LAWS3248: Intellectual Property 2 - Trademarks Summary Notes

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Table of Contents Class 1 - Introduction to Trade Marks and the Protection of Trade Reputation; Passing Off and Consumer Protection Legislation (Part 1)........................................................................................ 4 Casebook Readings...................................................................................................................... 4 Chapter 14 - Trade Marks, Passing off and Protecting Trade Reputation: History, Justifications and Context.............................................................................................................................. 4 Current Context........................................................................................................................ 7 Passing Off and Consumer Protection Legislation........................................................................8 Tests for passing off and contravention of consumer protection legislation.............................8 Reputation.............................................................................................................................. 10 Extra Cases................................................................................................................................ 14 Class 2 - Passing Off and Consumer Protection Legislation (Part 2)..............................................16 Location of reputation............................................................................................................. 16 Spillover reputation................................................................................................................ 16 Temporal considerations......................................................................................................... 17 Ownership of goodwill............................................................................................................. 18 Misrepresentation or misleading or deceptive conduct..............................................................19 The relevant standard: Is mere confusion sufficient...............................................................20 Other Preliminary Issues......................................................................................................... 20 Types of misrepresentation: Origin............................................................................................ 21 Misrepresentations involving descriptive words.....................................................................21 Misrepresentations involving copying descriptive get-up.......................................................21 Misrepresentations involving copying product appearance....................................................22 Types of misrepresentation: Quality........................................................................................... 23 Types of misrepresentation: Inverse Passing off........................................................................24 Types of misrepresentation: Sponsorship, endorsement or affiliation........................................25 Damage..................................................................................................................................... 28 Types of Damage.................................................................................................................... 28 Damages and Remedies......................................................................................................... 29 Extra Cases................................................................................................................................ 30 Class 3 and 4 - Introduction to Registered Trade Mark Law; Distinctiveness and other Absolute Grounds of Rejection..................................................................................................................... 31 Definitions.................................................................................................................................. 31 Procedural Issues....................................................................................................................... 33 Application for registration..................................................................................................... 33

Examination............................................................................................................................ 33 Acceptance and opposition..................................................................................................... 34 Registration, renewal and loss of rights.................................................................................. 35 Examination, opposition and cancellation grounds....................................................................35 Absolute Grounds....................................................................................................................... 36 Distinctiveness........................................................................................................................ 36 Assessing inherent adaptation to distinguish: Particular examples........................................38 Other Absolute Grounds......................................................................................................... 46 Class 5 - Conflicts with earlier registered marks or applications for registration; Infringement and Defences....................................................................................................................................... 51 Relative grounds........................................................................................................................ 51 Section 44............................................................................................................................... 51 Other Relative Grounds........................................................................................................... 56 Ownership............................................................................................................................... 58 Conflict with geographical indication...................................................................................... 61 Registered Trade Marks: Infringement, Defences, (Loss of Rights and Exploitation)..................61 Infringement........................................................................................................................... 61 Class 6 - Defences to Infringement; Loss of Rights and Exploitation............................................71 Defences.................................................................................................................................... 71 Use of a person's place of business........................................................................................ 71 Consent of the registered owner............................................................................................. 72

Class 1 - Introduction to Trade Marks and the Protection of Trade Reputation; Passing Off and Consumer Protection Legislation (Part 1) Casebook Readings Chapter 14 - Trade Marks, Passing off and Protecting Trade Reputation: History, Justifications and Context Introduction
?? ? ?There are two main legal mechanisms by which the law provides legal protection to traders in respect of the marks and other indicia they use to distinguish their G&S from other traders o The first is the tort of passing off, as supplemented by provisions of consumer protection legislation - these prohibit parties from engaging in misrepresentations or misleading and deceptive conduct by adopting other traders signs/indicia o The second is the system of registered trade mark protection under the Trade Marks Act 1995

History of passing off and trade mark protection Origins of Passing off?

The tort of passing off has its origins in the British common law action for deceit - courts providing a remedy for traders whose name or symbol was adopted by another with the intention of inducing customers to believe its goods were in fact those of the first o The rationale behind this being a 'fraud on the public' o This came to be called the tort of passing off, underpinned by the fundamental element of fraudulent misrepresentation (Perry v Truefitt) By the early 19th century the Courts of Chancery also heard similar actions and were able to grant injunctions, but only where a legal right existed. The basis of this action was fraudulent conduct until in Millington v Fox the LC granted an injunction without fraud. Over time the Chancery courts came to articulate the view that equity' intervention in cases of this type were based on the plaintiff's property rights in the mark itself

Modern form of the tort of passing offThe idea that a mark constituted a form of legal property was important historically. But in the context of passing off it had very little impact because the CL courts had a different idea of what was protected by the tort of passing off and it was only at that time did the modern action take its form.

Erven Warnink BV v J Townsend & Sons (Hull) Ltd [1979] AC 731

Lord Diplock noted the judgment of Reddaway v Banham which denied that an action for passing off protected a proprietary right in the mark and that this expanded the actions to misrepresentations as to thinks like trade names and other indicia - this case was a classic case of misrepresenting one's own goods as the goods of someone else.

It was only in AG Spalding & Bros v AW Gamage that Lord Parker identified the right which is protected by an action of passing off is the 'property in the business or goodwill likely to be injured by the misrepresentation'. Goodwill being defined as 'the benefit and advantage of the good name, reputation and connection of a business. It is the attractive force which brings in custom' The goodwill of a manufacturer's business could be injured by someone else who sells goods who are correctly described as being made by that manufacturer but being of an inferior class of quality - in AG Spalding this was held to be actionable and the extension to the nature of the misrepresentation which gives rise to a right of action in passing off which this involves was regarded by Lord Parker as a natural corollary of recognizing that what the law protects by a passing off action is a trader's property in their business/goodwill. The significance of this was that passing off lay in the recognition that misrepresenting someone's goods as someone else's was not a separate genus of wrong but a particular species of wrong included in a wider genus.Fraud still has a continuing role to play in the action of passing off in Australian law

Origins of registered trade mark law
? At the same time that Chancery courts viewed that the action of passing off protected a form of property in the mark itself, the UK parliament was taking steps to provide further protection for trade marks o The Merchandise Marks Act did so and defined 'trade mark' broadly o This was followed by pressure to adopt a system of registered trade marks as one had exist in France and eventually this occurred
? Even though analogies were drawn to property rights, trade marks didn't have all the characteristics of forms of property o The Act contained an express restriction on TMs being assigned separately from the goodwill of the business in which it was used (as did the CL) o Explicit recognition of rights in the mark itself as a form of property meant that the action for trade mark infringement differed from passing off since it didn't require a plaintiff to demonstrate any trading goodwill or reputation - proprietorship in the TM was enough o Also a registered TM was infringed just by its use irt specified goods - one didn't have to show that the defendant's use conveyed a misrepresentation. However, rights were interpreted strictly (e.g. Hargreaves v Freeman - RTM for tobacco not enough to cover the mark on cigars)
? The AU Act which followed was slightly broader, allowed more marks to be registered and made it clear that it was an infringement so long as the used mark was 'substantially identical with the TM or so nearly resembling it as to be likely to decieve'

?Following some new Acts in the UK and AU, the immediate predecessor of the current regime was in force and TM law in AU developed such that: o Both a mark and a trade mark were defined o The register was divided into different parts to categorize marks capable of becoming distinctive o Applicants could register their marks in respect of services as well as goods o Registration only lasted seven years, but could be renewed o Provisions were in place to allow a registered TM to be removed on the basis of nonuse; and o The exploitation of registered TMs was more straightforward as marks could be assigned separately from the goodwill of the underlying business and could also be licensed The CB writers note: o That though the TM system was not a statutory re-enactment of 'passing off' - they share a close relationship. Initially the registration system made it easier to enforce rights. The tort of passing off expanded to provide broader protection too and these fed into further expansion of TM law and continued to loop as such o Further, care has to be taken when considering claims that 'preventing consumer confusion' is what underpins the action of passing off - the true essence of it is that the defendant engaged in conduct misleading consumers
? The HCA in Compomar v Nike recognized that AU RTM statutes have always tolerated a bit of consumer confusion and are best seen as involving a balance between conflicting interests in regulating the conduct of competing traders as well as safeguarding consumers of goods and services

Justifications for protecting trade marks and indicia These are different to things like patents which are justified as promoting creativity etc.

TMs and indicia as sources of information?The principal justification for legal protection of TMs and trade indicia is that they serve to communicate valuable information allowing consumers to make informed choices about purchases. They operate as an indication of origin. They also fulfil other functions dependant on their origin function. One is a product differentiation function - consumers can purchase products of similar quality by reference to their trademarks, reducing consumer search costs and increasing economic efficiency of markets In SA CNL-SUCAL NV v HAG GF AG the Advocate General said that TMs reward the manufacturer who consistently produces high quality goods and thus stimulates economic progress. Without them there would be no incentive for manufacturers to develop new products or maintain existing ones. Thus they serve as an indicia or guarantee of quality and if the manufacturer does not live up to it, they do so at their own risk

Preventing misrepresentation as a standalone justification

?A different justification is based on the idea that misappropriation of a brand owner's labour, investment and reputation should be prevented - this is like a natural right's argument o This can also explain traditional contours of passing off/registered TM law - traders shouldn't be allowed to take advantage of another trader's goodwill by using their TM such that traders ought to be granted rights to prevent the use of their marks by rivals in relation to the same or similar goods o The justification may also be said to extend beyond this to encompass situations where the other trade can be said to be taking advantage of the TM's reputation, even in the absence of consumer confusion This argument is often made on the latter basis that the old justifications for TMs don't represent market reality. Instead TMs now serve an advertising function in that consumers don't care about quality but see symbols that are desirable commodities in their own right o This is related to the idea of 'brand value' and 'brand image' o IT is argued that in light of this advertising function, owners should have legal protection against conduct that dilutes the value of their marks

Dilution??

In jurisdictions like the US and UK some legal protection is available against the dilution of TMs but it tends to be limited to particularly famous marks or those with a lot of reputation In Ty, Inc v Perryman Posner J identified three sources of dilution in the context of his example of the jewellery store 'Tiffany' and a restaurant adopting that same name o The concern that consumer search costs rise if TMs are associate with a variety of unrelated products. Where consumers see the same name they could think of both the restaurant and jewellery store and thus the efficacy of the name as an identifier will be diminished (increased imagination costs - blurring) o If the restaurant happens to be a striptease joint then even though consumers won't think of it as being commonly owned, the tendency of the human mind to proceed by association will tarnish the image of the jewellery store o There is also a concern that someone could take a free ride on the investment of the TM owner - even if the restaurant happened to be in a foreign country and those who shopped there would never buy anything at the jewellery store, the efficacy of the trademark as an identifier will not be impaired.
? But if the appropriation of Tiffany's aura is nevertheless forbidden by an expansive concept of dilution, the benefits of the jewellery store's investment in creating a famous name will be 'internalised - Tiffany will realize the full benefits of the investment rather than sharing it with others and thus the amount of investing in creating a prestigious name will rise The CB writers note that the problem with extending TM protection to this extent is that it isn't clear why advertising expenditure in creation of brand-value should necessarily be rewarded with stronger legal rights given that brand value is more to do with social responses This debate is important because in AU there are no specific anti-dilution laws in place

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