Insights / May 9th, 2019

Dodgy drop - Penfolds tastes success

Many of our clients and colleagues know we have substantial involvement in the wine industry, including the occasional product sampling. We are therefore pleased to note that Treasury Wine Estates ("TWE"), owner of the world-famous Penfolds brand has had success in obtaining court orders against what looks to be a dodgy trade mark infringer.

Australia Rush Rich Winery Pty Ltd, a one-man band with paid up capital of $100, apparently thought it was a good idea to put cheap wine into bottles, include on the labels Penfolds English language and Chinese character trade marks and sell the wine, especially in China. An associate company, Eastern Tomorrow (Jinjiang) Import & Export Co., Ltd thought it was a good idea to apply to register in Australia, Chinese character trade marks that infringed Penfolds’ Chinese character trade marks.

The Federal Court of Australia has ordered summary judgment in favour of TWE’s subsidiary, Southcorp Brands in the sum of $352k and $23k in interest plus legal costs. The court also ordered Eastern Tomorrow (Jinjiang) to withdraw its trade mark applications. The court injuncted the Rush Rich parties from using Penfolds Chinese character trade marks or other trade marks substantially identical with or deceptively similar to those Chinese character trade marks, the Penfolds trade mark or Southcorp’s Ben Fu trade mark in relation to wine. The Penfolds Ben Fu trade mark means “chasing prosperity”. One might think that “Rush Rich” was intended to have a deceptively similar meaning.

TWE had also brought an unfair competition claim against Rush Rich in China. Rush Rich had claimed that it was “the largest and most famous winery in Australia” and “the symbol of Australian wine”. It was no surprise then that the week before the Federal Court judgment, the Shanghai Pudong Court found those statements to be false and misleading. The court ordered Rush Rich to pay $426k in compensation to TWE. The court also ordered Rush Rich to publish an apology on its WeChat account and in the China Wine magazine.

It is good that TWE has had success, especially in China, given its battle against counterfeiters and dodgy trade mark registrations in the past. We wonder how TWE will fare in getting Rush Rich to pay the $800,000 in judgments and costs.