Fast Food Giant’s Trademark Clash: Court Verdict

What is a Trademark? 

A trademark provides legal protection for your brand, aiding customers in distinguishing your products or services in the market. Trademarks can be used to protect a logo, phrase, word, letter, colour, sound, smell, picture, movement, aspect of packaging, or any mixture of these.

 

Background: What was McDonald’s Claim against Hungry Jacks? 

In this case, McDonald’s made two claims: a trademark infringement claim and misleading and deceptive conduct claim. 

Trademark Infringement Claim:

As widely recognised, McDonald’s is renowned for its Big Mac burgers, a brand protected by trademark to prevent competitors from adopting identical branding for their burgers. On 22 June 2020, Hungry Jacks introduced the ‘Big Jack’ and ‘Mega Jack’. This led McDonald’s to initiate legal action in the Federal Court in September 2020. The lawsuit alleged that Hungry Jack’s ‘Big Jack’ and ‘Mega Jack’ burgers constituted an infringement on McDonald’s Big Mac trademark.

The ‘Big Mac’ trademark relates solely to the name of the burgers, not their visual presentation. Therefore, the claim focused on assessing the deceptive similarity between the terms ‘Big Jack’ and ‘Mega Jack’ in comparison to ‘Big Mac’ and ‘Mega Mac’. McDonald’s pursued a court order mandating that Hungry Jack’s must eliminate all advertising materials featuring the Big Jack and Mega Jack names and sought compensation for damages and costs. 

Misleading or Deceptive Conduct Claim:

Following the initiation of the lawsuit, Hungry Jack’s launched an advertising campaign asserting that the Big Jack exceeded the size of the Big Mac by 25%. Consequently, McDonald’s introduced an additional claim based on allegations of misleading or deceptive conduct. 

 

What did the Court Assess when Coming to a Decision? 

In assessing McDonald’s trademark claim, the court applied the recent High Court decision of Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd (2023) 408 ALR 195 to determine that any reputation McDonald’s had accrued in its ‘Big Mac’ and ‘Mega Mac’ trademarks could not be considered for the purposes of assessing deceptive similarity.  

The Court held that the correct approach was to assess the likelihood of consumer confusion from the perspective of a notional buyer, without any knowledge of either fast-food chain’s reputation. Additionally, the Court noted that the word ‘Big’ is commonly used by businesses when marketing their goods.  

In determining the misleading or deception claim, the court turned to Australian Consumer Law. From this, sought to determine whether the claim that the Big Jack burger was 25% bigger than the Big Mac burger was accurate and truthful. 

 

What was the Court’s Final Decision? 

The Court determined that ‘Big Jack’ and ‘Mega Jack’ do not exhibit confusing similarity to ‘Big Mac’ or ‘Mega Mac’, and thus, do not violate the trademarks associated with these names.

However, Hungry Jack’s didn’t come out completely unscathed. The Court did find Hungry Jacks guilty of misleading or deceptive conduct under the ACL. The evidence demonstrated that Big Jack patties did not meet the 25% larger size claim compared to Big Mac patties. The penalty for this conduct will be established in a separate liability hearing.

 

Why is this important to your Business? 

Recognising the pivotal role trademarks play in protecting brand identity is essential for your business. The McDonald’s vs. Hungry Jacks case underscores the need for trademark protection. It also highlights that businesses should be aware of the legal implications when initiating trademark claims. These include potential court orders and compensation pursuits. 

 

Additionally, the case serves as a reminder to exercise caution in marketing campaigns to avoid misleading or deceptive conduct claims. They have the potential for legal penalties and liabilities. 

  

Key takeaways 

  • First, know your trademarks—what they cover and how they guard your brand. 
  • Second, understand that misleading conduct is a risky game with serious consequences