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Monday, June 22, 2015

Wild Turkey victorious in its quest to dominate the (alcoholic) wild bird world

By Nadia Guadagno, Senior Associate

The owners of Wild Turkey Bourbon* and Wild Geese Rare Irish Whisky (Lodestar) have been engaged in a 15-year worldwide battle regarding their respective rights to use the WILD GEESE mark. The owners of Wild Turkey have vigorously opposed use by the makers of Wild Geese Rare Irish Whiskey of the words ‘Wild Geese’. The underlying motivation? Apparently not everyone might distinguish a wild goose from a wild turkey.

The Federal Court recently considered an application to have Wild Turkey's WILD GEESE trade marks removed from the register on the basis of non-use. I hear you ask: How did Wild Turkey come to be the registered owner of WILD GEESE trade marks? A quick look at the history between the parties in Australia will reveal.


The story so far…

 
  • In 2000, Lodestar registers WILD GEESE as a trade mark.
  • At about the same time Mr O'Sullivan, a South Australian barrister, starts selling wine under the name 'Wild Geese Wines'. Little did he know then that his choice of name would lead him to become embroiled in this hostile dispute…
  • In 2005, Mr O’Sullivan applies to register the trade marks WILD GEESE and WILD GEESE WINES through his company Wild Geese Wines Pty Ltd, but finds out Lodestar had got in first.  
  • Mr O'Sullivan then has a bright idea – as Lodestar (at the time) had never sold any of its whiskey or used its WILD GEESE trade mark in Australia, he made an application to have Lodestar's mark removed on the basis of non-use (which, if successful, would clear the way for his trade mark applications).
  • Mr O'Sullivan discovers that Wild Turkey had already made the same removal application. He writes to Wild Turkey, which in turn accuses Mr O'Sullivan's company of infringing the WILD TURKEY trade marks by selling its wines under the name WILD GEESE WINES.
  • Deciding he had no appetite to be entangled in the battle between the wild birds, in 2007 he enters into an agreement with Wild Turkey in which he assigns his interests in the WILD GEESE and WILD GEESE WINES trade marks to Wild Turkey, who in turn, agrees to license those same marks back to Wild Geese Wines in perpetuity for a one-off fee of $1. 
  • After much litigation, Wild Turkey succeeds in having WILD GEESE removed from the register and, in 2009, Wild Turkey secures registration of its own WILD GEESE and WILD GEESE WINES trade marks (ie the marks assigned by Mr O'Sullivan).
  • Lodestar, who since 2007 has been selling its Wild Geese Rare Irish Whisky in Australia, is now fighting back to have Wild Turkey's WILD GEESE and WILD GEESE WINES trade marks removed from the register on the basis of non-use.


Application to remove a mark for non-use


A trade mark can be removed from the register if it has not been used in Australia for three years in relation to the goods or services in respect of which the mark is registered. 'Use' includes 'authorised use' which occurs where the trade mark is used under the control of the owner of the trade mark. A person is deemed to use a mark under the control of the trade mark owner if the trade mark owner exercises quality control over the relevant goods or services.


Had Wild Turkey used 'Wild Geese'?


During the relevant three-year period, Wild Turkey had sold Wild Turkey Bourbon in Australia but it had not sold anything under the name WILD GEESE. The only person using WILD GEESE in relation to alcoholic beverages was Wild Geese Wines. Wild Geese Wines had made some modest sales of bottles of Merlot labelled with WILD GEESE WINES, which the court found were sufficient to constitute 'use' of the trade marks during the three-year period.


Was Mr O'Sullivan's use of the trade marks 'authorised use'?


The answer to this question depends on whether Wild Geese Wines used the trade marks under the control of Wild Turkey. Wild Turkey points to the licence agreement to support answering that question in the affirmative.
The licence agreement incorporates some quality control provisions including:
  1. that the wine must be of sufficient quality to obtain continuing export approval from the Australian Wine and Brandy Corporation (the AWBC);
  2. if requested by Wild Turkey, Wild Geese Wines must provide Wild Turkey with three bottles of the wine in any 12-month period;
  3. if requested by Wild Turkey, Wild Geese Wines must provide another four bottles to the Australian Wine Research Institute for testing and submission of the wine to the AWBC; and
  4. if the AWBC did not give its continuing approval, the wine was to be withdrawn and not marketed under the marks.
What happened in reality? During the non-use period, Wild Turkey did not seek to rely on any of these provisions. It never marketed nor distributed Wild Geese wines and the only revenue it had received in relation to those wines was the initial $1. Mr O'Sullivan gave evidence that while he was aware of his obligations under the licence, they did not have any impact on how he made his wine at a technical level. The court found it was significant that the quality control provision (see point 1 above) emanated from Mr O'Sullivan, who was concerned that he not be at the mercy of the licensor's opinion as to whether his wine was of acceptable quality.

Based on this, the court concluded that Wild Turkey excised no actual control over the way Wild Geese Wines used the trade marks and no quality control over the wine. The court found that the licence agreement was not intended by the parties to deliver anything but the appearance of control to Wild Turkey and that there was no evidence at all that Wild Turkey was in the least interested in what Mr O’Sullivan was bottling or in any way supervising what was being done under the marks. As such, Wild Turkey's ability to control the quality of the wine was entirely theoretical and had no footing in reality.

If it was up to the presiding judge, he would have found that 'control' requires actual control in fact and is not satisfied by mere possibility of legal control. However, his hands were tied by an earlier Full Federal Court decision and on the basis of that decision, he reluctantly held that a mere theoretical possibility of contractual control is sufficient to constitute authorised use.

Wild Turkey had 'theoretical control in the sense that [it] could prevent [Wild Geese Wines] using the trade marks on truly undrinkable wine.' As such, the court had no power to remove Wild Turkey's WILD GEESE and WILD GEESE WINES marks from the register.

Clearly this sets a fairly low hurdle to jump in relation to showing there has been 'authorised use'. It is likely, as here, that a simple licensing arrangement would suffice, even if it had not been enforced.
However, the battle between the wild birds does not end here: Lodestar has launched an appeal against the decision. Lodestar has also applied to register WILD GEESE RARE IRISH WHISKEY as a trade mark and unsurprisingly, it has been opposed by Wild Turkey.

* As the Wild Turkey trade mark has been owned by several different corporate groups over the years, for simplicity, this article will refer to the owners as 'Wild Turkey'.

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