Startup keeps its cool with IP protected
As a startup, deciding where and how you spend your limited dollars is one of many early crucial business decisions. Investing in marketing and branding was a given for Thomas deMasi, CEO of Coolsan®. But he admits that initially he wasn’t so convinced about investing in the company’s intellectual property.
The Coolsan® journey began in rural New South Wales in 2005. Dr Gary Erickson and his wife Merrill were running a restaurant and were constantly frustrated at the short shelf-life of their fresh herbs and vegetables. Spoilage of fresh foods is an annoying and expensive problem for the restaurant industry supply chain. Often fresh produce doesn’t show any signs of spoilage until the end of the chain, which leaves producers, suppliers or end-users bearing the costs.
Simple food-safe solutions
Drawing on his experience as a chemist, Gary developed a prototype system to decrease spoilage by delivering low levels of hydrogen peroxide into refrigerated spaces. In 2010, Gary and Merrill took their prototype system to a food and wine show in Sydney, where they met Thomas – an experienced food retailing and marketing consultant. Thomas immediately saw the potential of Gary’s prototype system.
Three years later, Gary and Thomas had founded their company Coolsan® and turned Gary’s prototype system into a marketable product. ChillSafe® is an environmentally-activated sachet that releases a low dose of a vapour to reduce the levels of bacteria, mould and ethylene that cause food to spoil.
“When we first started up, we generated a lot of interest in our product ChillSafe®, maybe too much too soon. Without revealing its secrets, I was showing it to a lot of people and then I realised it was at risk because it wasn’t protected,” said Thomas.
Although Gary had taken out an initial patent on his original system, ChillSafe® was a new and improved version and not all of its features were protected by the initial patent.
“ChillSafe® was now a unique marketable product and I realised my initial patent wasn’t enough to protect it,” said Gary.
Turning up the heat on the competition
Gary and Thomas met with Mark O’Donnell, a Patent Attorney at Madderns in Adelaide. It was the beginning of a partnership that would help Gary and Thomas make sense of a complex process, and make informed spending decisions about their intellectual property (IP).
“Mark helped me understand the importance, need and value of a patent to protect our interests,” said Thomas.
It did not take long for Thomas to work out they had made the right move.
“I had a major international food manufacturer with factories all over the world contact me. The head of their sanitation department told me he’d seen our product and asked his partners and global suppliers if they could copy it,” said Thomas.
“Two weeks later the advice from their guys was no we can’t copy it, it’s protected.”
The international food manufacturer is now trialling ChillSafe® at one of their sites.
“Now we have something of substance when we engage with global partners. When they ask if we’re protected we can say yes,” said Thomas.
Warming up to intellectual property
Mark has guided Coolsan® through every step of the patent application procedure, including advising on which countries to pursue patent applications to get the best value for money.
“As a startup, Coolsan’s® IP is their asset. Our job is to find the most cost-effective way to protect this asset,” said Mark.
Mark has worked in the IP field for more than 25 years. He has seen the patent process from all sides and believes that a well thought out IP strategy gives his clients a massive strategic advantage. The patent application process generally starts with filing a provisional patent application in Australia, which is effectively a stake in the ground that is recognised around the world. The next step is the filing of an international Patent Cooperation Treaty (PCT) application, which gives applicants the right to file in over 150 countries. The final step is the national phase where patent applications are filed in individual countries and some regions.
Coolsan® have now filed patent applications in 6 countries as well as Europe, and have signed a MoU with a major agribusiness supplier for use of ChillSafe® in the post-harvest industry in Australia and New Zealand. They are also in negotiations with a potential global partner with outlets in over 100 countries and have master distribution agreements with companies in Australia, the United Kingdom and South Africa.
“We have a novel, unique and multi-award winning product that has attracted a global audience. That is worth protecting,” said Thomas.
“If it wasn’t for Madderns’ support we wouldn’t have been able to get through the patent process.”
Get in touch with Mark at Mark.ODonnell@madderns.com.au.
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A recent Domain Name Decision highlights the importance, and benefit, of having a registered trade mark when seeking to challenge the registration of a .com.au domain name by a third party.
Administrative Panel Decision – Case No. DAU2016-0036
Mr Michael Arnold of Lorimax Pty Ltd (the Complainant) sought to challenge the registration by Tolling Customer Ombudsman Pty Ltd (the Respondent) of the domain name www.tollingcustomerombudsman.com.au (the Domain Name).
The Complainant, through his company, is contractually appointed by a number of entities, who operate toll roads in Australia, to provide a free complaints and alternative dispute resolution process for customers of such toll roads experiencing issues.
The Complainant submitted that it had provided such services since 2008 from the website www.tollingombudsman.com.au.
The Respondent was registered on 2 September 2016 and registered the Domain Name on the same day. The Domain Name resolves to a website where individuals can file a complaint, free of charge, with the toll road operator Transurban Limited.
The Complainant’s Trade Marks and the Complaint
On 12 September 2016 the Complainant filed Australian trade mark applications for the word mark “TOLLING CUSTOMER OMBUDSMAN” (No. 1795768) and for a composite trade mark featuring these words (No. 1795772) (the Complainant’s Trade Marks).
Shortly thereafter, on 19 September 2016, the Complainant filed a Complaint under the .au Dispute Resolution Policy (auDRP).
At the time the Decision was issued, the Complainant’s Trade Marks were awaiting examination and hence had neither been accepted nor rejected for registration.
To succeed in this Complaint under the auDRP, the Complainant was required to establish each of the following elements:
- the Domain Name was identical or confusingly similar to a name or a trade mark in which the Complainant has rights; and
- the Respondent had no rights or legitimate interests in respect of the Domain Name; and
- the Domain Name had been registered or subsequently used in bad faith by the Respondent.
The Panelist found that the act of filing the Complainant’s Trade Marks was not, of itself, sufficient to establish rights in the subject trade marks (as required to satisfy the first element).
The Panelist then considered whether the Complainant had established common law or unregistered rights in the Complainant’s Trade Marks, noting that to do so, the Complainant would need to show that through use, the Complainant’s Trade Marks had acquired a secondary meaning and become a distinctive identifier associated with the Complainant.
The Complainant had addressed the issue of unregistered trade mark rights by stating in the Complaint:
“The Complainant has invested a significant amount of time and resources to develop and promote the Trade Marks and Services under the Trade Marks. As a result of this extensive use, the Complainant has acquired a valuable and exclusive reputation and goodwill in the Trade Marks in Australia, in relation to the Services”.
The Panelist found that this statement was not sufficient to discharge the burden of establishing common law or unregistered rights in the Complainant’s Trade Marks.
In considering the question of common law rights, the Panelist noted that where the trade mark on which a complainant is relying is descriptive in nature, it can be difficult to show that the trade mark had acquired a secondary meaning and become a distinctive identifier of the complainant. In such cases, the Panelist noted that clear evidence will be required to support an assertion of common law rights.
The Panelist provided some guidance as to what might constitute clear evidence of an established secondary meaning, in finding that the Complainant had not provided any evidence of:
- the number of customer interactions provided by the Complainant under the Complainant’s Trade Marks; or
- advertising used to promote the Complainant which featured the Complainant’s Trade Marks; or
- surveys showing consumer recognition of the Complainant’s Trade Marks; or
- Media references to the Complainant’s Trade Marks
In summary, the Panelist found that there was no evidence filed by Complainant “that would suggest that a consumer would come to associate “Tolling Customer Ombudsman” with the Complainant”.
Accordingly, the Complaint was denied as the Complainant failed to establish the first element of the Complaint.
However, the Panelist did note that there may be grounds to consider a re-filed complaint in the event that the Complainant’s Trade Marks were to be registered (as has now occurred with the Complainant’s trade mark No. 1795772 “TOLLING CUSTOMER OMBUDSMAN” composite trade mark).
This decision under the auDRP is a pertinent reminder that without a relevant trade mark registration, it may be difficult (or at least costly) to succeed in challenging third party registration of .com.au domain names featuring your trade marks/brands.
This decision further confirms that assertions of common law rights in a trade mark in complaints filed under the auDRP should be supported by the filing of relevant evidence.
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