A Requiem for Champagne Heidsieck: Trade Mark Use and Parallel Importation

Abstract

The “Champagne Heidsieck rule”, under which the importation and sale of legitimate branded goods has been held not to involve use as a trade mark, has historically provided an important mechanism to facilitate the parallel importation of trade marked products in Australia. However, following a number of recent Federal Court decisions, the rule has been written out of Australian law. This means that parallel importers and sellers of second-hand goods need to rely on the problematic defence contained in s 123 of the Trade Marks Act to avoid liability. This article traces the history and reception of the Champagne Heidsieck rule in Australia, and argues that the courts have taken a wrong turn by doing away with the rule, in part based on a misunderstanding of the history of the role of confusion in registered trade mark law. After discussing the numerous problems with the current s 123 defence, we consider how the Australian law on parallel importation and sale of second-hand goods could be improved, concluding that the best option is to resurrect the Champagne Heidsieck rule.

Keywords: Champagne Heidsieck Rule, Trade Marks Act, sale of second hand goods, trade mark law