Should defensive trade marks be part of your portfolio protection strategy?
The value of defensive registrations
There are three main reasons to consider including defensive registrations in trade mark portfolio protection strategies. Firstly, unlike the United States, Australia does not have a law of trade mark dilution to protect well-known marks. Secondly, recent practice has shown the ease in which standard trade mark registrations can be removed or the goods/services limited in non-use actions. Thirdly, defensive registrations can provide a more convenient and cost effective avenue to relief than infringement actions under the Trade Marks Act 1995 (Cth) (“the Act”), the tort of passing off and for misleading and deceptively conduct under Australian Consumer Law.
The small number of defensive registrations that do exist – as at 14 June 2016, there are only 307 registered defensive trade marks listed on the Australian Trade Marks Office official records - indicate that these registrations remain underutilised. Given the benefit afforded to trade mark owners, why are defensive registrations not utilised more often in trade mark protection strategies?
Onerous requirements to demonstrate the extent of use and reputation in the mark and a connection with the goods/services for which defensive registration is sought, may be a deterrent for owners of well-known marks. However, given the significant value defensive registrations can bring to major brand owners, they should be considered more often in trade mark portfolio protection strategies.
What is a defensive trade mark registration?
A defensive registration provides enhanced statutory protection for a trade mark which has been used to such an extent for particular goods or services that if another party were to use the mark for even quite different goods or services, the public could be misled.
An example is the trade mark GRANGE which is especially well-known for wine and is registered for those goods. The trade mark owner does not use, nor may it ever intend to use, its mark for beers and non-alcoholic drinks, but is concerned that if any other party were to use GRANGE for those goods, the public is likely to be misled by assuming a connection or rights in GRANGE could be diluted. A defensive registration covering beers and non-alcoholic beverages prevents a third party from registering a mark for those goods and provides the trade mark owner with a statutory infringement action against unauthorised use of its mark for those goods.
A few examples of defensive trade marks currently on the Register include:
Advantages of a defensive trade mark
Requirement for filing defensive applications - extent of evidence and inferred connection
To be eligible for a defensive registration, an applicant must:
The extent of evidence of use/reputation required to establish the mark is well-known and the likelihood use of the mark in relation to goods/services of the defensive application will indicate a connection with the owner is a vexed issue. The extent of reputation to be demonstrated will vary depending on how closely allied the goods and services of the defensive application are to the goods and services subject of reputation of the owner.
Extent of evidence
Evidence must be supplied in a formal Declaration and should cover the following:
Reputation of the trade mark
Why potential consumers are likely to infer a connection
The “connection” need not be a connection in the course of trade. “Connection” should be understood in the broad sense ascribed to it of “association, relationship”. The Trade Marks Office Manual of Practice and Procedure details a number of factors which may influence a likely connection, these are considered below.
The nature of the mark
The existence of other registrations of the trade mark
The extent of use of the trade mark as otherwise registered by the applicants
The goods or services upon which the registered trade mark has been used
This list is by no means exhaustive.
Productivity Commission’s Recommendation
Although the recent Productivity Commission’s Draft Report on Intellectual Property Arrangements recommends abolishing defensive trade marks, to do so would breach Australia’s international obligations (including under TRIPS). The provisions for defensive registrations were broadened under the Act in order for Australia to comply with its international obligations to provide protection for well-known marks. However, the Report is silent on what would happen with the existing defensive registrations and whether an alternative provision for well-known marks would be introduced to avoid this breach. Given the extensive rights given to the owners of defensive trade marks, there is still value in obtaining a defensive registration notwithstanding this uncertainty.
Yes, the evidence required to show the extent and reputation of the mark and inferred connection with the goods/services covered by the defensive application may be burdensome. However, the time and expense to obtain a defensive registration must be measured against the broad scope of protection provided and the ease with which it can be enforced in comparison to infringement action under the Act for well-known trade marks and actions for passing off or misleading and deceptively conduct under Australian Consumer Law. For a company’s key marks, defensive registrations are valuable in the toolkit of trade mark rights.
This article originally appeared in the March 2016 edition of the Australian Intellectual Property Law Bulletin.
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