In brief 3 min read
The ongoing fish food feud between Trident Foods Pty Ltd (Trident) and Trident Seafood Corporation (TSC) continues. Although Trident's trade mark registrations survived the initial non-use skirmish before Justice Gleeson under a statutory discretion, the Full Court found that there was in fact authorised use of the trade marks through Trident's corporate structure, which makes this appeal decision important, and with broader implications affecting even land-based creatures.
A fishy refresher
The dispute between TSC and Trident centres on which party has the right to use the trade mark TRIDENT on seafood products, with TSC seeking removal of Trident's two TRIDENT word mark registrations for non-use.
TRIDENT-branded products were sold by Trident's parent company, Manassen Foods Pty Ltd, not Trident, during the relevant non-use period. Trident is a wholly owned subsidiary of Manassen, but Manassen and Trident did not have any formal licence arrangement until after the relevant non-use period. At trial, Justice Gleeson held that Trident had not exercised sufficient control over Manassen for the use to be considered 'authorised use' within the meaning of section 8 of the Trade Marks Act 1995 (Cth). However, Her Honour exercised the discretion under s101(3) to keep the marks on the register, taking into account a raft of considerations, as previously reported by InIP.
Alien acquiescence?
The Full Court's decision to recognise intra-group trade mark use as authorised use within the meaning of s8 of the Act has far-reaching implications for any trade mark owner that operates as part of a corporate group.
At trial, Justice Gleeson found that Trident merely acquiesced to Manassen's use of the marks, so there was insufficient control for authorised use. On appeal, Justices Reeves, Jagot and Rangiah held that, in a situation where the two entities share common directors, the idea that Trident Foods merely acquiesced to Manassen was 'alien'. The Full Court instead recognised that a parent company can be an authorised user of a subsidiary's trade marks without the presence of a formal licence.
The Full Court considered the corporate relationship between Manassen (the parent company and user of the trade marks), and Trident (the subsidiary and owner of the registered marks). Their Honours placed significance on the common directors shared by the two entities, concluding that the companies shared the same purpose of protecting Trident's valuable goodwill. The corporate relationship, common directorships and arrangements between the companies required active engagement by the directors, as opposed to mere acquiescence.
While Justice Gleeson found that the corporate relationship between Trident Foods and Manassen did not place Trident in a relationship of control over Manassen, the Full Court held that the relevant question for determining authorised use is not whether one company controls the other company, but whether one company (in this case, the wholly owned subsidiary) had control over the other company's use of the trade marks.
Since the common directors had obligations to ensure the maintenance and enhancement of the value in the relevant marks, their Honours found that such 'unity of purpose' between the two entities meant Trident necessarily controlled Manassen’s use of the marks. Even in the absence of examples of specific conduct that demonstrated Trident's control of Manassen's use of the trade marks, the court held that the unity of purpose was indicative of the existence of actual control and it would be inconceivable that Manassen was using the marks without the knowledge, consent and authority of Trident. The relationship between the entities rendered 'redundant any particular illustration of the actual control Trident Foods must have had as the owner of the marks' (see [46]). Accordingly, the use by Manassen was authorised use within the scope of s8.
Message from the school
This decision establishes that, where entities within a corporate group share common directors and unity of purpose, use by an upstream user may constitute authorised use by the downstream owner, even though evidence of actual control may not be available.