23 May 2006
Sydney, 23 May 2006: Businesses that want to secure the exclusive right to use a particular colour in association with their products are likely to face an uphill battle unless they can show that their competitors have deliberately attempted to trade on their reputation by using the same or a similar hue, according to a leading IP lawyer.
Clayton Utz IP partner Wayne Condon says a recent Federal Court decision in favour of Darrell Lea and its right to use the colour 'purple' for its chocolate wrappings despite objections from Cadbury highlights the difficulty for traders in establishing that they have a distinctive reputation in a particular colour to the exclusion of other traders.
Mr Condon says although the decision does not spell the end for colour trademarks in Australia, it has raised the bar for future legal disputes involving "non-traditional" marks, including trade marks for sounds and shapes. "The mere fact that Cadbury may get a trade mark registration for the colour purple does not automatically mean that it can prevent other traders from using that colour for chocolate. For a trade mark infringement to be made out the alleged infringer must use the relevant mark or a similar mark as a trade mark. That can be difficult to establish in the case of a non traditional mark," says Mr Condon.
"Perhaps we haven't heard the last word yet, but the Cadbury case certainly does not assist companies who would seek to monopolise colour as part of their trading reputation."
Cadbury argued before the Federal Court that it had a distinctive reputation in relation to its use of the colour purple to package its chocolate products and that Darrell Lea's use of a similar colour was likely to mislead or deceive consumers into thinking Darrell Lea's products were associated with Cadbury's.
Cadbury has used the purple wrapping for its Dairy Milk products since the 1920s. However, it was only in the mid-1990s that Cadbury began branding its entire product range in purple wrapping.
In dismissing Cadbury's case, Justice Heerey found that many traders had used a similar shade of purple in respect of their chocolate products and that Cadbury had never used the colour in isolation as a "badge of origin" - something which tells the consumer that the goods being sold under the trademark come from a single trade source. His Honour also found that Darrell Lea's own name was distinctive and used consistently in its own marketing, and that the company had not shown an intention to mislead or deceive consumers into thinking it had an association with Cadbury.
Mr Condon says the decision demonstrates that a company's long-term use of a particular colour is not enough to establish exclusive rights. "What needs to be established is that the colour (or the sound or shape) is used on its own as signifying the trader and no-one else - that is, the sign is used as an exclusive badge of origin. It is not enough if the sign is used in conjunction with words or a logo because in those circumstances it is the latter which will have trade mark significance."
Since it became possible in Australia in the mid-1990s to trade mark colours, shapes and sounds, there have been a number of disputes between businesses over their rights to such marks. Philips, for example, unsuccessfully took action against Remington in relation to the latter's use of the triple-headed rotary shaver head, while BP is continuing its fight to claim monopoly rights in the colour green.
Mr Condon says Australia is likely to see further litigation arising from shape, colour and sound trademarks. "These cases will always turn on their particular facts. The fundamental rule which applies is that sign relied on must stand alone as the "badge" of the company's reputation. If you can satisfy that hurdle, you might stand a chance."
