The Committee noted the submissions about possible breaches of TRIPS, the Paris Convention, the Constitution etc. and said at [1.63]:
While the Committee recognises that there are … complex legal issues relating intellectual property and trade marks, it considers these issues to be beyond the purview of a Committee formed to consider matters directly related to health and/or ageing. Therefore the Committee has decided to confine its comments to evidence relating to health implications of the legislation. ….
The Full Court (Greenwood and Tracey JJ, Buchanan J dissenting) has upheld Bodum’s appeal from Middleton J’s finding that the Euroline product was not likely to misrepresent an association with Bodum or its Chambord coffee plunger.
Now, due to my involvement in the other case (which was not appealed), I cannot say much about this.
I will draw your attention to Greenwood J’s finding that Bodum did in fact have a reputation (but not a monopoly see [266]) in the features of the coffee plunger alone, divorced from its branding insignia.
192 The advertising material is vast. It has endured over a long period. It is reinforced by substantial sales of the product. The reputation for the product by reason of its aesthetic features reflected in the pleaded elements of the shape of the product, is very significant. The presence of the bodum® trade mark operates to reinforce the association in the mind of consumers or potential purchasers between the distinctive product and its maker which is established by the reputation subsisting in the features of the product itself.
….
194 Two examples (among many) speak loudly to the independent or secondary reputation in the features of the product at approximately each end of the chronological spectrum. The first is the feature article as early as 17 June 1986 addressing the coffee-drinking behaviours and coffee preferences of consumers, in the Good Living section of The Sydney Morning Herald which depicts as the signature image for the article a large Bodum Chambord Coffee Plunger standing next to a mound of coffee beans. Presumably, the publishers of the article in that section of the newspaper thought that consumers would immediately identify with the image. The second is the front page of the 2008 Myer Christmas Catalogue. In that catalogue Myer placed the Bodum Chambord Coffee Plunger at the apex of the Christmas tree of products presumably on the footing that consumers ready to engage in purchase transactions in the Christmas retail cycle would identify and associate with the products on the cover of the catalogue including, for present purposes, the Bodum Chambord Coffee Plunger.
195 What further evidence could be needed of a significant independent reputation in the features of the product itself connecting consumers with the maker of the product (even if the name of the maker may not readily be called to mind) although, in fact, the promotional material is, as found, vast.
196 As to the distinctiveness of those features, there is no evidence which suggests that the features of the Bodum Chambord Coffee Plunger are simply generic features. There are many different coffee makers which exhibit many different shapes. The evidence within the advertising material contains many images of different styles of coffee makers. Moreover, the primary judge found at [120] that although copyists had entered the market from time to time, the presence of copyists had not diluted Bodum’s reputation. Rather, it “would have had the inverse effect” having regard to the factors mentioned by the primary judge at [120].
197 I am satisfied that the evidence establishes a very significant secondary reputation in the features of the Bodum Chambord Coffee Plunger associated in the mind of consumers with Bodum as the manufacturer of the product and, with respect to the primary judge, that reputation is not “distinctly tied” to Bodum in the sense that in the absence of the name Bodum there cannot be a secondary reputation in the features of the product. The primary judge considered that Bodum, like Mars Australia Pty Ltd, had become “a victim of its own success” by so heavily promoting its distinctive product in conjunction with its trade mark, Bodum, that in the absence of the mark, no potential purchaser would be, or would be likely to be, misled into believing that a rival product is a Bodum Chambord Coffee Plunger. Care should be taken in applying this notion as a general principle. As a conclusion on the facts in the case of the Maltesers get-up, the highly stylized and dominant word Maltesers as the principal component of the get-up emblazoned on the box of the confectionary product meant that purchasers of similar confectionary would not think a rival boxed product not exhibiting the highly stylized Maltesers mark was a box of Maltesers. However, it should be remembered that the product in question was a boxed product in which the confectionary could not be examined by a potential buyer independently of its packaging.
You should also note the importance his Honour placed on (a) the absence of product branding on the Euroline product itself and (b) the generic or descriptive and unknown nature of the branding that it did have. For example:
244 It seems to me that the adoption on the box of a non-distinctive and descriptive trade mark Euroline for a rival product which for all practical purposes embodies all of the features (that is, copies those features) of the product exhibiting the pronounced and substantial reputation at July 2004 of the Bodum Chambord Coffee Plunger, is not sufficient to distinguish the rival product from the distinctive product sought to be copied. This is especially so as the rival product and the Bodum product are regularly displayed outside the packaging for each product notwithstanding that it may be that the products are displayed in stand-alone fashion, proximately located to the packaging and in some locations in front of the boxes. It would have been a simple matter for DKSH to mark its name prominently on the box or mark its trade mark and product name prominently on the rival product itself (or at least as prominently as Bodum marks its product) or both. A plainly distinctive differentiating trade mark might also have been selected for use on the box and on the product.
245 An inference is open that at July 2004 DKSH’s get-up of its product was such as to lead consumers to believe, or be likely to lead consumers to believe, that when they engaged with the rival product they were actually engaging with Bodum’s product or a product in the Bodum line of products even if they saw the words Euroline on the box when engaging in the sequence of steps leading up to selection and purchase of a coffee plunger. If they did not see the box and were drawn to the rival coffee plunger by reason of the distinctive features of the Bodum product, a consumer might well pick up the rival product and handle and examine it, and if a potential purchaser did so, there is no indication from DKSH on the product itself that the consumer was not looking at a Bodum product or a product in the Bodum line of products, but looking at a DKSH product.
246 The references in the primary judgment to the association between the distinctive features of the Bodum product and the use of Bodum’s name and logo inverts the real question to be addressed. A consumer looking specifically for the Bodum Chambord Coffee Plunger by reference to the name Bodum could pick up the Bodum product as displayed out of its box, hold it (as put in cross-examination – even at arms-length in the right hand) and see the Bodum name and trade mark. That might well be so for a consumer looking for the product specifically by name because they know the product by name. They may be replacing a Bodum product they already own; or they may have seen the product closely in particular settings at a restaurant, in a home or in many other settings which attracted their attention to its features and the Bodum name as well as the features. The real question is what impression is made on the mind of the reasonable or ordinary member of the class of consumers seeking to buy a coffee plunger (rather than sophisticated members of the class, which applies a more stringent and incorrect test) drawn to the rival product by reason of the copying of the distinctive features of the Bodum product and conscious of the reputation associating the product distinctly with Bodum (although the name might not be immediately recalled), when such a consumer examines the rival product without any differentiating name, title or logo on the product at all to signify that it is not actually a Bodum product. As a matter of impression, it seems to me entirely rational to conclude that such a member of the class is very likely to think that the largely indistinguishable product embodying those features (as DKSH chose to do) is the Bodum product, a version of the Bodum product or in some way sponsored or approved by Bodum. The only step taken by DKSH to differentiate its product is the placing of the Euroline name on the box for the product. The instruction sheet as to safe use of the product does not reasonably tell a potential purchaser that “this is not a Bodum coffee plunger”.
Note in particular that the branded leaflet inside the product itself was inadequate.
Note also there was not a marketing expert or a parade of consumers anywhere to be seen.
Parkdale v Puxu was distinguished on its facts at 254 – 257. Philips v Remingtonand Dr Martens were distinguished as the products themselves were labelled in the appropriate places (and the rival traders’ marks were well-known).
Greenwood J put to one side arguments about “impulse purchase” products being the subject matter of cases such as Jif Lemon and Red Bull :
262 It seems to me to be an error of principle to simply put cases such as Red Bull and Apand to one side as purely “impulse purchase” cases in the circumstances of this case. Those cases at least raise for proper analogical consideration the question of whether the use of a label on the rival product itself (or packaging for a product) aided, in context, in distinguishing a rival product from the product it closely resembles whether by features of shape or other distinctive get-up. In similar terms, the adoption of the trade name REALEMON on the rival get-up for the rival product in Reckitt & Colman Products Ltd v Borden Inc. (Schedule 16) was not enough to establish differentiation for the rival product from the distinctive lemon get-up of Borden’s product.
Mitre 10 has been refused an interlocutory injunction to stop “Masters” using a blue, white and grey get-up for a hardware store. Macaulay J was not persuaded there was a serious question to be tried and, even if there were, the damage to “Masters” resulting from an injunction far outweighed the damage to Mitre 10’s goodwill if no injunction were granted.
His Honour itemised a number of reasons why the claim did not rise to a prima facie case. The main reason was that Mitre 10 was trying to argue that the colour scheme adopted by “Masters” would misrepresent an association with Mitre 10. The problem with that was that both rivals’ get-up included plastering their respective brand names and logos on their get-up. That created a real difficulty when, apparently, other hardware stores unrelated to Mitre 10 used a similar get-up. At least at the interlocutory stage, Mitre 10’s evidence apparently showed that less than half its stores had adopted the get-up in which reputation was now claimed.
You can get a bit of an idea of the competing get-ups from Mitre 10’s homepage and Masters’ homepage (or even better (or worse) try here).
Mitre 10 Australia Pty Ltd v Masters Home Improvement Australia Pty Ltd [2011] VSC 343
You won’t have heard of Masters yet: it isn’t scheduled to start trading until September or October. Apparently, it is a joint venture between Woolworths and Lowe’s from the USA and, of course, Woolworths’ main competitor just happens to own Bunnings.
Back in the “good old” days, we used to bring actions for passing off in the State Supreme Courts. Then, we worked out that by bringing a counterpart claim for misleading or deceptive conduct, we could go play in the Federal Court. Recently, the Federal Court has not been so kind to straight get-up claims (Bodum and Maltesers and Nutrientwater). This resort to the old State court has not led to any different outcome at this stage.
Of course, there have been cases where the interlocutory injunction was lost but the plaintiff ultimately succeeded at final trial.
Download the text of the Bill and EM from here (choose your own format).
You will remember that (according to the Press Release) the main objects of the Bill include:
raising patent standards to ensure Australian innovators are well placed to take their inventions to the world;
increasing penalties for trade mark counterfeiters;
improvements to border security measures for goods that infringe copyright and trade marks;
providing free access to patented inventions for researchers; and
cutting red tape and delays when seeking an IP right.
While there have no doubt been modifications to the text of the Exposure Draft (and Patentology flags a big change to the transitional provisions for the new patentability standards), you can get a very good feel for what the various parts of the Bill are trying to achieve:
in relation to patents from Dr Summerfield’s 8 part series over at Patentology:
Kim Weatherall also commented on a number of aspects, exploring in particular the (proposed) trade mark criminal offences.
You do need to bear in mind that these commentaries were on the text of the Exposure Draft and it was intended that anomalies identified through the Exposure Draft would be corrected in the Bill so, as I have already noted, there will be changes. Nonetheless, these comments should give you a good fell for what was being intended and issues that might be thrown up.
As you will see from the commentaries on the exposure draft, there are a host of issues to be considered. Time doesn’t permit anything but a cursory attempt on a couple of points here:
Item 113 of Sch 6 will replace the current s 41 of the Trade Marks Act (requiring a trade mark to be capable of distinguishing) with a new provision intended to reverse Blount and ensure that there is a presumption that a trade mark is registrable. It does this by requiring the Registrar to be satisfied that the trade mark is not capable of distinguishing before the Registrar can reject the application on this ground.
So clause 41(2) says “A trade mark is taken not to be capable of distinguishing … only if ….”
(Now I look at it, I wonder how long before it will be before someone tries to argue that “taken not to be capable of distinguishing” means something different to (and less than) “is not capable of distinguishing”. Oh well. Surely that one would be dispatched over the fence for six?)
While the Bill does seek to change the standard of proof against patent applications and patent oppositions from the existing “practically certain to fail” or “clear” type standard to the usual “balance of probabilities (see e.g. items 14 and 15 of Sch 1), no such amendment is proposed for trade mark oppositions. Therefore, the current state of uncertainty on this issue will continue (contrast e.g. Hills v Bitek at [43] – [55] to Sports Warehouse v Fry at [26] – [40]) , even though the school of thought favouring the “practically certain” or “clear” standard was imported from the Patents Act.
The bill will also introduce a whole new regime of oppositions to the registration of trade marks.
Item 18 of Sch. 3 will replace s 52 so that there is an obligation to file a Notice of Opposition which the Registrar, not the opponent, will serve on the applicant. Item 19 will introduce a new s 52A. This will require an applicant to file a notice of intention to defend or the application will lapse.
According to the EM, the regulations (when they are promulgated) will include power for the Notice of Opposition to specify the particulars of the grounds of opposition. The EM explains:
Opponents are currently required to state the grounds on which they intend opposing an application when they file their notice of opposition. However, they are not required to set out the particulars of those grounds. Frequently, this means that the opponent sets out all possible grounds, whether or not they have any intention of relying on them. As a result, the trade mark applicant may be faced with a number of grounds to deal with and no indication of which are key to the opposition until late in the opposition proceedings and sometimes not until the hearing
makes it difficult for the applicant to prepare their case. It also increases costs as the applicant is obliged to prepare a case in response to all grounds raised in the statement of grounds, including those on which the opponent may no longer rely.
The amendment addresses this problem by allowing for regulations to be made to require the opponent to file a statement of particulars of the grounds on which they intend to oppose. This will help focus oppositions earlier, reducing costs and unnecessary effort for the applicant.
The EM talks of the regulations conferring a power to require particulars. Whether this will be a discretionary power to be exercised on a case by case basis or an obligation on all opponents will need to await the terms of the regulations themselves. For example, the EM on items 24 and 25 states that opponents will be required to file both statements of grounds and particulars and the last paragraph of the EM on item 17 states that the particulars will be required to be filed within 1 month of the filing of the Notice of Opposition.
The regulations will also apparently include a power to amend the statement(s) of grounds and particulars. However, the EM on items 24 and 25 states:
The regulations will only permit the opponent to amend the statement of grounds and particulars under tightly controlled circumstances.
The Federal Magistrates Court will get original jurisdiction in matters under the Designs Act and the Trade Marks Act alongside its existing original jurisdiction in copyright and (what used to be called) trade practices matters.
For completeness, I should note that IHC UK has appealed Logan J’s decision earlier this month finding that it infringed IHC Australia’s registered trade mark for AFFINAGE. Summary here.
Interestingly, Logan J has granted a stay of his order to remove all references to A.S.P. from IHC UK’s Web site at www.affinage.com.
You will recall that IHC UK owns AFFINAGE outside Australia and had adopted A.S.P. at least partly to deal with the fact that it could no longer use “its” trade mark in Australia.
Logan J appears to have considered a stay pending the outcome of the appeal was in order as IHC UK:
Had removed all references to Australia (including the drop down country box) from its web site at www.affinage.com;
IHC UK was having some sort of global re-launch of A.S. P. in the UK soon, involving 150 or so distributors from around the world;
His Honour accepted that the decision that the modified Web site infringed had been a “difficult one”; and
IHC Australia had not sought damages and it was difficult to identify what damages might flow from the stay.
His Honour did not think that he needed to order a stay of 7 days of his orders relating to the removal of references to Australia from www.affinage.com. That stay had been sought out of an abundance of caution and IHC UK was generally trying to comply with the orders so it appeared a breach, if any, would have been inadvertent.
International Hair Cosmetics Group Pty Ltd v International Hair Cosmetics Limited (No 2) [2011] FCA 540
For the orders under appeal, see International Hair Cosmetics Group Pty Ltd v International Hair Cosmetics Limited [2011] FCA 339
Logan J has granted injunctions against International Hair Care UK’s use of AFFINAGE (and other trade marks) on its global website for (in effect) infringing International Hair Care Australia’s trade marks registered in Australia. The facts throw up the interesting question of what happens when 2 different people own the same trade mark in different countries and try to use it on the internet.
Facts
IHC UK is the owner of the registered trade mark AFFINAGE for hair care products in the UK and 20 other countries throughout the world, but not Australia.
In 1992, Mr Barry, the principal of IHC UK, set up IHC Australia with Mr Jolly. At that time, Mr Barry owned a majority of the shares.
IHC Australia applied for and registered AFFINAGE under the Australian trade marks act for hair care products.
In 2002, Mr Barry sold his then remaining shareholding in IHC Australia to Mr Jolly (and his wife) for $480,000. IHC Australia kept its registered trade marks and, under the terms of the sale, the parties divided up the global rights between themselves. IHC Australia got the rights to AFFINAGE in China, South-East Asia, Australia, New Zealand and the South-West and Western Pacific to the International Date Line; IHC UK had the rights to the rest of the world.
Sometime after this, Mr Barry or IHC UK incorporated a new Australian company, Affinage Salon Professional Pty Ltd, to sell hair care products under the brands A.S.P. and KITOKO.
In August 2010, the parties started legal action in Australia against each other. That litigation was compromised by a deed of settlement the terms of which, amongst other things, included Affinage Salon Professional agreeing to change its name so that it did not include AFFINAGE and IHC UK and its subsidiary undertaking:
not to use AFFINAGE … as a sign in connection with the importation, marketing, sale or manufacture in Australia of hair care products including hair colours and dyes.
In January this year, IHC Australia’s solicitor did a Google search and went to the link for IHC UK’s website at www.affinage.com. At that link, he was presented with a banner AFFINAGE and beneath it in smaller script SALON PROFESSIONAL. There was a “country box” with a drop down list of countries. When he selected “Australia”, he was taken to a page headed “ASP”. Under the “Profile tab” for Australia, there were the following passages:
In 1996 [IHC UK] conceived, created and lunched the premium hair care brand AFFINAGE. Originated as a line of hair colour, the AFFINAGE brand grew rapidly to include [reference to other types of product]… Now we are introducing our exciting new hair care brand, ASP, to the Australian and Asian markets. Having already signed distribution agreements with a number of companies we look forward to fantastic success in 2011.
….
Today our products are sold in over 50 countries – across Europe, Africa, the United States, South America and the Asia Pacific. Our brands are marketed globally by [IHC UK] and through it’s associated companies in the USA and Australia. Global distribution is achieved through a worldwide network of wholesalers and specialist distributors
A map of the world showed markers ASP Australia, ASP USA and identified the UK as Worldwide HQ. If the UK or the USA were chosen, the same information was displayed, but the landing pages were headed AFFINAGE and AFFINAGE, not ASP, was used to mark the countries.
IHC Australia re-commenced proceedings for breach of the undertakings.
Following service of the court documents (no other notice of complaint having been given), IHC UK amended its website.
The landing or home page now looked like:
IHC UK's modified home page
and Australia no longer appeared in the drop down box for countries under AFFINAGE, only under A.S.P.
Findings
Logan J found that the website in both its unmodified and modified form breached the undertaking in the deed of settlement and granted injunctions, amongst other things, requiring the A.S.P. component of IHC UK’s website to be removed from www.affinage.com. In contrast, the Facebook and Twitter links on the home page did not breach the undertakings.
On its true construction, the undertaking required IHC UK not to use AFFINAGE in Australia as a trade mark (at [61]). This required that IHC UK not use AFFINAGE as a trade mark in a way which targeted Australia.
IHC UK’s use targeted Australia
His Honour recognised that IHC UK was perfectly entitled to use its trade mark in, for example, the UK where it was the registered owner. The problem was to reconcile that entitlement and the global nature of the internet with IHC Australia’s territorial rights in Australia.
At [59]:
… the reconciliation to which I have just referred is achieved, in terms of the undertaking given in this case, by an approach that finds a use of the nominated words in connection with “marketing” in Australia if the words as so used are downloaded in Australia and there is evidence that the use was specifically intended to be made in, or directed or targeted at Australia.
Unlike the Ward & Brodiecase, that targeting was effected by the country selection box: that was its whole purpose. In the case of the unmodified website (at [60]):
that global web site is, inter alia, directed to or targeted at Australia. That is the whole purpose of the “Australia” option in the drop down box selection offered on the global landing page.
This was also true of the modified website. At [62]:
…. That Australian targeted use on the global landing page controls all that follows when one selects, as did Mr Bennett, the “Australia” option in the drop down box.
It was use as a trade mark
While IHC UK could legitimately say it introduced the brand AFFINAGE into Australia as a matter of historical fact. Its usage of the term went much beyond that.
On the first or unmodified form of the website, the purpose of the profile page or tab in the Australia” section was to persuade people to buy IHC UK’s, “and materially” its Australian distributor’s, products by reference to the AFFINAGE trade mark. At [67], his Honour explained:
When one reads the language of the “Profile” page in context, the repetition of AFFINAGE and the repeated use of “our brands” in conjunction with “worldwide” and “are marketed globally by IHC UK and through its associated companies in the USA and Australia”, the reference to Affinage is not just to a matter of foreign history but part of a current promotion that our goods worldwide, including those offered in Australia, include goods with the AFFINAGE brand. ….
No doubt, part of that context included the fact that one landed on a home page emblazoned with the AFFINAGE banner. But, his Honour, as in the Mantracase, was troubled by the repetitive use of the trade mark and, particularly, the representation that “Our goods “are marketed globally … in the USA and Australia”. His Honour also made the point that nothing on the profile page made it clear that IHC UK no longer held the rights to AFFINAGE in Australia.
The modified version of the website, featuring both the AFFINAGE and A.S.P. trade marks, was much closer to the line. Despite the separation between the 2 marks and the removal of Australia from the drop down box for AFFINAGE, however, Logan J considered it was still using AFFINAGE to target Australia in a trade mark sense. At [70]:
The “setting” for the viewer of this global landing page has undoubtedly changed and changed in a way that seeks to create a discrete Australian “target”. What remains though is a determined endeavour to place AFFINAGE in the mind of the viewer who has an interest in reading further in relation to Australia. The Australian “target” remains on the global landing page as a fixed feature. A connection between the AFFINAGE brand product and the ASP brand, each formulated by IHC UK is promoted and promoted to an Australian viewer. What the global landing page does not say is that IHC UK has no connection with the AFFINAGE brand in Australia. Instead, the overall “setting” is that there is an Affinage world brand in which the Australian province is known as “A.S.P.”. This, in my opinion, remains a use of that sign in Australia in connection with marketing contrary to the terms of the undertaking.
Accordingly, IHC UK was ordered to remove :
Australia from the drop down country box;
the A.S.P. pages from its website
any references to Australia from its website; and
any links between any new A.S.P. website and the AFFINAGE website.
FCR O35 r11(2)
For those interested in procedural matters, Logan J refused to follow the Ucorpruling and concluded that FCR O35 r11(2) conferred a power only; there was a discretion whether or not to award an injunction once it was shown the terms of the undertaking had been breached.
International Hair Cosmetics Group Pty Ltd v International Hair Cosmetics Limited [2011] FCA 339
You can probably guess its overall objective from the exposure draft bill’s longer short title. The range of matters covered extends across 6 schedules:
Schedule 1- Raising the quality of granted patents
Schedule 2– Free access to patented inventions for research and regulatory activities
Schedule 3– Reducing delays in resolving patent and trade mark applications
Schedule 4- Assisting the operations of the IP profession
Schedule 5- Improving mechanisms for trade mark and copyright enforcement
Schedule 6 – Simplifying the IP system
Of the many things that struck my eye, the proposals:
seek to introduce the diligent searcher standard for testing the obviousness of patents;
seek to have patent applications and oppositions (but not, so far, trade mark oppositions) tested on the balance of probabilities instead of being practically certain not to be valid
introduce the new statutory experimental use defence;
seek to introduce a presumption of registrability for trade mark applications;
introduce the patent opposition “pleading” system to trade mark oppositions; and
confer original jurisdiction in trade mark and registered design mattters on the Federal Magistrates Court.
As IP Australia’s announcement says:
Bill does not deal with gene specific issues, rather it seeks to raise patentability standards across all technologies. Gene specific issues are being considered separately by the Senate Legal and Constitutional Affairs Legislation Committee, and by the Government in its response to the Senate Community Affairs Committee’s Gene Patents report.
Over at Patentology Dr Mark Summerfield gives very detailed consideration to the pros and shortcomings of the obviousness reform, the changes to the requirement that patents be useful, the attempt to fix the law of fair basis (at least insofar as provisional specs are concerned), the new enablement requirement. Dr Summerfield seems to be on a roll, so there may well be more to come.
Comments and submissions should be provided by 4 April 2011.
Lander J considered that the goods covered by Hills’ registration should be limited as a result of non-use for the statutory period of 3 continuous years under s 92.
One interesting point on this part of the case is that Bitek had sought removal of all goods in its original application for removal. It accepted that evidence filed by Hills showed use in relation to some goods. Hills argued therefore the non-use application must fail since the application was directed to all goods.
Lander J rejected that argument:
[279] Because Bitek was seeking to remove “all of the goods” for non-use, Hills submitted that it was required to rebut the allegation of non-use of all of those goods. Hills argued that the evidence demonstrated use of the DGTEC trade mark in respect of several products including televisions, DVD players, CD players, decoders and cameras. On this basis, it argued that the application should be dismissed.
[280] In the alternative, Hills argued that Bitek could not alter its position or limit its application as an application for removal under s 92(2) is required to be in an approved form: reg 9.1 of the Regulations. The only application for removal in approved form is the initial application in which Bitek seeks to remove “all of the goods” in respect of which the trade mark is registered.
[281] Hills also said that Bitek should not be allowed to limit its application because to do so would lead to a denial of procedural fairness. …
Following a review of the cases, Lander J rejected these arguments:
[295] Hills’ argument that if the Court considered Bitek’s argument that the class of goods should be narrowed would result in a denial of procedural fairness should be rejected. Bitek’s concession means that it cannot have the relief it sought in the application but in seeking to argue that it is entitled to have the restricted relief it is thereby narrowing the scope of the inquiry. In those circumstances it could not be a denial of procedural fairness to allow the matter to proceed by reference to a narrower class of goods.
[296] I also reject Hills’ submission that the application must fail because there is evidence of use of some of its goods. I accept Bitek’s argument that the Court may exercise its discretion under s 101(2) to narrow the scope of the registration where the applicant establishes that a ground exists in relation to only some of the goods to which the application relates.
The power to excise some, but not all goods, was consistent with the policy of Part 9: to ensure that Register (and freedom to trade) was not cluttered with unused marks: [304] and consistent with the terms of s 101(2).
Lander J then refused to exercise a discretion against non-removal, apparently on the basis that any reputation that had been generated in respect of the goods on which there had been use did not spill over on to the goods for which there had not been use:
Bitek submitted that s 101(3) does not save Hills’ registration because there is no evidence of use of similar or closely related goods. The only evidence of use relates to a limited group of products which Bitek mainly excluded from its application for removal.
[316] In my opinion, Hills’ argument should be rejected. The fact that it has used its mark in respect of goods which are similar to those goods marketed by Bitek is not in my opinion to the point.
[317] The circumstance which is addressed in s 101(4) is whether Hills has used the mark in respect of similar goods to those to which the application relates. In Hills’ case it has not used the goods except in relation to set-top boxes, remote controls, digital video recorders with hard drive, televisions, CD and MP3 players, DVD players, micro sound systems, iPod docking speakers and web-based cameras. I do not think there is any evidence to suggest any use of any similar goods to those proved used by Hills which ought to be retained in the statement of goods.
Perhaps rather surprisingly given the finding of non-use in respect of some products, Lander J considered Hills’ specification of goods should be amended to read:
Digital and electronic products including set top boxes, remote controls, digital video recorders with hard drive, televisions, CD and MP3 players, DVD players, micro sound systems, iPod docking speakers and web-based cameras. (my emphasis)
Infringement
Lander J accepted he was bound be the decision in Gallo that removal of a mark for non-use operated only from the date of removal of the mark from the Register.
Bitech admitted it had used DIGITECH since 2003 in respect ofantennas, cables (including speaker, coaxial, data and security), plasma TV brackets, leads, AV switch selectors, connectors, wall plates of various types, splitters, TV mounting hardware, video senders, video intercoms, industry tools, remote controls, multi-switches, set-top boxes, cable ties and cable clips.
Ultimately, his Honour found that Bitek infringed by reason of its use on set-top boxes and remote controls, but not the other products.
Consistently with his Honour’s earlier findings, DIGITECH was of course deceptively similar to DGTECH. Apart from set-top boxes and remote controls, the goods for which Bitek had used its trade mark were either covered by its own (now) registration (s 122(1)(fa)) – and all use had been after the application date – or were not shown to be within the scope of Hills’ registration or goods of the same description. S 120(3) also could not be invoked as Hills’ trade mark was not well-known.
Hills Industries Limited v Bitek Pty Ltd [2011] FCA 94
Lander J has upheld the Registrar’s decision to allow Bitech to register DIGITEK for
“TV installation accessories including external TV antennas, none of the foregoing being set-top boxes” in class 9
in the face of Hills’ prior registration for DGTEC, DGTEK and DGTECH in respect of
“Digital and electronic products including televisions, video players, DVD players, CD players, decoders and cameras” also in class 9.
While the competing marks were deceptively similar, they were not in respect of the same goods or goods of the same description. At [110]:
…. The goods are fundamentally different. The brown goods which comprise the Hills products are goods which are digital and electronic and provide the display to the consumer visually or audibly. Bitek’s goods are as they have said; goods which allow the brown goods to function. They provide support of varying types to the brown goods.
At [114]:
It is right as Hills contend that the goods are interdependent and they rely on each other for their functionality. However, that does not take the matter far. Whilst the goods cannot operate on their own, they are not interchangeable. They are not “commonly used as alternatives or substitutes” for each other:… They each have their uses which are quite separate and distinct even though when they are put together they assist to perform the end function: ….
His Honour also rejected argument that the goods passed through the same trade channels, distinguishing the GalloFull Court’s finding that beer and wine were similar goods because:
[126] …. the clear impression I have is that goods of the kind under the Hills’ mark are marketed at the retail level and by direct advertising to consumers. TV installation accessories are mainly sold to professional installers at the wholesale level. A retail store may have for sale some accessories but only as a side line.
[127] Where a retail store does have TV accessories for sale it does not display them in the same manner as brown goods. Brown goods are used as the bait for consumers. Consumers want to see the product which will at least from the consumers’ point of view deliver the visual image or audible sound. TV installation accessories do not have the attraction from a sales point of view that brown goods have.
Lander J agreed with Kenny J’ ruling in McCormick that the s 60 ground of opposition could defeat an application independently of the operation of s 44(3).
However, his Honour rejected Hills’ opposition on the basis of the old form of s 60: although Hills proved it had more than $20 million of sales under its DGTECH mark of set top boxes, there was simply no proof that it had a reputation in the mark, the sales might well have resulted from the fact that Hills had a marketable product (apparently it was the only set top box in the market at the time). His Honour noted Kenny J had recognised in McCormick that it was often common to infer reputation from sales and advertising figures. It was not appropriate, however, to do so in this case:
[195] The evidence by itself does not prove any reputation at all. It may tend to prove that the goods sold under the mark are very marketable goods. In this case the goods being marketed under the DGTEC mark were set-top boxes which having regard to changes in the industry were marketable to persons who wanted to upgrade their analogue equipment.
[196] I do not think the bald evidence supports a finding of a reputation in the mark.
[197] In my opinion, the Hills’ mark had not acquired a reputation in Australia of the kind that is contemplated in s 60. The mark had only been used on set-top boxes prior to the priority date and although Hills, and previously the company, had sold in excess of $20 million worth of set-top boxes, there is no evidence that the mark under which the set-top boxes had been sold had a reputation of the kind contemplated in this section.
[198] For that reason alone, I would have dismissed Hills’ objection under s 60.
Striclty obiter
Even if Hills had established a reputation, Bitek’s mark would not have been like to deceive or cause confusion as a result of that reputation, so the old form of s 60 still would not have applied.
[208] Assuming, contrary to my opinion, that the Hills’ mark had acquired a reputation, it had only acquired, at the priority date, a reputation in respect of set-top boxes. Hills did not contend for any other reputation. If that was the case, the use of the Bitek mark in respect of its goods was not likely to deceive or cause confusion because the goods were unrelated to a set-top box. Bitek’s goods specifically excluded set-top boxes. A consumer wishing to acquire a TV installation accessory or external antenna bearing the Bitek brand would not in my opinion be likely to be confused or deceived as to the origin or provenance of those products because of Hills’ mark’s reputation in set-top boxes. For that further reason, Hills could not rely upon s 60 to defeat Bitek’s application for registration.
In case it became necessary on appeal, Lander J would have rejected Bitek’s attempt to rely on s 44(3) honest concurrent user or “other circumstances”.
Bitech failed on “honest concurrent user” and “other circumstances” because the use occurred after the priority date.
Under “other circumstances”, Bitek sought to rely on the inconvenience it would suffer through loss of the goodwill it had built up. If it had been permissible to take use after the priority date into account under “other circumstances”, Lander J would still have rejected this:
[187] However, I would not have exercised my discretion in favour of Bitek under s 44(3)(b) even if events after the priority date were relevant for two reasons. First, because Bitek had not used the mark prior to the priority date. It did not make any sales under the brand. Secondly, its case was that its goods are not sold by reference to its mark. As Hills contended, Bitek’s case was that the consumers of its goods are unlikely to be concerned with brands because brands are unimportant with TV installation accessories.
[188] If that is so, then it seems to me that little goodwill could have attached to the brand or the mark since it has been used and in those circumstances where there is a finding under s 44(1), there would be insufficient evidence to support the exercise of discretion in favour of the applicant for registration. If Bitek is right that its consumers do not depend upon brand or mark, then little would be lost to Bitek in arranging for a mark which is not deceptively similar to the Hills’ mark.
Hills Industries Limited v Bitek Pty Ltd [2011] FCA 94
ps The decision also addresses removal for non-use and infringement issues which, in view of the length of this post, will need to be the subject of a later post.
Anita Brown, over at IPanz, reports on Cowdroy J’s exercise of discretion to leave the Wild Geese trade mark for whiskey on the Registrar, even though non-use throughout the relevant statutory period was proved, on the basis of the perceived risk of public confusion.
His Honour also addressed the standing requirement for a non-use action.
His Honour’s reasons in full:
Austin, Nichols & Co Inc v Lodestar Anstalt [2011] FCA 39
