Australia: Let's go to Thredbo in the Winnebago and find some trade marks and what they can and can't do for you - Part 1

Last Updated: 15 September 2013
Article by Susan Gatford

In this series of three articles I will focus on some of this year's Federal Court cases to explore what makes a good trade mark, how registering a trade mark can help as well as some of the more, and less, usual orders and remedies a Court can provide. The names of the trade marks that are the subject of these cases all appear in the title to the article. The cases' full names and citations are
Thredbo - Kosciusko Thredbo v ThredboNet Marketing [2013] FCA 562 - REA Group Ltd v Real Estate 1 Ltd [2013] FCA 559
Winnebago - Knott Investments v Winnebago Industries [2013] FCAFC 59

Topic one - A little caution with descriptive trademarks

In Kosciusko Thredbo v ThredboNet Marketing [2013] FCA 562 the perils of adopting a descriptive trade mark are on clear display.

It is common and understandable to name a new service by reference to what it is and where it is. The benefits of doing so are obvious - the name tells people exactly what you need them to know. The name "Thredbo accommodation", for example, would tell the world the nature of your business.

The down side is that you have chosen a name that others are likely to use as well. It doesn't mark you out from the pack and if someone else opens up a similar service with the same name how will people tell you apart? But what, if you are the first and only person on the market offering the relevant services? Can you adopt a descriptive name, make it distinctive of you, and then stop others from starting to use it because of the potential confusion?

Thredbo is a name of aboriginal origin and is historically linked to the area in which the Thredbo resort was developed. When the Applicant took over the head lease and management rights to Thredbo village from Lend Lease in 1987 it sought to monopolise the geographic name and make it synonymous with itself. The Applicant called itself Kosciusko Thredbo and used the name Thredbo in all its subsidiary companies, as well as the domain name "" and various other domains that included the word Thredbo. It also included in its leases of all properties on the mountain a restraint on any tenant using or permitting the use of the word "Thredbo" in connection with any business.

The Respondent started in a small way, leasing out a handful of apartments on the mountain. It initially used the domain names "" and "", then later "", which it purchased in an online auction for $10,000. The Applicant was aware of the auction but chose not to participate. It also didn't, at the time of the trial, have any registered trade marks, and so had to rely on its common law rights and on the misleading and deceptive conduct provisions of the Australian Consumer Law.

There were similarities between the Applicant's and Respondent's websites (similar phrases, similar fonts, similar photos, the use of the colour red) and there was evidence that some people had been confused as to who they had been dealing with. The Court said, however, that although there was extensive evidence of use of the Thredbo name by the Applicant, the nature of that use was largely descriptive. Because of that the claim failed, and the Respondent was allowed to keep using the Thredbo name. In practical terms this meant that the Applicant's marketing and promotion of its name were of benefit not just to itself but also to its business rivals on the mountain such as the Respondent.

In relation to the "no Thredbo" clause in the leases, the Court outlined the various restraint of trade tests then adopted the trading society test on the basis that it "has had the fewest aspersions cast upon it by the High Court". It found that the clause was an unreasonable restraint of trade because it restricted the Respondent from "the common right of the public to make honest use of words forming part of the common heritage for the sake of the signification which they ordinarily possess."

Thredbo is a timely reminder that geographical and descriptive names are often not the best choice as the building blocks of a brand development strategy. There are, however, cases based on descriptive name trade marks in which Applicants have fared better. The next article in this series will look at the case and contrast it with Thredbo.

Susan Gatford is barrister on Gordon & Jackson's list at the Victorian Bar. She practices out of Owen Dixon Chambers in Melbourne and is also a registered trade mark attorney. [] © Susan Gatford 2013

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.

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