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Go Fish! Tackle-ing IP Ownership

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The recent Federal Court decision to refuse an application for interlocutory injunction again highlights the importance of clarifying intellectual property ownership and use rights. If a party does not have the rights asserted, questions will be raised on its ability to bring intellectual property infringement proceedings.

The business “Pakula Tackle” was established in 1987 by Mr Peter Pakula and specialised in the design, manufacture, distribution and sale of (game) fishing lures, including Pakula fishing lures.

Following several changes in ownership of the business, in 2004 Pakula Tackle Australia Pty Ltd (Pakula Tackle Co.) became the owner of the business. In 2007, the business assets of Pakula Tackle Co. were sold to Gamefish Central Pty Ltd (Gamesfish), of which Mr Pakula was a Director.

The business assets of Pakula Tackle Co. included “intellectual and industrial property” such as the registered trade marks for “PAKULA LURE AUSTRALIA” (illustrated), “WITCHDOCTOR”, “SOFTEASE”, “HOTHEAD”, “LUMO” and “COCKROACH” (together the “Pakula Trade Marks”), as well as copyright works in its website (Pakula Copyright). Although Pakula Tackle Co. had sold its business assets to Gamefish, through an unknown arrangement, Pakula Tackle Co. continued to carry on the business “Pakula Tackle” – including through the use of the Pakula Trade Marks and Pakula Copyright.

Since 1999, Mr Mario Zacaropoulos had been involved in the “Pakula Tackle” business. At the time the business assets of “Pakula Tackle” were sold to Gamefish, Mr Pakula and Mr Zacaropoulos apparently came to a disputed understanding whereby Mr Zacaropoulos was able to continue to manufacture and sell Pakula fishing lures, eventually through the company Zacatak Lures Australia Pty Ltd (Zacatak). As part of its business, Zacatak used certain trade marks including “ZACATAK LURES AUSTRALIA” (illustrated), “Doctor” and “Roach” in relation to similar products.

When the arrangement between Mr Pakula and Mr Zacaropoulos ultimately deteriorated, Pakula Tackle Co. sought an interlocutory injunction claiming, amongst other things, alleged infringement of the Pakula Trade Marks and Pakula Copyright by Zacatak, Mr Zacaropoulos and his wife Mrs Jackie Zacarapoulos.

Pakula Tackle Co. claimed that it was the owner of the Pakula Trade Marks even though the evidence showed Gamefish to be the registered owner. While Mr Pakula deposed that Gamefish had consented to Pakula Tackle Co. “bringing any action or seeking to enforce its rights associated with registration of the trade marks” – and being an authorised user of the trade marks – Justice Logan noted that the “evidence led on its behalf to date … is noteworthy for its vague generality”.

In reviewing the allegation of trade mark infringement, Logan J:

  1. was not persuaded that Zacatak had infringed the “PAKULA LURE AUSTRALIA”, “WITCHDOCTOR” or “COCKROACH” trade marks
  2. commented that Zacatak had used the word “Lumo” on its website in at least three instances, and Gamefish “may well have cause for concern about these uses on or in respect of products”. However, Gamefish was not the applicant for the injunction, and “Zacatak must meet the case as pleaded”.

In relation to the Pakula Copyright, his Honour noted that there was a “serious question to be tried in respect of infringement of such copyright rights”. However, he raised questions over the ability of Pakula Tackle Co. to bring copyright infringement proceedings. His Honour noted that any copyrights Pakula Tackle Co. had previously enjoyed passed to Gamefish on sale of the business. No written agreements evidenced the transfer of this copyright back to Pakula Tackle Co., nor clearly showed Pakula Tackle Co.’s right to litigate the infringement of copyright on the behalf of Gamefish.

After assessing all the factors pleaded, including the claims of trade mark and copyright infringement, his Honour did not grant the interlocutory injunction sought. Clarification of Pakula Tackle Co.’s claims of ownership and right to use the Pakula Trade Marks and the Pakula Copyright will be an issue for trial.

This interlocutory injunction decision highlights the importance of written agreements confirming:

  1. ownership of intellectual property
  2. rights to use intellectual property
  3. rights to litigate in respect of intellectual property infringement by third parties and
  4. the importance of clarifying all these rights when selling and buying a business

Our Intellectual Property lawyers can assist you to confirm ownership of your intellectual property to avoid any disputes at a later date.

Author: Noelene Treloar