Trade Mark Update - April 2018

Recent Australian Trade Mark Office decisions

Trade Mark Update: April 2018
Katherine Rock

It’s that time again when we provide a brief synopsis of some of the new and most interesting trade mark decisions handed down by the Australian Trade Mark Office (TMO). We report on the aspects of the case that we find most noteworthy, and not necessarily every aspect of the decision.

This month, we look at:

Trade marks: Foreign language and grammatical inconsistencies deemed not inherently adapted to distinguish

Conga Foods Pty Ltd [2018] ATMO 56 (19 April 2018)

Conga Foods initially applied to register their trade mark (detailed below) in the goods classes 29, and 30, specifying predominantly edible products such as meat, fish, milk, tea, coffee, and the like.

Trade Mark Application No. 1808100 (29,30)
Trade Mark: ASSORTI
Owner: Conga Foods Pty Ltd

The Examiner issued an adverse report on the grounds that the mark could not distinguish the applicant’s goods.  The Examiner’s reasoning was that “ASSORTI” is a French word which translates to “assorted” or “matching” in English.  A number of URLs showing the use of the term ASSORTED in relation to the above mentioned goods were cited.  Accordingly, the Examiner concluded that other traders should be able to use the word in connection with their own goods.  Conga Foods was unable to overcome subsequent adverse reports, and a hearing was convened.

Two-step test for determining ability to distinguish

In maintaining the Examiner’s objection to the application, the hearing officer referred to the two step test laid out by the High Court in Cantarella Bros Pty Ltd v Modena Trading Pty Ltd [2014] HCA 48 (3 December 2014).   The first step is to consider the ordinary signification of the sign in Australia to people likely to purchase/consume the goods.  The second step is to consider whether other traders may need to use the sign without improper motive.

Step 1: Ordinary signification in Australia

In determining the ordinary signification, representatives of Conga Foods submitted that the word “ASSORTI” was originally derived as an abbreviation for the Italian word “ASSORTITO”, meaning ‘assorted’.  And, they continued, while the word “ASSORTI” is a French word, its grammatical use in French differs significantly from the English use as trade mark.  For example, in French, assorted cheeses is translated as “FORMAGES ASSORTIS” (note also the plurality) whereas the mark would precede the noun, “ASSORTI cheese”.  Further, in the singular, the French word “ASSORTI” is interpreted as “matched” or “matching” rather than assorted.

Step 2: Would another trader need to use the mark?

The hearing officer accepted the Applicant’s arguments in this regard, however failed to be persuaded that ASSORTI would not be needed by other traders.  Conga Foods submit that without additional context, a trader is unlikely to want to use simply the French adjective “matched” or “matching” in a manner likely to infringe.  Their main point being that if the word were used as an adjective, it would not infringe ASSORTI if registered, as this would not be use as a trade mark, due to the inaccurate grammar between its use as a foreign descriptor and its use in a trade mark context.

The hearing officer disagreed, referring to hypothetical situations in which a trader may wish to display wines and cheeses with retail packaging stating “MATCHED”:

“[A hypothetical trader] may wish to have signs above their displays which read VIN ROUGE, VIN BLANC, FROMAGE BLEU, FROMAGE FRAIS, ASSORTI. The retail packaging in the ASSORTI section could bear the claimed ASSORTI trade mark. Given the ordinary signification of ASSORTI to French speakers, as meaning ‘matched’ or ‘matching’, the context means that the word is going to be seen as descriptive of the goods in connection with which it is used.” [16]

Thus, despite the grammatical inconsistencies highlighted by the application, the hearing officer maintained grounds for rejected under s41 of the Trade Mark Act.

Key takeaway – foreign language and grammatical differences not sufficient for distinctiveness

When applying for a trade mark, remember that the use of a foreign language translation is itself not sufficient to provide inherent adaptability to distinguish.  Further, this decision implies that grammatical inconsistencies between the usage of the mark in it’s native language, and usage in English as a trade mark, may not be sufficient to demonstrate ability to distinguish.

Trade Mark Use: Authorised use requires evidence of owner exerting “control” over user

Darley Stud Management Company Limited v Kevin Francis Darley [2018] ATMO 55 (18 April 2018)

This decision regards an opposition to an application for removal of the below trade mark, on the grounds of non-use.  The removal application was filed by Kevin Francis Darley, and this was opposed by the trade mark owner, Darley Stud Management Company Limited.

Trade Mark Application No. 952147 (44)
Trade Mark: DARLEY
Owner: Darley Stud Management Company Limited

Under Australian law, an application to remove a trade mark on the basis of non-use can be made it if can be shown that the mark has remained registered for a continuous period of three years ending one month before the day on which the non-use application is filed.

Should they chose to defend their mark, the opponent to a non-use removal application (i.e., the trade mark owner) bears the onus of showing the the trade mark has been used within the relevant period.

No use by the Trade Mark owner

The Opponent acknowledged that there had been no use of the trade mark by the owner, Darley Stud Management, directly in Australia during the relevant period.  Rather, the Opponent relies upon the use of the mark by an affiliated company, Godolphin, which they assert is part of the same corporate group, the Darley Group, and therefore an “authorised” user.

Was the use “authorised”?

While the hearing officer acknowledges that the stated use of the mark by Godolphin appears to be significant, in order to be relevant for the purposes of the opposition, the use needs to be consider “authorised use”.  The mere relationship between companies in a corporate group is not sufficient.

Section 8(1) of the Trade Mark Act states that:

“(1) A person is an authorised user of a trade mark if the person uses the trade mark in relation to goods or services under the control of the owner of the trade mark.”

Subsections 8(3) and (4) clarify that control includes quality or financial control.

The Full Federal Court discussed in Lodestar Anstalt v Campari America LLC [2016] FCAFC 92 (28 June 2016) the nature of what is considered to be control over financial or quality, including license agreement clauses detailing quality standard, or exercising financial control over trading activities.

The Opponent acknowledges that the agreement between Darley Stud Management and Godolphin was unwritten, and provides no evidence of terms of the unwritten license.  Accordingly, the hearing officer finds that there is insufficient evidence to establish that Godolphin was an authorised user, stating:

“A bare licence to use a trade mark, particularly a perpetual licence, would not be sufficient. Without more, it would amount to a divestment of control. ” [185]

Despite the above, the hearing officer is persuaded to exercise their discretion to maintain the mark on the register in the public interest, as removal would risk considerable consumer confusion.

Key Takeaway: If the owner of the trade mark is not the USER of the trade mark, clarify the (quality, financial) control the owner exerts in writing

Whilst this case may have been a lucky escape for the Opponent, in relying on the Registrar’s discretion, it highlights the importance of clarifying the relationship between a trade mark owner and its authorised user.  Authorised use requires financial or quality control.  Therefore, ensure written agreements are drafted to meet these requirements, as unwritten agreements, corporate affiliations, or bare licenses are unlikely to suffice.

Trade Marks: Mark within a mark

Energy Beverages LLC v M.D Visage Pty Ltd [2018] ATMO 53 (16 April 2018)

This decision concerns an opposition by Energy Beverages LLC, a subsidiary of the Monster Energy Company, to the registration of the following trade mark:

Trade mark application no. 1660034
Filing Date: 21 November 2014
Trade Mark: ProBurn
Goods/Services: Classes 5, 18, 21, 25, 29, 30, 32

In particular, the Energy Beverages nominated two grounds of opposition, namely s44 that deceptively similar marks existed on the register, and s59 that the applicant was not intending to use the trade mark in relation to the goods/services specified.

Deceptive similarity

Energy Beverages cited the following registered marks (of which, it is the registered owner), in support of their first ground of opposition:

Trade Mark No: 843738 (32)
Trade Mark: BURN

Trade Mark No: 1526464(32)
Trade Mark: BURN

Trade Mark No: 1563602(32)
Trade Mark:

Trade Mark No: 1547231(32)
Trade Mark:

2018_5301.jpg

 

 

 

 

In order to establish deceptive similarity, the hearing officer acknowledged, among other things, the similarity of the goods and services of the respective registered marks, and some of the Applicant’s application.

Turning to whether the mark, ProBurn, is deceptively similar to the abovementioned marks, the hearing officer looked to s10 of the Trade Mark Act which defines deceptively similar as:

” For the purposes of this Act, a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.”

Such a comparison involves, not a side-by-side comparison, but one of an impression based upon recollection.   Where the registered marks above include the word “Burn” alone, the hearing officer states that this is “plain that it is the impression that a person of ordinary intelligence would have” of these marks.  Continuing, it was found that the addition of “Pro” did not dilute the prominence of the word “Burn” in the Applicant’s mark.  Accordingly:

“… the common element in all of the trade marks, namely the word ‘burn’, may induce traders and the public into believing the Trade Mark and the Opponent’s Trade Marks emanate from the same trade source. As such, I am satisfied that the Trade Mark is deceptively similar to the Opponent’s Trade Marks.” [41]

While the case for s44 objection was made in respect of some of the goods and services in respect of the application, the hearing officer provided the Applicant the opportunity to narrow the specification in order to remove the rejected classes from the specification.  As no response was timely received, the trade mark was rejected.

Key takeaway: Is a mark within a mark registerable?  Answer: It depends.

In this case, the applicant’s mark was considered deceptively similar due to the presence of a registered mark “Burn” within the applied for mark “ProBurn”, but this is not always the case.  Key to the decision was the likelihood of deception, including a consideration for all surrounding circumstances, including:

  • prominence of the registered mark within the mark;
  • the dilutive effect (if any) of additions to the registered mark;
  • goods to which they are applied;;
  • nature and kind of customer likely to buy the goods
  • what is likely to happen if both the marks are used in the normal way;
  • etc…

Got questions or need advice?

Simply get in contact or give us a call if you have any question regarding trade marks.

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