Trade mark infringement

What is a trade mark?

In Australia, a registered trade mark is a sign which helps distinguish a traders goods or services from other traders. A registered trade mark can help protect and distinguish a brand from other brands in the marketplace, thus becoming a vital component of any effective marketing strategy. In Australia trade mark registration is governed by the Trade Marks Act 1995 (Cth) (Act).

What form can a trade mark be?

According to section 6 and section 17 of the Act a trade mark can be a letter, word, name, signature, number, device, brand, heading, label, ticket, aspect of packaging, shape, colour, sound or scent, or any combination of these.

What is the purpose of a trade mark?

The purpose of registering a trade mark is to:

• ensure the owner has the exclusive right to use the brand name and to authorise others to use the registered trade mark (which is essential for franchisees and therefore likely important for franchisors to obtain);
• create an asset which can be sold; and
• protect against trade mark infringement within Australia.

When is a trade mark infringed?

The Act provides protection for registered trade marks.If a trade mark is unregistered (sign), an individual will have to rely on passing off under the common law, the elements of which are traditionally more difficult to establish.

Section 120 of the Act outlines three (3) circumstances in which a sign may infringe a registered trade mark:

• The sign is substantially identical or deceptively similar
• The goods or services are closely related or in the same description
• The trade mark is “well known”

The sign is substantially identical or deceptively similar

Section 120(1) of the Act states:

“A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered. “

The term “substantially identical” requires a close comparison of the similarities and differences between the registered trade mark and the sign when laid out side by side. These similarities and differences should then be considered in light of the essential features of the registered trade mark and the sign.^[1]

Conversely, in section 10 of the Act, a sign is considered “deceptively similar” to a registered trade mark if it:

“so nearly resembles that other trade mark that it is likely to deceive or cause confusion. “

Determining whether a sign is deceptively similar involves estimating the likely visual impression of the sign and the registered trade mark on consumers.^[2] Most consumers will remember the general impressions or significant details of the registered trade mark or sign.^[3]

The goods or services are closely related or in the same description

Section 120(2) of the Act provides that a sign will infringe a registered trade mark when it is substantially identical with or deceptively similar to a registered trade mark in relation to:

• goods or services of the same description of the registered trade mark; or
• goods or services that are closely related to the goods or services of the registered trade mark.

Goods or services need not be registered under the same description for infringement to occur. However, unlike section 120(1)the sign will not infringe the registered trade mark if the goods or services provided under the sign are unlikely to deceive or confuse. The onus is on the defendant to establish that there is no-likelihood of confusion.

The trade mark is “well known”

Well known trade marks are afforded greater protection under the Act. Section 120(3) states that a sign may be infringing even if it is not related to the goods or services of the registered trade mark if:

• the registered trade mark is “well known” in Australia; and
• because the registered trade mark is well known, the sign would likely indicate a connection between the goods or services of the sign and the owner of the registered trade mark.

The court will take into account the extent to which the registered trade mark is known within the relevant public sector in determining whether the registered trade mark is well known.

Penalties for trade mark infringement

The court may award relief pursuant to section 126 of the Act as follows:

Injunction

The court may grant an injunction, on any conditions the court thinks relevant. Under an injunction the registered trade mark infringer will be required to cease using the infringing sign.

 Damages or an account of profits

The court may, at the option of the registered trade mark owner, grant the registered trade mark owner damages or an account of profits.

The registered trade mark owner will not be granted damages or an account of profits if:

• the infringer has applied for an order that the registered trade mark is removed from the trade mark register in respect of the infringing goods and services; and
• the court find that the registered trade mark was not used in good faith by the registered trade mark owner in relation to those goods and services, during the period the registered trade mark was claimed to be infringed.

Additional damages

The court may grant additional damages if the court considers it appropriate by having regard to:

• the flagrancy of the trade mark infringement;
• the need to deter similar infringements of registered trade marks;
• the conduct of the infringer that occurred after the trade mark infringement;
• the conduct of the infringer that occurred after the infringer was informed that it had allegedly infringed the registered trade mark;
• any benefit accrued to the infringer as a result of the infringement; and
• any other relevant matters.

Penalties for importation

Other penalties under Part 13 of the Act relate to goods imported into Australia which infringe or may appear to infringe a registered trade mark. These penalties include the seizure, inspection and recall of goods which bear the infringing trade mark.

Links and further references about trade mark infringement

Cases

Mantra Group Pty Ltd v Tailly Pty Ltd (No 2) [2010] FCA 291
Solahart Industries Pty Ltd v Solar Shop Pty Ltd [2011] FCA 700
Coca Cola Co v All-Fect Distributors Ltd (1999) 96 FCR 107

Legislation

Trade Mark Act 1995 (Cth)

Need a trade mark lawyer to advise your business?

Dundas Lawyers advises IP rich businesses on their use intellectual property for commercial exploitation, risk minimisation and to build brand capital. If you need further information regarding a trademark matter contact me for a confidential and obligation-free discussion:

Disclaimer

This article contains general commentary only.  You should not rely on the commentary as legal advice.  Specific legal advice should be obtained to ascertain how the law applies to your particular circumstances.

[1] Coca Cola Co v All-Fect Distributors Ltd (1999) 96 FCR 107.

[2] Coca Cola Co v All-Fect Distributors Ltd (1999) 96 FCR 107.

[3] De Cordova v Vick Chemical Co (1951) 68 RPC 103.

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