What the Crumbl Cookies Pop-Up Taught Us About Trademarks and Australian Consumer Law

A pop-up shop in Bondi recently got a lot of attention for selling cookies from the popular United States business, Crumbl Cookies. If you’re unfamiliar with Crumbl Cookies, you can click their website here.

However, it turned out that this pop-up wasn’t connected to the United States Crumbl Cookies business, and the incident highlights some important lessons for businesses about protecting their trademarks and brands in Australia.

The United States Crumbl Cookies business has registered trademark rights in Australia for its logo. You can access their publically available Trademark Registration here.

As you will see, the Registration features the words “crumbl cookies” and a cartoon baker’s head with chef’s hat, see below:

The Crumbl Cookies business is well-known, in both the United States and Australia, for its use of a signature light pink colour on packaging.

Apparently, Crumbl Cookies USA has decided not to take action against the pop-up, however Crumbl Cookies USA will be setting business in Australia.

So what happened?

The pop-up advertised itself on TikTok under the name @CrumblSydney, claiming that “Crumbl is landing in Australia.” Reports suggested that the United States business’s trademarked logo and other branding were used to promote the pop-up, and a number of video clips posted online showed the cookies being sold in packaging of the same shade of pink as used by the United States business, and bearing the name “crumbl”. However, the pop-up’s organisers insisted that they hadn’t been using the U.S. business’s trademarks in their marketing, and that, in any case, they were legitimately onselling genuine “Crumbl Cookies” products that they had purchased from a “Crumbl Cookies” store in the United States.

Despite the high price of AUD $17.50 per cookie, the pop-up attracted large crowds. But many of the customers who posted about their experience were disappointed with the (lack of) freshness of the cookies. Soon after, the United States Crumbl Cookies business clarified on social media that they had no connection to the Bondi pop-up, and were themselves planning to enter the Australian market in the near future.

What Was the Legal Situation?

In Australia, parallel importing (where goods are bought overseas and resold locally) can be hard to stop legally if the products are genuine. But, the Bondi pop-up raised issues because:
Many customers thought they were buying Crumbl cookies directly from the U.S. business, which was not the case, and
The cookies had deteriorated in quality between the time when the organisers purchased the product in the United States and when they onsold them in Bondi – and this had a damaging effect on the U.S. business’s reputation in the genuine product.

While the U.S. business has decided not to take legal action against the pop-up’s owners, the incident highlights some key points for businesses looking to protect their brands in Australia.

1. Register Your Trademarks Early

If you’re planning to bring a product or service to Australia, it’s a good idea to register your trademarks as soon as possible. The trademark registration process can take a while, so it’s best to get started early. If you don’t use your trademarks in Australia for three years, someone else may try to cancel your registration, but even a small presence in the country can help protect your brand.

For example, by having a small presence in Australia, U.S.-based In-N-Out Burger successfully stopped a local business from using a similar name, even though In-N-Out Burger didn’t have a full store there.

If you want to protect your brand, you should start off with due diligence, including a search done by a Trademark Attorney. To read up more about this, click here.

2. Parallel Imports and Trademark Issues

Parallel importing happens when people buy products from overseas and sell them in Australia – but without being authorised distributors. As long as the products are genuine, it’s usually okay to resell them, even if they bear the original branding/trademark(s). But, trouble can arise if the reseller (parallel importer), without permission, uses the original branding in their marketing materials or advertising. Also, if the parallel import differs significantly from its genuine counterpart, its unauthorised importation may be seen as being misleading or deceptive conduct, and therefore a breach of Australian Consumer Law.

To protect your branding, it’s important to register your trademarks in Australia. Then, you can stop anyone from using your trademark(s) in a way that could confuse customers.

3. Don’t Mislead Consumers

Under Australian Consumer Law, businesses can’t make false claims about their business or their products. For example, they can’t say (or give the impression) that they are affiliated with the brand owner if that’s not the case. In the Crumbl case, even though the cookies being sold were genuine, the issue was that the pop-up didn’t make it clear that they weren’t actually associated with the United States Crumbl Cookies business. There was also a possible issue with the quality of the cookies being onsold by the Bondi pop-up.

If you’re selling products bearing the branding of another trader, you need to be careful not to make people think that you’re officially linked to that brand if you’re not. Otherwise, you could get into legal trouble for misleading customers.

4. Protecting Your Brand and Reputation

Businesses spend years building up the reputation in their branding, so it’s important to protect that. By registering your trademarks and keeping an eye on the market in Australia, you can stop others from using your brands in ways that might confuse or mislead customers.

Even though, in this case, the United States business decided not to take legal action against the Bondi pop-up, the situation highlights how important it is to protect your brand. A strong trademark registration and monitoring the market can help prevent problems before they happen.

Disclaimer

The above information should be treated as “informative only”. Legal advice must be sought for every individual and their particular commercial needs and circumstances. Please contact your Patent and Trademark Attorney from our firm to examine and assess your particular situation and provide advice that suits you.