What you need to know
- The Federal Court of Australia has found that the words URBAN ALE are not registrable for beer because they are a descriptive term for beer products that are produced in an inner city location.
- This is the second decision in recent years where the Federal Court has found that a beer producer cannot exclusively use certain words for beer products where the words have a descriptive aspect. In the earlier case the words PACIFIC ALE were found to have descriptive quality even though they did not describe a recognised beer-style.
What you need to do
- When deciding on a brand for a product, consider whether the options you are considering have any descriptive quality in relation to the product or have otherwise become associated with the product in some way.
The parties and allegations
The applicant, Urban Alley, operates a craft brewery in Melbourne, Australia. It sells a beer product under the mark URBAN ALE and owns a trade mark registration for that mark in class 32 for beer. The respondent, La Siréne, also operates a craft brewery in Melbourne, Australia. It produces and sells craft beer under the name LA SIRÉNE including a product called FARMHOUSE STYLE URBAN PALE BY LA SIRÉNE. La Siréne owns a trade mark registration for the FARMHOUSE STYLE URBAN PALE BY LA SIRÉNE Label Device in class 32.
Urban Alley commenced proceedings against La Siréne claiming that La Siréne's use of the words URBAN PALE constituted infringement of its URBAN ALE trade mark and amounts to misleading and deceptive conduct under the Australian Consumer Law and the tort of passing off. Urban Alley also sought cancellation of La Siréne's trade mark registration for the FARMHOUSE STYLE URBAN PALE BY LA SIRÉNE Label Device. La Siréne defended those claims and sought cancellation of the URBAN ALE mark on the basis of sections 41 (lack of distinctiveness), 44 (substantially identical or deceptively similar to a prior mark) and 58 (not the first user) of the Trade Marks Act 1995 (the Act). La Siréne also cross-claimed that Urban Alley made groundless threats of infringement under section 129 of the Act.
The Court's findings
Cancellation of registrations and trade mark infringement
La Siréne was successful in relation to most of the claims. The Court held that the URBAN ALE registration should be cancelled on the basis of sections 41 and 44 of the Act. The Court found that the URBAN ALE mark is not to any extent inherently adapted to distinguish Urban Alley's beer products from those of other beer producers. The evidence established that the words URBAN ALE have become associated with craft beer products and describe the beer as being produced in an inner city location, which has market appeal for that reason. In making that finding, the Court dismissed the fact that other marks that contain the word "urban" have been registered in class 32 and referred to a similar case where the words PACIFIC ALE were found to have a descriptive aspect in relation to beer.
The section 44 ground was satisfied because the URBAN ALE mark was found to be deceptively similar to a prior registration for the URBAN BREWING COMPANY (owned by Urban Purveyor Group Pty Ltd) because of the associated meaning of "Brewing Company" and "ale" and the common use of the word "urban" as the first word in the marks.
While the Court's findings on the cancellation meant that the trade mark infringement claim would fail, the Court still considered that claim. La Siréne did not contest that the words URBAN PALE are substantially identical or deceptively similar to the mark URBAN ALE. However, La Siréne successfully argued that it did not use the words URBAN PALE as a trade mark, but rather as a product name that is descriptive of the nature and style of the beer, and that it used the words in good faith to indicate a quality or characteristic of its beer product.
Misleading and deceptive conduct and passing off
Urban Alley also failed in its misleading and deceptive conduct and passing off claims because the evidence did not demonstrate to the Court that Urban Alley had a reputation in the name "Urban Ale". The Court also dismissed Urban Alley's arguments that La Siréne's trade mark registrations should be cancelled.
Groundless threats
Finally, La Siréne failed in its groundless threat claim against Urban Alley because the alleged threat was made by Urban Alley's predecessor, not Urban Alley itself. Interestingly the Court commented on the fact that La Siréne made the groundless threats claim as a cross-claim noting that the relevant sections in the Act contemplate that a groundless threats action would be made before an infringement proceeding was commenced.
Authors: Annika Barrett, Senior Expertise Lawyer; and Lisa Ritson, Partner.
