the disclaimer was not effective.

Unrelated Goods Where Trade Mark is Well-Known (TMA s 120(3)

To establish this type of infringement: the trade mark must be well-known in Australia; the person must use as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to or not closely related goods or services; because the trade mark is well-known, the sign must be likely to be taken as indicating a connection between the unrelated goods or services and the registered owner of the trade mark; and for that reason, the interests of the registered owner are likely to be adversely affected.

To determine if a trade mark is well-known in Australia, must take account of the extent to which the trade mark is known within the relevant sector of the public, whether as a result of the promotion of the trade mark or for any other reason. Must be significant brand with interests in many different categories or an international company. If their reputation is not large enough, if they are really a niche trader and it is unlikely a consumer would think they produced a product in a completely different category, then this is unlikely to apply. The onus is on the trade mark owner.

Examples of well-known trade marks:

  • Super Mario – the Nintendo trademark in Super Mario allowed the company to prevent a person from dressing up as Mario when wrestling (Nintendo Co Ltd v Care [2000] FCA 1538).
  • Virgin – obtained judgement against people trying to sell Virgin limousines or Virgin rentals. The court stressed the large investments made by Virgin in marketing and promoting the brand globally was such that if the defendant ran a Virgin ad, it was likely customers would be confused (Virgin Enterprises Limited v Klapsas [2001] FCA 1502).
  • San Remo - there was a serious question to be tried as to whether the use of SAN REMO on coffee machines infringed the (potentially) well-known trade mark for SAN REMO pasta. Note this decision was made with some reluctance (San Remo Macaroni Company Pty Ltd v San Remo Gourmet Coffee Pty Ltd [2000] FCA 1842)).

Whether goods are unrelated or not closely related is a question of degree. The less ‘unrelated’ the goods or services are, the more likely that trade mark infringement will be made out. For example, PUMA for use on beer or CADBURY for use with respect to motorcycles.

The use must indicate a connection with the owner. In Coca-Cola Co v All-Fect Distributors Ltd [1999] FCA 1721, the court held that cola lollies would not give rise to consumers questioning whether there was a connection between Coca-Cola and the lollies. This connection can arise:

  • Statutory passing off: connection based on some actual deceit or confusion – the sign indicates the goods/services are connected with whoever owns the well-known mark with which the consumer is so familiar.
  • Dilution protection: connection as to a mental association with well-known mark – whether the sign used by the defendant brings the well-known trade mark to mind and reminds the consumer of the well-known trade mark.

Finally, the owner's interests must be adversely affected. Usually quite easy to show harm at least by arguing their capacity to use or distinguish their items has diminished due to the defendant’s use of the mark. Makes it harder for the TM owner to expand it’s market. Harm can occur in two ways:

  • Statutory passing off: lost opportunity to licence, loss of custom etc (damage element in passing off).
  • Dilution protection: dilution of the well-known trade mark.

General Elements of Trade Mark Infringement

Use

Not all use constitutes trade mark infringement. A person will only infringe a trade mark if they ‘use’ a protected mark as a trade mark – this is a def must use a protected mark or very similar mark in the course of trade as an attempt to distinguish their goods or services for anothers (Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407). Won’t infringe if a mark is used but not to distinguish. The alleged infringing trade mark must be used or intended to be used as a trade mark in the course of trade – to distinguish one person’s goods/services from another (TMA s 17). The trade mark must be used or intended to be used physically in relation to goods or services (TMA s 7).

A registered trade mark is likely to amount to use as a mark if the manner in which it has been employed does not serve some other purpose – it is a descriptive term, it serves some functional requirement or to communicate some other message. Ordinarily, the use of an invented word or words will amount to use as a trade mark but not always – even invented word or words used out of context can be taken by consumers as suggestive of some quality other than commercial origin or descriptive to some degree.

Kitto J in Shell Co (Aust) Ltd v Esso Standard Oil (Aust) Ltd [1963] HCA 66 held:

‘[T]he purpose and the only purpose that can be seen in the appearance of the little man on the screen is that which unites the quickly moving series of pictures as a whole, namely the purpose of conveying by a combination of pictures and words a particular message about the qualities of Shell petrol. This fact makes it … quite certain that no viewer would ever pick out any of the individual scenes … and say to himself: “There I see something that the Shell people are showing me as being a mark by which I may know that any petrol in relation to which I see it used is theirs. And one may fairly affirm with even greater confidence that the viewer would never infer from the films that every one of the forms which the oil drop figure takes appears there as being a mark which has been chosen to serve the specific purpose of branding petrol in reference to its origin.”’

In Johnson & Johnson Australia Pty Ltd v Sterling Pharmaceuticals Pty Ltd [1991] FCA 310, it was held that J&J had only used CAPLETS in a descriptive sense as to shape and dosage and not as indicative of origin or identity.

Annabel Burton - Use as a TM and Johnson & Johnson

In Top Heavy v Killin (1996) 34 IPR 282, the words CHILL OUT were not indications of the provenance of the T-shirts. The message which the mark conveyed in general terms is an exhortation to the reader to relax. Coca-Cola could thus not assert trade mark infringement.

In Mark Foy’s Ltd v Davies Co-op Co Ltd [1956] HCA 41, Williams J held that the trade mark TUB HAPPY was capable of registration. He said:

‘Any reference that the words TUB HAPPY have to the character or quality of articles of clothing is very remote. They are in the nature of a coined phrase. Inanimate objects including articles of clothing cannot have the character or quality of happiness whether they are in a tub or not.’

Since TUB HAPPY was not being used to describe the qualities of the product (washability, freshness, cheapness), it could be registered as a trade mark.

Substantial Identity and Deceptive Similarity

These phrases mean the same thing as outlined for trade mark registration.

Substantially identical requires a side by side comparison, having regard to the similarities and difference between the essential features (Shell Co (Aust) Ltd v Esso Standard Oil (Aust) Ltd [1963] HCA 66] ). Deceptive similarily involves trade marks that so nearly resemble each other that they are likely to deceive or cause confusion (TMA s 10)

In Mars Australia Pty Ltd v Sweet Rewards Pty Ltd [2009] FCA 606, the registered trade marks, label and words MALT BALLS were sufficiently different from MALTEASERS, and purely descriptive.

Sarah Griffin-Breen on Deceptive Similarity

Mikaylah French explains the Mars case

Types of Trade Mark Dilution

Dilution in the United States and European Union does not require confusion between two trade marks. Instead, blurring and tarnishment will amount to dilution. The Australian infringement provisions bear more similarity to passing off, and there is no explicit or clear link to dilution.

Blurring

Results from the unauthorised use of a trade mark which mars the selling power of that trade mark. For example dilution by blurring might occur when the trade mark KODAK is used with respect to motorcycles or the trade mark CADBURY is used with respect to chainsaws. See for example Eastman Photographic Materials Co Ltd v John Griffiths Cycle Corp Ltd and Kodak Cycle Co Ltd, Re Trade Mark No 207006 15 RPC 105.

Tarnishment

Occurs when the use of a trade mark results in the tainting or downgrading of the positive associations the trade mark has come to convey. Often it will occur when a trade mark is linked to products of inferior quality or products of an immoral or unwholesome character or where the trade mark is portrayed in an unsavoury context likely to evoke negative thoughts about the trade mark owner. See for example Toys ‘R Us Inc v Akkaoui (40) USPQ 2d 1836 (ND Cal, 1996).

Anti-dilution provision?

Courts tend to dislike this and try to apply this as a form of consumer protection rather than an avenue for companies to protect their brand value. The requirement of connection can be read down so that it doesn’t provide protection where there is no likelihood of confusion. If this happens then can’t think of as anti-dilution. However the correct characterisation – consumer protection vs anti-dilution is still being debated. In the Nike Perfume case, the High Court said it was important to weigh competing interests carefully – ensure consumers aren’t deceived but also allowing them to access competition. Suggests courts will be reluctant to block uses of marks that are not likely to cause confusion where the category is so different from where the TM in question is not used.

Prohibition of certain acts (TMA s 121)

Under section 121 TMA a trade mark owner may prohibit certain acts in relation to the use of the trade mark and the doing of any of these acts in the course of trade also constitutes trade mark infringement. This provision operates if the registered owner of the trade mark has caused to be displayed on the registered goods a notice of prohibition as to any of the following matters:

  • Applying the trade mark to the goods, or using the trade mark in physical relation to the goods, after the state, condition, get-up or packaging in which they were originally offered to the public has been altered;
  • Altering, or partially removing or obliterating, any representation of the trade mark applied to registered goods or used in physical relation to them;
  • Removing the trade mark without also removing associated material;
    * Applying another trade mark t the registered goods or using another trade mark in physical relation to them; or
    * Using the trade mark on registered goods or in physical relation to them in a manner which would injure the reputation of the trade mark.

    So a person will infringe a trade mark where he or she engages in such conduct, unless the goods are acquired in good faith and without awareness of the notice of prohibition.

Defences to Trade Mark Infringement

For TMA s 120(2) and (3), there is no infringement where the trade mark is used in related goods or services where there is no likelihood of confusion. This is an informal defence.

TMA s 122 Defences

Section Defence
s 122(1)(a)(i) The person uses in good faith the person’s name or the name of the person’s place of business.
s 122(1)(b)(i) The person uses a sign in good faith to indicate the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services (descriptively – not used much as often wont be using as a TM).
s 122(1)(c) The person uses the trade mark in good faith to indicate the intended purpose of goods (in particular as accessories or spare parts) or services: Can use a TM to show goods (e.g. spare parts or peripherals) are compatible with another trader’s goods; Ensures TM does not provide TM owners with an extensive monopoly.
s 122(1)(d) The person uses the trade mark for the purposes of comparative advertising; Traders can use other people’s marks to compare their products to another trader’s; Use to distinguish from the competition (E.g. say my brand is better than Apple); Encourages competition and genuine comparative advertising between the two.
s 122(1)(e) The person exercises a right to use a trade mark given to the person under this Act. (E.g. if two conflicting registrations).
s 122(1)(f) A trade mark will not be infringed where the court is of the opinion that the person would obtain registration of the trade mark in his or her name if the person were to apply for it.
s 122(1)(fa) A trade mark will not be infringed where the person uses a trade mark that is substantially identical with or deceptively similar, the first-mentioned trade mark; and the court is of the opinion that the person would obtain registration of the substantially identical or deceptively similar trade mark in his or her name if the person were to apply for it.
s 122(1)(g) The trade mark will not be infringed if its use falls within a limitation or condition imposed on the registration of the mark.

Craig Sherritt on the comparative advertising defence

Natalie Cruickshanks on TM spare parts defence: http://voice.adobe.com/v/NHDUraYrgxQ

The s 122(1)(c) spare parts and accessories defence - Andrew Avenell

In the above sections, 'good faith' means an absence of ulterior motive (Angoves Pty Ltd v Johnson (1982) 43 ALR 349). Absence of good faith cannot be inferred merely from striking similiarity between the two marks (Geoffrey Inc v Luik (1997) 38 IPR 555). Use of the trade mark cannot be calculated to divert business from the registered trade mark owner or to confuse customers as to the origin of goods.

Abigail Hill explains the good faith defence in s 122 (1)(b)

Shelby McGreachan on Good faith use of own name

A person who uses a registered trade mark in relation to goods that are similar to goods in respect of which the trade mark is registered does not infringe the trade mark if the trade mark has been applied to, or in relation to, the goods by, or with the consent of, the registered trade mark owner.

This does not apply to TMA s 120(3). For example, if goods are either purchased overseas and imported or are second hand goods, then cannot infringe as you have paid for it and obtained consent because owners of goods can use goods in this way. Ensures owners can't get a bigger monopoly. This is specifically included to allow parallel importing and second hand markets.

Alex Trezise on section 123

Prior Use (TMA s 124)

This is equivalent to TMA s 44(4) honest concurrent use provisions. If a person has used a sign that is deceptively similar or substantially identical to the registered trade mark and they have been using concurrently for a period at least before the filing date of the trade mark application, then wont be infringing.

Registration of a trade mark is not necessary. But if you don’t register a trade mark, other people might be able to in some circumstances, especially if you don’t object, register your mark or a deceptively similar or substantially identical mark for the same or similar categories. If this happens defence of prior concurrent use will apply so that the person who was using the mark before the date the registered trade mark was filed, they can continue to use.

Limitations: Trading under a particular name but only in business. Can keep using but may only be allowed to keep using where the reputation exists – here in Brisbane and can’t expand the business beyond.

Rectification (TMA s 88)

Video overview by Nicolas Suzor on grounds for rejection, opposition or rectification.

Under TMA s 88(2), an aggrieved person or the Registrar can apply to the Court for an order that the register be rectified on the following grounds:

  • Any of the grounds for opposition;
  • The registration was obtained as a result of fraud, false suggestion or misrepresentation;

    * At the time the application is filed, the use of the trade mark is likely to deceive or cause confusion.

    Under s 88(1), if one of these grounds is satisfied, the court can cancel the registration of the trade mark, remove or amend the entry wrongly main or remaining on the Register, or enter any condition or limitation affecting the registration of the trade mark that ought to be entered.

In spite of section 120, if a disclaimer has been registered in respect of a part of a registered trade mark, a person does not infringe the trade mark by using that part of the trade mark (TMA s 122(2)).

Corrine Leach on s 88

Jessica Hine on s 88

Cross Claims to Trade Mark Infringement

If trade mark infringment under TMA s 120(1), (2) or (3) is claimed, the defendant can make the following cross-claims:

  • Not substantially identical with or deceptively similar to the registered trade mark;
  • No use as a trade mark – E.g. The Panadol Case, The Esso Man Case;
  • TMA s 122 defences to infringment **;
  • Consent (TMA s 123);
  • Prior Use (TMA s 124);
  • The plaintiff’s trade mark is not valid – cross claim for rectification or removal (TMA s 88);
  • The plaintiff's registered trade mark is generic (TMA s 87);
  • The plaintiff's mark contravened a limitation or condition (TMA s 86);
  • Removal for non-use (TMA s 92);

Further, the following claims can also be made in TMA s 120(2) infringement cases:

  • The defendant's use of the mark is not likely to deceive or cause confusion (TMA s 10);
  • The defendant's use of the mark is not n relation to goods or services of the same description or goods or services that are closely related to the goods or services for which the mark is registered with respect to.

Stephanie Derrington on genericide

Greer Boe on genericide

Ayaka Nakashima Edwards on genericide

Remedies

TMA s 126 gives a right to an injunction on any conditions the Court thinks fit, an election between damages (if harm) or an account of profits (if enriched by use of the trade mark) and additional damages where appropriate.

Where there has been trade mark infringement and the defendant has applied to remove the trade mark under TMA s 92 and the court finds that the trade mark has not been used during the critical period in good faith by the registered owner and there are grounds for removing the trade mark the court may not grant relief to the plaintiff by way of damages or an account of profits in respect of any trade mark infringement that has occurred during the critical period (TMA s 127).