Guest Post: Dominic Green is the Principal of Green & Associates Solicitors – You can connect via his Linkedin Profile or Startups can fill out the form at the bottom of the page for a free 30 minute introductory consultation.

The Dispute – Taking the Mickey

For those who don’t know, Deadmau5 (pronounced “dead mouse”) – a Canadian DJ of superstardom status – is perhaps the most successful electronic dance music act on the current global stage.

He rose to fame for ground-­‐‑breaking dance floor hits such as ‘Raise Your Weapon’, which have undoubtedly contributed to the financial success of his brand, in light of rumours he commands anywhere from $200,000 to $500,000 for single performances at the likes of Ibiza’s Amnesia festival, Miami’s Ultra Music Festival and the Future Music Festival, which tours Australia annually.

On the other part, Disney needs no introduction, given that Mickey Mouse and a chest of other iconic characters introduced since the historic release of the original “Steamboat Willie” cartoon are etched into the minds of the vast majority of children born since the 1920s.

Although Deadmau5 has been using his logo (pictured) now for the better part of a decade, not only on his products but also as an identifying stage prop helmet worn during gigs, Disney has taken issue only recently.

In fact, Deadmau5 filed a trademark application for “his image” with the U.S. Patent and Trademark Office back on 28 June 2013, although interestingly, Disney’s opposition to the application – essentially that Deadmau5’ logo is too similar to the Mickey Mouse ears – was apparently only voiced when it filed its first formal opposition on 28 March 2014, and a subsequent opposition to another application on 2 September 2014. Perhaps even more interestingly, the trademark had already been registered in some 30 countries, including the U.K., Ireland, Germany and Japan (although not the U.S.).

To make matters worse, in retaliation, Deadmau5 launched a copyright assault on Disney, claiming that Disney’s use of the cult hit “Ghosts ‘n’ Stuff” without his permission in a “Disney Re-­‐‑Micks” (a short montage clip of old Disney cartoons published online with the song playing in the background) constituted an infringement.

The bizarre aspect of the dispute is that, apparently, prior to Deadmau5’ copyright application, and therefore before the commencement of the dispute, LucasArts, which was acquired by Disney in 2012, had licensed “Ghosts ‘n’ Stuff” for a special mode in its Xbox Kinect game Star Wars, featuring Darth Vader dancing to the track.

Moreover, Disney’s music division had apparently extended an offer for Deadmau5 to remix the Star Wars theme song for the animated series Star Wars Rebels, which would have surely meant even more lucrative exposure for the up and coming DJ.

Needless to say, the offers are said to have been pulled once Deadmau5’ trademark application became known.

The parties are now ear‑to‑ear in a bitter legal dispute, with both claiming, in effect, that they are among the greatest animated characters of all time, and that the intellectual property (“IP”) infringement of the other – each on different grounds – is causing damage to their respective businesses.

With businesses of such magnitude, this multifaceted dispute raises several questions, and implications, for hopeful start‑ups.

What Relevance does this Cat and Mouse Game have for Start-Ups?

Another interesting aspect of this case is that apparently, Deadmau5’ original trademark application – the basis on which all others were made – was lodged in Australia. We discuss the reasons why further below.

For now, it is important to understand that IP protection and infringement are not simply local issues confined within the borders of a single nation. In fact, IP is one of the largest and most important aspects of international law.

Historically, the major commercial nations have cooperated in this area, largely as a means of strengthening trade ties. In some cases, two nations band together to contract in a single treaty governing the two of them, such as is the case with the Australia-­‐‑United States Free Trade Agreement (“the Agreement”), Chapter 17 of which is dedicated to IP issues.

Often such treaties will reaffirm and incorporate other multilateral international instruments, such as the “Madrid Protocol” (1989) and the “Paris Convention” (1967), which are predominantly relevant here from a trademarks perspective; and the “WIPO Copyright Treaty” (1996) and the “Berne Convention” (1971), which are mainly relevant from a copyright perspective.

Generally, these international instruments are effective without a bilateral treaty such as the Agreement, and bind signatory countries to ensure that their own domestic legal systems – in our case the Trade Marks Act 1995 (“the TM Act”) and the Copyright Act 1968 (Cth) (“the CA”), their respective accompanying regulations, and in turn, the common law – uphold the minimum obligations in those treaties. In most cases in this area, the major commercial powerhouses of the world are parties to such treaties, including those mentioned above in which Deadmau5 already had registered trademarks.

As with anything, the U.S. is all too often a force with which all others follow suit, as has been shown to be the case with Australia’s corresponding extensions of copyright terms and more. Without getting too boring, the effect of the international framework is that a minimum benchmark of IP rights and obligations is protected throughout the greater commercial world, which enables protection and enforcement of trademarks and copyright, often without the need to even formally register such interests in foreign countries.

In layman’s terms, what this means for all you existing or hopeful entrepreneurs out there is that the app idea you have – the one that can be downloaded to any smart device and used anywhere in the world – might land you in trouble on the other side of the globe without you even knowing it, and someone else out there could be building their way up to wiping out the brand you’re working so hard to build, even if you’ve taken every measure you can think of at home to protect it.

In effect, without having the benefit of specific legal advice based on your own individual circumstances, you can expect that the U.S. system, and therefore the case of Deadmau5 and Disney, is largely analogous here in Australia, and directly relevant to your business plans and/or operations. You should therefore proceed on the assumption that, without taking further action, the rights of others in the countries where your product or service might be used are even greater than they are here, and the rights you’ve acquired or built here won’t take precedence over someone else’s there.

In the next two sections, using this case (which as of the date of writing has not been determined), and applying the Australian system, we can illustrate some tips and traps that may help through some simple “Q&A”.

Lend Me Your Ears – Lessons in Trademarks and Copyright

Q1: Why would Deadmau5 attempt to register his trademark, when it seems this was the catalyst for the mammoth dispute? Would it have been sufficient for Deadmau5’ to rely on his own “copyright”?

A1: The starting point is of course that, yes, copyright can provide effectively automatic enforceable rights that are sufficient to protect your brand in some instances without the need to spend any time or money. However, copyright generally only exits in relation to certain things, meaning your product or service, logo, slogan or whatever else may not be covered.

In Australia, these things include literary, dramatic, musical or artistic works; cinematographic films; sound recordings; and television broadcasts. In addition, copyright has a limited lifetime, and will expire automatically, and perhaps more importantly, the work in question must have been original. If these conditions are met (among others), the “author” will then generally automatically have the exclusive right to reproduce, publish, perform, communicate and adapt the work, for example.

In the case of Disney, it is fairly obvious that “Ghosts ‘n’ Stuff” was an original musical work created by Deadmau5, and therefore giving him exclusive rights. By using the track in it’s “Re‑Micks” without permission, Disney would most likely be found to have infringed copyright. In a seemingly clear cut case as this, there may not be a need to go any further for protection.

The case of Deadmau5 is a different story. While his ears could be considered an artistic work, the glaringly obvious argument against copyright in his mouse ears is that they too closely resemble the Mickey Mouse ears, which tends to indicate that they are not original, but rather an adaptation, and therefore not only does copyright exist, but they may already be in breach of Disney’s copyright. This means, in effect, that Deadmau5 would need to look elsewhere for rights enforceable against others, to be sure, and also to protect himself against Disney.

On the other hand, a trademark, if registered, gives the registered owner exclusive rights to use the mark and to authorise others to use the mark. Obviously Disney already has several registered trademarks relating to Mickey Mouse, which means they could arguably prohibit Deadmau5 from using his ears at all, if it was found that they tended to confuse the public or dilute the distinguishability of Mickey’s ears, for example.

However, sometimes even arguably “substantially identical” or “deceptively similar” trademarks (such as this?) still get registered. If that occurred here, Disney would be prohibited from preventing Deadmau5 from using his ears, expect to the extent that Disney’s trademark allowed them to do so. This leaves certain gaps, to be discussed further below, but for now, it is worth noting it is not all too rare, let alone impossible, for a trademark application to fly under the radar and slip through the cracks.

Q2: Is there anything in particular about the specific form of Deadmau5’ application that might have a bearing on Disney’s opposition?

A2: Absolutely! Before getting to that though, it’s worth noting that Deadmau5’s application can be seen by anyone who cares to search the U.S. Patent and Trademark Office. This is the case in most countries, as it is with our IP administrator, IP Australia. That fact alone raises an important point – your trademark application can be seen at any time by anyone who cares to look for it, which means that your commercial confidences and plans may be discoverable, and you should carefully consider sensitivities and timing when making an application that will be published.

Specifically, there will be a trade-off between beating the rush to “get there first” in your space vs. ensuring you have concrete, bankable protection. In addition, as alluded to in the answer to the previous question, it is up to interested parties to inform themselves of such applications – IP administrators will not inform a business of an application that may be similar to theirs, meaning it is up to you to keep yourself informed and stop others slipping through the cracks by formally objecting to an application (discussed further below); something Disney is famous for.

Looking at Deadmau5’ specific application (U.S. Trademark Application No. 8597 2976), we can see that it is extremely wide, in that, not only has he attempted to secure its coverage over products and services we might expect him to use, such as stereo turntables and headphones, but he has sought its coverage over anything ranging from computer games through to magazines, carry bags, cereals, confectionary and fruit juices.

Every application has to specify a certain class, or a number of classes, of goods and services to which it is sought to apply. At least in Australia, each additional class nominated attracts an addition to the application fee. This obviously involves a choice, but while the choice may seem simple, it can have great implications.

The more classes you apply for, the greater the chances of stepping on someone’s toes, the higher the chances of opposition and the less likely your application is to be accepted; and vice versa. On the other hand though, sometimes, the greater the classes, the better, as the greater the chances you may succeed on one or some classes that may be relevant to you.

The grounds of opposition and rejection are also directly relevant, and in practice go hand-­‐‑ in-­‐‑hand with class selections. They include, for example, that the trademark, in respect of those particular classes of goods or services, would be likely to deceive or cause confusion; is substantially identical with or deceptively similar to another trademark; that the applicant doesn’t actually intend to use the trademark; or that the trademark is similar to a trademark that has acquired a reputation in Australia.

Obviously then, the lesser the classes nominated, the lesser the chances of rejection, meaning an almost identical mark could be used by two different entities operating in different industries, provided of course they did not seek protection in other areas.

Going back to Deadmau5’ application, obviously the number of classes he has applied for would have contributed to both Disney’s identification of his application, and their decision to oppose it, particularly given that the products mentioned above are products that Disney would typically sell. In a sense, one might say this was a foolish move, and one might be correct. Although, it may prove in time to be sheer genius.

Specifically, in the case of nearly identical trademarks and similar goods or closely related services, if there has been honest and concurrent use of the two trademarks, or if, because of other circumstances, it is proper to do so, an application may be accepted subject to conditions or limitations. This could be the case even if most of the other grounds of objection were legitimate in a dispute.

As Courts like to strike a good balance between the parties to any dispute, where it is just to do so, Deadmau5 may have set himself up quite well for a compromise whereby he obtains his protection for an animated mark with facial features, as opposed to just a silhouette, or where he gets the stereo turntables, headphones and so forth, while Disney keeps the backpacks and children’s food.

That is, provided it is not determined that Deadmau5 doesn’t actually wish to produce products of the latter variety, and that his application hasn’t therefore been made in bad faith.

Q3: Is the size of either party, or rather their reputation, relevant, and if so, how?

A3: Yes, size does matter. The first and most obvious reason is, the bigger the incumbent, the more at stake, and the bigger the new applicant, the greater the risk of identification and defensive assault. Also, the size of a brand and its reputation has a direct bearing on the success of objections, such as those based on a pre-­‐‑existing reputation of a trademark in Australia, and also defences, such as that based on the fact that the two trademarks have been used honestly and concurrently.

Depending on the circumstances of any given case, the bigger the name of one party is, the less likely it is that it will require protection. For example, it can hardly be said that Deadmau5’ ears could really be confused with those of Mickey Mouse.

On the other hand, the more a party has come to rely on a distinguishing or identifying mark, the more likely it is that it will be protected.

In the case of Deadmau5 and Disney, considering their respective differences, but their extreme levels of fame, it may well prove to be the case that both will maintain some form of conditional right over their respective mouse ears, enforceable against everyone else.

Q4: What relevance, if any, does Disney’s use of Deadmau5’ songs and their offers have on the situation?

A4: The fact that Disney (or at least its subsidiaries) have known of Deadmau5’ existence, let alone used his music – arguably in a manner that would indicate an association with Mickey Mouse himself – and made offers to him for further collaboration for consideration, could work heavily against them.

Remember, much like Deadmau5’ “Ghosts ‘n’ Stuff”, Disney’s Mickey Mouse illustrations are an original artistic work, and therefore copyright exists in Mickey (which is only due to yet further relatively recent extensions to copyright terms globally). This means that, if it wanted to, Disney could launch an action for breach of copyright against Disney. From the perspective of delay, such an action would be largely the same as their opposition to Deadmau5’ mark.

At common law, a partial or even full defence exists on the basis of the equitable doctrine known as laches or acquiescence. In Australia, it has at least been suggested that this could even be used to effectively shorten statutory limitation periods.

In layman’s terms, in the case of a CA-­‐‑based civil action for damages or an account of profits, Disney may be found to have actually accepted Deadmau5’ actions, and therefore be precluded from anything at all. In the case of dispute proceedings under the TM Act, this could theoretically be used to dilute or even discredit Disney’s grounds of opposition, and/or effectively reduce their limitation for filing that opposition (discussed further below).

Q5: What effect, if any, will waiting so long to apply for registration have on Deadmau5?

A5: The answer to this question is two-­‐‑fold: the first part relating to Deadmau5’ delay in making any application at all; and the second regarding Deadmau5’ delay in making an application in the U.S.

Regarding his application per se, on one view, every second Deadmau5 waited was causing him damage, in the sense that, while he was building a more and more valuable image, partly on the basis of his ears, the risk of an assault from Disney grew, even on the basis of copyright claims they may have had. However, in light of the above, on the other hand, delays were helping to strengthen his foothold.

In terms of his specific U.S. application, this could prove a very smart move. The reasons why are discussed in the answers to question 7 below.

Q6: What effect, if any, will waiting to take action against Deadmau5’ have on Disney?

A6: In addition to the answer to question 4 above, Disney’s delays could have had potentially severe and irreversible consequences. The biggest reason is that there are time limits imposed on the lodging of oppositions to trademark applications. In Australia, IP Australia will advertise an accepted application for a period of two months to enable objections, but after this point, unless a compelling reason is provided and an extension granted (which is extremely hard to achieve), the opportunity to oppose, and therefore to block an application or ensure it is restricted, will be lost.

In Disney’s case, the worst case scenario is that, in relation to any countries in which it may not have already registered trademarks (which is highly unlikely), Deadmau5 may actually now be in a position to oppose their use of the Mickey Mouse ears on products similar to these he may sell. The best case scenario is that, even in the countries in which it had existing registered trademarks, Disney has most likely lost any opportunity they had to restrict the classes of goods to which Deadmau5 may apply his ears and / or to ensure that he can’t use the closer silhouette version of his mark. If Disney had waited any longer, the latter may have also been the case in the U.S.

In each country, much like with real property registers, there are also systems and rules of priority that may have a bearing on the eligibility of a trademark for registration and / or the conditions that may be imposed on the registration of similar trademarks. As you might expect, time is usually the critical factor in priority cases.

Q7: Are there any implications that arise from the fact that Deadmau5’ application was already registered in other countries, and is there any other reasons why Deadmau5 would first apply in Australia, or anywhere other than his home country, the U.S.??

A7: Yes. Under the international system, where a trademark has actually been registered in the country of origin (in Deadmau5’ case Australia), it must be accepted for filing and protected in its original form in the other contracting states. So, in this case, Deadmau5 may have been a little sneaky in applying first elsewhere, perhaps because he knew that Disney was less likely to pick up on foreign applications, and that this would mean a win overseas and a potentially much smoother ride in the U.S.

However, this does not mean that a registered trademark in one country will of itself ensure that an application is successful in another – there are exceptions to the rule for automatic acceptance for filing and protection in foreign countries. Perhaps the most common of these is the case where the trademark, if registered, would infringe the acquired rights of third parties (such as other trademarks and / or copyright in the foreign country).

This exception, as with the others, have largely been built into the domestic systems, such as in the grounds of objection set out in the TM Act and discussed above. While Disney may have a strong argument in this regard, recall the issues discussed above and the fact that it sometimes takes much more, or particular circumstances may trump others in any given case. Possibly the most important of those are again the limitation periods that apply to objections and priority systems in place.

Their significance is exacerbated in the context of international applications, meaning they become even more dangerous (i.e. for Disney), or beneficial (for Deadmau5), given that an application filed in a subsequent country only on the basis of an application made (as opposed to actual registration) in another country could have the effect that the subsequent application will be taken to have been file on the same day as the original application in some cases, meaning, in effect, that domestic statutory limitation periods can be reduced simply by filing elsewhere, possibly in addition to any shortening effect any existing laches or acquiescence argument may have.

 

ED: This is not the only trademark issue DeadMau5 is dealing with, recently he received a Cease & Desist Letter from Ferrari for his highly stylised Nyan Cat Car Ferrari called the Purrari.

The Big Cheese – Conclusions

In light of the above, here are some generally applicable pointers to take away:

• Never underestimate your product or service. Always assume you will become a globally-­‐‑recognised presence – to do otherwise could severely harm you.
• In some cases, the nature of your product or service may mean that there really is no point in spending time or money trying to protect your image or work. This may mean that copyright is sufficient to avoid trademark applications. On the other hand, it may mean that there simply is just no utility in making any applications for anything.
• The time or money that seems relatively impossible now may save you mountains in avoided disputes or diverted business down the track.
• Think very carefully about the competitors in your industry before relying too much on an unprotected image, logo, slogan, sound or otherwise.
• Consider in depth the timing of any protective measures you may take, and weigh up the risks and alternatives.
• If your IP is worth protecting, keep a lookout in all relevant countries for potentially infringing use or competing applications.
• If you become aware of potential infringement, or even competition you can take action about, don’t delay for a minute.
• For other issues or more specific advice, feel free to contact the author.
• Dominic Green
  Principal
  © Green & Associates Solicitors 25 September 2014

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