A recent decision by the Full Court of the Federal Court of Australia in Knott Investments Pty Limited v Winnebago Industries Inc.  FCAFC 59 serves as a warning to trade mark owners to enforce their intellectual property rights promptly. It also highlights the dangers in using foreign trade marks that have acquired a reputation in Australia even though the foreign owner has not directly used the trade mark in Australia.
In 1978, Knott Investments Pty Limited (Knott) commenced manufacturing recreational campervans and selling those campervans under the brand name “Winnebago”. The Court found that Knott had intentionally adopted the brand of the famous Winnebago campervans manufactured in the US, which, at that time, were not being sold in Australia. The facts of the case are striking because Winnebago Industries Inc., the US company which manufactured and sold recreational campervans under the “Winnebago” brand name in the US, discovered Knott’s conduct in 1985 but failed to take any enforcement action against Knott until 2010.
At first instance, Justice Foster held that Knott had committed the tort of passing off and had engaged in misleading or deceptive conduct by adopting the “Winnebago” brand name to sell its vehicles. On appeal, the Full Court upheld Justice Foster’s finding in this regard but held that Winnebago’s delay in bringing an enforcement action meant that it was not entitled to the extent range of the injunctions awarded against Knott by Justice Foster, having regard to the substantial investment and reputation Knott had built up under the Winnebago brand name in Australia.
This case highlights the following points:
- businesses that delay in enforcing their intellectual property rights may not be able to obtain as strong injunctive relief than if they had sought to enforce their rights soon after becoming aware of any breach;
- businesses should be very careful in selecting brand names – due to the prevalence of the internet and on-line shopping, it will be much easier for a foreign brand name owner to prove that its brand name has acquired a reputation in Australia despite that owner not having used the brand name in Australia.
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