It was a case of reap what you know rather than reap what you sow for Sanitarium as the NSW Full Court handed down a decision stating that the trademark “GRANOLA”, an invented word, was capable of being used as a descriptive word given that it had become understood as a descriptive term in Australia.  The proceedings arose when Sanitarium, an authorized user of the “GRANOLA” trade mark, accused Irrewarra Sourdough of trade mark infringement through their use of the word “GRANOLA” on one of their cereal products.  Oatlandish behavior indeed!

Sanitarium alleged that a rival cereal manufacturer’s use of the word GRANOLA on the front of a cereal packet amounted to trade mark infringement.  However, Sanitarium failed to establish that Irrewarra Sourdough’s use of the word GRANOLA in the sentence “all natural hand-made granola” was use as a trade mark, i.e., as a badge of origin.

Where an invented word has an ‘inherently suggestive’ meaning, it is capable of functioning other than as a badge of origin, even though it is an invented word.  Here, the word “GRANOLA” was inherently suggestive of a grain product, and in the context of the packaging, Justice Jagot found that it “would be obvious to the consumer that the ‘all natural handmade granola’ refers to the contents of the package which consists of grains, fruits and nuts apparently baked or toasted into clumps.”  The word “GRANOLA” appeared in Australian dictionaries, as well in menus, recipe books and on products, and this indicated that the term was capable of being a descriptive term in Australia.

Importantly, the trademark “GRANOLA” remains on the Trade Marks Register, with Sanitarium still being an authorized user.  Thus, Sanitarium still has enforcement rights over the “GRANOLA” mark and any future litigation will depend on how the term has been used.

The current proceedings illustrate the difficulty in establishing trademark infringement where trademarks consisting of an invented word take on a common descriptive meaning.  There are numerous examples of companies who have become victims of their own success by losing a trademark to common usage (think Aspirin).  However, there is no use crying over spilt milk for companies whose invented marks have started to pass into the common vernacular.  Companies can take positive action to prevent their invented marks from becoming generic descriptors, for example, through public relations measures which inform the public that use of the invented mark as a descriptor is incorrect.  This is precisely what Johnson & Johnson did to protect its famous “Band-Aid” brand in 2007.