Ms Katheryn Hudson (US pop singer Katy Perry), and her associated companies, recently won an appeal in the Federal Circuit and Family Court of Australia (FCFC) in a long-running trade mark legal battle over the singer’s use of her stage name in the clothing industry.
On 22 November 2024, Justices Yates, Burley and Rofe in Killer Queen, LLC v Taylor [2024] FCAFC 149 unanimously overturned Taylor v Killer Queen, LLC (No 5) [2023] FCA 364 wherein Justice Markovic had found Ms Hudson and her companies liable for infringing the respondent’s class 25 trademark “Katie Perry”. Our previous article on Taylor v Killer Queen can be read here.
At the outset of her pop music career in 2002, Ms Hudson adopted the stage name “Katy Perry” and began performing under this name. From 24 September 2008, Ms Hudson’s associated companies began selling “Katy Perry” branded merchandise online.
A few days later, 29 September 2008 became the Priority Date for the class 25 trade mark “Katie Perry”. This was registered by Sydney fashion designer Ms Katie Taylor (born Katie Jane Perry) with respect to her clothing label (defined in the original case as the Katie Perry Mark and in the appeal as Ms Taylor’s Mark).
In 2009, Ms Hudson’s team became aware of Ms Taylor’s Mark and, concerned that Ms Taylor’s purpose was to obtain financial advantage, sent a cease-and-desist letter to Ms Taylor, in an attempt to stop the registration. Ms Hudson’s legal team then entered negotiations with Ms Taylor hoping to resolve the matter with a co-existence arrangement.
Ms Taylor rejected the offer of such an arrangement. Meanwhile, Ms Hudson and her companies continued to sell “Katy Perry” branded merchandise online and through pop-up stores during Ms Hudson’s 2014 and 2015 Prismatic Tour in Australia. These acts were later found to be infringements of Ms Taylor’s Mark in Taylor v Killer Queen.
The appellants challenged the primary judge’s rejection of their cross-claim to cancel Ms Taylor’s Mark pursuant to sections 60 and 88(2)(c) of the Trade Marks Act 1995 (Cth).
To succeed under section 60, the appellants had to establish:
To succeed under section 88(2), the appellants had to establish that because of the circumstances applying at the date of filing the cross-claim (20 December 2019), the use of Ms Taylor’s Mark by Ms Taylor was likely to deceive or cause confusion.
Justice Markovic’s decision was overturned by the FCFC in Killer Queen, LLC v Taylor due to the combined effect of four matters amounting to error.
The FCFC emphasised that a mere difference in opinion as to the result did not mean that appealable error is involved. However, in this case, the four matters led to the conclusion that the primary judge’s assessment was affected by error.
Firstly, the FCFC found the primary judge erred in “unduly” confining Ms Hudson’s reputation to entertainment and music and that the reputation in her stage name “Katy Perry” was of necessity a reputation in her name as a mark.
The primary judge in Taylor v Killer Queen stated at [742]:
In my opinion, clothes are not related to entertainment and music as the respondents contend. It may be that popular music stars such as Ms Hudson lend their names (and trade marks) to be used in connection with clothes and sell merchandise at their concerts but that does not make a reputation in one thing, i.e. entertainment and music, related to another, in this case clothes. As a matter of fact, at the time (of the Priority Date) Ms Hudson had not launched her clothing brand and the Katy Perry Mark had no reputation in clothing.
This narrow view of Ms Hudson’s “brand” was noted by the appeal judges in Killer Queen, LLC v Taylor at [291] as ignoring “the common practice of pop stars to sell merchandise including clothing at concerts and to launch their own clothing labels.”
This common practice of pop stars, in addition to Ms Hudson’s established reputation prior to the Priority Date, was the basis on which the appellants successfully argued members of the public might confuse Ms Taylor’s clothes with those of Ms Hudson, not the other way around.1
It was common ground between the parties that the Katy Perry Mark and Ms Taylor’s Mark were “deceptively similar” under section 10 of the Trade Marks Act. Both are two-word, word marks that are aurally identical and differing only by the “y” and “ie” in the first word.
The primary judge found this slight difference in spelling was “immediately apparent” and was compounded by the spelling of Ms Taylor’s Mark being “more conservative”.2
However, the FCFC found this approach of the primary judge exaggerated a slight difference between the two marks and that the marks were deceptively similar. The appeal judges at [294] noted:
… the ordinary consumer with an imperfect recollection of the Katy Perry Mark confronted with a garment with Ms Taylor’s Mark on it would be likely to be confused as to the source of the item and wonder whether it was associated with Ms Hudson.
The primary judge noted the lack of evidence of actual confusion between the marks since the Priority Date which she described as a “powerful factor”.
The FCFC found that undue weight was placed on this and that absence of evidence was not a decisive factor indicating confusion is not occurring in the market, citing the difficulty of producing evidence of consumers’ actual confusion.3
Instead, it was explicable in this case by the small scale of Ms Taylor’s business and Ms Taylor’s Mark not being widely used from the Priority Date to date.
The primary judge placed significance on how the Katy Perry Mark had been used by Ms Hudson following the Priority Date, with the Katy Perry Mark on clothes sold by the appellants being usually accompanied by graphics or photos of Ms Hudson.
The appeal judges found that usage of the Katy Perry Mark post the Priority Date was not relevant to the section 60 enquiry and that:
… the relevant comparison for considering whether use of Ms Taylor’s Mark is likely to deceive or cause confusion is between the reputation of the Katy Perry Mark, and a notional normal and fair use of Ms Taylor’s Mark.
That is, it was Ms Hudson’s well-established reputation and therefore the reputation acquired by the Katy Perry Mark, compared to Ms Taylor’s comparatively lesser known status as at the Priority Date, which needed to be considered.
Ms Taylor further submitted that even if section 60 was satisfied, the Court should refuse to cancel her mark based on the Court’s discretion under section 89 of the Trade Marks Act.
In this respect, the FCFC found that although Ms Taylor originally adopted her mark innocently, by the time she applied for her mark she had knowledge of Ms Hudson, her reputation, and her mark. Ms Taylor also accepted that at the time she filed her application, she knew it was likely that music artists sold clothing bearing their names at concerts and that celebrities often moved into merchandising.
In light of Ms Taylor’s knowledge, the FCFC found that this was sufficient not to enliven the discretion under section 89. They further held that the public interest considerations in preserving the integrity of the trade mark register meant that trade mark registrations should only be made in favour of applicants who are entitled to obtained them.
Pursuant to section 60 of the Trade Marks Act, the FCFC cancelled Ms Taylor’s Mark on the ground that the trade mark was liable to deceive or cause confusion, given the Katy Perry Mark had acquired a reputation in Australia before the Priority Date.
As Ms Taylor’s Trade Mark was not validly registered, the relief granted by the primary judge could not be sustained and was set aside. On that basis, the FCFC further found that the appropriate order for costs was that Ms Taylor pay the appellants’ costs of the appeal and cross-appeal.
At [322] the FCFC delivered the following harsh truth to Ms Taylor and indirect caution to others:
… in July 2009, Ms Hudson proposed a co-existence agreement with Ms Taylor that would have let both Ms Hudson and Ms Taylor continue to use their marks. Ms Taylor rejected that offer of a co-existence agreement, which as circumstances turned out, would have been an excellent outcome for both parties. The absence of any actual confusion over the many years of co-existence suggests that there has been no confusion on the part of consumers. However, having rejected the offer, Ms Taylor then chose to commence infringement proceedings against the appellants. In that sense, Ms Taylor has brought this result on herself. Unfortunately, it is no longer possible to return to the time of peaceful co-existence.
In response to the FCFC’s judgment, Ms Taylor said she felt let down by the Australian legal system, with the decision taking “a huge toll on me and my family.”4 The remaining legal avenue available to Ms Taylor now is to apply for special leave to appeal Killer Queen, LLC v Taylor to the High Court.
Notwithstanding the personal impacts flowing from a cancellation of a trade mark on the individuals or small businesses who own them, such as Ms Taylor, the public interest considerations underpinning trade mark law cannot be overlooked.
Protecting consumers from being confused or deceived was the driving factor that decided the cancellation of Ms Taylor’s Mark. Any person or business considering applying for a trade mark needs to give careful consideration as to whether it is similar to a pre-existing mark of established reputation.
This example illustrates the importance of seeking advice early to secure all trade marks for your brand or event.
The Litigation and Dispute Resolution team at Lavan has extensive experience in respect of trade mark registrations. If you require advice in this area, please contact Iain Freeman to discuss the matter.
Thank you to Freya Surma-Litchfield, Solicitor, for her valuable research and assistance with this article.
