In Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2021] FCAFC 163, the Federal Court of Australia (Full Court) held that the use of PROTOX and “instant Botox® alternative” infringed the registered BOTOX mark under s 120 of the Trade Marks Act 1995 (Cth)(“TMA”). The finding arose from the close resemblance of the impugned marks to BOTOX mark such that it would cause consumers to wonder if the competing products emanate from the same trade source. The summary of the decision at first instance can be found here.

Federal Court of Australia, Full Court

Judges: JAGOT, LEE AND THAWLEY JJ

Date of Judgment: 7 September 2021

Appeal from: 
Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2020] FCA 1530
Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd (No 2) [2021] FCA 185

Allergan Inc (“Allergan”), producer of well-known injectable cosmetic products containing botulinum toxin known as Botox type A and owner of numerous BOTOX trade marks including defensive mark 1578426 (“BOTOX Mark”). The BOTOX Mark was registered in various classes including anti-ageing creams and anti-wrinkle cream in class 3. 

Self Care IP Holdings Pty Ltd and Self Care Corporation Pty Ltd (collectively known as “Self Care“) produces application based cosmetic products which are applied externally. 

Background

Allergan initiated infringement proceedings against Self Care for the use of PROTOX mark, the use of “instant Botox® alternative“(impugned marks) under s 120 of the TMA and sought relief against the use of the impugned marks by relying its registered BOTOX marks in Australia. Allergan alleged Self Care engaged in misleading and deceptive conduct that contravened ACL with the use of its efficacy representations in promotion of products. 

The primary judge dismissed claims of infringement for PROTOX and “instant Botox® alternative” and as well as substantially claims of misleading and deceptive conduct. Only one out of thirty-five statements in contention was found to have contravened the ACL. 

Full Court Decision

Allergan appealed on the basis that the primary judge had erred in principle and advanced seven grounds of appeal. The first three grounds concerned the primary judge’s application of principle in assessing the deceptive similarity of the PROTOX mark. The primary judge found the use of PROTOX was use as a trade mark but held PROTOX would not be confused with BOTOX. Consumers would be reminded of BOTOX instead. There was no likelihood of direct confusion as a result of mistaking PROTOX with BOTOX.

The Full Court agreed with the primary judge on the issue of direct confusion but took the view the primary judge erred in failing to address if the factors in Southern Cross would have mitigated the risk of indirect confusion. Taking into account the close resemblance between PROTOX and BOTOX, the Full Court took the view that there’s real and tangible risk that consumers might wonder if they were from the same source. The Full Court upheld Allergan’s claim that PROTOX and BOTOX were deceptively similar. 

Allergan challenged the primary judge’s findings concerning “instant Botox® alternative”, claiming the primary judge had erred by not finding its use as a trade mark and consequently infringing the BOTOX mark under s 120 of the TMA due its deceptive similarity with the BOTOX mark under grounds 4 and 5. The Full Court took the view that the placement and use of the “instant Botox® alternative” in the INHIBOX packaging as well as on its website constituted use as a trade mark.

The primary judge applied the principle in Yeast Yeast Vite^[1] case and held the use of “instant Botox® alternative” by Self Care were descriptive labels for products and served to differentiate its products from those of Allergan’s. The Full Court found the primary judge was incorrect to infer that the differentiation meant the risk of source confusion would be mitigated.

“Alternative” need not necessarily dispel the risk of indirect confusion such that it would not cause consumers to wonder if the competing products come from the same source. Their Honours reasoned that an application based “alternative” could have been introduced into the market by Allergan for consumers who wanted to avoid cosmetic treatments involving injections.

In light of the High Court decision in Mark Foy’s Ltd v Davies Coop & Co Ltd^[2], the Full Court found use of “instant Botox® alternative” fell within the ambit of use as a trade mark, together with INHIBOX and freezeframe marks. The words “instant” and “alternative” were both descriptive elements and the dominant cue in “instant Botox® alternative” was “Botox”. The Full Court accordingly upheld Allergan’s claim that “instant Botox® alternative” infringed the BOTOX mark.

The last area of contention concerned the efficacy representations made by Self Care on their products in relation to “instant Botox® alternative”. Allergan contended primary judge should have found Self Care did not have reasonable grounds for making representations that INHIBOX was of the same quality and standard as Botox, capable of achieving a similar outcome to Botox injections in terms of the longevity of its effects with respect to the reduction of appearance of wrinkles. 

There was no dispute that the application of the inhibox reduces wrinkles quickly enough to have a similar effect in reducing the appearance of wrinkles to be described as “instant”.

The Full Court then considered how reasonable consumers would have understood “instant Botox® alternative” and inferred that consumers would have thought (a) the use of inhibox would reduce the appearance of wrinkles similar to the effect achieved by Botox; and (b) that effect would last, after treatment, for a period equivalent to that which would be achieved by Botox treatment. The Full Court did not find evidence to support (b) i.e. “longevity” of effects of inhibox to be similar to the treatment of Botox. The Full Court upheld Allergan’s claim that the representation by Self Care contravened ss 18 and 29(1)(a) and (g) of the ACL. 

Self Care Defence

Self Care sought defence under s 122 of the TMA against infringements found. In particular, Self Care tried to invoke the provisions of s 122(1)(d) that the use of “instant BOTOX® alternative” was for the purpose of comparative advertising.

The Full Court reasoned that “instant BOTOX® alternative” was chosen to leverage off the reputation of Botox and not to promote Inhibox comparatively with Botox and was not used in good faith. The defence under ss 122(1)(b) and 122(1)(d) were not established.

The defence under s 122(1)(e) did not apply as the registered mark was “freezeframe PROTOX” and that did not provide a defence for PROTOX which was the impugned mark in this case. 

Commentary and Analysis 

Significantly, the finding that there was a real and tangible risk that consumers would wonder if the competing products were from the same source was crucial in the Full Court arriving at the findings of deceptive similarities between the impugned marks (PROTOX and “instant Botox® alternative”) and BOTOX.

Contrary to the intended purpose by Self Care, the Full Court found use of “instant Botox® alternative” use as a trade mark. It was also determined that Self Care could not rely on “comparative advertising” as a defence to trade mark infringement. These decisions had far reaching consequences and could impact comparative advertising strategies in Australia.

*As of 7 October 2021, Self Care has applied for special leave to appeal to the High Court of Australia.

^[1] Irving’s Yeast-Vite Ltd v Horsenail (1934) 51 RPC 110

^[2] [1956] HCA 51; (1956) 95 CLR 190

Disclaimer: The above is provided to assist in the understanding of the decision by the Federal Court of Australia (Full Court). It should not be relied upon as legal advice. Any errors or omissions are the author’s. For queries related to the article, please contact the author here.