A small Gold Coast travel operator has won his 18-month fight to block national hotel giant Mantra, which tried to register the name of an iconic Gold Coast tower Q1 as its own and prevent some businesses from using the tower’s name in their own businesses.
Danilo Spagnuolo, who owns two apartments in the Q1 tower, operates Q1 Holidays Gold Coast, which leases these apartments and several others in the building to tourists.
In February 2009, Spagnuolo lodged a formal objection with IP Australia after Mantra attempted to make “Q1” a trademark in March 2008. Mantra owns and operates the Q1 Resort & Spa in the building, and leases 500 apartments.
Mantra, which acquired the Q1 trademark from Gold Coast developer Sunleisure in 2004, argued that as the exclusive letting agent for the Q1 building, it should be entitled to “all goodwill subsisting in the Q1 brand”.
“The applicant is the exclusive onsite letting agent for the Q1 building and no other entity is allowed to perform such services. Use of the name “Q1″ in the Q1 Marks simply identifies the building in relation to which the Applicant is exclusively entitled to provide onsite letting services and is use in word form of a trade mark registration it already owns,” Mantra’s lawyer told the trademark hearing.
However, hearing officer Claudia Murray disagreed and said the Q1 building has become so iconic on the Gold Coast, and was home to so many different businesses, that allowing just one business to use the Q1 moniker could confuse the public.
“I find that, because of the geographical connotation contained in the Q1 sign, there is a real likelihood that its use as a trademark by the applicant in respect of the very wide range of services specified in its applications will cause deception and confusion of the public,” Murray wrote in her decision.
“The Q1 sign is the only name of a building which, by virtue of its multi-faceted identity, has in the words of the Full Federal Court ‘become part of the common heritage’. As such, it has a connotation that effectively eclipses any function it might otherwise have performed in denoting any single trader, and which renders it simply unsuitable for use as a trademark.”
Spagnuolo told SmartCompany he was pleased with the outcome of the hearing, although was aware of reports that Manta is likely to appeal to have the matter heard in the Federal Court.
But he says the decision is likely to have ramifications for other small tourism operators who lease out apartments in major buildings, who would be hit hard if they were unable to use the building’s name in their marketing.
“You are crippled in your marketing and crippled in any sort of way, because you are classified as a shonky business operator,” Spagnuolo says.
“It’s hard when a company that has nothing to do with you is telling what to do. Commonsense has prevailed… sometimes the big company doesn’t always win.”
Mantra declined to comment before publication, but has told the Gold Coast Bulletin that it plans to appeal the case.
After 18 months of a distracting legal battle, Spagnuolo would like the case to end, but is prepared to keep fighting.
“The next move should be theirs, and we’ll just take it step by step.”
Intellectual property lawyer Trevor Choy says the case is an interesting follow on to a separate action involving Mantra and another Gold Coast building Circle on Cavill, where the company was successful in proving small tourist operators were breaching the Circle on Cavill name.
“They clearly felt they needed to get really, really aggressive following that case,” Choy says.
He says Mantra faced two problems. Firstly, the trademarks were not registered quickly enough; Choy says they should have been registered well before 2008, when the building was well and truly running.
Secondly, Mantra’s decision to pursue Q1 Holidays Gold Coast by complaining to accommodation website Stayz about the small operator’s ads may have eventually backfired, as this showed there was confusion about the Q1 brand, and no one firm could own the trademark.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
