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Monitor the use of your trade marks or risk deregistration

Intellectual Property Law News | July 2016

Two trade mark registrations have been removed after the Full Federal Court’s recent decision in Lodestar Anstalt v Campari America LLC [2016] FCAFC 92 to grant an application for the removal of the trade marks under Part 9 of the Trade Marks Act 1995 (Cth) [“Act”].

The question before the Court in this case was whether the “authorised use” provisions contained in section 8 of the Act, in particular “under the control of” and “connection in the course of trade”, could be satisfied by a licence agreement.

Section 8(1) of the Act defines an “authorised user” of a trade mark as someone who uses the trade mark in relation to goods or services under the control of the owner of the trade mark”. Under section 8(3) of the Act, a trade mark is taken to be under the control of the owner if the owner exercises quality control over goods or services in relation to which the trade mark is used.

The Court found that a licence agreement authorising use of a trade mark was not sufficient as an “authorised use” to show that the licensee was an authorised user of the trade marks within the meaning of section 8 of the Act. The Court also found that in order for a licensee to be an “authorised user”, the registered owner must exercise actual control over the licensee’s use of the trade mark. This means that the registered owner must always maintain a connection with the trade mark in order for it to remain registered.

This case holds significant implications for trade mark owners who do not actively use their trade marks and who licence them to other trading entities. To avoid deregistration of trade marks for non-use, ensure that the following actions are taken:

  1. Ensure that you have clearly drafted licence agreements in place, which contain mechanisms to enable the registered owner to exercise control over the licensee’s use of the trade mark.
  2. Once the licence agreement is in place, make sure that the registered owner exercises control over the trade mark at least once every 3 years.
  3. The registered owner or authorised user is using the trade mark in the course of trade in Australia.
  4. Arrange for the licensee or other authorised user to have their interest in the trade mark registered with IP Australia.
If you wish to discuss any matters relating to trade marks or licensing agreements please contact us at Forum Law Solicitors for a free 30 minute discussion on (02) 9560 3388 or in our friendly and professional office in Leichhardt where parking for clients is free.

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