This series of articles deals with the approach taken by the European Intellectual Property Office (EUIPO) to Banksy's trade marks and draws comparisons with the likely position in Australia. The first article outlined the key issues concerning artworks used as trade marks; the second article examined what "bad faith" means in an Australia context; the third article examined the intention to use as a trade mark under Australian law; and the fourth article discussed ownership and the importance of filing trade mark applications in the name of the legal entity that is the true owner.
This article, the final in our series, examines what the magic words "capable of distinguishing" really mean. These words are important because they establish the threshold level a mark must reach to qualify for registration.
Capable of distinguishing
Trade marks function as badges of origin so purchasers can distinguish one trader's goods/services from those of competitors, even if the identity of trade mark owner is not known. Consumers must therefore be able to identify the products from the trade mark or branding. Sometimes traders will choose non-distinctive trade marks so that they don't need to explain to consumers what the product or services is about. This is best explained by signs that are words, for example, Quick Copy for photocopying services; however, the threshold level applies also to other "signs" such as logos, shapes, colours, smells, sounds, aspects of packaging. A mark such as Quick Copy might achieve a level of market or consumer recognition but not immediately or without some effort by the trade mark owner.
Because Quick Copy cannot immediately indicate a single trade origin it cannot function effectively as a badge of origin. Until this level of recognition is achieved – also called a secondary meaning over and above its "ordinary signification" – it cannot be registered under the Trade Marks Act. The rationale behind requiring marks to be "capable of distinguishing" before they can be registered is to stop traders from securing a monopoly that would prevent other traders from using ordinary signs to describe their similar goods/services.
The situation is different for a stylised version, such as this:
This mark conveys the same meaning as the plain word Quick Copy but does not give the owner a statutory monopoly that deprives other traders of the right to use the words "quick copy".
The threshold test ("capable of distinguishing") provides a lens through which to look at and assess "signs" for which registration is sought. The overriding principle in Anglo-Australian law for more than a century has been and remains that no trader should be allowed to obtain registration for "signs" that other traders who are acting without improper motive have legitimate right to use.
What lies at the heart of the inquiry in each case is the nature of the sign itself, that is, whether and to what extent a sign can act as a badge of origin. This is called its inherent adaption to distinguish. Generally, a sign will lack inherent adaptation to distinguish if it is the type of sign that other traders have a legitimate expectation to be able to use for the same or similar goods/services. Signs that are inherently non-distinctive are: words that have a direct reference to some characteristic of the goods/services; words that are laudatory, geographical names or are surnames; shapes that are functional; single colours or the natural colour of goods; the natural smell of the goods. There is a huge body of case law dealing with various instances of these categories. The largest number of cases deal with what amounts to a direct reference as opposed to an indirect or allusive reference. The assessment is always conducted with respect to the particular goods/services. For this reason BLACK LACE is immediately registrable for cosmetics but not for lace or clothing.
If a trade mark does not immediately qualify for registration as inherently "capable of distinguishing", evidence of reputation arising from use might establish that it has met the standard. This is called "acquired distinctiveness". The level of inherent distinctiveness of a sign will determine how extensive the use/reputation must be and at what time it must have achieved the threshold level. A word mark such as BEAUTIFUL, which is descriptive and laudatory, was only registered for perfume after proof of extensive use and showing that no other trader had used it as a trade mark.
Artistic works such as Banksy's
Assessing signs that are artistic works, such as Banksy's, involves the same determination: is the sign "capable of distinguishing" – but judged according to different considerations. Amongst these are the level of creativity, the subject of the artistic work, etc.. A simple representation of the goods, such as a line drawing of a bottle, even if original and aesthetically appealing, might not be recognisable/distinctive for consumers in relation to wine. On the other hand, the Mona Lisa clearly has no connection with pasta or photographic apparatus and so will not raise the same distinctiveness issues. With artworks there can be the added complication that reproduction might be illegal because copyright subsists in them for the life of the author plus 70 years.
Distinctiveness: the EUIPO's position vs Australia
While Full Colour Black had alleged that Banksy's marks were not capable of distinguishing the EUIPO was not required to consider distinctiveness once it had concluded that Banksy's applications were made in bad faith.
In Australia, Full Colour Black is again contending that Banksy's marks are not capable of distinguishing because they have been used in other parts of the world for various goods without action being taken against them for copyright infringement. It is difficult however to see how Full Colour Black can establish that the artworks are not inherently distinctive in Australia for this reason, especially when the public have come to associate the artworks with Banksy, who has authorised Pest Control Office to apply to register them as trade marks. Even if the position outside Australia is possibly relevant, it is uncertain to what extent this is known in Australia. It is unlikely to be so extensively known as to vitiate the ability of the artworks to function as effective badges of origin. It is important to recall that Pest Control Office enjoys the presumption that the trade marks it has applied for are registrable.
Key takeaways for trade mark owners
Devising a distinctive trade mark is the best way to mitigate against costly legal disputes both in securing quick registration and defending the registration against any future attempts at cancellation as being non-distinctive. A mark that is an invented word, such as KODAK, with no other associations will be easier to defend than Quick Copy or Kwik Kopy even if extensively used as no one can have a legitimate claim to use Kodak. It can be difficult and very costly to argue when a trade mark registration is challenged in infringement proceedings that it contains only a skilful and covert allusion and not a direct reference when used for the relevant goods/services.
Artworks such as Banksy's raise somewhat different considerations. Registration will always depend on determining whether as "signs" they are capable of distinguishing; however, care needs to be taken not to use or permit the use of the signs (artworks) in ways that undermine their ability to function as badges of origin, that is, to indicate a unique trade source. If the artworks are perceived as having multiple commercial origins for goods to which they are applied, then they might lose the distinctiveness which is essential to a trade mark. Once this happens, a sign that might have been inherently distinctive might become ambiguous and so non-distinctive.
Please contact Clayton Utz if you would like any assistance or advice regarding the brand protection strategy of your business or if you are concerned that another trader is infringing your trade mark rights, whether registered or unregistered.