Ugg of war over sheepskin boots in the US

By Tommy Chen, Rob Vienet
Intellectual Property Patents & Trade Marks

Generic here might not be generic there 4 min read

An appellate court in the US has ruled that the word 'UGG' is capable of trade mark registration in the US for footwear because it is not a generic term – at least in the US – to describe what Australians would call 'ugg boots'.

This highlights that the meaning of words may differ between jurisdictions, and trade mark owners and users must consider validity and infringement issues by reference to the meaning of the word in the jurisdiction where trade mark registration is sought.

Key takeaways

  • A word that has a generic meaning in one country or to a particular demographic may still be distinctive, and therefore registrable as a trade mark.
  • Online sales can attract trade mark infringement proceedings in foreign jurisdictions. Accordingly, businesses should take care when trading or advertising online (especially if they have not conducted trade mark clearance searches in foreign jurisdictions).
  • In the US, goods that are made in one country may be marketed as having an association with another country if the totality of conduct is not misleading.

Who in your organisation needs to know about this?

Marketing teams; legal counsel.

Things stay UGGly for Aussie business

Recently, an appellate court in the US upheld the outcome in the trade mark infringement proceeding filed by Deckers Outdoor Corp against Australian Leather Pty Ltd and its owner. This is the latest salvo in the long-running, worldwide dispute between Deckers and Australian ugg boot makers. The appellate decision reinforces the lessons we reported on when the previous decision in the case was handed down.

When is an ugg boot an UGG boot?

Deckers owns a US trade mark registration for the word 'UGG' in relation to footwear. It alleged that Australian Leather infringed the 'UGG' trade mark by making online sales to US consumers of 14 pairs of ugg boots that were called 'UGG boots'.

In turn, the defendants argued that the UGG Trade Mark was invalid. Among other grounds, they argued that 'ugg' was the generic name for the goods or services for which the trade mark is registered, and was thus invalid under US law.

However, the US District Court for the Northern District of Illinois rejected this argument.

  • First, the court decided that the meaning of 'ugg' must be assessed by reference to the perceptions of the relevant public: in this case, ordinary American footwear purchasers (rather than Australians, or a narrower market of American surfers who might have perceived the word 'ugg' as generic).
  • Applying this test, the court was not satisfied that the evidence tendered by the defendants would allow a jury to conclude that the term 'ugg' has a generic meaning for the relevant public. Instead, the court preferred Deckers' evidence, which included survey evidence that 98% of survey respondents (all being part of the relevant public) viewed 'UGG' as a brand name.

Is it okay to associate US-Chinese boots with Australia?

Separately, the defendants also argued that Deckers contravened US laws against deceptive practices, by deceptively marketing its boots as being made in Australia. Deckers made its boots in China and other Asian countries, not in Australia. Although Deckers has rebranded to simply 'UGG' since 2015, before that period they had used the brand name 'UGG Australia'. The court did not accept the defendants' argument, holding that the totality of Deckers' conduct was not misleading. The court, in particular, observed the following.

  • Deckers accurately labelled the inside of each pair of boots with the actual country of manufacture.
  • At least in recent years, Deckers displayed country of original labelling on all footwear boxes and on its website.

According to media reports, Australian Leather had complained to the Australian Competition and Consumer Commission (the ACCC) about Deckers' conduct, but the ACCC took no action after Deckers rebranded to remove the reference to 'Australia'. Although it remains unknown how an Australian court would have assessed Deckers' previous conduct, its new branding appears less likely to draw regulatory action on the basis of the prohibition of misleading and deceptive conduct under section 18 of the Australian Consumer Law.

Actions you can take now

Consider whether your business has sufficient IP protection overseas, and whether it may be at risk of infringing the IP of a third party overseas, including by trading online.