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Things getting a bit Uggly

17 May 2021
There are around 296 registered trade Marks that include the word "Ugg" in Australia. In the land down under, the word UGG has become a generic term for those awesome boots we all cannot wait to put on as soon as winter arrives. As we know, generic terms are not eligible to be registered according to trade mark laws. You will not be permitted to own a registered Trade Mark for 'laptop' if you are a company that makes laptops (hence the reason Apple cleverly made up their own word for their products, 'Ipad' which is a registered Trade Mark). But here in Australia, an Ugg boot has become descriptive of the type of boot and therefore it cannot be a registered Trade Mark in respect to boots. It is interesting to note however that the word UGG is a registered trade mark in the USA and around 130 other countries by Deckers.

This is interesting because a word that is inherently descriptive in Australia or 'a generic' Australian term, is not considered descriptive or generic outside of Australia.

In many countries UGG boots is only able to used by one particular brand of footwear - Deckers -however in Australia Ugg Boots are a style of sheepskin boots made by many different companies, including UGG.

In the Appeals Court Leathers argued that under the doctrine of foreign equivalents Deckers should not have been able to trademark "Ugg" in the United states.  The United States trademark laws are governed by the Lanham Act, however unfortunately the Lanham act does not address the terms that are used generically in a foreign country. This is covered in the Trade mark manual of Examining Procedure 1210.10, which deals with the Doctrine of foreign Equivalents. Under the doctrine of foreign equivalent, words are translated into English to determine their geographical significance. This rule can only be applied to foreign language words and is not applied to words from an English-speaking country. The TMEP states that the doctrine can only be applied when it is likely that the ordinary American consumer would stop and translate the foreign word into its English equivalent; when it comes to a word that is from an English-speaking country it is unlikely that the purchaser would stop and analyse whether the word has any equivalent English meaning. Further the doctrine is not relevant because Americans recognise 'Ugg' as a brand name and not as a descriptive term.

The Australian based footwear company, Australian Leather, lost a US court appeal for trademark infringement. The trademark infringement case began in 2016 where US brand owned by Decker sued Mr Oygue for selling 13 pairs of 'Ugg' boots into the States.  The Australian company argue that the word 'Ugg' is a generic term that means sheepskin boots. However, Deckers argued that Americans knew 'Ugg' as a brand name and not a generic term and presented consumer survey as evidence. The court opined that even if the term is considered generic in Australia it cannot be concluded that it would be generic to the US consumers.
A Similar argument was presented by an American company Koolaburra which featured a documentary The Good, the Bad and The Ugg. Koolaburra argued that the term UGG was a generic term, but the court ruled in favour of Deckers. The owners then sold the brand to deckers which is now marketed as 'Koolabura by UGG'. In contrast, Deckers made a trade mark opposition against Ludda Production Pty Ltd for the mark UGG AUSTRALIA (& designs) and MADE BY UGG AUSTRALIA. IP Australia ruled on behalf of Ludda. Now you would find the marks by Deckers and Ludda existing as registered trademarks in Australia.

This case reflects how global access to products causes clashes in local legal systems. The Australian company owner Oygur stated that anyone could sell Ugg boots in Australia, and many Australian companies have trademarks that include the word UGG. "UGG Australia" was registered as a brand in the united states by an Australian entrepreneur Brian Smith. Deckers said that they had fairly bought the name from Mr. Smith. The mark has been held by Deckers in 130 Countries, having said that, this would mean that Australians companies that use the word UGG would be prevented from selling their boot internationally. In other words, if an Australian website ships internationally where Deckers owns a registered Trade Mark for the word UGG in relation to boots this is likely to constitute Trade Mark infringement under the local laws of the Country where the boots are purchased and Decker have made it clear that they take their intellectual property rights very seriously and will not hesitate to bring an action through the Courts.

Mr Oygue owes an exorbitant amount of alleged damages to Deckers and on top of that millions in legal fees, all as a result of selling 13 pair of boots into the USA.

Mr Oygue has stated he intends to appeal and keep fighting in the supreme court. He believes the decision adversely affects job opportunity for Australians if Ugg boots could be manufactured and traded both nationally and internationally. Mr. Xenophon says that a product that is quintessentially Australian cant be sold by Australian companies to any other part of the world because of Deckers trademark. Online opportunities open the global market for brands, but it also comes with risks. This is a classic example of a trademark infringement while trading online. The outcome of this case would be long lasting.

IP Partnership are here to protect your brand locally and internationally. The cost of a Trade Mark application is so nominal compared to the costs of litigating Trade Mark infringement. Please contact us today if you have a brand that needs local or international protection or alternatively we are here to assist you if you believe someone else is infringing your trade mark.

Janani Sundareswaran Iyer