Trade mark ownership: Why is it so important?

Protecting a business’ brand should be in the forefront of every business owner’s mind. One important step in gaining this protection is through applying for a registered trade mark for a business name or logo.


KEY TAKE OUTS:

  • Protecting a business’ brand is a priority.
  • Applying for a registered trade mark for a business name or logo will help to protect your brand by enforcing trade mark ownership against other people or businesses that are using the trade mark.
  • A trade mark owner must actively use their trade mark in the course of trade.

As a brand grows and is more recognised within an industry, the value of a trade mark grows, hence why a business’ intellectual property (such as a registered trade mark) can be such a valuable asset.

It is critical to consider when applying for a new trade mark whether the correct entity or individual has ownership of the trade mark.

s 27(1) of the Trade Marks Act 1995 (Cth)

Under s 27(1) of the Trade Marks Act 1995 (Cth) (Trade Marks Act), a person (including a company) is only allowed to apply for registration of a trade mark if that person claims to be the owner of the trade mark and if one of the following apply:

(a)   the person is using or intends to use the trade mark;

(b)   the person has authorised or intends to authorise another person to use the trade mark (for example through an intellectual property licence agreement);

(c)    the person intends to assign the trade mark to a body corporate that is about to be constituted (for example, a new company that you are setting up that will eventually own the trade mark).

The effect of this clause is that you should not apply for a trade mark if you are not the owner of the trade mark and will not be using it within the market or do not intend on assigning the right to use it to another person.

An example of the incorrect owner of a trade mark being listed as the owner, would be if someone applied for a trade mark in their individual name, when in actual fact their company is the entity that owns their business and will actually use the trade mark, not themselves as an individual. Failure to accurately identify the owner of a trade mark may make the trade mark application invalid.

Why does ownership matter?

Other than the example noted above, there are a number of other reasons why the correct ownership of a trade mark should be considered in the early stages of the application process.

(a)   Ability to enforce your trade marks rights:

Often one of the key reasons a person will apply for a registered trade mark is to have the ability to enforce trade mark ownership against other people or businesses that are using the trade mark.

If, using the example above, an individual (who is the director of their company) is the registered owner of a trade mark, their company will not be able to enforce the registered trade mark in court (the registered owner would have to in their individual capacity). This would obviously have a financial impact in that the individual would have to bear the costs and risks associated in enforcing a trade mark in their individual capacity.

(b)   Proving use of your trade mark:

A trade mark owner must actively use their trade mark in the course of trade. If they don’t, someone can make a claim to have their trade mark removed/unregistered for non-use.

If, again using the example above, a trade mark is registered under an individual’s name when in actual fact their company is the entity that uses the trade mark, the trade mark may be removed or unregistered as the individual who owns the trade mark has not used the trade mark in the market. This is regardless of whether or not the company has used the trade mark due to the fact that a company is a separate legal entity and is not the registered owner.

(c)   Case example – Wild Geese v Wild Turkey (Lodestar Anstalt v Campari America LLC [2016] FCAFC 92)

This case deals with a dispute spanning over 15 years between Lodestar, who produces and sells Wild Geese Rare Irish Whiskey (Wild Geese) and Campari, who produces and sells Wild Turkey Bourbon (Wild Turkey).

Wild Turkey owns the registered trade mark “Wild Turkey”.

In 2000, Wild Geese applied for registration of the trade mark “Wild Geese”.

During this time, Wild Geese Wines Pty Ltd (Wild Geese Wines) began operating in South Australia under the name Wild Geese Wines. Wanting to register “Wild Geese” as a trade mark, Wild Geese Wines applied to remove Wild Geese’s already registered trade mark for non-use as they believed Wild Geese whiskey had not been sold in Australia.

At the same time, Wild Turkey also applied to remove Wild Geese’s trade mark. Wild Turkey and Wild Geese Wines came to an arrangement whereby Wild Geese Wines would transfer all of their registered trade marks in to the name of Wild Turkey (as well as the application to remove Wild Geese’s trade mark) and Wild Turkey would licence the right to use the “Wild Geese” trade mark to Wild Geese Wines.

Nearly 8 years later, Wild Geese applied for removal of the “Wild Geese” trade mark (owned by Wild Turkey and licensed to Wild Geese Wines) for non-use. Wild Turkey had not used the trade mark but had licensed the right to use the trade mark to Wild Geese Wines under a licence agreement.

Wild Geese claimed that, although Wild Geese Wines had used the trade mark and there was a formal licence agreement in place, Wild Turkey had not exercised enough control over the use of the trade mark as required under the Trade Marks Act for this to be considered “use” of the trade mark.

Wild Turkey’s trade mark was subsequently removed from the trade marks register for non-use and Wild Geese is now the current owner of the trade mark “Wild Geese”.

This case is a key example of the importance that businesses are cautious when it comes to trade mark ownership and entering into licence agreements.

At Coutts Lawyers & Conveyaners, we have extensive experience in trade mark applications, intellectual property identification and management, intellectual property licence agreements and can assist in identifying who should be the registered owner of your valuable intellectual property.


For further information please don’t hesitate to contact:

info@couttslegal.com.au
1300 268 887

Contact Coutts today.

This news is merely general and non specific information on the subject matter and is not and should not be considered or relied on as legal advice. Coutts is not responsible for any cost, expense, loss or liability whatsoever in relation to this information, including all or any reliance on this as a blog or use or application of this blog by you.