IP row highlights need for clearer agreements

NATIONAL: The latest intellectual property dispute to hit the Federal Court of Australia has exposed the risks of entering individual trade mark agreements.

Founders of European marketing and distribution company Lucky Charm, which was set up to market casualwear collections bearing the El Nino brand, have locked horns over rights to the El Nino trade mark. The fracas first erupted in 2000, when business partners Joseba Andoni Galdeano and Juan Pozo Segura entered an oral agreement for joint ownership of the trademark. As part of the agreement, Galdeano and Segura determined when Lucky Charm expanded beyond its European headquarters, trade marks in other countries would be obtained under both directors' names.

In 2003, Galdeano successfully entered an application to the Australian Registrar of Trade Marks to register a composite trade mark comprising the words 'El Nino Tarifa'. The application, lodged after relations between both business partners soured, was accepted despite opposition from Segura, which argued Galdeano was not the owner of the original mark.
Late last month, Segura successfully appealed the decision in the Federal Court of Australia and the decision by Registrar Trade Marks was set aside.

Justice Ryan found the trade mark was jointly owned by the two parties due to their oral agreement, and therefore one of them was not entitled to apply for the new mark. In addition to this, Justice Ryan ordered Galedeano to pay the cost of Segura's appeal and of proceedings before the Registrar of Trade Marks.

Lisa Egan, senior associate at Middletons law firm, said the lesson for fashion businesses was to ensure clear agreements governing the ownership and use of trade marks. "In most cases, trade marks will be owned by the corporate entity rather than the individuals, which makes it clear that the trade mark is the property of the company."

"Where the individuals wish to own the marks themselves, they should ensure there are clear agreements in place to clarify the ownership of the mark and that the company is exclusively licensed to use the trade mark."

By Assia Benmedjdoub