First, the Full Court held that Zip Co’s formative ZIP marks such as ZIP PAY, ZIP MONEY and:
were deceptively similar to Firstmac’s ZIP trade mark.
The honest concurrent user defence
Secondly, the Full Court held that Zip Co companies were not honest concurrent users for the purposes of section 44(3)and so the defence based on sections 122(1)(f) and (fa) failed. On this point, the Full Court emphasised that the onus was on Zip Co to establish it was an honest concurrent user; not on Firstmac to prove it was not.
The reasons for the failure of the honest concurrent user defence also meant that Zip Co could not rely on the defence under section 122(1)(a) for use in good faith of its own name.
Cancellation because Firstmac’s mark had become deceptive
Thirdly, the Full Court accepted that as a result of Zip Co’s reputation, the use of ZIP by Firstmac would be deceptive or confusing for the purposes of section 88(2)(c). The Full Court, however, exercised the discretion under section 89 and refused to order cancellation.
This case is the reverse of the Katy Perry case.[1] Both Full Courts did reject reliance on the old law “blameworhy” conduct cases in applying section 88 and considered that “blameworthy” conduct was one, but not the only, consideration to be taken into account in the exercise of the discretion under section 89.
In the Katy Perry case, the (differently constituted) Full Court found that Ms Taylor knew of Ms Hudson’s reputation as Katy Perry and that artists such as Ms Hudson exploited their celebrity through the sale of branded merchandise such as t-shirts and the like. Consequently, in applying for her trade mark with that knowledge, Ms Taylor was precluded from relying on section 89. For example, the Full Court said at [317]:
We consider that Ms Taylor’s act of filing the trade mark application with knowledge of Ms Hudson, her reputation, and her mark in circumstances where she also knew that popular music stars, such as Ms Hudson, lend their names (and trade marks) to be used in connection with clothes and sell merchandise at their concerts, and accepted such conduct as a common practice, is sufficient not to enliven the discretion under s 89.
See also at [342] – [343].
In contrast, Firstmac was not infected with such knowledge when it registered its trade mark; the Zip buy now pay later business not even being in existence at that time. At [175], the Full Court explained:
… where, as here, the primary judge found that Firstmac was without fault, and we have found that the respondents did not prove that their use of the Firstmac Mark was honest, to exercise the discretion to remove the Firstmac Mark would reward “the assiduous efforts of a misappropriating user”. To pick up on what Brennan J said in Murray Goulburn at 389, it would place a premium on those efforts.
The Full Court also examined the other mandatory considerations prescribed under section 89(2).
Removal for non-use
Fourthly, the Full Court held that Firstmac had proved use of its trade mark through advertising and promotion of its re-launched product such as:
Accordingly, Firstmac had satisfied its burden under section 100(1)(c) to defeat Zip Co’s action for non-use.
Cantarella owns two registered trade marks for ORO in Australia in respect of coffee. TM 829098 and TM 1583290.
The earlier of the two, the 098 mark, was filed on 24 March 2000. However, Cantarella’s evidence was that it first began using ORO as a trade mark for its coffee products “at least” from 20 August 1996.
Having successfully sued Modena and fended off the ownership and distinctiveness challenges to its registrations, Cantarella sued Lavazza for infringement of these trade marks by selling in Australia LAVAZZA qualità ORO coffee in packaging such as:
At trial, Yates J found this packaging involved use of ORO as a trade mark but did not infringe Cantarella’s trade marks because they were invalidly registered as Cantarella was not the owner:
The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.
Who used the trade mark first
The key fight in the appeal, as at trial, was whether Caffè Molinari’s products had used “ORO” as a trade mark in Australia before Cantarella’s first use on 20 August 1996.
In the Modena case,[1] evidence from Molinari’s senior executive only showed use after that date. In this case, however, Yates J accepted evidence from two different Molinari employees and two witnesses from CMS / Saeco that CMS / Saeco, a coffee business in Coburg Victoria, had in fact imported shipments of the Molinari product before Cantarella’s first use. So, in contrast to the Modena case, Cantarella was not the owner of the trade mark ORO in Australia[2] and its trade marks were invalidly registered.
For the most part, this conclusion turned on Yates J’s assessment of the creditworthiness of the witnesses which, despite some question marks, the Full Court considered it was not appropriate to disturb.
The Full Court rejected Cantarella’s argument that the finding about the date of Molinari’s first use in Modena was conclusive. It was a factor, but needed to be weighed in the balance with all the other relevant evidence.
Cantarella attacked the evidence from the Molinari witnesses who advanced data from Molinari’s records and set out in Excel spreadsheets. The issue here was that the invoices and shipping documents were no longer available for the sales before the priority date of Cantarella’s use. One of the Molinari witnesses also admitted that the spreadsheet might record “pro forma” invoices. Apparently, these were what we might call quotes, sent to customers and which only became sales if the customers accepted them. The Molinari witnesses were unable to say whether the relevant entries were sales or “pro forma” invoices.
The Full Court, however, pointed out that “pro forma” invoices of this kind would still count as use of the trade mark as offers to sell. (Also, there was the evidence of the CMS / Saeco witnesses that orders were placed and product in the packaging was received.)
Did Molinari use ORO as a trade mark in Australia
Next, Cantarella challenged Yates J’s ruling that ORO was used as a trade mark on the Molinari 3 kg packaging:
Molinari’s Miscela Di Caffè ORO composite usage
Cantarella argued that this was use only of a composite mark “Miscela di Caffè ORO”.
As with the finding about when Molinari first used ORO in Australia, Cantarella was unsuccessful in challenging Yates J’s acceptance of the evidence that Molinari’s 3kg packaging in 1995 and 1996 took the form of the 2007 packaging.
On that basis, the Full Court dismissed Cantarella’s appeal on this ground, explaining at [93]:
We have had regard to the primary judge’s finding, applying Modena, that the word ORO is inherently distinctive and capable of acting as a badge of origin when used in relation to coffee. We have had regard to the prominence given to the word ORO both in the context of the packaging as a whole, and relative to the words MISCELA DI CAFFÈ in the much smaller font. We have also had regard to the appearance of what Cantarella calls the composite expression as it appears on both the front and back of the 3kg packaging, where the relevant words are differently arranged. In each case the word ORO appears much more prominently than the words MISCELA DI CAFFÈ. We consider the word ORO simpliciter acts as a badge of origin. We therefore agree with the primary judge’s finding on this topic.
Use as part of a composite mark
To succeed on the s 58 ground, Lavazza had to show not just that Molinari was the first user of ORO as a trade mark in Australia, but also that it had used it continuously and not abandoned it.
During the Modena litigation, howeve, Molinari had changed its packaging to use the expression “QUALITÀ ORO” – which Cantarella had not challenged. Thus, the evidence showed a progression of uses:
Caffè Molinari’s QUALITA ORO branding vs the Miscela di Caffè ORO branding
Cantarella contended these were use of the composite mark “QUALITÀ ORO” only, not ORO alone.
Lavazza did not try to argue that “QUALITÀ ORO” was substantially identical to ORO (and so might invoke s 7(1)).[3] Rather, it argued these later forms of packaging were use of ORO itself.
At [113], the Full Court explained:
The fact that the mark in question may appear as a component of a larger mark does not preclude a finding that it has been used as a trade mark. Whether or not there has been such use will depend on the circumstances and the overall impression conveyed.
Then, the Full Court accepted Molinari had used ORO itself as a trade mark in the later forms of packaging. Their Honours noted this depended on matters of impression about which minds might reasonably differ but “on balance” agreed with Yates J’s finding explaining at [114]:
In the case of both the 6077 and 6021A/6021E products, the word ORO is given prominence by the use of a larger font and, in the case of 6021A/6021E, ORO occupies a central position on the pack separated from the word QUALITÀ by the horizontal line immediately above the word ORO. We also note that the word ORO is given prominence across the relevant product range including on packaged coffee products 1525E, 6091 (as depicted in J [201], being the December 2003 1kg packaging) and 6071. The use across the range is consistent with the use of ORO as a sub-brand within the Molinari range of packaged coffee.
No exercise of the discretion against removal
The Full Court then rejected Cantarella’s appeal from Yates J’s refusal to exercise the discretion under s 88 not to remove the registrations.
At [141], the Full Court recorded the long established proposition that, once a ground for cancellation is established, the registration should be cancelled unless sufficient reason appears for leaving it on the Register. The trade mark owner having the onus to show sufficient reason.
As this was a discretionary judgment, this required Cantarella to show legal error. The Full Court considered Cantarella failed to demonstrate any error and so this ground failed.
The main reason advanced by Cantarella was its reputation arising from its long use. However, the Full Court at [148] agreed with Yates J that this was not a matter of significant weight.
Assuming Cantarella had a strong reputation, it still retained the ability to prevent misrepresentation through passing off and the prohibition on misleading or deceptive conduct. And so, there was no compelling necessity for the marks to remain on the Register.
The unresolved issue
Cantarella sought to argue for the first time on appeal that it should be considered a joint owner of ORO at common law as a result of its long use as an honest concurrent user.
That is, Cantarella sought to throw into question the relationship between s 58 and s 44(3).
In McCormick, Kenny J had ruled that the new “plain English” version of the Act which put “honest concurrent user” in Part 4 of the Act dealing with grounds of rejection and “ownership” in Part 5 dealing with grounds of opposition meant that s 58 was in effect in a separate sphere from honest concurrent user and independent and superior to that ground. So that, even if an applicant established it was an honest concurrent user, it still could not be validly registered in the face of a successful s 58 opposition.
The Full Court refused leave for Cantarella to argue this for the first time on appeal.[4] At [134], however, their Honours did say:
The preferable solution to this difficulty may be to read s 58 and s 44(3) together to form a harmonious legislative scheme in which s 58 is read subject to s 44(3): Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at [69] – [71] per McHugh, Gummow, Kirby and Hayne JJ citing (inter alia) Ross v The Queen (1979) 141 CLR 432 at 440 per Gibbs J. That would involve recognising that s 58 does not apply in the circumstances where s 44(3) has been satisfied. But it is not necessary to resolve this issue in the present case because even if s 58 operates subject to s 44(3), the requirements of s 44(3) were not shown to have been met in this case. (emphasis supplied)
The problem for Cantarella was that it had not led any evidence explaining how it had come to adopt ORO and so of honest concurrent user would not be available.
I guess we shall have to wait and see whether a special leave application is forthcoming and, if it does, its fate.
Modena was Molinari’s exclusive distributor in Australia. The High Court’s decision, of course, laid down the law in Australia to determine when a mark has no inherent capacity to distinguish and held ORO was inherently distinctive for coffee. Consequently, Modena’s defence to infringement failed. ?
The owner being the first person either to use the mark in Australia as a trade mark for the relevant goods or services or to apply to register it with the intention of using it as a trade mark here: Re Hicks’s Trade Mark (1897) 22 VLR 636 at 640; Food Channel Network Pty Ltd v Television Food Network GP (2010) 185 FCR 9 (Keane CJ, Stone and Jagot JJ) at [49] – [55], Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd (2017) 251 FCR 379 (Greenwood, Jagot and Beach JJ) at [18] – [19]. ?
If the Registrar or a prescribed court, having regard to the circumstances of a particular case, thinks fit, the Registrar or the court may decide that a person has used a trade mark if it is established that the person has used the trade mark with additions or alterations that do not substantially affect the identity of the trade mark. ?
In fact, the issue was raised in obiter dicta by Yates J at [647] – [649]. ?
O’Callaghan J has awarded “The Practice” $200,000 in damages against The Practice Business Advisers & Tax Practitioners for trade mark infringement.
The Practice has been the owner since 2016 of Registered trade mark No 1757523:
for tax, accounting and business management services in class 35 and financial advisory and tax services in class 36. It had been using this trade mark since 2014, having adopted it in place of two rather more stylised logos in use from 1999.
The Respondent was incorporated in January 2017 and began providing business advisory and accountancy services under this logo:
In addition to the logo and in perhaps something of a differentiation from The Agency case, the evidence showed the Respondent’s website also featured:
(i) “At the Practice, our purpose is to Open New Possibilities and Add Value to Your Business”;
(ii) “The Practice can help you with: >> Taxation Advice >> Tax Planning >> Tax Effective Structures”;
(iii) “The Practice has the best business advisory accountants to guide you through this process.”;
(iv) “Contact The Practice”;
(v) “The Practice offers a full suite of financial and administration solutions for business such as small business bookkeeping in Melbourne and preparing sample small business financial statements”;
(vi) “Whether you need big or small business succession planning, The Practice is here to help.”;
(vii) “The Practice: Experts in Tax Compliance for Small Business”; and
(c) The following statements on the Respondent’s social media accounts:
(i) “The Practice can provide the tax solutions you need.”;
(ii) “The Practice’s Main Purpose is to open new possibility and add value to your business”;
(iii) “Here at The Practice, we tailor our services to meet the unique needs of your business”; and
(iv) “Let The Practice provide tax and business solutions for you!”
(d) On invoices sent to clients the words “THE PRACTICE” are shown in different coloured font to the rest of the invoice, with “THE” in light blue and “PRACTICE” in dark blue.
(e) Mr Hassan’s email signature has the words “The Practice” in bold font above the italicised words Business Advisers and Tax Practitioners.
(the emphasis was added by O’Callaghan J).
Perhaps the most interesting aspect of the case is that the Respondent sought to rely on the use of own name in good faith (s 122(1)(a)) and honest concurrent user (s 44(3) via s 122(1)(f) and (fa) as defences to infringement.
In rejecting both defences, O’Callaghan J considered at [61] and [88] that a person would not be acting in good faith (or honestly) if they did not take the steps that an honest and reasonable person would take to ascertain the ability to use the trade mark; they had in effect taken a risk.
The basis of these defences were searches that Mr Hassan, the sole director of the Respondent, claimed to have made. These claims were rejected. They came under sustained attack as “recent invention”. But O’Callaghan J also pointed out, Mr Hassan claimed to have searched terms like “The Practice Business Advisers and Tax Practitioners”; no where did he claim simply to have searched “The Practice”. Moreover, while Mr Hassan did claim to have undertaken a trade mark search, that was only back in 2001 when he was adopting a different version of the name.
O’Callaghan J did not accept the argument that the Respondent was only a one man company, not a large multinational (at 71] to [72]):
I cannot accept that submission. In my view, a person in the respondent’s position acting honestly and reasonably would have conducted far more extensive and thorough searches than Mr Hassan says he did to ensure that his chosen name did not conflict with a registered trade mark. In those circumstances it is unnecessary to consider the veracity of Mr Hassan’s evidence about his searches in 2013, 2014 and 2017.
The onus was on the respondent to prove that it had used reasonable diligence to ascertain that a chosen name did not conflict with a registered trade mark and in my view, the respondent has not discharged that onus for the reasons I have given.
The $200,000 damages were comprised of $100,000 compensatory damages and $100,000 additional damages. The judgment doesn’t disclose the scale of the Respondent’s business or its impact on the applicant’s business – other than it was a one man company.
The Practice Pty Ltd v The Practice Business Advisers & Tax Practitioners Pty Ltd [2024] FCA 1299
A trade mark registration may be attacked, or its registration opposed, on the grounds that the application was made in “bad faith“.
Basing themselves on UK decisions on the corresponding provision, Australian courts have sought to test this by whether people adopting proper standards would regard the decision to (apply to) register the trade mark as “falling short of acceptable commercial behaviour”. See e.g. Fry Consulting at [165] and DC Comics at [62].
Generally speaking, influenced by the examples in the EM, this has meant allegations of bad faith have tended to have success where the applicant can be said to have been aware of some other person’s trade mark and has sought to take advantage of that unfairly or opportunistically.
The IPKat, however, reports that the UK Supreme Court has accepted bad faith may be found where the applicant did not have an intention to use the trade mark in relation to all the goods, or services, specified in the application.
This decision was reached in circumstances where Sky’s trade mark was registered in respect of:
(a) good which it never had any intention of using – such as “bleaching preparations” and “whips”;
(b) categories of goods and services such as “computer software” which were so broad that Sky could not have intended to use its trade mark across the full range; and
(c) in some cases all goods or services in particular classes.
Now, it is certainly arguable that Lord Kitchin’s reasoning is not directly transferable to Australia as it was made under the strictures of EU law and his Lordship considered that the position under the 1938 Act had been superseded and replaced by the requirements of the 1994 Act implementing the requirements of the EU Trade Marks Directive.
That said, as Lord Kitchin pointed out, the EU regime has been developed to implement obligations under the Paris Convention and the TRIPS Agreement – both of which our 1995 Act sought to implement.
Moreover, Lord Kitchin recognised that challenges based on non-use did not preclude a challenge on the grounds of bad faith. At [193] – [194], his Lordship explained:
Indeed, in Ragopika at [73] – [74], Kennett J considered that “bad faith” requires to be tested by whether or not the conduct involves and attempt to use the trade mark system contrary to the purposes of the system:
What these examples have in common is an attempt to use the statutory regime for registration and protection of trade marks for a purpose that is foreign to the purposes of that regime, and undermines or hampers the proper use of that regime by businesses consistently with those purposes. Trade mark legislation balances various interests, as discussed by reference to the 1955 Act in Campomar Sociedad, Limitada v Nike International Limited [2000] HCA 12; 202 CLR 45 at [40]–[49], but its objectives can be said to boil down to “consumer protection and protecting the interest of traders in both the goodwill associated with their trade mark and the value of the registered trade mark as property in its own right” (Davidson and Horak, Shanahan’s Australian Law of Trade Marks and Passing Off (7th ed, Thomson Reuters 2022) at [1.05]). A leading English case described registration of a trade mark as “designed to enable bona fide proprietors to protect their proprietary rights without having to prove unfair trading” (Harrison v Teton Valley Trading Co Ltd [2004] 1 WLR 2577 at [24], quoted in Fry Consulting at [147]).
The concept of “falling short of acceptable commercial behaviour”, as an aspect of or pointer to “bad faith”, needs to be understood in this context and anchored in the Act. The behaviour needs, in my view, to be more than simply ruthless or morally questionable. If not actually fraudulent or dishonest, it needs to have some quality that makes it repugnant to the purposes for which the statutory regime exists. ….
His Honour’s reasoning is reflected in Lord Kitchin’s analysis. So, at [152] – [153], Lord Kitchin explained:
Wheelahan J has ruled that Vittoria’s[1] instant coffee jar did not infringe the registered trade mark for the shape of the Moccona instant coffee jar, TM 1599824. In some consolation for KDE, however, Wheelahan J also rejected Vittoria’s attempts to have the Moccona shape trade mark cancelled.
Moccona “shape” TM
As well as (non-)infringmenet, his Honour’s 603 paragraphs cover a kitchen sink of issues including s 41, s 59, bad faith, fraud, false suggestion or misrepresentation, non-use, authorised use and, just in case the infringement case did not succeed, misleading or deceptive conduct / passing off.
One interesting aspect of this case is that both sides relied on evidence from marketing experts and industrial designers although the industrial designers proved more useful (for the Judge) than the marketers.
To give some context to the infringement findings, it is as well to start with the attack on validity.
For the purposess of this post, I will touch on the s41 attack only.
Not inherently adapted to distinguish
Wheelahan J held that the Moccona jar had no inherent capacity to distinguish at all. However, TM 1599824 was filed on 7 January 2014 and KDE had used it so extensively that it has acquired secondary meaning so that it did in fact distinguish coffee as coming from KDE.
Although the shape was the shape of a container and, unlike Kenman Kandy, not the shape of the goods – coffee, a container for “otherwise formless goods” which was purely functional could not be adapted distinguish; there must be something “extra” about the shape. (At [258] – [259]).
The Moccona coffee jar was not purely functional: it was not a plain box, sachet, tube, tin or carton. It had relatively squat proportions, a double-tiered lid and a particularly shaped shoulder.
However, the expert evidence considered the shape was essentially a traditional jar shape. There was evidence of similarly shaped jars for other prodcts, the shape was similar to food preserving jars and at least two producers, Andronicus and Park Avenue, had used similarly shaped jars in the 1980s and 1990s.
In light of this evidence, Wheelahan J considered that the non-functional features of the Moccona jar played an aesthetic role but did not play the role of a badge of origin. At [267]:
even those features of the KDE shape mark that do play an aesthetic role still do not serve any inherently distinctive role. Rather, features such as the double-tiered lid and the shoulder of the jar serve to evoke a particular tradition, forming part of the common heritage. In other words: the KDE shape mark is both primarily functional and, to the extent that it is not functional, it draws on features of the common heritage that are not apt to distinguish the goods of any one trader.
Secondary meaning
His Honour found, however, that KDE had used the shape of the Moccona jar sufficiently that it had become distinctive in fact of KDE thereby defeating the operation of s 41(3).
A number of factors led to this conclusion.
First, there were numerous coffee jars and containers in evidence but within the diversity of shapes and sizes, the Moccona jar was distinct ([293]).
Secondly, in 1981, the then rival Andronicus brand had run an advertisement featuring an unlabelled Moccona-shaped jar to identify the expensive import which Andronicus sought to be compared to and compete with ([294] – [296]).
Thirdly, while Andronicus and Park Avenue had used jars similar to the Moccona jar in the 1980s and 1990s, there was no evidence of anyone supplying instant coffee in such a shaped jar since then – except of course “Moccona” ([297]).
Fourthly, there had been some (Cantarella described it as “limited”) television or streamed video advertising in which the jars had been depicted without any labelling.[2] The “Moccona” trade mark did appear at various points in the advertisements, sometimes in close proximity to the jars, but not actually on the jars themselves. For example, Wheelahan J explained of one advertisment in the course of rejecting the non-use attack (at [352]):
Unlabelled Moccona coffee jars
The “Dec Jar 2022” video, which related to the “Be Inspired” range of limited-edition Moccona glass jars, is striking. This video — which, I have already noted, has been viewed more than one million times — shows six unlabelled Moccona jars together and individually. The video never shows the jars with a Moccona label. While the Moccona logo does appear at certain points, this video illustrates clearly how the applicants have deployed the shape of the jar as a trade mark. It was accepted that the actual jars depicted, when sold in supermarkets, did bear Moccona labels. The fact that the applicants chose to advertise the jars without the Moccona labels, however, indicates that the jar was being used as a device that, in and of itself, marked out the coffee within the jars as Moccona coffee. The Moccona logo appearing in the advertisement was relatively small, and was not dominant when compared with the jars. Viewed objectively, this video is an instance of the KDE shape mark being used as a device indicating the origin of the coffee contained within the jars, and thus as a trade mark.
Returning to the question of acquired distinctiveness, his Honour concluded at [306]:
…. But from when the Andronicus advertisement was broadcast in 1981, the applicants developed a significant association between their coffee products and the jar shape in which those products were sold. In the two decades immediately preceding the priority date, there were no competitors using jars that were apt to detract from the effectiveness of this use as a badge of origin. That provides the context in which the advertisements described above must be understood. Especially by means of those advertisements, which I find to have been extensive given the amount of revenue spent on advertising that was the subject of confidential evidence, the applicants clearly deployed the KDE shape mark as a badge of origin in the last decade before the priority date. In all of the circumstances, I consider that this amounted to such significant use of the KDE shape mark as a badge of origin before the priority date as to satisfy the test of use under s 41(3)(b).
The confidentiality of the advertising expenditure figures makes it a bit difficult to assess the extent of use. Also, by my count, there were 14 TVCs / YouTube videos of which 4 or possibly 5 were before the priority date. Four of those 5 were shown in free-to-air and pay TV (presumably reaching national audiences); the fifth in 2014 was shown to have had 19,000 views. Some of the later videos were shown to have hundreds of thousands of views and even millions.[3]
Authorised use
Cantarella argued that KDE could not rely on the advertising in Australia as that advertising was produced and run by JDE Australia. JDE Australia was not a subsidiary of KDE (nor KDE, a Netherlands company) of JDE Australia. Both, however, were subsidiaries of the same ultimate parent company.
Wheelahan J found that JDE Australia’s use was nonetheless use under KDE’s control and so qualified as authorised use.
First, the evidence showed that the coffee sold in Australia had been manufactured in a factory in the Netherlands by JDE Netherlands. JDE Netherlands sold the coffee in the jars to JDE Australia. JDE Netherlands was a wholly-owned subsidiary of KDE and both shared the same address. In these circumstances, Wheelahan J at [322] was willing to infer JDE Netherlands made and sold the coffee under KDE’s control.
Cantarella argued there was no evidence that the glass jars themselves had been manufactured under KDE’s control. Wheelahan J considered this was not necessary. At [323]:
…. The question posed by s 8(3) is whether “the owner of a trade mark exercises quality control over goods or services” in relation to which a trade mark is used. Having regard to the registration of the KDE shape mark in this case, s 8(3) will be satisfied if KDE exercised quality control over the coffee or instant coffee in relation to which the shape mark was used. It is not to the point whether KDE oversaw the manufacture of the glass jars in which the coffee was sold.
I am not sure I would be willing to advise a client not to control the manner of use of the trade mark as well as the quality of the goods or services being provided. Although one might expect in this situation it was fairly safe to assume KDE was not letting JDE Netherlands send out coffee in cracked or otherwise deficient jars.
In any event, Wheelahan J also found a second basis for finding quality control. Cantarella pointed to the fact that, unlike Trident Seafoods, KDE and JDE Australia did not have common directors.
Wheelahan J accepted at [331] that common directors was one of three key considerations in the Trident Seafoods court finding a “unity of purpose” between the user and the trade mark owner. It was a significant, but not determinative, factor. His Honour considered that the principle emerging from Trident Seafoods was that “unity of purpose” would be indicative of actual control by the trade mark owner over use of the mark. Whether sufficient “unity of purpose” could be inferred will vary from the circumstances of individual cases.
In addition to the two companies both being members of the same corporate group, JDE Australia was a wholly-owned subsidiary of DE Investments. During the relevant non-use period, DE Investments and JDE Australia did share some directors.
Moreover, DE Investments and KDE had entered into a licence agreement as a result of which JDE Australia was required to comply with KDE’s “brand guidelines” and, further, to obtain KDE’s approval before introducing “any new key communication asset in Australia”. At [335], Wheelahan J found KDE did in fact exercise actual control over the advertising used by JDE Australia.
As a result, Wheelahan J found that KDE, DE Investments and JDE Australia shared a common purpose of deploying KDE’s intellectual property for the purposes of the global group.
Unless you’re acting for someone being sued by such a global tentacle, we can all with respect breathe a sigh of relief.
Infringement – or not
While Wheelahan J rejected Cantarella’s wide-ranging attacks on the validit of KDE’s registered trade mark, his Honour found Cantarella’s Vittoria jar did not infringe.
First, his Honour held that the Vittoria jar was not actually used as a trade mark.
The jar itself was relatively plain, in contrast to the Moccona jar, and for that reason less likely to draw attention. Moreover, there was no evidence of Cantarella advertising its products in unbranded jars.
And, while the use of the Vittoria logo was necessarily smaller than the jar itself, his Honour considered the Vittoria logo served the trade mark function, in some cases “swamping” any possibility that the jar would be seen as a trade mark.
An advertisement for Vittoria coffee
As his Honour explained at [463] of this advertisement:
…. the overall impression I gain from this advertisement is of a Vittoria-branded product that is packaged in a particular jar. Without more, featuring a product in its packaging as part of an advertisement does not constitute trade mark use. Nothing about the advertisement is apt to suggest to a viewer that Vittoria coffee can be distinguished from the coffee of other traders by the relatively plain shape of the jar alone. ….
Similarly, at [475] the overall appearance of the aisle fins featuring the Vittoria product including the fact that the whole product was displayed, the plainness of the jar and the prominence of other branding elements led his Honour to distinguish RB Hygeine on its facts.
Aisle fin for Vittoria coffee
Secondly, while Wheelahan J accepted KDE’s argument that purchasers of instant coffee do not spend a long time deciding which products to buy, his Honour considered at [496] (and [502]) that there was no “real, tangible risk that a notional buyer, with a recollection only of the KDE shape mark’s rough proportions and general shape, would be perplexed, mixed up, caused to wonder, or left in doubt, about whether instant coffee sold in the Cantarella jar shape has the same commercial source as coffee sold in the KDE shape mark.”
Moccona coffee jarVittoria coffee jar
Wheelahan J considered that a notional consumer would recall three core features of the Moccona jar: its overall proportions being a fairly squat body sitting beneath a slowing sloping should and lid; the body being roughly two thirds of the overall height. Secondly, the shape of the shoulder and the neck. Thirdly, the height of the lid.
In contrast, Cantarella’s jar had a much taller body compared to its width; the shoulder was quite rounded and involved very little height and the lid appeared as a single, flat disk wider than the neck. At [502]:
The buyer would view the Cantarella jar shape as noticeably taller in its proportions, with a compressed neck section, and a plain, low lid. Even with the imperfect recollection outlined above, there is no real risk that a buyer could confuse the Cantarella jar shape, in view of its distinct visual impression, with the KDE shape mark.
A short comment on the evidence of the marketing experts
At [187], Wheelahan J recorded that he did not find the evidence of the marketing experts of much assistance. This was essentially because the experts addressed (and had been asked by the parties to address) marketing concepts rather than the legal concepts related to trade mark use.
In the case of Prof. O’Sullivan (called by JDE), this was because his evidence was directed to “diagnostic cues”; features used by consumers to identify something or distinguish it from something else. Wheelahan J considered this did not address whether the features the Professor identified functioned as a “badge of origin”. As his Honour explained by way of an example at [190]:
For example, if only one producer of instant coffee were to market a 750-gram jar, consumers could successfully rely on the size of the jar as a “diagnostic cue” for identifying that producer’s coffee. But, without more, nothing about this example suggests that the size of the jar is being used as a badge of origin. In this way, the concepts deployed by Professor O’Sullivan were too broad to answer the narrower question the Court must confront.
On the other hand, Vittoria’s Mr Blanket addressed questions about “the core elements of a brand” rather than whether some feature was being used as a trade mark. Wheelahan J explained at [191]:
…. He seemed to suggest that a feature will not amount to a core element of a brand, or perhaps even a brand element at all, if the feature does not appear consistently in relation to the entire range of products within the brand, or if it is not necessary for consumers to use for the purposes of identifying products within that brand. During cross-examination, examples were given of the Coca-Cola bottle and the triangular prism involved in the Toblerone packaging. Mr Blanket appeared to suggest that the bottle and packaging would not amount to core brand elements because some Coca-Cola and Toblerone products are sold without them. ….
Wheelahan J also considered that “certain aspects” of the experts’ evidence were not persuasive, even in their own terms.
Thirdly, Wheelahan J considered the marketing experts’ evidence did “not provide great assistance” as it was directed the to “jury issues” which were ultimately matters for the Court to decide.
Given the expense of deploying marketing evidence, very careful thought indeed needs to be given to its desirability and how it can be made useful
The advertisements and stills extracted from them are discussed at [45] – [88]. Unlike the YouTube video in Motherland, KDE’s evidence included evidence of broadcast on Australian TV or “views” by Australian consumers. ?
The attempt by global online sports merchandise retailer, Fanatics LLC, to expand its operations directly into Australia has resulted in the cancellation of its FANATICS registrations in class 35[1] (but not class 42[2]) and findings that it had infringed FanFirm’s competing registrations in class 25[3]. FanFirm’s own registrations in classes 9, 16, 24, 32 and 38, however, were cancelled for non-use.
The case runs through the gamut of issues: ownership, first use, similarity of goods / services, cancellation under s 88, removal for non-use, honest concurrent user, infringement, defences under s 122(1) and ACL / passing off. Rofe J’s judgment runs to 497 paragraphs so I am not going to try to tackle everything. Rather, I want to pick out three or four issues which I found particularly interesting. In particular, when the US-based respondent sought to expand its business in Australia, it was forced (unsuccessfully) to try to read down the scope of FanFirm’s registered trade marks as mere adjuncts to its tour operator business.
You might recall watching a sporting event where there were some raucous crowd members wearing green and gold curly wigs. It turns out the original fanatic, a Mr Livingstone, attended the US Open in 1997 where his “enthusiastic support” earned him an invitation to attend a post match celebration with the winner, Pat Rafter.
Beginning with a Davis Cup match in October 1997, Mr Livingstone parlayed this beginning into a business promoting tours to sporting and, eventually, cultural events and selling merchandise. Those attending the tours often wore merchandise such as “FANATICS”- branded t-shirts and caps. In 2004, Mr Livingstone incorporated the applicant and it took over the business which has continued to grow and expand so that, by the time of the trial, there were some 160,000 members in its customer database.
Meanwhile, in 1995, the respondent started life in the United States as Football Fanatics Inc. It formally became Fanatics Inc only in 2010.
The respondent operates around the world selling licensed sports merchandise such as NBA, NFL, F1 and Premier League products and, since 2018, third party merchandise which it manufactures and brands with its FANATICS Marks.
Before 2010, the respondent’s business was operated through a series of audience-specific brands and websites such as www.footballfanatics.com (1997), www.fastballfanatics.com (2006), www.fastbreakfanatics.com (2007), www.faceofffanatics.com (2007), www.fightingfanatics.com (2008), www.surffanatics.com (2008), www.fanaticsoutlet.com (2008), www.kidfanatics.com (2009) and www.ladyfanatics.com (2009).
In 2009, it acquired the domain name <fanatics.com> which initially redirected to the Football Fanatics website. From 2011, however, it became the respondent’s primary website.
It appears the respondent had been making some sales to customers in Australia from its Football Fanatics website since 2000. The respondent also provided what were described in the judgment as modest sales figures from its www.fanatics.com website to Australians beginning in 2014 through till 2020.
In 2020, the respondent’s Australian operations expanded significantly. It began operating the Essendon Football Club’s online store as “A Fanatics Experience” and began selling its FANATICS branded merchandise nationally through Rebel Sports stores.
The trade marks
FanFirm relied on two trade marks of which, TM 1232983, was for FANATICS in classes 9, 16, 24, 25, 32, 38 and 39 which was registered with effect from its filing date on 2 April 2008. (The respondent had unsuccessfully opposed registration back in 2010.)
The respondent also had two registrations for FANATICS, another for FANATICS and Flag device and registrations for FOOTBALL FANATICS and SPORTS FANATICS. The earliest registrations, for FANATICS and FOOTBALL FANATICS, dated from 10 September 2008. That first FANATICS registration was achieved on the basis of continuous prior use under s 44(4).
The respondent’s Flag device:
Who used first (in Australia) and for what
Rofe J’s first crucial ruling was the determination of who was the first user of FANATICS as a trade mark in Australia – and for what.
Her Honour found that FanFirm had been using FANATICS in relation to goods – the merchandise – from its website at www.thefanatics.com from 2004.
Her Honour also found ([151] and [158]) that FanFirm’s use on its website was use in relation to the class 35 services of on-line retail services of sports related clothing and merchandise, order fulfilment services and product merchandising.
In reliance on the CHIFLEY Hotel case, the respondent contended (at [152]) that FanFirm’s sales from its website were neither use in respect of clothing nor retail sales as they were merely an adjunct to FanFirm’s core business of providing tour and event services.
Rofe J rejected this characterisation. At [153], her Honour pointed out that merchandise could be purchased from FanFirm’s website even if no tour or event booking was made. Thus, there was no necessary relationship between tours and events on one hand and, on the other, the merchandise. Her Honour also noted that Markovic J in the Katy Perry case had found that the sale of merchandise at and in conjunction with Katy Perry’s concerts was use in relation to the goods and retail services. Rofe J explained at [155]:
Markovic J’s findings on this issue were not challenged on appeal and I respectfully agree with her Honour. Using a trade mark on goods does not cease to be “use as a trade mark … in relation to goods” for the purposes of s 120(1) of the Act simply because the sale of the relevant goods is “closely tied” or an adjunct to some service offered by the applicant which is their primary or core business. In any event, I do not consider that the sale of merchandise on the applicant’s website to be merely an adjunct to its main business of providing tour and event services.
and at [158]:
…. The applicant’s website provided an online retail service from at least 2004 because customers could visit the website, select a product and then purchase that product. It therefore also provided order fulfillment services and product merchandising within the meaning of the respondent’s class 35 registration. ….
As FanFirm’s use was before the respondent’s earliest use in Australia in 2010 or 2011 (at [144] – [145]), her Honour’s conclusions ultimately led to orders for the cancellation of the respondent’s registered trade marks in class 35.
This conclusion did not extend to the respondent’s class 42 services – setting up, managing and operating an online store for a third party – as her Honour at [159] found such services were not the same kind of thing as online retail services or the class 25 goods.
The respondent’s use infringed FanFirm’s class 25 registration
Next, Rofe J found that the respondent’s sales of clothing merchandise from its fanatics.com website to Australians infringed FanFirm’s registration in class 25.
Some of the goods sold were the respondent’s own products branded with its Fanatics and/or Fanatics Flag mark. The respondent, however, contested that the sales of third party merchandise (i.e., not branded FANATICS) from its website and some products where FANATICS appeared only on the swing tag (or similar) involved use as a trade mark in relation to goods.
The third party merchandise
FanFirm argued that the sale of NBA, NFL and other third-party clothing manufactured by the likes of Adidas and Nike from the respondent’s website constituted not just use of FANATICS in relation to online retail services in class 35 but also use in relation to the goods themselves.
An example is this webpage:
The respondent argued (at [215]) that this was only use of FANATICS in relation to online retail services just as use of REBEL on REBEL SPORTS stores was use in relation to retail services and not the goods themselves.
Rofe J held, however, that this use constituted use in relation to the clothing goods themselves, not just in relation to retail services. In doing so, her Honour relied on the decisions in Sports Warehouse, [Solarhut][sol], [Flexopack][flex], Edgetec and Bob Jane. At least some of these cases involved the sale from the infringer’s website of goods which were not manufactured by (or for) the infringer. Accordingly, her Honour concluded at [220]:
The respondent invites consumers to visit its website at www.fanatics.com. At that website, goods are available for purchase under the name FANATICS as part of the domain name, displayed in page headings and in references to products. I consider that this constitutes use of the FANATICS Marks as trade marks in relation to the goods for which the applicant’s FanFirm Marks are registered, including clothing, sportswear and headgear.
The swing tag use
From 2020, the respondent was offering for sale from sites such as “www.aflstore.com.au” and “www.rebelsport.com.au” shirts and other apparel for 11 AFL teams and also some of its own branded clothing. At least some of the AFL clothing did not bear FANATICS on the labelling or otherwise. The “only” use of FANATICS was on the swing tag:
In addition to the swing tag, the FAQ also stated:
15.1 “When you make a purchase, you are purchasing from rebel. The order is simply being sent from a Fanatics warehouse.”
15.2 “Products shipped by Fanatics will only be available online and will be shipped direct from a Fanatics distribution centre to customers. Rebel does not hold these products in Australia.”
15.3 “Click and Collect is not available for products shipped by Fanatics as they are not stocked in our stores. They will be available for delivery only”
Further, there were other goods on which the respondent’s trade mark had been embroidered or printed on the label (albeit a small proportion of the total).
As with the third party merchandise from the respondent’s own website, the respondent argued this use on the swing tag was only use in relation to retail services, not the goods themselves. Rofe J also rejected this argument in the context of this case.
Given that s 7 defines use as use upon or in physical or other relation to the goods, the fact that the use was on the swing tag and not on the goods themselves was hardly determinative.
At [198], Rofe J considered:
It would be apparent to any reasonable Australian consumer that the Hawthorn Football Club (or any sporting club) does not manufacture clothing, and that the Hawthorn indicia are part of the design of the shirt material. The use of the FANATICS Marks in these instances are being used as “a badge of origin” to distinguish the respondent’s relevant good from goods manufactured by other sports clothing manufacturers such as Nike or Adidas: E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144 at [41]–[42] (per French CJ, Gummow, Crennan and Bell JJ).
In any event, her Honour pointed at at [200]:
In this case, the FANATICS Marks on the FANATICS branded goods are being used as a badge of origin and thus the use constitutes trade mark use. The fact that other marks are present on the clothing, such as the logo of the relevant sporting team or league, does not matter. Dual branding is “nothing unusual” and does not have the effect that one of the marks is not being used as a trade mark: see Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd (2021) 162 IPR 52 at [66] (per Jagot, Lee and Thawley JJ) and the cases there cited (these comments were not disturbed on appeal in Self Care). See also Anheuser at [189] and [191] (per Allsop J).
Thus, subject to the respondent’s numerous defences, FanFirm’s trade mark for clothing etc. in class 25 was infringed.
Some issues raised by the defences
The respondent raised a number of defences against a finding of infringement – in addition to its unsuccessful attempt to have FanFirm’s trade mark cancelled.
The respondent was exercising a right to use the trade mark given by registration
The respondent’s first line of defence was s 122(1)(e) – the exercise of a right to use a trade mark given to the user under the Act. That is, someone does not infringe another person’s registered trade mark if the “someone” has registered their own trade mark and is using it within the scope of that registration.
The issue here is that, as the respondent was not the owner of the trade mark for online retail services, its trade mark was not validly registered as a result of the operation of s 88(1)(a) and s 58.
On this issue, while her Honour considered it a “strange result” from a policy perspective, at [313] – [314] Rofe J followed Nicholas J’s ruling in Dunlop and held that cancellation was not retrospective but prospective only. That is, the respondent’s trade marks were not cancelled ab initio but only from the date of her Honour’s order.
While this protected the respondent from awards of damages (or an account) for its past conduct, (at [385]) this did not protect the respondent from an injunction against continued use of the infringing trade marks.
Honest concurrent user
As it had been using its trade marks in Australia since 2010 or 2011, the respondent also argued the Court should find the respondent was entitled to registration (s 122(1)(f) or (fa)) on the basis of honest concurrent user (ss 44(3)).
Ultimately, her Honour rejected this defence, finding that the respondent’s use did not qualify as honest concurrent user.
The problem for the respondent was at least three fold. First, the respondent adopted FANATICS as its corporate name and trade mark with knowledge of FanFirm and its trade mark. Indeed, it had sought to oppose registration of FanFirm’s mark. Rofe J accepted the respondent did not adopt the trade mark to take advantage of FanFirm’s reputation, however, it could not be described as “independent adoption”. Moreover, while two of the respondent’s senior executives involved in the decisions gave evidence, no-one from the respondent gave evidence of any honest belief that confusion would not result. At [331], her Honour concluded:
The adoption of the respondent’s new corporate name and mark occurred with knowledge of the applicant and its mark, and the goods for which registration of that mark was sought. Whilst I do not consider that the respondent adopted the FANATICS Marks in order to divert business or goodwill from the applicant, it cannot be described as “independent adoption”. Further, as I have said above, despite leading evidence from two senior employees of the respondent, the respondent led no evidence as to the existence of any honest belief that there would be no confusion as a result of the respondent adopting the same mark as the applicant’s existing marks. Thus, the two hallmarks of honesty are absent from the respondent’s adoption of the FANATICS Marks.
At [383] – [383], Rofe J relied on similar reasoning to reject the respondent’s contention that her Honour should exercise the discretion arising under s 89not to remove the trade marks.
The injunction issue
In her Honour’s subsequent ruling on costs and non-pecuniary remedies, Rofe J stayed the operation of the order for cancellation of the registered trade marks pending the outcome of the appeal (for which Rofe J gave leave).
Rofe J also ordered an injunction restraining infringing use but refused to stay that order pending the determination of any appeal.
A number of factors led to her Honour refusing the stay.
These included, first, that her Honour was far from convinced that the respondent had the level of reputation in Australia it claimed given the apparently small scale of its sales here.
Secondly, the respondent’s claims of the disruption to its global business seemed overstated in light of the small scale of its Australian sales compared to the global business, its apparent disregard of the Australian market in deciding to adopt FANATICS and FanFirm’s evidence about the availability and utility of geo-blocking services so that the respondent’s sales to the rest of the world would be unaffected.
Further considerations included the dilution of FanFirm’s own goodwill and the difficulties in quantifying that.
Accordingly, Rofe J considered the balance of convenience lay in favour of not staying the injunction.
Bromwich J substantially upheld her Honour’s refusal to order a stay of the injunction but modified it slightly:
to allow the respondent 28 days to implement geo-blocking of Australia; and
to enable continued use in respect of “global customer care labels” in a particular form and to allow the respondent to deal with returns.
Bromwich J, like Rofe J, also referred to a number of other considerations.
Rofe J’s key finding was that FanFirm was the first user of FANATICS in Australia for goods such as clothing and online retail services for such products. Such use was not merely an adjunct to FanFirm’s tour organisation and supply business. As a result, the respondent’s trade marks for those goods and services will be cancelled and it has been enjoined against continued use in Australia. Just because you are clear to operate under your trade mark in one country does not mean you will be able to use it in another, different market.
Class 35: Business marketing consulting services; customer service in the field of retail store services and on-line retail store services; on-line retail store services featuring sports related and sports team branded clothing and merchandise; order fulfillment services; product merchandising; retail store services featuring sports related and sports team branded clothing and merchandise ?
Class 42: Development of new technology for others in the field of retail store services for the purpose of creating and maintaining the look and feel of web sites for others, not in the field of web site hosting; computer services, namely, creating and maintaining the look and feel of web sites for others, not in the field of web site hosting services; computer services, namely designing and implementing the look and feel of web sites for others, not in the field of web site hosting services; computer services, namely, managing the look and feel of web sites for others, not in the field of web site hosting ?
Class 25: Clothing, footwear and headgear, shirts, scarves, ties, socks, sportswear ?
In the 7Now case, the Full Court reminded us that the classic statement of when a sign is used as a trade mark for the purposes of Australian law is the Oil Drop Man case:[1]
With the aid of the definition of ‘trade mark’ in s. 6 of the [1955 Trade Marks] Act, the adverbial expression [‘as a trade mark’] may be expanded so that the question becomes whether, in the setting in which the particular pictures referred to were presented, they would have appeared to the television viewer as possessing the character of devices, or brands, which the appellant was using or proposing to use in relation to petrol for the purpose of indicating, or so as to indicate, a connexion in the course of trade between the petrol and the appellant. Did they appear to be thrown on to the screen as being marks for distinguishing Shell petrol from other petrol in the course of trade?
In that case, the High Court held that Shell was not using a caricature image of an animated oil drop man as a trade mark in its television advertisements and so did not infringe Esso’s registered trade marks depicting a “humanized oil-drop”. A surprising aspect of that decision is that, in doing so, the High Court overruled Windeyer J who had found it did infringe.
Unlike the High Court (who did watch the ads), we can’t see how Shell’s Oil Drop Man appeared. So it has always been something of a challenge to understand why.
Now Dr Vicki Huang, who professes law at Deakin University, has published an article revealing to the world some images from the original appeal books: “Uncovering secrets of Australia’s landmark High Court cases” (2024) 54 Australian Bar Review 209. (Unfortunately, its behind a paywall.) If you are a trade mark lawyer trying to grapple with what the late Prof. Lahore always regarded as the most elusive concept in Australian IP law, you should read it!
Seven had registered 7NOW as a trade mark, TM No 1540574, in respect of a range of goods and services in classes 9, 35, 38 and 41. 7-Eleven filed non-use applications against the trade mark on the s 92(4)(b) grounds.
By the time the proceeding reached the Full Court, four categories of goods and services in classes 9 and 35 were still in dispute (7-Eleven not pursuing the other services):
Category 1: computer software (in class 9);
Category 2: the promotion and sale of goods and services for others including through the distribution of online promotional material and promotional contests (in class 35);
Category 3: retail and wholesale services including retail trading via television programmes and by telephone and electronic means including the Internet (in class 35); and
Category 4: the bringing together, for the benefit of others, of a variety of goods enabling customers to conveniently view and purchase those goods including by mail order, telecommunications, website or television shopping channels (in class 35).
The trial Judge found that Seven had not discharged its onus under s 100 to show it had used its trade mark in respect of any of the categories and refused to exercise the discretion under s 101 not to order removal.
The Full Court allowed Seven’s appeal in relation to the promotion of goods and services for others only in Category 2 but otherwised dismissed it. As the Full Court emphasised in its quote from the Oil Drop Man case, the different outcomes arose from whether or not Seven’s use of its sign was sufficiently connected with the particular category.
How Seven used its 7NOW mark
It seems Seven’s evidence of use in the relevant period was limited to a one-page website:
As you can see, there is a 7NOW banner at the top of the page. Then (during the relevant period) there were 48 “tiles” which, if clicked, transferred the user to a different websites (some of which were associated with Seven such as 7plus and 7travel while others were not) and, finally, there was a panel with four columns of links at the bottom of the page.
Category 2 services
In effect the website operated as advertising the services being offered from the various websites linked through the 48 “tiles”. As the Full Court explained at [105], the
grid of those icons – [brought] to the consumer’s attention the services and goods offered on the linked websites and [made] it easier for the consumer to acquire those services and goods….
That was the performance of promotional services and those services were provided by reference to the 7NOW badge which clearly functioned as a trade mark. Accordingly, at [106]:
In our view, the connection shown on the website between the 7NOW mark, which has the character of a brand, and the actual performance of those promotional services is sufficient to mean that it has been used as a trade mark in relation to those services. ….
But, as the 7NOW website did not actually offer any goods or services for sale as opposed to the linked websites, the website was not “a means of delivering the service of selling goods. And so, Seven had not proved use of the mark in relation to sales services.
The other categories
To establish use in relation to computer software, Seven relied on the bottom two links under the 7Plus logo in the first column in the page “footer”:
“Get the iOS App
“Get the Android App”
If you clicked on one or other of those links, you were transferred to the page in the App store or the Android Play store where you could download the 7Plus app. 7NOW did not appear anywhere on those pages.
The Full Court agreed with the primary Judge’s conclusion that 7NOW had not been used to distinguish the (7PLUS) software from software being offered by third parties. A number of considerations from the overall context of the use played into this conclusion. These included:
7NOW appeared only once on the website – at the top of the page and separated from the Store links by the 48 “tiles”;
the links to the stores were very much smaller and much less prominent that the tiles;
the links appeared under the, relatively speaking, prominent 7PLUS logo
there was no reference to the 7plus app at all;
getting to the software involved a 3-step process
the user had to navigate to the 7NOW page
the user then had to scroll down to links at the bottom of the page and perceived and read the words under the 7PLUS logo; and
then click on the link and be transferred to the page;
the 7NOW trade mark did not appear on the Store page
The same problem infected the claimed use for the other categories. Seven’s argument was that its 7NOW trade mark was being used for retail services because a user could buy goods of services from the websites linked by some of the tiles. So for example if one clicked on the tile for 7travel or House & Garden, this is what happened:
As with the computer software, however, the Full Court found the consumer would think the goods or services being offered from the linked website were being offered by reference to the trade mark(s) on that website. The connection between the 7NOW trade mark and the service of offering the goods or services in question for sale was not so much attenuated as severed.
If you do a Google search to buy some product, such as say a book, and the search results bring up, say, 10 or 20 links to sites from which you can buy the book, would you think Google was engaging in retailing the book?
Discretion
Finally, the Full Court rejected the appeal from the refusal to exercise the discretion against removal.
Seven placed heavy reliance on its family of 7-formative marks and its reputation in particularly the 7plus mark given there were some 12.5 million registered users of the 7plus app.
A number of factors played into the Full Court’s conclusion at [166] that the risk of confusion if another trader were to use 7NOW in relation to, say, retail services [via convenience stores] was so high that it would be reasonable to retain the registration for all categoires. Seven Network (Operations) Limited v 7-Eleven Inc [2024] FCAFC 65 (Burley, Jackson & Downes JJ)
Last week reviewed the notice and take down / moderation procedure the majority of the Full Federal Court adopted to limit the injunction against Redbubble’s trade mark infringement. In the course of allowing Redbubble’s appeal, the Full Federal Court also unanimously flagged significant questions about when the use of a trade mark on a website overseas may constitute trade mark infringement in Australia.
On these matters, Perram and Downes JJ delivered the main reasons and Nicholas, Burley and Rofe JJ agreed.
You will recall, Redbubble operates a website to which creators can upload their designs and customers can then buy merchandise to which the customers have chosen to have the designs applied. Once a customer has placed an order, Redbubble undertakes the fulfilment function including having the products manufactured and delivered to the customer branded with Redbubble’s trade marks.
Redbubble’s servers (at least in this case) are in the United States.
This part of the appeal concerned the second part of the trial – transactions 8 to 11. In the case of these “transactions”, Hells Angels’ trade marks officer in Australia merely viewed the trade mark infringing images on Redbubble’s website; he did not even make a trap purchase. There was no evidence that anyone else in Australia ever viewed the images or bought them.
Did this infringe?
The short answer is “yes”. But it is how the Full Federal Court got there that will require careful consideration in the future.
At first instance
The starting proposition is that for trade mark infringement in Australia there must be unauthorised use of the trade mark (or a substantially identical or deceptively similar sign) as a trade mark – i.e. as a badge of origin.[1]
Way back in 2005, Merkel J had concluded in Ward v Brodie the fact that a website was accessible from Australia was not sufficient to establish use; it was necessary to show that the website was directed at or targeted Australia.[2]
At first instance in this case, Greenwood J having found that the trap purchases (transactions ##1 to 7) infringed also found that transactions ##8 to 11 infringed even without a purchase. In doing so, his Honour applied the proposition that he had propounded in his 2019 ruling (which also involved trap purchases) at [469]:
The capacity to engage, in Australia, through the website, as Mr Hansen did, constitutes use in Australia by Redbubble. [3]
The appeal
Redbubble had not disputed that proposition at trial. It did seek to raise it as Ground 1 of its appeal. As it had not sought to argue the ground at first instance, however, this would have required leave and ultimately it did not press it.
So, it was unnecessary for the Full Federal Court to deal with the issue. At [48], however, their Honours placed a question over the correctness of Greenwood J’s proposition. Perram and Downes JJ said:
For the reasons which follow, to the extent that [469] of the 2019 judgment deals with the situation disclosed by Examples 8 to 11, we would reserve the correctness of that statement for a case where it is directly raised.
In the following paragraphs, their Honours identified at least three issues which would need to be addressed.
Why is a trap ‘viewing’ not an authorised use
The first issue was why a trap viewing was not a direct infringement.
Here, Perram and Downes JJ considered the trap purchases in Ward v Brodie had not been infringing because (now repealed) s 123(1) of the Trade Marks Act had provided it was not an infringement to use a trade mark in relation to goods to which the trade mark had been applied by or with the consent of the trade mark owner.
With the repeal of that provision, however, that proposition could no longer be applied. Further, at [50] their Honours questioned whether the replacement provision, s 122A,[4] “could be pressed into service” instead. Although their Honours expressed no concluded view at this stage.
However, Perram and Downes JJ at [51] questioned Merkel J’s conclusion in Ward v Brodie that a trap purchase was not authorised use under s 8(1). As a consequence, their Honours considered it would also be arguable that at least some of the trap viewer’s actions in viewing the images (i.e. requesting Redbubble to serve the images to the trap viewer) might also be authorised use and so fall within the defence provided by s 122(1)(e).
Noting once again that these matters had not been argued and so did not need to be decided, at [52] Perram and Downes JJ considered whether authorised use could in fact be made out could be “highly dependent on the particular facts”.
The reason for this warning lay in the different nature of some of the trap “views”. Mr Hansen, the Hells Angels’ trade mark officer had navigated to the Redbubble website and specifically requested the image displayed in transaction #8. The Redbubble website, however, included a carousel feature. So that, when image #8 was displayed the website automatically presented to him other images (##9 and 11) which Redbubble recommended to him.
The geographical reach of s 120(1)
The second issue the Full Federal Court raised was the geographical reach of infringement under the Australian Act. That is, there must be use as a trade mark in Australia. The Act does not reach acts outside Australia (if they do not involve trade mark use in Australia).
Is viewing an overseas website from Australia enough
Thirdly, Perram and Downes JJ at [57] considered it is open to question whether a website overseas which is merely viewed by people from Australia (other than a trap “viewer”) without purchase would constitute use as a trade mark in Australia. Their Honours noted that the previous decisions (apart from Greenwood J’s decision under appeal) including Christian v Nestlé involved an actual trade in Australia.
Noting that Moorgate Tobacco v Philip Morris established a threshold requirement for trade mark use that there “be an actual trade or offer to trade in the goods in Australia”, their Honours explained at [62]:
The question of whether mere overseas projection without a local trade in the goods can amount to trade mark use in Australia is, in our view, a question of considerable difficulty. It is made potentially more complex in this case because although the website is hosted from servers in the United States there is no doubt that Redbubble conducts business in Australia. The difficulty is that that business does not appear to have involved, in the case of Examples 8 to 11, any more than projection into the Australian market without any consequent trade in goods bearing the marks. An important question is whether the necessary geographical nexus for use of a trade mark in Australia can be established by the mere fact that the trader is engaged in trade in Australia albeit not in relation to the infringing trade mark. The answers to these questions are not self-evident. (emphasis supplied)
At [63], Perram and Downes JJ concluded:
On the current state of the authorities, we regard the matter as undetermined. At no point in either of the trial judge’s decisions does his Honour traverse these issues. We would therefore not read [469] of the 2019 judgment as resolving them.
Perhaps the issue that concerned their Honours is that, in the bricks and mortar world, Yanx established that consumers in Australia who bought “Yanx” cigarettes in the USA and imported them into Australia for their own personal use did not use the Yanx trade mark as a trade mark. The transaction was completed in the USA and the goods, when imported for the consumers’ own personal use, was no longer in the course of trade.
On the other side of the ledger, however, Deane J said in Moorgate at 433 –434:
The cases establish that it is not necessary that there be an actual dealing in goods bearing the trade mark before there can be a local use of the mark as a trade mark. It may suffice that imported goods which have not actually reached Australia have been offered for sale in Australia under the mark (Re The Registered Trade Mark “Yanx”; Ex parte Amalgamated Tobacco Corporation Ltd., at pp 204–205) or that the mark has been used in an advertisement of the goods in the course of trade (The Shell Co. of Australia v. Esso Standard Oil (Australia) Ltd., at p 422). In such cases however, it is possible to identify an actual trade or offer to trade in the goods bearing the mark or an existing intention to offer or supply goods bearing the mark in trade. In the present case, there was not, at any relevant time, any actual trade or offer to trade in goods bearing the mark in Australia or any existing intention to offer or supply such goods in trade. There was no local use of the mark as a trade mark at all; there were merely preliminary discussions and negotiations about whether the mark would be so used.
One might think that a website which was directed at, or targeting, Australians was making an offer to trade here or had an existing intention to offer and supply here, even if there is no actual sale. At least arguably, that does not seem very different, if at all, to advertisements in magazines circulating in Australia with the aim of soliciting custom. Moreover, (and this may require evidence in a particular case), if one clicks on the “Buy Now” or “Purchase” button on most websites, the whole transaction is automated and does not involve a volitional decision by the website operator whether or not to complete the transaction.
So why did Redbubble infringe
At the risk of simplifying the arguments very significantly, Redbubble’s argument was a kind of de minimis argument that the infringing images were not available to consumers in the ordinary course of trade.
This argument had two main strands to it. One strand was that the Hells Angels had been able to identify the accused images only through a prolonged period totalling some 4.5 hours over approximately 7 hours – typing in “Hells Angels” and filtering for “Newest”. Redbubble contended this was not the behaviour exhibited by ordinary consumers who, for example, spent on average spent less than four minutes on the site. The other strand was the claimed short period of time the images were available on the website.
Perram and Downes JJ did not think the primary judge had erred in rejecting Redbubble’s argument. Their Honours further pointed out that, if Redbubble had wanted to prove that an image was unlikely to be found, it should have provided evidence of what a search would have revealed at the relevant time. The carousel function also contradicted the argument.
Putting aside the factual problems, their Honours considered there was a more general objection to Redbubble’s argument. This was not a case of a consumer using a general search engine like Google or Bing and having to filter results. Rather, it was a case involving a search of a specific website with specific functionality designed to facilitate locating desired iterms. Having noted the search function and the catalogue Redbubble provided were central components of its business model, their Honours at [81] rejected the argument:
one must distinguish between, on the one hand, the difficulties a consumer may encounter in finding what they are searching for on a website explicitly designed for the purpose of helping them do so and, on the other, the idea that such difficulties entail that the website is not engaged in the ordinary course of its trade. We do not think that the fact that it might be difficult to locate goods bearing infringing trade marks in a poorly laid out store can mean that the goods are not being offered for sale in the ordinary course of the trader’s business. We do not think any different principle applies to a website of the present kind.
Some other matters
Patches and badges of affiliation
At [226], Perram and Downes JJ appeared to suggest that the use of the Hell’s Angels trade mark as “patches” on jackets and the like to indicate exclusive membership of the club would not be use as a trade mark. Pointing out that there may be trade mark use where the sign serves dual purposes, Nicholas, Burely and Rofe JJ at [255] expressly reserved that proposition for future consideration.
Nominal damages?
It is also worth noting that the Full Federal Court rejected Greenwood J’s award of $8,250 as nominal damages (if indeed it was nominal) on the basis that such an amount could never be considered “nominal”, whether it was calculated as $750 per infringement or as $8,250 on a global basis.
After reviewing the amounts that had been awarded in other cases as nominal damages, the Full Federal Court at [127] awarded the sum of $20 per infringement making, in total, $100.
Given the error in calculating the damages, the award of additional damages ($70,000) was also set aside since the amount awarded as damages was relevant to that assessment even if the amount awarded as additional damages did not need to be proportionate.
Most of the factors listed in s 126(2) did not support an award of additional damages and, while there was a ‘mild’ need for general deterrence, the trivial quantum of infringements led to no additional damages being awarded.
See also Christian v Société Des Produits Nestlé SA (No 2) [2015] FCAFC 153; 327 ALR 630 at [78]. An approach recognising that, as a website on a server overseas is accessible by anyone in Australia with an internet connection, the trade mark owner’s rights would be set at nought if infringement could be avoided simply by setting up a website on the internet while at the same time the owner’s rights (and the Court’s powers of enforcement) are territorially limited: Lifestyle Equities CV v Amazon UK Services Ltd [2024] UKSC 8 at [3]. ?
I am not aware of any decided cases on the interpretation of this provision. In the meantime, my attempt to understand it can be found in Warwick A Rothnie, ‘Unparalled importing and trademarks in Australia,’ (2020) 21(3) Business Law International 229 (behind a paywall I’m afraid). ?
The Full Federal Court has allowed Redbubble’s appeal from the remedies granted for its eleven infringements of five Hells Angels’ registered trade marks. In doing so, the majority instituted a kind of monitoring and notice and take down system as a “safe harbour” against trade mark infringement. In addition, the Court raised questions about how use of a trade mark on a website overseas may, or may not, constitute infringing conduct in Australia.
Redbubble operates a website at www.redbubble.com. Creators can upload images to the website. Other users can browse the website, select one or more of these images for application to merchandise such as t-shirts and coffee mugs. Once the orders have been placed, Redbubble contracts for the merchandise to be manufactured and shipped to the purchaser. Redbubble provides the payment processing service, it also provides the fulfilment functions including communications such as order confirmation and invoices with the purchaser. Redbubble’s trade marks were on the communications, the goods ordered and the packaging.
The servers for Redbubble’s website, however, are located in the USA and the day to day management is carried out there.
In this round, in two decisions,[1] Greenwood J at first instance had found Redbubble infringed the Hells Angels registered trade marks by 11 transactions. The 11 transactions were trap purchases by Hells Angels Australia’s trade mark officer.
His Honour went on to order declarations of infringement, damages of $8,250 and additional damages of $70,000. His Honour also ordered an injunction in general terms – for example:
Redbubble is restrained whether by itself, its officers, servants or agents or otherwise howsoever, from using the sign being the device described in Declaration 2 …, or any sign substantially identical with, or deceptively similar to, a sign consisting of the device, on the website operated by Redbubble in relation to trade in goods to which the sign can be applied, where such goods are goods in respect of which Trade Mark No. 526530, Trade Mark No. 723463 and Trade Mark No. 1257993 is registered.
On appeal, Redbubble did not challenge the infringement findings but sought to set aside the remedies.
The injunction
At the time of the judgment, creators were uploading to the website some 90,000 new images each day.
Secondly, it adopted what it called a Proactive Moderation Policy. This involved co-operating with rights holders to build up a stock of Reference Content, which it then used to monitor uploads and remove content assessed as too similar. Redbubble had extended the moderation policy to include some rights even without input from the rights owner. As part of this, Redbubble had been developing a software tool, RB Protect, with image matching and optical character recognition capabilities. This tool was limited to identifying identical images and had not yet developed to the point where it could do so in real time.[3]
At the time of the trial, Redbubble was conducting proactive moderation for some 477 rights holders (up from 200 in 2017). It had proactively moderated about two million artworks since January 2017 and terminated over one million uploader accounts.
On appeal, the Full Federal Court split 3:2 on the injunction issue.
All five judges were agreed that the injunctions ordered by Greenwood J were in error because they were not limited to restraining use of the trade marks as a trade marks; i.e., as badges of origin (see e.g Perram and Downes JJ at [213] – [214]).
There was a disagreement whether it was right to describe a trade mark owner who had proved infringement as having a prima facie right to a final injunction, or generally having such a right. Perram and Downes JJ would not have ordered any injunction. Nicholas, Burley and Rofe JJ ordered an injunction but, as noted above, instituted a “safe harbour” scheme based on Redbubble’s moderation policies.
Perram and Downes JJ
Perram and Downes JJ were concerned that describing a final injunction as a prima facie entitlement risked enlarging the trade mark owner’s rights beyond its statutory entitlement under s 20. Their Honours recognised that a final injunction was generally appropriate but emphasised the remedy, albeit statutory, nonetheless retained its equitable nature and was discretionary.
At [224], their Honours considered a good working rule was that an injunction may be refused if:
(a) the injury to the plaintiff’s legal rights is small;
(b) the injury is one which is capable of being estimated in money;
(c) the injury is one which can be adequately compensated by a small money payment; and
(d) it would be oppressive to the defendant to grant the injunction.
Adopting Shelfer v City of London Electric Lighting Co [1895] 1 Ch 287 at 322–323 and an article by Burley J and Angus Lang in (2018) 12 Journal of Equity 132 at 137–142.
The working rule was significant in this case. First, the evidence demonstrated that the only way Redbubble could comply with the usual form of injunction was to cease operating. Thus at [225] complying with the injunction would not just be inconvenient but grossly disproportionate to the right protected.
The remedy was grossly disproportionate because the Hells Angels had not demonstrated any loss and was not likely to suffer loss of any kind. At [226], Perram and Downes JJ explained:
We do not accept therefore that it would be correct to grant an injunction which could only be obeyed by Redbubble ceasing to trade. The shuttering of Redbubble’s business at the instance of a party which has suffered and is likely to suffer no loss of any kind falls within the working rule. If Hells Angels had demonstrated some actual or apprehended loss then the question would be much more difficult. Such a case might be presented by the owner of a trade mark which had a reputation for the exclusive nature of the products to which it was affixed (although there might be many other circumstances generating similar problems). For such a trader, even the intermittent appearance of its marks on Redbubble’s website for short periods of time could cause real harm to that goodwill and this could be so even without any sales. ….
In the “somewhat unusual circumstances of this case”, therefore, their Honours considered it was not appropriate to grant an injunction at all.
Nicholas, Burley and Rofe JJ
While agreeing that the award of a final injunction is discretionary, at [248] Nicholas, Burley and Rofe JJ considered at [248] that describing the right holder as having prima facie entitlement to a permanent injunction is both unexceptional and correct. Their Honours explained at [245]:
But generally speaking, unless the court is persuaded that there is no significant risk of further infringement occurring, or unless there exists some other discretionary reason for refusing the remedy, a final injunction will usually be granted against a party that is found to have infringed.
Further, at [249], their Honours agreed with Perram and Downes JJ that it is not necessary for the right owner to prove it will suffer irreparable harm or that damages will not be an adequate remedy.
It is also not necessary for the trade mark owner to prove that it is more probable than not that the infringer will commit further infringing acts. A final injunction might still be granted even if the Court considers the risk of repetition is “slight” or “negligible”.
In this case, there was admittedly a significant risk of repeat infringements. Indeed, the case itself involved repeat infringements.
Like Perram and Downes JJ, Nicholas, Burley and Rofe JJ considered a general injunction was not appropriate. The risk of repitition, however, meant an injunction was appropriate. Accordingly, at [251] their Honours limited its effects by specifying that the general injunction would not be breached by compliance with the moderation policies. Therefore, the general injunction was qualified:
3 The Appellant will not be in breach of orders 1 or 2 (the general injunction) if:
(a) it maintains a system involving the surveillance of its website at www.redbubble.com (the Website) and the removal of images that might infringe the marks referred to in orders 1 and 2 above which is no less rigorous than that which it had in place as at 24 August 2022 and is referred to in the affidavit of Mr Joel Barrett of that date as “Proactive Moderation”; and
(b) within seven days of an image to which orders 1 or 2 above refers being identified on the Website by the Appellants or its servants or agents, the Appellant removes the image from the Website.
4 Notwithstanding Order 3, the Appellant will be in breach of order 1 or order 2 if, on the First Respondent or the Second Respondent or both of them becoming aware of an image to which such order refers being available on the Website, and notifying the Appellant of the image by sending an email to legal@redbubble.com (or such other email address as notified by Appellant in writing from time to time):
(a) with the subject field ‘Hells Angels Complaint’;
(b) identifying the image by reference to the location of the image on the Website in the form http://www.redbubble.com/people/[username] /works/[work number and name]; and
(c) stating that the First Respondent and/or the Second Respondent considers that the image would breach Order 1, Order 2 or both,
the Appellant fails to remove the image or images from the Website within seven days of such email.
Perram and Downes JJ had considered such a limitation inappropriate as it required Redbubble to comply with its existing policies and, further, would be seen as giving the Court’s imprimatur to those policies.
Nicholas, Burely and Rofe JJ countered that the Order did not require Redbubble to maintain any surveillance system but would reduce the burden and risks of the usual form of injunction and was similar to the “site blocking” orders under the Copyright Act 1968. In addition, their Honours considered the making of the injunction in this form did not preclude a general injunction alone or different remedies in different cases. At [254]:
What injunctive relief (if any) should be granted at the suit of a different applicant who establishes that its rights have been infringed by Redbubble will depend on the right infringed (eg. copyright or trade mark), the circumstances of the infringement and the evidence, including any evidence of the surveillance and moderation policies and practices followed by Redbubble at the time any such proceeding is heard.
Concluding comments
Review of the discussion about use as a trade mark on websites outside Australia and damages will have to await another occasion.
The judicial acceptance of a notice and take down / moderation scheme for trade mark infringement is a significant development as such a scheme has been implemented in Australia only by statutory intervention in the Copyright Act 1968. The development does have echoes of a similar development in the United Kingdom (albeit in a different regulatory regime).[4]
It is important, however, to keep in mind that the Full Federal Court was very conscious of the limited impact of the infringements in this particular case and the Hells Angels’ very limited attack on Redbubble’s argument that it was not feasible yet to develop a system which did more than detect exact image matches as discussed by Perram and Downes JJ at [147] and [161] – [162].
The Hells Angels discovered several new transactions after the initial hearing on liability had been heard and successfully applied to re-open the trial to address transactions 8 to 11. ?
In dismissing Lolicel’s opposition to the registration of SIMPLY DELISH by Stanmar, Assistant Commissioner Rendle excluded evidence witnessed by a patent attorney in Australia because a patent attorney is not authorised to witness a declaration under New Zealand’s Oaths and Declarations Act 1957. The Assistant Commissioner would have dismissed the opposition even if the evidence had been allowed.
Background
Stanmore applied to register SIMPLY DELISH, TMA No. 1163933, in respect of dessert mixes, dessert mousse, dessert puddings and the like in class 30.
Lolicel opposed, claiming use of the mark by Stanmore was likely to deceive or cause confusion and the application was filed in bad faith, respectively, Trade Marks Act 2002 (NZ) ss 17(1)(a) and (2). Lolicel in effect claimed it was the owner of the trade mark and Stanmore was merely its distributor. Stanmar claimed it was the owner and Lolicel was just its contract manufacturer.
Lolicel filed a statutory declaration by its trade mark attorney, a Ms Rimmer, in support of its opposition. Most of the contents of the declaration were based on information provided by Lolicel’s trade mark attorney in South Africa and so were hearsay. Ms Rimmer’s declaration was witnessed in Brisbane Australia by its Australian patent attorney.
Stanmare did not file any evidence in answer but requested a hearing.
(After the hearing was requested, Lolicel sought to file a declaration by one of its employees which “confirmed” the contents of Ms Rimmer’s declaration. As it was filed out of time and an extension of time had not been requested, however, this declaration was excluded from the evidence.)
The declaration was inadmissible
Section 160 of the New Zealand Trade Marks Act requires evidence before IPONZ to be in the form of an affidavit or a statutory declaration in the absence of a direction to the contrary. (There was no direction to the contrary.)
The Rimmer declaration purported to have been made and witnessed under s 11 of the Oaths and Declarations Act 1957 (NZ).
Section 11(1) of the Oaths and Declarations Act 1957 provides:
A declaration made in a Commonwealth country other than New Zealand shall be made before a Judge, a Commissioner of Oaths, a notary public, a Justice of the Peace, or any person authorised by the law of that country to administer an oath there for the purpose of a judicial proceeding, or before a Commonwealth representative, or before a solicitor of the High Court of New Zealand. (emphasis supplied)
The Assistant Commissioner contrasted the specific requirements of s 11 with the terms of s 10 and s 12, the latter of which authorised officers of the armed services of a Commonwealth country, or an ally, to witness both affidavits and statutory declarations.
So it was necessary to show that the patent attorney had authority under the law in Australia to administer an oath for the purposes of a judicial proceeding.
It is clear that a patent attorney can witness a statutory declaration under Australian law – at least for the purposes of matters arising under Commonwealth laws.[1]
The Assistant Commissioner agreed with Stanmore, however, that a statutory declaration was not interchangeable with an affidavit, the truth of which has been sworn on oath or affirmation.
Moreover, it may be noted, s 6(3) of the Statutory Declarations Act 1959 (Cth) provides that the section does not authorise the use of a statutory declaration in a judicial proceeding.
As the declaration was made in Brisbane, the Oaths Act 1867 (Qld) s 16A provides:
(1)A person’s affidavit may be witnessed by any of the following persons without a commission being issued for the purpose—
(a) a justice, commissioner for declarations or notary public under the law of the State, the Commonwealth or another State;
(b) a lawyer;
(c) a conveyancer, or another person authorised to administer an oath, under the law of the State, the Commonwealth or another State;
(d) if the affidavit is witnessed outside Australia—a person authorised to administer an oath under the law of the place in which the affidavit is witnessed;
(e) another person prescribed by regulation for this subsection.
and reg. 4 of the Oaths Regulations 2022 (QLD) prescribes only “a senior police officer”.
The Assistant Commissioner was also referred to s 186 of the Evidence Act 1995 (Cth) which identifies the persons authorised to witness an affidavit for the purposes of court proceedings in the federal jurisdiction as “any justice of the peace, notary public or Australian lawyer”.
As a result, the Assistant Commissioner concluded at [38] – [41] that Lolicel’s Australian patent attorney was not authorised to witness affidavits under Queensland or Australian Federal law. Accordingly, the Rimmer declaration was not admissible in the opposition proceedings before IPONZ.
Hearsay
There was a further problem with the Rimmer declaration. Ms Rimmer had made it on the basis of information supplied by Lolicel’s trade mark attorney in South Africa. In other words, it was hearsay.
The Assistant Commissioner referred to an earlier IPONZ decision, BitFlyer Inc v Coinbase Inc, in which another Assistant Commissioner, recognising that trade mark oppositions dealt with valuable property rights, explained at [36] that hearsay evidence should be given little, if any, weight:[2]
in trade mark oppositions the Assistant Commissioners take the tribunal approach but are guided by and rely on the Evidence Act when assessing the reliability and probity of evidence. A high standard of evidence is expected.
As there was no way of separating statements made by Ms Rimmer from her own knowledge and those which were hearsay, at [52] the Assistant Commissioner concluded that Ms Rimmer’s declaration was inadmissible or of no probative weight.
The Assistant Commissioner appears to have made an exception from this ruling for invoices and emails between the parties as “business records”. At [53], however, the Assistant Commissioner considered these materials, even if admitted, were not adequate to sustain Lolicel’s grounds of opposition.
The substantive grounds
Section 17(1)(a) required the opponent to show that there was an “awareness, cognisance or knowledge” of its mark in the relevant market at the application date to found a likelihood of deception or confusion.
The business records annexed to Ms Rimmer’s declaration did not provide a sufficient foundation for this as they did not address the typical indicators of the extent of use in New Zealand such as sales volumes or advertising and promotional expenditure on the brand in New Zealand.
The s 17(2) ground required Lolicel to show that Stanmore had made its application in bad faith.
At [62], the Assistant Commissioner considered this required Lolicel to prove it was the owner of the trade mark in New Zealand when Stanmore applied to register it and it was unreasonable for Stanmore to have made the application in those circumstances.
While there were email communications between the parties that showed they had dealings with one another before the priority date, these communications left ownership of the trade mark unclear. Accordingly, this ground failed too.
Short comment
As the Trans-Tasman arrangements mean that all Australian and New Zealand patent attorneys are admitted to practise in both Australia and New Zealand, regardless of whether they are based in New Zealand or Australia, precluding patent and trade mark attorneys based in Australia from witnessing statutory declarations for use in IPONZ proceedings seems anomalous as well as inconvenient for businesses.
Statutory Declarations Act 1959 (Cth) [s 8][s8] and, for prescribed persons, see the Statutory Declarations Regulations 1993 (Cth) reg. 4 and items 107 and 111 of Sch. 2. ?
