INSIGHT

Federal Court closes the tap on Urban Ale trade mark

By Thomas Campbell, Tess Kirkinis
Food & Beverage Intellectual Property Patents & Trade Marks

In brief 3 min read

In an attempt to sue La Sirène for trade mark infringement, Urban Alley Brewery lost the registration rights to its 'Urban Ale' trade mark for lack of distinctiveness. We explore how attempting to enforce its trade mark registration rights backfired for Urban Alley.

Key takeaways

  • It is important to adopt, at the outset, a brand that is capable of distinguishing one trader's goods from others'.
  • A registered trade mark may still be vulnerable to cancellation by the court.
  • Claims of unjustified threats may be rejected when a predecessor-in-title has made the threat.

Who in your organisation needs to know about this?

Legal counsel and marketing teams.

Background

This dispute concerned two beer breweries, Urban Alley Brewery Pty Ltd and La Sirène Pty Ltd. Urban Alley was first in time with a trade mark registration for the words URBAN ALE, covering beer in class 32 with priority date 14 June 2016. Not too long after, La Sirène commenced using the words URBAN PALE in its product packaging, as shown below:

Urban Pale product packaging
Urban Pale product packaging

The fight of the frothy in the Federal Court

Urban Alley sued La Sirène for infringement of its Urban Ale trade mark in breach of section 120 of the Trade Marks Act 1995 (Cth) (the TMA). In response, La Sirène sought orders for the cancellation of the Urban Ale trade mark under s88(1)(a). The central issue in dispute was the ordinary signification of the words 'urban' and 'ale' when used in connection with beer, and whether the 'Urban Ale' trade mark was capable of distinguishing the craft beer that Urban Alley sold.

Is Urban Ale inherently crafty?

The court held that 'Urban Ale' was not capable of distinguishing Urban Alley's beers from those of other producers within the meaning of s41 of the TMA. This was based on evidence showing that 'urban' was commonly used in connection with beer products and breweries. The court gave weight to one expert witness who opined that 'urban' does not have any significance in terms of beer style or flavour characteristics; that it is a generic term used to describe the location of the brewery or its target audience; and that it communicates the aesthetic of an inner-city-brewery or describes the inner-city beer movement. Many journalists were found to use the word 'urban' to describe inner-city craft breweries. A number of Australian beer-related businesses had adopted the word 'urban' as part of their products or business name. Indeed, La Sirène itself was an example of a trader that had innocently adopted the words 'Urban Pale' without improper motive.

Accordingly, the words 'urban' and 'ale' were taken to be the common stock of language and were descriptive of the goods (in this case, beer). In the court's view, the trade mark was not to any extent inherently adapted to distinguish as at the priority date of 14 June 2016; and as there had been minimal use of the mark at that time, there was no factual distinctiveness and therefore the mark should not have been registered. Trade mark rights stopped flowing from the Urban Ale tap: Urban Alley's registration was cancelled under s88(1)(a). The infringement claims against La Sirène were thus dismissed.

Urban Pale

Despite not needing to consider infringement, the court made the following observations about La Sirène's defence under s120 of the TMA:

  • 'Urban Pale' was not used as a trade mark but, rather, as a product name that is descriptive of the nature and style of the beer product.
  • Prominence of 'Urban Pale' does not convert the descriptive name into a trade mark. Rather, 'by La Sirène' sufficiently conveys to a consumer the source of the origin of the product.

Unjustified threats

The threat to bring infringement proceedings was made by Collins Street Brewing Co. Pty Ltd, a predecessor of Urban Alley. The court held that s129 of the TMA does not establish a right of action against a successor-in-title to the person who made the threat to bring proceedings; and so, a claim of unjustified threats was rejected.