3 stripes v 4 stripes: the remedies

4 stripes 3 stripes now the remedies

Following the decision a couple of months back that 3 of 12 Pacific Brands’s shoes had infringed adidas’ 3-stripes trade mark, Robertson J has now:

  1. made a declaration that Pacific Brands infringed;
  2. granted an injunction permanently restraining Pacific Brands from making or selling etc. 2 of the 3 shoes found to infringe;[1]
  3. awarded $20,000 damages; and
  4. ordered Pacific Brands to pay 30% of adidas’ costs.

The amount of damages was resolved between the parties. There are a couple of points of interest in the terms of the injunction and the costs order.

First, in relation to the injunction, adidas had sought an injunction which restrained Pacific Brands both in relation to the specific shoes found to infringe and also “from otherwise infringing” the 3-stripes trade mark. Robertson J refused this wider injunction. The practical reality of 9 styles either abandoned or found not to infringe served a telling warning against the injunction sought:

because, as these proceedings have shown, such an order would lack sufficient clarity and definition and the Court should not make an order in relation to conduct where a person would not readily know whether or not its proposed conduct breached the order. What is the appropriate relief must depend on the facts and on the underlying dispute and I do not derive much assistance from the form of relief granted in trade mark cases which concerned primarily words because infringements by words are generally clearer than by designs.[2]

His Honour also refused to include one of the 3 infringing styles in the order because the shoe had been taken off the market 7 years earlier and there was no sufficient risk of its reintroduction. While the other 2 infringing shoes had been taken off the market in 2009, an injunction was warranted. First, no unconditional undertaking had been given in relation to them. Secondly, while a broad undertaking had been given, his Honour considered the sale of these 2 styles after that undertaking was in place breached it. His Honour also considered that the evidence that Pacific Brands’ Global Trading division – the “division” which had sold the shoes – had been closed down was not “sufficiently cogent” to persuade him that there was no sufficient further risk of infringement.

Thirdly, the terms of the injunction extend also to authorising, directing or procuring other to make or sell the infringing shoes.

On the costs question, Robertson J considered the “old” rules which included an automatic one third reduction to the costs where less than $100,000 was recovered were applicable as the action started before the new, 2011, rules came into force. However, his Honour exercised his discretion not to apply that rule. The Federal Court was an appropriate forum to have brought the action in and damages were not the primary relief being sought. The costs were reduced, however, to reflect the degree of adidas’ success, particularly bearing in mind it had pursued 12 styles of shoe as part of an overall strategy to obtain broad injunctive relief. The little weight accorded to the survey having regard to the substantial amount of evidence it involved, in the face of Pacific Brands’ objections, was also a factor in the reduction of costs.

Adidas AG v Pacific Brands Footwear Pty Ltd (No 4) [2013] FCA 1335


  1. The terms of the injunction were:  ?

    The respondent, whether by its servants, agents or otherwise, be permanently restrained from:

    (a) manufacturing, procuring the manufacture of, importing, purchasing, selling, offering to sell, supplying, offering to supply or distributing footwear in the form depicted in any of Exhibits K or L in these proceedings, being the footwear depicted in Annexures B and C to these Orders;
    (b) authorising, directing or procuring any other company or person to engage in any of the conduct restrained by sub-paragraph (a).

  2. This may be contrasted with the typical injunction in a patent case that thou shalt not infringe the patent; leaving the infringer to run the gauntlet.  ?

When do 4 stripes infringe 3?

adidas has successfully sued Pacific Brands for infringing its “3 stripes” trade mark through the sale of three styles of shoes with 4 stripes; but failed in respect of six other styles. Three other styles settled before action, 2 without admissions.

adidas relied on 2 registered trade marks, TM No 131325 dating from 1957 and TM No 924921 dating from 2002. (If you have been on Mars for the last 50 years) you get the basic picture from TM No 924921:

TM 924921
TM 924921

registered for “footwear including sport shoes and casual shoes” in class 25. There is also an endorsement:

Trade Mark Description: The trademark consists of three stripes forming a contrast to the basic color of the shoes; the contours of the shoe serves to show how the trademark is attached and is no component of the trademark. * Provisions of subsection 41(5) applied.*

First, accepting that the stripes played a decorative role, Robertson J nonetheless found that Pacific Brands used all the stripe combinations on the shoe styles in issue as trade marks. In reaching this conclusion, his Honour was heavily influenced at [64] by the evidence [1] that sports shoe manufacturers typically placed their trade marks on the side of the shoe. Consistently with orthodoxy, it was nothing to the point that consumers might not know which manufacturer was actually behind the product or that other trade marks such as “Grosby” also appeared on the shoe.

The Airborne Shoe illustrates why Robertson J held some styles infringed:

Airborne shoe
Airborne shoe

The fact that there were 4 stripes rather than 3 tended against a finding or infringement. However, that was outweighed by the overall impression conveyed. At [235], his Honour explained:[2]

this shoe is deceptively similar to the applicants’ trade marks. I note in particular the parallel equidistant stripes of equal width (with blue edgings) in a different or contrasting colour to the footwear, running from the lacing area to the instep area of the shoes.

In contrast, the shoes found not to infringe were all found not to convey the sense of equidistant stripes against a contrasting background, let alone a sub-set of three “parallel” stripes.[3]

Perhaps, most strikingly, the Basement style at [282] conveyed the idea of two sets of two stripes rather than three or four equidistant stripes.

Basement shoe
Basement shoe

Next, the Boston shoe:

Boston shoe
Boston shoe

did not convey the idea of a group of stripes against a contrasting background:

there are four stripes rather than three and an obvious slightly wider gap between the second and third stripes. That is the first point. I do not conclude that there are two groups of two stripes. In addition, the inclusion of panels in the shoe of a similar colour to the stripes (black or close to black), and the stitched-in element of contrasting colour (white) extending behind the stripes, mean that as a matter of impression there is no deceptive similarity with the applicants’ trade marks. There is no sufficiently clear impression of the stripes forming a contrast to the basic colour of the shoes or being a colour different from that of the article of footwear to which the stripes were applied.

The idea of four stripes with the central pair “bridged” extended through into the Apple Pie Pink style at [296]:

Apple Pie shoe
Apple Pie shoe

Robertson J also found that the Stingray Black style did not infringe:

Stingray Black shoe
Stingray Black shoe

At [305], his Honour explained:

there are four “stripes”; the stripes taper to a narrower end towards the sole of the shoe and are therefore not of equal width; the gaps between the stripes are not equal and taper towards the top of the shoe at the lacing; and the four stripes have a curved element and are therefore not parallel. The features of the applicants’ trade marks relied on by the applicants in relation to this shoe are not those which give rise to the dominant visual impression of the trade marks as three parallel equidistant stripes of equal width. This shoe does not create the visual impression of three parallel equidistant stripes of equal width.

A couple of other points

First, Robertson J did not buy adidas’ invitation to infer an intention to infringe, or at the very least “to sail too close to the wind”[4] from an alleged pattern of copying. Pacific Brands withdrew two shoe styles said to be the foundation of this pattern without any admission of liability. A third style, the Stringray boot was withdrawn with an admission, but his Honour regarded that matter as resolved.

Secondly, adidas made an interesting attempt to bolster its case on infringement by the use of a survey. The survey purported to show that some 14%, 34% and 19% of those shown three different styles “similar” to Pacific Brands’ styles identified adidas as the source of the product because of the presence of stripes.

The survey was conducted online. Each participant was shown one of four images of a leg with a shoe style on its foot. (Three were intended to be versions of Pacific Brand styles; one, the control, was unmarked.) The participants were then asked a series of questions including:

B1. Who do you think makes this shoe?

B2. Why do you say that? Please be specific and explain the reasons for your answer in question B1.

Robertson J, however, accorded the survey little weight in making his assessment. There were a variety of reasons for this. These included, first, at [196] that the showing of the images online did not sufficiently replicate or correspond to the experience of the consumer in the market place (apparently this is known as “ecological validity”). Secondly, at [205] question B1 was impermissibly leading. Thirdly, at [210]-[211] the “control leg” was inadequate for the purpose because the absence of decoration signalled to some consumers that it was not sourced from a major brand.

adidas AG v Pacific Brands Footwear Pty Ltd (No 3) [2013] FCA 905 (version with images here)


  1. Referred to at [54].  ?
  2. Likewise, the Stingray shoe at [293] and the Apple Pie at [296].  ?
  3. At [217], his Honour found these features constituted the dominant impression conveyed by the registered trade marks.  ?
  4. Invoking the well-known formulation from Australian Woollen Mills at 658.  ?

Trade marks and survey evidence in Australia

Adidas is suing Pacific Brands, alleging that the latter’s use of 3 stripes on footwear infringes Adidas’ registered trade marks for the “3 Stripes” (the judgment doesn’t identify which trade marks or the Pacific Brands’ product(s) in question).

Adidas gave notice under CM-13 (this is .doc download link, but the terms of the practice note are also set out in the judgment) that it intended to conduct a consumer survey.

It would appear that what Adidas proposed to ask survey respondents was:
After setting out the proposed form and methodology of survey and control to be used the Notice set out the proposed survey questions as follows:
(a) Who do you think makes this shoe?
(b) Why do you say that?
(c) When did you last buy a pair of sports shoes?

Pacific Brands sought an order preventing the survey being undertaken or used. Pacific Brands argued that the survey was a waste of time and money because:

  1. it had conceded Adidas had a reputation in the 3 stripes trade mark in Australia; and
  2. whether or not the use of the stripes on Pacific Brands’ footwear was use as a trade mark or, if it was, was deceptively similar to Adidas’ trade marks,
were purely questions of law for the judge alone.
Robertson J refused to block the survey for those reasons at this early stage. His Honour considered that Gummow J’s observations in Interlego did not support Pacific Brands’ argument.
In support of this proposition, the respondent referred to Interlego AG v Croner Trading Pty Ltd (1992) 39 FCR 348 at 387-389. I do not so read the passages in the judgment of Gummow J, with whom Black CJ and Lockhart J agreed. It is correct to say that deceptive similarity is a question for the tribunal of fact and is not a matter for any witness to decide but, as the passage cited by Gummow J from Lord Diplock’s judgment in General Electric Co (USA) v General Electric Co Ltd [1972] 1 WLR 729 at 738 makes plain, to say that a question is for the tribunal of fact or to describe it as a “jury question” does not mean that evidence going to that question is impermissible.
It might also be said that s 80 of the Evidence Act creates a problem for it too. See Cadbury Scwheppes v Darrell Lea at [49] – [57].
Adidas is not out of the woods yet. It would appear that Pacific Brands have identified defects in the proposed survey itself. Robertson J indicated what Pacific Brands should have done is identify those defects as part of the CM-13 process.
What the defects may be is not identified (and his Honour was not necessarily agreeing that they were defects). At least questions (a) and (b) set out above seem to be the sort of questions which courts have typically found acceptable, at least since the Jif Lemon case, as they do not involve the survey respondent engaging in undue speculation. I guess we shall have to wait and see if anything further emerges.
Adidas AG v Pacific Brands Footwear Pty Ltd [2011] FCA 1205
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