capable of distinguishing

Primary Health Care is not registrable as a trade mark

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You will probably not be surprised to discover that PRIMARY HEALTH CARE is not registrable as a trade mark. You may, however, be surprised that the successful challenger was the Commonwealth of Australia.

Primary Health Care Limited (PHC) applied to register PRIMARY HEALTH CARE and

Primary Health Care logo
Primary Health Care logo

in class 35 for:[1]

Medical centre business management; medical centre business administration; service provider to medical professionals, namely provider of: administrative support services, billing and invoicing services, reception and telephone answering services, patient booking services, patient file management services including management of access to patient files, typing services, account-keeping and book-keeping services, preparation of business reports, systemisation of information into computer databases, professional business consultancy, computerised file management, business and information management services, ordering services, processing of purchase orders.

What PHC did was it bought or built a building for use as a medical practice. It set up the rooms and facilities and provided the staff such as receptionists, book keepers etc. Then it contracted with medical practitioners (mostly GPs) to work from the medical centre, using the staff and facilities PHC made available to provide their services. PHC argued that it used its trade marks only in providing those services to the medical practitioners and the trade marks were not used by it in providing medical services to the medical practitioners’ patients. Thus, it said, it was not using the trade marks for medical services, only for business management and administration services – services for which the expression PRIMARY HEALTH CARE was not an apt description. At [53]:

The applicant’s case is that the Services are all to be provided to health care professionals and are not to include clinical or medical care by those professionals to patients.

This argument was predicated on PHC’s clinics/centres not being called or promoted to the public as PRIMARY HEALTH CARE centres.[2]

Jagot J rejected PHC’s contention. Her Honour accepted that PHC’s marketing was directed to health care professionals rather than the public. Her Honour also accepted that the health care professionals provided the health care services to the patient and jealously guarded their clinical independence in deciding what clinical care to provide to the patient. So PHC was not actually providing medical or health care services to the patients per se. However, it was unrealistic to treat the services PHC provided as being services provided only to the health care professionals. They were also provided to the public. Jagot J explained what her Honour had in mind by reference to the medical centre’s receiptionist – who was employed by PHC. For example at [55] – [59]:

…. the person paying for the services, the medical professional, is not the only person who receives the services or, at the least, is not the only person concerned with the services. The Services include reception and telephone answering services, patient booking services, patient file management services, information management services, billing and invoicing services, computerised file management, and ordering services, all said to be “to medical professionals”. (emphasis supplied)

Assume then a member of the public who wishes to see a GP who is contracted to and has a practice located in one of the applicant’s medical centres (leaving aside, for the moment, the issue about Idameneo and how the marks have in fact been used). The patient calls the centre and speaks to a receptionist. On the applicant’s case, in answering the call, the receptionist is providing a service only to the GP the patient might wish to see and not to the patient. This is untenable. The GP who ultimately sees the patient pays for the service but the service cannot be said to be a service to the GP only. It is also a service to the patient, the cost of which is borne by the GP, at least insofar as the GP does not seek to recoup those costs in the consultation fee. ….

As a consequence, Jagot J found:

[64] As such, the focus of the applicant’s case is off target and at odds with the evidence. The consequences of this disconnect run through every aspect of the case. First, the Services cannot be considered as if they exist in isolation because that is not how the Services are provided. Second, no matter how often the applicant repeats it, I am unable to accept that the Services are directed only to GPs and health professionals; the public and other participants in the health care sector are provided with some of the Services and are potentially concerned with all of the Services. ….

[65] … the reality is that, at least insofar as the Services are concerned, the applicant is providing services to medical professionals within its centres, to patients of those centres, and to all other participants in health care who interact with any medical professional in one of its centres. The fact that the applicant (or Idameneo) receives payment for the provision of the Services directly from the medical professional does not mean that the Services are provided only to the medical professional. Nor does the fact that medical professionals understand that they alone provide clinical or medical services to patients mean that the Services are not provided to patients. The reasoning involved seems to involve a false syllogism: (i) only medical professionals provide clinical services to patients, (ii) the Services are not clinical services, (iii) therefore, the Services are necessarily not services to patients. Propositions (i) and (ii) may be accepted, but they do not lead to proposition (iii).

Therefore, when deciding what the ordinary signification of the words PRIMARY HEALTH CARE was, the relevant public was not just the health care professionals to whom the services were promoted but all other participants in the health care system including patients and potential patients.

For the public so defined, Jagot J then went on to find that the expression PRIMARY HEALTH CARE was directly descriptive and so not inherently adapted to distinguish at all under the old form of s 41(3) or capable of distinguishing under s 41(5) or in fact distinctive under s 41(6).[3]

At first blush her Honour’s ruling that the Services were being provided to the public (other than the medical practitioners) might seem questionable because, so far as I can make out from the judgment, no member of the public (apart from the medical practitioners of course) actually sees the sign PRIMARY HEALTH CARE being used as a trade mark. For example, patients were not given bills or receipts or prescriptions with PRIMARY HEALTH CARE emblazoned on them. Nor does it seem that the receptionist (or other ancillary staff) wore uniforms with the sign on them. If keywords are not used as a trade mark because they are “invisible”, one might think that the unseen expression PRIMARY HEALTH CARE was also not being used as a trade mark for the services provided to the public. As the Commonwealth pointed out, however, PRIMARY HEALTH CARE could be used on, for example, the uniforms if the trade mark were registered. So, taking into account fair notional use renders the “invisiblity” argument untenable.[4]

Perhaps the crucial consideration is that the services being provided by the receptionist and the other “ancillary” staff are just so closely bound up with the health care services being provided by the medical practitioner to be part of those services or taking their character from the primary services being offered at the clinic. This indeed appears to be what her Honour had in mind. So for example, her Honour said at [119]:

there is an unreal distinction at the heart of the applicant’s case between the provision of the Services and the provision of clinical or medical care. The distinction is unreal because the Services are part of the overall service a patient receives when attending a medical centre and, to some extent, are also part of the medical or clinical care a patient receives. It is part of medical care that a GP be able to access clinical records for a patient. It is part of medical care to ensure new records are accessible in the future. It is part of medical care for a patient’s referral to be properly recorded, stored and managed. It is part of medical care for the centre to have available necessary medical supplies. ….

and at [121]:

in the real world context in Australia (at least) the Services are inextricably bound up with the provision of medical and clinical services by general practitioners and allied healthcare professionals, including through medical centres and medical practices – they are ‘part and parcel’ of the practice of general medicine and allied healthcare in the community, of primary health care.

That way of looking at things, with respect, seems in accord with the reasons why the Full Court in the Chifley Tower case rejected the argument that an hotel was engaged in providing property management services.

Jagot J went on to find that an additional ground for refusing registration was that the trade marks were deceptive or confusing. They were deceptive or confusing because, although they were so closely bound up with the provision of medical services, the specification of services did not include medical services. On the other hand, use of the trade marks would be congtrary to law in contravention of s 18 of the Australian Consumer Law because use of the mark misrepresented that PHC provided medical services and further that PHC was responsible for the medical services provided by the medical practitioners at the centres.

Primary Health Care Limited v Commonwealth of Australia [2016] FCA 313 (Jagot J)

  1. The “Services”. In the course of the proceeding the specification of services went through a number of revisions. This is just the starting one, but it indicates the nature of what PHC wanted registration for.  ?
  2. There was a factual dispute whether PHC used PRIMARY HEALTH CARE as the name of 3 or 7 of its medical centres, but this seems to have been regarded as essentially de minimis.  ?
  3. Putting a simple box around the words didn’t improve matters.  ?
  4. This led PHC in one of its revised specifications of services to seek to “disclaim” such use under s33(2) and s 55(1)(b).  ?

ZIMA trade mark again

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Tim Golder, the solicitor who successfully secured the ZIMA trade mark registration, has a 6 minute podcast:

  1. explaining why they succeeded and
  2. offering some useful tips on how to stop such sign becoming generic.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The Raising the Bar Bill

3 Comments / Copyright, Designs, Enforcement, IP generally, Patents, Trade marks / By / / , , , , , , , , , , ,

Senator Carr introduced the Intellectual Property Laws (Raising the Bar) Bill 2011 into Parliament today.

Press release

Download the text of the Bill and EM from here (choose your own format).

You will remember that (according to the Press Release) the main objects of the Bill include:

  • raising patent standards to ensure Australian innovators are well placed to take their inventions to the world;
  • increasing penalties for trade mark counterfeiters;
  • improvements to border security measures for goods that infringe copyright and trade marks;
  • providing free access to patented inventions for researchers; and
  • cutting red tape and delays when seeking an IP right.

While there have no doubt been modifications to the text of the Exposure Draft (and Patentology flags a big change to the transitional provisions for the new patentability standards), you can get a very good feel for what the various parts of the Bill are trying to achieve:

in relation to patents from Dr Summerfield’s 8 part series over at Patentology:

  1. Part 1: inventive standard
  2. Part 2: usefulness
  3. Part 3: provisional specifications
  4. Part 4: enablement
  5. Part 5: claims supported by description
  6. Part 6: experimental use
  7. Part 7: miscellanea including standard of proof
  8. Part 8: transitional

Kim Weatherall also commented on a number of aspects, exploring in particular the (proposed) trade mark criminal offences.

You do need to bear in mind that these commentaries were on the text of the Exposure Draft and it was intended that anomalies identified through the Exposure Draft would be corrected in the Bill so, as I have already noted, there will be changes. Nonetheless, these comments should give you a good fell for what was being intended and issues that might be thrown up.

As you will see from the commentaries on the exposure draft, there are a host of issues to be considered. Time doesn’t permit anything but a cursory attempt on a couple of points here:

Item 113 of Sch 6 will replace the current s 41 of the Trade Marks Act (requiring a trade mark to be capable of distinguishing) with a new provision intended to reverse Blount and ensure that there is a presumption that a trade mark is registrable. It does this by requiring the Registrar to be satisfied that the trade mark is not capable of distinguishing before the Registrar can reject the application on this ground.

So clause 41(2) says “A trade mark is taken not to be capable of distinguishing … only if ….”

(Now I look at it, I wonder how long before it will be before someone tries to argue that “taken not to be capable of distinguishing” means something different to (and less than) “is not capable of distinguishing”. Oh well. Surely that one would be dispatched over the fence for six?)

While the Bill does seek to change the standard of proof against patent applications and patent oppositions from the existing “practically certain to fail” or “clear” type standard to the usual “balance of probabilities (see e.g. items 14 and 15 of Sch 1), no such amendment is proposed for trade mark oppositions. Therefore, the current state of uncertainty on this issue will continue (contrast e.g. Hills v Bitek at [43] – [55] to Sports Warehouse v Fry at [26] – [40]) , even though the school of thought favouring the “practically certain” or “clear” standard was imported from the Patents Act.

The bill will also introduce a whole new regime of oppositions to the registration of trade marks.

Item 18 of Sch. 3 will replace s 52 so that there is an obligation to file a Notice of Opposition which the Registrar, not the opponent, will serve on the applicant. Item 19 will introduce a new s 52A. This will require an applicant to file a notice of intention to defend or the application will lapse.

According to the EM, the regulations (when they are promulgated) will include power for the Notice of Opposition to specify the particulars of the grounds of opposition. The EM explains:

Opponents are currently required to state the grounds on which they intend opposing an application when they file their notice of opposition. However, they are not required to set out the particulars of those grounds. Frequently, this means that the opponent sets out all possible grounds, whether or not they have any intention of relying on them. As a result, the trade mark applicant may be faced with a number of grounds to deal with and no indication of which are key to the opposition until late in the opposition proceedings and sometimes not until the hearing

makes it difficult for the applicant to prepare their case. It also increases costs as the applicant is obliged to prepare a case in response to all grounds raised in the statement of grounds, including those on which the opponent may no longer rely.

The amendment addresses this problem by allowing for regulations to be made to require the opponent to file a statement of particulars of the grounds on which they intend to oppose. This will help focus oppositions earlier, reducing costs and unnecessary effort for the applicant.

The EM talks of the regulations conferring a power to require particulars. Whether this will be a discretionary power to be exercised on a case by case basis or an obligation on all opponents will need to await the terms of the regulations themselves. For example, the EM on items 24 and 25 states that opponents will be required to file both statements of grounds and particulars and  the last paragraph of the EM on item 17 states that the particulars will be required to be filed within 1 month of the filing of the Notice of Opposition.

The regulations will also apparently include a power to amend the statement(s) of grounds and particulars. However, the EM on items 24 and 25 states:

The regulations will only permit the opponent to amend the statement of grounds and particulars under tightly controlled circumstances.

The Federal Magistrates Court will get original jurisdiction in matters under the Designs Act and the Trade Marks Act alongside its existing original jurisdiction in copyright and (what used to be called) trade practices matters.

 

 

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