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The “Rusty Krab” Tries to Sidestep Trademark Infringement

The parent company of Nickelodeon, Viacom, has sued a bar in Houston for trademark infringement. The bar, called the “Rusty Krab”, features an under the sea theme and is actively marketed towards fans of Spongebob Squarepants. It’s alleged that the sly references to Spongebob Squarepants characters and phrases have been used by the pop-up bar to capitalise on unsuspecting fans of the show.

In our view, the claim is likely to succeed as the bar is clearly playing on the reputation of Spongebob Squarepants and is visibly similar to its name and overall appearance. However, we recognise that trademark proceedings can be expensive and there are a number of options which may lead to the same result.  Some of the options and steps include:

  1. Oppose Trademarks

Registration entitles the owner of a trademark to obtain relief if the trademark has been infringed.

The registration process and register are monitored and maintained by an entity called IP Australia. IP Australia will reject an application which is “substantially identical with, or deceptively similar” to an already registered trademark, except under certain exceptions.

Another business will be found to be using a trademark which is “deceptively similar”, if the trademark is similar enough that it would be likely to deceive or cause confusion in a customer as to the origin of the good or service. If you are receiving enquiries from customers referring to you as another business and asking whether you are associated with it, this is clear evidence that other business may be infringing your trademark and causing confusion amongst your customers. We find this happens all the time!

To stop this from happening, you can oppose trademarks prior to or after registration. This will stop them from being registered and may prompt the other business to rebrand.

  1. Cease and Desist

If a business is using a trademark which you believe infringes yours, send a letter of demand. This will demand that they immediately cease and desist from using the trademark. In our experience, this is a very useful tool and often results in the other business rebranding. You can even receive an account of profits for money received whilst they were using the trademark.

This option is best suited to people who have a registered trademark already, so if you haven’t applied to register your trademarks, you should!

  1. Consider The Big Picture

If you do not have a registered trademark, don’t worry – all hope is not lost. There are laws which still protect you – under the law protecting consumers from misleading and deceptive conduct and protecting your business from what’s known as “passing off”. These claims include where a business is using similar colours, branding, names and styles to your business.

Although these are less straightforward and cost effective than trademark infringement or trademark opposition, they are still powerful.

If you need assistance with trademark registration or infringement, contact an experienced commercial law team member at Taurus Legal Management today on (03) 9481 2000 or info@tauruslawyers.com.au.

Posted by Taurus Legal Management