able to use the Bega trade marks on
Products being ‘Cheese Products,
butter and any other products
agreed by the parties from time
to time’. ‘Cheese Products’ were
defined to mean natural and
processed cheddar cheese, string
cheese and any other cheese which
the parties agreed in writing should
be included. At the time the TMLA
was entered into the only products
being manufactured were natural
and processed cheddar cheese
and Bega did not manufacture any
other types of cheese. The Court
noted that “neither party gave any
consideration to the application of
Bega’s trade marks to any products
other than cheese and dairy
products” and that given the narrow
nature of the products defined in the
agreement, Bega was free to use its
name in relation to goods like peanut
butter. With hindsight, it would have been
advantageous in such a long-
term agreement, for the parties to
consider possible business evolution
and expansion of products
and include clauses
addressing those
situations in
the TMLA.

The narrow drafting of the definition of
products along with the fact that
the additional products could only
be included by agreement of the
parties meant that the Court could
not construed the application of
the TMLA in the broad fashion that
Fonterra was hoping for.

Conclusion Intellectual property licensing is
critical to business success but if
not drafted properly can lead to
unintended outcomes and costly
mistakes. There is benefit in
thinking through a range of possible
eventualities and working with
experienced licensing lawyers to
ensure that your licenses capture
the parties’ true intentions and take
into account future business growth
and development.

It’s easy to assume
that the parties are all
on the same page when
it comes to their rights
and obligations under
an agreement, which
they generally are –
until they aren’t.

Inspire July 2022
diversity was covered by their
exclusive licence. The Court did not
agree, finding that a gender equality
campaign was not the same as
“gender diversity issues in corporate
governance (or the financial services
sector)”. If SSGA was intended to
have rights in relation to broader
gender diversity goals, then the
licence granted by the Master
Agreement would have reflected
that. In this case using the words “ in
connection with” did not operate to
expand the scope of SSGA’s licence.

Ensuring that a licence agreement
accurately captures what rights the
parties have is paramount, because
the Courts will not step in to provide
rights that a party does not have.

As Justice Beach pointed out in
this case, there was “considerable
disparity between what [SSGA]
paid for and what it now asserts it
is entitled to protect. But Australian
statute law and tort law cannot fill
that gap.”
These issues are not limited to
copyright, with similar questions
raised in the context of trade
mark licensing in Fonterra v Bega
Cheese 3 . The Victorian Supreme
Court had to determine whether a
TMLA prevented Bega from using
the Bega trade mark on peanut
butter, vegemite, cheese and cream
cheese spreads as Fonterra
argued. Fonterra and Bega
had entered into a 25
year TMLA for
Fonterra to be
11 Melissa Wingard | Special Counsel
BA(Eng&Hist) LLB(Hons) GradDipLegPrac
GradDipAppFin&Inv MCyberSecOps
3 Fonterra Brands (Australia) Pty Ltd v Bega Cheese Ltd [2021] VSC 75
melissa.wingard@pof.com.au