Trade Marks the new Mantra for Property Industry

In the recent decision of Mantra Group Pty Ltd v Tailly Pty Ltd (No 2) [2010] FCA 291, Reeves J of the Federal Court ordered that domain names incorporating, or similar, to the words “CIRCLE ON CAVILL” be transferred to Mantra Group (“Mantra”) as the owner of the “CIRCLE ON CAVILL” trade mark and that the respondent Tailly, be permanently restrained from using the words as a trade mark in the advertising, promotion or supply of accommodation, including as part of a domain name, meta-tag, search engine keyword or as a business name.

At the centre of the case was a strata-titled apartment complex named “Circle on Cavill” located at Surfers Paradise, Queensland. As the exclusive onsite letting agent appointed by the body corporate for the complex and owner of Australian trade mark registrations covering “management services including property management, realty administration and leasing services excluding those pertaining exclusively to shopping centres and retail stores” and the “provision of temporary accommodation; rental of temporary accommodation; reservation services for temporary accommodation”, Mantra owned the rights to manage and let apartments in the complex.

Tailly leased apartments in the same “Circle on Cavill” complex from owners of the apartments and then sought to sub-let these apartments to holiday-makers through a large number of websites accessible at domains that were similar to, or deliberate misspellings of, “Circle on Cavill”.

Mantra contended that Tailly’s use of “Circle on Cavill” in the banner, title and text and in the meta-tags or source code of the websites as well as use of terms similar to “Circle on Cavill” as keywords for Google advertisements, infringed Mantra’s trade mark registrations and was likely to mislead or deceive consumers in contravention of s52 of the Trade Practices Act.

In its defence, Tailly asserted that its use of the phrase “Circle on Cavill” was use in good faith intended to indicate the geographical location of its apartments and services and that it was entitled to use the generic phrase “Circle on Cavill” as it sub-let apartments in the complex and the name of the building and indeed the body corporate was “Circle on Cavill”.

Reeves J held that:

• “Circle on Cavill” was not a generic term;
• Tailly had used “Circle on Cavill” as a badge of origin in website banners and headings, and that such use infringed Mantra’s registered trade marks;
• the term “geographical origin” referred to the name of a country, region, city, town or similar geographical area, but did not extend to a building;
• Tailly had not acted in good faith when deciding to use “Circle on Cavill”; and
• Tailly had to pay Mantra its profits for bookings obtained via websites accessible at the domain names incorporating, or similar, to the words “CIRCLE ON CAVILL”.

Take Away

The Federal Court’s decision highlights the importance of obtaining and maintaining trade mark registration while sending a clear message that unauthorised use of a trade mark as part of a domain name will in all likelihood result in the transfer of the domain name to the trade mark owner if the website accessible at the domain name offers goods or services in respect of which the trade mark is registered.

Should you have any queries about this case or wish to discuss what action you can take to protect your valuable intellectual property please contact a member of DibbsBarker’s Intellectual Property and Technology team.