Australia: V Energy loses a mother of a battle over colour trademark: Australia courts decision in Frucor v Coca-Cola

Last Updated: 14 August 2018
Article by Helen Macpherson and Alyson Poole

We, as consumers, regularly associate colours with our favourite brands as we stroll down supermarket aisles and peer at billboards and banners in shopping centres. But for brand holders, gaining protection for proprietary colours is not a walk in the (green) park. The recent decision of Frucor Beverages Limited v The Coca-Cola Company [2018] FCA 993 marks the end of a lengthy six-year battle over Frucor Beverages Limited's (Frucor's) application for protection of a particular shade of green. The Federal Court's decision proves once again the difficulties that companies face in applying to register colour trade marks, and provides useful lessons for future applicants of colour trade marks to note.

In the beginning... the Trade Marks Office decision

In 2016, The Coca-Cola Company (CCC) opposed an application made by Frucor to register a particular shade of green (described as Pantone 376c), as used on the packaging of Frucor's 'V' energy drinks. The application was made under Australian trade mark no. 1496541. CCC opposed the application, first, on the basis that the evidence or representations which Frucor submitted under section 41(6) of the Trade Marks Act 1995 (the Act) were false in material particulars, and second, on the basis that the colour trade mark itself was not capable of distinguishing under section 41(2) of the Act.

CCC argued, in respect of the first ground, that, in its initial application in 2012, Frucor submitted an incorrect swatch of green which was not representative of the colour Pantone 376c, as claimed. In response, the delegate held that the disconformity between the colour claimed and the swatch submitted was a fatal flaw and was not capable of amendment under section 65(2) of the Act. The delegate also found in favour of CCC in respect of the second ground, holding that Frucor's evidence was not sufficient to establish that the shade of green applied for was capable of distinguishing Frucor's goods from those of other traders. CCC's opposition accordingly received the green light, and registration of Frucor's colour trade mark was refused.

The Federal Court appeal

Green with envy at CCC's win, Frucor appealed the decision to the Federal Court. The three main issues the Court was asked to consider were as follows:

Whether Frucor's failure to comply with section 27(2)(a) of the Act, because of the deficiency in the colour swatch provided, was a ground for which registration of a trade mark could be rejected, and therefore a ground on which the application could be opposed within the meaning of section 57 of the Act.

Justice Yates accepted Frucor's position that the disconformity between the colour claimed and the swatch submitted did not provide an avenue for opposition within the meaning of section 57 of the Act. Although there had been a failure to comply with section 27(2)(a) as a result of the incorrect colour swatch being included with the trade mark application, such a failure was not a ground for rejection of, or opposition to, the trade mark application. The wording of section 57 referred only to those provisions of the Act which identify themselves as "grounds" and a failure to comply with section 27(2)(a) is not identified in the Act as a ground of opposition. Justice Yates did not, however, accept Frucor's submission that a person observing the register would consider the description of the mark (i.e. Pantone 376c) to be a precise identifier of the colour claimed, rather than the swatch representing the mark. Frucor argued that consumers would appreciate that factors such as scanning, printing and matters of that kind might vary the colour representation. Justice Yates was not convinced by such arguments, holding that a person inspecting the register is entitled to assume that the trade mark applicant's own depiction of colour in the representation accompanying the application is indeed accurate.

Whether CCC's ground of opposition under section 41 of the Act was established.

In determining whether Frucor had successfully established its reputation in the Pantone 376c colour (leaving aside the deficiency of the colour swatch provided), his Honour ultimately concluded that Frucor's use of the proposed colour trade mark was descriptive, and not distinctive in the trade mark sense. His Honour took into account the presence of the distinctive 'V' logo used on the 'V' energy products, as well as its consistent use in marketing material, finding that consumers of energy drinks and non-alcoholic beverages would have seen that logo rather than the colour green functioning as the badge of origin.

His Honour also commented on the context in which 'V' energy drinks are sold and marketed. In particular, Justice Yates noted that colour is commonly used to denote product flavours and ranges, and that for Frucor's products, consumers would regard the shade of green as an indication of the core product (with different colours being used for other products within the 'V' range).

Accordingly, the colour did not of itself function as a separate trade mark. Registration of the trade mark was therefore rejected, as the requirement of section 41(6)(a) of the Act was not made out.

Whether the Federal Court had power to amend Frucor's trade mark application to correct the swatch sample submitted pursuant to section 65(2) of the Act

With its last ounce of [V] energy, Frucor sought an order from the Court directing the Registrar to register the mark, provided the representation of the mark attached to the application was amended to show the correct Pantone 376c swatch. His Honour determined however that the Court should not make such an order in this case. This is because the amendment to the representation of the mark would substantially affect its identity. Although Frucor attempted to argue that amending the swatch would merely resolve an ambiguity, his Honour took the view that such an amendment would be "of the most fundamental kind that strikes directly at the identity of the mark". Therefore, his Honour declined to order that the application be amended.

Lessons to be learnt

This case is a timely reminder of the stringent tests to which colour trade marks are subjected, and the unambiguous reputational rights which must be established before a colour trade mark will be granted protection. The key to passing the test with flying colours is to ensure use of the colour is use as a trade mark. That is, as a badge of origin, and not merely as a descriptor of products.

The case also provides clear guidance on the need for trade mark applications to accurately reflect the details of the trade mark being applied for in the trade mark application; and the limitations of both the Office and Courts in correcting inaccurate claims. So, before rolling out the red carpet for your colour trade mark registration, be sure to have attached the correct swatch, to avoid technical pitfalls that may prove fatal.

Despite the effort historically required to obtain colour trade mark rights, there is hope as every once in a blue moon a colour trade mark is successfully registered. However, as Kermit the Frog would say, "it's not easy being green."

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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