ARTICLE
17 September 2024

Trade mark infringement: is reputation relevant to assessing deceptive similarity?

CG
Cooper Grace Ward

Contributor

Established in 1980, Cooper Grace Ward is a leading independent law firm in Brisbane with over 20 partners and 200 team members. They offer a wide range of commercial legal services with a focus on corporate, commercial, property, litigation, insurance, tax, and family law. Their specialized team works across various industries, providing exceptional client service and fostering a strong team culture.
Recent HC decision regarding the role of reputation provides much needed clarity for both TM holders & the TM registration office.
Australia Intellectual Property

Facts

The case of Self Care IP Holdings Pty Ltd v. Allergan Australia Pty Ltd [2023] HCA 8, involved two companies in the pharmaceutical industry, Self Care IP Holdings Pty Ltd and Allergan Australia Pty Ltd .

Allergan holds the registered trade mark 'BOTOX' in Australia, which is well-known and widely associated with its anti-wrinkle treatment products.

Self Care sells a range of anti-wrinkle skin care products under the brand name 'Freezeframe'.

Self Care commenced marketing a product called 'PROTOX', which was positioned as an alternative to 'BOTOX'. It employed marketing strategies that emphasised the similarity between 'PROTOX' and 'BOTOX', including the use of phrases like 'Protox – like Botox' and 'instant Botox alternative' in promotional materials.

Allergan commenced proceedings in the Federal Court of Australia alleging Self Care's use of 'PROTOX':

  • infringed upon its 'BOTOX' trade mark
  • created confusion among consumers and diluted the distinctiveness of the 'BOTOX' trade mark.

Initially the Federal Court dismissed Allergan's claims, and Allergan appealed to the Full Federal Court. On appeal, the Full Federal Court ruled against Self Care, finding that the use of 'PROTOX' was deceptively similar to 'BOTOX' and that consumers familiar with 'BOTOX' might have wondered whether 'PROTOX' was an alternative to the 'BOTOX' product.1 Self Care appealed to the High Court of Australia.

Key issues

The High Court considered a number of key issues in this appeal including whether:

  • Self Care's use of the phrase 'instant Botox alternative' was being 'used' as a trade mark
  • the term 'PROTOX' was deceptively similar to the term 'BOTOX'
  • Self Care's use of the phrase 'instant Botox alternative' represents long-term efficacy of the product in contravention of the Australian Consumer Law.2

In defending this appeal, Allergan alleged that its established reputation should be considered in determining whether the term 'PROTOX' was deceptively similar to the term 'BOTOX' for the purposes of trade mark infringement.

The High Court considered the then unsettled question of whether reputation should be a relevant consideration in determining whether a 'mark' is deceptively similar to a registered trade mark for the purposes of trade mark infringement under section 120(1) of the Act.

Decision

Section 120 of the Trade Marks Act 1995 (Cth)

The starting point for trade mark infringement is section 120 of the Act. Section 120 is crucial in protecting the rights of trade mark owners by preventing others from using similar signs that could mislead consumers or dilute the distinctiveness of the registered trade mark.

Put simply, under section 120 trade mark infringement can occur in three ways:

  • Section 120(1): A person infringes a registered trade mark if they use a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services for which the trade mark is registered (i.e. direct infringement).
  • Section 120(2): Infringement can also occur if the sign is used in relation to goods or services of the same description or closely related goods or services, even if not identical (i.e. indirect infringement).
  • Section 120(3): Infringement can also occur if the sign is used in relation to goods or services of the same description or closely related goods or services, even if not identical, in circumstances where consumers would likely assume a trade connection (i.e. use of a sign or mark in advertising).

The decision in Self Care focusses on instances of 'direct infringement' captured by section 120(1) and whether the use of a mark is substantially identical with, or deceptively similar to, a trade mark in relation to goods or services for which that trade mark is registered.

Relevance of reputation

After decades of speculation and confusion, the High Court delivered an explicit statement that a business's reputation should not be taken into account when determining whether trade mark infringement has occurred for the purpose of section 120(1) of the Act.3

The High Court set out a number of reasons of this decision:

  • Registration of a trade mark confers the right to its exclusive use on the registered owner or, in the case of a defensive trade mark, the right to exclude use. If reputation was considered after registration, the level of protection afforded to that right would be uncertain.4
  • Inspection of the trade make register should enable a person or business to assess the likelihood of infringement, without needing to make inquiries about the business history or previous conduct of the registered owner of the trade mark.5
  • Identifying which aspects of reputation and what forms of evidence would be permissible would be a complex exercise.6
  • Introducing reputation as a relevant consideration would be contrary to an objective of the registered trade mark system, which is to provide 'a bright line that delineates the property rights' of a registered owner for the benefit of the owner and the public.7

Accordingly, the High Court decided that: 'the so-called reputation principle in the context of an infringement proceeding under section 120(1), in all its forms, is rejected'.8

Determination

The High Court then moved on to consider whether Self Care's products were deceptively like Allergan's for the purposes of section 120(1) of the Act. Ultimately, the High Court found that there was no 'real, tangible danger' of confusion or deception on Self Care's part.

The High Court found that:

  • the words 'PROTOX' and 'BOTOX' are sufficiently different that a buyer would not confuse the marks or the products9
  • it is common for one company's product to use another company's product to enhance its own without consumers thinking there is an affiliation between the two products10
  • the 'PROTOX' mark was almost always used next to the 'FREEZEFRAME' mark (an umbrella brand of Self Care), indicating that the product was owned by Self Care, not Allergan11
  • there was no real evidence of actual confusion between the two products on the consumers' part.12

Comments

The High Court decision regarding the role of reputation provides much-needed clarity for both trade mark holders and the trade mark registration office. The decision also provides clarity about the evidence required for the purpose of asserting trade mark infringement under section 120(1).

If you would like any further information about intellectual property litigation or reputation management please contact one of the key contacts in our litigation and dispute resolution team.

Footnotes

1Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2021] FCAFC 163.
2Schedule 2 to the Competition and Consumer Act 2011 (Cth)) (ACL)
3Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [3]
4Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [37]
5Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [39]
6Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [48]
7Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [40]
8Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [50]
9Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [69]
10Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [70]
11Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [71]
12Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8, [71]

© Cooper Grace Ward Lawyers

Cooper Grace Ward is a leading Australian law firm based in Brisbane.

This publication is for information only and is not legal advice. You should obtain advice that is specific to your circumstances and not rely on this publication as legal advice. If there are any issues you would like us to advise you on arising from this publication, please contact Cooper Grace Ward Lawyers.

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