The decision of Greenwood J in Mayne Industries Pty Ltd v Advanced Engineering Group Pty Ltd  FCA 27 was delivered on 23 January 2008 (the "Judgment").
The Judgment considers whether:
- the Respondent infringed a trade mark comprising a sign being a three-dimensional shape (an S loop);
- the features of the shape bear any relation to the function to be performed by the loop or the nature of the goods; and
- the importation of articles embodying the shape for sale and distribution and promotion through the use of advertising brochures is use of the trade mark, as a trade mark.
The Judgment illustrates that the Trademarks Act 1995 (Cth) (the "Act") cannot be relied on to provide enduring exclusive rights to protect an article previously protected under a patent. The Judgment suggests that the Act is particularly unreliable in providing exclusive rights where the actual sign is the only commonly known way of describing the article.
The proceedings involved a trade mark over a galvanised spring wire contraption (known in the farming industry as a fence dropper') crafted into an S' bend shape when attached to a fence (usually restraining livestock) engages the horizontal wires of a fence, cleverly allowing strength, preventing fence distortion and basically acting as a substitute for fence posts. The combined effect of the fence dropper' is a durable yet flexible fence that can withstand the brunt of unruly animal activity.
Originally patented under the Patents Act 1952 (Cth), the patent for which expired on 8 October 1984, the S loop was registered by the Applicant as a trade mark on 18 May 2001. The S shape is depicted in the schedule in the Certificate of Trade Mark.
Summary of Claim
The Applicant claimed the Respondent infringed its trade mark by importing for sale and distribution products embodying the S loop shape trademarked by the Applicant. The Respondent promoted its fence-supporting wares through the use of advertising brochures showing pictures of a rod bent into an S shaped loop. The brochures also explained how the device operates.
The Applicant claimed the Respondents products and picture brochure were substantially identical to its trademarked S shaped loop sign. The Applicant claimed such use by the Respondent was use as a trade mark (under s 120 of the Act).
In a separate trial, the applicant sought relief under section 52 and 53 of the Trade Practices Act 1974 and for passing off.
Summary of Defence and Cross-Claim.
The Respondent Cross Claimant relied on a defence under S 25 of the Act (regarding a trade mark relating to article etc formerly manufactured under patent) which states a registered owner of a trade mark does not have exclusive rights to use or authorise other persons to use a trade mark in relation to the article of the same description. The Respondent pleaded that a trade mark consisting of or containing a three dimensional shape cannot describe' an article (formerly exploited under a patent) as only words can do that and the trade mark in question is not a word mark, and, in these circumstances, it also serves a functional purpose.
The Respondent claimed that, by this logic, it followed that once it was demonstrated that the shape serves some functional purpose, use of the shape (the trade mark) cannot be use as a trade mark.
The Respondent Cross-Claimant bought its cross-claim as a person aggrieved' and sought:
- A declaration in reliance upon s 24(3) of the Act1;
- A declaration that the registered mark consists of, or contains, a sign that describes or is the name of an article or substance that was formerly exploited under a patent (the "Expired Patent");
- Further (or alternatively) a declaration that the owner has no exclusive right to use, or authorise others to use the sign in relation to the article of substance or other goods of the same description from the end of the period of 2 years after the Expired Patent ceased or expired; and
- A declaration that any previous, existing or continued use of the registered mark by the Cross-Claimant is permitted pursuant to any of ss 120(2) 122(1)(b)(i), 122(1)(c) and 122(1)(e), ss24 (abandoned) and/or ss25 of the Act.2
The Respondent Cross-Claimant sought (pursuant to s 87(1) of the Act) that the Register of Trade Marks be rectified by cancelling the Applicant Cross-Respondent's Trade Mark.
Greenwood J considered the use of the S loop as a shape and as a trade mark. His Honour considered the elements of s 120, whether s 25 applied, whether the trade mark consisted of a sign that describes or is the name of an article formerly exploited under a patent, the effect of s 25 and the existence of exclusive rights of the Registered Owner (of the former patent), whether a shape is capable of describing' an article formerly exploited under a patent and whether a shape is capable of being the name of an article formerly exploited under a patent. S 122 relating to use of the sign by the Respondent in good faith' was also considered.
Although Greenwood J found the S loop comprising part of the Respondent's fence dropper was substantially identical to the Applicant's trade mark, infringing use of a trademark is limited to use as a trade mark (as a badge of origin, s 120 the Act). The Respondent, in using the three dimensional S shape sign in relation to goods by importation, sale and promotion of articles, and having its one and only brochure endorsed on the back and front with a photograph of a fence dropper in action, was found not to constitute use of the shape as a trade mark, nor was it found that importing for sale a dropper that contains an S loop constitutes use as a trade mark.
The Court held, by reason of the application of s 25 of the Act, the Applicant registered owner of the trade mark did not have any exclusive rights to use or authorise other persons to use the trade mark in relation to the fence dropper formerly exploited as a patent under the Patents Act.
The Court cancelled the registration of the Applicant's shape mark on the grounds that, by registering the S bend as such, the Applicant effectively sought to extend the term of the patent's exclusivity, which expired long ago.
In light of the Judgment, the short answer to the title of this FocusPaper is, invariably, no. A shape trade mark cannot be used to extend expired patent rights, especially in circumstances where the actual sign is the only real way of describing the article.
The assistance of Mandy Chapman, Solicitor, in writing this article is appreciated.
1 Relief based on s 24 was abandoned. S 24 states: Trade mark consisting of sign that becomes accepted as sign describing article etc. (1) This section applies if a registered trade mark consists of, or contains, a sign that, after the date of registration of the trade mark, becomes generally accepted within the relevant trade as the sign that describes or is the name of an article, substance or service. (2) If the trade mark consists of the sign, the registered owner: (a) does not have any exclusive rights to use, or authorise other persons to use, the trade mark in relation to: (i) the article or substance or other goods of the same description; or (ii) the service or other services of the same description; and (b) is taken to have ceased to have those exclusive rights from and including the day determined by the court under subsection (4). (3) If the trade mark contains the sign, the registered owner: (a) does not have any exclusive rights to use, or authorise other persons to use, the sign in relation to: (i) the article or substance or other goods of the same description; or (ii) the service or other services of the same description; and (b) is taken to have ceased to have those exclusive rights from the day determined by the court under subsection (4). (4) For the purposes of subsections (2) and (3), a prescribed court may determine the day on which a sign first became generally accepted within the relevant trade as the sign that describes or is the name of the article, substance or service.
2 Section 122(1)(e) provides that a person does not infringe a registered trade mark when: (e) the person exercises a right to use a trade mark given to the person under this Act ...'; Section 120(2) provides for infringement of a registered trade mark if the person uses as a trade mark a sign that is substantially identical with a trade mark in relation to goods of the same description as the goods in respect of which the trade mark is registered; Section 120(2) contains a qualification in these terms: However, the person is not taken to have infringed the trade mark if the person establishes that using the sign as the person did is not likely to deceive or cause confusion.
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