In brief 2 min read
Two recent examples of Australian businesses clashing with multinational businesses in relation to trade marks serve as cautionary tales for all businesses. Associate Nick Li reports.
Style on the surface
Stylkea, Kylie Hughes' humble Gold Coast business selling adhesive decorative panels for furniture (especially IKEA furniture), received media acclaim in 2017 for its affordable and innovative products breathing designer chic into otherwise plain furniture.
When Ms Hughes applied to register the word 'Stylkea' as a trade mark in September 2017, having already obtained business name and domain name registrations, IKEA opposed, setting the stage for a David and Goliath battle. Ultimately, the Swedish giant proved too much for Ms Hughes, who has agreed to rebrand her business.
Why did IKEA oppose?
IKEA alleged that 'Stylkea' infringed the 'IKEA' trade marks and amounted to misleading or deceptive conduct. If 'Stylkea' was registered, use of it as a trade mark in relation to the goods the subject of the registration would have been a defence to trade mark infringement, but not to the claim of misleading or deceptive conduct.
It is likely IKEA's opposition to Ms Hughes' trade mark application was on the basis that the trade mark 'Stylkea' was deceptively similar to the registered trade marks for 'IKEA', or that use of the trade mark was likely to deceive or cause confusion given the reputation in the IKEA trade marks (sections 44 and 60 of the Trade Marks Act 1995 (Cth), respectively).
In our view, the odds were in IKEA's favour, given the visual and aural similarity between 'Stylkea' and 'IKEA', and that the trade marks were likely to appear in relation to similar goods. A consumer seeing both marks would likely have had cause to wonder whether the goods originated from the same source.
Things get UGGly for Aussie business
Ms Hughes' story is not the only noteworthy trade mark battle between an Australian business and a global brand in the spotlight at the moment.
In 2016, we reported that the fashion giant Deckers had commenced trade mark infringement proceedings in the US against Australian Leather Pty Ltd in relation to the word 'UGG'. Last year, the Illinois District Court dismissed Australian Leather's application for summary judgement, holding that the word 'UGG', in the US at least, was not a generic term to describe the iconic Australian sheepskin boots. In a further blow to Australian Leather, last month a jury found that by making sales over the internet of boots labelled 'Ugg boots', Australian Leather had infringed Decker's trade marks containing the word 'UGG'.
Cautionary Tales?
These stories are cautionary tales for all businesses. Importantly:
- a trade mark does not have to be identical to a registered trade mark for it to infringe that trade mark;
- domain name and business name registrations do NOT provide trade mark protection, and are NOT a defence to trade mark infringement; and
- words that may be generic in Australia can be distinctive, and may be registrable as a trade mark, in another country.
While we eagerly await Ms Hughes' rebranded business, please take a moment to consider not only whether your business has sufficient IP protection, but also whether it may be at risk of infringing the IP of a third party.