The word yellow is descriptive of online directories

Telstra has lost its appeal in the “Yellow” case.

The Full Court upheld the trial judge’s conclusion that the word “yellow” lacked any capacity to distinguish print or online directories under (the old version of) s 41. However, the Full Court accepted that the word “yellow” had become sufficiently distinctive of Telstra by reason of use and promotion after the date of the application that it would have been registrable if it had had some inherent capacity to distinguish.

Following the High Court’s ruling in “Oro/Cinque Stelle“, the Full Court agreed with the trial judge that the word “yellow” signifies the colour yellow and the evidence showed that the colour yellow signified print and online directories. Consequently, the word itself was descriptive. At [117], in considering the ordinary signification of the word, the Full Court said:

We would say at the outset that it was appropriate for Telstra to proceed on the basis that capacity to distinguish could not be decided by reference to inherent adaption alone even if the Court accepted all of its arguments. The word yellow describes a colour and, even without evidence, it would be appropriate to infer that at least some other traders might wish to use that colour. Furthermore, there was at the very least evidence in this case of not infrequent use of the colour yellow in connection with print and online directories.

The Full Court then considered that the evidence of use by other traders in print and online directories confirmed that consumers did in fact consider the word “yellow” descriptive of such directories. Like the trial judge, the Full Court took into account the usage of traders overseas as well as within Australia, although it may have been to support the good faith of the local traders’ use.

Survey and acquired distinctiveness – s 41(5)

If the word “yellow” had had some capacity to distinguish print and online directories, the Full Court would have allowed Telstra’s appeal that it had become sufficiently distinctive under s 41(5) by use after application. A 2008 survey (not the 2007 survey relied on by the primary judge) showed that after several years of use including millions of dollars of expenditure on advertising, at least 12% of the survey respondents identified (associated?) the word “yellow” with Telstra’s directory unprompted. A further 4%, making 16% in total, had similar unprompted association.

The Full Court distinguished British Sugar and held that would be sufficient. (The report does not disclose the terms of the question that elicited those responses.) Arguably, makes a nice contrast to the Oro/Cinque Stelle case.

What about .com.au

In dismissing a second, cross-appeal in which yellowbook.com.au was found to be deceptively similar to Telstra’s Yellow Pages trade mark, the Full Court treated the domain name “accoutrement” .com.au as largely insignificant for the purposes of the deceptive similarity analysis.

The interesting point here is that the Full Court considered this may not always be the case. It was appropriate to disregard the element here in the context where the services were online directories and consumers were shown largely to disregard such elements.

The question of onus

The Full Court also seems to have resolved the ongoing disputes about the onus of proof. The Full Court held that the opponent has the onus of proving that a proposed trade mark has no inherent capacity to distinguish. It further held that that onus was on the balance of probabilities, not the practically certain standard which some courts at first instance have applied.

Telstra Corporation Limited v Phone Directories Company Australia Pty Ltd [2015] FCAFC 156 (Besanko, Jagot and Edelman JJ)

A coffee free-for-all and a trade mark cancellation

Last month, the Full Court overturned the trial Judge’s ruling that Modena had infringed Cantarella’s registered trade marks for ORO and CINQUE STELLA for coffee. Instead, revoking the registrations on the basis that they were not capable of distinguishing. Barrister Sue Gatford provides another guest post explaining why.

In 2000 Cantarella, the vendor of Vittoria coffee, applied for and obtained registration in Australia and elsewhere of the Italian words ORO and CINQUE STELLE as trade marks. Translated into English ORO means GOLD and CINQUE STELLE means FIVE STAR. Cantarella had used these words (and others) in Australia for various of its coffee blends for a very long time.

An Italian company, Molinari, had used ORO and CINQUE STELLE for its coffee for a similarly long time, and since 1997 had imported that coffee into Australia. Many other coffee companies, including Lavazza and Coffee Mio, use ORO to describe one or more of their coffee products. On the evidence, no-one other than Cantarella and Molinari appear to have used CINQUE STELLE.

In 2011 Cantarella sued Modena, Molinari’s Australian importer. It alleged that the Café Molinari Oro and Café Molinari Cinque Stella products that Modena imported and sold in Australia were infringing Cantarella’s registered trade marks. The Federal Court initially agreed. Last month though, the Full Court overturned that decision and ordered the cancellation of Cantarella’s trade marks.

The judgment revisits the long standing and often quoted test, set out by Kitto J in Clark Equipment, for determining when a mark is inherently adapted to distinguish, viz:-

[T]he question whether a mark is adapted to distinguish [is to] be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives — in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess — will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it.[1]

In Clark Equipment registration of the word MICHIGAN for tractors that came from Michigan, USA was refused. The High Court considered that as Michigan was a well known manufacturing centre at a later time other traders might, without improper motive, want to use the word Michigan in describing other tractors they wanted to sell.

Similarly, the Full Court said that Italy being a common source of coffee and the Italian language having invaded the English language in the coffee sphere with words such as cappuccino, cafe latte and the like, it was likely that other traders would, without improper motive, be likely to want to use descriptive Italian words, including ORO and CINQUE STELLE, in relation to their coffee.

The Full Court considered that the trial judge put too much emphasis on the fact that Australian consumers generally (the so called “ordinary English-speaking people in Australia”) were unlikely to know what ORO and CINQUE STELLE meant. Rather, the Court said, the proper enquiry was whether other traders would want to use those words. The Full Court was less concerned than the trial judge with whether the English meaning of the words was widely understood (How many people who order a cappuccino know what the word cappuccino means in English?) but did point out that Italian was the second most widely spoken language in Australia in any event.

In terms of the appropriate legal test, the Full Court said that the reference to “the common right of the public” by Kitto J in Clark Equipment was a reference to the common right of other traders as a sub-section of the public.[2] Crucially, they found that the evidence supported a finding that ORO and CINQUE STELLA were:-

“known in the coffee trade according to their ordinary signification as words descriptive of the quality of coffee products and have been used in that sense, although not as trade marks, for a significant period of time extending well before Cantarella’s registration of its marks and afterwards”.[3]

Interestingly, the Court did not differentiate between the evidence of the use by other traders of ORO (there were many) and the evidence as to the use by other traders of CINQUE STELLE (there were none). This is perhaps because the test is what other traders might want to do, not what they have actually done. So while proof of actual use is convincing proof of a (fulfilled) desire to use, an absence of actual use is equivocal – it may just mean that other traders haven’t as yet decided to use the particular word or words, not that they won’t ever decide to use them.

So it would seem that the Australian coffee world can resume use of the descriptive splendour of the Italian language without fear of trade mark infringement for the time being. The Clark Equipment test as clarified by the Full Court in Modena is also alive and well.

Modena Trading Pty Ltd v Cantarella Bros Pty Ltd [2013] FCAFC 110 (Mansfield, Jacobson & Gilmour JJ)


  1. Clark Equipment Company v Registrar of Trade Marks (1964) 111 CLR 51 at 514.  ?
  2. Modena at [74].  ?
  3. Modena at [97].  ?