ACL

Self Care v Allergan – Part 2

Previously on IPwars.com we looked at why the High Court held PROTOX did not infringe BOTOX. The High Court also ruled that “instant BOTOX® alternative” did not infringe and overturned the Full Court’s ruling that the phrase was misleading or deceptive contrary to the ACL.

A recap

You will recall that Allergan has registered BOTOX as a trade mark for “[p]harmaceutical preparations for the treatment of … wrinkles” in class 5. The product Allergan makes and sells under the BOTOX trade mark is an injectable pharmaceutical which must be administered by a health professional. One treatment of BOTOX preparation can last for up to several months.

Because of its “overwhelming” and “ubiquitous” reputation in BOTOX, however, Allergan has also achieved registration of BOTOX in class 3 for anti-ageing and anti-wrinkle creams.

The second FREEZEFRAME product Self Care sells is INHIBOX. The INHIBOX product is a cream which the user can apply themselves at home and which lasts for up to a few hours to reduce the visible signs of ageing.

The INHIBOX product was sold in two forms of packaging:

Old packaging – Packaging A

Image of INHIBOX packaging showing FREEZEFRAME and INHIBOX trade marks, instant Botox® alternative and explanatory text on back

New packaging – Packaging B:

Image of INHIBOX packaging showing FREEZEFRAME and INHIBOX trade marks, instant Botox® alternative and explanatory text on back

Both forms of packaging included the phrase “instant BOTOX® alternative”. You will also notice that the back of both forms of packaging includes a longer declaration: “The original instant and long term Botox® alternative”.

Why “instant Botox® alternative” did not infringe

Self Care’s INHIBOX product being an anti-wrinkle cream falling squarely within the scope of Allergan’s BOTOX registration in class 3, the High Court had identified at [22] that the trade mark owner had to prove two things to establish trade mark infringement under s 120(1):

  1. that the impugned sign was being used as a trade mark; and
  2. that the impugned sign was substantially identical or deceptively similar to the registered trade mark.

At [23], a sign is being used as a trade mark when it is being used as “a badge of origin” to indicate a connection between the goods and the user of the mark.[1]

And whether that is the case is to be determined objectively in the context of the use without regard to the subjective intentions of the user. To repeat the High Court’s explanation at [24]:

Whether a sign has been “use[d] as a trade mark” is assessed objectively without reference to the subjective trading intentions of the user[50]. As the meaning of a sign, such as a word, varies with the context in which the sign is used, the objective purpose and nature of use are assessed by reference to context. That context includes the relevant trade[51], the way in which the words have been displayed, and how the words would present themselves to persons who read them and form a view about what they connote[52]. A well known example where the use was not “as a trade mark” was in Irving’s Yeast-Vite Ltd v Horsenail[53], where the phrase “Yeast tablets a substitute for ‘Yeast-Vite’” was held to be merely descriptive and not a use of “Yeast-Vite” as a trade mark. Therefore, it did not contravene the YEAST-VITE mark. (citation omitted)

Applying that test, the High Court held that Self Care was not using “instant Botox® alternative” as a trade mark. There were a number of reasons contributing to this conclusion.

First, Self Care did not present the phrase in a consistent style.

Secondly, the phrase was presented alongside two obvious trade marks – FREEZEFRAME and INHIBOX – so that the phrase was less likely to be taken as a trade mark.

And thirdly, while FREEZEFRAME and INHIBOX were presented as trade marks, the phrase “instant Botox® alternative” was a descriptive phrase which in context was used only with that descriptive purpose and nature.

As to the first consideration, the High Court explained at [55]:

The presentation of “instant Botox® alternative” was inconsistent in size, font and presentation on each of Packaging A, Packaging B and the website, indicating “instant Botox® alternative” was not being used as a badge of origin to distinguish Self Care’s goods from those dealt with by another trader[126]. On Packaging A the phrase was presented vertically, marked out by four vertical lines separating each of the words. On Packaging B and on the website the phrase was presented horizontally without any lines separating the words. The arrangement of the words differed. On the packaging, each word in the phrase occupied its own line. On two website pages the phrase occupied a single line. On two other website pages the words “Instant” and “Botox®” shared a line and the word “ALTERNATIVE” appeared on the next line. The font was inconsistent. The packaging used a different font to the website pages, and one website page used a different font to the other website pages. The capitalisation was inconsistent. Three different forms were adopted: “instant Botox® alternative” on the packaging, “INSTANT BOTOX® ALTERNATIVE” on one website page and “Instant Botox® ALTERNATIVE” on three other website pages.

Then, the High Court explained at [56] that the likelihood “instant Botox® alternative” would be taken as a trade mark was diminished because its use was not as dominant as the use of FREEZEFRAME and INHIBOX:

…. This diminishes the likelihood that the phrase “instant Botox® alternative” could be objectively understood to indicate origin in itself[127]. This is because its use was not as dominant as the use of the other signs, FREEZEFRAME and INHIBOX. This is most evident on the packaging. On both Packaging A and Packaging B, “instant Botox® alternative” appeared only once, on the front of the box, in much smaller font than FREEZEFRAME and INHIBOX. FREEZEFRAME and INHIBOX were also featured prominently on the left and right sides of each box. Further …. (citations omitted)

At [57], the High Court recognised that a sign can be both descriptive and used as a trade mark (see also [25]) but the phrase “instant Botox® alternative” was not in this case:

The FREEZEFRAME and INHIBOX script style and presentation is also significant. FREEZEFRAME and INHIBOX were both distinctive and stylised signs that were apt to be perceived as brands. In contrast, “instant Botox® alternative” was a descriptive phrase that had an ordinary meaning and included within it the trade mark BOTOX (identified as such with a ® symbol). It was descriptive of the product to which it was attached as an alternative product. While a sign can both be descriptive and serve as a badge of origin, the better view is that the use of the phrase, consistent with its ordinary meaning, had only a descriptive purpose and nature[128]. As the primary judge found, the phrase amounted to “ad?speak”. (citation omitted)

As the phrase was not used as a trade mark, there was no need to consider whether it was deceptively similar to Allergan’s trade mark.

Some aspects of the High Court’s reasons

In reaching its conclusions, the High Court drew on three different uses – the two forms of packaging and the website collectively. At [54], the High Court said it was permissible “to address them together, identifying relevant similarities and differences in use.”

In this case at least, there appears to have been some overlap between Self Care’s use of Packaging A and Packaging B – the latter being introduced on the market in September 2016, the former still being on the market until February 2017. The website of course was contemporaneous with both.

Nonetheless, it might be thought a bit odd that generally the old form of packaging informed the understanding of the new form of packaging. And, if the question is whether or not the particular use on the packaging is use as a trade mark, one might wonder about the relevance of use elsewhere. It must also be acknowledged that the form of use was one only of the factors contributing to the conclusion.

The High Court’s approach therefore reinforces INTA’s longstanding message that the trade mark owner should ensure it presents its trade mark consistently. Giving this consideration too much weight in isolation, however, risks creating some sort of pirate’s charter.

Ultimately, it might be thought the result is not too surprising. Afterall, phrases like this have not been considered to be trade mark use since the House of Lords’ decision in 1934 that “Yeast tablets a substitute for Yeast-Vite” did not infringe the registered trade mark YEAST-VITE.

In explaining why the Full Court wrongly found use as a trade mark, however, the High Court advanced a very different explanation why “instant Botox® alternative” was not use as a trade mark. The Full Court had impermissibly conflated the tests of use as a trade mark and deceptive similarity. At [60], the High Court then said:

Conflation of those elements is not uncommon. As Shanahan’s Australian Law of Trade Marks & Passing Off observes, “[t]here is a common misconception that an infringer uses a sign as a trade mark if the use indicates or is likely to indicate a connection between the infringer’s goods and the owner of the registered mark”[129]. However, “factors relevant to whether there is a misrepresentation or likelihood of deception have no role to play in deciding the question of what constitutes ‘use as a trade mark’”[130]. As was stated in Coca-Cola Company v All-Fect Distributors Ltd, the inquiry is not “whether the sign indicates a connection between the alleged infringer’s goods and those of the registered owner”[131]. The correct approach is to ask whether the sign used indicates origin of goods in the user of the sign[132]. (emphasis supplied) (citations omitted)

This may be contrasted with the reason why the House of Lords held that there had been no use as a trade mark. Lord Tomlin explained:[2]

This is clearly a use of the word “Yeast-Vite” on the respondent’s preparation to indicate the appellant’s preparation and to distinguish the respondent’s preparation from it. It is not a use of the word as a trade mark, that is, to indicate the origin of the goods in the respondent by virtue of manufacture, selection, certification, dealing with or offering for sale.

The High Court’s endorsement of Coca-Cola v Allfect on this point cannot be the result of some change in the meaning or concept of “use as a trade mark”. In the Yeast-Vite case, Lord Tomlin said:[3]

The phrase “the exclusive right to the use of such trade mark” carries in my opinion the implication of use of the mark for the purpose of indicating in relation to the goods upon or in connection with which the use takes place, the origin of such goods in the user of the mark by virtue of the matters indicated in the definition of “trade mark” contained in s 3.

That is the same explanation of the concept as adopted by the High Court in Gallo at [42] and in Self Care at [23] and [53].

It also cannot really be explained by the introduction into the Trade Marks Act of s 122A and s 123. Lord Tomlin roundly rejected a similar argument by the trade mark owner in Yeast-Vite:

nor do I think it is legitimate to treat special defences available under other sections of the latter Act as constituting a measure of the right conferred by s 39.

It appears therefore that the High Court has resolved the point left open in the Gallo case at [53] – whether a retailer uses the trade mark as a trade mark when using it in relation to the genuine goods of the trade mark owner.[4]

Whether that means our law now needs amendment to provide a defence for parody and satire, or other types of nominative fair use, remains to be seen.

The ACL case

The Full Court had found that the phrase “instant Botox® alternative” conveyed the representations that use of INHIBOX would result in a similar reduction in the appearance of wrinkles to using Botox and, secondly, that the effects would last for a period equivalent to that resulting from use of Botox.

The Full Court found that Self Care had reasonable grounds for the former representation, but not the latter – the long term efficacy representation. Therefore, Self Care’s use of the phrase was misleading or deceptive in contravention of the ACL.

On appeal, Self Care did not contend INHIBOX had a similar long term efficacy to Botox. Rather, it denied that the phrase “instant Botox® alternative” conveyed the long term efficacy representation at all.

Recap of the ACL principles

At [81], the High Court confirmed that determining whether there had been a breach of s 18 required a four step analysis:

  1. Identifying the conduct said to contravene with precision;
  2. Confirming that the conduct was “in trade or commerce”;
  3. Considering what meaning the conduct conveyed; and
  4. Determining whether the conduct in light of that meaning was misleading or deceptive or likely to mislead or deceive.

At [82], the High Court also confirmed that the third and fourth steps required characterisation as an objective matter. This required viewing the conduct as a whole and its notional effects, judged by the conduct in context, on the state of mind of the relevant person or class of persons.

The context includes the immediate context – all the words in the communication and the way they are conveyed, not just the word or phrase in isolation. The context also includes the broader context – all the relevant surrounding facts and circumstances.

Next, in cases of this kind the High Court re-affirmed at [83] that it is necessary to identify an ordinary and reasonable representative member of the relevant class “to objectively attribute characteristics and knowledge to that hypothetical person (or persons), and to consider the effect or likely effect of the conduct on their state of mind.” This required allowing for a range of reasonable reactions to the conduct by excluding from consideration reactions of the ignorant or very knowledgeable, those resulting from habitual caution or exceptional carelessness and the extreme or fanciful.

The misrepresentation was not made

The High Court analysed each of the three types use – Packaging A, Packaging B and the website – separately. But the reasons why “instant Botox® alternative” was not misleading or deceptive are essentially the same.

In the case of Packaging A, the High Court noted the use of the trade marks FREEZEFRAME and INHIBOX and “instant Botox® alternative” on the front of the packaging. On the side of the packaging were printed the words “Clinically proven to erase wrinkle appearance in 5 minutes”. And on the back, there was the vertical script “The world’s first Instant and Long Term Botox® Alternative” in larger, blue lettering than the panel of explanatory text. Under the heading “Freeze wrinkles instantly”, the first paragraph of that explanatory text read:

Why wait for weeks to look dramatically younger when you can wipe away the years this very minute! freezeframe’s exclusive INHIBOX complex is clinically proven to wipe away visible expression wrinkles around the eyes and on the forehead within 5 minutes, so you get an immediate wrinkle freeze and eye lift that lasts for hours. (emphasis supplied)

The remainder of the text included three more references to the effects of INHIBOX being “long term”. This included a heading “And long term!” under which the packaging stated “”freezeframe technology is scientifically proven to reduce the appearance of wrinkles by up to 63.23% in just 28 days“ and ”freezeframe’s Dual Effect technology gives you proven instant wrinkle reduction, plus the world’s best long term wrinkle relaxing”.

Under the heading “Two of the world’s most potent wrinkle erasers* in one formula”– the packaging stated “[i]magine… the power of an instant wrinkle freeze, combined with the long term benefits of the most potent, cumulative facial relaxing technology on the planet. All in one simple formula.”

Despite all these references to “long term”, the High Court held at [102] that both the immediate and broader contexts meant the phrase “instant Botox® alternative” would not convey to the reasonable consumer in the target market that either a single treatment or long term use of INHIBIX would last for an equivalent period to a BOTOX injection.

In the immediate context – the packaging, the words “long term” must be understood in the context of “lasts for hours” and that the treatment was “instant” and working “within 5 minutes”. As a result, “long term” was mere puffery. At [99], the High Court explained:

…. The fact that the effect of Inhibox was said to be instant makes it less likely that the reasonable consumer would believe that those effects would last for as long as those of Botox. Put differently, the reasonable consumer would likely believe it too good to be true that the effects of Inhibox are both instant and as long lasting as those of Botox.

The broader context included that INHIBOX was a cream applied by the user while BOTOX is a pharmaceutical injection requiring a visit to a healthcare professional. INHIBOX was much cheaper. The two products were not sold in the same locations. In these circumstances, the High Court concluded at [101]:

Taking into account that broader context, it is difficult to conceive why the reasonable consumer in the target market would think that a topically self-applied cream obtained from the pharmacy at a relatively low cost and worn in the course of the usual activities of life (including bathing and exercise) would have the same period of efficacy after treatment as an injectable anti-wrinkle treatment that is only available to be administered by healthcare professionals at a higher cost. ….

Moreover, the reasonable consumer would not assume that the use of BOTOX in the phrase indicated a common trade connection between INHIBOX and BOTOX.

Similar reasoning led to the same conclusion in respect of Packaging A and the website even though the latter, in particular, seems to have used “long term” rather more prominently.

The errors made by the Full Court

The High Court’s reasons why the phrase “instant Botox® alternative” was not misleading or deceptive suggest a rather robust approach to assessing the impact of the conduct on the target market. In addition, its reasons provide further guidance about how the conduct should be analysed.

First, at [88] – [89], the High Court agreed the trial judge had made an appealable error by considering only the phrase and the broader context, not taking into account the immediate context as well. So, it is necessary to consider all three aspects.

Secondly, the Full Court had also erred. There are a number of strands to this. One key error was misidentification of the ordinary and reasonable consumer. A second was the false premise that consumers would think the phrase “instant Botox® alternative” conveyed an association between INHIBOX and the trade source of BOTOX.

On the second point at [89], the High Court pointed out that the trial judge had found “instant Botox® alternative” would not convey an association between INHIBOX and BOTOX and there had been no appeal from that finding.

On the first point, the Full Court had found that some members of the relevant class would know that the effects of BOTOX lasted four months. The High Court criticised the factual basis for the conclusions about how long BOTOX lasted and whether consumers knew that.

More generally, however, the High Court said the Full Court had been wrong to assess the effects of the phrase on the target market on the basis that some reasonable consumers would have been misled. At [90], the High Court explained:

…. Further, the Full Court’s statement that the target market “would have included” reasonable consumers who had that knowledge demonstrated a misunderstanding of the relevant test. The ordinary and reasonable consumer is a hypothetical construct to whom the court attributes characteristics and knowledge in order to characterise the impugned conduct. The class in fact will always have reasonable consumers with varying levels of knowledge; the question was whether the knowledge should be attributed to the hypothetical reasonable consumer in this case.

Then, as already discussed above, the High Court proceeded to analyse how the phrase “instant Botox® alternative” would be perceived and understood by the ordinary reasonable consumer in all the circumstances.

Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8


  1. Picking up the definition of What is a trade mark in s 17 as explained in Campomar and E & J Gallo at [42]: “the requirement that a trade mark ”distinguish“ goods encompasses the orthodox understanding that one function of a trade mark is to indicate the origin of ”goods to which the mark is applied“[16]. Distinguishing goods of a registered owner from the goods of others and indicating a connection in the course of trade between the goods and the registered owner are essential characteristics of a trade mark[17]. There is nothing in the relevant Explanatory Memorandum[18] to suggest that s 17 was to effect any change in the orthodox understanding of the function or essential characteristics of a trade mark.” (citations omitted)  ?
  2. Irving’s Yeast-Vite Ltd v F A Horsenail (trading as The Herbal Dispensary) (1934) 51 RPC 110 at 115.36; 1B IPR 427 at 431.37.  ?
  3. 51 RPC 115.36; 1B IPR 432.  ?
  4. See also Scandinavian Tobacco Group Eersel BV v Trojan Trading Company Pty Ltd [2016] FCAFC 91 at [49]ff and Warwick A Rothnie, ‘Unparalleled importing and trademarks in Australia,’ (2020) 21(3) Business Law International 229.  ?

Self Care v Allergan – Part 2 Read More »

Thirsty beer drinkers want …

Stewart J has dismissed Brick Lane’s ACL[1] and passing off complaints against the get-up of Torquay Beverage Co’s Better Beer.

Some facts

On 21 July 2021, Brick Lane issued a press release announcing the launch of its new Sidewinder Hazy Pale ale, a no to low alcohol beer. The range had been in development, behind the scenes, since September or November 2020. Sales of the product to the public began around 2 August 2021 including in outlets such as Dan Murphy’s.

Brick Lane’s Sidewinder Hazy Pale

The domain name had been registered and and Instagram account created on 9 July 2021. From then, the Instagram account, at least, featured an image of the Sidewinder product. Before 21 July 2021, however, there were only 9 followers (and they were likely from Brick Lane or otherwise associated with its development).

On 26 July 2021, Mighty Craft[2] announced to the ASX that it had partnered with Torquay Beverage Co and The Inspired Unemployed to form Better Beer Co and the launch of the new zero carb beer Better Beer. The announcement was picked up and widely reported in industry publications; one of which, Beer & Brewer had a “reach” of 13,000 people and another, Drinks Trade, some 27,000 people. It was not until late October 2021, however, that product actually made it on to retail shelves.

Better Beer’s beer can

There was no suggestion that the respondents had some how copied Brick Lane’s get-up.

On 3 December 2021, Brick Lane launched the second product in its Sidewinder range – an XPA Deluxe.

In April 2021, Better Beer ginger ale was launched.

The claim

As is conventional, Brick Lane argued the get-up of the respondents’ product was liable to misrepresent to the public that the product was Sidewinder or manufactured by or in some way endorsed, approved or sponsored by the manufacturer of Sidewinder.

The respective get-ups alleged:

xBrick LaneyRespondents
(1)an off-white 355 ml can(1)an off-white 355 ml can (save for the bottled product)
(2)an off-white cardboard cluster and case (where sold by cluster or case)(2)off-white cardboard cluster and case (where sold by cluster or case)
(3)a curving flared striped design (on the can, cluster and case) in blue and shades of yellow and orange with the dominant flared part of the stripes being vertically aligned(3)a curving non-flared striped design (on the can, bottle, cluster and case) in blue and shades of orange and yellow with the stripes oriented horizontally; and
(4)the use of horizontal black lettering for the Sidewinder name and horizontal off-white lettering against a black background for the name of the particular product on the can and case (the lettering, or background to the lettering, being silver on the cluster packaging); and(4)the use of dark blue lettering for the product name, the lettering being rotated vertically; and
(5)the use of a sans serif typeface in upper case for the “Sidewinder” lettering.(5)the use of a serif typeface in title case for the “Better Beer” lettering.

What went wrong

There were two main problems.

First, when the respondents started their conduct – the launch of their product a mere 5 days after the launch of the Sidewinder product, Sidewinder itself did not have any appreciable reputation with the public. At [97], Stewart J explained:

The first reason why Brick Lane’s claim in respect of the Sidewinder Hazy Pale product must fail is that at the relevant time, being 26 July 2021, there was no appreciable knowledge amongst members of the relevant class of the Sidewinder get-up. That is to say, the hypothetical member of the class of consumers purchasing beer is not likely to have any familiarity with the Sidewinder get-up with the result that on seeing the Better Beer get-up they would not be likely to confuse it with the Sidewinder get-up. As it was explained by Burley J in Homart FCA at [125], “it takes a strong case” to establish a reputation that the get-up relied on is associated by consumers with the relevant product. Put differently, even assuming a strong similarity in the respective get-ups, the hypothetical consumer is not likely to be misled or deceived into thinking that the two products are associated if they do not readily associate the applicant’s product’s get-up with the applicant or its product.

The position was different with the Better Beer ginger beer, launched later in April 2022. By then, however, both the Sidewinder and original Better Beer products had been widely promoted and distributed throughout the market so that the public must be taken to have learned to distinguish between them.

The second main reason Brick Lane failed was the strikingly different names prominently plastered over the products and their packaging. At [100], Stewart J explained:

Turning now to the differences and similarities between the relevant products’ get-up, the first observation is that each product bears a distinctive brand name – Sidewinder and Better Beer. Not surprisingly, Mr Hall’s evidence was that the Sidewinder brand name is distinctive, unique and powerful. There is no reason to disagree with that assessment notwithstanding that not everyone encountering the name may associate it with 70s jet boats – they may think of air-to-air missiles or snakes or something else equally distinctive and memorable. Equally, Better Beer is a distinctive brand name. Brick Lane submitted that because it is descriptive it is weak, but I do not accept that. It is alliterative and catchy. Moreover, Sidewinder and Better Beer are rendered in quite different styles of typeface – sans serif and serif respectively. They look and feel very different. They do not have visual or phonetic similarities such as were material to the reasoning in Homart FCA at 195(b).

As in Parkdale v Puxu, this difference was compelling in distinguishing the products.

His Honour accepted that there were distinct similarities between the relevant get-ups and did not put much store in the different orientation of the coloured stripes or banding – vertical vs horizontal.

On the other hand, Stewart J did not think the size of the cans – 355ml instead of 375ml – had any significant role to play. Of the 894 different beers on offer at Dan Murphy’s, at least 50 used the 355ml can format so it could not be described as unusual.

Overall, Stewart J concluded at [113]:

Taking all of the above matters into consideration, I am not satisfied that the hypothetical reasonable consumer of beer would at the relevant date have had any particular familiarity with Brick Lane’s Sidewinder get-up, but even if they did, they would not have been likely to be misled by the similarity of the respondents’ Better Beer get-up to the Sidewinder get-up into thinking that the products were in some way associated. As explained, that arises in particular from the distinctive names used for the different products as well as the differences between the get-ups and the features of the relevant market.

A couple of noteworthy points

As his Honour noted, the question whether there has been a contravention of the ACL in these types of cases is determined when the respondent started the relevant conduct.

Brick Lane argued that the relevant date was when Better Beer was actually on the shelves available for retail purchase – that is, late in October 2021 – by which time Sidewinder was well established in the market.

Stewart J rejected that argument at [42] – [46] finding that the relevant date was when the respondents’ launched (i.e., announced the launch of) their product. As his Honour pointed out, the promotion of a product could give rise to misleading associations regardless of whether the product was actually available for purchase. In the cases which focused on the date sales started, there was no suggestion that there had been advertising or promotion beforehand. On the other hand, in In-n-Out Burgers, the contravening conduct started (at [181] and [193]) when the respondent launched its Facebook page, not later when it opened its store.[3] Correspondingly, the date Cadbury Schweppes started marketing its product in the Pub Squash case[4] was accepted by the Privy Council as the relevant date in passing off.

Secondly, Stewart J sought to explain the role of reputation in an ACL case. Where conduct is directed to a class rather than specific individuals, case law has now established it is not necessary to establish that a substantial or not insubstantial number of that class are likely to be misled or deceived. It is only necessary to show that the ordinary or reasonable member of the class is likely to be mislead or deceived.

Stewart J considered that in this type of case it was nonetheless necessary to show some association in the mind of the public between the get-up and the applicant. After quoting the Full Court in Cadbury Schweppes v Darrell Lea at [99], his Honour explained at [40]:

… although it might be said that a particular reputation is not necessary, it is nevertheless necessary that there is some association in the mind of the relevant sector of the public between the applicant’s product and its get-up such that confusion might arise from the use of the same or a similar get-up in relation to the respondent’s product. Without the pre-existence of such an association, it could not be said that the use by the respondent of the same or a similar get-up suggests a misleading or deceptive association. The inquiry does not proceed on the assumption that the hypothetical consumer member of the relevant class is familiar with the applicant’s product; that is required to be established.

In this case, the respondents had argued that its product was in a different market segment to Sidewinder – the low carb segment vs the low alcohol segment, but Stewart J found the relevant public was the beer market generally. There was no evidence that the different “segments” operated as distinct (sub-)markets. For example, there was no evidence that beer products were arranged on retail shelves in any fashion by market segments.

Brick Lane sought to rely on a Trade Mark examiner’s rejection of Torquay’s trade mark application in the face of Brick Lane’s prior application. Stewart J pointed out at [103] that the competing applications did not feature their respective brand names. His Honour also doubted the examiner’s opinion was admissible evidence in a Court in light of Evidence Act s 76.

Finally, for those of you that recall Lord McNaghten’s famous aphorism “thirsty folk want beer, not explanations”, this case was distinguishable. In Lord Mcnaghten’s case, there had been one brewery in the town of Stone making and selling its Stone Ales for hundreds of years when the competitor opened up as Stone Brewery selling Stone Ales. When Sidewinder and Better Beer launched into the market, however, the consumer was confronted with a plethora of brands and products.

Brick Lane Brewing Co Pty Ltd v Torquay Beverage Co Pty Ltd [2023] FCA 66


  1. Australian Consumer Law s 18 and s 29(1)(g) & (h).  ?
  2. A “craft beer accelerator” and the third respondent. The Inspired Unemployed and Torquay Beverage Co held, respectively, 40% and 60% of the shares in the second respondent, Better Beer Co Pty Ltd.  ?
  3. Affirmed on appeal (without argument).  ?
  4. Cadbury Schweppes Pty Ltd v Pub Squash Co Pty Ltd (1980) 2 NSWLR 851 at 861G.  ?

Thirsty beer drinkers want … Read More »

Bohemia Crystal shattered

Like MICHIGAN for farm equipment and OXFORD for books, Burley J has ordered that Bohemia Crystal’s trade marks, BOHEMIA and BOHEMIA CRYSTAL be revoked because they are not distinctive of “glassware”.

Bohemia Crystal (BCP) had been formed in 1975 to distribute in Australia Skloexport’s products. Skloexport was the State-owned entity responsible for the export of all crystal and glassware products made in Czechoslovakia. In 1999, Skloexport went into liquidation and BCP took an assignment of its Australian trade marks. The main trade mark BCP used in this period, which had been registered since 1962 was the stylised BOHEMIA Glass mark, TM No. 319701:

Versions of this mark were used with or without the words “Made in Czech Republic” or substituting the word “Glass” for “Crystal”.

On 5 October 2001, BCP applied for and successfully registered BOHEMIA CRYSTAL for glassware and on 2 May 2003 BCP applied for and successfully registered BOHEMIA for glassware.

Host is an importer and supplier of catering goods and equipment in Australia. The business was started in 1999. One range within its 2,500 product lines is its range of glassware sourced from another Czech supplier, Forincorp, marketed under BANQUET BY BOHEMIA [1] or:

Host started importing this line in 2015. BCP made the fateful decision to start proceedings for infringement of its registered trade marks and contravention of the Australian Consumer Law for false and misleading conduct.

Burley J held that BCP’s trade marks lacked any capacity to distinguish and had not been used in such a way as to have acquired secondary meaning for the purposes of s 41(6).[2] Burley J also dismissed BCP’s allegations of misleading or deceptive conduct.

It is not going to be possible in a blog post to do justice to Burley J’s 376 paragraphs. Instead five points particularly caught my eye.

First, Burley J (who was a very experienced intellectual property barrister before his appointment) pointed out that the High Court in Cantarella referenced both ordinary consumers and traders as the criterion for whether or not a sign was inherently adapted to distinguish.

BCP argued that the test focused on what ordinary consumers would think the sign meant. It had found an expert who opined that ordinary members of the public would think “bohemia” was a reference to persons with an artistic or unconventional lifestyle.

After analysing Cantarella from [86] on, his Honour concluded at [93]:[3]

in a case such as the present, it is necessary to consider the ordinary signification of the words “Bohemia” and “Bohemia Crystal” in the context of the “target audience”, being traders and consumers of the relevant goods, to determine whether at the relevant dates other traders might legitimately desire to use these words or something similar in connection with their goods, for the ordinary signification which they possess. …. (emphasis supplied)

Here, despite the evidence of BCP’s principle witness, the evidence was largely one way. It was beyond dispute that for many centuries the geographic region known as “Bohemia” which is now in the Czech Republic had a strong reputation for producing high quality crystal and glassware. There was evidence that between at least four and ten different manufacturers used the term “Bohemia” at an important annual glassware trade show to signify the geographic origins of their products. There was also evidence from a number of dealers that the term signified to the public glassware originating from the Bohemia region. BCP’s own registered user agreements for the use of Skloexport’s trade marks had also required it to promote its products as from the geographic region, Bohemia.

Burley J concluded that other traders who had glassware manufactured in the region formerly known as Bohemia legitimately and honestly wanted to use that word to describe the geographic origins of their products. The fact that Bohemia was no longer a separate country (and had not been since the World War I) and not even the contemporary name of the region was not significant.[4]

Second, Burley J found that the evidence of use of the BOHEMIA and BOHEMIA CRYSTAL did not establish that those terms had been used by BCP as trade marks or in such a way as to have acquired secondary meaning. There were three aspects to this conclusion.

Following BP v Woolworths, promotion and use is not enough. It had to be shown that the signs as registered had been used in some way to identify the signs as being trade marks.

Next, for the most part the relevant evidence showed that what BCP had been using as a trade mark was Skloexport’s composite mark, not the terms as registered. This was not use of either trade mark as registered. Moreover it was the combination of the elements in the signs as a whole which comprised the distinctiveness. These signs should not be dissected into their component parts:

228 I have some difficulty with the proposition that the words “Bohemia” or “Bohemia Crystal” should in this context be regarded as having separate trade mark signification beyond the combination in which they appear in the composite marks described above. In my view, it is the combination of elements that is distinctive. The trade mark should be viewed as a whole and not dissected into parts. Although this is likely to be a matter of fact for each case, it is notable that several cases have cautioned against the proposition that separate elements should be so distilled; see Diamond T Motor Car Company [1921] 2 Ch 583 at 588, Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) [2012] FCA 81; (2012) 201 FCR 565 at [61], [63].

229 To my eye, the whole of the 701 mark is to be regarded as creating a complicated image that taken collectively represents a sign, or badge of origin. I do not think that the elements within it may be dissected or that they would be dissected by an ordinary consumer of goods within the relevant classes. In any event, I consider that the words “Bohemia Crystal” and “Made in Czech Republic” within the 701 mark tend to reinforce the descriptive, geographical signification of those words. ….

The third factor is the way that evidence was advanced did not help BCP’s case. A lot of the evidence was vague, or general, rather than specific to what needed to be proved here: use of the signs as trade marks before the filing date. In this respect, his Honour’s discussion will repay careful study as it is not uncommon to see evidence prepared for the Office suffering from similar problems.

Third, BCP did not demonstrate any sufficient reason why its trade marks should not be removed from the Register. Burley J accepted that, Host having established the marks were invalidly registered, BCP bore the onus of satisfying the Court that there was sufficient reason not to order cancellation.

Here, the evidence did not establish that BCP had acquired distinctiveness in its signs. Importantly, allowing BCP to keep its registrations would give it an unfair advantage. At [248], his Honour explained:

…. The presence of the existing ground of revocation via the operation of subsection 88(2)(a) and s 41 indicates an intention on the part of the legislature to ensure that historical registrations should not remain on the Register where they should not have been granted in the first place. In the present case, to permit such a course would advantage the unmeritorious registrant who has incorrectly had the benefit of the monopoly since the relevant dates. BCP is able to apply to register the Bohemia marks now, should it choose to do so.

Of course, if it were to do so, it would run the risk of other traders wishing to use the terms opposing (if the Registrar got suckered into accepting the applications in the first place).

Fourth, if his Honour had not found BCPs trade marks invalidly registered, Host would have infringed. Its attempt to rely on s 122(1)(b) would have failed. This part of the case essentially turned on Host’s use being BANQUET by Bohemia (emphasis supplied) rather than BANQUET from Bohemia.

Burley J accepted that s 122 could be invoked to protect trade mark use, not just descriptive use. However, Host’s form of use showed that Host was trying to assert origin in some particular trade source rather than some geographical origin. At [301]:

…. Ms Flint and Mr Sullivan adopted this language, notwithstanding the obvious difficulty with the perception of “by” and with no knowledge of either BCP or the Bohemia marks. However, I find that they did not do so for the purpose of using “Bohemia” to designate the geographical origin of the goods, but to designate the trade origin of the goods lying in a particular entity (which was ultimately Forincorp). Accordingly, the use does not fall within the defence ….

Fifth, BCP’s allegations of misleading or deceptive conduct also failed. A number of factors contributed to this including the particular trade marks BCP had actually used and the good old-fashioned Hornsby Building Information Centre proposition.[5] In contrast to the trade mark case, in addition, it was highly significant that Host’s market and BCP’s market were quite different. BCP’s market was member of the general public looking for premium quality products. Host’s customers, however, were cafes, restaurants, pubs, clubs, community groups and the like who were cost conscious but attended to their purchases with considerable care. So, for example, at [370]:

the typical reasonable consumer is most likely to perceive the October 2015 catalogue use to represent that the manufacturer or producer of the glassware is an entity known as “Banquet by Bohemia” or “Bohemia”, there is no more than a remote prospect that reasonable customers are likely to consider that the goods offered in the catalogue are offered with the sponsorship or approval of BCP or are offered by Host with the approval of BCP or that the Banquet products emanate from BCP. First, I do not consider that the typical Host customer who encounters this publication would be likely to be aware of BCP. Secondly, I consider that any Host customers who are aware of BCP would understand it to be a retailer of a range of glassware products sold under a range of different brands. Thirdly, to the extent that such customers perceive that BCP has a trade connection with products that it sells, those customers are likely to do so by reference to the common use of the 701 mark or the modified 701 mark. Without the presence of that mark, in my view they are unlikely to consider that the word “Bohemia” as it appears in the impugned uses connotes a connection or association with BCP. Needless to say, no such mark appears in the October 2015 catalogue. Fourthly, such customers would also be influenced by the geographical nature of the term and the material differences between the Host and BCP products such as price, quantity and quality. ….

Bohemia Crystal Pty Ltd v Host Corporation Pty Ltd [2018] FCA 235


  1. It also used BANQUET CRYSTAL BY BOHEMIA, CZECH CRYSTAL BY BOHEMIA and expressions like BANQUET FLUTE.  ?
  2. Given the filing dates of BCP’s trade marks, the original form of s 41 applied.  ?
  3. See also [153] – [155].  ?
  4. At [161], Burley J pointed out that PERSIA in the Persian Fetta case and Peking and Ceylon still retained their signification as place names.  ?
  5. If you are going to use a descriptive expression, you have to accept a certain degree of confusion is inevitable.  ?

Bohemia Crystal shattered Read More »

CLIPSO CLIPSAL-ed

You may not be surprised to read that Perram J has found that CLIPSO is deceptively similar to CLIPSAL for electrical goods in class 9. This had the consequence that Clipso’s registration for “CLIPSO” was expunged from the Register and CLIPSO itself was found to infringe prospectively. Clipsal’s trade mark registration for the shape of its ‘dolly switch’, however, was not infringed by Clipso’s products.

A significant issue in the case was whether Clipso’s principal, a Mr Kader, was to be believed about how he came up with the mark. Perram J found he was not. Perhaps the most interesting feature of the case, however, is the market by which the issues fell to be assessed.

Some background facts

Clipsal has registered CLIPSAL as a trade mark in respect of all goods in class 9. While it and its predecessors claim to have been using the mark since the 1920s, the registration it relied on in this proceeding dates from 1989. It currently markets some 14,668 electrical products under the trade mark and, in 2011, its annual sales exceeded $500 million. Clipsal had some 77% of the market; its nearest competitors having only 11% each. Clipsal also has a shape mark registered for the shape of its dolly switch:

Clipsal’s Dolly Switch trade mark

in respect of ‘electrical wiring accessories which incorporate a rocker switch … including dimmer switches….’

Mr Kader had been importing electrical accessories since about 2005. The CLIPSO mark came into use, however, in 2008 and Clipso achieved its registration in respect of a range of class 9 goods, principally electrical switches and the like, from October 2008.

The market by which deceptive similarity assessed

Many of Clipsal’s products, and most if not all Clipso’s, are what is known in the trade as ‘Bakelite’. These are (generally) plastic products such as switches, power points and other electrical products. A significant feature of these products is that by law they can be installed only by licensed electricians. Thus, a key plank of Clipso’s defence was the nature of its goods which, it said, were essentially bought by electrical wholesalers and electrical tradies, who were not confused by the two trade marks. CLIPSAL, it was argued, was so famous that no reasonable tradie would mistake CLIPSO for it.

Perram J began by noting trade mark authority had held that an infringer’s conduct fell to be assessed in light of its effect on ordinary purchasers of the products in suit. His Honour noted that misleading or deceptive conduct under the ACL fell to be assessed by reference to the ordinary and reasonable consumer.[1] Acknowledging that other cases may lead to different conclusions, however, in the context of this case Perram J considered that Clipso’s conduct fell to be assessed under all heads according to its impact on the ordinary and reasonable consumer.

Perram J accepted that a large part of the market for Clipsal’s products were electrical wholesalers and electrical installers. For many people having a home or office built, the issue was whether there were light switches, their positioning and number. The actual purchasing decision was left to the builder or contractor. However, Perram J found that there was a (relatively small) but not insignificant section of the general public who were interested in such matters and did take into account the trade source of the products that were being installed in their building and so specified the products they wanted their contractors to install, non-purchasing end-consumers.[2]

A key factor in his Honour’s conclusion on this point was the extent and length of Clipsal’s marketing efforts directed to the general public, not just the trade. In addition to the usual forms of advertising, this included a software program, Cipspec, which Clipsal installed in showrooms and its consultants used to work through with customers the placement and appearance of various CLIPSAL products. At [122] and [123] of his Honour’s reasons, Perram J accepted:

However, the evidence of these witnesses (the marketing director, Mr Quinn, a store manager of an electrical wholesaler, Mr Kalimnios and the electrical wholesaler, Mr Micholos) nevertheless persuades me that the applicants’ efforts in bringing end-consumers into the process as part of its supply chain strategy are likely to have had some success. The evidence of Mr Kalimnios and Mr Micholos (referred to later in these reasons) was attacked on the basis that the firm for which they worked, P&R Electrical, was not independent of the applicants. It is not surprising that an electrical wholesaler might have a substantive commercial relationship with the market leader in electrical accessories, but I would not describe such a relationship as lacking independence. In any event, I do not think that the evidence of either man was adversely affected by this matter.

One is left in the situation then that the only evidence of the success of the strategy of seeking to increase demand at the consumer end of the market is the existence of the strategy itself. Although I am prepared to accept that some end-consumers do indeed purchase switches and sockets themselves, I do not accept that generally these are the same people who are involved in, or the targets of, Mr Quinn’s supply chain strategy. As best I can surmise, they are instead a small group of people who decide to buy Bakelite products to have an electrician install them, or possibly even a smaller group of unlawful renegades who buy Bakelite products to install themselves.

His Honour was unable to quantify how significant the involvement of such end-users in the market was, but at [129] considered it was not de minimis:

… one is still left with little compelling evidence that any of the end-consumers targeted by the strategy exist beyond the strategy itself and the amount spent on it. I have no particular difficulty describing the strategy as plausible. One can well see that there are likely to be some people who care very much about what the light switches and sockets installed in their homes are to be, whilst there will be others who are benignly indifferent. Amongst the first class, it requires no great mental athleticism to see that their fascinations are likely to be with the Bakelite products at the premium end of the market. Can I infer from these observations that such a class exists and in numbers which are significant? I believe that I can and I do. The widespread fascination with home renovations in some quarters is reflected in the programming that appears on popular television every week. I do not believe that Mr Quinn’s strategy of creating demand and driving it back up the supply chain is some quixotic venture which is pointless. To the contrary, I am prepared to infer that a significant portion of persons building a new house or renovating an existing dwelling do care about which Bakelite products are used.

It was not necessary that these end-users be the people who actually bought the goods in question; it was sufficient that they gave instructions for them to be purchased such as through their contractors. The size of this segment of the market was sufficient to qualify as ‘substantial’. The relevant market, therefore, was a segmented one consisting of electrical contractors, electrical wholesalers and ‘non-purchasing’ end-consumers.

One consequence of this conclusion was that Perram J considered the parts of the market consisting of electrical contractors and wholesalers was a specialised market which would require expert evidence about the conduct and purchasing habits of people in those trade channels. That was not be the case for that part of the market comprised of end-users.

For that part of the market, Perram J went on to hold that CLIPSO was deceptively similar to CLIPSAL. Perram J considered that the two words shared the same root and had very similar pronunciation – the primary stress would fall on the first syllable and the final syllable of both words would be unstressed. There was also expert evidence that some people might perceive CLIPSO as an hypocristic” for CLIPSAL.[3]

As noted above, Clipso argued that CLIPSAL was so well-known in the trade that there would be no confusion. Perram J rejected this on several grounds. First, in the context of s 44 resort could not be had to reputation except where the mark was so well-known as to be ubiquitous and, notwithstanding its market penetration, Perram J was not prepared to find CLIPSAL fell into that exceptional category.[4] Secondly, as his Honour had already held, the market was not limited to those in the trade but also included ordinary (non-purchasing) consumers. Thirdly, there was in any event evidence from people in the trade (well, at least one) that, while they were not necessarily confused, they were caused to wonder whether there was some connection between the two trade marks.[5] Consequently, CLIPSO was deceptively similar to CLIPSAL even for the segments of the market comprised of those in the trade.

Cancellation

These findings together with Perram J’s rejection of Mr Kader’s claims about how he chose the name CLIPSO meant that the CLIPSO registration was cancelled pursuant to s 44, s 60 and s62A.

Mr Kader had claimed that he chose the name while leafing through the list of goods in class 9 in the International Classification and noticing some references to “clips”. He also claimed that he knew very little if anything about CLIPSAL when he applied to register CLIPSO. Perram J found Mr Kader was lying about this based on a number of factors including the strength of Clipsal’s position in the market, Mr Kader’s involvement in the market for at least 3 years and, amongst other things, the fact that each day his trip to work involved passing a very large CLIPSAL hoarding.

Infringement

As s 122(1)(e) provides a defence to trade mark infringement when the sign used is itself a registered trade mark and is being used in respect of the goods for which it is registered, Clipso could not in fact infringe until Perram J’s orders cancelling the registration of CLIPSO were effected on the Register. Therefore, injunctions only would be available.

However, Perram J did go on to find that Clipso’s use of CLIPSO also contravened the prohibitions on misleading or deceptive conduct under the ACL and passing off, but only insofar as the public consisted of (non-purchasing) end-consumers. As Perram J considered those actually engaged in the trade would not be misled or deceived, but only caused to wonder if there was a connection, there was no contravention in respect of those segments of the market.

Use of a shape trade mark

Perram J found that Clipso’s dolly switch very closely resembled Clipsal’s dolly switch which was depicted in its registered trade mark. Nonetheless, his Honour considered Clipso did not use its dolly switch as a trade mark. Perram J accepted that there were many shapes a dolly switch could take so that Clipso’s dolly switch was not dictated by function. Nonetheless, it was not used as a trade mark. At [154], his Honour explained:

Be that as it may, I still do not think that the first respondent was using the switch as a trade mark. Generally speaking, Clipso products were packaged in plastic sleeves emblazoned with the Clipso logo, and then placed in a cardboard box also emblazoned with the Clipso logo. There is no doubt that the word CLIPSO was being used as a badge of origin, which rather detracts from the idea that the switch located within the packaging could also have been operating as a badge of origin.

Perram J was not prepared to find that the shape of the dolly switch itself conveyed an association with Clipsal based on the sheer volume of sales of the product. This was so even though Clipsal’s packaging often included a statement that “The shape of this dolly switch is a trade mark of [Clipsal]”.

Clipsal Australia Pty Ltd v Clipso Electrical Pty Ltd (No 3) [2017] FCA 60


  1. Perram J noted that there could be subtle differences also between passing off and the ACL, but it was sufficient to proceed in this case on the basis that the same test applied for both actions notwithstanding their different bases.  ?
  2. There were also end-consumers who actually bought the products themselves, but they were considered too small a segment to qualify as ‘substantial’.  ?
  3. Apparently, this refers to the practice, particularly prevalent amongst Australians, of modifying words colloquially to suggest familiarity such as “kiddo” for “kid”.  ?
  4. Bridling at [179] – [180] against even that scope for reputation permitted by Henscke.  ?
  5. Relying on the Full Court in Vivo v Tivo.  ?

CLIPSO CLIPSAL-ed Read More »

$3 million!

Last year, we looked at the ACCC’s successful prosecution of Valve (provider of the online gaming platform, Steam) for breach of the consumer guarantees in the ACL. Valve’s contracts for example provided that all fees were payable in advance and not refundable. Valve’s main line of defence was that it was in the US state of Washington and so not bound by the ACL.

On 23 December 2016, the Court fined Valve $3 million for its breaches: $2.2 million for the contraventions involving the Steam Subscriber Agreement and $800,000 for the contraventions involving the Steam Refund Policy.

This was in a context where, while,the number of accounts developed over the 3 year period of the misconduct, Valve had some 2.2 million Australian accounts (I.e, about $1.36 per account) and had received communications about refunds from over 21,000 accounts. What is more, despite its no refunds policy wording, it had actually paid refunds to some 15,000 accounts. Another factor was Valve’s high-handed approach to its legal position in Australia; apparently deciding it had no liability as a matter of policy without reference to Australian legal advice.

Australian Competition and Consumer Commission v Valve Corporation (No 7) [2016] FCA 1553 (Edelman J)

$3 million! Read More »

Pacific (f)ale

Moshinsky J has rejected Stone & Wood’s attempt to block Thunder Road Pacific Ale and, instead, ruled that Stone & Wood made unjustified threats of trade mark infringement.[1]

In 2010, Stone & Wood renamed its Draught Ale product as Stone & Wood Pacific Ale. Stone & Wood has 3 other main products in its line up of beers, but the Pacific Ale makes up some 80 – 85% of its sales. These sales were mainly in the Northern Rivers area of NSW, south eastern Queensland, Sydney and Melbourne.

Pacific Ale was a name Stone & Wood coined for its product. At the time, Stone & Wood was based in Byron Bay and ‘Pacific’ was chosen partly to reflect Byron Bay’s location on the Pacific ocean and partly for its ‘calming, cooling emotional response’.

The second respondent, Elixir,[2] also started up in 2010, in Brunswick, Melbourne Victoria, which some people might consider far from the Pacific. One of its lines of beers is its Thunder Road range. In 2015, it added a Thunder Road Pacific Ale to that range.

misleading or deceptive conduct / passing off

This is what individual bottles of the competing products looked like:

image002

image004

The Thunder Road logo is on the label around the neck. This is what a six pack of each looked like:

image006 image008

Stone & Wood contended that Elixir’s use of Pacific Ale and/or the ‘similar’ green and orange colour scheme misrespresented that the Thunder Road product was Stone & Wood’s or in some way associated with it in contravention of s 18 or s 29 of the ACL or a passing off.

The essential problem with this type of claim is that whether or not there is a real possibility of misrepresentation falls to be determined in all the circumstances. What would the ordinary consumer of the relevant products think in all the circumstances. Moshinsky J’s reasoning is much more detailed than I am going to attempt here, but notwithstanding the large and prominent display of Pacific Ale on Elixir’s product:

  • the dominant element on Stone & Wood’s packaging and get-up was its name: Stone & Wood;
  • there was no use of Stone & Wood on the Thunder Road product;
  • the words Pacific Ale on the Elixir product was very closely associated with Thunder Road, itself a well-known brand amongst the discerning hipsters and others in the market for craft beers;
  • although Pacific Ale was not a technical ‘style’ recognised at beer shows, it had become by the time Elixir introduced its product, descriptive for many consumers of a beer made from Galaxy hops, a particular Australian variety which gave the beer a fruity or tropical flavour – this was reinforced by the reasons why Stone & Wood had adopted the name in the first place;
  • the colour schemes and get-up are, shall we say, pretty different.

Moshinsky J accepted that Elixir knew full well that Stone & Wood had a Pacific Ale product when it decided to launch its own Pacific Ale and was trying “to some extent” to take advantage of consumers’ recognition of the term Pale Ale. That was not the same thing, however, as trying to take advantage of the name Stone & Wood or trick people into thinking the Thunder Road product was the Stone & Wood product which was what Stone & Wood needed to show.

Stone & Wood also deployed expert evidence from the marketing expert, Professor Lockshin.[3] Prof. Lockshin argued that marketing theory posited consumers might have come to identify Stone & Wood’s product just by the sub-brand Pacific Ale. Moshinksy J was not prepared, however, to overlook the significance of the prominent use of Stone & Wood on Stone & Wood’s products and the other differences between the products in the absence of testing which showed how consumers actually reacted.

In an attempt to repeat Bodum’s rather surprising success against Euroline, Stone & Wood pointed to a blackboard in a bar which simply listed PACIFIC ALE as one of the beers on tap; the beer of course being Thunder Road, not Stone & Wood. Moshinky J was not prepared to infer that patrons ordering the beer from that listing were necessarily trying to order Stone & Wood Pacific Ale as opposed to a pacific ale. Also, Elixir should hardly be liable for the actions of an independent bar owner.

Trade Mark infringement

Stone & Wood has a trade mark, No. 1395188, registered in class 32 for beer:[4]

image012

The problem Stone & Wood confronted with its infringement case is that Pacific Ale is such a subsidiary feature of the trade mark. Moshinsky J was not prepared to find that the words Pacific Ale in that configuration were likely to be an essential feature of the mark. His Honour considered that the Crazy Ron case required him to assess the essentiality of a feature in the context of the trade mark as a whole. It would have been wrong to focus on part of the mark in isolation only.

Groundless threats

Section 129 provides someone threatened with an action for trade mark infringement to bring proceedings for unjustified threats. A declaration that the threat was unjustified can be obtained, injunctions against repetition and, if damage be suffered, damages.

The Trade Marks Act is rather curious in that it is a defence to such an action if the trade mark owner starts proceedings for infringement “with due diligence”, even if the infringement allegation ultimately fails.[5] Moshinsky J denied Stone & Wood’s reliance on this defence in this case.

Stone & Wood had sent a letter of demand which included allegations of trade mark infringement as well as misleading or deceptive conduct, and threatened proceedings. When the correspondence did not lead to a resolution of the dispute, it started proceedings against Elixir, but only for misleading or deceptive conduct / passing off. It did not bring proceedings for trade mark infringement. It only brought the infringement proceedings by way of amendment after Elixir cross-claimed for unjustified threats.

In that respect, Moshinsky J distinguished Stone & Wood’s position from the trade mark owner in the Montana case. There, Wilcox J had rejected reliance on the ‘with due diligence’ defence, but the Full Court overturned that on appeal. In Montana, TTS did bring the infringement proceedings by way of cross-claim. However, it did not start the proceedings with a misleading or deceptive conduct claim. Montana started the earlier proceedings with its claim against unjustified threats and TTS brought the cross-claim at the first available opportunity.

The matter will continue to ascertain whether Stone & Wood will have to pay any damages.

It is tempting to wonder whether Stone & Wood would have had more success if it had promoted Pacific Ale more prominently and independently of its name, Stone & Wood. Perhaps, but these types of sign are slippery and it doesn’t take much for them to slide into descriptiveness. CAPLETS, for example, was a coined word, but not infringed.

If you have a comment or a question, please feel free to post it in the comments section. Or, if you would prefer, email me.

Stone & Wood Group Pty Ltd v Intellectual Property Development Corporation Pty Ltd [2016] FCA 820


  1. His Honour’s reasons run for some 95 pages or 245 paragraphs, so I am not going to try and convey all the nuances which were explored before his Honour in a blog post such as this.  ?
  2. The operation is sufficiently crafty, or un-boutiquey, that the first respondent is the holder of the group’s intellectual property rights.  ?
  3. If his name sounds familiar, that is because he was unsuccessfully deployed by Henschke in the Hill of Grace case.  ?
  4. It also has a pending application for PACIFIC ALE, but that has been opposed by, you guessed it, Thunder Road.  ?
  5. Dowsett J has recently pointed out that the patents legislation used to have this defence, but it was repealed a long, long time ago.  ?

Pacific (f)ale Read More »

Nappyland, Nappy Land and napplyland.com.au

Flick J has provided a timely reminder that a registered trade mark does not always trump common law rights in passing off or under the Australian Consumer Law, in finding that Nappy Land and nappyland.com.au passed off Nappyland’s rights in NSW.

Mr Ngo and Mr Ho (through his company Powerware) started off in business together in 1997 as Nappy Land in New South Wales. Mr Ho also incorporated National Australian Nappies in 1997.  Mr Ngo and Mr Ho fell out in 1999 and Mr Ngo seems to have bought out Mr Ho’s share in Nappy Land when Mr Ngo and his wife became the owners of the business name in NSW. They appear to have carried on the business in NSW through his company CI JI Family. At some point, CI JI Family started using the following (unregistered) trade mark:

get_tmi_image-1.pl

By late 2000, Mr Ho through National Australian Nappies had registered Nappy Land as a business name in Victoria and appears to have been trading throughout Australia except NSW. From February 2002, National Australian Nappies secured registration of TM 902900

get_tmi_image.pl

It seems like Mr Ngo and Mr Ho had very different views about who bought what when their partnership came to an end. Be that as it may, there doesn’t appear to have been any real dispute that Mr Ngo and CI JI Family were operating throughout the period in NSW as effectively Nappyland or that National Australian Nappies was operating outside NSW as Nappy Land.

At some point, it appears in or about 2013, however, National Australian Nappies, started attempting to enter the market in NSW. CI JI Family and Mr Ngo sued seeking interlocutory relief, but secured a speedy trial instead.

National Australian Nappies and Mr Ho sought to rely on their registered trade mark to fend off the action on the basis that s 20 of the Trade Marks Act confers on the owner the exclusive right to use the trade mark as a trade mark in Australia for the relevant goods/services. (Section 122(1)(e) also provides a defence to trade mark infringement.) However, s 238 s 230 (of course; thanks: Tim Golder) provides:

Passing off actions

             (1)  Except as provided in subsection (2), this Act does not affect the law relating to passing off.

             (2)  In an action for passing off arising out of the use by the defendant of a registered trade mark:

                     (a)  of which he or she is the registered owner or an authorised user; and

                     (b)  that is substantially identical with, or deceptively similar to, the trade mark of the plaintiff;

damages may not be awarded against the defendant if the defendant satisfies the court:

                     (c)  that, at the time when the defendant began to use the trade mark, he or she was unaware, and had no reasonable means of finding out, that the trade mark of the plaintiff was in use; and

                     (d)  that, when the defendant became aware of the existence and nature of the plaintiff’s trade mark, he or she immediately ceased to use the trade mark in relation to the goods or services in relation to which it was used by the plaintiff.

The fact of the trade mark registration therefore provided no protection against either the passing off or ACL claim. Despite aspects of the evidence being less than satisfactory, Flick J held there was sufficient evidence that the public in NSW was being misled or deceived and so s 18 of the Australian Consumer Law was contravened and there was a passing off.

His Honour went on to award damages of $25,000 as an exercise in “judicial estimation” rather than impermissible “imagination” with further orders to be decided at a later hearing. Presumably, unless bought out, CI JI Family will seek injunctions to stop further use in NSW of Nappy Land unless some form of disclaimer can be arrived out which prevents the misrepresentation. We shall have to wait and see.

CI JI Family Pty Limited v National Australian Nappies (NAN) Pty Limited [2014] FCA 79

Nappyland, Nappy Land and napplyland.com.au Read More »

The power of a registered trade mark

If you have tried to buy, sell or rent property in Australia in the last 10 years (at the least!), like some nearly 7 million other Australians you have no doubt come across realestate.com.au, the web-portal run by REA Group. Real One also competes in that space.[1]

Bromberg J has held that Real One’s logos:

Real One 2nd logo
Real One 2nd logo

Real One 1st logo
Real One 1st logo

did not “pass off”[2] REA Group’s logos:

559.1

Nor did they infringe REA Group’s registered trade mark: [3]

TM No 1478263
TM No 1478263

However, the use of Real One’s URL in ads like this:

Real One Ad
Real One Ad

did infringe the registered trade mark! [4]

Bromberg J held that the uses both in the first line and the second line of the advertisment infringed. In contrast to his Honour’s rejection of the claim for misleading or deceptive conduct, Bromberg J explained at [241]:

In my view, the display of the term “realestate1.com.au” in the heading of a sponsored link would have been regarded by many consumers to be the trading and domain name of the business whose link it was. One of the central distinguishing features of REA’s realestate.com.au trade marks is the idea that the term “realestate.com.au” is both a brand name and a domain name at the same time. When Real Estate 1 used “realestate1.com.au” as a trading name, it took up that precise idea. In that context consumers are likely to pay substantive attention to “.com.au” because it serves the function of identifying the brand whose domain name is also being used as a brand. The whole of the domain name is likely to be read or at least scanned. In a circumstance such as that, there was in my view, a real danger of confusion on the part of a consumer familiar with REA’s realestate.com.au trade marks. That principally arises because in a scanning process of the kind which can occur on a search results page, the “1”, which is not very distinct in the context of a domain name in ordinary type face, is likely to be missed by some consumers.

First, his Honour distinguished Perram J’s proposition in the Solahart case that usually one can ignore the inclusion in a sign of elements like “www” and “.com.au” as merely “accoutrements” of the domain name system and so not matters that the public would pay attention to. Unlike the situation before Bromberg J, however, that observation was not made in a context where the .com.au element formed part of the registered trade mark.[5]

Second, I can certainly see that the bold “headline” (the first line) in Real One’s advertisment is plainly being used as a trade mark. But the use in the second line???

Yes, I know that cases have held that domain names / URLs are the Internet’s equivalent of a sign or billboard. That can certainly be true and, in the first line of the advertisement, the URL is plainly being used in that way, but surely with respect in the second line the URL is no more than an address.

Third, one might express some alarm that anyone can stop someone else using the term “real estate” (in connection with real estate services). There are, after all only 387 other registered trade marks in class 36 alone which include the words “real estate”. On the Internet, there is also at the least realestateview.com.au. Bromberg J’s first answer in [241] above is that it was not just the use of “real estate” that gave rise to liability: it was the use of that term and “.com.au” in combination and the comparative insignificance of the “1” in Real One’s URL.

Bromberg J did, however, recognise the problem and said at [247]:

As my conclusions demonstrate, registration of REA’s realestate.com.au marks has effectively given REA a monopoly over two highly descriptive terms when used in combination. Those terms are likely to be the most common terms on a search results page where a search has been conducted for a residential real estate portal. The protection conferred by REA’s trade marks over the use of “realestate” and “.com.au” in combination, provides REA with a monopoly over the term “realestate” in circumstances where its rivals seeking also to use “realestate” or a close variant thereof as a second-level domain, do not forego the advantages of using “.com.au” in their domain names. The natural advantage of a domain name which incorporates “realestate” to the commercial success of property portals will be apparent from observations I have already made. There is also a natural advantage in the use of the suffix “.com.au”. It is troubling that terms that are highly descriptive of a particular area of commerce and which provide significant commercial advantage should not be readily available for use by all who seek to participate in that commerce. However, in the absence of a successful challenge to the registration of REA’s realestate.com.au trade marks, whilst that may be troubling, REA is nevertheless entitled to the protection of the monopoly which has been conferred upon it.

The question has to be asked, however, on what basis could REA group’s logo be revoked or refused registration? Given the device elements (and the large number of other, competing devices), it would surely be held to be capable of distinguishing. The “good” old days (i.e., before the 1995 Act) were at least better in this respect: the Registrar could impose disclaimers to ensure these sorts of monopolies should not arise.

Two short points in conclusion:

His Honour did also find that Real One’s “real commercial” logo infringed REA group’s registration for its “real commercial” logo.

It would seem that Real One is still able to operate from its “.net.au” URL.

REA Group Ltd v Real Estate 1 Ltd [2013] FCA 559


  1. Bromberg J found at [258] that the principal of Real One adopted the name to pressure REA group into buying him out at some point, but also went on reluctantly to find no accessorial liability (akin to authorising).  ?
  2. For simplicity, I will treat that term as covering the actions for misleading or deceptive conduct (now under s 18 of the ACL formerly known as s 52 of the Trade Practice Act 1974) which, of course, was really the focus of that part of the case.  ?
  3. The number doesn’t seem to be identified, but TM Nos 811931 and 1075935 are for the mark in black and white and TM No. 1478263 is for the colour version reproduced in his Honour’s reasons.  ?
  4. Also contrast this result with the Thredbo Resort’s failure to stop ThredboNet using Thredbo in domain names to market rental accommodation at Thredbo village: Kosciuszko Thredbo Pty Limited v ThredboNet Marketing Pty Limited [2013] FCA 563 – Thredbo Resort having only pending opposed applications.  ?
  5. Decision under the UDRP have reached similar positions.  ?

The power of a registered trade mark Read More »

Winnebago loses half an appeal

The Full Court has partially allowed an appeal from Foster J’s decision to order Knott Investments to stop using the Winnebago trade marks for “campers” or RVs not made by Winnebago. As a result, Knott can continue to use “Winnebago” if it can make it clear it is not associated with the Winnebago company.

Some facts

From about 1959, Winnebago had been making and selling its RVs under that brand name in the USA and eventually other countries including the UK and Canada, but not Australia.

Winnebago logo
Winnebago logo

In the early 1960s, Binns became aware of the Winnebago name and logo while travelling around the USA. In 1978, Binns and his wife started manufacturing and selling their own RVs in Australia under the name “Winnebago” and using the Winnebago logo. In 1982, they incorporated Knott which then took over running their business.

The Winnebago company discovered what Knott was up to by 1985. However, the Winnebago company did nothing about this until 1992 when the parties entered into a “settlement” agreement. Following this, Knott kept making and selling its own Winnebago brand RVs and registered the Winnebago logo as trade marks. Winnebago itself did nothing further until 2010, when it wished to enter the market in Australia and started proceedings alleging misleading or deceptive conduct, passing off and seeking revocation of Knott’s trade mark registration for Winnebago and the logo.

When do you test whether conduct is misleading or deceptive

The Full Court allowed Knott’s appeal insofar as it related to when Knott’s conduct had to be tested as misleading or deceptive. Foster J held this was in 1982 when Knott was recorded in the Register of Business Names as having commenced running the business, there being no formal documentation of a transfer of the business. The Full Court, however, considered that Knott was plainly the successor in title to the Binns’ business and so the relevant time was 1978, when the Binns started up.

This is important because the Full Court unanimously considered the relevant time to assess whether conduct is misleading or deceptive under s 52 of the TPA (as it was) and s 18 of the ACL (as it now is) is the date when the “infringer’s” conduct started, not some later date.

As it turned out, however, this did not help Knott much as the Full Court considered the evidence clearly established Winnebago had a “spillover” reputation in Australia in 1978 even though it had not traded in Australia at that point.[1] Therefore, Knott (and the Binns’) conduct was likely to mislead or deceive.

Estoppel, laches, acquiescance or delay

The issue that loomed large in the Full Court’s eyes was Winnebago’s delay in bringing proceedings to enforce its rights – 25 years after it first learned of Knott’s activities and 18 years after the “settlement” agreement. Over that period of time, Knott had built up its own substantial reputation in “Winnebago” in vehicles of its own manufacture.[2]

First, the Full Court agreed with Foster J that the “settelment” agreement did not authorise or concede any rights to use “Winnebago” to Knott. Clause 6 provided:

This Agreement does not address, impact upon, or relate in any way, manner or form to the use or ownership of the [Winnebago marks] in Australia or to any rights relating to the [Winnebago marks] based on reputation or use under any statute or at common law in Australia. By entering into this Agreement, Winnebago does not expressly or impliedly acknowledge that Australian Company has any rights of any nature whatsoever to the [Winnebago marks] in Australia. To the extent not expressed in this Agreement, this Agreement shall be without prejudice to the rights of Winnebago and Winnebago expressly reserves all of its legal rights.

Knott argued, however, that the 18 year delay in bringing proceedings meant it was unjust to permit Winnebago to bring proceedings now. Allsop J despatched this argument for six:

First, there was no clear representation, arising either out of the Settlement Agreement or from the conduct. The terms of the agreement, in their context, contained a degree of commercial ambiguity. The terms, however, of cl 6 could leave no doubt in Mr Binns’ mind that any practical confidence in him that Winnebago was not going to sue him was not based on any right conceded by Winnebago. He proceeded at his own risk. The finding by the primary judge at [155] of the reasons (not specifically challenged) that Mr Binns knew there was a risk of having to rebrand his product if Winnebago entered the market is also fatal to the submission. (emphasis supplied)

Allsop CJ and Jagot J rejected Knott’s arguments based on laches, acquiescance and delay both for similar reasons and because Knott had expressly disclaimed them at trial.

Notwithstanding this, the Full Court considered that Foster J’s order that Knott be restrained from using the Winnebago trade marks was unjust. Even though Knott (or, really, Binns) had adopted the Winnebago trade marks to take advantage of the Winnebago company’s reputation and there was evidence that some members of the public had been misled, nonetheless, Knott had over decades built up its own substantial, independent reputation. Instead, therefore, the injunction should only prohibit use which did not appropriately disclaim any trade association with the Winnebago company. At [67], Allsop CJ explained:

This limitation of relief can be seen to reflect not only the balancing of the respective interests of Knott and Winnebago in the reputation developed by Knott’s expenditure, in the context of Winnebago’s extraordinary (and informed) delay, but also the erosion of the reputation of Winnebago ….

and

The evidence reveals sufficient to conclude that at least some of Knott’s reputation in the use of the name and marks was the development of its goodwill and reputation; that not all of the development of its business involved the taking advantage of Winnebago’s reputation in Australia. In normal circumstances, this would not matter; it would be something that the party passing off would have to accept as a consequence of its wrongdoing. Here, however, Winnebago has contributed to this by standing by, informed of the position, for 25 years while Knott expended money and built a business, part at least of which was its own reputation. (emphasis supplied)

The disclaimer or dissassociation had to be clear on the vehicles Knott made in future as well as in its advertising and promotional material.

The third member of the Court, Cowdroy J, did not explicitly reject the laches or acquiescance defence, but agreed in the approach of Allsop CJ saying at [106]:

the Court considers that the granting of relief to completely restrain the appellants from the use of the Winnebago marks to be unreasonable in light of the substantial delay by Winnebago.

Finally, the Full Court upheld Foster J’s order to cancel Knott’s registration of the Winnebago trade marks. Knott had registered these in direct contravention of the terms of the “settlement” agreement.

Some thoughts

In 1992, a representative of the Winnebago company had written to its then Australian lawyers explaining:

… While we are obviously interested in persuading or compelling Mr Binns to cease using the subject marks in Australia, I really do not think that we can justify any additional expense. We are not selling our products there nor do we have any plans to do so. There has in the past been some indication that Mr Binns was experiencing some financial duress and perhaps with any luck he will go broke. In any event, at least for the time being, I think we will just continue to monitor this situation … [3]

No doubt, the sentiments will resonate with everyone advising a foreign brand owner in Australia. The Full Court’s approach may provide a warning. The terms of the “settlement” agreement were sufficiently limited to preserve the Winnebago company’s right to enter the market and object to misrepresentation of association, but failure to enforce its rights promptly has left it encumbered with a competing, independent user of its brand. On the other hand, Knott did not bring matters to a head in negotiating the “settlement” agreement and finds itself constrained. As Allsop CJ said, it ran the risk. How the disclaimer should be effected is unclear, but there are indications in Allsop CJ’s reasons that Knott has been able effectively to dissociate its business from the Winnebago company, while still using the Winnebago trade marks, since 2003.

Knott Investments Pty Ltd v Winnebago Industries, Inc [2013] FCAFC 59


  1. Nothing controversial in the principle: see ConAgra v McCain [1992] FCA 159; 33 FCR 302, although successful cases are still relatively rare.  ?
  2. For example, Foster J referred to Knott spending over $6million in advertising expenditure between 1992 and 2010.  ?
  3. See [114] of Foster J’s reasons at first instance.  ?

Winnebago loses half an appeal Read More »

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