February 19, 2019

New Zealand Case Law update for 2018

The following IP case law during 2018 illustrates the principles of New Zealand IP law in practice.
Red Bull GmbH and Bullsone Co Limited

This decision from IPONZ confirmed that very well-known reputation associated with one type of core goods can be used to stop registration of a similar mark for very different goods.

Red Bull, which owns registrations for    and  that cover energy drinks, successfully opposed Bullsone, which tried to apply for  that covered motor vehicle-related goods.

Red Bull opposed the application on two grounds:

  • Use of Bullsone’s mark would be likely to deceive or confuse consumers.
  • Bullsone’s mark was similar to Red Bull’s well known marks.  As such, use of the Bullsone mark would be taken as indicating a connection in the course of trade with Red Bull and would be likely to prejudice the interests of Red Bull.

Red Bull was able to establish that its marks were well known in New Zealand and provided strong evidence that its marks were extensively used in relation to motor sports.

Resmed and Fisher & Paykel Healthcare

This is currently the biggest patent litigation in New Zealand history. Resmed and Fisher & Paykel Healthcare are suing each other over patents protecting masks used for obstructive sleep apnea therapy. Proceedings are still ongoing but decisions are expected later this year.

Sky and TVNZ, MediaWorks and NZME

The satellite TV company Sky is suing Television New Zealand (TVNZ), MediaWorks Limited, Fairfax Limited and New Zealand Media and Entertainment Limited (NZME) over fair dealing usage of its exclusive 2016 Olympics content. Sky alleged that the defendants reproduced too much content in their news reports of the Olympics in breach of fair dealing arrangements. Sky has settled with MediaWorks and Fairfax, while proceedings against TVNZ and NZME are ongoing.

Kim Dotcom and USA

Kim Dotcom is the creator of the now-defunct file sharing website Megaupload. He has been wanted for extradition by the United States since 2012 for criminal copyright infringement as a result of Megaupload’s file sharing activities. Dotcom has been battling through the courts and most recently lost at the Court of Appeal in July 2018. The proceeding is ongoing as Dotcom is appealing to the Supreme Court.

Eminem and New Zealand National Party

US rapper Eminem sued the New Zealand National Party for copyright infringement of his well-known song ‘Lose Yourself’. The National Party had used a very similar song in an election campaign advertisement in 2014. The High Court ruled in favour of Eminem but the National Party has appealed to the Court of Appeal.

As well as setting out the New Zealand position on the issue of copying music, the High Court clarified the principles for determining the amount of damages that is awardable to the successful party for copyright infringement:

  • The hypothetical bargain – damages are assessed on the basis of what would have reasonably been charged at the time of the infringement had the defendant acted lawfully and obtained permission.
  • Compensatory and restitutionary damages – the user principle is not strictly compensatory in nature, but it recognises that the defendant has invaded the plaintiff’s intellectual property rights.
  • Willing parties – it is irrelevant that the parties would have agreed to a deal, the Court assumes that they would have been willing licensor and licensee with their respective strengths and weaknesses.
  • Extent of copying – the hypothetical licence would be for what the defendant actually used, including the extent of copying and its relationship with the copyrighted work.
  • Lack of quality control – it can be taken into account that the licensor did not have the opportunity to include terms related to quality control.
  • Evidence is a guide only – the plaintiff should provide evidence which will guide the Court on the reasonable charge for a license, however that evidence is a guide only.
  • Caution with comparable licenses – while comparable licences and rates of royalties may assist the Court in making an assessment of quantum, the Court must consider these comparisons with caution.
  • Settlement agreements are irrelevant – this is because they are designed to prevent litigation, rather than actually fixing a royalty rate.
  • Level of compensation – the Court considered it unhelpful to consider if there should be an erring on the side of over or undercompensating the plaintiff, instead stating that the focus must be on striking a reasonable fee for the hypothetical license.

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