Paul’s Retail Pty Ltd v Sporte Leisure Pty Ltd: Trade marks and Territorial Limitations

In Paul’s Retail Pty Ltd v Sporte Leisure Pty Ltd [2012] FCAFC 51  registered trade marks infringement of marks relating to apparel badged with the name and nickname of Golfer Greg Norman was alleged. The infringements were with respect to the importing and offering for sale in Australia of garments to which the marks had been applied by licensee for the territory of India. The claimed infringement was defened under the Trade Marks Acts 1955 (Cth) s 123 (the Act).

Key question were whether the trade marks applied to the garments were made by the licensee with the consent of the trade mark owner and whether the licensee was permitted to apply the marks to garments manufactured for sale by it in Pakistan.

Paul’s (the applicant) argued that the Act s 120(1) was not "enlivened" because it did not use the Greg Norman marks as trade marks otherwise than “as a badge of origin of GWS consistent with its exclusive rights” under the Act. The applicant then argued the primary judge erred in taking into account the territorial restrictions imposed on BTB under the licence between BTB and GNC when determining whether the Greg Norman marks were applied to the goods with the consent of the registered owner of the marks in accordance with the Act s 123. This issue turned largely upon whether the goods in question were to be regarded as “genuine goods”.  Counsel for the applicant argued that the case law authorities state that a registered trade mark is a badge of origin, not a badge of control, see Champagne Heidsieck et Cie Monopole Societe Anonyme v Buxton [1930] 1 Ch 330.

Another issue was whether the primary judge erred in failing to apply the “rule” in Blatch v Archer (1774) 1 Cowp 63; 98 ER 969 or the “rule” in Jones v Dunkel (1959) 101 CLR 298 by reason of a failure of the respondents to call Mr Singh, an officer of BTB, to give evidence. This issue arises because the applicant contended that the respondents ought to have called Mr Singh to give evidence on the question of whether GNC consented to the application of the Greg Norman marks on goods destined for sale outside India.

The fourth issue arose from the primary judge’s rejection of a cross-claim brought by the applicant alleging that the respondents engaged in misleading and deceptive conduct by reason of advertisements placed on the website www.shark.com.

Holdings: The appeal should be dismissed with costs.

"The primary judge found that the goods supplied by BTB to Sunsports were specifically manufactured by BTB for supply by it to Sunsports outside India and that this was forbidden by the terms of the licence agreement.  It follows that the goods were not “genuine goods” within the Champagne Heidsieck principle because they were not goods “upon which the plaintiffs’ marks were properly used”.  In this particular circumstance BTB stood in no different position to a third party applying the Greg Norman marks who had no licence agreement with GWS or its licensees."

"Section 20 of the Act gives the registered owner of a mark the exclusive right to use, or to authorise others to use, the trade mark.  Whilst these rights are subject to some territorial limitation, as was explained in Montana Tyres at [78], a sign or mark may be applied to goods anywhere in the world.  If the mark is used as a trade mark in Australia, the question becomes whether its application overseas was by or with the consent of the owner.... Here, unlike the situation which existed in Montana Tyres, the Greg Norman marks were applied without the consent of the registered owner."

"In the circumstances, the notion that Mr Singh was in the respondents’ camp at the time of the trial must be rejected."

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