Intellectual Property, Information Technology & Software

Like a Boss: Crossfit Inc v Bossfit Pty Ltd [2017] ATMO 74 (24 July 2017)

CrossFit, an entirely too vigorous regime of exercise as far as we are concerned, is an international fitness business with many adherents across the world and in Australia. As the evidence in this matter noted,

“[The Opponent] licences the CrossFit mark to affiliates throughout the world, and there are now approximately 12,836 gyms providing specialised services under the CrossFit mark throughout the world, and 601 of those gyms are based in Australia. There are approximately 116,381 certified CrossFit trainers throughout the world, and 5,869 of those trainers are based in Australia.”

When health club and fitness training services provider Bossfit Pty Ltd (the Applicant) filed a trade mark registration application for the name “BossFit” under Class 41 services, the application was opposed by Crossfit Inc (the Opponent) using the typical “scattergun” grounds for opposition, including ss 42, 44, 58, 60, and 62A ofthe Trade Marks Act 1990. The Opponent provided evidence of a number of its registered “Crossfit” trade marks, all of which are covered under health and fitness-related goods and services.

The interesting aspect of this case is to do with one of the grounds – s44. When assessing the issue of whether the Applicant and the Opponent’s trade marks are substantially identical, the hearing officer noted that the Applicant’s trade mark begins with the word “Boss” while the Opponent’s prefix is the word “Cross.”

The Applicant had a good explanation for the use of the word “BOSS”, as set out in a declaration which intermingled evidence with opinion and legal submissions (we note the rules of evidence do not apply in this forum):

‘BossFit’ as a brand was conceived and launched as an invented word in September 2012 by or on behalf of the Applicant to promote health and fitness, initially to the local Brisbane community.

The BossFit brand was inspired by a love of extreme sports, functional fitness, popular Facebook page Boss Hunting … and popular phrase ‘Like a Boss’, a catchphrase often used in memes that feature a person completing an action with authority and finesse.

The two core design concepts of the BossFit brand are ‘bossness’ and physical fitness. …:

The words ‘Boss’ and ‘Cross’ have completely different natural meanings and convey completely different concepts and the two words ‘Boss’ and ‘CROSS’ are not substantially identical or deceptively similar either visually or orally.

The BossFit Mark and the CROSSFIT Marks contain the same word suffix, namely, the word ‘FIT’. There are hundreds of trade marks registered in class 41 and associated classes with the word suffix ‘FIT’. …

The Applicant believes that the ‘FIT’ word suffix element could not itself be distinctive of the CROSSFIT Marks.

The Applicant believes that the whole words ‘BossFit’ and ‘CROSSFIT’ naturally convey completely different concepts and meanings, that they are phonetically different and that they are not substantially identical or deceptively similar either visually or orally.

The hearing officer accepted this. The comparison then moved onto determining whether there is deceptive similarity.

While discussing the issue of deceptive similarity, the Opponent submitted in a comparison of the two trade marks, the natural and normal pronunciation should be considered, including “the possibility that a word may be slurred” (not just a peculiarity for Australian accents – the concept has a pedigree dating back to the 1925 case of London Lubricants (1920) Ltd’s Appn 42 RPC 264 ). The Opponent submitted that the only difference between the two trade marks are the letters “CR” at the beginning, which have been replaced by the letter “B”—the substantial part of both trade marks is “OSSFIT.”

The Opponent further argued that phonetically, there is a high degree of similarity between the two trade marks and that deception or confusion is highly likely, given the possibility of imperfect recollection, that a person may be caused to wonder whether BossFit’s services has any relation to the Crossfit trade mark.

The Applicant’s counter argument, delivered through a written submission, is that the dominant or essential elements in the trade marks are the word prefixes, CROSS and BOSS, which have completely different natural meanings and convey different concepts and therefore would not lead to deception or confusion.

The Applicant also advanced the argument that the similar element in both trade marks, FIT, could not by itself be distinctive of the trade marks due as evidenced by the hundreds of trade marks registered in class 41 that bear the same word suffix. The hearing officer agreed with the Applicant’s argument. “The respective trade marks are concatenations of two words, the second of which is ‘FIT’. This element lacks distinctiveness in respect of the relevant services. “ The Applicant’s trade mark has been ordered to proceed to registration. This must be correct: te Opponent is not entitled to assert exclusivity over the suffix “FIT” through the back door.

Relying upon suffixes to advance an opposition is always tricky. In Merial v Virbac [2012] ATMO 83 (25 September 2012), in a comparison between “Fiproline” and “Frontline”., while both marks began with the letter “f”, and ended with the suffix “-line”, they were found not to be deceptively similar. On the other hand, in Pfizer Products Inc v Karam(2006) FCA 166, in a comparison between “VIAGRA” and “HERBAGRA”, the court at [38] and [54] agreed with Pfizer’s submissions:

In my opinion, a substantial number of members of the public would identify herbal medicines used to aid health, vitality and sexuality marketed under the name ‘HERBAGRA’ to be a herbal version of VIAGRA, whether or not from the same source, or connected with VIAGRA because of the pervasive reputation of VIAGRA.:

The argument for Pfizer is that the use of the suffix ‘-AGRA’ will cause the requisite confusion as to whether:

• the HERBAGRA product is out of the same stable as VIAGRA;
• the active ingredient in the HERBAGRA product is that in VIAGRA or is from the same family of ingredients;
• the HERBAGRA product is equivalent to VIAGRA in terms of its effects or achieves similar or related effects.

It seems the suffix must be especially notorious to be the proper foundation for such an argument.

This article is general information only, at the date it is posted.  It is not, and should not be relied upon as, legal advice.  This article might not be updated over time and therefore may not reflect changes to the law.  Please feel free to contact us for legal advice that is specific to your situation.

Bye, Innovation Patents (and other news): Australian Productivity Commission – The Federal Government Response

The Australian Federal Government’s response to the controversial Productivity Commission’s Inquiry into Intellectual Property Arrangements was released on Friday.

It deals with the many recommendations made by the Commission. Here are some of the highlights, in so far as they directly affect Australian businesses:

Copyright

• In principle, the government supported the recommendation that restrictions on parallel importations of books be repealed. The government says it “will consult with the book industry to develop a reform pathway that is in the public interest.” This will upset Australian writers and publishers, who fear a flood of cheap imports and an adverse effect upon both the Australian writing industry and Australian culture as embodied in Australian literature.
• The introduction of a fair use exception for copyright went through to the keeper. “This is a complex issue” says the government, and promises to further consult. Fair use has caused a great deal of angst amongst Australian copyright owners. But the American approach is very good. Section 107 of the US Copyright Act sets forth an illustrative list of some types of uses which may qualify as fair use. The list identifies the following: “use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research.” The list is not intended to be exhaustive – Campbell v Acuff-Rose Music Inc 510 US 569, 577 (1994) (noting the “illustrative and not limitative” function of the examples given). In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include:

•  
• The purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes;
• The nature of the copyrighted work
• The amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
• The effect of the use upon the potential market for or value of the copyrighted work.

Section 107 concludes with the following words: “The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.” The fact that the government did not take a pragmatic approach to this and mirror the pragmatic and flexible US legislation is unfortunate.

• Orphan works: “The Government recognises the difficulties both creators and cultural and collecting institutions face in utilising orphan works. It stifles the ability for knowledge to be shared and new content to be created.” It seems that there will be a limitation of liability where diligent searches to locate the author have failed.
• Collecting societies will be the subject of a further review to promote best practice.

Patents

• The government supported the recommendation to put beyond doubt that the assessment of inventive step in Australia is consistent with the European Patent Office.
• There was a slightly chilly response to the idea of lowering patent fees “to promote broader intellectual property policy objectives, rather than the current primary objective of achieving cost recovery.” The government said, “Current Government policy under the Australian Government Charging Framework is that where specific demand for a government activity is created by clearly identifiable individuals or groups, those individuals should be charged for it wherever possible. Granting of IP rights is clearly within this policy statement, and as a regulatory activity is appropriate for cost recovery.”
• Innovation patents are out. “The Commission found that the majority of SMEs who use the innovation patent system do not obtain value from it, and that the system imposes significant costs on third parties and the broader Australian community.” Given the ease by which innovation patents can be obtained and the significant remedies which accrue to innovation patents, this should be regarded as good news, except for those who used innovation patents for a scarecrow effect. Innovation patents are a cause for confusion, and their abolition is a welcome development.
• Changes to the mechanism of extension of pharmaceutical patents, putting more onus onto patent owners, did not gain any real traction.
• Pay for delay agreements between innovators and generic pharmaceutical companies: The government agreed in principle with the recommendation that “The Australian Government should introduce a system for transparent reporting and monitoring of settlements between originator and generic pharmaceutical companies to detect potential pay for delay agreements.”

Trade Marks

• The government supports the recommendation to reduce the grace period from 5 years to 3 years before new registrations can be challenged for non-use. This will compel trade mark owners to use registered marks, and not stockpile them (a bad habit of the wine sector in particular).
• The government does not support the recommendation to remove the presumption of registrability in assessing whether a trade mark could be misleading or confusing.
• Unravelling some very confusing case law (which, with respect, seemed to run counter to the purpose of the legislation), “The Government supports recommendation (c) to ensure that parallel imports of marked goods do not infringe an Australian registered trade mark when the good has been brought to market elsewhere by the owner or licensee. The Government accepts that section 123 of the Trade Marks Act is not effectively implementing the policy intention of allowing for the parallel importation of legitimate goods and has led to some uncertainty and confusion.”
• The government seems to like an idea of an “intention to use” or “use” statement from new applicants.
• “The Government supports recommendation (e) to routinely challenge trade mark applications that contain contemporary geographical references, but some further work is needed to determine the scope of the practice change in the Trade Marks Office. The Government agrees that geographical terms in trade marks are a particularly contentious issue in relation to misleading and confusing connotations.” This is no surprise given the penchant for European GI regulators to challenge Australian businesses on the use of European GIs applied to Australian goods.
• Finally, some 14 years after the long-forgotten Australian Council on Intellectual Property’s report on the issue, “The Government supports in principle recommendation (f) to link the ATMOSS (now known as Australian Trade Mark Search) database with the business registration portal. The Government agrees that additional assistance for business name applicants would be desirable to help them make informed decisions. The Government is currently working to establish a single online portal for streamlined business and company registration and is continuing to develop Australian Trade Mark Search to provide additional capabilities. Linkages between these databases to better assist and streamline business decision-making are being explored.” This might help fix the enormous confusion amongst SMEs in Australia around the difference between business names and trade marks.

Geographical Indicators

• “The Government supports the recommendation that amendments should be made to the process to omit Australian Geographical Indications (GI). The power granted to individuals to effectively veto an omission of a GI is unnecessary and makes the omissions procedure unworkable in practice.” That amendment to the law would remove much of the angst from the process.
• “The Government does not support the recommendation that amendments should be made to the process to amend Australian GIs.”

Plant Breeder’s Rights

• The government supported the recommendation to amend the Plant Breeder’s Rights Act 1994 (Cth) to enable essentially derived variety (EDV) declarations to be made in respect of any variety.

Section 51(3) of the Competition and Consumer Act

• The government agreed to amend this: not so surprising given the ACCC’s perspective on the section as set out in Australian Law Reform Commission Report 122: “The ACCC considers the uncertainty created by s 51(3) of the Competition and Consumer Act 2010 (Cth) which undermines the capacity of competition law to regulate anti-competitive conduct, including unilateral exercise of market power, to be detrimental to the proper operation of copyright licensing.” The government’s response was, “It is now generally agreed that there is no fundamental conflict between IP rights and competition policy; rather they share the purpose of promoting innovation and enhancing consumer welfare. However, where there is evidence of anti-competitive conduct associated with IP licensing arrangements, it is important that such conduct is appropriately regulated. If anti-competitive conduct in this space is nonetheless in the public interest, authorisation will be available under Part VII of the Competition and Consumer Act.”

Open access to Publicly Funded Research

• Guaranteed to upset many university academics, the government agreed for the need for “an open access policy for publicly funded research. The policy should provide free and open access arrangements for all publications funded by governments, directly or through university funding, within 12 months of publication.”

An IP Court

• The government delivered a mixed response to the idea of a dedicated IP court, noting that the Federal Circuit Court is experimenting with such a model, and that patent matters should be determined by judges with experience in the area.

This article is general information only, at the date it is posted.  It is not, and should not be relied upon as, legal advice.  This article might not be updated over time and therefore may not reflect changes to the law.  Please feel free to contact us for legal advice that is specific to your situation.

The Core of the Pink Lady Trade Mark Dispute: High Court of Australia refuses to revisit Apple and Pear Australia Ltd v Pink Lady America LLC [2016] VSCA 280 (23 November 2016)

In April 2017, the High Court of Australia refused special leave to appeal the decision of the Court of Appeal of the Supreme Court of Victoria. This resolved the long running contractual dispute over the “Pink Lady” trade mark. (It effectively ensures that all use of the “Pink Lady” trade marks used in respect of Chilean-grown apples and fruit that are exported from Chile must first be authorised by Apple & Pear Australia Limited (APAL).)

This story begins in 1973 when Western Australian pomologist John Cripps, employed by the Western Australian government’s Department of Agriculture and Food, crossed two apple varietals, called the Golden Delicious and the Lady Williams, in order to create a new variety that exhibits both apples’ best qualities. The outcome was a juice, sweet apple with a greenish yellow base skin. It has been marketed ever since under the Pink Lady brand (but is also referred to as “Cripps Pink”).

APAL is the peak body for Australian commercial apple and pear growers. One of its functions is to commercialise the PINK LADY trade marks in foreign jurisdictions, through a variety of exporters and distributors.

A company called Brandt’s Fruit Trees Inc (BFT), incorporated under the laws of Washington State, is the owner of certain PINK LADY trade mark registrations in the United States and Mexico. BFT has licensed PLA to use and manage BFT’s trade marks.

PLA was formerly part of an organisation called the International Pink Lady Alliance. This body was formed in order to handle global marketing strategies to do with the “Pink Lady” brand. BFT and APAL are part of the International Pink Lady Alliance. It also served as the licensed distributor to a number of different entities in different territories.

In late 2006 to early 2008, PLA filed three applications in Chile to register trade marks relating to PINK LADY. PLA left the International Pink Lady Alliance in 2010. APAL opposed the Chilean trade marks.

In resolution of that dispute, APAL and PLA to enter into an “Option Deed.” Under the Option Deed, PLA would register “Pink Lady” trade marks in Chile and then assign the trade marks to APAL. APAL would then license the trade marks back to PLA on an exclusive, perpetual, and royalty-free basis use in the context of export of PINK LADY-branded apples from Chile to North America. (The licence was subsequently extended to another type of apple called the Rosy Glow variety.) In 2008, the transfer from PLA to APAL of the three pending Chilean PINK LADY trade marks was effected.

In 2008, APAL and PLA also negotiated and entered into a ‘joint export licence’ for the Chilean market. This licence was an effort at consolidation: a device for APAL and PLA to engage with Chilean apple exporters by way of one license: this joint export license replaced multiple licence documents. It was issued from time to time to by the parties to exporters, over a period of three years.

But then the relationship went sour:

PLA alleged that the Option Deed’s terms covered not just the existing trade marks, but also any future logos to be adopted internationally for the “Pink Lady” brand. This included the most recent refresh of the logo, which consisted of a composite mark featuring a flowing pink heart and the “Pink Lady” brand in cursive font.

The lesson from contract lawyers arising from both the first instance decision and the Court of Appeal’s findings comes from this aspect of the licence:

‘…APAL will hereby grant to PLA an exclusive licence to use the Trade Marks with respect to all trade in Products between the Territory (Chile) and North America (The United States, Canada and Mexico). This licence will be royalty free, and will last in perpetuity subject only to the quality control provisions contained therein…’ (Clause 5.1),

Justice Croft said that this manifested the parties’ intention was that, once enlivened, the licence could not be brought to an end, except in that singular event of a quality control failure. (The Victorian Court of Appeal noted at length the Brand Manual, which “also emphasises the need to control brand equity throughout the world”.) Consequently, as a matter of construction, the licence survived termination of the Option Deed. The Court of Appeal said at [222]-[223]:

The IPLA Operating Agreement is a multi-lateral agreement which binds all members of IPLA to give effect to 75 per cent majority decisions about marketing and advertising strategies. It can be accepted that the IPLA Operating Agreement required both PLA and APAL to use the refreshed mark, once this was mandated, and the Brand Manual made this plain. It can be accepted that it was in discharge of this obligation that the refreshed mark was used on the cover of the Joint Export Licence granted by PLA and APAL to approved Chilean exporters in 2010. In particular, once the IPLA members agreed to the future use of the refreshed marks, APAL was obliged as an IPLA member to permit other members to use the refreshed logos in the export trade, including in Chile. Both PLA and APAL, as IPLA members at the time, were simply giving effect to their obligations under the IPLA Operating Agreement…. But this does not mean that the rights and obligations of the IPLA Operating Agreement were to be converted into rights and obligations of the agreement under the Option Deed. Not only is the IPLA Operating Agreement a multi-party agreement and the Option Deed bilateral, but the scope of the rights and obligations are quite distinct.

For trade mark licenses, the outcome of the failure to obtain leave to appeal to the High Court is that the decision of the primary judge, that an trade mark licence can survive termination of the underlying agreement, remains good law. Parties negotiating trade mark licences should think about the life of the licence if the underpinning agreement is terminated, especially where the license contains a perpetual or conditional clause.

• APAL and PLA each ceased issuing the ‘joint export licence’ in respect of exports from Chile.
• On or about 7 December 2012, APAL filed an application to register the Flowing Heart Mark in Chile.
• PLA filed an opposition to APAL’s application in March 2013.
• In May 2013, APAL issued a single export licence from Chile to markets which included Canada and which referred to both the Flowing Heart Mark and the Kangaroo Device Mark.
• In September 2013, PLA also filed its own applications to register a number of trade marks, including the Flowing Heart Mark, in Chile.

This article is general information only, at the date it is posted.  It is not, and should not be relied upon as, legal advice.  This article might not be updated over time and therefore may not reflect changes to the law.  Please feel free to contact us for legal advice that is specific to your situation.

“Made in…?”: Country of Origin Labelling Reforms in Australia

Recent changes to the Australian Country of Origin Food Labelling Information Standard 2016 (“CoOL”) was no doubt influenced by the notorious frozen berry scare in Australia in 2015, which allegedly linked a hepatitis A outbreak to imported frozen berries. This generated public interest in transparency in origin of food labelling. The changes will have a significant effect on businesses that market unpackaged goods, bringing these goods into parity with packaged foods. This means that along with the removal of mandatory minimum font sizes, CoOL information displayed in association with unpackaged food must be legible, prominent, distinctive, and in English. The changes also require signage displayed in association with unpackaged food to be in close proximity to the relevant product.

Additionally, the ACCC has also now provided a guide for businesses that make country of origin claims. The old system only required product labels to state if the product is made from imported and local ingredients. This created a loophole, by which businesses could imply that the products are mostly of Australian origin, even though most of the ingredients are foreign. By way of one extreme example, a can of mushrooms could be labeled as made from local and imported ingredients, even though only the water they are preserved in is sourced from Australia. The mushrooms themselves could be imported from another country.

Under the new Country of Origin Food Labelling Standard, country of origin claims can be made using one of four different categories. More or less in order of the strongest to weakest connection to a country, these are: “Grown in”, “Product of”, “Made in”, and “Packed in”.

However, there are valid concerns coming from producers both small and large scale about the compliance costs of detailed labelling, especially on unpackaged foods. Also of note are producers of products that are affected by seasonality and availability of ingredients, such as butter. The availability of butter in Australia is not consistent, and there are times of the year when producers need to purchase some of their ingredients overseas. The concern is not so much the cost but the impossibility of changing labels and packaging every time they need to source their ingredients from somewhere else.

Another complaint is that highly processed foods and drinks are exempt from the new laws. The Government notes that this exemption was made because research shows that consumers did not necessarily care too much about the country of origin of highly processed food and drinks, such as biscuits, softdrinks, alcohol, snacks, confectionary etc, so they made these “non-priority” products exempt from the laws. (Which seems intuitively remarkable, that a consumer would not care of lemonade was made in China or Australia.)

This article is general information only, at the date it is posted.  It is not, and should not be relied upon as, legal advice.  This article might not be updated over time and therefore may not reflect changes to the law.  Please feel free to contact us for legal advice that is specific to your situation.

The rise of programmers’ colophons – an intuitive moral rights assertion

It seems to be a contemporary trend of website and software developers to include words such as “Powered by…” on the landing page of a website. Many websites go further, and might provide a very detailed list of the website designer, website maintenance team, and even the providers of copyright content such as fonts, photography, video, and animation.

These have become known as “colophons”. A colophon is traditionally associated with antiquarian books, often in an emblematic way as a sort of literary hallmark. Contemporary books contain the same sort of information in a frontis page. The transition of the concept to websites and software is perhaps a surprise. But the idea is to, first, provide a form of signature or promotion of the skills of the developer or development team. Second, it tells users where to find the development team if there’s a problem with the software that needs the development team to fix. Finally, it also serves as a guard against false attribution.

The colophon is sometimes human-readable, appearing on the landing page or elsewhere within the website. But sometimes these are located in the coding of the software or website.

The exercise of the creation of colophons alludes to the purpose of the 2000 introduction of moral rights into the Australian Copyright Act 1968. Under the Copyright Act 1968 an author has three moral rights:

• the right to be identified as the author of their work (the right of attribution);
• the right not to have a person falsely assert or imply that they are the author of a work (the right not to have authorship falsely attributed);
• the right not to have their work subjected to derogatory treatment which is prejudicial to their honour or reputation (the right of integrity of authorship).

The limited Australian case law on moral rights have all focussed on commercialised creative arts – music, artistic drawings, and photographs. There is a school of thought that moral rights have no place in respect of “other” types of works like computer programs and computer-generated works, a way of thinking perhaps inherited from the Copyright Act 1988 (UK) which specifically excludes the application of moral rights from these sorts of works. The reason for that is a practical one. An update to a website should not constitute derogatory treatment of the work.

But the introduction and use of colophons by participants in the software industry indicates that the industry itself takes a different view – that the work that they do is bespoke and worthy of attribution.

Sabacc Strikes Back: Disney’s Latest Star Wars Dispute

US entertainment monolith Disney is once again flexing its legal muscle in order to protect its evergreen Star Wars brand. This time, the dispute is over a concept that was introduced within the story of its Star Wars movies, called “Sabacc”. This obscure Star Wars indicia was first referenced in a draft screenplay for the second film in the franchise, The Empire Strikes Back (1980), and has since appeared in various LucasfFilm properties in various mediums. (Disney is, famously, the owner of LucasFilms, and LucasFilms makes Star Wars movies and licenses the Star Wars brands.)

The defendant in this case is a company called Ren Ventures, which in 2015 started selling a mobile game version of Sabacc and successfully filed a US trademark registration for the term “Sabacc” in 2016. Here is an extract from the US Patent and Trademark Office’s records:

Disney’s complaint is almost certainly linked to a new film entitled Solo: A Star Wars Story on May 2018. It is not known whether the Sabacc game features in the forthcoming motion picture, but the novelisation of The Empire Strikes Back film explains that the Han Solo character’s iconic starship, the Millennium Falcon, was won through a game of Sabacc, so there is a possibility that the card game will be used in the movie’s story.

Ren Ventures’ main argument is that LucasFilm did not trade mark Sabacc, and that all appearances of the term in books and games relied on the Star Wars trade mark to distinguish it. Disney, on the other hand, alleges that Ren Ventures’ mobile game both copies and misappropriates the Sabbac game in order to capitalise on the goodwill established by both the Sabacc brand and the Star Wars franchise. Disney seeks a cancellation of Ren Ventures’ trade mark for Sabacc as well as an injunction restraining Ren Ventures from using the term. Disney also seeks punitive and statutory damages, and a disgorgement of profits and attorney’s fees.

This article is general information only, at the date it is posted.  It is not, and should not be relied upon as, legal advice.  This article might not be updated over time and therefore may not reflect changes to the law.  Please feel free to contact us for legal advice that is specific to your situation.