By Michael Morris, Senior Associate and Marcelo de
A recent Federal Court case demonstrates how effective trade
mark registration can be in providing a competitive edge in the
marketplace. The case, Mantra Group Pty Ltd v Tailly Pty Ltd,
considered the use of trade marks on the internet in the context of
the real estate industry.
The background to this case
Circle on Cavill is a residential apartment and retail complex
located in Surfers Paradise on the Gold Coast.
Mantra Group is the exclusive on-site letting agent, although
some apartments in the building are marketed through other real
estate agents. Mantra is also the registered owner of three trade
marks incorporating the words 'Circle on Cavill' relating
to property management and accommodation services. Tailly is a real
estate agent offering short-term accommodation in apartments
located in Circle on Cavill. In the course of its business it:
held a number of website domain names containing the words
'Circle on Cavill' and 'Mantra', used to advertise
and market apartments located in the building;
paid for internet keyword advertisements (such as through
Google's Adwords program) using the words 'Circle on
Cavil' to market apartments using components of the registered
trade marks owned by Mantra;
used Mantra's logo marks in some of its letter heads to
offer real estate services for apartments located at Circle on
extensively incorporated the words 'Circle on Cavill'
and 'Mantra' as metatags in its websites. Mantra sued
Tailly for infringement of its trade marks and for breaches of the
Trade Practices Act 1974.
The issues in Mantra Group v Tailly
The main issues considered in this case were whether:
Tailly's use of the words 'Circle on Cavill' and
'Mantra' on the internet was use "as a trade
the words 'Circle on Cavill' became descriptive of that
building to the real estate industry; and
Tailly lawfully used these words to describe the geographical
location of the apartments offered on its websites.
The findings in Mantra Group v Tailly
Reeves J found that words used prominently in websites (such as
in banners) amount to "use as a badge of origin of goods and
services", as opposed to a mere reference to where the
apartments are located. His Honour also found that even though the
extensive use of the words as metatags is not use as a badge of
origin, it can amount to use in bad faith, which mitigates
available defences for trade mark infringement claims. Importantly,
His Honour found that Tailly's use of the trade marked building
name could not be taken as a mere reference to the geographical
origin of the apartments marketed through its websites and
This case serves as a reminder that owners who register building
name trade marks essentially have monopoly rights, as they are
entitled to prevent competitors from using the name, even if the
competitor also deals with property located in the building.
As a licensor or a licensee, here are some tips you should consider when negotiating your next licence agreement.
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