Protecting an Unregistered Trade Mark and Passing Off
Trade marks need not be registered in Australia. Trade mark rights can be established either by use or by registration. At common law, a person who uses a trade mark first may acquire ownership in it because of the goodwill or reputation attached to it. At common law, therefore, a person who uses a trade mark may thereby acquire the right to preclude its use by others, that right, however, is an adjunct of the goodwill of the business in which the trade mark is used.
Remedy for Breach of Common Law Right of Trade Mark Ownership
The remedy for breach of the common law right of trade mark ownership is an action for Passing Off. The gist of the action is injury to the plaintiff’s business and as a remedy it may not suffice that the plaintiff was the first to adopt the trade mark. Proving reputation has its difficulties. An action for Passing Off essentially offers a trader a right to prevent another trader from passing off another trader’s goods as his or her own.
Lord Herschell in Reddaway v Banham observed:
I am unable to see why a man should be allowed in this way more than any other to deceive purchasers into the belief that they are getting what they are not, and thus to filch the business of a rival.
Core Elements of establishing Passing Off
The core elements that must be shown by the plaintiff are:
- A reputation
The plaintiff has an established reputation or goodwill (in Australia) in the relevant indicia;
There is or there will be misrepresentation by the defendant that its goods or services are those of the plaintiff’s whereby confusion or deception is likely to be created for the relevant public; and
There is actual or is likely to be damage to the plaintiff’s goodwill or reputation as a result of the above.
Passing Off may also constitute beach of the consumer protection provisions in the Australian Consumer Law (‘the ACL’). However, here again it is necessary that the trade mark is sufficiently well-known in Australia so that the use of it by another is likely to mislead and deceive.
Both under the common law and under the ACL, there must be proved a degree of reputation to support an action. Proving damages requires showing that the misrepresentation has caused or threatens damage to your business, reputation or goodwill.
Proving the elements of reputation, misrepresentation and damage is necessary to prevent undue restrictions on competition.
Benefits of a registered Trade Mark
It is always best to have your trade mark registered. While the common law provides for ownership of trade marks without registration where there is proof of reputation, registration has notable advantages. Primarily, it offers prima facie proof of ownership without having to prove the core elements of reputation, misrepresentation and damage.
A registered owner of a trade mark may take action for infringement without establishing any degree of use or market reputation at all. Furthermore, a registered trade mark is a defence to any later allegations of trade mark infringement.
Jaclyn-Mae Floro, BCompSc
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Disclaimer. The material in this post represents general information only and should not be taken to be legal advice.