News & Insights

On 8 February 2023, the Federal Court of Australia tapped the keg on a new judgement for us to blow the froth off. Brick Lane Brewing Co Pty Ltd v Torquay Beverage Company Pty Ltd [2023] FCA 66 is a misleading and deceptive conduct dispute between the producers of “Sidewinder” and “Better Beer” beer respectively.

Competing products: Same, same but different?

Brick Lane issued a media release on 21 July 2021, announcing its new “Sidewinder” low alcohol beer range. The release included an image of a can of “Sidewinder”. Sales commenced in August 2021.

On 26 July 2021, Mighty Craft Ltd (one of the respondents in the case) made an announcement to the ASX that it would be partnering with Torquay and the comedians The Inspired Unemployed to form Better Beer Co and launch “Better Beer”. Sales of “Better Beer” commenced in October 2021.

There was significant similarity between the get-up of the respective products, both:

• being in off-white 355 ml cans;
• featuring blue, orange and yellow stripes; and
• labelled in dark text (black for “Sidewinder”, dark blue for “Better Beer”).

More images can be found at the end of the court judgement.

Basis of the dispute

Both parties applied to register trade marks for their respective stripes: Torquay on 13 August 2021 and Brick Lane on 1 November 2021. However that was not the basis of the litigation, as none of those trade marks had been (or are yet) registered.

Brick Lane brought proceedings against Torquay and associated parties for:

• misleading and deceptive conduct, contrary to section 18 of the Australian Consumer Law; and
• false and misleading representations as to sponsorship, affiliation or characteristics, contrary to sections 29(1)(g) and (h) of the Australian Consumer Law.

The Australian Consumer Law is contained in Schedule 2 of the Competition and Consumer Act 2010 (Cth).

Relevant considerations for brand protection

These provisions are aimed at protecting consumers and liability does not require fault.

In determining whether consumers are likely to be misled or deceived, the court laid out (at [34]) that relevant factors include:

• the strength of Brick Lane’s reputation and extent of product distribution;
• the strength of Torquay’s reputation and extent of its advertising;
• the nature and extent of the differences between the products;
• the circumstances in which the products are offered to the public; and
• whether Torquay has copied Brick Lane’s product or intentionally adopted its prominent features and characteristics.

The date for determining whether consumers are likely to be misled or deceived is the date that the impugned conduct began, not some later date.

The court’s conclusions: Reputation matters

The primary reason why Brick Lane’s case failed was because on 26 July 2021, being the relevant date on which Torquay’s conduct began, “there was no appreciable knowledge amongst members of the relevant class of the Sidewinder get-up.” (at [97]). Consumers were not going to associate Torquay’s product with Brick Lane if those consumers are not familiar with Brick Lane’s product.

It didn’t matter that Brick Lane made its announcement 5 days before Torquay, because “Brick Lane had not established any appreciable reputation in its get-up. Without that, its claim must fail” (at [98]).

The court did acknowledge that when Torquay launched its “Better Beer” ginger beer in April 2022, Brick Lane “had developed a reputation such that the hypothetical consumer might be considered to be familiar with them on coming across the Better Beer ginger beer get-up.” (at [99]). However, by this stage that same consumer would also have become familiar with Torquay’s “Better Beer” get-up. That is a relevant consideration that reduces the risk of deception.

Two other factors were highlighted by the court:

• Firstly, in the context of the products’ distinctive and different names, “the other features of the get-up would have to be particularly close in resemblance, if not identical, for the get-ups as a whole, including the names, to be misleading or deceptive.” (at [102])
• Secondly, the significant variety of brands, as well as styles and types of beer within each brand, mean that consumers have a lot of details to look out for in selecting the right beer. Therefore, they are likely to be careful in making their purchases and pay attention to details (at [109]).

Lessons from the case 

Relying on reputation-based rights to protect newly launched products or services from similarly-branded competitors is not going to work. Reputation takes time to acquire. Because the analysis is undertaken at the time that the impugned conduct begins, you can’t necessarily wait in the expectation of suing later on.

By contrast, registered trade marks do not rely on reputation. Once registered, infringement proceedings can be brought against somebody else using a substantially identical or deceptively similar trade mark, in relation to similar or closely related goods or services. The difficulty for both parties here was that they left it relatively late to apply for trade mark registration. If you want to be able to rely on your registered trade mark rights from your launch date, then you need to apply for registration at least 7½ months before then. While registration is backdated to the date of application, that doesn’t help if you need an injunction right now.

So apply for trade mark registration early, not right before or even after launch. And register distinctive elements of the packaging, because in this case it was the appearance of the packaging rather than the names of the brews that was in dispute.

The Macpherson Kelley IP team has extensive experience in identifying and registering valuable trade marks, and helping our clients in infringement disputes.