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Drink manufacturers’ legal fight under way

COTTEES brand’s Australian owner Cadbury-Schweppes has initiated legal action against O’Connor-based Anchor Foods amid claims of design and trademark  infringement.

The move follows a similar court action in 2001 by Red Bull, which successfully sued its former distributor, Livewire, for copying, or “passing off” its product design.

Cadbury-Schweppes claims Anchor Foods, which has operated for 150 years, infringed upon its ‘Cottees Lime Coola’ design and trademark registrations.

The claim centres on Anchor Foods’ recent launch of its lime cordial as ‘Koola Lime’ in a new ‘jug’ style bottle. 

Cadbury-Schweppes is seeking a court order for the removal of Anchor Foods’ lime cordial in the new bottle from supermarket shelves, which would cost Anchor Foods several hundred thousand dollars.

Anchor Foods managing director David Clapin rejects Cadbury-Schweppes’ claims and maintains his company’s design is original.

“This brilliant and totally original Anchor [jug] design was created from a blank sheet by an exceptionally talented team of young Western Australian marketers, designers and engineers,” Mr Clapin said.

But Jackson McDonald Partner Stephanie Faulkner said independent design alone would not necessarily save companies from liability.

She said it was widely recognised that design infringement litigation was difficult to win and that the Designs Act needed updating.

“Nevertheless, the courts have become quite inventive in finding remedies for claimants under the law of passing off and misleading and deceptive conduct,” Ms Faulkner said.

As to the trademark infringement, Mr Clapin, who was instrumental behind the recent purchase of the business from Goodman Fielder, said his company has been using the word ‘Koola’ for nearly two decades.

“We cannot understand why legal action is being taken at this time to have our product removed from the market after so many years,” he said. 

“Anchor Foods has continuously used the term ‘Koola’ for almost 20 years, well before Cadbury-Schweppes registered the ‘Coola’ trademark.”

Ms Faulkner told WA Business News that, even though Anchor Foods have used the word ‘Koola’ for 20 years without any previous allegation of trademark infringement, the real contest was between ‘Lime-Coola’ and ‘Koola Lime’. 

“It will be interesting to see how the court deals with this juxtaposition and whether the Red Bull case will have any influence on the final outcome,” Ms Faulkner said.

In that case, the Federal Court decided that ‘passing off’ had occurred even though the trademarks for each company’s products were different and the packaging and labelling were not identical. The similarity in the “get up” of the packaging and labelling was enough for Red Bull to succeed in its action.

Cadbury-Schweppes is seeking damages and, in documents lodged with the Federal Court in Melbourne, claims to have spent more than $1.17 million in promoting and advertising goods bearing the ‘Coola’ name since 1994.

It said sales of ‘Coola’ products totalled $76 million in the past decade.

Mr Clapin said Anchor had attracted the attention of its competitors after a campaign to overhaul the company – including relaunching and repackaging more than 200 product lines – began last year.

Ms Faulkner said a bill introduced to Federal Parliament last December aimed to strengthen the law of design and encourage greater use of it. However, she said the bill had been referred to a parliamentary committee, which was yet to finalise its report.

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