Australian Char Pty Ltd v the Kingsford Products Company LLC

[2018] ATMO 5

TRADE MARKS ACT 1995

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

Re:Opposition by Australian Char Pty Ltd to application under section 92 of the Act by The Kingsford Products Company, LLC to remove trade mark number 492977 (4) –MATCHLITE- in the name of Australian Char Pty Ltd.

Delegate:	Bianca Irgang
Representation:	Opponent: Siobhan Ryan of counsel instructed by Griffith Hack. Non-use applicant: Written submissions by Fisher Adams Kelly Callinans
Decision:	2018 ATMO 5 Section 96 opposition–no use shown during the relevant period of the trade mark on class 4. Registrar’s discretion not used. Trade Mark to be removed.

Background

1. This matter is an opposition proceeding under section 96 of the Trade Marks Act 1995 (‘the Act’) in which by an application under subsection 92(4)(b) filed on 17 May 2016, The Kingsford Products Company, LLC (‘the non-use applicant’) has sought the removal from the Register of the trade mark (‘Trade Mark’) appearing below in respect of the goods in class 4 for which it is registered:

Trade mark:  MATCHLITE

Trade mark number:  492977

Date of registration:             11 August 1988

Goods:Class 4: Solid fuel and illuminants and all other goods in this class                   

1. Australian Char Pty Ltd (‘the opponent’) filed a Notice of Intention to Oppose Removal on 16 June 2016. The statement of grounds and particulars filed on 15 July 2016 asserted that the ground on which the removal applicant relied was not relevant because the opponent or an authorized user had used the Trade Mark as registered or with additions and alterations not substantially affecting its identity, in Australia on the relevant goods during three year period ending on 17 April 2016 (“the relevant period”).  

2. On 25 August 2016 the non-use applicant filed their Notice of Intention to Defend. The parties then commenced filing evidence in accordance with the Trade Mark Regulations 1995 (‘the Regulations’).

3. The matter came before me, as a delegate of the Registrar of Trade Marks, at a hearing in Canberra on 20 October 2017. Written submissions were prepared by Fisher Adams Kelly Callinans on behalf of the non-use applicant. The opponent was represented by Siobhan Ryan of counsel instructed by Griffith Hack.

Legal Framework

1. Part 9 of the Act governs the removal of trade marks from the Register for non-use. The sections of that part which are most relevant to the case in hand are sections 92, 96, 100 and 101.

2. Section 92 provides, inter alia, that a person may apply to the Registrar to have a trade mark removed from the Register because it has not been used for a continuous period of three years. The removal application must be in accordance with the Regulations[1] and may be made in respect of any or all of the goods in respect of which the Trade Mark is registered. Subsection 92(4)(b) as it is relevant to this case provides the following:

   (4) An application under subsection (1) or (3) (non‑use application) may be made on either or both of the following grounds, and on no other grounds:

   [1] Regulations 9.1 to 9.4 are relevant here.

   …

   (b) that the trade mark has remained registered for a continuous period of 3 years ending one month before the day on which the non‑use application is filed, and, at no time during that period, the person who was then the registered owner:

   (i) used the trade mark in Australia; or

   (ii) used the trade mark in good faith in Australia;

   in relation to the goods and/or services to which the application relates.

3. As the Registrar’s delegate observed in Courier Luggage Pty Ltd v Wenger SA Inc[2]:

   Section 100(1) of the Act provides that the opponent bears the onus of rebutting the allegation made against it under s92(4) which it may do by, inter alia, establishing that the trade mark, (or, per section 100(3)(a), the trade mark with additions or alterations not substantially affecting its identity), was used by the registered owner in good faith during the relevant period. I proceed on the basis that the relevant standard of proof is on the balance of probabilities.

   The required use is as a trade mark, that is to say it is as a badge of origin in that it indicates a connection in the course of trade between the goods and the person who applies the mark to the goods: for example see E&J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144 at [41] – [43].

   The use must be genuine commercial use in accordance with the test in Imperial Group Ltd v Philip Morris & Co [1982] FSR 72. A single bona fide use of the trade mark during the non-use period may be sufficient to resist an application for removal: Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261; (2001) 51 IPR 149 at [17]. However, Wilberforce J, in Nodoz Trade Mark (1962) RPC 1 (Nodoz) at 7, said that if a registered owner relies on one single act of use of the trade mark, then that single act ought to be established by “if not conclusive proof, at any rate overwhelmingly convincing proof.”

   The tribunal may not be persuaded by evidence that is solely from the internal files of the opponent: Nodoz, supra; or of a circumstantial nature: Trina Trade Mark [1977] RPC 131; although one invoice, if genuine, may suffice: Geo W McPherson v Remington (1999) 47 IPR 636.

   [2] [2015] ATMO 10

4. Further, section 101 of the Act deals, inter alia, with the Registrar’s discretion:

   Determination of opposed application—general

   (1) Subject to subsection (3) and to section 102, if:

   (a) the proceedings relating to an opposed application have not been discontinued or dismissed; and
   (b) the Registrar is satisfied that the grounds on which the application was made have been established;
   the Registrar may decide to remove the trade mark from the Register in respect of any or all of the goods and/or services to which the application relates.

   (2) Subject to subsection (3) and to section 102, if, at the end of the proceedings relating to an opposed application, the court is satisfied that the grounds on which the application was made have been established, the court may order the Registrar to remove the trade mark from the Register in respect of any or all of the goods and/or services to which the application relates.

   (3) If satisfied that it is reasonable to do so, the Registrar or the court may decide that the trade mark should not be removed from the Register even if the grounds on which the application was made have been established.

   (4) Without limiting the matters the Registrar may take into account in deciding under subsection (3) not to remove a trade mark from the Register, the Registrar may take into account whether the trade mark has been used by its registered owner in respect of:

   (a)  similar goods or closely related services; or
   (b)  similar services or closely related goods;

   to those to which the application relates.

   Note 1:       If the registered owner of the trade mark has authorised another person to use it, any authorised use of the trade mark by that person is taken to be a use of the trade mark by the registered owner (see subsection 7(3)).

   Note 2:       For registered owner see section 6.

5. In Pioneer Computers Australia Pty Ltd v Pioneer KK[3]  Bennett J made the following observations concerning the Registrar’s discretion:

   [3] [2009] FCA 135; (2009) 176 FCR 300; (2009) 80 IPR 38; [2009] AIPC 92-354

   [167] The discretion under s 101(3) is a broad discretion to decide not to remove a trade mark from the Register or not to carve out some of the goods and services for which the mark is registered, even if s 92 grounds have been made out, if the Court is satisfied that it is reasonable to do so. Irrespective of the lack of use of the trade marks on the removal goods and the removal services in the relevant period, there is a discretion not to alter the registrations.

   [168] In Kowa Company at [98], Lander J rejected the submission that a party seeking the exercise of the discretion needs to show “exceptional circumstances”. In E & J Gallo at [198], Flick J agreed with Lander J that there is no requirement to establish exceptional circumstances. With respect, I also agree with Lander J that there is no warrant to read a requirement for exceptional circumstances into s 101(3).

   […]

   [171] By amendment in 2006, s 101(4) was added to provide that without limiting the matters that the Registrar may take into account in deciding under s 101(3) not to remove a trade mark from the Register, the Registrar may take into account whether the trade mark has been used by the registered proprietor in respect of (a) similar goods or closely related services; or (b) similar services or closely related goods. The parties disagree as to whether or not the matters now raised in s 101(4) are able to be taken into account for the purposes of the unamended section; that is, whether it was necessary to insert s 101(4) to add discretionary factors not previously available, or to clarify that they were always available to be taken into account.

   There is no limitation within s 101(3) on the discretion, nor any indication of the factors to be taken into account. In the Explanatory Memorandum to the Trade Marks Amendment Bill 2006 (Cth) by which s 101(4) was introduced, it is stated that ‘[c]urrently, it is not clear that the Registrar is able to take use on closely related goods or services into account, when deciding whether to exercise his or her discretion not to remove a trade mark from the Register’ and that the amendment was for the purposes of clarifying the Registrar’s discretion.

Evidence

Evidence in Support

• The declaration of Nicole Brook (‘Brook’) Managing Director of the Opponent, made on 25 November 2016.

Discussion

1. To defeat the non-use application, the opponent must demonstrate that it has used the Trade Mark on the goods covered by the registration within mentioned earlier, the evidentiary standard is the ‘balance of probabilities’ which means that I must be satisfied the relevant period. This arises by virtue of section 100(1)(c) of the Act. As it is more likely than not that the Trade Mark was used in the relevant period.

2. The main arguments advanced by the non-use applicant in this case are that:

• The opponent has not demonstrated use of the Trade Mark as registered for the relevant goods during the relevant time frame; and

• The use of the Trade Mark demonstrated by the opponent is outside of the relevant time frame and the most recent use is on a very limited number of goods and that no clear and enduring intention to use the Trade Mark has been established by the opponent which would be sufficient to apply the Registrar’s discretion.

1. The Brook declaration outlines that the opponent has been manufacturing and selling barbeque briquette in Australia since the 1970s and that the opponent’s Heat Beads ® brand has a significant market share within Australia for those goods. Ms Brook declares that the Trade Mark is a sub-brand of the opponent’s Heat Beads ® and that the opponent applied for the Trade Mark on 11 August 1988 which is approximately the time when the opponent commenced using the Trade Mark on its goods. Ms Brooks avers that there were substantial sales of goods bearing the Trade Mark until use of the Trade Mark was suspended in 2006 after the closure of the local factory.

2. According to Ms Brook between November 2013 and March 2016 the opponent worked towards the re-commencement of sale of goods bearing the Trade Mark including;

• Working with two different suppliers to develop the MATCHLITE line for manufacturers overseas;

• Making visits to China and Hong Kong;

• Testing the product for suitability for the Australian market;

• Reviewing quotes and market prices.

1. Ms Brook has averred that the opponent intended to relaunch the product in the summer season of 2016/2017 and that trips were made to China and Hong Kong to discuss the product and that the product was tested in its internal laboratory for suitability for the Australian market. However, there is no documentary evidence before me which supports any of these statements made by Ms Brook. Given that the onus is on the opponent to demonstrate that they have used the Trade Mark within the relevant period it appears that it would have been a simple matter for Ms Brook to provide evidentiary proof that supported the statements in her declaration.

2. Instead I am faced with unsupported assertions and exhibits containing undated pictures of a product bearing the Trade Mark that was released after the relevant period, the number of which sold was in the single digits. Therefore, I give no weight to Ms Brook’s statements regarding the intention and preparation of the opponent during the relevant period to relaunch goods bearing the Trade Mark without material in evidence to substantiate her claims.

Registrar’s Discretion

1. There is a discretion embodied in subsection 101(3) of the Act. That particular part of the legislation reads as follows:

   (3) If satisfied that it is reasonable to do so, the Registrar or the court may decide that the trade mark should not be removed from the Register even if the grounds on which the application was made have been established.

1. The application for removal is for all goods within class 4. The opponent has requested the Registrar’s discretion to allow the Trade Mark to remain registered for all those goods as the Trade Mark:

   ·   Still has residual reputation within Australia given its long history; and

   ·   The opponent has invested significantly in the relaunch of the MATCHLITE product.

2. The opponent has argued that because the Trade Mark has been registered since 1988 there is a residual reputation in the Trade Mark which the relaunch of the product has built upon, and that to remove the Trade Mark now would cause confusion in the marketplace. I am not persuaded by this reasoning.

3. The evidence before me is de minimus and the plans Ms Brook assert occurred to relaunch goods bearing the Trade Mark are not substantiated in the evidence when it appears this could have easily been done. Nor is there any evidence before me of a residual reputation in the Trade Mark which would have endured a decade of apparent non-use after the closure of the factory in 2006. Given all of the above, I am not satisfied that it is reasonable to exercise the Registrar’s discretion.

Decision

1. I find the opponent has not rebutted the allegation of non-use. I direct trade mark registration 492977 be removed from the Register in respect of all the goods to which the registration applies, one month from the date of this decision. In the event of an appeal, I direct that the Trade Mark will not be removed until the appeal has been discontinued or, in the event of a decision from the Court, that the Trade Mark be subject to that order.

Costs

1. It is usual for costs to follow the event, and I see no reason to depart from that principle here. I award costs against the opponent as allowed by Schedule 8 of the Regulations.

Bianca Irgang
Hearing Officer
Trade Marks Hearings
12 January 2018