In-N-Out Burger, a US fast food chain giant, does not have an outlet in Australia but occasionally runs very successful one-day only popup events across Australia, attracting long lines and hours of queuing from local foodies.
In-N-Out Burger sent a cease and desist letter to In-N-Out Aussie Burger, a Queensland-based business selling burgers and chips on home delivery services via UberEats, Menulog, and DoorDash. In-N-Out Burger requested for In-N-Out Aussie Burger to stop selling burgers, chips and beverages and using the any variations of names similar to In-N-Out branding and the replica of the In-N-Out logo on home delivery services.
The Respondents, Rich Asians Pty Ltd and Mr. Puneet Ahori, continued selling burgers, chips and beverages via home delivery services but changed the name and logo to “In & Out Aussie Burgers with arrows logo” (shown below) and also used “Over & Out Aussie Burgers”.
In July 2021, In-N-Out Burger filed a lawsuit against the Respondents seeking relief for:
1. trade mark infringement; and
2. passing off and misleading or deceptive conduct in contravention of the Australian Consumer Law.
The Respondents did not seek any legal representative for their defence.
Proceedings were resolved on 22 March 2022, where parties indicated that they had reached a settlement and the Respondents gave the Court and In-N-Out Burger the following undertaking:
- within 30 days cease using all variations of marks with Aussie burger and In-N-Out, In & Out, In and Out, in n out, Over-N-Out and Over N Out (thereafter “Aussie Burger Marks”), in relation to burgers and associated food and beverages or related restaurant and takeaway services;
- will not in future use the Aussie Burger Marks in relation to burgers and associated food and beverages or related restaurant and takeaway services;
- will not use In-N-Out Burger and any variations of the In-N-out Logo, or any mark that is substantially identical or deceptively similar to them in relations for the same goods and services;
- remove and deliver to In-N-Out Burger’s solicitors for disposal all goods, including advertising materials, business cards, printed and electronic matter, merchandise and equipment which has any of the Aussie Burger Marks;
- within 30 days cancel the business name registrations for “In-N-Out Aussie Burgers” and “In & Out Aussie burgers”, URL details including Instagram page, and removal of the Aussie Burger Marks from all delivery listings.
Despite giving the above undertaking, the Respondents failed to comply and fulfil any of the above undertaking.
Pursuant to rule 39.21 of the Federal court Rules 2011, an interlocutory application was held on 22 November 2022 and the Court gave an order requiring the Respondents to fulfil the above undertaking and to pay the costs of the interlocutory application.
This was not the first lawsuit where In-N-Out Burger was able to successfully force a business to change its name from a lawsuit. They won the lawsuit against a burger store in Sydney named Down N’ Out, that now trades as Nameless Bar (see post here: Burger battle down under continues for In-N-Out Burgers).
Take away messages
- In Australia, trade mark registration is based on a “Use it or lose it” policy. In-N-Out Burger launching a pop-up event every few years would meet the conditions for trade mark use while also providing commercial exclusivity owing to the one-day pop-up store. Because of these pop-up events and the overwhelming popularity of these one day events, they can claim that the In-N-Out branding has a “significant reputation and goodwill.” The point of these pop-up events is so that they can have exclusive trade mark right of their brand without having a physical outlet in Australia selling In-N-Out Burgers.
- What to do when receiving a cease & desist letter?
When receiving a potential infringing notice such as a cease and desist letter, it is wise to seek professional advice straight away. Like the Respondents, it is not wise to try to defend the case when they do not seem to know the technical details of infringement and passing off. A better outcome is likely when consulting a professional who deals with these matters daily.
If the Respondents had sought professional help earlier, they may have been able to have this settled privately and avoid going to Court entirely. They may have also benefitted from discussing possible options with professionals so that they could continue the business of selling burgers, chips and beverages by home delivery while making certain changes to the brand without infringing on another brand or closing their business. Ultimately, they will have saved a lot of money in the long run by engaging a professional to help.