We have recently been advising a client in relation to an
alleged trade mark infringement.
The client has been sued in the Federal Court of Australia in
circumstances where they imported items of clothing from Europe for
resale in Australia. The goods were branded with a well-known
international label. Our client purchased the goods, amongst
others, for resale in the belief that they were genuine goods. That
claim is being tested.
Under Australian trade mark law, a registered trade mark is
infringed if it used as a sign that is substantially identical
with, or deceptively similar to the trade mark in respect of which
the goods are registered. The owner of the registered trade mark
has a monopoly over its use in connection with the goods or
services in respect of which it is registered. "Use as a
sign" is an expression that is principally directed to
advertising and marketing material, however it can also apply to
the label sewn into a garment if the label features the registered
Most international fashion brands register their trade marks in
the major territories where they have distribution arrangements.
Usually, their local distributor has the right to use the trade
mark and uses those rights to prevent third parties from promoting
the goods and/or trading off the reputation for the products the
registered trade mark owner has acquired.
The Trade Marks Act 1995 (Cth) provides a defence for
resellers of trade marked goods where the registered trade mark (in
this case the label sewn into a garment) has been applied with the
consent of the trade mark owner at the original point of
manufacture. In other words, if the goods have been manufactured
for or on behalf of the trade mark owner and are genuine goods, a
person who sells goods that feature the registered trade mark does
not infringe the trade mark. In addition, using the trade mark to
advertise or promote the goods would also be permitted, although
copyright issues might arise. In some cases the local distributor
may own the trade mark, in which case the defence may not be
The onus of proving "genuineness" is the
responsibility of the party seeking to rely on the defence. In
practical terms, that will mean obtaining evidence through the
supply chain to demonstrate a direct connection back to the trade
mark owner. In some circumstances, obtaining such evidence may be
difficult. Failure to provide satisfactory evidence will usually
lead to the assessment of damages or loss of profits, injunctions
and significant costs orders.
There have been some recent court decisions which provide some
valuable lessons in this area of law. We are writing about them now
and will publish the content on our website in coming weeks.
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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