Organisers of popular American music festival Coachella have filed a lawsuit against Hoodchella, an underground music festival and are engaged in a trade mark dispute.

Around since 1999 and running over a weekend in Indio California, Coachella is one of the United States’ biggest music festivals. Hoodchella, introduced in April 2015, holds its inaugural one-day event right in the middle of the Coachella weekend.

This year, Hoodchella’s organisers decided to make the festival three days long, which has made Coachella sit up and notice.

Coachella’s lawsuit claims “trademark and service mark infringement, false designation of origin, dilution, unfair competition and cybersquatting, a term used in this case over the festival’s registration of the hoodchella.com domain name.”

Coachella is seeking an injunction against the organiser of Hoodchella and $US100,000 in damages, and for the domain name to be removed.

What will happen to Coachella’s lawsuit, and is there any substance to their claims?

Trade Mark Infringement

The name “Coachella” is a registered trade mark in the US. When determining whether Hoodchella infringed this trade mark, the courts will consider whether Hoodchella is too similar to Coachella. Coachella has asked Hoodchella’s organiser Kamil Al-Ahdali to use a more distinctive name, but he has refused.

False Designation of Origin

False designation of origin is a consumer law concept. Coachella is claiming that Hoodchella is giving consumers a misleading impression of the LA festival’s origin. Specifically, Coachella is concerned that people would see Hoodchella as an offshoot, rather than a competitor. Al-Ahdali and Hoodchella have been adamant that the name ‘Hoodchella’ does not cause their fans to think that the two festivals share the same origin.

Dilution

A trade mark needs to be distinctive. Trade mark dilution is recognised by US law and occurs where a similar name decreases a recognised name’s distinguishability. Here, Hoodchella could dilute Coachella and harm its established reputation. Australian trade mark law does not so clearly recognise dilution and manages its effects indirectly.

Each new trade mark application requires an opposition period whereby trade mark owners can raise objections against trade marks that are too similar. Trade mark owners can also register ‘defensive’ trade marks that they may not intend to use, and take action against infringers of the registered trade mark.

Unfair Competition

In the US, trade mark infringement is considered unfair competition and is prohibited under common law as well as state and federal statutes. Unfair competition occurs because trade mark infringement in this case may cause people to think that Coachella and Hoodchella are associated. Coachella’s concern would be that their fans and attendees would purchase tickets to Hoodchella, either believing that it was the Coachella music festival or that it would be very similar.

In Australia, Fair Trading legislation and the Australian Consumer Law (ACL) govern unfair competition and trade mark infringement and prohibits misleading and deceptive conduct. For example, Hoodchella can’t mislead or deceive consumers into thinking it’s associated with Coachella. 

Cybersquatting

Coachella claims that Hoodchella’s purchase of the hoodchella.com domain name is cybersquatting, which is contrary to US law (under the Anticybersquatting Consumer Protection Act). Purchasing an internet domain name with the intention to profit from the goodwill of someone else’s trade mark in bad faith is considered cybersquatting. Coachella’s justification is that since the word Hoodchella is so similar to Coachella, the registration of the domain name hoodchella.com was registered to capitalise on Coachella’s reputation.

Cybersquatting also gives rise to causes of action in Australia, including trade mark infringement, passing off or misappropriation. In Australia, the .au Domain Administration (auDA) regulates the domain name space. It is quite common for cybersquatting to occur with .com, .net and .org registrations, and less common with .au registrations because of the policies auDA enforces. 

Key Takeaways

Each of the claims of trade mark infringement, dilution, unfair competition and cybersquatting, rely on the fundamental claim that ‘Hoodchella’ is similar enough to ‘Coachella’ to be confusing and misleading to consumers. The similarities between both events (music festival, target audience, related activities, bands, artists, time of the year, location, etc.), may support Coachella’s argument and backup their claims.

Although there are some differences between terminology and the formal recognition of trade mark values in the US and Australia, the underlying principle of a trade mark’s distinctiveness and its intrinsic right to maintain this distinctiveness applies in both jurisdictions

***

What do you think? Tag us on Twitter @legalvision_au and let us know or ask our intellectual property lawyers. 

Dhanu Eliezer

Next Steps

If you would like further information on any of the topics mentioned in this article, please get in touch using the form on this page.