Australia: The dangers of descriptive trade marks

Last Updated: 16 March 2017
Article by Stuart Green
Services: Intellectual Property & Technology

What you need to know

  • Brand owners can sometimes be tempted to seek trade mark registration for brands that include 'descriptive elements', being those that describe the goods or services for which protection is sought.
  • A recent decision of the Australian Trade Marks Office demonstrates the risks in taking this approach, as a descriptive trade mark can be difficult to enforce against third parties.
  • Australian brand owners should exercise caution when seeking to register marks that incorporate descriptive elements, and should focus on investing in marks that distinguish their goods and services from those of other traders.

A recent decision of the Australian Trade Marks Office provides a timely reminder for Australian brand owners about the risks involved in choosing brands that incorporate elements commonly used to describe the goods or services sought to be protected.1 Taking this approach can ultimately make it difficult to restrict others from using those elements in their own brands for similar goods or services.

Background

British-based company Sake No Hana Limited (the Applicant) sought to extend protection of its international registration for the mark SAKE NO HANA, to achieve protection in Australia for a wide range of hospitality services in class 43 including provision of food and drink, restaurant services and accommodation services.

The Trade Marks Office examined the Applicant's trade mark in the usual manner and the application was accepted without objection. However, when the mark's acceptance was advertised in September 2014, it caught the attention of another party.

Opposition

Urban Purveyor Group Pty Ltd (the Opponent) is the owner of three well-known Australian trade mark registrations covering restaurants in class 43, all registered since June 2010:

Registration No. Trade Mark
1368276
1368278
1368280

The Opponent sought to oppose the Applicant's registration of SAKE NO HANA, relying on sections 42(b), 44 and 60 of the Trade Marks Act 1995 (Cth). Specifically, the Opponent argued that:

  • SAKE NO HANA was deceptively similar to the Opponent's stylised SAKE trade marks because the element 'SAKE' was shared by both marks, and Australian consumers would:
    • assume that the services provided under the respective trade marks originated from the same trader
    • shorten the Applicant's trade mark to 'SAKE'
    • incorrectly assume that the Applicant's SAKE NO HANA trade mark is a brand extension of the Opponent's SAKE brand.
  • The Opponent had a significant reputation in the SAKE brand and restaurants, which it sought to prove through a variety of evidence including articles, annual revenue and marketing expenditure for the Saké Restaurants, references to industry awards and the appearance of the executive chef of the Saké restaurants on an episode of the Masterchef television program in 2012. As a result of that reputation, the Applicant's use and registration of the SAKE NO HANA trade mark would be likely to deceive or cause confusion.
  • The Opponent's use of SAKE NO HANA contravened section 18 of the Australian Consumer Law, as it was likely to mislead or deceive Australian consumers.

The decision of the Trade Marks Office

The Trade Marks Office rejected the Opponent's submissions, with the Hearing Officer noting that:

  • the Opponent had failed to establish that there was a real and tangible danger of confusion between the respective trade marks, given that 'SAKE' is a commonly understood word in Australia that is directly descriptive for goods such as rice wine in class 33, and also has some descriptive relevance when used in relation to restaurants and similar services – as a result, Australian consumers would not necessarily assume that trade marks containing the word 'SAKE' denoted the same trader
  • when considered as a whole, significant aural and visual differences between the trade marks can diminish the presence of the first word which leads to a different overall impression of the trade marks
  • if Australian consumers were to shorten the SAKE NO HANA trade mark, they would shorten it to the most memorable element which, given the descriptive nature of SAKE, would in this case be 'NO HANA'.

Even though the Opponent was able to prove varying degrees of reputation in the SAKE trade marks relying on the variety of evidence it submitted, there was no likelihood of confusion for the reasons set out above.

Key takeaways

  • Australian brand owners would be wise to invest in trade marks that serve to distinguish their goods and services from other traders, rather than those that directly describe or have relevance to their goods or services.
  • When using a trade mark that includes a directly descriptive element that is commonly used by other traders, or has descriptive meaning in relation to the designated goods or services, it may be possible to secure registration by incorporating additional distinctive elements. However, even if registration is achieved, it will be difficult to rely on that registration to actively and effectively enforce rights against another party.

Footnotes

1 Urban Purveyor Group Pty Ltd v Sake No Hana Limited [2016] ATMO 95

This article is intended to provide commentary and general information. It 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 article. Authors listed may not be admitted in all states and territories

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Stuart Green
 
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