News & Insights

In a recent decision handed down by a Delegate of the Registrar of Trade Marks, PayPal, Inc. successfully opposed the registration of a Device Mark and Trade Mark filed on behalf of FinPal Pty Ltd (‘the FinPal Marks’).

PayPal is a leading multinational technology platform company that enables digital and mobile payments on behalf of consumers and merchants worldwide. FinPal  is an Australian financial planning software company.

Given that the Opponent and Applicant play in the same FinTech field, it came as no surprise that PayPal sought to prevent FinPal from receiving protection for their Device Mark and Trade Mark.

PayPal’s chief concern with the FinPal Marks is that the suffix ‘Pal’ as used by another company operating in the same industry may lead to consumer confusion, whereby consumers may mistakenly associate the PayPal and FinPal Marks with each other.

It is vital for companies to ensure that other businesses operating within the same industry are not permitted to have the power to affect each other’s reputation and brand equity.

This is a prudent approach for many reasons, most notably:

1. Failing to monitor for and oppose potentially infringing trade mark applications may lead to the degrading of the value of your business’ intellectual property rights;
2. A business operating within the same industry may intentionally or unwittingly cause consumers to believe that their business is associated with another by using a potentially infringing mark;
3. The ongoing use of a potentially infringing mark by another company may cause, through consumer confusion, damage to the reputation and brand equity of another company, which may have a direct effect on financial performance.

The Decision by the Delegate relied on PayPal’s ground of opposition under section 60 of the Trade Marks Act 1995 (Cth). Section 60 provides a ground for opposing the registration of a trade mark in Australia on the basis that the trade mark is similar to another trade mark that has acquired a reputation in Australia.

In considering this ground of opposition, the Delegate assessed the reputation of the PayPal Marks in Australia prior to the priority date of the FinPal Marks. The Delegate came to the conclusion that the PayPal Marks had  acquired a significant reputation in Australia before the priority date of the FinPal Marks.

Given the determination that the PayPal Marks had already acquired a significant reputation in Australia, the Delegate found that a “significant number of consumers would at the very least experience a reasonable doubt as to the existence of some sort of connection between the Opponent’s trade marks and the FinPal Marks if it were used to the extent of all of the goods and services listed in the opposed applications”.

As a result, the Delegate decided that the applications concerning the FinPal Marks were to be refused.

With their applications successfully opposed, FinPal may well be forced by PayPal to go through the costly process of rebranding its entire business to avoid trade mark infringement proceedings. In any event, an applicant that has failed to secure trade mark protection may wish to rebrand to a Device Mark and Trade Mark that is capable of being protected to fend off competitors in the marketplace.

Key Takeaways

1. It is sensible to seek legal advice before launching your brand to ensure that you are aware of the factors which may affect your ability to protect your brand in the future;
2. Another company’s use of a potentially infringing mark may cause, through consumer confusion, damage to the reputation and brand equity of another company, which may have a direct effect on financial performance; and
3. It is vital for any business to have a robust intellectual property protection strategy which includes the provision for monitoring for potentially infringing trade marks.

Businesses with valuable intellectual property need to be vigilant to prevent the unauthorised use of their creations. An effective intellectual property protection strategy can guard a brand against external forces. For more information about intellectual property protection and registering a trade mark in Australia, please contact us.

This article was written by Mark Metzeling, Special Counsel and Mitchell Willocks, Law Graduate – Commercial.