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Focus: Intellectual Property Bulletin

13 April 2010

In this issue: Our intellectual property lawyers and patent and trade marks attorneys provide an update on the latest cases and legislative developments regarding intellectual property  including passing off, confidential information, patents, trade marks and copyright.

Passing off – Federal Court plunges into depths of passing off and section 52 in coffee case

In brief: In a recent Federal Court decision, Justice Middleton was not convinced by well-known Danish design brand Bodum that two of its competitors had engaged in passing off or misleading and deceptive conduct in their manufacture and sale of similar coffee plungers and/or teapots.

By Tim Golder, Partner, and Marina Lloyd Jones, Senior Associate

In two separate proceedings heard together1, Bodum alleged breach of section 52 of the Trade Practices Act 1952 (Cth) and passing off by Playcorp Group of Companies Pty Ltd and Playcorp Pty Ltd (together, Playcorp), by its importation and sale of the Baccarat Venice Coffee Plunger and the Baccarat Devon Filter Teapot, and DKSH Australia Pty Ltd, by its production, importation, and sale of the Euroline Coffee Plunger. 

Secondary meaning in product features

Bodum submitted that it had a reputation or secondary meaning in its Chambord Coffee Plunger and Assam Teapot (the Bodum products) among a sufficient number of people in Australia, and that Playcorp and DKSH misled consumers by selling products whose features signified that they were made or licensed by Bodum, part of a Bodum range, or otherwise associated with Bodum. Justice Middleton disagreed, finding that Bodum's reputation did not lie in the 'naked' features of the Bodum products, but was 'distinctly tied to its products being properly labelled and sold in conjunction with reinforcing packaging and, significantly, by reference to the Bodum name.'2 While there may have been a few people to whom the product features had the alleged significance, these people would not conclude that the accused products would be part of the Bodum range, rather than simply copies or cheaper versions not associated with Bodum. In fact, the evidence indicated that 'Bodum understood the need to (and did) educate the relevant market to beware of copyists, and to look for the "original" Bodum'3.

Relevant date for assessing conduct

The relevant date for assessing whether conduct constitutes passing off is the date of commencement of the conduct. While this rule has been extended to s52 cases, an exception may be applied where the complainant 'allows its own trade to fall away'4 and itself causes deception by re-entering the market after the accused. According to Justice Middleton, the circumstances in existence at the time of hearing must also be considered 'even if only for determining the nature of the relief to grant'5.

Overall impression

Justice Middleton answered the question whether the accused products were likely to mislead or deceive 'not a side by side comparison... [but] a comparison between the impression of Bodum's products (including the packaging) retained in the ordinary reasonable customer's mind and the impression made by the sort of consideration that the ordinary reasonable customer is likely to give to the accused product (including the packaging) before purchasing it'6. While this consideration includes all information available to the potential customer prior to sale, including any advertising exposure, the place and time of sale is generally crucial. 

Get-up and packaging

Applying this test of overall impression, Justice Middleton was not satisfied that the accused products gave rise to the alleged deception. Of critical importance to his Honour's finding was Bodum's extensive use of its trade mark, which appeared extensively on the packaging of all of its products and on the products themselves. If a consumer was familiar with the Bodum range, they would expect to see the Bodum name and logo on its products. However, the accused products were clearly packaged and branded to distinguish them from Bodum, with no reference to the distinctive name or logo of Bodum. His Honour stated that:

... consumers are now sophisticated enough (at least in the relevant market here) to understand the concept of competing brands with no trade connection, even though there may be an element of copying. In fact, the similarity may put the consumer on guard to ensure that he or she takes care to purchase 'the original'. The evidence indicates that Bodum understood the need to (and did) educate the relevant market to beware of copyists, and to look for the 'original' Bodum.7

 

Justice Middleton endorsed the general principle laid down in the Puxu case8 that '[i]f an article is properly labelled so as to show the name of the manufacturer or the source of the article, its close resemblance to another article will not mislead an ordinary reasonable member of the public'. Bodum pointed to a number of cases (involving cigarettes, energy drinks and potato chips respectively) which have held that a product can be misleading despite the use of different branding9. His Honour agreed with the general proposition, however, and distinguished these cases on the basis that they related to cases of impulse purchasing of cheaper products, where a consumer would be instantly drawn to the look and feel of the get-up and more likely to mistakenly select the respondent's product in the belief they were buying the applicant's product. By contrast, a consumer would be expected to look at coffee plungers carefully and make a considered purchase after viewing the product and the packaging.

His Honour also noted that no evidence of actual confusion of a consumer had been led by Bodum, stating that while such evidence was not an essential element in a passing off or misleading conduct claim, its absence could also be significant10.

Packaging v retail display

Bodum had emphasised the importance of the retail display of the products themselves, arguing that the product was of utmost importance to consumers. It was argued that a consumer seeking to purchase a plunger with the Bodum features would, if only confronted by the Playcorp or DKSH products, be misled into thinking there was an association between those products and Bodum. The relevant deception would occur before the packaging could influence the consumer otherwise. Justice Middleton disagreed. Even consumers specifically seeking the Bodum product (even if not by name) would be aware of copies, and would discover upon viewing the products for sale of the different brands by their packaging and presentation of the product. Further, although the products may have been displayed out of their boxes instore, they were 'close enough physically to be connected to the product when out of the box, to be instructional and informative of the brand'11. The significance of packaging was evident in Bodum's own marketing approach, as Bodum 'devotes considerable skill and experience in designing its product packaging so that it will be attractive to consumers'12. Packaging could therefore not be overlooked in assessing whether there had been passing off or consumers had been misled or deceived.

Brand extension and licensing

In arguing that consumers would consider Baccarat and Euroline sub-brands of Bodum, or products made under its licence, Bodum cited its licensing activities with Starbucks and Gloria Jeans coffee outlets in Australia, where co-branded Bodum plungers are sold, and its own extension of the features of the Chambord Coffee Plunger range and the Chambord name to other Bodum products. In rejecting this contention, Justice Middleton noted that Bodum had undertaken all licensing and brand extension by diligently branding its goods with the Bodum name and logo.

Fraudulent intention

Bodum submitted that Playcorp and DKSH had intended to pass off their products as the Bodum products, which went to demonstrating a likelihood of misleading consumers. Justice Middleton confirmed the rule that 'if a mark or get-up for goods is adopted for the purpose of appropriating part of the trade or reputation of a rival, it should be presumed to be fitted for the purpose and therefore likely to deceive or confuse'13; however, he distinguished between an intention to copy and the requisite intention to deceive. Playcorp and DKSH had emphasised their own brand in product packaging, pointing against an intention to appropriate Bodum's goodwill.

Confidential information – Confidential workplace information

In brief: we look at two cases that deal with confidential information and intellectual property used by employees to set up competing businesses to their employers.

By Sarah Matheson, Partner, and Anna Burkhardt, Senior Associate

Introduction

The recent Federal Court case of Blackmagic Design Pty Ltd v Overliese [2010] FCA 13 concerned the conduct of two employees who, during their term of employment with Blackmagic started establishing a business that would compete with Blackmagic.

Various claims were brought by Blackmagic, but here we focus on those relating to alleged use of Blackmagic's confidential information, breach of contract and the somewhat novel argument that the first respondent (Mr Overliese) breached a fiduciary duty to disclose useful ideas to Blackmagic as his employer.

Background

Blackmagic designs, manufactures and sells hardware and software for broadcast television and video production and for consumer and commercial feature film post-production.

Mr Overliese was the director of hardware engineering at Blackmagic.  One of his key roles was to lead hardware development for the company. 

The second respondent (Mr Young) was Blackmagic's business development manager and his role included developing the sales channels for Blackmagic.

The third respondent was a company established by Mr Overliese and Mr Young (Atomos).

In early 2008, Mr Overliese created a spreadsheet on his private home computer entitled 'ycalcs.xls'. The spreadsheet contained various worksheets including details about:

  • video products, including Blackmagic's products;
  • Blackmagic products (and proposed products) and products of a hypothetical competitor (among them the 'Simple card'), including the production cost of each of Blackmagic's existing products by reference to the costs of the product components and the usage of the parts in question per month from August 200714;
  • the annual unit profit for each of the Blackmagic products as well as a calculated percentage contribution to overall profits made by the profit on each of those products and the likely calculation for the 'hypothetical' competitor15.

The spreadsheet was updated over time.

Mr Overliese also created a marketing plan document that included a section entitled 'competitors' which named companies (including Blackmagic) competing in the audio products market and contained data that related to the video industry.16

The decision
Misuse of confidential information

The court applied the test enunciated in Smith Kline & French Laboratories (Aust) Ltd v DCSH ((1990) 22 FCR 73 at 87) for the equitable obligation of confidence.  The key elements of the test are:

  • the plaintiff must be able to identify with specificity, and not merely in global terms, that which is said to be the information in question, and must be able to show that the information has the necessary quality of confidentiality (and is not, for example, common or public knowledge);
  • the information was received by the defendant in such circumstances as to import an obligation of confidence, and
  • there is actual or threatened misuse of that information, without the consent of the plaintiff.

The key question in this case was whether certain of the information used in the spreadsheet and the marketing plan constituted Blackmagic's confidential information.

While Mr Overliese conceded that the parts usage figures were confidential, he argued that the prices for the component parts were not confidential on the basis that those prices 'were very close to those which could be derived by the application of a conventional wholesale mark-up to the manufacturers' published prices'17.

The court rejected this argument, finding that 'however close those prices may have been to the hypothetical educated guess' the information was confidential to Blackmagic, and Mr Overliese was obliged to treat that information as confidential.18 Profit margin information was also held to be confidential.19

In granting a permanent injunction to prevent Mr Overliese from using the confidential information, Justice Jessup rejected Mr Overliese's argument that because the relevant confidential information 'is not such as he might carry around in his head'20 the injunction was not necessary. He found that, if Mr Overliese were not restrained, as a matter of law, he would have the right to use the information.21

In relation to Mr Young, Justice Jessup found that he was a recipient, rather than the originator, of the confidential material.  However, as Mr Young was a senior manager with knowledge of some of the information in the spreadsheet, a co-principal of Atomos and the author of an email to Mr Overliese that proposed that Atomos should produce and sell video capture cards, he was also bound by the terms of the injunction.22

Justice Jessup also held that 'self evidently, in the circumstances, Atomos should be similarly restrained.'23

Fiduciary duty to disclose useful ideas?

Blackmagic alleged that:

  • Mr Overliese had a fiduciary duty to disclose to it his ideas for new products; and
  • by failing to disclose details of one – the Simple card it suffered a loss by being unable to produce and market such a product until at least six months after it would have done if it had had the benefit of his ideas when they were formulated.24   

Blackmagic's argument was not supported by any cited authorities. The argument was rejected on the basis that the long-established authority 'that fiduciary duties are limited to imposing constraints on conduct...not by imposing a positive obligation of disclosure assumed by a duty to disclose' was fatal to Blackmagic's claim for a positive fiduciary obligation. 25

Contract claim against Mr Young

Mr Young's employment contract included clauses relating to confidential information, conflict of interest and 'non-compete'. 

The court was not satisfied that Mr Young used the confidential information of Blackmagic for his own benefit or that of a third party26. The court disregarded the conflict of interest clause, as Blackmagic failed to link the facts of the case to the prohibition.

Further, the court found that the non-compete clause did not cover any of Mr Young's activities at the relevant time.  First, the non-compete clause related to performing the duties of a software developer, while Mr Young had a sales role. Secondly, it sought to prohibit Mr Young from being involved in a 'business, activity or operation' that was the same as, substantially similar to, or competitive with Blackmagic. The court held that this prohibition did not apply to the 'very embryonic structure' of Atomos in the relevant period27

Contrast with the decision GlaxoSmithKline Australia Pty Ltd v Ritchie

The case of GSK v Ritchie28 had similar facts to those of Blackmagic. In each case:

  • senior employees were involved in setting up a potentially rival business;
  • the employees used their employers' information; and
  • no loss or damage was suffered by the employers as a result of alleged misuse of the confidential information.

In GSK v Ritchie, Justice Harper found that GSK failed to prove its claim that the former employee misused information confidential to it when he established a rival business. 

Justice Harper identified the key role played by the distinction between 'know how' (being an employee's 'stock of knowledge' developed during their employment29) and 'trade secrets' (which, in the context of that case, was defined as 'an item of confidential information, learnt during employment, the confidentiality of which, as an employee of ordinary honesty and intelligence would acknowledge, must be maintained even after that employment has come to an end'30).

As a result, in the absence of an appropriately drafted restrictive covenant, a former employee cannot be prevented from using their general stock of knowledge in subsequent employment.31  

Unlike GSK, the Blackmagic case did not refer to, or turn on, the distinction between know how and trade secrets. In Blackmagic, Mr Overliese admitted that certain information used in the spreadsheet was confidential to Blackmagic. Further, the confidential information that he used while still employed with Blackmagic was very specific being parts usage figures, prices for the component parts and profit margins. Arguably, these types of information do not qualify as 'general stock of knowledge'.  Indeed, Mr Overliese argued during the hearing that 'the information in question is not such as he might carry around in his head'32.

How does this affect you?
  • Employers should ensure that obligations in relation to the treatment of confidential information and other intellectual property rights are expressly provided for in their employees' contracts of employment, therefore providing an avenue to pursue an action based on breach of contract in addition to equitable remedies.
  • Employers should ensure that if their employees' contracts of employment have 'conflict of interest' or 'non-compete' clauses, they are carefully drafted to suit the role of the relevant employee.
  • Fiduciary duties imposed upon a fiduciary are proscriptive not prescriptive, so employers should not rely on equity to impose a positive obligation it is important to ensure that positive obligations have a contractual basis. 

Patents – Green tech patents fast-tracked internationally

In brief: Several national patent offices, including Australia's and those of its major trading partners, have taken steps to expedite examination of patent applications relating to green technologies.

By Trevor Davies, Partner, and Lester Miller, Senior Associate

How does it affect you?
  • Patents for green technologies in Australia and overseas may be granted years sooner than other technology patents.
  • Investors in green technology may support this technology sooner, with increased confidence from positive patentable outcomes.
  • Green technologies fast-tracked to the marketplace will be protected.
Developments

With the expedition of examination of patent applications relating to green technologies, the applications are moved to the front of the examination queue following a request for expedited patent examination by the applicant based solely on the invention's green credentials.

During the course of last year, Australia, the United States, the United Kingdom, Japan, Korea and China all commenced similar pilot programs. Governments intend that these programs will assist companies to bring their products to the marketplace sooner, thus enhancing profitability.

The new programs will likely have the effect of reducing the waiting time in these countries between requesting examination and receiving an examiner's report. Current delays of one to two years should be reduced to one to two months.

Australia

The Australian Government, according to a consensus of users, is likely to construe the term 'green' broadly to mean any technology with an arguable environmental benefit. 

There is no additional government fee for the faster processing. All that is required is a note on the examination request that the invention is 'green' and expedited examination is requested on that basis.

Overseas

It appears that some overseas governments will also interpret 'green' broadly but on a case-by-case basis. In the United Kingdom, an applicant need only make a 'reasonable assertion' regarding the invention's environmental benefits. 

In the United States and Korea, however, there is a set number of categories into which the invention must fall or the examination will not be expedited. The United States Patent and Trademark Office (the USPTO) classifies patent applications, and, although claims can be amended to attempt to fit the categories, the USPTO has the final say as to proper categorisation. The categories range from fuel and solar cells, to biohazard reduction, alternative irrigation, and reduced aerodynamic drag over car bodies.

The Korean Government claims to have introduced the fastest system in the world. It says that its expedited examination program, dubbed 'Superspeed', will see a patent granted within one month from application. The Superspeed system will apply to categories of invention relating to the environment or 'low carbon green growth'. 

Patent Cooperation Treaty

The World Intellectual Property Organisation, the organisation that manages the Patent Cooperation Treaty, is considering whether there are any steps that it can take to assist inventors and companies developing green technologies. These steps may include accelerated examination, lower official fees, and publication with a special green designation to highlight applications to investors.

Tips

First, consider whether your technology has an environmental benefit.

Secondly, consider whether expedited examination fits with your company's commercial strategy. For example, whether your company can afford to outlay patent prosecution costs now or would prefer to delay costs.

Thirdly, attracting investors can be enhanced following the grant of patents, which can demonstrate proof of the technology.

Fourthly, if expedited examination suits your commercial strategy, we recommend that examination in Australia be expedited in the first instance, as broader protection may be obtained in Australia before other jurisdictions commence examination. 

Patents – Patent infringement and company directors

In brief: This case highlights the need for company directors to be aware of their company's activities and be alert to risks relating to patent infringement.

By Trevor Davies, Partner, and Rob Silberstein, Senior Associate

Background

Inverness Medical Switzerland GmbH (Inverness), the owner of four Australian patents directed to immunoassays, sued five respondents alleging that pregnancy testing products marketed and sold by them infringed various claims in its four patents.

The first respondent, MDS Diagnostics Pty Limited (MDS AU), is an Australian company which sponsored the alleged infringing products under the Therapeutic Goods Act 1989 (Cth), and the second respondent, MDS Diagnostics Limited (MDS NZ), is a New Zealand company which is the Australian and New Zealand distributor of the alleged infringing products. The third respondent, Dr Appanna, is a director of both MDS AU and MDS NZ. The fourth respondent was deregistered and the fifth respondent entered into a personal insolvency agreement under the Bankruptcy Act 1966 (Cth). The case focused on MDS AU, MDS NZ (together referred to as MDS) and Dr Appanna.

In response to the suit for infringement, MDS challenged the validity of all four patents on various grounds.

Infringement and validity

Following exhaustive consideration of the meaning of a number of contested terms used in the patent specifications, a number of the claims in the patents were found to be valid. Two of MDS's pregnancy testing products were found to infringe some of these claims.

It is, however, the liability of a director that is of particular interest in this case. 

Dr Appanna's liability

Dr Appanna is noted on the company website as being managing director and founder of MDS. He controls the MDS companies as shareholder. Dr Appanna also works as a family physician in New Zealand.

Liability as joint tortfeasor

After noting three tests suggested by both parties as being those that may be applied in determining this head of liability the Auschina test, the Root Quality test and the Mentmore test Justice Bennet referred to the Full Court decision in Allen Manufacturing Co Pty Limited v McCallum & Co Pty Limited [2001] FCA 1838, where it was held that it is not necessary to determine which test is the correct one. At paragraph [183], her Honour said: 'The question is whether Dr Appanna knowingly pursued a course of conduct which, judged objectively, led to infringement or was likely to constitute infringement, or reflected indifference to infringement'.

That Dr Appanna controlled the companies as shareholder or was named managing director were not sufficient to establish liability. His liability should be determined, the judge said, by reference to his involvement in the management and operations of MDS concerning the infringing products. MDS made several submissions regarding Dr Appana's acumen, ability or skill, saying that these were insufficient for him to run the company. It also noted, among other things, that Dr Appanna did not participate in writing the business plan and his responsibilities were limited.

However, based on the evidence, her Honour found that Dr Appanna:

  • was the person to whom the general manager reported;
  • was the person who prepared board minutes without distributing them to other directors;
  • was aware of competitive products that were on the market;
  • was directly involved in obtaining the distribution rights for MDS NZ to sell the products in Australia;
  • was directly and personally involved in obtaining regulatory clearance of the products in Australia as managing director of MDS and in correspondence with the Therapeutic Goods Administration, and similarly was involved with Medsafe in New Zealand and was one of the 'responsible persons' listed in an application for a Medsafe licence under New Zealand's Medicine Act 1981;
  • continued to be involved in the sourcing, supply and sale of the products in Australia;
  • developed relationships with wholesalers and medical distributors on behalf of MDS NZ;
  • signed an agreement with a third party granting it a right to obtain orders for the products from Australian customers on behalf of MDS NZ; and
  • engaged in the necessary preparatory acts to, and part of the process of, the importation and offer for sale of the products and the using of the products for the purposes of sale.

On that basis, her Honour was satisfied that Dr Appanna 'deliberately, wilfully or knowingly pursued a course of conduct that resulted in MDS selling products that infringed the Inverness patents.  Further, he was aware of competing products on the market and was indifferent as to whether or not those products were protected by patents.  In taking part in the activities of MDS NZ and MDS Aus as a director and in the management of those companies, Dr Appanna directed or procured the obtaining of and the selling of the products that infringed Inverness' patents.' (see paragraph [192]).  Justice Bennett found Dr Appanna liable under both the Mentmore test and the Auschina test.

Authorising conduct of MDS s13(1) of the Patents Act 1990 (Cth)

It is infringement of a patentee's exclusive rights not only to exploit an invention but also to authorise another person to exploit it, and Inverness contended that Dr Appanna was liable for authorising MDS to exploit the invention the subject of the patents.

Her Honour held, at paragraph [202], that it is necessary to show actions that demonstrate the person alleged to have authorised exploitation did sanction, approve or countenance the act of infringement. On the basis of Justice Bennett's finding that Dr Appanna knew that the infringing act of the sale of the products would occur, that he had the power to prevent those acts and some duty to interfere, he infringed Inverness's exclusive right to exploit the invention of the patents.

Conclusion

When assessing Dr Appanna's personal liability for patent infringement, the court gave careful consideration to his involvement with MDS and its commercial activities, particularly with respect to the infringing products. Company directors actively involved in their company's management and operation should be alert to potential risks associated with the company's activities and whether any activities may infringe third-party patent rights. 

Patents – The final word on UWA v Gray

In brief: On 12 February 2010, the High Court refused the University of Western Australia (the UWA) special leave to appeal the findings of the Full Federal Court that rights to cancer treatments were legitimately exploited by Dr Bruce Gray. 

Justices Gummow, Hayne and Heydon took the view that the question as to ownership by universities of academics' inventions by an implied term of employment would arise only if a view contrary to that of the courts below was taken of the sequence of events relevant to the timing of the invention, which determined whether the invention was made at the UWA.  Their Honours held that this fact finding did not give rise to any ground for special leave.  Moreover, it was not an appropriate occasion to consider the questions of law regarding the implied term raised in the application.

Future court consideration has been left open by the High Court's refusal to consider the issues relating to the implied ownership term, and legislative intervention remains a possibility.  However, as Justice Gummow noted during the special leave application:

On a practical level the lesson of this case may be there is a need for express arrangements.  

Please also see our Focus and Client Update on UWA v Gray.

Trade Marks – Warning to rights holders unsolicited IP services

In brief: Clients should beware of unsolicited IP services that can cost thousands of dollars but offer no value.

By Chris Bird, Partner

A number of organisations around the world including in Australia issue official-looking documents to owners of recently published or recently registered patents, trade marks and designs. The information is readily and automatically sourced from public IP databases, and the documents are usually issued as invoices soliciting payment for services, often addressed to the accounts department of the rights owner. Nowadays, the documents usually have a very polished appearance, taking the form of trade mark certificates or similar. The services, when specified, usually involve little more than publication of the IP right on a website. The associated fees are often thousands of dollars.

As many of our readers know, these services are scams, and there is no value in the services provided. Unfortunately, this practice seems to be on the rise. The businesses are not associated with or endorsed by any patent office or other official authority.

We frequently remind our clients not to pay any fees from entities they have not engaged to work for them, and to refer any such communications to us.

Recently, a Florida company (the 'Federated Institute for Patent and Trademark Registry') engaged in this type of practice was found to have violated the state's Deceptive and Unfair Trade Practices Act. Approximately 1000 companies had made payments to the company (a total of around US$2.6 million). According to the evidence, one of the victims was the estate of Astrid Lundgren, the Swedish author of the Pippi Longstocking children's books, which made payments to the company of US$25,000 said to be due for trademarking the names of characters in the Longstocking books. The Florida Attorney General's Office is seeking full restitution for the victims, as well as severe penalties and an order for the defendants' assets to be repatriated from foreign bank accounts.

An additional nuisance that has been developing recently is the issuing by overseas firms or companies of notices informing trade mark owners that another party has applied to register an identical or similar trade mark in another country, and offering their services. These unsolicited approaches may represent legitimate services, in which case you will carefully need to consider whether you intend to use the trade mark in that particular territory, and seek advice from your IP advisers.

If you are ever in any doubt about what to do, when receiving such unsolicited correspondence, please contact us without delay to discuss the matter. If the behaviour of a company is a concern, you may consider reporting to the relevant trade practices organisation in your country, such as the Australian Competition and Consumer Commission (ACCC) in Australia.

Trade Marks – The 'Kit Kat' case – registering a trade mark by consent

In brief: A recent Federal Court case demonstrates that a letter from the Deputy Registrar of Trade Marks will assist a party to secure a trade mark registration in circumstances where the Trade Marks Office had originally refused to grant the registration.

By Richard Hamer, Partner, and Anna Burkhardt, Senior Associate

How does it affect you?
  • It is possible to secure registration of a trade mark by consent with the party who filed an opposition in circumstances where the Trade Marks Office initially refused to grant the registration.
  • When appealing a decision of the Trade Marks Office to the Federal Court of Australia, if an agreement is reached between the parties about registration, it is advisable to obtain a letter from the Trade Marks Office that indicates the office has no objection to the registration.
Background

Nestle applied for and secured acceptance of a trade mark described in the following terms 'the trade mark consists of the shape of the goods, being four bars attached to one another by a thin base as depicted in the representations attached to the application form'. The goods proposed for registration were 'chocolate confectionery being chocolate coated confectionery blocks or bars and chocolate coated wafer biscuits'.

Aldi Stores opposed registration of the application and was successful.33  We reported on the decision of the Trade Marks Office (the TMO) in our Focus.

The Hearing Officer took the view on the evidence that '... the public is not being educated to see the 4-bar shape as a trade mark, but to see that the product may readily and conveniently be snapped into either single or 2-bar portions ...'. The Hearing Officer was not convinced on the evidence that the shape had been used as a trade mark.

The appeal

Nestle appealed the TMO's decision to the Federal Court of Australia.

On 5 March 2010, the court made orders by consent that the appeal be allowed, the TMO's decision be set aside and the trade mark application proceed to registration.34 This is an interesting decision, in light of the fact that the TMO had ruled on the evidence before it that the use of the shape was not 'use as a trade mark'. 

This raises the question without the court having heard the case, what changed to convince the court to allow the trade mark registration?

There were two key factors in the court's decision:

  • Nestle produced to the court a copy of a letter from the Deputy Registrar of Trade Marks that indicated there was no objection to his delegate's decision being set aside so that the application could proceed to registration;35 and
  • as the trade mark had initially been accepted for registration, it would have been registered but for the opposition that Aldi had lodged.36 

The letter from the Deputy Registrar of Trade Marks was 'a matter of some importance'37 in the court's findings.

Copyright – Recent decisions

In brief: Two Federal Court decisions recently handed down will have important ramifications for those dealing with intellectual property in Australia.

In the highly anticipated judgment in Roadshow Films Pty Ltd v iiNet Limited (No. 3), it was found that Internet service provider iiNet was not liable for any copyright infringement committed by users of its services. This case attracted global interest and was the first in the world of its kind to reach hearing and judgment. See Focus: ISPs off the hook for now for more detail.

In the second case, Larrikin Music Publishing Pty Ltd v EMI Songs Australia Pty Limited, it was found that two bars of the popular folk tune 'Kookaburra sits in the old gumtree' were copied in the flute riff of Men at work's famous song 'Down Under', even though the riff was not a substantial part of 'Down Under' itself. See Focus: Copyright infringement of well-known musical work.

In another recent case, Telstra Corporation Limited v Phone Directories Company Pty Ltd, copyright in factual compilations was also raised again. Applying the High Court's decision last year in the IceTV case, Justice Gordon of the Federal Court held that the published editions of the White Pages and the Yellow Pages are not 'original literary works', meaning they cannot enjoy copyright protection. For an in-depth look at the case, please see our Focus: Database copyright in turmoil Judge points to Canberra.

Footnotes
  1. Playcorp Group of Companies Pty Ltd v Peter Bodum A/S [2010] FCA 23 (2 February 2010). The case was brought by Peter Bodum A/S, Bodum (Australia) Pty Limited and PI Design AG, which owns Bodum's Australian registered designs.
  2. At [82].
  3. At [94].
  4. Thai World Imports Express Co Ltd v Shuey Shing Pty Ltd (1989) 17 IPR 289 per Justice Gummow at 302.
  5. At [58].
  6. At [77].
  7. At [94].
  8. Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191 per Chief Justice Gibbs at 199-200.
  9. WD & HO Wills (Australia) Ltd v Philip Morris Ltd (1997) 39 IPR 356; Red Bull Australia Pty Limited v Sydneywide Distributors Pty Limited (2001) 53 IPR 481 and Kettle Chip Co Pty Ltd v Apand Pty Limited (1993) 46 FCR 152.
  10. Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd (No 4) (2006) 69 IPR 23 per Justice Heerey at [81].
  11. At [100].
  12. At [103].
  13. Australian Woollen Mills Limited v FS Walton & Co Limited (1937) 58 CLR 641 per Justices Dixon and McTiernan at 657.
  14. [2010] FCA 13 at [26].
  15. Ibid at [26]-[28], [41].
  16. Ibid at [53].
  17. Ibid at [76]
  18. Ibid
  19. Ibid
  20. Ibid at [78]
  21. Ibid at [79]
  22. Ibid at [81] - [82].
  23. Ibid at [83].
  24. Ibid at [93].
  25. Ibid at [96] referring to a quote from P & V Industries Pty Ltd v Porto (2006) 14 VR 1 at 9.
  26. Ibid at [106].
  27. Ibid at [107].
  28. (2008) 77 IPR 306.
  29. Ibid at [46].
  30. Ibid at [50].
  31. Ibid at [46] [47].
  32. [2010] FCA 13 at [78].
  33. Aldi Stores (a limited partnership) v Societe Des Produits Nestle S.A. [2008] ATMO 76 of 27/8/08.
  34. Societe Des Produits Nestle S.A. v Aldi Stores (A Limited Partnership) [2010] FCA 218 (5 March 2010).
  35. Ibid at [4].
  36. Ibid at [7].
  37. Ibid at [8].

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