Australia: Cadbury Does Not Own the Colour Purple (in Australia, at least)

On 27 April 2006, Justice Heerey of the Australian Federal Court handed down his decision in Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd (No 4).

To quote Justice Heerey "Cadbury does not own the colour purple and does not have an exclusive reputation in purple in connection with chocolate in Australia. Darrell Lea is entitled to use purple, or any other colour, as long as it does not convey to the reasonable consumer the idea that it or its products have some connection with Cadbury."

In his decision, Justice Heerey reproduced a long list of confectionary and chocolate products packaged in the colour purple. It appears that a number of the listed products have been launched since Cadbury first started attempting to enforce IP Rights in purple.

One might suggest that this is copying which underscores the value of the colour to Cadbury and reinforces their enforcement attempts. However, on another view, perhaps the competitor companies (such as Darrell Lea and Nestlé) have moved to make it more difficult for Cadbury to build a monopoly in the colour by adding to the number of purple products on the market and detracting from its ability to distinguish the product as coming from Cadbury.

In an unusual step, Darrell Lea has foreshadowed that they will make an application for indemnity costs against Cadbury.

In the latest of a long list of attempts by Cadbury to assert intellectual property rights in the colour purple, Cadbury had sued Darrell Lea pursuant to allegations of misleading and deceptive conduct in contraventions of ss 52 and 53(c) and (d) of the Trade Practices Act and the common law tort of passing off.

It was common ground between the parties that Darrell Lea products in fact have no sponsorship, approval or connection with Cadbury or its products, and that Darrell Lea’s business is entirely unconnected with that of Cadbury. Consequently, the critical issues in this case related to the representations that, Darrell Lea by its conduct would convey to a hypothetical ordinary and reasonable member of the class constituted by prospective purchasers of chocolate products: Campomar v Sociedad Limitadav Nike International Limited (2000) 202 CLR 45 at [102]-[105].

The court held that the evidence warranted the following findings (amongst others):

• There is wide awareness amongst Australian consumers of the use by Cadbury of a dark purple colour (i) in connection with the marketing, packaging and presentation of certain chocolate products particularly Cadbury Dairy Milk and other block milk chocolate products, and (ii) as a corporate colour.

• Cadbury does not have an exclusive reputation in the use of this dark purple colour in connection with chocolate. Other traders have, with Cadbury’s knowledge, for many years used a similar shade of purple. Cadbury has not consistently enforced its alleged exclusive reputation. In relation to its chief competitor Nestlé, Cadbury has, for its own commercial reasons, permitted a use of purple in relation to popular chocolate products.

• Cadbury markets many chocolate products which have little or no purple in their packaging.

• Cadbury products, regardless of the presence or absence of purple in the packaging, always bear the Cadbury name in a distinctive script.

• Cadbury’s use of purple in marketing advertising and promotion is, and is seen by consumers to be, inextricably bound up with the well known name Cadbury in its distinctive script. Cadbury never uses the colour purple in isolation as an indicium of trade.

• The names Darrell Lea and Cadbury are quite distinct in sound and appearance (especially with the respective scripts the parties have adopted) and not likely to be mistaken for each other.

• Darrell Lea did not adopt the colour purple with the intention of leading consumers to believe its products were Cadbury products or that it, or its products, had some kind of association with Cadbury.

• Most of Darrell Lea’s retailing occurs in premises which its owns or occupies. Other retailing occurs from separate stands or displays in retail premises, such as newsagents, pharmacies, convenience stores and video stores. Darrell Lea has only a minor presence in supermarkets and only, in the past, to a very limited and transient extent in the major chains. Its products are not presented for sale in close proximity to Cadbury's.

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