A recent decision of the Full Federal Court highlights the
benefits to be obtained from registering a trade mark prior to
commencing business, and the potential expense and inconvenience in
enforcing your rights without a registration.
In Hansen Beverage Company v Bickfords (Australia) Pty Ltd
 FCAFC 181, the appellant (Hansen) had manufactured and
sold an energy drink under the brand MONSTER ENERGY since 2002.
Sales were primarily in the United States, South and Central
America and the Caribbean. The MONSTER ENERGY drinks had not been
sold (other than via eBay) or directly promoted in
Australia. Hansen had, however, engaged in "indirect
advertising" and used the mark MONSTER ENERGY in the
sponsorship of athletes, athletic competitions, music festivals and
musicians to promote this product prior to launch in Australia.
Hansen's activities were directed at raising awareness of its
product among young adult males, specifically those aged 18
– 30 years.
The respondent (Bickfords) conducted trade mark searches which
revealed that Hansen had no Australian registrations or
applications for MONSTER or MONSTER ENERGY. Bickfords therefore
proceeded to file applications to register each of MONSTER and
MONSTER ENERGY as an Australian trade mark in 2005. Bickfords then
commenced using the brand MONSTER ENERGY in Australia from 2006 for
its own energy drink. Bickfords' MONSTER ENERGY branded drink
was also targeted towards young adult males.
Hansen commenced Federal Court proceedings against Bickfords
seeking injunctions and damages against Bickfords. Without a
relevant trade mark registration, Hansen could only rely on claims
for "passing off" and contravention of section 52 of the
Trade Practices Act 1974 which prevents a corporation from
engaging in conduct that is misleading or deceptive or is likely to
mislead or deceive.
There was no dispute in this case that the energy drinks of
Hansen and Bickfords were similar, and that such similarity could
mislead and deceive. The issue in this case was whether Hansen had
established sufficient reputation in the marks MONSTER ENERGY and
MONSTER in Australia in relation to energy drinks to support its
claims. The trial judge found that Hansen had not established the
sufficient reputation within its "target market" in
Australia. Hansen appealed this decision to the Full Federal
The Full Federal Court did not make a decision on the issue of
reputation but allowed the appeal on the basis that the trial judge
had erred in requiring Hansen to establish relevant reputation
specifically within its "target market" of males aged 18
– 30. The Full Court found that instead, the relevant
group for assessing the reputation of Hansen's MONSTER ENERGY
branded product was the broader Australian community. The Full
Court has remitted this matter back to the trial judge for further
If Hansen had registered its trade mark MONSTER ENERGY in
Australia, Hansen could have relied on a claim of trade mark
infringement, given the brand used by Hansen and Bickfords were
identical (MONSTER ENERGY) as were the goods in relation to which
each was using this brand (ie energy drinks). Instead, Hansen was
required to establish that it had the relevant reputation in its
MONSTER ENERGY mark and that Bickfords' use of this mark (and
other similar product features) was likely to mislead or deceive.
Compiling evidence of sufficient reputation is often a lengthy and
expensive process and may require input from third parties and/or
the collection of survey evidence. This process can be avoided if a
relevant trade mark registration is held. In this case, to enforce
its rights, Hansen has undergone the expense (both financial and
time) of a Federal Court trial and a Full Federal Court appeal and,
now, appears destined for a further hearing before the trial judge.
In separate proceedings before the Trade Marks Office, Hansen also
opposed the applications by Bickfords to register the marks MONSTER
and MONSTER ENERGY in Australia.
While filing a trade mark application can often be seen as an
unnecessary expense when launching a new brand, or an existing
brand in a new country, as this case highlights, investment at this
early stage can often avoid much greater expenses when attempting
to enforce your rights. The registration of a trade mark also
provides a degree of certainty that you will have the exclusive
right to use your brand in relation to the goods or services
covered by a trade mark registration. While there is obviously a
need, particularly in a rapidly expanding business, to be somewhat
strategic in making brand protection decisions, obtaining a trade
mark registration (at least for key brands) prior to launching the
brand is well worth the effort.
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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