November 1, 2012
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AUSTRALIA: Well-Known WINNEBAGO Mark Overcomes Obstacles to Obtain Injunction
On July 25, 2012, the Federal Court of Australia issued its decision in Winnebago Industries Inc v. Knott Investments Pty Ltd (No. 2) ( FCA 785). The proceeding included claims for passing off, misleading and deceptive conduct and false representations. In the decision, the U.S. company Winnebago Industries succeeded in obtaining injunctive relief to restrain the Australian company Knott Investments from making unauthorized use of the well-known WINNEBAGO trademark in relation to recreational vehicles (RVs), despite the fact that Winnebago had not traded in Australia when Knott commenced using the mark.
Winnebago commenced use of the WINNEBAGO trademark in the United States in relation to RVs in the 1960s. Knott commenced use of the WINNEBAGO trademark in Australia in relation to RVs in the late 1970s after its director (Binns) visited the United States and came into contact with the brand. The judge did not accept evidence from Binns that he did not intend to trade off the reputation of the U.S. company in deciding to adopt the mark. Winnebago became aware of Knott’s use of the WINNEBAGO trademark in about 1985.
The case is of interest because Winnebago was able to establish sufficient spillover reputation in Australia on the basis of the number of Australians traveling to countries where Winnebago RVs had been sold (United States, Canada, United Kingdom and Europe), the conversations and actions of visitors to Australia from such countries and the intentional action of Knott in adopting the name to preempt Winnebago’s opening in Australia. On this basis, use of the WINNEBAGO trademark by Knott was found likely to mislead and deceive Australian consumers.
The fact that in 1992 the parties had entered into a settlement agreement (described by the judge as a “standstill agreement”) that did not seek to restrain Knott from continuing to use the WINNEBAGO trademark in Australia did not prevent injunctive relief from being granted because Winnebago had expressly reserved its legal rights in the agreement. It appears from the decision that Winnebago entered into the agreement because it did not wish to incur the costs of litigation at a time when there were no plans to commence trade in Australia.
Winnebago’s delay of 25 years in taking legal action also did not preclude the granting of injunctive relief. However, interestingly, the judge proposed to suspend the operation of the injunctive relief to allow time for the respondents to rebrand their business, bearing in mind the costs of rebranding and the fact that the respondents had been allowed to trade extensively under the WINNEBAGO mark and name for a long period of time.
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© 2012 International Trademark Association