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Wednesday, December 4, 2013

Fast threads and fine cars

By Kimberley Evans, Trade Mark Attorney

Car lovers know that BUGATTI is a trade mark that is all about cars.

But since at least 1989, apparently it has also been about clothing.

Earlier this year, Bugatti GmbH (Bugatti) brought trade mark infringement proceedings against Shine Forever Men Pty Ltd (Shine Forever) for its sale of men's clothing marked with the BUGATCHI UOMO trade mark in Australia since 2010. The BUGATCHI UOMO goods sold by Shine Forever were manufactured by Bugatchi Uomo Apparel Inc. (BUA) in Canada and imported into Australia by Shine Forever for distribution. BUA is the applicant for the BUGATCHI UOMO trade mark in Australia* and has used the BUGATCHI UOMO trade mark in at least Canada since 1976.

Bugatti claimed that the BUGATCHI UOMO trade mark was deceptively similar to the BUGATTI trade mark, which Bugatti had registered (and used) in Australia in respect of Class 25 as early as 1989. Justice Tracey agreed with Bugatti that the marks were deceptively similar and that the BUGATTI registrations had been infringed.  Nothing about this assessment raised any eyebrows here in the IP team, particularly given that Bugatti adduced evidence of actual instances of confusion between the two marks.

Gratuitous Background pic of a shiny Bugatti Veyron**

What did get our engines going was Shine Forever's choice to send a 'director' of Shine Forever (without any legal knowledge) to argue the matter at trial*** and the argument that, following Estex Clothing, BUA was the user of the BUGATCHI UOMO trade mark in Australia, not Shine Forever. Estex states that an overseas manufacturer selling products in Australia by way of a local retailer remains the user of that trade mark as long as the goods are in the course of trade and the trade mark is acting as an indication of origin.

Justice Tracey disagreed, saying that Pioneer**** and Lion Nathan had clarified that use of a trade mark does not rest only with the overseas manufacturer. An importer and subsequent distributor/retailer in Australia may also be found to have used the trade mark for the purposes of section 120 of the Trade Marks Act 1995. This construction was supported by the Full Court's recent decision in Paul's Retail. By importing and distributing the BUGATCHI UOMO goods, Shine Forever had used the BUGATCHI UOMO trade mark and therefore infringed the BUGATTI registrations.

Justice Tracey also dismissed Shine Forever's argument that use of the BUGATCHI UOMO trade mark was defensible under sub-sections 122(1)(f) and (fa) as BUA, the user of the trade mark in Australia rather than Shine Forever, would be entitled to registration of the mark. (These sub-sections provide a defence to infringement where the court is of the opinion that a person found to have infringed a trade mark would obtain registration of the infringing sign were he or she to apply for it.) His Honour indicated that the major difficulty with this defence was that BUA was not joined to the proceedings and the wording of sections 122(1)(f) and (fa) plainly refer to the 'person' against whom the infringement is alleged, namely Shine Forever. As Shine Forever steadfastly denied using the BUGATCHI UOMO trade mark and claimed that BUA was the sole user of the trade mark in Australia, this defence did not assist Shine Forever.

This case highlights the importance of having appropriate legal representation when facing allegations of trade mark infringement and confirms that Australian distributors will not escape liability for trade mark infringement merely because the goods distributed originate from an overseas entity.

* Application No. 1373275 (IR 974226) BUGATCHI UOMO, which has been opposed by Bugatti
** used under Creative Commons licence
*** The pleadings had been prepared by a solicitor
**** Pioneer Kabushiki Kaisha v Registrar of Trade Marks (1977) 137 CLR 670 per Aickin J

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