Marketing a product as an “alternative” is not an answer to trademark infringement

0

The Full Court of the Federal Court found that marketing a product as an “alternative” to a trademark is not a response to an allegation of infringing use as a trademark. In Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd,1 Justices Jagot, Lee and Thawley took a broad view of the “use” of the trade-mark and the likelihood of consumer confusion, concluding that “PROTOX” and the “instant alternative to Botox® are deceptively similar to the caller’s “BOTOX”. ” and that the protection of the respondent’s defensive recording was ineffective.

Key points to remember

  • The use of the phrase “Instant Alternative to Botox®” was deemed to constitute use “as a trademark”, such that it infringed the registered trademark for BOTOX.
  • Although it depends on the context, the mere use of the word “alternative” to describe a product (for example, “instant alternative to Botox®”) may not be sufficient to prevent trademark infringement. Indeed, in some circumstances it may imply some association with the commercial source.
  • Although an exception to infringement exists under the Trademark Law for comparative advertising, it is easy to escape the protection of this provision. In particular, the mere reference to a competing product is not sufficient to fall within its scope.
  • Advertisers should exercise caution and avoid references to competing products that seek to take advantage of the competitor’s reputation, rather than comparative advertising with that product in good faith.

Background

The famous Botox injectable powder is used in therapeutic and cosmetic treatments. It is manufactured, sponsored and sold in Australia by Allergan, under its various “BOTOX” brands. These marks are registered for a variety of products, including “anti-aging” and “anti-wrinkle” cosmetics.

In 2014, Self Care launched a line of anti-wrinkle skin care products under the “Freezeframe” brand. The Freezeframe line included “PROTOX”, a skincare product designed as a non-injection solution to “extend the appearance of Botox®”, and an “Inhibox” product which was considered an “instant alternative to Botox®”. Self Care sold these and other products under its “FREEZEFRAME” trademark. Later, it obtained the trademark registration “FREEZEFRAME PROTOX” despite the opposition of Allergan.

Allergan commenced proceedings alleging, among other things, that Self Care infringed Allergan’s BOTOX trademark through both its use of “PROTOX” and its use of “the instant alternative to Botox®” in connection with Inhibox.

The lead judge ruled in favor of Self Care, finding that “PROTOX” was not deceptively similar to “BOTOX” and that the phrase “instant alternative to Botox®” did not constitute an infringing use of BOTOX “like trademark “. These findings were overturned by the Full Court on appeal.

The decision of the Full Court

PROTOX is deceptively similar to BOTOX

The lead judge had held that PROTOX was not deceptively similar to BOTOX because His Honor had found that, although consumers would remember BOTOX when seeing the trade mark PROTOX for the anti-wrinkle cream, they would not have confused the PROTOX products with BOTOX products.

The Full Court agreed with the factual findings of the lead judge, but disagreed that this meant that PROTOX was not deceptively similar to BOTOX. Indeed, the Full Court clarified that the relevant “deception” is not whether consumers would confuse one product with another, but whether consumers would be led to wonder whether the underlying products came from the same source. The similarity between the words was such that a consumer might wonder if the products were related: for example, a consumer might wonder if the creators of BOTOX had decided to expand their product line to include topical cosmetics such as “PROTOX”. The mark was therefore deceptively similar to Allergan’s mark for the purposes of section 120 of the Trade Marks Act 1995 (Cth) (Trademark Law).

Ineffective defensive save

Self Care argued that it had an express defense against infringement because it had obtained trademark registration for “FREEZEFRAME PROTOX”. However, in fact, the Protox product livery did not use the words together compositely. The words appeared on different facets of the packaging and used a different color scheme, font, and font case. The Full Court therefore agreed with the Senior Judge that the word “PROTOX” was used as a separate mark, so Self Care’s registration for FREEZEFRAME PROTOX did not provide it with a defense against infringement.

“Instant Alternative to Botox®” is used “as a trademark”

Under Australia Trademark Law, the mere use of another registered mark does not constitute an infringement of that mark, unless it is used “as a mark”. This is generally understood to mean that the mark should be used as a “sign of origin” in connection with goods or services.

The lead judge found Self Care’s use of the phrase “instant alternative to Botox®” to be descriptive. His Honor also considered that the word “alternative” did indeed distinguish the Inhibox product from the Botox product and therefore the phrase was not used by Self Care as a badge of origin for the Inhibox product.

The Full Court disagreed and found that the term “Instant Alternative to Botox®” as a whole was used as a trademark because:

  • Although the word “alternative” implied that the two products were different, it did not imply that the products came from a different source.
  • Although “instant” and “alternative” are descriptive, the entire phrase “instant alternative to Botox®” was not purely descriptive. Instead, it denoted a commercial source link to Botox products (to the effect that the Inhibox product was not the Botox product).
  • The Inhibox product packaging and website displayed the words “Inhibox”, “Freezeframe” and “instant Botox® alternative” with such prominence that each appeared to be a trademark.
  • Even though the product packaging identified Allergan as the owner of the “BOTOX” trademark, this was not sufficient to dispel any doubt as to Inhibox’s commercial source. Even a diligent consumer might reasonably assume that Self Care had some form of license or permission from Allergan to use the mark on their product.

Comparative Advertising & “Good Faith” Use

Self Care has also sought to invoke certain exceptions to infringement under the Trademark Law with respect to its use of “the instant alternative to Botox®”, including that its use of the phrase was “for purposes of comparative advertising” within the meaning of Section 122(1)(d). The Full Court rejected this argument because:

  • Technically, Their Honors said the exception does not apply to personal care, as the provision refers to “the use of the trademark” (i.e. “BOTOX”), while the infringing use was of the phrase “instant alternative to Botox®”.
  • Even if the exception could apply, the Court held that Self Care’s behavior could not be qualified as “comparative advertising”, since the “instant alternative to Botox®” phase was “used to take advantage of the reputation of BOTOX, and not to advertise Inhibox versus Botox”. The finding that consumers would question whether the products came from the same source was relevant to this conclusion.

Self Care has also sought to invoke other exceptions, which provide that a person does not infringe a registered mark if he uses the sign “in good faith” to indicate a characteristic or the purpose of goods or services. The Court also rejected these arguments for similar reasons.

Misleading Representations: Time Matters

In addition to its trademark infringement complaint, Allergan had alleged that the phrase “instant alternative to Botox®” indicated that Inhibox would deliver results of the same quality or standard as Botox, which Allergan claimed was misleading or misleading. misleading in violation of Australian Consumer Law (ACL).2

The Court agreed that the phrase “instant alternative to Botox®” would have been understood by affected consumers to mean that Inhibox both caused a similar reduction in the appearance of wrinkles and that this effect lasted as long as Botox . In this regard, the Court also noted that the target market included consumers who understood that Botox continued to “have an effect for a period of 4 months after treatment”. On the other hand, at the highest, the studies on which Self Care relies established that their active ingredient would reduce wrinkles “over a period of application of 28 days”, but said nothing about the duration of the effect. after stopping the application. As such, the Court also agreed that this sentence violated the ACL.

Consequences

The Full Court’s findings serve as an important reminder for those seeking to distinguish their products or services from those of competitors. While each case depends on its facts, simply presenting a product as an “alternative” may not sufficiently distinguish the commercial source from a competing product to avoid liability for trademark infringement.

Similarly, although Australia Trademark Law provides an express exception to infringement in relation to comparative advertising, the Court’s reasoning demonstrates that the scope of this exception can be narrow and that it is easy to deviate from its scope. In either case, it may be relevant to consider whether the impugned conduct was performed in good faith for the relevant descriptive purpose, or whether it was performed so as to “take advantage of the reputation of” the registered mark.

The ruling also serves as an important reminder that defensive brands won’t always be effective in protecting against trademark infringement claims. Where a registered mark consists of two or more words (or other elements), the mark must be used in its entirety to qualify for protection under the registration.

As explained above, the Court’s decision that the phrase “instant alternative to Botox®” was used as a trademark is not without controversy. Although it is possible that this could be appealed to the High Court, Self Care would need to seek special leave to appeal. Special leave is discretionary and is reserved for cases that meet certain public interest thresholds.3 As such, it is not clear that special leave would be granted.

Companies will need to exercise caution when marketing their products with reference to other goods. Descriptive or comparative phrases are not necessarily exempt from trademark infringement – as always, context is key.

Share.

Comments are closed.