Playing for peanuts – Kraft v Bega
On 15 April 2020, the Full Court of the Federal Court of Australia in Kraft Foods Group Brands LLC v Bega Cheese Limited  FCAFC 65 upheld the decision that Kraft’s iconic peanut butter trade dress, which consists of a yellow lid, clear jar and red and blue labelling belongs to Bega Cheese Limited (Bega). Although Kraft had not previously tried to protect elements of the peanut butter trade dress as trade marks, Bega acquired title to the trade dress in 2017 when it purchased the assets from a number of Kraft’s Australian and New Zealand subsidiaries, including Kraft’s peanut butter business. Importantly, Bega’s asset purchase included acquiring all assets and goodwill of Kraft’s Australian subsidiary Mondelez Australia (Foods) Ltd (Mondelez), which had been using Kraft’s iconic peanut butter trade dress in the Australian market for a number of years.
In dismissing Kraft’s appeal, the Full Federal Court of Australia confirmed the primary judge’s interpretation that, according to Australian law, unregistered trade marks cannot be assigned without the underlying goodwill of the business in which the trade mark is being exploited. As such, Mondelez assigned the trade dress in the form of unregistered trade marks to Bega (possibly without much thought) when it sold all of its assets and goodwill to Bega. A detailed analysis of the appeal can be found here.
When being a good Samaritan could leave your brand exposed?
In response to the COVID-19 pandemic and with shortages on the production and supply of key products in the medical, hygiene and protective equipment fields, a number of well-known brands have converted their production facilities to help meet the shortfall. Well known fashion brand, Louis Vuitton has repurposed its perfume production lines to make hand sanitiser in France, the Armani Group are producing single-use medical overalls for health-care providers, whereas Ford, Tesla and General Motors have all begun producing ventilators in the United States.
While not to discourage brand owners and those with the necessary resources from responding to the public’s need in a time of crisis, brand owners should exercise caution when entering new industries to ensure that their good Samaritan act does not result in an infringement of someone else’s intellectual property rights. For example, companies should undertake their own due diligence and conduct trade mark, patent and design searches to ensure that no other entities hold conflicting rights that could prevent the production of such goods in Australia and if required, obtain a licence to produce such goods.
If you have any questions in relation to any of the information outlined, please do not hesitate to get in touch with a lawyer in Coleman Greig’s Intellectual Property Team, who would be more than happy to assist you today.