Australian Trademark Law: Lessons from Ozemite

A trademark is defined in the Trade Marks Act 1995 (Cth) as ‘a sign used, or intended to be used, to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person.’  Trademarks often form a significant part of a brand, and frequently represent a significant investment. Protecting trademarks from appropriation or misuse by third parties is vital to their continued use. A recent case involving the ‘Ozemite’ trademark highlights the importance of trademark use, and provides guidance as to when a trademark can be removed from the Register for non-use.

When can a trademark be removed from the Register for non-use?

As with some other forms of intellectual property, protection of trademarks is achieved by registration with IP Australia.  Once registered, the owner of the mark is entitled to restrain others from using a sign that is substantially identical with, or deceptively similar to, the registered mark in relation to classes of goods or services that the registered mark is used in connection with.

It is a necessity of registration that the sign must either be used or intended to be used to distinguish goods or services in the course of trade.  But what happens when a previously registered trademark is no longer in use?  If dormant, the sign has ceased to satisfy a basic condition of eligibility for registration as a trademark. Yet as long as the mark remains on the Register, the registered owner may restrain other parties from use of a similar sign.

To overcome potential conflicts, the Trade Marks Act makes provision for a person to apply to have a trademark removed from the Register when the mark has remained registered for a continuous period of three years, during which time the registered owner has not used the trademark in Australia.  If such an application is made, and the registered owner wishes to oppose the removal, the owner must prove use of the trademark during the three-year period.

What is trademark use? – The Ozemite trademark battle

The concept of “use” of a trademark may be broader than it first seems.  The recent Federal Court case of Dick Smith Investments Pty Ltd v Ramsey

[2016] FCA 939 provides guidance on the scope of possible trademark use, including in cases where no goods associated with the trademark have actually been produced for sale.

The case concerned an appeal by Dick Smith Investments Pty Ltd (‘DSI’) of a decision to remove its registered trademark Ozemite from the Register. The application was brought by Mr Roger Ramsey, the registered owner of the trademark AussieMite.  Both marks were registered for use in connection with yeast based spreads, and had been developed as an Australian owned alternative to Vegemite.

Mr Ramsey had applied for removal of the Ozemite mark on the basis that the mark had not been used between 1 May 2008 and 1 May 2011.  The Ozemite product was not available for sale at any time during this period. DSI registered the Ozemite trademark on 23 October 2003, but the product first became available for sale in the middle of 2012.  DSI claimed the delay was due to difficulties in developing a formula for Ozemite that was close in taste and texture to Vegemite.  Despite this delay, DSI claimed that the Ozemite trademark had been used throughout the period from registration until the time the product became available for sale.

Katzmann J agreed that DSI had used the registered mark during the development of the product, including between May 2008 and May 2011. Her Honour concluded that promotion undertaken by DSI using the Ozemite mark, in circumstances where evidence suggested that DSI had every intention of making the product ready for sale, demonstrated use in the course of producing and preparing goods for market. On this basis, DSI successfully retained its trademark registration.

Lessons from the Ozemite litigation

The outcome in Dick Smith Investments Pty Ltd v Ramsey gives a valuable lesson for current and future trademark owners. For a business developing goods or services, the case is a reminder that a finished product is not a necessary condition for registration of a trademark. If a sign is used in a commercial sense in connection with either a finished or developing product, a business or individual may be able to register and protect that sign as a trademark. This is valuable in keeping competitors from misappropriating similar signs when a product is in its infancy and vying for a share of the market.

Likewise, for businesses interested in using a mark currently registered to another party, this case demonstrates the importance of understanding the objective intention behind the registered party’s use of the mark. For the trademark to be maintained, evidence must support a conclusion that the mark is or will be used in connection with an actual product. An application to remove a registered mark should be considered in cases where the registered owner does not appear to have any plan to bring their product to market, or is using the mark in a manner unconnected with the class of goods or services it is registered in relation to.

Trademarks represent a valuable opportunity to protect the intangible identity of a business.  Proper understanding of the relevant laws can prevent a competitor from retaining the benefit of protection where their trademark use is artificial and unrelated to the course of their business.

Do you wish to explore using trademarks to protect the brand of a current or developing product? Do you think you have found an unused trademark that conflicts with your trademark? Please contact us on (02) 4929 7002 or fill out an enquiry form if you need assistance with trademarks in your Newcastle or Sydney based business.

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