It’s every marketer’s wildest dream. The brand that they are marketing has achieved wide spread recognition and fame and is now so closely associated with the products that virtually no effort is required to market the brand. People talk about the product by referring to the brand and it has national or international recognition. While this may be every marketer’s dream, this is every Intellectual Property lawyer or Trade Mark Attorney’s nightmare. With great recognition comes the risk that the brand or trade mark is at risk of genericide, or removal from the Trade Mark Register because it is no longer inherently adapted to identify the mark. The mark comes to define a product, instead of being used as a badge of origin, and then that trade mark loses its value.
Key Takeaways on Trade Mark Protection
Use ™ or ® after your registered trade marks in all advertising or promotional material
Use your trade mark in conjunction with a noun. For example, “THERMOS flask” or “EVIAN water”.
Maintain tight control of your trade marks through licences and strict usage requirements.
Don’t use your trade mark in a descriptive way. Don’t say “Xerox it” say, “Make a copy with your Xerox copier”.
In New Zealand, inactivity of the trade mark owner is a key factor in ‘genericide’ or removal, so be proactive in maintaining and demonstrating correct usage.
What is genericide?
Section 24 of the Trade Marks Act 1995 (Cth) (‘the AU Trade Mark Act’) is the basis of the laws of removal of a trade mark when it has become ‘generic’. This states that if a registered mark contains a sign that becomes ‘generally accepted’ in the trade as a description or name of the article, substance or service then the registered owner loses the exclusive right to use the trade mark on goods and services of the same description,[i] dated from the day a court decides the trade mark had become generic.[ii] In the same way, trade mark owners may lose the exclusive rights to a name if it is related to a patented product which has now become generic. Once a patent has ceased to be protected, the trade mark of that name may also fall vulnerable to genericide. Section 25 of the AU Trade Mark Act covers the connection to articles, services or substances formerly manufactured under a patent. Rights to those trade marks cease at the end of the period two years after the date the patent expired or ceased.[iii]
In New Zealand, s18 of the Trade Marks Act 2002 (NZ) (‘the NZ Trade Mark Act’) sets out that ‘The Commissioner must not register …a trade mark that consists only of signs…that have become customary in the current language or in the bona fide and established practices of trade.’[iv] This process of removal covered by s66 of the Act. Section 66(1)(c) states that a trade mark may be removed from the register when ‘in consequence of acts or inactivity of the owner, the trade mark has become a common name in general public use for a product or service in respect of which it is registered’.[v] The difference between the laws in Australia and New Zealand mainly consists of a wording variation, that makes quite a big practical difference between the two countries. In Australia, a trade mark can become generic when ‘in the relevant industry’ it has become generic.[vi] On the other hand, in New Zealand, a trade mark becomes generic when it becomes a common name in ‘general public use’.[vii] Further, in New Zealand, this must be through the causation of the owner’s action or inaction. These slight differences can make a big difference in implementation of the law, which will be discussed further below.
Genericide in Australia
The important thing to remember about trade mark registrations is that they are to be used as a ‘sign’ or a badge of origin.[viii] It is when the trade mark has become descriptive of the product, then it is vulnerable to becoming generic. The rationale for this is well articulated by Dillon LJ in Mothercare UK Ltd v Penguin Books Ltd  RPC 113 at 118-119:
If descriptive words are legitimately registered in Part A of the register, there is still no reason why other people should not be free to use the words in a descriptive sense, and not in any trademark sense.
In Australia, the test for genericide is market based. This means that it is only when the mark has become generic ‘within the relevant trade’ that it is vulnerable to removal. For example, in Australian Health & Nutrition Association Limited t/as Sanitarium Health Food Company v Irrewarra Estate Pty Ltd t/as Irrewarra Sourdough  FCA 592, Sanitarium sought to prevent Irrewarra Sourdough from using the term ‘Granola’ on its products due to Sanitarium’s existing trade mark registration. This failed because the Court found that the word ‘granola’ was a generic term, and had a broader meaning in the food industry than just the Sanitarium product.[ix] In this they relied on evidence from an Australian cook book writer and others in the ‘relevant trade’.[x] In contrast, the Federal Court of New South Wales, in Alcon Inc v Bausch & Lomb (Australia) Pty Ltd  FCA 1299, dismissed evidence of ‘generic use’ of the trade mark ‘BSS’ from international markets as they were ‘not connected with the relevant trade’.[xi] In Mantra Group Pty Ltd v Tailly Pty Ltd (No 2)  FCA 291, the court gave some discussion to what the scope of ‘relevant trade’ would be and concluded that because trade mark registrations give exclusive rights of use in the Commonwealth of Australia, therefore, ‘relevant trade’ must be considered nationally.[xii]
The words of a trade mark may be used to describe goods or services and also serve as a badge of trade origin, [xiii] however in Johnson & Johnson Australia Pty Limited v Sterling Pharmaceuticals Pty Limited (1991) 30 FCR 326 is was found that the word ‘CAPLETS’ had only been used in a descriptive sense and not as an indicator of origin or identity.[xiv] ‘CAPLETS’ was found to be descriptive of the size and shape of the product and not necessarily the origin of the product.
While the Courts have the power to remove trade marks from the Register when they become generic, this does not appear to be the preferred method of resolving such issues. As noted above, Sanitarium lost the exclusive right to ‘GRANOLA’ due to genericide, however, its registration is still retained the registration. The Court made no orders that the trade mark should be removed or revoked and it remains on the register to this day. ‘CAPLETS’ too remains on the register. Classic cases discussed in other jurisdictions, in the US, for marks like ‘ASPIRIN’[xv],‘CELLOPHANE’[xvi] and ‘THERMOS’[xvii] still remain on the Australian Trade Marks Register. There seems to be a reticence to remove generic brands from the register. The US has a system similar to that of New Zealand where genericide is not limited to the ‘relevant trade’ but to the public at large. This may be one explanation for the unwillingness to remove marks from the Register. Other usual customs and legal practices may also be in play.
Genericide in New Zealand
Under the Trade Marks Act 1953 (NZ), trade marks could only be removed if there was ‘a well known and established use of the word…as the name or description of the article…by… persons carrying on a trade’.[xviii] The updated Act in 2002 has altered this to be, as described above, recognised by members of the general public. While this may seem like an easier burden of proof for someone seeking to remove a trade mark, the Act states it must be ‘in consequence of acts or inactivity of the owner’.[xix] Therefore, there is greater scope for the owner of the mark to demonstrate correct usage, and prevent misuse by the public to avoid revocation of the mark. The genericism must be attributable to its owner.[xx]
Similar to Australia, trade marks are able to retain their badge of origin, even as they are used in a ‘generic’ fashion. The High Court recently considered this in Tasman Insulation New Zealand Ltd v Knauf Insulation Ltd & Ors  NZHC 960 at - by reference to the following observation of Richard Arnold QC in Hormel Foods Corporation v Antilles Landscape Investments NV  RPC 28 regarding ‘SPAMBUSTER’:
As to s 46(1)(c), since 1938 the claimant’s mark has become a household name. In such circumstances it is not surprising that occasionally it is used by way of synecdoche to stand for canned luncheon meat generally in the same way as, for example, PERRIER is sometimes used to stand for carbonated mineral water generally (the synecdoche being the use of the species to stand for the genus). This does not mean that it has necessarily become truly generic, still less that this is due to the acts or inactivity of the claimant.
The activity or inactivity of the Owner to maintain or defend its trade mark were a key consideration in this case. The burden of proof for an applicant of removal was noted to be very high[xxi] and Knauf would have to show not only that the trade mark was generic, but that this had occurred through the causation of the owner. In DB Breweries Ltd v Society of Beer Advocats Inc,[xxii] the Court determined that not only did the applicant have to show that the make had become a ‘common name in general public use’ but also ‘the applicant has the onus of showing that in consequence of acts or inactivity of the owner’.[xxiii] Ultimately the Court found that ‘BATTS’ had not lost its ability to distinguish the Tasman product from other insulation products. The term ‘BATT’ could still function as a badge of origin. This is a similar approach to that taken in the US by the 9th Circuit court regarding use of ‘Google’ as a trade mark.[xxiv] The mere fact that the trade mark can be used as a noun or an adjective does not necessarily make it generic. In the US, much like in New Zealand, it was found that ‘until the trademark has gone so far toward becoming the exclusive descriptor of the product that sellers of competing brands cannot compete effectively without using the name’[xxv], it was not generic. No other internet company uses ‘a google’ in that sense.[xxvi] In that consideration, it appears that New Zealand has made it more difficult to remove a trade mark for genericism.
New Zealand places the onus for proving a mark has become generic on those alleging it and their case law suggests that the burden is very high, not withstanding it is applied to the public in general rather than in a ‘relevant trade’. Further, the trade mark owner’s active management of their mark allows them greater scope to protect their brand.
In conclusion, the differences between Australia and New Zealand are not mere semantic ones. There is a distinction between allowing genericide to occur in a ‘relevant trade’ or whether in a public at large. While both jurisdictions allow for the owner of the mark to take active steps to prevent their brands from becoming generic, in New Zealand, this action seems to hold greater judicial weight than in Australia.
While the differences between Australia and New Zealand are noticeable, there are also some significant similarities. Coming from a similar common law background, the two jurisdictions have some common ground. Both jurisdictions have mechanisms for removing trade marks from the register when they become generic. It appears that there is a preference for allowing the co-existence for the generic marks, rather than removing them altogether. The practical effect of the legislation in both jurisdictions is that trade mark owners must ensure that they use appropriate TM or ® marking with their marks and ensure that marketing campaigns use their full mark and not attempt to make the mark ‘shorthand’ for the product.
Given the nature of the internet and the future of brands, this will be an important area to consider when looking at the differences and similarities between trade mark registrations in Australia and New Zealand and the possibility of removal when considering a ‘generic’ brand. Trans-Tasman marketing campaigns may be run and contain similar usage of trade mark indicators, but the basis for this will vary depending on the jurisdiction. In Australia, these are indicators the mark is registered; in New Zealand, this is evidence against the generic grounds for removal.