A Wrinkle in the Federal Court’s Decision on Trademark Infringement: Full Court Reverses Botox v. Protox Finding – Intellectual Property

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This article reports on the appeal before the Full Court of a decision concerning the infringement of the trademark BOTOX by the use of PROTOX (Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2021] PCAFFC 163). In a unanimous judgment, the Full Court (composed of Justices Jagot, Lee and Thawley) allowed Allergan’s appeal, clarifying the law relating to deceptive similarity and what constitutes trademark use. This important ruling clarifies the extent to which businesses may use, refer to, or seek to refer to another business’s mark or mark.

We have already reported on the first instance decision of
Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd
[2020] FCA 1530 in an article here.

Brief overview of the litigation and the initial decision of the Federal Court

Allergan Inc. (Allergan) is the registered owner of several BOTOX trademarks, including two BOTOX trademarks registered in class 5 for “pharmaceutical preparations”, and two other trademarks, including a defensive trademark, in class 3 for “cosmetics,[…]skin creams and lotions.

Self Care IP Holdings Pty Ltd and Self Care Corporation Pty Ltd (Self-care) sell cosmetics, including Protox, under the FREEZEFRAME umbrella brand. Self Care’s marketing and packaging described the word BOTOX in compound phrases, such as “clinically proven to prolong the effect of Botox®.”

Allergan argued that such use constituted, among other things, trademark infringement within the meaning of the Trade Marks Act 1995(Cth) (the Act) because the PROTOX mark was “deceptively similar” to the BOTOX mark and Self Care used the BOTOX mark on Freezeframe products, packaging and advertising.

At trial, Stewart J found that Allergan had not established infringement of the BOTOX mark. His Honor concluded that the pervasive reputation of the BOTOX mark successfully countered a misleading finding of similarity, as consumers are unlikely to have an imperfect recollection of such a well-known mark.

The Court also declined to void Allergan’s defensive trade mark registration (a finding that Self Care did not appeal).

Misleading similarity: the correct test is whether there is confusion as to the source of the goods, not confusion between the marks themselves

Given that a brand’s reputation is generally not relevant to the assessment of deceptive similarity, it is not surprising that Allergan appealed this decision.

Upholding Allergan’s appeal, the Full Court ruled that PROTOX is deceptively similar to BOTOX because there was a real risk that consumers would question whether the two products came from the same source.

Critically, the Full Court pointed out that the confusion to which the relevant provisions of the law are directed is confusion as to the The source products versus confusion
between brands or the products themselves.1 This “contextual confusion” approach to deceptive similarity is sufficient to establish that one mark is deceptively similar to another (although it is not the only way to establish such confusion). However, it is clear from past decisions that the test is not whether consumers might think the marks are the same, but whether the goods come from the same source.2

The “contextual confusion” approach finds a misleading similarity when the two marks themselves would not be confused (for each other) due to differences in appearance, pronunciation or idea, but where consumers (understanding that the brands are different) might wonder if they came from the same source. This is relevant here because the Full Court (approving the lead judge’s conclusion) concluded that consumers would not have confused PROTOX with BOTOX, as the words are sufficiently different.

The concept of contextual confusion contradicts the argument often made against owners of established marks that a well-known mark is simply too famous to allow any confusion with a similar mark.3 This also contradicts the reasoning of the trial judge, since the notoriety of the BOTOX mark is relevant to the question of whether the marks would be confused with each other. However, notoriety is irrelevant to the question of whether consumers might wonder whether the respective products come from the same source (eg one might be a variant of another). The Court suggested that consumers might have to wonder if PROTOX was a cosmetic (non-medicinal) variant of BOTOX that worked the same way, or if it was a treatment to be used in conjunction with BOTOX to improve or prolong results.4

Use as a trademark

The use of PROTOX by Self Care was used as a trademark

Self Care issued a Notice of Dispute that it was FREEZEFRAME PROTOX that it was using as its trademark, and not the word PROTOX alone. The senior judge concluded that it was “quite clear that PROTOX is being used as a trademark”.5

On the PROTOX product packaging, the word PROTOX was used separately from the word FREEZEFRAME. In addition, the two words were presented on different colored backgrounds. This allowed the Full Court to conclude that Justice Stewart was correct in concluding that PROTOX was used as a trade mark and that it was used independently of the FREEZEFRAME mark.

Self Care’s references to Botox have been trademarked and misleading

The Full Court found that Self Care’s use of the phrase “instant alternative to Botox®” was used as a trademark. This contrasts with Stewart J’s conclusion that the sentence was descriptive. Stewart J had argued that the word “alternative” served to emphasize that the product was not a BOTOX product. Although the Full Court accepted that the word “alternative” describes another possibility or choice,6 it did not mean that the commercial source was different. Therefore, use of this word did not protect Self Care against infringement of Allergan’s trademark.

Although the words “instant” and “alternative” are descriptive, the Full Court held that the term “instant alternative to Botox®” was not used by Self Care in a purely descriptive manner to distinguish its product from Allergan. Rather, it was used to denote a commercial source link to Allergan’s products and as such constituted trademark use. This was contrasted with the phrase “Yeast Tablets, a substitute for Yeast-Vite”, which was held by the House of Lords to adequately distinguish the products from each other and was therefore not considered to be a use as a trademark.seven

Other Federal Court findings include:

  • “Instant Botox® Alternative” was not used in good faith to indicate the intended use of the product’s features, therefore the 122(1)(b) defense failed.

  • The expression “instant alternative to Botox®” was misleading or misleading as to its effectiveness (under the Australian Consumer Law), as this would indicate to consumers that the effects of the PROTOX product would last for the same period of time as the effects achieved by a BOTOX treatment.

  • Registration of FREEZEFRAME PROTOX does not provide a defense under Section 122(1)(e) for use of PROTOX alone.

Key points to remember

This decision reiterates that contextual confusion is an important consideration in assessing deceptive similarity between marks. It should be kept in mind when prosecuting (or defending) trademark infringement claims that confusing trademarks themselves is not the right approach. Rather, the relevant issue is consumer confusion as to the source of the products.

The finding that the phrase “instant alternative to Botox®” was trademark use, and therefore amounts to trademark infringement, is important for businesses. Companies should think carefully before using third-party brands in comparative advertising. Use of a term such as “alternative” may not be sufficient to avoid a finding of trademark infringement.

Finally, the decision also highlights the strength and importance of defensive registrations of well-known marks. It was the defensive BOTOX record that the Full Court ultimately found to have been infringed, rather than one of the standard BOTOX records. Allergan’s standard BOTOX registration for “cosmetics” had been successfully attacked for non-use. However, a non-use attack is not an option against defensive registrations, and the BOTOX defensive registration covering “cosmetics” (being the products of Self Care) was found to be validly granted and therefore infringed.

Footnotes

1 Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2021] PCAFFC 163 [30].

2See, for example, Tivo Inc v Vivo International Corporation Pty Ltd [2012] CIF 252 to [102]; and on appeal Vivo International Corporation Pty Ltd v Tivo Inc (2012) 294 ALR 661 at [77]; [2012] CFAF 159.

3 See, for example, Mars Australia Pty Ltd v Sweet Rewards Pty Ltd (2009) 84 DPI 12.

4 Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2021] PCAFFC 163 [43].

5 Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2020] CIF 1530 [198].

6 Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2021] PCAFFC 163 [57].

seven Irving’s Yeast-Vite Ltd v Horsenail (1934) 51 RPC 110, 115.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.





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