Hell hath no fury like the Hells Angels – at least in respect of misuse of its trade mark portfolio.

Recently, Sonny Barger, known as the founding member of the Hells Angels Oakland charter, died after a long career as a “outlaw biker, author and actor”. The Hells Angels Motorcycle club has had, to some degree, a similar career trajectory; where once it was considered solely an “outlaw” club with disparate charters across the United States and extending overseas to Australia, it now comprises a global group of ostensibly legitimate entities operating under the Hells Angels name and logo (comprising a skull wearing a winged helmet).

In this case, Hells Angels Motorcycle Corporation (Australia) Pty Limited (“Hells Angels Australia”) sued Redbubble Ltd for infringement of Hells Angels Motorcycle Corporation’s (“Hells Angels US”) registered trade marks in Australia comprising the words “Hells Angels” and images of skulls wearing a winged helmet. Hells Angels Australia did so as an exclusive licensee, or “authorised user”, of the US corporation’s registered marks.

Avid readers will recall an earlier proceeding commenced in 2015 and determined in 2019 in which Hells Angels Australia successfully sued Redbubble for trade mark infringement: Hells Angels Motorcycle Corporation (Australia) Pty Limited v Redbubble Limited [2019] FCA 355. The present proceeding concerns fresh allegations of trade mark infringement.

Even more avid readers will recall that in March this year, a separate question was raised concerning whether Redbubble could rely on a settlement agreement reached between Hells Angels US and a third party, TP Apparel Inc, which Redbubble subsequently purchased. Rudbubble’s asserted reliance on the settlement agreement was rejected by Jagot J in Hells Angels Motorcycle Corporation (Australia) Pty Limited v Redbubble Limited (No 4) [2022] FCA 190. With that side skirmish dealt with, the parties rode on into the final stage of the dispute.

As annoying as lawyers might find the missing apostrophe in the Hells Angels name, the club is adamant that “...it is you who miss it. We don’t” (happily not forgetting the apostrophe in “don’t”). But that lack of attention to detail in relation to its own brand is not replicated when it comes to others’ alleged appropriation of it. And so we return to the present case.

Redbubble provides an online marketplace where independent artists promote their works to consumers who can then have that artwork applied to various goods supplied by other providers. The artist chooses what products customers can apply the artist’s work to and the cost of doing so. No company within the Redbubble group provides the artistic works or manufactures, warehouses, despatches, receives or distributes any physical products ordered by customers.

Notwithstanding that “hands-off” business model, the Court found in the 2019 decision that Redbubble had engaged in trade mark infringement. The questions in that earlier case were whether the application of the Hells Angels marks to goods was Redbubble’s conduct and if so whether that involved Redbubble using the mark as a badge of origin. In the 2019 decision the Court held:

Redbubble is the supplier of the goods (clothing) bearing the trade marks because it enables the sale and purchase transaction, confirms the order, takes payment, receives revenue for itself and facilitates revenue payable to the artist, instructs the fulfiller, arranges delivery and places its own name and logo on the goods in the form of swing tags as part of its set of procedures for the supply of the goods. The artist makes the work available for selection by consumers for application to selected goods. Redbubble is directly engaged in all facets of the transaction for the supply of goods bearing the works, to the consumer. That is the way the Redbubble business model works, and the way that it is designed to work.

The Court in the 2019 decision found that Redbubble was using the Hells Angels marks “within its own business and revenue model, in the course of its supply-side transactional trade effected through the Redbubble website, in relation to the supply of goods” for the purpose of indicating a connection in the course of trade between clothing bearing the marks and Redbubble “as a source of supply of those goods”. In doing so, the Court arguably applied very broad meanings to the words “using” and “source”, but Redbubble did not appeal that decision.

Hells Angels’ complaint in the present proceeding was that Redbubble’s business model had led to further occurrences of trade mark infringement. After the 2019 decision, a “trade mark officer” of Hells Angels Australia ordered goods to which the relevant images could be applied for purchase, sale, payment and delivery, through Redbubble’s website. He ordered coasters, a canvas‑mounted print, an acrylic block, a sticker, t‑shirts and facemasks.

Redbubble’s primary defence to infringement was that the evidence of alleged infringement was limited to trap purchases by Hells Angels Australia which comprised an authorisation to use the mark. Redbubble contended that to the extent that Hells Angels caused the trap transactions to occur, Redbubble’s impugned conduct had occurred with the authority of the rights owner and could not constitute infringing conduct, as the very essence of infringement is engaging in conduct falling within s.120(1) of the Trade Marks Act 1995 (Cth) without the licence or authority of the trade mark owner. Justice Greenwood did not give this defence much credit, observing that:

No trap purchase could ever be evidence of conduct constituting infringing use if that evidence was habitually displaced or ignored by courts on the footing that it necessarily occurred with the authority of the rights owner. A trap purchase is, functionally, evidence of whether a party is “using”, as a trade mark, a “sign” exhibiting the features described in s 120(1) of the Act in relation to goods or services for which the mark is registered, on the footing that what is reflected in the trap purchase is conduct which is occurring in the relevant marketplace. By reference to that evidence, the Court is put in a position where it can see by disciplined and accurate probative evidence, the emblematic character of conduct occurring on the part of the relevant trader in the course of its business so as to be in a position where it can reach a conclusion about whether all of the integers of s 120(1) of the Act are satisfied (if that is what is occurring).

Curiously, his Honour did not refer to the decision of Justice Merkel in Ward Group Pty Ltd v Brodie & Stone Plc [2005] FCA 471; (2005) 143 FCR 479, where it was found that trap purchases did not evidence infringing use of a registered trade mark in Australia because that use was consented to by the trade mark owner. The circumstances of that case were peculiar, because it was clear that the impugned website was registered overseas and was not directed to Australian users, and the first (and perhaps only) purchase made from the website, was by the trap purchaser, the trade mark owner’s solicitor. Nevertheless, it is odd that no mention of that decision was made.

While Redbubble accepted that its overall business model had not changed, it contended that it had increased the automation of particular functions on its website and engaged in “constant improvement of processes designed to discourage, prevent and penalise infringements and contraventions of IP rights”. However, the Court observed that those activities had “failed in large measure to protect the applicant” and so did not warrant denying the injunctive and declaratory remedies sought by Hells Angels Australia. Redbubble’s contention that the better course was for Hells Angels’ solicitors to promptly advise Redbubble of any concerning content on the website was rejected.

As to damages, Justice Greenwood observed that this was not a case where the respondent has sold a wide‑range of goods bearing the impugned trade marks. The impugned transactions were all made by Hells Angels Australia’s trade mark officer, Mr Hansen. There was no evidence of reputational loss, or a lost licence fee, or lost sales. Nevertheless, there was likely some loss or injury suffered through the unauthorised use. Accordingly, his Honour awarded a “nominal” sum of AU$8,250 for the 11 examples of trade mark infringement.

Finally, his Honour found that an award of additional damages was warranted. While the infringements did not occur as a result of a callous disregard of the applicant’s rights, and significant steps had been taken to avoid the infringements “the fact is that [Redbubble’s] business model enables the conduct” and Hells Angels Australia “is entitled to expect and have Redbubble act according to law.” Importantly for purveyors of online markets, his Honour held that:

Redbubble is not entitled to proceed on the basis that because its business model involves the management of a large digital platform, unfortunately, from time to time, infringements of the rights of others will occur and it will seek to proactively manage and moderate that circumstance as best it can according to the programs it puts in place from time to time. Redbubble has an obligation to act according to law and observe the rights conferred on others.

Accordingly, his Honour primarily awarded additional damages to ensure general and specific deterrence of the misconduct, in the sum of AU$70,000.