Licensing relief

The Full Court has restored some commercial sanity to trade mark licensing in Australia and ruled that Manassen, the parent company, was an authorised user of the TRIDENT trade marks owned by Trident Foods (the subsidiary). This is an important ruling as it is a common arrangement for a corporate group’s trade marks to be held by an IP “holding company” which is often not the parent of the group.

Trident Seafoods, a large American corporation, has its trade mark:

blocked in Australia by Trident Foods’ TRIDENT registrations. It therefore tried to get Trident Foods’ registrations removed for non-use.

The trial judge found that Trident Foods had not used its trade marks in the relevant period, but exercised her Honour’s discretion against removal. Her Honour found that Trident Foods did not use its trade marks itself; they were used by Manassen, which was Trident Foods’ parent. The trial judge considered that the arrangements did not constitute the exercise of control by Trident Foods over Manassen to qualify as authorised use under section 8. Trident Seafood appealed her Honour’s decision not to order removal. The Full Court held that her Honour had erred and should have found Manassen’s used was authorised use and so the removal action failed because Trident Foods proved use of its trade marks in the relevant period. It also held that there was no error in the exercise of the discretion not to remove the registrations.

There was licensed use

At [44], the Full Court set out the trial judge’s findings that Manassen was not Trident Foods’ authorised user:

I am not satisfied that the evidence identified by Trident Foods shows that Manassen’s use of the “TRIDENT” trade mark has been “under the control of” Trident Foods within the meaning of s 8 for the following reasons:

(1) The corporate relationship between Trident Foods and Manassen does not place Trident Foods in a relationship of control over Manassen; rather, the converse is the case. The commonality of directors does not, without more, permit Trident Foods to exercise control over Manassen.

(2) Ms Swanson’s evidence is in the nature of assertion. It does not include any particular illustration of conduct by Trident Foods amounting to actual control of the use of the “TRIDENT” trade mark.

(3) The fact that Ms Swanson considered it unnecessary to give directions, whether by reason of the existence of the VQM Manual or otherwise, is not relevant to the question of whether Manassen had obligations to Trident Foods in relation to the use of the “TRIDENT” trade mark.

(4) Any control that Ms Swanson might personally exercise by virtue of her membership of the Innovations Council (which was asserted but not demonstrated) does not prove control by Trident Foods.

(5) The identification of Trident Foods as trade mark owner on products supplied by Manassen does not prove use of the trade mark under the control of Trident Foods.

(6) Assuming that the VQM Manual is owned by Trident Foods jointly with other corporate entities in the Bright Group, Trident Seafoods did not demonstrate that the VQM Manual conferred any relevant control on Trident Foods over Manassen.

(7) I am not satisfied on the evidence that there was an unwritten licence agreement in place, notwithstanding the recitals to the 3 November 2017 agreement. The affidavit evidence does not support the accuracy of the recital as to that unwritten agreement.

At [44], the Full Court noted that Lodestar required actual control over the use of the trade mark to qualify as authorised use under section 8. Whether there was actual control was a question of fact and degree. However, control could arise “where there was obedience to the trade mark owner “so instinctive and complete that instruction was not necessary”.

At [45], the Full Court considered the relevant issue was not which company controlled the other, but whether or not Trident Foods had control over the use of the trade marks by Manassen even though Trident Foods was its wholly owned subsidiary. The Full Court held that there was relevant control. The two companies were acting with “unity of purpose”. Here:

  • the two companies had common directors;
  • as directors of Trident Foods, those directors had obligations to maintain the value of its trade marks (which were valued in its books at $10 million)

    To that end Trident Foods necessarily controlled Manassen’s use of the marks by reason of the simple fact that it owned the marks and its directors, who were also Manassen’s directors, must have had one common purpose, being to maximise sales and to enhance the value of the brand.
    So it was “commercially unrealistic” in these circumstances not to infer the common directors necessarily wished to ensure the maintenance and enhancement of the value of the brand (emphasis supplied)

  • further, every packet sold by Manassen bore a notice that the trade marks were owned by Trident Foods
  • the corporate relationship, the commonality of directors and the shared processes between the two companies meant it was not surprising there were no particular instances of actual control being exercised over Manassen
  • It was inconceivable that Manassen was using the trade marks without the knowledge, consent and authority of Trident Foods

As a result, the Full Court considered it was not accurate to characterise Trident Foods as merely acquiescing in Manassen’s use of the trade marks rather than controlling that use. At [51]:

Mere acquiescence denotes passive acceptance of Manassen’s use but the corporate relationship, common directorships and arrangements between the companies required active engagement by those directors to protect Trident Foods’ valuable goodwill ($10 million in the books of Trident Foods, PJ [161(1)]). Trident Foods’ active consent and authority must constitute an unwritten licence for use of the marks.

So, Trident Foods demonstrated that it had used its trade marks (through its authorised user, Manassen) during the relevant non-use period.

The discretion not to remove under s 101(3) & (4)

If it had been necessary, the Full Court also rejected Trident Seafoods’ argument that the trial judge should not have exercised her discretion against removal. In reaching that conclusion, the trial judge had properly taken into account the length and extent of Trident Foods’ reputation in the TRIDENT trade marks and the potential for confusion if Trident Seafoods introduced its trade mark into the market place.[1] At [37]: the Full Court explained:

The criticisms of the primary judge are unfounded. The primary judge did identify the relevant context and the evidentiary foundation for her conclusion about confusion. Trident Seafoods’ asserted error constitutes nothing more than a disagreement with the evidence the primary judge considered should be given weight and her characterisation of the relevant context. At PJ [161] the primary judge identified, amongst other things, that the Trident marks have a substantial reputation in Australia having regard to the brand’s “high penetration in Australian households that it is probably in most households at some point during the year”, the fact that there is “not an independent retail channel in Australia that does not carry a ‘TRIDENT’ brand product”, “‘TRIDENT’ branded products are on promotion with independent retailers every month of the year, across the range”, and “‘TRIDENT’ is the number 1 selling brand for sweet chilli sauce, dates and coconut cream”. The primary judge also referred expressly to the competing contentions of Trident Seafoods about the potential for confusion at PJ [159] to [165]. It must be taken from the primary judge’s conclusion at PJ [179], particularly PJ [179(5)] that the primary judge was not persuaded by Trident Seafoods’ submissions about the prospect of confusion. We also do not accept that, in the circumstances identified by the primary judge at [161], there was insufficient evidence for the primary judge to conclude that removal of the marks would create a prospect of confusion in the minds of consumers. The primary judge’s finding at [179(5)] that “confusion is likely to be experienced by consumers who purchase food products at supermarkets because the ‘TRIDENT’ mark is likely to be associated in the minds of those consumers with an array of food products (not necessarily assumed to be limited to, for example, tinned products or tinned products of a particular variety) emanating from a single supplier and available for purchase at supermarkets” is unassailable. The finding was not only open on the evidence but, in our view, was correct. The fact that her Honour did not consider the TRIDENT brand had any residual reputation in respect of fish is not inconsistent with and does not undermine this conclusion.

The Full Court also rejected Trident Seafoods’ arguments that the trial judge had erred in treating mussels, oysters and oyster sauce as falling within “fish” and “fish products”. Trident Seafoods based its arguments on dictionary definitions of these terms. However, a “fair reading of the Nice Classifications discloses that molluscs and crustacean were treated as within the meaning of “fish” and other dictionary definitions also included molluscs and crustaceans within the meaning of ”fish”.

Trident Seafoods Corporation v Trident Foods Pty Ltd [2019] FCAFC 100 (Reeves, Jagot and Rangiah JJ)


  1. Trident Seafoods currently markets its products in Australia under the trade mark “Bountiful”.  ?

Trade mark licensing problems

Trident Seafoods has failed to get Trident Foods’ registrations for TRIDENT removed for non-use, but only because Gleeson J exercised her Honour’s discretion against removal.

Trident Foods has had TRIDENT registered for fish and fish products in class 29 since 1973, TM No. 266,625 and, since 1983, for meat, fish, poultry and various extracts, preservatives and pickles, TM No. 400,953.

Trident Seafoods was founded in the USA in 1973. It is apparently the largest seafood distributor in North America. It uses and has registrations all round the world – except for Australia and New Zealand – the trade marks “Trident Seafoods” and a stylised logo incorporating those words. It has been marketing its products in Australia since 2007 under the trade mark “Bountiful”, but its attempt to register “Trident Seafoods” has been blocked by Trident Foods’ prior registrations. It brought an action under s 92(4)(b) to remove those blocking registrations on the grounds of non-use. The non-use period was 7 January 2011 to 7 January 2014.

There is a good chance you have, or have had, some TRIDENT condiments on your shelf, but here’s the thing. Since at least 2000, Trident Foods did not itself manufacture and sell TRIDENT branded products. The products were manufactured and sold by Manassen Foods Australia. Trident Foods claimed Manassen’s use was use as an authorised user.[1] Gleeson J, however, rejected this claim but, as noted above, decided it was appropriate to exercise the discretion under s 101(3) not to order removal.

Manassen was not an authorised user

There was no written licence agreement between Trident Foods and Manassen until 3 November 2017.[2]

In addition to that licensing arrangement, Trident Foods relied on the corporate relationship with Manassen, the involvement in their respective businesses of two common directors and Manassen’s compliance with the Bright Food Group’s quality assurance manual.

Trident Foods is a wholly owned subsidiary of Manassen (and both are members of the same corporate group, the ultimate holding company of which is Bright “Cayman Islands”). Nonetheless, Trident Foods relied on the essentially pragmatic approach applied by the Registrar:[3]

There is nothing unusual in a large company such as Henry Schein, Inc and/or its predecessors (that is “the Company” as defined earlier) incorporating a wholly owned subsidiary in order to hold its worldwide trade mark (or, for that matter, patent or other IP right) portfolio. It is very common practice” because, inter alia, it efficiently streamlines processes for the prosecution and renewal of properties in the portfolio and it avoids the need to record name changes, mergers or assignments around the world should the parent company restructure or change names.

Gleeson J rejected this. Based on the Henschke v Rosemount and the Lodestar v Campari cases, her Honour held at [84] that “control” for the purposes of authorised use required “actual control” “as a matter of substance”.

The corporate relationship between Trident Foods and Manassen did not provide that. At [100(1)]: Gleeson J explained:

The corporate relationship between Trident Foods and Manassen does not place Trident Foods in a relationship of control over Manassen; rather, the converse is the case. The commonality of directors does not, without more, permit Trident Foods to exercise control over Manassen.

Trident Foods led evidence from a Ms Swanson, one of the two directors:

We have always maintained control over Manassen from the point of view of [Trident Foods’] as we have fiduciary obligations to act in the interest of [Trident Foods]. One of the things that has been considered, at least by me, since appointment as a director of Trident, is the quality and standard of the goods being sold under [Trident Foods’] trade mark registrations. As a director of Manassen, I appreciate the high standard of the goods that are sold by this company. As such, I have never had any cause for concern regarding the damage that could occur to the TRIDENT brand owned by [Trident Foods]. If there ever was a suggestion that poor quality goods were to be sold under [Trident Foods’] TRIDENT brand, I would be empowered and authorised to prevent such an occurrence.

Ms Swanson also gave evidence that Manassen had to comply with the Bright Food Group’s vendor quality management system (the VQM Manual) which was in place to maintain quality measures over all of the Group’s brands. In addition, she participated each month in meetings of Manassen’s “Innovation Council” which decided what products Manassen would sell, including “Trident” products, and were concerned with brand valuation and impairment to ensure that the brand was performing well and to avoid devaluation.

Gleeson J considered this was inadequate to establish actual control. Trident Seafoods argued that the directors would be in breach of their fiduciary duties to Manassen if they sought to exercise quality control over its operations on behalf of Trident Foods. Thankfully, Gleeson J did not accept this in terms. Rather, it seems Ms Swanson’s evidence was insufficient because it was at the level of assertion, without demonstrating examples of control being exercised by Trident Foods. At [100] points (2) – (6), her Honour explained:

(2) Ms Swanson’s evidence is in the nature of assertion. It does not include any particular illustration of conduct by Trident Foods amounting to actual control of the use of the “TRIDENT” trade mark.

(3) The fact that Ms Swanson considered it unnecessary to give directions, whether by reason of the existence of the VQM Manual or otherwise, is not relevant to the question of whether Manassen had obligations to Trident Foods in relation to the use of the “TRIDENT” trade mark.

(4) Any control that Ms Swanson might personally exercise by virtue of her membership of the Innovations Council (which was asserted but not demonstrated) does not prove control by Trident Foods.

(5) The identification of Trident Foods as trade mark owner on products supplied by Manassen does not prove use of the trade mark under the control of Trident Foods.

(6) Assuming that the VQM Manual is owned by Trident Foods jointly with other corporate entities in the Bright Group, Trident Seafoods did not demonstrate that the VQM Manual conferred any relevant control on Trident Foods over Manassen.

Finally, Gleeson J was not prepared to find there had in fact been an unwritten licence agreement in place as claimed in the recitals to the 2017 document. The claim was inconsistent with the evidence of how things had actually operated.

It is not possible to tell from the judgment what the contents of the VQM Manual were. One must wonder, however, whether much would really be gained by requiring the directors of Trident Foods to have met and formally adopted the relevant parts of the VQM Manual (assuming there were any) as the quality standards that Manassen needed to comply with and, further, to meet formally as directors of Trident Foods and approve changes to any applicable quality standards or even to meet at regular intervals to consider whether Manassen was complying with quality standards they had prescribed. Unless a subsidiary can never exercise control of its parent or a related body corporate that was not a subsidiary, nonetheless, it would seem that level of formalism is required.

Her Honour’s approach may be compared to that of Nicholas J in Dunlop v Goodyear at [88] and [121]. Of course, in that case the trade mark was owned by the parent, not the subsidiary; there seem to have been numerous written agreements in place and some evidence of head office (i.e., the parent) issuing instructions about the business and the use of the trade marks in the business.

As already indicated, Gleeson J went on to exercise the discretion not to remove Trident Foods’ registrations. In what is already an overly long post, that and some other points of interest will have to await consideration another day.

Trident Seafoods Corporation v Trident Foods Pty Limited [2018] FCA 1490


  1. As you know, under s 7(3), authorised use of a trade mark by a person is taken to be use of the trade mark by the registered owner. And, under s 8 a person is an authorised user of a trade mark if that person uses the trade mark under the control of the trade mark owner. Section 8(3) and (4) provide that “control” may be “quality control” or “financial control”, although s 8(5) does provide that s 8(3) and (4) do not limit the meaning of “under the control of”.  ?
  2. The recitals stated that there had been an unwritten licence agreement between them since 2000 and this document reflected the parties’ wish to reduce the terms of their licence to writing. Apparently, in reliance on Film Investment Corporation of New Zealand Ltd (Receiver Appointed) v Golden Editions Pty Ltd [1994] FCA 11; (1994) 28 IPR 1 at 15; Black & Decker Inc at [147] and [148]; Allam at [430] and [431].  ?
  3. HS TM, LLC v Schein Orthopadie-Service KG [2016] ATMO 63 at [23]; heard before Lodestar, but decided afterwards.  ?

Are you carrying on business in Australia by registering a trade mark here

If you need authority for the proposition that registering a trade mark, or enforcing the rights under the registration, does not necessarily mean you are carrying on business in Australia, Besanko J may help you out.

The ACCC sued Nexans SA and others alleging they were engaged in price fixing cartel.

Nexans SA is the global parent of the Nexans group. It had registered NEXANS in Australia as a trade mark. It had also licensed the trade mark to Nexans Australia, which was a member of the group, but not a direct subsidiary.

Besanko J rather sensibly stated at [282]:

…. I do not think the fact that the ultimate holding company of a large worldwide Group, insures all of the directors and officers of the companies comprising the Group means that the ultimate holding company is carrying on business within all the jurisdictions where companies in the Group are operating or is even a reasonably strong indication of that fact. The registration of trade marks in Australia by an overseas company could be an indication that the company is carrying on business in Australia, but, of course, it is only the beginning of the inquiry. The fact is that here there is a licence to Nexans Australia which (depending on the precise circumstances) may be considered to be an authorised user of the registered trade marks under s 8 of the Trade Marks Act. Nor do I think the fact that Nexans SA took action in this Court to protect its rights as owner of the registered trade marks indicates that it was carrying on business within Australia.

His Honour then explored other factors which in the end did lead to Nexans SA being held to carry on business in Australia. Ultimately, however, Besanko J did not consider it had engaged in the cartel behaviour, but another company, Prysmian, had.

Australian Competition and Consumer Commission v Prysmian Cavi E Sistemi S.R.L. (No 12) [2016] FCA 82

Notice and take down

If you have to send a take down notice to someone under the DMCA, send it to them and not their parent:

Prof. Goldman here; Plagiarism Today here.

Under our legislation, the notice must be sent to the carriage service provider’s “designated representative” (Reg. 20D) and the carriage service provider must publish a notice on its website prominently identifying the designated representative, and their contact details, to whom such notices should be sent: Reg. 20C.

Of course, all this begs the question, what on earth (or in cyberspace) is a “carriage service provider”? (Unhelpful) hint via s 10 of the Copyright Act, look at s 87 of the Telecommunications Act 1997.