Apple, Inc - [2015] ATMO 74

TRADE MARKS ACT 1995

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS

Re:International Registration Designating Australia 1437923(9) (IR No. 1082664) - SHAPE OF AN ELECTRONIC DEVICE- in the name of Apple, Inc.

Delegate:	Heath Wilson
Representation:	Holder: Gabriella Rubagotti of Counsel instructed by Ruth Horvai of Baker & Mackenzie.
Decision:	2015 ATMO 74 Application to be heard under regulation 17A.24 of the Trade Marks Regulations 1995 – ground for rejection under section 41 considered – IRDA rejected.

Background

On 14 June 2011, Apple Inc. (‘the Holder’) applied for an extension of protection to Australia of an international trade mark registration (no. 1082664). The trade mark consists of the shape of an electronic device in relation to class 9 goods. The current details of the resulting International Registration Designating Australia (‘IRDA’) are:

Trade Mark No. 1437923

International Registration No. 1082664

Trade Mark:

‘the Trade Mark’

Endorsements:

Mark Description: The mark consists of the configuration of a rectangular handheld mobile digital electronic device with rounded corners that contains a speaker slit at the top of the device and a circular home button in the middle at the bottom of the device with a concave aspect to it. The matter shown in broken lines is not part of the mark.
Convention priority claimed: 19 April 2011, United States of America, No 85299118 in respect of HANDHELD MOBILE DIGITAL ELECTRONIC DEVICES COMPRISED OF A MOBILE PHONE, DIGITAL AUDIO AND VIDEO PLAYER, HANDHELD COMPUTER, PERSONAL DIGITAL ASSISTANT, ELECTRONIC PERSONAL ORGANIZER, ELECTRONIC NOTEPAD ELECTRONIC CALENDAR, ELECTRONIC BOOK READER, CALCULATOR, AND CAMERA, AND CAPABLE OF PROVIDING ACCESS TO THE INTERNET AND SENDING AND RECEIVING ELECTRONIC MAIL, DIGITAL AUDIO, VIDEO, TEXT, IMAGES, GRAPHICS AND MULTIMEDIA FILES in class 9.

Specification of Goods:

Class 9: Handheld mobile digital electronic devices comprised of a mobile phone, digital audio and video players, handheld computers, personal digital assistant, electronic personal organizer, electronic notepads, electronic calendars, electronic book readers, calculator, and camera, and capable of providing access to the Internet and sending and receiving electronic mails, digital audio, video, text, images, graphics and multimedia files

The IRDA was examined as required under regulation 17A.12 of the Trade Marks Regulations 1995 (‘the Regulations’)[1]. Regulation 17A.28 indicates that the grounds for rejecting an IRDA are set out under sections 39 to 44 of the Trade Marks Act 1995 (‘the Act’) [2]. At the examination stage, the examiner in this matter identified a ground for rejection under section 41(5) of the Act.
[1] The Intellectual Property Legislation Amendment (Raising the Bar) Regulation 2013 (No. 1) came into effect on 15 April 2013. As filing date for this application is earlier, references in this decision to the Regulations are as they stood prior to the amendments.
[2] The Act as it stood prior to amendments to that section brought about by the Intellectual Property Legislation Amendment (Raising the Bar) Act 2012. (Schedule 6, Item 113).
The examiner maintained that ground for rejection in five examination reports and after considering the Holder’s evidence of use. The evidence comprised:
·the declaration of Thomas R. La Perle (Director of the Legal Department of the Holder) made 28 March 2014 with annexures TRL-1 to TRL-39 (‘the La Perle declaration’) and
·the declaration of Robert Anthony Arnold (partner of Baker & McKenzie) made 20 November 2014 with annexures RAA-1 to RAA-2 (‘the Arnold declaration’).
The Holder took the opportunity of requesting to be heard under Regulation 17A.18.
I heard the matter as a delegate of the Registrar of Trade Marks in Sydney on 19 June 2015. Gabriella Rubagotti of Counsel appeared on the Holder’s behalf instructed by Ruth Horvai of Baker & Mackenzie. Ms Rubagotti also provided two sets of written submissions and relied on the evidence supplied during examination.

The Law

Section 41 of the Act relevantly provided:

41Trade mark not distinguishing applicant’s goods or services
(1)…
(2)An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (designated goods or services) from the goods or services of other persons.
Note:For goods of a person and services of a person see section 6.

(3)In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.
(4)Then, if the Registrar is still unable to decide the question, the following provisions apply.
(5)If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:
(a)the Registrar is to consider whether, because of the combined effect of the following:
(i)the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;
(ii)the use, or intended use, of the trade mark by the applicant;
(iii)any other circumstances;
the trade mark does or will distinguish the designated goods or services as being those of the applicant; and
(b)if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons; and
(c)if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken not to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons.
Note 1:For goods of a person and services of a person see section 6.
Note 2:Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).

(6)If the Registrar finds that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, the following provisions apply:
(a)if the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant—the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other persons;
(b)in any other case—the trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons.
Note 1:Trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate:
(a) the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; or
(b) the time of production of goods or of the rendering of services.
Note 2:Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).

Reg 17A.24 of Regulations provided:

17A.24Final decision on examination
(1)The Registrar must, after the examination, accept the IRDA unless he or she is satisfied that:
(a)it is not in accordance with this Division; or
(b)there are grounds for rejecting it.

(2)The Registrar may accept the IRDA subject to conditions or limitations.
(3)The Registrar must reject an IRDA, in whole or in part, if the Registrar is satisfied that:
(a)it is not in accordance with this Division; or
(b)there are grounds for rejecting it, in whole or in part.

Discussion

A presumption of registrability is applicable when determining whether a trade mark is inherently adapted to distinguish the designated goods under section 41(3).[3] The authorities make it clear that once the Registrar is “unable to decide the question” under section 41(4) and the trade mark falls for consideration under either sections 41(5) or 41(6), the presumption of registrability is no longer applicable.[4] In those instances, the Registrar must be ‘satisfied’ (s41(5)) or the Holder must ‘establish’ (s41(6)) that the trade mark is capable of distinguishing.
[3] Apple Inc. v Registrar of Trade Marks [2014] FCA 1304 at [30]-[31]
[4] Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891 at [21] (“Guylian”)
Kitto J set out the relevant test for determining whether a trade mark is inherently adapted to distinguish the goods in Clark Equipment Co v Registrar of Trade Marks (‘Clark Equipment’)[5]:
[T]he question whether a mark is adapted to distinguish 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.
[5] Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511 at 513–14; [1965] ALR 344 at 345–6. The test was recently affirmed by the High Court in Cantarella Bros Pty Limited v Modena Trading Pty Limited [2014] HCA 48 at [59].
The test for determining the inherent adaptation of a trade mark to distinguish designated goods and services is equally applicable to shape trade marks as it is to trade marks consisting of a word.[6] Specifically, in relation to a chocolate seahorse-shaped trade mark, Sundberg J said in Guylian:[7]
The ultimate question on the issue of inherent adaptation is whether a sign - in this case, a shape - possesses any ordinary significations and, if it does, whether or not other traders might think of the shape and want to use it for those ordinary significations in a manner which would infringe a registered mark in respect of the sign. In cases where a shape depicts a known object or concept (cf. wholly concocted or ambiguous shapes), and is therefore likely to signify the same to most if not all consumers, then a subsidiary question is whether the shape is nevertheless sufficiently distinctive or unique so that other traders wishing to represent the same or a similar concept will remain free to do so without infringing the mark, that is, without requiring use of the same shape or one substantially identical or deceptively similar. An important consideration in all of this is the nature of the goods for which the shape mark is to be used.
[6] Kenman Kandy (Australia) Pty Ltd v Registrar of Trade Marks [2002] FCAFC 273; (2002) 122 FCR 494; (2002) 56 IPR 30; (2002) AIPC 91-817 at [146].
[7] Guylian at [75].
Before I consider the particular elements comprising the Trade Mark as a whole, I will firstly address another argument that was put forward by the Holder in support of the inherent capacity of the Trade Mark to distinguish the goods.

Prior Registrations

Ms Rubagotti indicated that the Holder owns the following trade mark registrations:

Registration no. 1370765 Registration no. 1235451

Priority Date: 23 November 2009 Priority Date: 28 June 2007

Ms Rubagotti argued that as the use of a shape can infringe a registration of a 2-dimensional representation[8], it follows that the existence of the above registrations makes it unlikely that other persons trading in the relevant class 9 goods would, without improper motive, wish to use the Trade Mark on or in relation to their goods.
[8] Coca-Cola Co v All-Fect Distributing Co trading as Millers Distributing Co [1998] FCA 1638.
For a number of reasons I do not agree with that argument. Clark Equipment at [345] provides:
That ultimate question must not be misunderstood. It is not whether the mark will be adapted to distinguish the registered owner’s goods if it be registered and other persons consequently find themselves precluded from using it. The question is whether the mark, considered quite apart from the effects of registration, is such that by its use the applicant is likely to attain his object of thereby distinguishing his goods from the goods of others.
Similarly, the question of whether a particular trade mark is inherently adapted to distinguish its designated goods cannot be answered by highlighting the existence of other possibly similar trade mark registrations. Each trade mark must be assessed on its own merits and “Marks may, in the past, have been wrongly registered. It would be an unwarranted distraction from the task at hand to investigate, in a particular case, whether they were or not.”[9]
[9] Ocean Spray Cranberries Inc. v Registrar of Trade Marks (2000) 47 IPR 579; [2000] FCA 177

Elements of the Trade Mark

In a case concerning trade mark infringement, Foster J in Sebel Furniture v Acoustic & Felts[10] referred to Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd[11] stating (emphasis added):
A shape which is dictated by the nature of the goods or by the need to achieve some particular technical result or functional outcome cannot operate as a trade mark.
In order to function as a trade mark, the shape must be something which is extra or which is added to the inherent form of the particular goods as something distinct which can denote origin. A shape cannot function as a trade mark if it is something that other traders may legitimately wish to use either because it is inherent to the particular goods (ie it is of their nature) or because it provides some technical or functional benefit to the goods.
[10] Sebel Furniture Limited v Acoustic & Felts Pty Limited [2009] FCA 6; (2009) 80 IPR 244; (2009) AIPC 92-328 at [144].
[11] Koninklijke Philips Electronics NV v Remington Products Australia Pty Limited [2000] FCA 876; (2000) 48 IPR 257; (2000) AIPC 91-573.
In the current matter, the features of the Trade Mark were described by Ms Rubagotti in her submissions as follows:

It is a 3-dimensional rectangular shape;
The corners of the shape are rounded; and
The upward facing surface features an oblong at the top and a circle with a concave aspect at the bottom.

The first purported feature does nothing to confer the Trade Mark with any inherent adaption to distinguish handheld electronic devices. Stating the fact that it is 3-dimensional merely acknowledges that the Trade Mark is a shape. In a similar vein, the fact that the particular shape is rectangular does not instill the Trade Mark with distinctiveness in the context of the designated goods. A rectangle is the most commonly used shape for handheld mobile digital electronic devices.
Ms Rubagotti proposed that the rounded corners of the Trade Mark were purely aesthetic rather than functional. I have difficulty with this proposition and it is quite simple to observe that rounded corners are a functional feature on a handheld mobile digital electronic device. By way of analogy, in Reemtsma Cigarettenfabriken GmbH[12], Delegate Williams said of a trapezium-shaped cigarette packet:
I do not, as I said at the hearing, accept that the mere flattening of the front side corners of a cigarette pack endows that package with any inherent trade mark merit. It is reasonable and normal for an object intended to be carried on the person to be constructed to allow it to be less obtrusive in a pocket or under a suit: holsters for pistols and hip flasks for liquor are prime examples. In the present social climate, where smoking is seen by some, perhaps many, to be antisocial, I do not find it at all remarkable that a manufacturer would move to make the familiar bulge of a cigarette packet more discreet. That change is entirely functional and the fact that the flattening of the corners appears to better approximate the radius of the cigarettes at the two ends of the front row is entirely predictable. Similarly, the fact that the back of the pack does not have the flattened corners is readily explicable on grounds of function, to allow the easier and more durable operation of the flip-top packaging. The shape, to put it simply, is entirely functional.
[12] [2001] ATMO 32.
Rounded corners on a handheld electronic mobile device are also entirely predictable, but for slightly different reasons. The rounded corners do make the device less obtrusive if carried in a pocket or handbag. An electronic device with sharp pointed corners may also damage other objects in a bag (or be more prone to damage itself) and case protectors may not be able to be affixed to the device with as much ease as a device with rounded corners. There may a minor aesthetic element to rounded corners appearing on a device, but I find that it is predominantly functional and I am not convinced that it provides the Trade Mark with any inherent adaptation to distinguish the designated goods.
In fact, the only notable and what appear to be (in the main) aesthetic elements are the oblong at the top and the circle with a concave aspect at the bottom. On the device, they are the speaker and the ‘home’ button respectively. These minor elements (particularly the concave circle) provide the Trade Mark with limited inherent adaption to distinguish, but are not sufficient when considering the Trade Mark as whole to render it prima facie inherently adapted to distinguish. I find myself unable to decide on that basis alone whether the Trade Mark is capable of distinguishing (s41(4)). Accordingly, I am therefore in agreement with the examiner’s conclusion that it is appropriate to assess the Trade Mark under the provisions of s41(5) of the Act.
Having made the above finding it has been accepted that, within section 41(5), there are varying levels of inherent adaption to distinguish. Section 41(5)(a)(i) provides support for that proposition. I find that in terms of the inherent adaption to distinguish the designated goods, the Trade Mark is on the lower end of the scale.
The onus is on the Holder to satisfy the Registrar (under s41(5)) via evidence of use, intended use or other circumstances that the Trade Mark does or will distinguish.

Evidence of Use

The Holder’s submissions mentioned the examiner’s view of the Holder’s evidence, noting specifically that the examiner had identified two bases for rejecting the Holder’s evidence. The bases were that the evidence did not demonstrate continuous use and also that the demonstrated use was not of the Trade Mark simpliciter but rather accompanied by other identifying trade marks. The Holder submitted that the first basis was resolved and the second cannot be maintained. However, I must consider this matter and the evidence of use afresh. My decision is not a review of the examiner’s approach and nor I am not bound in any way to follow it. If that were the case, a request for a hearing under section 33(4) of the Act would be of no utility, as the outcome would necessarily be the same.
With the above factors in mind, it is axiomatic that the Holder is a well-known company in Australia, especially in this particular industry. However, this fact alone has no direct bearing on whether the Trade Mark does or will distinguish the designated goods if the nature and/or extent of use is lacking.

The La Perle declaration indicates that the Holder announced the iPhone device in June 2007, describing it as a “small and lightweight handheld device [with] sophisticated mobile functions, media storage and playback”. The Holder’s iPhone had a glass and stainless steel case. Since that time, there have been a number of variations on the iPhone. Having said that, the relevant physical elements of all versions are substantially the same; that is they all have the speaker slit at the top of the device, the rounded edges and the circular home button at the bottom with a concave aspect to it.
For the avoidance of doubt, the Holder declares that the Trade Mark is the general shape of Apple’s iPhone 4 and iPhone 4S devices[13] introduced by Apple on 24 June 2010 and 14 October 2011 respectively.
[13] - Absent certain features (which I will address in my forthcoming assessment).
It must be remembered that the broken lines in the representation of the Trade Mark do not form part of it. As a result, the Trade Mark comprises neither the screen itself, nor the buttons on the side, nor the in-built camera and ports at the bottom of the device. The Trade Mark is (to reiterate) an oblong with rounded corners, a speaker slit at the top and a concave circle at the bottom. The issue is whether these elements used in conjunction do operate or can operate as a trade mark.
The evidence makes it apparent that sales of the Holder’s product on launch in Australia (and the subsequent sales) were overwhelming. That said, due to the nature of the Trade Mark, the specific question I must answer requires more than substantial sales of the device.
The difficulty with assessing evidence of the shape of a device which is constantly being refined is determining whether the shape absent certain features would perform that task of demonstrating the capability of the Trade Mark to distinguish the goods. The Holder’s advertisement for one of its products displays the phone and states “iPhone 4: This changes everything. Again”. The thinness of the phone and also the functional features on the side are emphasised in the advertisements but again those features do not form part of the Trade Mark. In most advertisements, it is not the general shape which is given emphasis, but what the Holder’s product can actually do when compared its previous models (or its competitors’ models). I can find little or no evidence of emphasis on the features of the Trade Mark.
As I have observed earlier, the element that may best be described as adding an element of distinctiveness to the Trade Mark is the concave circle “home” button towards the bottom of the shape. Again, although this element appears in advertisements, it is not specifically extolled as a feature by the Holder. Importantly, the Holder’s evidence demonstrates that on the iPhone this feature has a rounded square device appearing in the centre of it. I must be satisfied that absent that rounded square device, the Trade Mark as a whole is capable of distinguishing the designated goods.
Some of the submissions from the Holder argue that consumers identify acquisition of the device by reference to the shape itself.[14] While there are pictures of consumers holding the iPhone there is no instance (for example) of a consumer referring to the specific shape itself or to the physical features relevant to this matter (i.e. the round corners of their device, or the concave circular button, or the speaker towards the top of the device).
[14] La Perle declaration (paragraph 60), exhibit TRL-31.
The contents of the Arnold declaration affirm consumer recognition in Australia of the Holder’s iPhone 4. The declaration annexes the results of a survey conducted amongst Australians aged 18 to 64 years. The survey was of 1200 Australians and took place over 11-14 September 2014.
The survey supplied a picture of the Trade Mark as it appears on the Register to the participants as it appears in the first paragraph of this decision and asks the question “Now looking at the picture above. Do you know what this is?” 60% of responses to that question were either “Apple iPhone”, “iPhone”, “Apple”, “iPod” or “iPad”. Despite some apparent confusion over which device of the Holder it was, the recognition factor of the shape belonging to a particular trader is quite high.
If the features in dotted lines had been omitted from the representation (as per the endorsement) to reflect the true nature and scope of the Trade Mark, it is likely that the recognition amongst Australian consumers would have been significantly lower. In addition, although post filing date evidence may be taken into account for the purposes of section 41(5), it is worth noting that the survey was conducted over three years from the date of filing.
With regard to survey evidence generally, in Apple Inc. v Registrar of Trade Marks[15]. Yates J considered the difficulty with a survey that establishes an ‘association’ between a trade mark and a trade mark applicant. That decision also referred to other decisions concerning shape and colour trade marks and the approach to survey evidence taken by the courts.[16] Following that approach in the current matter, it is one thing for the public to recognise an association between the Holder and a depiction of a mobile electronic device. It is another thing to say that those members of the Australian public attribute trade mark significance to the shape itself.[17] For the above reasons, the contents of the Arnold declaration do not satisfy me that the Trade Mark does or will distinguish the designated goods as being those of the Holder.
[15] [2014] FCA 1304 at [224] – [230]
[16] Woolworths Ltd v BP plc (No 2) [2006] FCAFC 132; (2006) 154 FCR 97, Guylian at [95] and Societe Des Produits Nestle SA v Unilever plc [2003] RPC 35.
[17] See Apple Inc. v Registrar of Trade Marks (supra) at [230].
I find it likely that a majority of Australians would recognise the Holder’s iPhone 4 device with all of its elements in combination. The popularity of the product in Australia (demonstrated by the Holder’s evidence) generates this level of recognition. I am not satisfied that, stripped of most of the aesthetic elements that would likely render the Holder’s mobile device shape memorable as a whole, the Holder has demonstrated the Trade Mark does or will distinguish the goods.
I find that there is a ground for rejection under section 41(5) of the Act, and under those circumstances, regulation 17A.24 provides that the Registrar must reject the IRDA.

Decision

As delegate of the Registrar of Trade Marks, I reject IRDA no. 1437923.

Heath Wilson
Hearings Officer
Trade Marks Hearings & Oppositions
17 August 2015