When starting a new business, of the many factors you must consider such as your niche, stockists, whether to go virtual or a mortar and bricks store etc, is your branding. It’s one of the most important decisions regarding a company’s image and is visually what will set you apart from your competitors. However, it is crucial that when deciding upon logos, colour palettes and imaging, your brand doesn’t infringe upon another that is trading.
Recently, Chemist Warehouse, a discount pharmacy outlet, claimed Direct Chemist outlet, which is also a discount chemist, was using misleading or deceptive conduct in its branding due to Direct Chemist Outlet’s get-up and colour scheme being substantially identical or deceptively similar to Chemist Warehouse’s own storefront imaging.
The Full Federal Court unanimously dismissed Chemist Warehouse’s appeal on the basis that there was:
Insufficient uniformity: There was not enough uniformity in Chemist Warehouse’s visual branding devices to support a claim for misleading or deceptive conduct.
Differences: There were relevant differences between the storefronts of the two businesses. Direct Chemist Outlet storefronts used “lifestyle” photographs and a distinctive red half sunburst logo, and had a “cleaner” appearance.
Functional colours: Chemist Warehouse used the primary colour palette generally consistently but it was not a sufficiently distinctive element of the get-up. The colour yellow had a functional purpose.
Copying: Direct Chemist Outlet copied elements of Chemist Warehouse’ get-up. This included a similar primary colour palette, and a strikingly similar slogan referring to “Australia’s Cheapest Chemist”. However, it did not intend to mislead or deceive consumers or pass off its stores. It aimed to establish its own rival discount chemist brand. Direct Chemist Outlet had sufficiently distinguished itself by its own logo, signage and different get-up despite the deliberate copying.
The primary colour palette used by Chemist Warehouse was not distinctive. There was considerable variability in Chemist Warehouse’s get-up. The yellow, blue and red colour combination had a functional purpose to draw attention, and the colour yellow conveyed discount value. Even if a colour-based reputation could have been shown, Direct Chemist Outlet had sufficiently distinguished its pharmacies so as not to mislead consumers. Its stores used a distinctive sunburst logo, cleaner appearance and lifestyle photographs.
Chemist Warehouse had also sued for trade mark infringement, however this application was dismissed, and Chemist Warehouse did not appeal on this issue.
The easiest and most cost effective way of ensuring you don’t end up in this position, is by seeking legal advice on Trademarks and branding to mitigate the potential of infringing upon another companies logo and imaging. Contact Tyler & Co today and speak to one of our lawyers about your plans, so you can confidently build your business and brand, without the worry.