Redbubble can’t outrun Hells Angels infringement suit
The Australian Federal Court has ruled that e-commerce site Redbubble must face a lawsuit from biker gang Hells Angels for selling unregistered merchandise sporting the gang’s imagery.
Redbubble looked to dismiss several cases of alleged infringement of the Hells Angels Motorcycle Corporation Australia trademarks by citing a settlement agreement with one of its subsidiaries in May 2021.
However, Justice Jagot ruled in a judgment handed down on Tuesday, March 8, that the scope of the settlement agreement does not apply to seven examples of the alleged infringements and denied Redbubble’s bid.
The Hells Angels commenced its litigation on December 31, 2020, alleging that Redbubble had infringed its trademark rights with seven designs found on its marketplace.
Justice Andrew Greenwood heard the case at the Federal Court in July 2021 but reserved judgment. In September 2021, Greenwood granted Hells Angels leave to re-open to include claim examples of four further examples of alleged trademark infringement.
The Angel’s cited four marks that it claims were infringed by Redbubble that was relevant to these proceedings, including Australian trademarks numbered 526530, 723219, 723463, and 1257992.
However, Redbubble held in an amended defence filed in December 2021 that the first seven infringement claims were already answered by the prior settlement agreement.
It claimed that the settlement between Teepublic and the Hells Angels Motorcycle Corporation extended to the current claims as Redbubble as it was party to the agreement as corporate parent and affiliate of Teepublic.
Hells Angels Motorcycle Corporation Australia submitted that the settlement agreement does not apply to the dispute the seven examples of alleged infringement in this proceeding.
In his judgment, Justice Jagot said that both party's submissions about the construction of the settlement agreement “struck me as tenuous”.
He added: “Redbubble also appeared to suggest that the similarity of the business models used on the Redbubble website and the Teepublic website was relevant to the construction of the settlement agreement. However, this assumes that the Redbubble website forms part of the ‘commercial purpose or objects to be secured by the contract’.”
According to Jagot, Redbubble took a “textual literalism” approach to its analysis of a section of the agreement that held that the scope of the settlement agreement applied to complaints of items on the Teepublic marketplace, as well as “corporate and parent affiliates”.
Redbubble, therefore, considered the settlement to extend to its own actions, meaning it could not be sued for the first seven instances of the alleged infringement.
Jagot said: “Contrary to Redbubble’s submissions, the representations and warranties… do not support textual literalism because they too are to be understood in the context of the proper construction of the settlement agreement.”
“The relevant point, however, is that the settlement agreement concerns only the operation of the TP Marketplace website. It is the dispute about that website alone which is being settled, not any other website… It follows that the settlement agreement does not apply to any aspect of the dispute the subject of this proceeding. This proceeding concerns claims of HAMC AU against Redbubble in respect of the operation of the Redbubble website.”
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