The Granola case shows how hard it is for companies to
establish their unique word marks have been infringed when they
have otherwise come to have a meaning of their own.
The recent Federal Court decision in Australian Health &
Nutrition Association Ltd trading as Sanitarium Health Food Company
v Irrewarra Estate Pty Ltd trading as Irrewarra Sourdough 
FCA 592 demonstrates the difficulty of establishing trade mark
infringement when a registered trade mark is used
In this decision, the Australian Health & Nutrition
Association Ltd trading as Sanitarium Health Food Company lost a
claim for trade mark infringement against Irrewarra Estate Pty Ltd
trading as Irrewarra Sourdough over Irrewarra's use the word
"Granola" has been a registered trade mark since 1921
in respect of goods in class 30 (which includes preparations made
from cereals). Sanitarium is authorised to use the Granola mark,
Irrewarra is not.
Irrewarra is a manufacturer and distributor of wholesaler breads
and baked goods, including a cereal product which Sanitarium argued
infringed the Granola mark. The cereal product in question has been
sold by Irrewarra in a clear plastic bag since 2004 with a front
label showing the Irrewarra trade mark above the words "All
Natural Handmade Granola".
Sanitarium argued that Irrewarra's use of the Granola mark
in this way contravened the Trade Marks Act 1995. Irrewarra denied
both that it had used the Granola mark and that its use of the term
"Granola" on its labels was as a trade mark (ie. in the
sense of a word distinguishing its goods from the goods of other
traders in the course of trade). It argued that its use of the word
"Granola" was purely descriptive and did nothing more
than describe the contents of the package.
Having considered the cereal product in question, Justice Jagot
concluded that the label was not substantially identical with or
deceptively similar to the Granola mark. In coming to this
conclusion she noted that the word "granola", although
invented, was inherently suggestive of meaning a grain product.
Justice Jagot did not accept that any use of the word
"granola" on a cereal product must be a trade mark use.
Nor did she accept that the term granola had no meaning in
Australia such that it could not be a descriptive term.
In the context of the packaging it would be clear to a consumer
that the "all natural handmade granola" on the label
merely referred to the contents of the Irrewarra package. This was
especially the case given that the word granola did not appear in
isolation on the package, but rather alongside the words "all
natural handmade" which are themselves plainly descriptive of
the Irrewarra product.
Accordingly, Sanitarium failed to demonstrate that
Irrewarra's use of the term was intended to distinguish its
goods from those of any other person in the course of trade. The
word "Granola" as it appeared on the goods in question
was merely as a means of describing the contents of the package and
did not therefore indicate any connection between the goods and
Irrewarra sufficient to be likely to deceive or cause confusion
about the origins of granola. Justice Jagot was therefore satisfied
that Irrewarra were not using the word "Granola" as a
trade mark on any of their products.
This case demonstrates the difficulty companies face in
establishing trade mark infringement in respect of unique word
marks that have otherwise come to have a meaning of their own. As
demonstrated above, mere use of a registered trade mark by a
competitor will not necessarily constitute an actionable
infringement where a registered mark could be considered to be
generally descriptive. To succeed, a party must show that the
infringing party's use of the mark is not merely as a means of
describing its products, but rather as a means of distinguishing
its goods from those of another manufacturer.
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
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