Earlier that year, US lawyers for Perry had sent a “cease and desist” letter to Taylor in a bid to stop the designer’s application for registration of her trademark.

“Ms Taylor rejected that offer of a coexistence agreement, which, as circumstances turned out, would have been an excellent outcome for both parties,” the judgment said.

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“[Having] rejected the offer, Ms Taylor then chose to commence infringement proceedings … In that sense, Ms Taylor has brought this result on herself. Unfortunately, it is no longer possible to return to the time of peaceful coexistence.”

The Full Court granted a limited stay to prevent the trademark cancellation order from taking effect until the outcome of any High Court appeal process. Taylor, who is also facing a hefty costs order, does not have an automatic right of appeal and would need to apply for special leave.

Taylor told The Sydney Morning Herald: “I am devastated with the outcome of the case. I won my case at first instance and to have it overturned on appeal is heartbreaking.

“This case proves a trademark isn’t worth the paper it’s printed on. My fashion label has been a dream of mine since I was 11 years old, and now that dream that I have worked so hard for since 2006 has been taken away.

“I will take some time to digest today’s decision and work out my next steps with my legal team and circle of supporters.”

In a decision in April last year referencing one of the singer’s best-known hits, Justice Brigitte Markovic had said: “This is a tale of two women, two teenage dreams and one name.”

Delivering a partial victory for Taylor, Markovic said Perry had infringed Taylor’s “Katie Perry” trademark in a series of tweets and Facebook posts between 2013 and 2018 when she promoted Katy Perry merchandise available in connection with her Prismatic world tour, Cozy Little Christmas hoodies, T-shirts, sweatpants and scarves, and pop-up stores.

The judge also found Perry’s company, Kitty Purry, was liable along with tour merchandise company Bravado for infringing Taylor’s trademark in advertising and selling Katy Perry clothes during the Prismatic tour’s Australian leg, at Sydney and Melbourne pop-up stores, and on the Bravado website.

But the appeal court found Taylor’s trademark infringement claim could not succeed and set aside a raft of orders made in May last year.

The law firm acting for Perry in Australia declined to comment.

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