Reputation in Trade Mark Infringement : Why Some Courts Think it Matters and Why it Should Not

Australian case law on infringement of registered trade marks has placed an increasing emphasis on the reputation of the owner of the registered trade mark in determining whether infringement has occurred. Consideration of the trade mark owner's reputation has been included in determining whether the sign used by the defendant is deceptively similar to the registered trade mark and, more recently, in determining whether the defendant has used its allegedly infringing sign 'as a trade mark'. Neither development is consistent with either the law relating to registered trade marks or the underlying policy reasons for the system of registration. This article discusses the case law which has introduced the tendency of the courts to consider the reputation associated with an owner of a registered trade mark in determining infringement proceedings, the reasons why such an approach is not consistent with the legislation nor with the rationale underlying our registered trade mark system. In particular, one of the objectives of the registered trade mark system is to provide a bright line that delineates the property rights of the registered owner. The bright line is publicly available information as to who has the rights in a trade mark and what those rights are. These rights are defined by reference to the act of registration, not by reference to the rights to protection of the reputation of the registered owner conferred by a passing off action which are independent of the rights flowing from registration. Consequently, if the rights conferred by registration are diminished or enhanced by reference to the trade mark owner's reputation, the exercise of delineating the rights of the owner in advance would be rendered nugatory to the extent that they are so diminished or enhanced. For that reason alone considerable caution should be exercised before introducing evidence of a trade mark owner's reputation in the process of determining whether its trade mark has been infringed