Article Summary
A Federal Court decision demonstrates how trade mark risks can disrupt product launches, with an interim injunction forcing the withdrawal of 47,000 gift cards. The case highlights the importance of treating branding decisions as legal risk management.
When launching a new product, branding is often treated as a marketing decision. This case is a timely reminder that it is also a legal risk decision, and missteps can be swift, disruptive and costly.
In Prezzee Pty Ltd v Epay Australia Pty Ltd [2025] FCA 1662, the Federal Court granted an urgent interim injunction restraining the rollout of gift cards featuring the phrase “Powered by Prezzy Card”. The respondent was required to take immediate steps to stop supply, notify retailers, disable activation where technically feasible, and physically retrieve remaining stock from sale.
For business owners, the takeaway is clear: if your branding crosses into another party’s trade mark rights, your product launch can be stopped (and reversed) overnight.
Background
Prezzee Pty Ltd (Prezzee) is a global provider of digital gift card services. Prezzee is also the registered owner of nine Australian trade marks incorporating the word “Prezzee”, registered across several classes including those relating to gift cards, gift vouchers and related services.
Epay Australia Pty Ltd (Epay) operates in the prepaid gift card market. In New Zealand, Epay owns and markets a long-established product known as the “Prezzy Card”, being a preloaded Visa gift card.
During 2020 Epay contacted Prezzee to propose an arrangement concerning the coexistence of their respective marks, PREZZEE and PREZZY, within the same industry. Prezzee declined the proposal, making it clear it would not accept any use of “Prezzy” by third parties in Australia and would actively oppose any attempt to introduce that brand into the Australian market.
In August 2025, Epay launched the “Giftzzy Card” in Australia in two formats, being a physical card sold through retail outlets and a virtual card available online. The product was promoted using the tagline “Powered by Prezzy Card”, which appeared on the face of the cards and on packaging and marketing materials.
Prezzee alleged that Epay’s conduct infringed its registered trade marks under section 120 of the Trade Marks Act 1995 (Cth) (the Act) by using “Prezzy” as a trade mark in connection with gift cards. Prezzee also alleged:
- Passing off; and
- Misleading or deceptive conduct in breach of the Australian Consumer Law.
Prezzee sought urgent interim orders restraining Epay from supplying or promoting the cards, and requiring removal of existing stock from circulation.
Epay’s response
Epay opposed the application, arguing that:
- The phrase “Powered by Prezzy” was not being used as a trade mark;
- Prezzee’s registrations did not extend to physical gift cards, but rather related to digital products and services;
- Consumers were unlikely to notice the phrase or be confused; and
- An injunction would cause disproportionate commercial harm, including the burden of retrieving approximately 47,000 cards from around 1,800 retail outlets.
The decision
The Federal Court found that Prezzee had established a sufficient prima facie case to justify interim relief.
In practical terms, the Court was satisfied that Prezzee had a real prospect of success at trial, and that urgent steps were necessary to prevent harm while the dispute progressed.
Key findings included the following:
- “Powered by Prezzy Card” was trade mark use.
The Court rejected Epay’s submission that the phrase was merely descriptive or background marketing language, even though “Giftzzy Card” appeared more prominently on the card.
It was found that the phrase operated as a badge of origin, meaning it conveyed a connection to the source or origin of the product, rather than being purely informational.
- Digital versus physical products was not determinative.
Although Prezzee’s core offering was digital gift cards, the Court accepted there was a serious question as to whether Epay’s physical gift cards were goods of the same description, or involved closely related services, for the purposes of section 120(2) of the Act.
- Confusion risk could not be dismissed.
Epay argued that consumers would overlook the words “Powered by Prezzy” because other elements of the branding were more prominent.
The Court rejected that submission, observing that the inclusion of the phrase on the card and packaging suggested it was intended to be noticed and understood, intentionally creating a mental association for consumers between the two brands.
However, the Court accepted there remained a serious question as to whether Epay could ultimately establish the statutory defence under section 120(2) of the Act, being that its use of “Prezzy” was not likely to deceive or cause confusion.
- Damages were not an adequate remedy.
The Court accepted that damages would not sufficiently protect Prezzee’s goodwill and reputation if infringement continued while proceedings progressed.
Balance of convenience
The Court found the balance of convenience favoured Prezzee.
While Epay argued that compliance would be expensive and disruptive, the Court placed significant weight on the nature of Prezzee’s trade mark rights and the risk of harm to goodwill if the conduct continued.
Notably, the Court rejected Epay’s position that it could not realistically notify retailers, observing that if Epay could distribute electronic payment communications, it could also distribute withdrawal instructions to retailers.
Orders made
Epay was ordered to:
- Cease supplying the relevant physical and digital gift cards;
- Notify retailers and distributors;
- Disable activation of the impugned cards where feasible; and
- Retrieve remaining stock from circulation.
Key takeaways
- Trade mark disputes can quickly shut down a product launch
This was an interim injunction, not a final trial decision. However, the commercial effect was immediate, including the withdrawal and recall of physical stock already distributed nationally.
Businesses should treat trade mark clearance and brand strategy as a core part of product risk management.
- A tagline can infringe
Even if a phrase is not the dominant branding on your product, it may still be considered trade mark use if it conveys a connection or association with another brand.
If your tagline borrows credibility from an established brand, it may create legal exposure.
- Non-compliance is expensive, and courts will expect businesses to act quickly
Once an injunction is made, compliance is not optional. Failure to comply can expose a business to contempt proceedings, penalties, further costs orders, and reputational damage.
This case is a practical example of how trade mark disputes can create urgent operational consequences, including costly product retrieval.
- If you can distribute a product nationally, you can recall it nationally
The Court was not persuaded by arguments that the logistics of notifying retailers and retrieving stock were too difficult or expensive. Operational inconvenience will not outweigh trade mark rights where there is a real risk of consumer confusion and harm to goodwill.
How we can help
If you would like guidance on trade mark compliance or protecting your brand, please contact a member of our Intellectual Property + Technology team.
For further information contact Managing Director Ben Gouldson.
The assistance of Lawyer Melanie Sharpe in researching this article is gratefully acknowledged.
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