A recent Federal Court decision reminds Australian brand owners of the importance of choosing and using trade marks that really are capable of distinguishing their goods and/or services from those of other traders.
In his 10 December 2010 decision in Yarra Valley Dairy Pty Ltd v Lemnos Foods Pty Ltd  FCA 1367, Middleton J of the Federal Court granted Lemnos Foods’ cross-claim to remove Yarra Valley Dairy’s Australian Trade Mark Registration 828542 PERSIAN FETTA for “Dairy products including cheese” in class 29.
On 21 March 2000, Yarra Valley Dairy, a farm-based cheese maker from Victoria applied to register PERSIAN FETTA for “Dairy products including cheese”. After extensive correspondence with the Examiner and providing a declaration seeking to prove significant use and a reputation in the mark, the application was accepted under the provisions of section 41(5) of the Trade Marks Act 1995 (Cth) (the Act) and was subsequently registered.
In the Federal Court proceedings, Yarra Valley Dairy sought relief for passing off and contravention of the Trade Practices Act for misleading and deceptive conduct. However Middleton J held that these aspects of the action could not succeed as there was an insufficient likelihood that consumers would be misled by the packaging of the Lemnos PERSIAN MARINATED CHEESE goods to think that these goods were associated with Yarra Valley Dairy.
Yarra Valley Dairy also alleged that by using “PERSIAN FETTA” and “PERSIAN MARINATED CHEESE” in relation to a marinated cheese product, Lemnos had contravened section 120 of the Act and infringed its trade mark.
Lemnos responded to Yarra Valley Dairy’s allegation of trade mark infringement by arguing that Yarra Valley Dairy’s PERSIAN FETTA trade mark registration should be cancelled pursuant to sections 88(2)(a) and (e) of the Act on the grounds that the registration could have been successfully opposed and the application was accepted as a result of a misrepresentation. It was common ground that the word “Fetta” was wholly descriptive of a type of cheese and could not be distinctive in itself of Yarra Valley Dairy’s product. The onus then fell to Lemnos to establish that as at the filing date, the PERSIAN FETTA trade mark was descriptive and not to any extent inherently adapted to distinguish Yarra Valley Dairy’s goods from the goods of other traders.
Despite Yarra Valley Dairy’s objections, the Court permitted Lemnos to adduce evidence demonstrating common use of the word “Persian” in response to Yarra Valley Dairy’s assertion that the term “Persian Fetta” or “Persian” had previously not been used to describe a type of cheese. On the evidence before the Court, Middleton J held that:
“there is a style or quality of fetta which originates from or is associated with the geographical location then known as Persia”;
“other cheese makers in Iran, Australia, or elsewhere, trading or wishing to trade in Australia, may want to use the word ‘Persia’ or ‘Persian’, on or in connection with fetta, either to signify the style of cheese or to indicate that their cheese comes from the region formerly known as Persia”, “traders would have a legitimate interest in using both the geographical and style name to identify their goods”; and
“there is a likelihood of other traders legitimately wishing to use in Australia the phrase “Persian Fetta” in relation to cheese products in the appropriate circumstance”.
As the “PERSIAN FETTA” trade mark included reference to a geographical location, consideration was given as to whether trade marks referring to a geographical location were inherently adapted to distinguish. Middleton J accepted that this question was to be looked at on a sliding scale and that the cases where trade marks were not registrable were cases in which the geographical location was associated with, or could be associated with, the goods in respect of which registration was sought. Accordingly, context is all important in determining the inherent adaptability of a trade mark to distinguish the relevant goods and/or services.
His Honour held that “it was the YARRA VALLEY DAIRY name and logo of Yarra Valley Dairy’s PERSIAN FETTA and not the words “PERSIAN FETTA” that identified the commercial source or trade origin of Yarra Valley Dairy’s product. Having determined that Lemnos was successful in its counter-claim for removal of “PERSIAN FETTA” there was no need for the Court to consider the claim for trade mark infringement.
The Federal Court decision:
highlights the importance of choosing trade marks that are really inherently adapted to distinguish in relation to the goods and/or services, rather than just relying on extensive use to assert distinctiveness to the Trade Marks Office;
affirms Kitto J’s long-standing test for determining a trade mark’s inherent adaptation to distinguish from Clark Equipment Co v Registrar of Trade Marks (Michigan case) (1964). Namely, that the question to be tested is by reference to the likelihood that other traders, actuated by only proper motives would be likely to need to use the relevant mark in respect of similar goods;
confirms that context is all important in determining whether a geographical location is inherently adapted to distinguish the relevant goods and/or services when used as a trade mark; and
serves as an important reminder not to equate use of a trade mark with distinctiveness. Mere use, will not of itself, establish that a trade mark distinguishes the goods and/or services of one trader from those of another.
If you have any queries in relation to trade marks please contact us:
Scott Sloan | Partner
T +61 2 8233 9554
F +61 2 8233 9555
Stuart Green | Associate
T +61 2 8233 9586
F +61 2 8233 9555
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