Two women, two teenage dreams, one trade mark.
In a long-running trade mark dispute, global pop star Katy Perry (real name Katheryn Hudson) has successfully overturned a 2023 Federal Court decision that previously favoured Australian fashion designer Katie Taylor, who had registered the trade mark KATIE PERRY for clothing in Australia.
The Full Federal Court ruled in favour of the Singer, ordering the cancellation of the Designer’s registered mark. Although the Designer had used her birth name in business since 2007 and registered the mark in 2008, the Court found that the Singer had acquired a substantial reputation in Australia by the time the legal action commenced in 2019.
Key issues included:
- The definition and scope of “clothes” in trade mark classes
- Whether using a stage name (like ‘Katy Perry’) qualifies for the good faith use of one’s own name defence
- Honest concurrent use and whether confusion or deception was likely due to the Singer’s growing reputation
The Court held that the Designer’s use of “KATIE PERRY” would likely cause confusion, particularly given the Singer’s fame and merchandise presence. It emphasised the need for businesses to conduct thorough trade mark due diligence before building a brand.
As Justice Markovic noted in the original decision: “This is a tale of two women, two teenage dreams and one name.”
The Detail
Global pop star Katheryn Hudson, better known by moniker ‘Katy Perry’ (“the Singer”), won her appeal to the Full Court of the Federal Court of Australia. The 2023 judgement that favoured Australian Designer Ms. Katie Jane Taylor (“the Designer”) has been overturned with the additional outcome that the Designer’s registered trade mark is to be cancelled.
If you are thinking of registering your trade mark in Australia without engaging a trade mark lawyer to conduct due diligence, you might want to reconsider your decision. This case is a cautionary reminder that you must do your homework before building your business around a brand. This involves more than just reading the arts & leisure section of the Sunday newspaper or doing a Google search for existing names.
Backdrop to the battle stage
- The Designer owns her own clothing label and has used her birth name to design and sell clothing under the brand ‘KATIE PERRY’ since 2007. The word mark was registered with IP Australia in Class 25: Clothes, with a priority date of 29 September 2008.
- The Singer has toured Australia on her world musical tours since 2009.
- With concerts in Australia scheduled as part of international musical tours, the Singer’s management team issued a cease-and-desist letter to the Designer to prevent registration of the KATIE PERRY mark in Australia.
- A co-existence agreement was proposed by the Singer’s lawyers, however, the Designer refused this mutually satisfactory offer to co-exist on the Register.
- The Singer applied to register KATY PERRY with IP Australia on 26 June 2009 in Classes 9, 41, and 25.
- The Singer’s team also lodged an application with IP Australia for an extension of time with a view to bring an opposition against the Designer’s mark KATIE PERRY being successfully registered.
- Ultimately, this opposition was withdrawn by the Singer. She also amended her own application to register KATY PERRY by removing Class 25 for clothes.
- In 2019 the Designer brought proceedings against the Singer for trade mark infringement in the Federal Court of Australia.
- The Singer filed a cross-claim against the Designer for the KATIE PERRY mark to be cancelled.
How far can we stretch ‘clothes’?
Briefly touching on what the Court decided about ‘constructing’ (i.e. interpreting) the scope of a class of goods/services that a mark is registered in respect of, we are reminded that the trade mark owner is responsible for clearly specifying what the goods and services are in a registration application. The Designer had only registered KATIE PERRY in respect of ‘Clothes’ in Class 25 but argued that this word’s meaning extended to headgear and footwear. Headgear and footwear merchandise was sold online and during the Singer’s concerts at popup stores. The Full Court held that here was no warrant to stretch the word ‘clothes’ in this case to include footwear or headgear, especially because the Designer could select headgear and footwear as options in her application.
Defences involving use in good faith of one’s own name & honest concurrent use.
The statutory defence found in section 122(1)(a) of the Trade Marks Act 1995 to infringement may be enlivened if a person uses in good faith their own name or the name of the person’s place of business.
The Full Court held that this defence may be relied on even when a person uses an adopted name, including a stage name, such as ‘Katy Perry’. Use of a person’s own legal name (or a company’s registered name) is not essential.
Looking at the “good faith” element of this defence, the Full Court agreed that adoption of the KATY PERRY mark five years prior to the Designer commencing her business demonstrated use in good faith. An important presumption the Court made is that the Singer’s beliefs were the same as those held by her talent manager, Steven Jensen, given the close working relationship they held. Jensen considered that there was a likely possibility that the Designer’s clothing would be confused with the Singer’s merchandise, and this could have potentially benefited the Designer from a financial perspective.
The Court also did not look unfavourably on the Singer’s decision to withdraw her opposition to the Designer’s trade mark application to register KATIE PERRY. The Singer’s talent manager was found to have held the objective of avoiding further negative media attention.
The Full Court held that the Singer could successfully rely on this defence.
Another defence the Singer attempted to rely on can be found in section 122(1)(fa) of the Trade Marks Act 1995 which requires that a person uses a substantially identical or deceptively similar mark and a court would hold that this person would obtain registration of this mark if they were to apply for it. The Singer’s lawyers argued that KATY PERRY would have been registrable pursuant to section 44(3) which, in a nutshell, empowers the Registrar to accept a trade mark application if there has been honest concurrent use of two marks.
The Court held that the Singer did demonstrate honest use, but it was not concurrent. This judgement reminds us that a finding of honesty is not defeated even where there is knowledge of the earlier mark, especially where there is no “taint” to the adoption of the trade mark and an honest belief that no confusion would likely arise. The Singer had honestly adopted her stage name in the US years before gaining knowledge of the KATIE PERRY mark and roughly five years before the Designer began her own clothing label.
Cancellation of the Mark
The strongest backlash for the Designer came in the form of the Full Court’s order to cancel her mark from the Register. The Trade Marks Act 1995 provides protection for well-known marks, regardless of whether they are registered, if there is a likelihood of deception or confusion because of existing reputation of the mark in Australia.
The Full Court held that KATIE PERRY should never have been registered because the Singer’s trade mark had acquired a reputation in Australia prior to the Designer’s trade mark application.
The Full Court’s decision to cancel the registration was on the basis that when the Singer’s cross-claim was filed in 2019, use of the Designer’s mark would likely cause deception or confusion. Since the Designer filed her trade mark application, the Singer’s reputation had grown significantly.
It would be an artificial separation to divide the reputation of Katy Perry, entertainer, and the reputation in KATY PERRY, the mark. Reference was made to other American musical artists such as Rihanna and Gwen Stefani who branch out into a wide variety of merchandising including perfumes and shoes – clothing being no exception.
This decision also addressed the contentious matter of the difference in spelling of ‘Katie’ versus ‘Katy’. Whilst some die-hard fans of the Singer might recognise the incorrect spelling, the ordinary consumer would likely be confused by an item of clothing bearing the mark KATIE PERRY and wonder if it was associated with the Singer.
KEY TAKEAWAYS
- Whilst the Full Court acknowledged the “blood, sweat and tears” that both women put into developing their businesses, you should be aware that Australian law prioritises avoiding confusion and deception for the public. Accordingly, ensure that you complete your own thorough due diligence.
- Trade marks used by globally renowned persons may acquire a reputation in the Australian market stronger than a small-scale business. Remember in this case, the Singer began touring Australia in 2009 – after the Designer began using the mark and filed for trade mark protection in Australia. The key issue the Court will look at is whether use of the registered trade mark will likely cause confusion or deception as a result of the stronger reputation in the trade mark that a third party is using.
- Whilst the detail of the co-existence agreement proposed by the Singer’s lawyers was not divulged, the Full Court disapproved of the Designer’s decision to reject the offer to co-exist with KATY PERRY. If you find yourself in a situation similar to the Designer’s, consider all reasonable offers for your mark to co-exist if the case happens to be that the third party is of stronger renown in Australia and has acquired a bigger reputation. At the end of the day, we remind you that the Court prioritises minimising confusion for members of the public.
Please contact Louise Wolf from MST Lawyers if you have an IP/Trademark matter you’d like help with.
