Local shoe manufacturer Australian Leather Pty Ltd is being sued by US shoe giant Deckers Brands over the use of the word “ugg”.
US-based company Deckers Brands owns the global copyright on the word “ugg”, except in Australia, and it uses the mark to sell its “UGG Australia” branded boots.
It is now seeking global injunctions in a US district court to prevent Australian Leather from describing their sheepskin boots as “ugg boots”, having previously taken action against other manufacturers of ugg boots in the past, according to one intellectual property expert.
Deckers successfully registered the trademark for “UGG Australia” in 2006, which is registered across over 130 countries. This global trademark means Australian ugg manufacturers cannot sell their wares overseas, costing them millions in sales each year.
Its latest efforts to prevent other companies from using the label “ugg boots” is now shaping up to be a David and Goliath battle, with Eddie Oygur, owner and founder of Australian Leather, telling Fairfax his company, which is “nothing compared to that company”, is at risk of closure as a result of the legal action.
“Since 2009 we have missed out on one overseas order for 200,000 pairs a year, and another order to Germany for 75,000 pairs,” Oygur says.
“From just those alone I have lost a minimum of $20 million in business.”
Deckers sell their UGG brands across Australia, with over 40 stockists in the country. However, UGG Australia boots are made in Australia and the company charges up to $40 more compared to local manufacturers.
“Deckers advertise [their boots] as UGG Australia, but there’s nothing Australian about it,” Oygur said.
Deckers is calling for all Australian Leather boot stock to be delivered to Deckers to be destroyed, along with the seizure of all funds in the company’s accounts.
“A real life global version of The Castle“
Independent South Australian Senator Nick Xenophon has labelled the action by Decker as “legal bullying” and has begun a change.org petition seeking government action. At the time of publication, more than 2300 people had signed the petition.
Xenophon describes the case as “a real life global version of The Castle”, and has pledged to introduce legislation to parliament to protect the Australian use of the word ”ugg” if re-elected at the federal election in July.
“Politicians can talk about supporting Australian jobs, but they need to put their money where their mouth is,” Xenophon told Fairfax.
“The government needs to back Australian businesses.”
Xenophon has also compared potential government protection of the word “ugg” to the protection of “champagne” in France or “feta” in Greece.
Deckers’ website contains a “Fact or Fiction” section detailing different areas of their UGG trademark, which claims the company is not mounting a campaign against Australian ugg manufacturers. Instead, it says it is protecting its brand as “some Australian dealers have attempted to pass off their boots as Deckers’ UGG Australia brand”.
The company has received backlash on Twitter from commentators confused as to why the company is taking legal action over the iconic footwear.
@UGG so weve had UGG BOOTS trademarked in Australia for years and you guys think you own not only its name but the whole world !!
— peteandcaz66 (@peteandcaz66) 23 May 2016
— Jean-Paul H (@jeanpauljh) 23 May 2016
The latest in a long line of ugg cases
However, John MacPhail, intellectual property specialist and partner at Lynch Meyer Lawyers, told SmartCompany trademark disputes over the use of the word “ugg” have been going on for years.
“They’re wanting to export and that’s why there’s an issue,” MacPhail says of the Australian companies involved in the disputes.
“Australian Leather is the tallest poppy, but this lawsuit shouldn’t be a surprise for them.”
“It’s been going on so long, they should know that they can go up to the mark but not overstep.”
MacPhail says Xenophon’s desire to get government protection for trademarks such as “ugg” is a “pipedream” when compared to protection for products such as French champagne.
“It just doesn’t rise to the same level, those things are recognised as coming from a specific geographic area,” MacPhail says.
“Uggs just don’t have the same amount of artisanal concentration.”
SmartCompany attempted to contact Deckers Brands and Australian Leather but did receive a response prior to publication.