If your sweet tooth has you wandering the confectionary aisle in your local supermarket you have probably noticed the raft of imitation chocolate confectionary products, often manufactured under the supermarket's "home brand" and descriptively labelled. Products such as "milk whip" (think Milky Way) and "cherry bites" (think Cherry Ripe) spring to mind. A recent Australian decision suggests that in some cases there is little that a well-known confectionary manufacturer can do to prevent this activity, no matter how famous the product nor how closely the imitation product replicates non-distinctive elements of its packaging.
In Mars Australia v Sweet Rewards, the Australian Federal Court found that the distribution and sale of chocolate covered malt balls by Sweet Rewards Pty Ltd (Sweet Rewards) did not suggest that the product was connected to the famous Maltesers product manufacture by Mars Australia Pty Ltd (Mars) nor did the labelling infringe Mars' registered trade marks. This decision was affirmed by the Full Federal Court on appeal.
In Australia, Mars markets its famous Maltesers product in various forms of packaging, including the following (click here to see picture.)
Sweet Rewards distributes chocolate covered malt balls known as "Malt Balls" in discount stores which are packaged in the following container (click here to see picture)
Mars commenced proceedings against Sweet Rewards alleging that the Malt Balls packaging wrongly suggested a connection between Malt Balls and Maltesers, that the packaging wrongly suggested that Malt Balls are the same as Maltesers and that the packaging infringed two registered trade marks owned by it.
Did the Malt Balls packaging suggest a connection between the products?
The judge found that the elements of the Maltesers packaging in which Mars had a reputation consisted of the use of the brand name "Maltesers" in slanted script, the red background and the floating chocolate balls, some of which were cut in half. The Full Court agreed with this conclusion and noted that both the pictorial representation of the product on the packaging and its red background were, on the evidence, commonplace in confectionary packaging.
Given the principal component of the Maltesers get-up is the word "Maltesers", the judge found that it was unlikely an ordinary consumer would mistake anything that was not called a Malteser for a Malteser. His honour described Mars as being a "victim of its own success" and found that use of the name 'Malt Balls', the Delphi logo and slightly different visual features (including the different red used on the Malt Balls container) were sufficient to distinguish the Malt Balls product from the Maltesers product. This finding was not disturbed on appeal.
Did the Malt Balls packaging suggest that the products were of equivalent ingredients or taste?
His honour found that in the absence of a statement indicating that "Malt Balls taste like Maltesers", Mars' argument that there was a representation of product equivalence (which relied on deceptive similarity between the Malt Balls packaging and the Maltesers get-up) should be rejected. The Full Court agreed that no misleading or deceptive representation was conveyed by the Malt Balls' packaging.
Did the Malt Balls packaging infringe Mars' registered trade marks?
His Honour accepted Sweet Rewards' evidence that it had used the Delfi brand as a trade mark and that the words "Malt Balls" were intended to be descriptive only. None of the other elements of the packaging, including the floating chocolate balls, were found to have been used as a trade mark. The Full Court agreed with this conclusion.
This decision acts as a reminder that in order to succeed in an action against an imitation product manufacturer, it is not sufficient to merely point to the similarities between the two products, particularly if these are commonly used in the industry. If the first to market product has an unusual or distinguishing feature, the challenges to a successful prosecution are likely to be much greater.