I OVERVIEW

Australian trademark law is largely based on one key statute, the Trade Marks Act 1995 (Cth) (TMA). This legislative framework provides the foundations for general trademark protection in Australia, in addition to establishing certain specialised forms of trademark protection (such as certification marks).

Australian trademark law has also developed through judicial precedent, particularly in relation to passing off (a common law cause of action in Australia) and is further supplemented by consumer protection legislation (specifically, a cause of action for misleading and deceptive conduct). This chapter provides an overview of Australian trademark law and describes in detail the process for registering and enforcing a trademark in Australia in both a civil and a criminal context.

There have been some important cases relating to trademark law and misleading and deceptive conduct during the past 12 months, a number of which are discussed below. The most recent of these cases, the Moroccanoil v. Aldi2 decision of the Federal Court of Australia (FCA), considered in detail the relevance of intention in relation to misleading and deceptive conduct. The findings of the FCA are described in Section VI.

In 2016, the Australian Productivity Commission (PC) reported on its examination of the Australian intellectual property (IP) system, and in that report made a number of reform recommendations to the government. Following the recent response to the PC Report by the government, it seems very likely that the Australian trademark system will experience some change during the next 12 to 18 months. The salient features of the PC Report (from a trademark perspective) and the government’s response are explored in Section VII.

II LEGAL FRAMEWORK

i Legislation

The statutory framework for trademarks in Australia is the TMA, which was enacted, among other things, to comply with Australia’s obligations under TRIPS3 and to address the findings of a government Working Party Report on trademark law reform.4

International trademark treaties do not have direct effect in Australian law. TRIPS and the Paris Convention5 form part of the trademark legislative framework only to the extent that they have been implemented by national legislation. Generally, implementation of international conventions has been effected through the TMA. For example, Section 29 of the TMA provides a right of priority in Australia for trademark applications that have been filed in another Paris Convention country within the last six months.

The other international convention of particular relevance to Australian trademark law is the Madrid Protocol.6 This created a centralised international trademark registration system, whereby an application for a trademark may be filed in one jurisdiction and then assessed by several national trademark offices (resulting, if successful, in a series of national trademarks).

ii Authorities

The Trade Marks Office, which is a division of IP Australia, is responsible for trademarks in Australia. IP Australia itself is a government agency within the Department of Industry, Innovation and Science.

The Trade Marks Office is organised under the Registrar of Trade Marks, a role established by the TMA.7 The Registrar of Trade Marks receives, examines and reports on trademark applications made under the TMA and is responsible for assessing whether a trademark application complies with the TMA.8 Other functions include determining disputes as to the classification of goods and services, and overseeing proceedings for the removal of a trademark from the register. Pursuant to the TMA, the Registrar of Trade Marks also has powers to summon witnesses, receive evidence, require the production of documents, award costs in proceedings before the Registrar and notify any person of any matter that the Registrar considers should be brought to the person’s notice.9

iii Substantive law

The primary statutory framework for trademarks in Australia is the TMA, as outlined above. In addition to the general trademark protection offered under the TMA, there are legal frameworks creating certain special categories of trademarks.

Sections 168 to 183 of the TMA provide a framework for certification marks, which are a form of trademark used to distinguish goods or services that have been certified by the owner of the certification mark as having a certain quality or other characteristic.

Plant varieties may be protected under the Plant Breeder’s Rights Act 1994 (Cth). The Australian Grape and Wine Authority Act 2013 (Cth) and the Australian Grape and Wine Regulations 1981 (Cth) set out criteria for determining whether wines are protectable as geographical indications.

The registered trademark rights described above enjoy legal protection within statutory frameworks. There is not an equivalent statutory framework to protect unregistered trademarks, neither is there a specific law in Australia to prohibit unfair competition. However, the common law tort of passing off (which has its origins in English law) and the statutory cause of action of misleading and deceptive conduct found in Section 18 of the Australian Consumer Law10 (ACL) may provide relevant actions.

Business names may be registered on the Australian Business Names Register, which is administered by the Australian Securities and Investments Commission (ASIC). The Business Names Registration Act 2011 (Cth) and the Business Names Registration Regulations 2011 (Cth) provide the legal framework for business name registrations in Australia. This does not afford any proprietary right over the registered business name but is a regulatory requirement.

Domain name policy in Australia is administered by .au Domain Administration Ltd (auDA) pursuant to a government appointment. Domain name registrations in Australia are subject to auDA’s policies rather than a legal framework. Again, as discussed below, licences in respect of domain names do not afford a proprietary right over the names unless those domain names are used as trademarks.

III REGISTRATION OF MARKS

Trademark applications in Australia are usually completed online and the government cost is calculated per class, ranging from about A$250 to A$480 per class (depending on the method chosen and the type of mark). From October 2016 separate fees that had previously been payable upon registration of the mark (in addition to application fees payable on application) were abolished by IP Australia. Trademark registrations must be renewed every 10 years, at a government cost of around A$400 per class.

Applications are typically examined within three to four months (although it is possible to apply for an expedited examination). The examiner will consider the application to confirm that it meets the TMA registrability requirements and all relevant formalities. If accepted by the examiner, the trademark will be advertised and open for opposition for two months. If no oppositions are received, the mark will proceed to registration with the priority date being the date of the application. If the application receives an adverse examination report, the applicant has 15 months from the date of the report for the application to be accepted (that is, to respond to the examiner’s objections and have the examiner consider this response and reconsider the application in light of the response), with extensions of three or six months available upon payment of additional fees.

As Australia is a signatory to the Madrid Protocol, applicants for or owners of registered trademarks in Australia can use their applications or registrations as a basis to apply for international protection in any of the Madrid Protocol contracting countries. Applications are assessed by the relevant national offices and, if successful, marks are granted effectively the same protection in the chosen countries as they have in Australia. As with national marks, international trademark applications may be filed through IP Australia. Conversely, trademark owners overseas can designate Australia in their Madrid Protocol international trademark applications. These applications are assessed by the Trade Marks Office in Australia in the same way as national applications and, if granted, registration gives the overseas owner the same protection as if they had applied for a national mark in Australia. Use of the Madrid Protocol for international filings can be significantly cheaper and easier than applying for national trademarks in each country.

Australia is also a signatory to the Paris Convention, so that applications first filed in Australia can be filed in another Paris Convention country within six months, claiming the filing date from Australia. Foreign applicants can file in Australia in the same way. This means that no Australian application can progress to registration in less than six months to allow for priority claims.

i Inherent registrability

To be registrable under the TMA, a trademark must be a ‘sign used or intended to be used to distinguish the goods or services dealt with or provided in the course of trade by a person’ from the goods or services provided by another person.11

The definition of a ‘sign’ in the TMA is extremely broad. A sign can be any of, or any combination of, the following: letter, word, name, signature, numeral, device, brand heading, label, ticket, aspect of packaging, shape, colour, sound or scent.12

To be registrable, a trademark must therefore satisfy the requirement of being capable of distinguishing – either because it is inherently distinctive, or because it has acquired distinctiveness through use so that in practice it serves to distinguish the goods or services of the owner.

A note to Section 41(1) of the TMA provides that a trademark is not likely to be inherently distinctive if it consists wholly of a sign that is used to indicate characteristics of the goods or services or the time of production of the goods or rendering the services. This guidance is considered in the context of the goods and services for which registration is sought – a trademark that lacks distinctiveness for one class of registration may still be inherently distinctive in relation to another.

The examiner will object to an application if the trademark is considered to be descriptive or lacking distinctiveness.13 Applicants may be able to overcome this objection by demonstrating inherent distinctiveness or by providing evidence of use to demonstrate that the mark has acquired distinctiveness and now serves as an indicator of their organisation.14

It is possible to register a trademark for a domain name but to do so the trademark owner would need to overcome the distinctiveness hurdles described above. Domain names are unlikely to be inherently distinctive and instead must acquire distinctiveness so as to distinguish the goods or services offered under that domain as originating from an organisation. Even if the composite parts of a domain name would otherwise be descriptive (such as ‘realestate.com.au’), if the domain name has acquired a secondary meaning so as to identify goods or services as originating from an organisation it has in fact acquired distinctiveness and may be registrable as a trademark.15

ii Prior rights

The examiner will also raise an objection if the trademark is considered substantially identical or deceptively similar to an earlier registered or pending trademark, and covers similar or closely related goods or services.16 Applicants may be able to overcome such objections by demonstrating honest concurrent use, prior use dating from before the priority date of the cited mark, or some other circumstances that satisfy the examiner that the mark should be registered.17

iii Inter partes proceedings

Once an application has been advertised, third parties can oppose the registration of a trademark on various grounds, including:

    • • the grounds for rejection of an application discussed above, being a lack of distinctiveness or the existence of prior rights;
    • • that the applicant is not the rightful owner of the trademark, is not intending to use the mark, or has made the application in bad faith; and
    • • that the trademark is similar to another (unregistered) mark that has acquired a reputation in Australia, such that the registration would be likely to cause confusion among consumers.18

Third parties may also write to the Registrar seeking revocation of acceptance of a trademark application if they consider that IP Australia has made an error in accepting an application, usually because of a prior right missed in IP Australia’s search. It is at IP Australia’s discretion whether it revokes acceptance and such requests are rarely granted. Third parties can also apply to remove a registered mark if:

  • • the owner has not used the mark for a continuous period of three years prior to the date of the application;
  • • the owner did not have any intention to use the mark when it was registered; or
  • • the owner has not used the mark in good faith.19

If the owner of the mark wants to retain its registration, it must oppose the removal claim.

The inter partes proceedings described above (except revocation) are heard by a Hearing Officer from the Trade Marks Office, to whom both parties provide written submissions and evidence in advance of the hearing and verbal submissions on the day of the hearing, although it is possible to have an opposition decided based on written submissions alone. The Officer will provide a written decision and reasons within three months.

iv Appeals

Either party may appeal to the FCA or the Federal Circuit Court (FCC) within 21 days of the decision. Appeal hearings are de novo, so that new evidence and arguments can be introduced.20

IV CIVIL LITIGATION

Common causes of action for civil litigation are trademark infringement under the TMA, the common law tort of passing off, and for misleading and deceptive conduct under the ACL.

i Forums

The FCA, FCC and supreme courts of the various states and territories can all hear claims regarding trademark infringement, passing off and misleading and deceptive conduct; however, in practice, these claims are typically brought in the FCA.21 Intellectual property is one of nine specialised national practice areas for the purposes of FCA hearings, and trademarks is a sub-area within the intellectual property national practice area.

The Productivity Commission’s Inquiry Report on IP Arrangements (as referred to in Section I),22 released in December 2016, noted that few IP cases are currently initiated in the FCC due to a lack of judges with IP experience. The PC Report recommended introducing a specialist list in the FCC encompassing features similar to those of the UK Intellectual Property Enterprise Court, including minimising court appearances, limiting the length of trials, caps on costs and damages, and a small claims procedure suitable for self-represented litigants.

In June 2017, the FCC announced a new pilot programme and practice direction for its Melbourne Registry to streamline the management of IP matters and increase the visibility of the FCC as an alternative to the FCA. The FCC has appointed three specialist IP judges, who will implement strict case management of proceedings, including the trial itself which is limited to two days, to ensure an efficient use of the court’s time and resources.

ii Pre-action dispute resolution

Alternative dispute resolution (ADR), including mediation, arbitration and expert determination, is strongly encouraged as an alternative to litigation. It is a requirement prior to launching proceedings in the FCA or the FCC that proper attempts have been made to resolve a dispute between the parties.23

IP Australia recently launched the IP Mediation Referral Service, which aims to provide small and medium-sized enterprises (SMEs) with access to qualified, accredited specialist mediators to resolve their disputes out of court. In its response to the PC Report, the government noted that it is currently reviewing the information it provides about IP infringement and enforcement to enable Australian businesses to take the most appropriate action to resolve disputes, and will explore other strategies to encourage SMEs to use ADR mechanisms.

iii Causes of action

The owner of a registered trademark can bring an infringement claim against another party if a sign that is either identical or deceptively similar to the owner’s registered trademark is used by the other party as a trademark.24 There are, however, numerous defences to alleged infringement, including the use of a name or business location in good faith, descriptive use in good faith, use in comparative advertising, and prior and continuous use.25

Trademark infringement claims are often brought in conjunction with claims for passing off or misleading and deceptive conduct. As noted above, these causes of action depend upon whether consumers have been, or are likely to be, misled or deceived as to the origin of the respondent’s goods or services, incorrectly believing that they come from or are affiliated with the applicant. Where the applicant has unregistered trademarks or suffers misuse of company, trade, business or domain name, the applicant will have to rely on these causes of action.

The leading authority on passing off requires a misrepresentation made in the course of trade (1) to prospective or actual customers of goods or services supplied by the injured party; (2) that is calculated to injure the business or goodwill of another trader; and (3) that causes actual damage to the business or goodwill of the claimant.26

The later English authority of Reckitt & Colman27 is also applied, in which the elements of passing off (often referred to as ‘the classic trinity’) were identified as (1) the existence of a reputation; (2) a misrepresentation leading or likely to lead the public to believe that the defendant’s goods are the plaintiff’s goods; and (3) damage suffered by the plaintiff as a result of that erroneous belief.

iv Conduct of proceedings

Court proceedings in Australia are similar to other common law systems with advocates (usually barristers) appearing in person before the courts.

For infringements requiring urgent restraint, the court has the power to order an interim injunction ordering that the alleged infringer ceases its action immediately, pending the outcome of the trial.

The court also has powers to require Anton Piller orders, which operate like a search warrant allowing the applicant to search the alleged infringer’s property without notice and to seize evidence. Generally, these are only granted in serious cases where there is sufficient evidence that the subject of the order possesses important evidence and is likely to destroy it or otherwise cause it to be unavailable for use.

Substantive trademark infringement proceedings are commenced by a statement of claim. The alleged infringer then has the opportunity to reply to these claims. Following this, the parties provide each other with all relevant documents in their possession by way of discovery. Evidence in support of each aspect of the claim (including the quantum of damages) is then provided by the applicant, often by way of written statements such as affidavits by relevant witnesses or experts, and evidence in answer is provided by the defendant. This evidence is likely to be tested by way of cross-examination of witnesses during a hearing, after which the judge will rule on the facts, apply relevant law to the case and issue a judgment. Court proceedings can be lengthy, and resolution of fully contested proceedings can take more than a year.

v Remedies

The court can grant an injunction to restrain further infringement, passing off or engagement in misleading or deceptive conduct, and at the option of the applicant, either damages or an account of profits.28 As a result of recent amendments, the court also has powers under the TMA to award additional punitive damages for trademark infringement if it considers it appropriate to do so, having regard to matters such as the flagrancy of the infringement, the need to deter others from similar conduct, the conduct of the infringer after the infringement (and particular after being informed of the infringement) and any benefit the infringer has gained as a result of the infringement.29 This power has been used in recent cases where it has been difficult to establish actual loss or where infringement has continued following notice of the relevant trademark owner’s rights.30

V OTHER ENFORCEMENT PROCEEDINGS

The TMA and the ACL contain various criminal offences in relation to counterfeiting, which are brought by the Australian Federal Police or the Department of Public Prosecutions. In the case of the ACL, the Australian Competition and Consumer Commission (ACCC) has the power to commence proceedings. In Australia, it is a criminal offence to:

  • • falsify a registered trademark;
  • • falsely apply a registered trademark;
  • • alter or remove a trademark knowing it is a registered trademark;
  • • make a die, block, machine or instrument that can help in falsifying or removing a trademark;
  • • sell, possess, distribute or import a good, knowing that the trademark has been falsified or removed;31 and
  • • make certain false or misleading representations about goods or services, including in relation to the standard, history, value, place of origin, nature or characteristics of goods or services.32

The penalties for these criminal offences may include imprisonment or a fine. However, in practice, criminal proceedings are rarely brought and are typically confined to cases involving organised crime or public health and safety issues.

The TMA also contains a scheme allowing the Australian Customs Service (Customs) to seize imported shipments of goods suspected of infringing registered trademarks.33 Rights holders can lodge a notice of objection with Customs listing the marks they would like to protect, and Customs then seizes goods imported into Australia bearing these marks if they are suspected of being counterfeit. The importer has a short time to provide grounds for releasing the goods, otherwise they are automatically forfeited to Customs and ultimately destroyed.

VI RECENT AND PENDING CASES

i Developments in misleading and deceptive conduct

The FCA recently handed down its judgment in the case of Moroccanoil Israel Ltd (MIL) v. Aldi Foods Pty Ltd.34 In this case, extensive evidence was presented about the similarities between the overall appearance or ‘get-up’ of Aldi’s argan oil range and MIL’s hair products, with MIL alleging that these similarities constituted misleading and deceptive conduct. There were also separate, but related, trademark infringement claims. Aldi argued that it intended to create its own argan oil product range, which would inevitably feature similarities to other products on the market because those features constituted cues that consumers identified with the relevant product category or conveyed information in relation to the products’ ingredients. The court held that consumers were unlikely to be misled by any similarities, in large part because of the different trade channels involved and Aldi’s well-known business model.

There have been many decisions pursuant to the ACL relating to the role of intention. While intention is not necessary for a finding of misleading and deceptive conduct under the ACL, it can in some cases be persuasive or of interest to the decision maker. The latest decision by the FCA (above) reinforces that even if there is some form of intention (in this case, intention to reference another person’s product), it will not give rise to a finding of misleading and deceptive conduct if the court does not find that consumers are likely to actually be misled or deceived.

ii Trademark ownership and assignment

The Full Court of the FCA in Pham Global Pty Ltd v. Insight Clinical Imaging Pty Ltd35 confirmed that trademark applications filed in the name of a party other than the rightful owner of the mark are invalid, and this invalidity cannot be rectified by later assignment of the application to the rightful owner. This case highlights the importance of ensuring applications are correct when filed, because it may not be possible to rectify errors at a later date.

iii Trademark infringement in Google AdWords and website metatags

In Veda Advantage Limited v. Malouf Group Enterprises Pty Limited,36 it was held that using a competitor’s trademark as a keyword in Google AdWords does not amount to trademark infringement, nor it is misleading and deceptive conduct under the ACL. One of the reasons for this decision was that the use of a keyword was not considered to be use of a trademark. The keyword comprising the trademark is not used to distinguish the goods and services of the AdWords purchaser from the goods and services of other uses, but rather as a marketing tool to identify potential customers. The court highlighted that keywords are invisible to consumers. The judgment suggests that it would be impossible for a keyword to constitute a trademark infringement – a keyword cannot be understood to be in use to distinguish the goods and services of one undertaking from another, when the keyword is not visible to consumers.

By contrast, the recent decision of Accor Australia & New Zealand Hospitality Pty Ltd v. Liv Pty Ltd37 demonstrates that the same is not true where trademarks are inserted as metatags into the source code of a website (which can result in the website responding to searches for those terms in organic Google results). Drawing this distinction was justified by the court on the basis that while the source code is not immediately visible on a website, it is possible to reveal it by performing simple steps in an internet browser. The court came to this decision notwithstanding that only those with technological understanding would know how to perform these steps without further instruction and so the metatag might arguably still be invisible to most consumers.

iv Shape trademarks

The recent case of Clipsal Australia Pty Ltd v. Clipso Electrical Pty Ltd (No. 3)38 has reinforced the difficulty of obtaining trademark registrations for shapes. Successful shape mark registrations include the iconic curved Coca Cola bottle and the triangular wedges of Toblerone-branded chocolate. While shapes are registrable as trademarks under the TMA, applicants have historically encountered difficulties in obtaining trademark registrations for shapes because it is often held, including in relation to Clipsal’s dolly light switch at issue in these proceedings, that a shape does not perform the essential function of a trademark – namely to identify the goods and services as originating from the owner of the mark. Instead, the shape is seen as merely a functional aspect of the product itself.

VII OUTLOOK

The coming years are likely to herald some changes to the TMA and Australian trademark law. The government response to the PC Report was published in August 2017 and took a positive but cautious approach to the sweeping reforms proposed in the PC Report (although the PC Report recommendations in relation to trademarks were more conservative than the proposals for other areas of intellectual property).

The government supports the Commission’s recommendation to reduce the grace period from five years to three years before new trademark registrations can be challenged for non-use to assist with decluttering the Trade Marks Register. The Commission also recommended requiring a statement of ‘use’ or ‘intention to use’ marks at the points of application, registration and renewal. The government supports this recommendation in principle, and IP Australia is now expected to undertake further research to determine the extent of clutter on the Trade Marks Register to inform the reforms.

It does not appear that the government has immediate plans to take up the PC Report’s other recommendations in relation to trademarks, such as removing the presumption of registrability and linking the Australian Trade Mark Search database with the business registration portal.

Separately, IP Australia is consulting on the introduction of divisional applications for international registrations designating Australia under the Madrid Protocol, and consequential proposals to harmonise existing practice in Australia for dividing domestic trademark applications to align with the new international procedures. IP Australia considers this issue to be a high priority for implementation in 2018.

1 Frances Drummond is a partner and Sophie Lees is a senior associate of Norton Rose Fulbright. The authors would like to thank Isobel Taylor, associate of Norton Rose Fulbright, for her assistance in preparing this chapter.

2 Moroccanoil Israel Ltd (MIL) v. Aldi Foods Pty Ltd [2017] FCA 823.

3 Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C, 1869 UNTS 299, 33 ILM 1197 (1994).

4 Working Party to Review the Trade Marks Legislation, Recommended Changes to the Australian Trade Marks Legislation, Department of Science and Technology (Canberra, 1992).

5 Paris Convention for the Protection of Industrial Property (as amended on 28 September 1979) 21 UST 1583, 828 UNTS 305.

6 Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks (as amended on 12 November 2007), opened for signature 28 June 1989 (entered into force on 1 December 1995).

7 Trade Marks Act 1995 (Cth), Section 201.

8 Ibid., Section 31.

9 Ibid., Section 202.

10 Competition and Consumer Act 2010 (Cth), Schedule 2 (Australian Consumer Law).

11 Trade Marks Act 1995 (Cth), Section 17.

12 Ibid., Section 6.

13 Ibid., Section 41.

14 Ibid.

15 REA Group Ltd v. Real Estate 1 Ltd [2013] FCA 559, paragraphs 106–110.

16 Trade Marks Act 1995 (Cth), Section 44.

17 Ibid., Section 44.

18 Ibid., Part 5, Division 2.

19 Ibid., Section 92.

20 Registrar of Trade Marks v. Woolworths (1999) 45 IPR 411.

21 Trade Marks Act 1995 (Cth), Section 190; Competition and Consumer Act 2010 (Cth) ss 138, 138A, 138B.

22 Productivity Commission 2016, Intellectual Property Arrangements, Inquiry Report No. 78, Canberra.

23 Civil Dispute Resolution Act 2011 (Cth), Section 6.

24 Trade Marks Act 1995 (Cth), Section 120.

25 Ibid., Sections 122 and 124.

26 Erven Warnink BV v. J Townend & Sons (Hull) Ltd (No. 1) [1979] AC 731.

27 Reckitt & Colman Products Ltd v. Borden Inc (1990) 17 IPR 1.

28 Trade Marks Act 1995 (Cth), Section 126; Australian Consumer Law, Sections 232 and 236.

29 Trade Marks Act 1995 (Cth), Section 126.

30 See, for example, Halal Certification Authority Pty Limited v. Scadilone Pty Limited [2014] FCA 614 and Vertical Leisure Limited & Anor v. Skyrunner Pty Ltd & Anor [2014] FCCA 2033.

31 Trade Marks Act 1995 (Cth), Part 14.

32 Competition and Consumer Act 2010 (Cth), Schedule 2 (Australian Consumer Law), Chapter 4.

33 Trade Marks Act 1995 (Cth), Part 13.

34 [2017] FCA 823.

35 [2017] FCAFC 83.

36 [2016] FCA 255.

37 [2017] FCAFC 56.

38 [2017] FCA 60.