Imagine you’ve thought up a fantastic name for your business and are ready to start operating. You have set up your website and begun advertising online using your business name and a logo you’ve designed. Everything is going great and then you receive a letter stating you have infringed someone else’s trade mark. Below, we look at how you can respond to an allegation of trade mark infringement and the defences available to you in doing so.

Understanding the Allegation

If another business (or their lawyers) has notified you that your business’ name or logo is infringing on their trade mark rights, it is important first to assess the allegations to see if they are true. The Trade Marks Act 1995 (Cth) (TCA) sets out that if the name or logo is substantially identical or deceptively similar to the trade mark (and in relation to the same goods or services), then that person is infringing the trade mark. This is the case if the goods or services are the same or closely related.

It is also the case where a trade mark is well-known in Australia but is registered for unrelated goods or services. Given the trade mark’s notoriety, an ordinary person could make a connection between the unrelated goods or services and the registered mark. Consider, for example, DC Comics v Cheqout Pty Ltd (2013) 212 FCR 194 (FCA).

In this case, Cheqout applied to register the name ‘superman workout’ in class 41 for exercise classes. DC Comics opposed the application because it has registered the name ‘Superman’ for various goods and services in Australia. They argued that it is well-known in Australia and consequently, would cause confusion or deceive the public into thinking the ‘superman workouts’ were associated with the comic book character, ‘Superman’.

The Court held that there is no dispute that ‘Superman’ is a recognisable character, but that without a reference to the indicia of the character, there would be no confusion with the phrase ‘superman workouts’.

Cheqout had maintained that they were not associating the ‘superman workout’ with the ‘Superman’ character. However, evidence showed that Cheqout was using the ‘superman workouts’ phrase together with a shield device recognised as a ‘Superman’ symbol to relate to strength and fitness. As such, the indicia of DC Comics was used in association with the name, and this meant that Cheqout had submitted its application in bad faith. The Court subsequently refused their application on this basis.

Once you are aware as to what the registered trade mark owner is claiming, you can then respond with a suitable reply that considers the defences available to you.

Defences to Allegations of Trade Mark Infringement

There are several defences available under the TCA, which if successful would mean that your act of using a certain name or logo does not constitute trade mark infringement, including:

  • Using a person’s name in good faith (such as part of the name of a company);
  • Using the name of a person’s place of business in good faith;
  • Using the name in good faith to describe goods and services; and
  • Using a name for the purpose of comparative advertising.

For example, you won’t be infringing an already registered trade mark where the name you are using is your given name. Optical 88 Limited v Optical 88 Pty Limited [2011] FCAFC 130, provides a good example of this. Optical 88 Limited is a company incorporated in Hong Kong (Optical 88 HK) and has trade marks registered in Australia. It brought an action against Optical 88 Pty Ltd (Optical 88 AUS) for trade mark infringement.

Optical 88 AUS was able to rely on the defence that its use of the words ‘Optical 88’ to run its business was in good faith because it was using its own name. Parties are usually considered to have acted in good faith where there is no ulterior or untoward motive in using someone else’s trade mark. The Court also considers that good faith needs to factor into account the following:

  • Whether it was an honest use of the trade mark;
  • Whether there was intent to deceive the public into an association that doesn’t exist; and
  • Whether the trade mark was trying to appropriate the goodwill that the other business had acquired.

If you believe that your use of the registered trade mark was in good faith, you have a valid defence to using the mark. It is important to speak to a trade marks lawyer to ensure that you respond with every possible available defence to you.

Commercial Considerations

However, when facing an allegation of trade mark infringement, it is also important to consider whether or not engaging in a trade marks dispute to defend your position is worthwhile for your business. If you are just starting out and have not yet acquired any goodwill or reputation with the public or in your industry, then it may be worthwhile simply thinking about changing your business name or logo to one that is not infringing someone else’s.

On the other hand, you may have grown attached to your business name or logo, have spent considerable sums of money growing your business around your brand and developed a strong presence in your sector under that name. In this case, it may be commercially sensible to pursue your case and try to get a favourable outcome to protect your business and trade mark. Whether you are fighting your dispute in court or out, it is an expensive and personally taxing process that may still not provide you with a desirable outcome.

Key Takeaways

Coming up with your business’ name and logo is a big part of getting started. You can check to see if your name or trade mark is available and has not been registered by someone else. If you do find yourself at the receiving end of a trade mark infringement notice, it is important first to speak to a trade marks lawyer to have them assess the strengths and weaknesses of your case. They will then be able to guide you as to your best available options in the circumstances.

If you are unsure about how to respond to allegations of trade mark infringement, get in touch with our disputes team on 1300 544 755.

Bianca Reynolds
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