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An Australian company operating under the Winnebago name and
logo for more than 25 years has been found to have engaged in
passing off and misleading and deceptive conduct.
Despite an incredible delay in bringing its case to Court, the
Federal Court of Australia has found in favour of a United States
(US) based company Winnebago Industries Inc (Winnebago) in an
action for passing off and misleading and deceptive conduct against
Australian company Knott Investments Pty Ltd (Knott) and its
director Bruce Binns (Binns).
Knott was found to have represented that it had legitimate trade
connections with Winnebago by using Winnebago's name and trade
marks in Australia from 1982. This conduct was exacerbated by
Knott's 1995 advertisement stating, "You'd expect
nothing less from Winnebago, the world's most respected name in
luxury motorhomes".
In finding that Winnebago was entitled to an injunction
restraining Knott from using the Winnebago name and logos, Justice
Foster found that a substantial number of potential customers
looking to rent or buy residential vehicles (RVs) in Australia were
aware of the "Winnebago" name prior to Knott's use of
the name. The Court held that Binns' selection of the Winnebago
name demonstrated his expectation that his business would
financially benefit from an association with Winnebago's
reputation in Australia.
As a result the Court held that Australian consumers were likely
to be deceived into thinking that Knott was associated with
Winnebago and that Knott's RVs were made by Winnebago.
Background
Winnebago had traded under the Winnebago name and logos since
1959, manufacturing its now famous RVs. Knott's director, Binns
encountered Winnebago RVs on a trip to the US, Canada and Mexico.
He subsequently decided to market RVs under the Winnebago name from
his memory of his travels.
From around 1982 onwards, Knott commenced manufacturing and
selling RVs in Australia under the Winnebago name and marked with
Winnebago logos. Knott's use of the Winnebago name and logos
since that time has been extensive – from promotional and
advertising material, to letterheads, invoices, business cards,
signs and magazines.
Winnebago first became aware of Knott's use of the Winnebago
name and marks in May 1985. In 1988 they sought legal advice as to
whether Knott could be restrained from his conduct but formed the
view that nothing could be done.
They made further attempts to prevent Knott from using the
Winnebago name in 1991 which eventually resulted in the signing of
a settlement agreement between Knott and Winnebago. The settlement
agreement provided that Knott could not:
use the Winnebago trade marks in any country other than
Australia
apply for registration of the Winnebago trade marks in any
country
associate itself with Winnebago or its products.
Despite this agreement, Knott registered the Winnebago trade
mark in Australia effective from March 1997. Given his findings as
to Winnebago's reputation in Australia prior to registration of
Knott's trade mark in 1997, Justice Foster ordered that
Knott's trade mark registration be cancelled. As a result,
Knott will be required to rebrand their business.
Justice Foster found Binns was not credible in cross examination
when he said he was not trying to trade off the goodwill and
reputation of Winnebago. Rather he found that the decision to use
the name and marks was motivated by an appreciation that this would
benefit Knott financially. He stated that Winnebago's marks
were intentionally hijacked "in a bold attempt to pre-empt
Winnebago's opening its doors [in Australia]".
Delay
Knott attempted to argue that relief should be refused because
of the extraordinary delay of Winnebago in bringing the action.
Knott argued that Winnebago had allowed Knott to develop their
business in full knowledge that they were trading under the name
Winnebago.
Justice Foster accepted Winnebago's evidence that they did
not wish to enter into costly litigation at a time when they had no
intention of exporting their products into the Australian market.
He concluded that this delay did not amount to a proper basis for
refusing the relief sought.
Conclusion
The case reinforces that overseas companies will be able to
prevent businesses in Australia from trading off their reputation.
This is so even if the foreign company has not commenced trading in
Australia, provided they can establish they have some reputation in
the Australian market.
If you would like to know more about your options in that
regard, please contact Middletons' Intellectual Property
team.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
Middletons has been awarded a 2012 EOWA Employer of Choice for
Women citation acknowledging our commitment to workplace
diversity.
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