A Dolphin Tale: The Commercial Realities of Trade Mark Consent in Australia

Co-authors: Candice Noring and Riet van den Ende

A recent unsuccessful consent request from the Redcliffe District Rugby League Football Club (‘Dolphins NRL Club’) to a Brisbane-based surfboard fin designer has led to a trade mark dispute between the parties. My colleague, Riet van den Ende, and I will provide a brief run-down on the commercial realities of securing a formal consent letter or responding to a request for consent in Australia.

IP Australia allows confusingly similar trade marks to co-exist on the Australian Trade Marks Register where the owner of the earlier trade mark consents. A formal letter of consent becomes relevant when an objection has been raised under section 44 of the Trade Marks Act 1995 (Cth) during the examination process of a trade mark application based on an earlier trade mark. A signed consent letter (or co-existence agreement) from the owner of the earlier mark can overcome this objection, even if the respective trade marks and the claimed goods and/or services are the same or similar.

In practice, an earlier trade mark owner may be inclined to provide consent when:

• the parties operate in different industries, markets, or geographical regions;
• the applicant of the later-filed trade mark application has used the mark honestly and concurrently for some time; and/or
• it is agreed between the parties that the risk of consumer confusion is low.

In exchange for providing a letter of consent, the owner of earlier rights may require the applicant to pay towards its reasonable legal costs, although the required contribution may need to be reasonable and proportionate to the relatively low costs of initiating a removal action – particularly in cases where the earlier mark may claim protection over broadly listed goods/services items, or where it may not be used (in good faith). In some cases, the earlier rights owner may also require the addition of a limitation to the items claimed in the new application, in accordance with the parties’ distinct operative fields.

Of course, trade mark consent requests may not be received with open arms where the earlier trade mark is in use or even enjoys a significant reputation. A trade mark consent request ultimately incurs some risk: if the request is denied or associated negotiations are intricate, it may lead the parties into the jaws of a non-use removal application, opposition, or infringement action.

The “Dolphin” trade mark dispute serves as an example of those risks, as discussed below.

It’s all Fins and Games until Someone Gets Splashed

Mr Larry Kershaw (‘Kershaw’), the designer of a surfboard fin, owns Australian Trade Mark Registration No. 969408 for DOLPHIN in class 28 for surfboard fins, longboard fins, and standup paddleboard fins (filing date: 19 November 2018) (‘Registration’). His Registration is currently subject to a non-use removal action brought by the Dolphins NRL Club.

The Dolphins NRL Club has successfully registered the following DOLPHINS and DOLPHINS-formative word and logo trade mark registrations:

• 1008807 DOLPHINS in class 41;
• 1008805 REDCLIFFE DOLPHINS in classes 25, 41;
• 1124804 in classes 25, 41;

• 1124803in classes 25, 41; and

• 2269834 in classes 14, 16, 21, 27, 41.

However, the Dolphins NRL Club has so far been unable to achieve protection for the following trade mark applications (‘Applications’):

• 2228305 DOLPHINS in classes 9, 14, 16, 18, 21, 24, 25, 27, 28, 41; and
• 2228306 in classes 9, 18, 24, 25, 28,

because IP Australia has cited Kershaw’s Registration as being too similar and raised it as a barrier to the acceptance of both Applications. This is because the Applications claim various sporting equipment and accessories in class 28, which overlaps with the registered surfboard fin goods contained in Kershaw’s Registration in the same class.

To overcome this objection, Dolphins NRL Club sought Kershaw’s consent to the use and registration of their Applications, as well as from other owners of dolphin-themed trade marks (that were likely also cited against the Applications), such as from Swimming Australia Limited. Where other trade mark owners have provided consent, Kershaw has refused the request.

In a recent article from the Brisbane Times, Kershaw said he countered the Dolphins NRL Club’s request for a letter of consent with a requirement for A$50,000 in monetary compensation – an amount that goes well beyond the usual request for payment of reasonable legal fees – in exchange for providing consent. Since then, Dolphins NRL Club has filed a non-use removal action against Kershaw’s Registration. The removal action is currently awaiting a request from either party for a decision, based only on the evidence they filed, from the Australian Trade Marks Office.

We will be watching with interest to see how the matter unfolds.

Key Takeaways for Trade Mark Consent

• IP Australia may object to the registration of a new trade mark application based on earlier trade marks deemed too similar – this type of objection may lead to a refusal of the trade mark in Australia, unless a signed letter of consent is obtained from the owner of the earlier trade mark or this earlier trade mark is (partially) removed due to non-use.
• In exchange for considering a request for consent, an earlier trade mark owner may require payment of its reasonable legal fees. However, requiring high sums to be paid in exchange for consent may risk having a counterintuitive effect, as an earlier trade mark owner may opt to seek (partial) removal of the earlier mark at a more cost-effective rate instead.
• Engaging an experienced Trade Marks Attorney to help secure a consent letter or respond to a request for consent is recommended, to ensure best prospects of a suitable outcome that protects your commercial interests.

If you have received a request for consent or have any questions relating to the above, please reach out to our trade marks team for expert guidance and advice.