On 21 May 2007, the Full Court of the Federal Court handed down its judgment in Cadbury Schweppes Pty Ltd –v– Darrell Lea Chocolate Shops Pty Ltd.
Cadbury has challenged Darrell Lea’s use of the colour purple, which is a long-established, and widely recognised, element of Cadbury’s chocolate branding. Cadbury has a long way to go to prove its case, which has been sent back to the original judge for retrial. However, its chances of success have improved slightly since the Full Court held that under section 52 of the Trade Practices Act, misleading and deceptive conduct does not require that there be any exclusivity in the use of the branding element in question.
This means that Darrell Lea’s use of the colour purple may constitute misleading and deceptive conduct, even though the same, or similar colour may be regularly used by other businesses, even by competitors, like Nestlé.
This reaffirmation of the wider protection afforded by s52 when compared with the common law tort of passing off may be both good and bad news for businesses. Businesses may be subject to, or may bring an action for misleading and deceptive conduct against other traders, if branding elements used by one business have been used by another. To succeed however, the branding element must "have been identified in a special way with that trader in the minds of the members of the public".
Branding elements can include anything from a business’ use of colour, shapes and images, to marketing themes, packaging, logos and registered trade marks.
Businesses should be wary that their own branding or marketing campaigns do not infringe another trader’s use of the same, or even similar, branding elements. Likewise, they should monitor the activity of their competitors to ensure that they do not abuse their established branding elements.
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.
