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30 Sep 11
Is your trade mark registration at risk?

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The importance of correctly documenting the assignment or use of a trade mark by an entity other than the registered owner has been highlighted in a recent Australian trade mark opposition decision. Failure to document the assignment or authorised use of a trade mark can ultimately result in removal of the trade mark for non-use.

The decision

SG Fleet Salary Packaging Pty Ltd’s (SG Fleet) trade mark for FINLEASE (claiming financial affairs in class 36) was ordered to be removed from the Trade Mark Register for ‘non-use’ following an application for removal by Finlease (Australia) Pty Ltd (Finlease). The non-use application claimed that SG Fleet had not used, or authorised another entity to use the FINLEASE trade mark in Australia in the requisite three year period.

Use of the trade mark

Based on the evidence provided, to defeat the non-use application SG Fleet needed to establish that there had been use of the FINLEASE trade mark by SG Fleet as registered owner, or ‘authorised use’ of the trade mark by its alleged parent company, SG Fleet Australia Pty Ltd.

The decision considered an asset sale agreement between SG Fleet and its alleged parent company in which SG Fleet agreed to transfer ‘Business Assets’ to the parent company. While a number of sections in the agreement were blacked out, the agreement provided for the Business Assets to expressly include the ‘Intellectual Property’ of SG Fleet, but not the ‘Excluded Assets’. However no definition of ‘Intellectual Property’ or ‘Excluded Assets’ was provided, and the agreement made no specific reference to the FINLEASE trade mark. The Hearings Officer was not satisfied that the agreement was sufficient to show the FINLEASE trade mark had been acquired by the parent company.

SG Fleet also failed to provide any evidence showing a licensing agreement for the parent company’s use of the FINLEASE trade mark, or that relevant controls were in place from SG Fleet to the parent company regarding the use of the trade mark.

In considering the above, the Hearings Officer found that there was no relevant use of the trade mark during the requisite three year period by SG Fleet or an ‘authorised user’ and ordered the trade mark be removed from the Trade Mark Register for non-use.

Other issues

In attempting to prove use of the trade mark, SG Fleet’s submission consisted of three website print outs showing use of the FINLEASE trade mark, all dated after the specified three year period of non-use. This strengthened the Finlease’s case that there had been no relevant use during that period.

It was also found that SG Fleet was not in fact wholly owned by the user of the trade mark, SG Fleet Australia Pty Ltd, as claimed.

Lessons learned

Trade mark owners should be careful when transferring ownership, or authorising use of their registered trade marks to an entity other than the registered owner.

Ideally all third party dealings regarding trade marks should be formally documented (including between a parent company/trading company/holding company) and registered with IP Australia where applicable. Failing to understand the chain of title for trade marks, or correctly documenting authorised use or the assignment of trade marks from one entity to another, may result in removal of the trade marks from the Register.

This decision emphasises the importance of seeking advice on how to document dealings regarding registered trade marks. Seeking advice early and putting in place the required documents can reduce the risk of third party oppositions or objections being successful during the life of the trade mark registration.

 

Focus covers legal and technical issues in a general way. It is not designed to express opinions on specific cases. Focus is intended for information purposes only and should not be regarded as legal advice. Further advice should be obtained before taking action on any issue dealt with in this publication.

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