What you need to know
- Use of the word "malishus" in the malishus.com domain name that resolved to a website offering for sale in Australia clothing branded with the word "malishus" was found to amount to infringement of trade mark registrations that incorporate the word MALISHUS.
- Except to a limited extent, assertions that the infringing activities were only being undertaken in relation to overseas markets did not succeed. The evidence demonstrated that goods bearing the word "malishus" were being offered for sale and sold in Australia via the malishus.com website.
- While only nominal damages were awarded for the infringement, a substantial amount was awarded in additional damages to signal to the respondents that there is a financial cost to infringement even where the trade mark owner is unable to prove damage was suffered.
What you need to do
- Be aware that attempting to limit the geographical reach of a website to ensure that you avoid infringing another party's rights in a particular country is difficult. It must be made expressly clear that the website is not directed to that country in any way.
Background
Mr Lamont owns four Australian trade mark registrations that contain the word MALISHUS. Three of the marks are registered for clothing, footwear and headgear and the fourth in respect of music.
Mr Lamont claimed in the Federal Circuit Court of Australia that one or more of the respondents (Malishus Limited and three individuals involved in the business) infringed one or more of his trade marks. Mr Lamont claimed that the respondents infringed the MALISHUS marks by:
- registering and using domain names incorporating the word "malishus" including malishus.com, malishus.co.nz and malishus.com.au to sell Malishus-branded clothing;
- by posting material on Facebook that included the word "Malishus" in connection with clothing; and
- selling t-shirts and other items to which the word "Malishus" was applied.
Mr Lamont also argued that by using the word MALISHUS the respondents had engaged in misleading and deceptive conduct.
The respondents admitted that Mr Lamont is the owner of the trade marks, that they registered and used the domain names and a business name including the word "Malishus" and that they used the name "Malishus" on clothing. However, the respondents argued that they undertook those activities only in connection with overseas markets of trade marks they registered in New Zealand, the USA and UK.
Trade mark infringement
Domain names
In relation to the trade mark infringement claims, Judge Manousaridis found that by using the word "Malishus" as part of the malishus.com domain name that resolved to a website that displayed and offered for sale clothing that displayed the word "Malishus", the respondents were infringing Mr Lamont's MALISHUS trade mark registrations.
The earliest of Mr Lamont's registrations was for the mark MALISHUS KONCEPT. Judge Manousaridis concluded that the domain name was deceptively similar to the MALISHUS KONCEPT mark noting that while "malishus" sounds like the word "malicious", the different spelling adds a degree of distinctiveness that would make more than a fleeting impression on consumers' minds. Judge Manousaridis also noted that the word "koncept" was unlikely to detract in a material way from the distinctiveness of the word "malishus".
In relation to the respondents arguments that their conduct was directed outside of Australia, Judge Manousaridis concluded that the evidence indicated otherwise and that the malishus.com website represented that the clothing displayed was available for purchase in Australia. There were also statements in Facebook posts that indicated the clothing could be purchased via the website from Australia such as the statement "Free Shipping Any Where".
There was no evidence that the malishus.com.au domain name was used and therefore it could not be established that it had been used as a trade mark. The malishus.co.nz domain name did not infringe because Judge Manousaridis found that it was directed solely to persons in New Zealand, not Australia.
Sale of clothing
Despite the respondents arguing that they only sold the Malishus-branded clothing to family and friends, Judge Manousaridis found that the respondents did in fact sell clothing bearing the trade mark in Australia from their websites and that conduct constituted trade mark infringement.
Facebook posts
In relation to the Facebook posts, Judge Manousaridis found that posting material on Facebook that included the use of the word "Malishus" in connection with clothing also amounted to trade mark infringement.
Misleading and deceptive conduct
The misleading and deceptive conduct claims were dismissed because the evidence did not establish that Mr Lamont had the required reputation in its MALISHUS marks in Australia.
The remedies awarded
Judge Manousaridis granted declaratory and injunctive relief and ordered that the business name and malishus.com and malishus.com.au domain names be cancelled. He also ordered that the respondents file and serve an affidavit stating whether they hold any items of clothing bearing the MALISHUS mark and if they do, to state whether they have been destroyed or confirm that the mark has been removed.
In relation to damages, Mr Lamont was awarded nominal damages of $10 (because there was no evidence of any profit made by the respondents or damage to Mr Lamont's reputation or its marks). However, Mr Lamont was also awarded $25,000 in additional damages with $7,686.75 in interest. The additional damages were awarded because of the flagrancy of the respondents' conduct and the need to deter similar infringements. Judge Manousaridis stated that the additional amount should incorporate an element that would signal to the respondents that there is a financial cost to infringement even where the trade mark owner is unable to prove damage was suffered.
Mr Lamont was also awarded such costs as he was entitled to as an unrepresented litigant.
Authors: Annika Barrett, Senior Expertise Lawyer; Lisa Ritson, Partner.
