Registering a trade mark may seem simple enough, but for those contemplating the process, the recent Federal Court decision of Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd should be considered a warning. The case emphasises the importance of ensuring registration applications are correctly completed the first time round, particularly when trying to determine and name the proper owner of the trade mark in the application.

Key points of the case

  • Mr Pham applied for registration of ownership of a trade mark using his own name.
  • Mr Pham was the sole director of Pham Global Pty Ltd.
  • Mr Pham (in his personal capacity) was not the owner of the trade mark. Rather, the Court found that the trade mark was designed for and used by the company, and not by Mr Pham.
  • Assignment of ownership of the trade mark from Mr Pham to the company could not cure the deficiency in the application.
  • The application for registration of ownership was invalid from the outset.

Don’t be led down the garden path by structuring advisors

Often lawyers and accountants recommend trade mark ownership structures to clients on the basis of what will be most beneficial from a tax, financial or risk management standpoint. While these are of course legitimate concerns, these structures often fail to appreciate the concept of ownership, use and authorised use in respect of the Trade Marks Act 1995. ‘Ownership’ in respect of intellectual property and ‘ownership’ in respect of real property are two very distinct beasts. Yet, when it comes to structuring your finances, people may be inclined to treat the two similarly. For this reason, it is of the utmost importance that you seek specialised IP advice when applying for registration. The decision in Pham demonstrates the court’s unwillingness to give regard to peripheral tax or financial reasons as to why a certain person or entity was named as the owner of a trade mark on the application for registration. The requirements of the Trade Marks Act 1995 will be strictly applied, and as such, a clear understanding of the law in respect of trade mark ownership is necessary.

Getting it right the first time

The crucial message from Pham is the importance of naming the correct owner of a trade mark on the initial application for registration. The process should be thought of as “registration of ownership not ownership by registration” (PB Foods v Malanda Dairyfoods Ltd). The distinction may seem superficial, but a failure to appreciate the concept of ownership and the incorrect naming of the owner could ultimately lead to the invalidation of your trade mark’s registration.

Confusing registration and ownership

Pham demonstrates the importance of not using the terms ‘registration’ and ‘ownership’ interchangeably. Someone can certainly own a trade mark before registration occurs, and registration of a trade mark does not necessarily equate to ownership.

Who is a registerable owner?

Per section 27 of the Trade Marks Act 1995 (Cth) mark:

  1. A person may apply for the registration of a trade mark in respect of goods and/or services if:
  • the person claims to be the owner of the trade mark; and
  • one of the following applies:
    • the person is using or intends to use the trade mark in relation to the goods and/or services;
    • the person has authorised or intends to authorise another person to use the trade mark in relation to the goods and/or services;
    • the person intends to assign the trade mark to a body corporate that is about to be constituted with a view to the use by the body corporate of the trade mark in relation to the goods and/or services.

Pham emphasises how crucial the claim to ownership, outlined in sub section (a) is. Ownership of a trade mark will be dealt with strictly. The person or entity named on an application form must firstly be an owner, and secondly satisfy one of the elements of sub section (b). Additionally, doctrines relating to the separate legal personality of individuals and the companies they hold directorships of will be strictly applied.

Key Message from Pham

The key message from Pham is the need to properly understand the concept of ownership and use in respect of the Trade Marks Act 1995 before applying for registration of your trade mark. These can be complex legal issues, and the Courts are adopting a much stricter approach. For this reason, seeking IP advice before applying for registration of a trade mark would be the sensible approach.