Yates J has rejected Apple’s attempt to register APP STORE in Australia as a trade mark for retail store services featuring computer software provided via the internet or for use on handheld mobile devices and the like.
Apple applied to register APP STORE in Australia on 18 July 2008 for retail store services featuring computer software […] in class 35 and related services in classes 38 and 42, TM App No 1252301. The application claimed Convention priority from 7 March 2008. Apple’s “App Store” launched in Australia on 11 July 2008 – that is, one week before the application was filed – with the release of the iPhone 3G. The Registrar rejected the application on the grounds that the trade mark lacked any inherent capacity to distinguish and, there having been no use prior to 11 July 2008, it was not factually distinctive of Apple as at the claimed Convention priority date.
Yates J, as noted, has rejected Apple’s “appeal” on the basis that APP STORE is not capable of distinguishing the services specified in the application. As one would expect, his Honour’s decision provides an excellent tutorial on how one should approach questions arising under s 41 including, apart perhaps from questions of onus, the new form.
The relevant date
Yates J held that capacity to distinguish fell to be assessed at the filing date of the application not, as the Registrar contended based essentially on s 72, on the priority date applicable as a Convention application. This was potentially significant as there had been no use of the trade mark at the priority date, but there had been at least one week’s use at the filing date.
Capacity to distinguish
Yates J began by pointing out that whether something has inherent capacity to distinguish depends on the occasion and circumstance. It turns on both the nature of the particular mark itself and also the nature of the particular goods or services specified in the application.
To overcome the Registrar’s rejection, Apple relied on evidence from a linguistics expert, analysis of internet usage on Google Trends and in the Internet Archive and a Newspoll online survey
Apple’s primary argument was that the expression “app store” could not be fully understood by simply combining the meanings of its component parts “app” and “store”. At :
…. In other words, the combination “app store” does not have a “compositional” meaning. According to him, “the compound APP STORE can only be fully?understood non?compositionally”. ….
The argument here was that, while the term “app” had been used as “clipped” form of application since 1985, that usage was restricted to specialised computer circles. In addition, the word “store” meant a physical place where one went to buy goods or services: Apple’s App Store introduced a new meaning: an online, virtual “place” where one did not so much buy things as a “licence” to use software. That is, in more traditional terms, the expression is at best “allusive” rather than directly descriptive.
On the evidence, however, Yates J found that both “app” and “store” had relevantly well-understood descriptive meanings in the relevant sense for the general public at the filing date. There was evidence at  –  that before the filing date “app” had been used in 83 articles in publications such as PC World, Technology Review, Rolling Stone and Atlantic Monthly to refer to software applications running on PCs in the Windows environment. At , his Honour found:
well before 2008, the word “app” had a well-established and well-understood meaning as a shorthand expression for computer software that is application, as opposed to operating, software. I do not accept that, at the filing date, this use of the word was restricted to computer experts. I am satisfied that it was the received meaning for many interested users of computer software and certainly for those involved in the trade of supplying computer programs, including by retail.
and at :
I am not persuaded that the word “store”, as used in APP STORE, ushered in a new meaning of that word. On the evidence, I am satisfied that, at the time that Apple applied for the APP STORE mark, the word “store” had a well-established and well-understood meaning among traders and the general public that was not confined to the traditional notion of a physical store, but extended, as well, to an online store for the provision of goods or services.
His Honour gave as examples Amazon.com’s launch of its e-Books store in 2000, its software download store launched in 2001 and Apple’s own iTunes Music Store launched in 2003.
Consequently, his Honour concluded that members of the public seeking to acquire application software at the filing date would have understood APP STORE to be no more than a description of a trade channel. It had no inherent capacity to distinguish:
I am satisfied on the balance of probabilities that, at the filing date, members of the public seeking to acquire application software would have understood APP STORE as no more than an expression to describe a trade channel – a store – by or through which application software could be acquired. The fact that the “acquisition” would have involved the acquisition of rights by way of licence does not, in my view, bear upon the matter.
Even if Apple was the first to use the combined expression, which Yates J does not seem to have been convinced it was, “the words in combination bore no more than their ordinary signification when applied to the designated services in Class 35.”
While his Honour drew on the Full Federal Court’s ruling in Oro / Cinque Stelle overturned by yesterday’s ruling in the High Court, these factual findings of what the terms and combined expression would mean to members of the public, unless somehow overturned, would appear to be fatal to any appeal.
Acquired distinctiveness (secondary meaning)
Yates J considered the evidence on acquired distinctiveness “opaque”. There was no real evidence about how the press releases issued with the launch of the store were used or of any other advertising or promotional steps undertaken. His Honour was prepared to accept that people had done internet searches in the week following launch of the term “app store” and “perhpas many persons” had come to associate the App Store service with Apple, but that was not enough.
The Newspoll survey
The Newspoll survey was drawn from an online pool of people who were willing to participate in market surveys for reward. It disclosed that some 65% of participants associated the term “App Store” with a particular company or brand and at least 88% of those nominated Apple as the company or brand. There were at least 2 main problems with this survey. First, it was conducted in 2011 – 3 years after the relevant date – “well after the relevant period” at . Secondly at  – , applying cases like Woolworths v BP and Chocolaterie Guylian, it was not enough to demonstrate that the expression APP STORE was associated with Apple; it was necessary to show the nature of that association was to identify the trade source of the product – i.e., as a badge of origin.
The ‘pro-active’ role of the Registrar
Apple criticised the active role the Registrar took in this case: going to the lengths of filing her own expert evidence in answer to Apple’s expert and relying on affidavits provided by solicitors acting for Microsoft. Such an active role is indeed unusual in such appeals. Yates J, however, did not accept that the Registrar’s role could fairly be described as “partisan”. His Honour pointed out that the Registrar is entitled to appear as a party and what role she should take when doing say would depend on the circumstances of particular cases:
In the present appeal, a large body of evidence, including expert evidence, was adduced by Apple. The Registrar was not bound to accept either the completeness or the correctness of that evidence. If, as here, there was a genuine alternative case available on the facts or evidence which materially qualified the case brought by Apple, then that alternative case could only be advanced by evidence adduced by the Registrar in the appeal, including by way of expert evidence, bearing in mind the nature of the proceeding as a hearing de novo. I do not think that the Registrar should be criticised for advancing a case for the Court’s consideration. To deny the Registrar that opportunity would be to deny the Court the opportunity to make findings on an appropriately-informed basis. This is not to encourage the Registrar, as a party to such an appeal, to make the case before the Court more factually complex or extensive than it need reasonably be or to take other than appropriately measured steps in the conduct of the litigation. Quite clearly, appropriate judgment must be exercised in considering what evidence is truly necessary, and what forensic decisions should be taken, to fulfil the Registrar’s role, which must be to take reasonable steps under the Act to protect the public interest in respect of the registration of trade marks in Australia. I do not think that the Registrar has over-stepped the mark in this case. ….
Apple Inc. v Registrar of Trade Marks  FCA 1304
- This too was decided under the “old” form of s 41 not the new form introduced by the [Raising the Bar Act][rtb]. ?
- Although not referred to specifically by his Honour, this is well illustrated by “North Pole” in respect of “bananas” in contrast to, say, “Whopper” in respect of hamburgers. ?
- There was considerable variation among age groups: 90% of those aged 18 to 34, 81% of those aged 35 to 49 and 60% of those aged 50 to 64. ?