Thinking | 9 September 2020

Making Your Mark – a guide for SMEs and advisors: the value of a registered trade mark

By Ben Hamilton and Alicia Bray

In our new ‘Making Your Mark’ trade mark series, we look at some of the key issues for trade mark owners and advisors operating in and entering the Australian market.

To kick things off, we focus on the two types of trade marks recognised under Australian law, registered and common law (unregistered) trade marks, and some of the benefits associated with a trade mark registration.

As the name suggests, registered trade marks appear on a public register after going through a formal application process, resulting in the owner being issued with a certificate of registration. On the grant of registration, the trade mark becomes a distinct property right of the owner.

On the other hand, common law (or unregistered) rights may exist if a trade mark has been used to the extent that it has gained a significant reputation in relation to specific goods and services, such that consumers associate the mark with those goods and services. Legally, a common law trade mark is part of, and not severable from, the overall goodwill of a business.

Many businesses choose to rely on common law rights; however, for a relatively low cost, the value of a trade mark registration cannot be overstated. Some of the main advantages for owners include:

  • it can block future applications for registration of substantially identical or deceptively similar trade marks in relation to similar or closely related goods and services;
  • as a property right, it provides the owner with the exclusive right to use, authorise the use of, commercialise and sell the trade mark in connection with specific goods and services, noting that the recent decision in Bega v Kraft[1] highlights the complexities surrounding the exploitation of common law rights;
  • it serves as a warning to other traders not to use a similar trade mark in relation to related goods and services; and
  • it provides the owner with stronger enforcement rights, as:
    • action can be taken in relation to potentially infringing trade marks which are not only substantially identical, but deceptively similar, in relation to goods and services which are of the same description or closely related; and
    • the owner is not required to establish that it has acquired a sufficient reputation in relation to the goods and services, as is the case with common law marks.

In our experience, trade mark disputes are generally more common where a party has not obtained a trade mark registration from the outset. In these circumstances, owners of common law (unregistered) marks are often on the back foot, with the options available to them being limited to actions for passing off and/or misleading and deceptive conduct, which are generally much more difficult to establish than infringement actions based on registered marks.

Whether your business has one trade mark or a portfolio of different marks, consideration should be given to whether adequate protection is in place.

[1] Kraft Foods Group Brands LLC v Bega Cheese Limited [2020] FCAFC 65

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