Barrand Investment Pty Ltd v High Spirits Wholesale Pty Ltd as Trustee for KSB Family Trust

[2020] ATMO 55

TRADE MARKS ACT 1995

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

Re:Opposition by Barrand Investment Pty Ltd to registration of trade mark application number 1843614 (class 33) – VODKA STINGER (Figurative) - in the name of High Spirits Wholesale Pty Ltd as Trustee for KSB Family Trust.

Delegate:	Kate Doherty
Representation:	Opponent: In person Applicant: Griffith Hack
Decision:	2020 ATMO 55 Trade Marks Act 1995 (Cth) – opposition under section 52 – grounds of opposition pursued ss 58 and 62A; none established; trade mark will proceed to registration.

Background

1. This is an opposition decision following an oral hearing in Canberra on 7 February 2020. I heard the matter as Delegate of the Registrar of Trade Marks in relation to the following trade mark under the Trade Marks Act 1995 (‘the Act’):

Trade Mark No:               1843614

Trade Mark:    (‘Trade Mark’)

Words:  VODKA STINGER

Filing date:   16 May 2017

Applicant:  High Spirits Wholesale Pty Ltd as trustee for KSB Family Trust.

Specification of Goods: (at time of filing):  Class 33

1. The Trade Mark was advertised accepted on 31 May 2017. A Notice of Opposition was filed on 19 October 2017 by Barrand Investment Pty Ltd (‘The Opponent’). On 20 October 2017, the Applicant filed a Notice of Intention to Defend the Opposition. An extension of time application was granted in relation to the Notice of Opposition on 2 February 2018. The Statement of Grounds and Particulars (‘SGP’) nominates grounds of opposition under ss 58 and 62A.

Evidence

1. Summary of evidence received from the Opponent.

Declarant	Party	Evidence Stage	Date	Annexures	Decision Reference
S Barrand	Opponent	EIS	23 October 2018	SB1-SB11	Barrand Declaration
K Balfe	Applicant	EIA	11 February 2019	KB1-KB13	Balfe Declaration
P Balfe	Applicant	EIA	2 April 2019	PB1-PB2	Other Balfe Declaration
J Waples	Applicant	EIA	30 January 2019	N/a	Encore Beverages Declaration
J Bongiorno	Applicant	EIA	6 February 2019	N/a	Bongiorno Declaration
C Bleaney	Applicant	EIA	4 March 2019	N/a	Bleaney Declaration
S Barrand	Opponent	EIR	22 July 2019	N/a	Second Barrand Declaration
K Barrand	Opponent	EIR	22 July 2019	N/a	Other Barrand Declaration

The declarations annex evidence which includes copies of: product images, confidential sales figures, invoices, screenshots of websites and email correspondence.

1. The Opponent has provided evidence which includes the following unregistered trade mark:

Words:        STINGER

Image description:   (‘Opponent’s Mark’)

1. Written submissions were received from the Applicant only.  Both parties attended the hearing.

Onus and Standard of Proof

1. The relevant standard of proof is the civil standard, or “on the balance of probabilities”.[1] 

   [1] Pfizer Products Inc v Karam (2006) FCA 1663 per Gyles J at [6] to [26].

2. The Opponent bears the onus of proof in an Opposition Hearing.[2] The evidential burden is reversed once evidence is filed in support of the s 58 ground of opposition, but only for time prior to the filing date.

   [2] Food Channel Network Pty Ltd v Television Food Network GP (2010) FCAFC 58 [32].

3. The application will succeed if the nominated ground is established. The rights of the parties are determined at the date of filing the application, the relevant date is 16 May 2017. For the s 58 ground use before this date will be considered.[3]

Grounds of Opposition

[3] Trade Marks Act 1995 (Commonwealth), s7.

Section 62A – Application made in bad faith

1. Section 62A of the Act provides:

   60 Application made in bad faith

   The registration of a trade mark may be opposed on the ground that the application was made in bad faith.

2. The s 62A ground is nominated as a ground of opposition by parties to trade mark disputes reasonably frequently but the ground is rarely successfully established.[4]  The reason for this is often that only bad faith in connection with the filing of the trade mark application can be assessed.  Bad faith, fraud, misconduct or deception alleged to have occurred in relation to other business practices or agreements is not automatically relevant to an assessment pursuant to s 62A.   This ground is not a catch-all provision for any dispute which may have occurred between the parties.

   [4] Section 62A was introduced by the Trade Marks Amendment Act 2006, prior to this the Registrar was not empowered to refuse or remove marks on a ground of bad faith; see also: DC Comics v Cheqout Pty Ltd[2013] FCA 478 at [62]. 

3. Section 62A is discussed in Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) per Kenny J:3F[5]

   By September 2004, Mr Fry, a director of Fry Consulting, was well aware of Sports Warehouse’s online retail store and the fact that Sports Warehouse sold goods to Australia through that website.  His visits to that online retail store led him to cause Fry Consulting, in September 2004, to register the business name “Tennis Warehouse”; to register the domain name and to set up an online tennis retail store at that domain name in competition with Sports Warehouse.  Mr Fry adopted the name knowing that it would cause confusion between Fry Consulting’s and Sports Warehouse’s online stores.  Indeed, the potential for such confusion was why he chose the name.  Furthermore, in developing the Fry Consulting website, Mr Fry took images from the Sports Warehouse website.

   [5] [2012] FCA 81 [62].

4. Notably, the passage above relates to a matter where one party was found to be clearly using the trade mark as a trade mark prior to registration. In the evidence before me, neither party has shown use as a trade mark prior to the Filing Date.[6]   The evidence taken at its highest discloses discussions about the terms ‘Stinger’ and ‘Vodka Stinger’ as well as correspondence in relation to designing different trademarks between various parties and third parties.   The absence of use as a trade mark is not fatal to the application but introduces complexity. [7] 

   [6] Trade Marks Act 1995, s7.

   [7] Moorgate Tobacco Co. Limited v Phillip Morris Limited and Another (1984) 156 CLR 415 [23].

5. The Opponent states that they chose the name ‘Stinger’ to complement a range of vodka drinks they were already marketing called ‘Scorpion’.[8]  The Applicant has not provided a story in relation to how they decided on the term ‘Stinger’.  There is no evidence before me that the parties did not independently arrive at the respective designs for the devices which function to complement the text in their respective marks.  Trade Mark rights do not extend protection to ideas only the form of a mark.

   [8] Barrand Declaration [6].

6. A witness states that a meeting was held with the Applicant in Queensland in November 2016 in relation to production of a ‘self mixer product’ named ‘Stinger’.[9]  Another witness who attended the meeting supported this in a further declaration.[10]  These two witnesses are sales representatives employed by the Applicant.[11]

   [9] C Bleaney Declaration.

   [10] Bongiorno Declaration [1]-[2].

   [11] K Balfe Declaration [5].

7. A Director of a contract packaging company declared that they received a telephone call in December 2016 from the Applicant in relation to manufacturing ‘Vodka Stingers’.[12]

   [12] Encore Beverages Declaration (Waples).

8. The Opponent states that they contacted a designer in January 2017 to design ‘Stinger’ labels, a reply was received 12 February 2017.  The reply contains a version of the Opponent’s Mark as well as several other designs.[13]

   [13] Barrand Declaration [12]; SB3.

9. The Opponent asserts that he spoke to the Applicant on 5 January 2017 by telephone and discussed ‘Stingers’.[14]

   [14] Barrand Declaration [9], several dates of telephone calls are listed here up to and including 4 May 201.

10. A declaration by P Balfe signed 4 April 2019 confirms that a meeting with the Applicant occurred on 5 January 2017 to discuss designing packaging for a product called ‘Vodka Stinger’. [15] The document does not comment on the identical surname of the parties stating only that there was a ‘relatively informal meeting because Ken (Balfe) and I had worked together before’.[16]  P Balfe states that on 5 January 2017 he was provided with blank die-lines but in the letter annexed to his declaration there is a request to be provided die-lines on 26 April 2017. [17]   These are unsatisfactory inconsistencies and I am inclined to give that declaration negligible weight.

    [15] P Balfe Declaration [3].

    [16] P Balfe Declaration [4].

    [17] P Balfe Declaration [4], Annexure 1.

11. On 22 February 2017, an Inventory Controller from Interaust Foods emailed the Opponent enquiring about stocking the product named ‘Stingers’.[18]

    [18] Barrand Declaration, Annexure Two.

12. The Opponent held a meeting with the Applicant on 27 April 2017 to discuss ‘Stinger’.[19]  This request was after the Applicant had filed a word mark for ‘Vodka Stinger’ on 19 April 2017.

    [19] Barrand Declaration [28].

13. No fiduciary duty exists between parties negotiating licensing or distribution.[20]  Negotiation must occur at arms-length.[21]  None of the correspondence between the parties or any third party refers to the Trade Mark until 10 May 2017, just two days before the Application was filed.  The evidence cannot support a finding that the Applicant has copied the Trade Mark, it is not necessary for me to consider whether the Applicant has copied a name or branding.

    [20] Moorgate Tobacco Co. Limited v Phillip Morris Limited and Another (1984) HCA 73 [26].

    [21] Ibid [29].

14. I am not satisfied that at the date of application for the Trade Mark the Applicant’s conduct fell short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons.[22]  

    [22] DC Comics v Cheqout Pty Ltd [2013] FCA 478; 212 FCR 194 [77].

15. I find that the s 62A ground of opposition is not established.

Section 58 – Applicant not owner of trade mark

1. Section 58 of the Act provides:

   58 Applicant not owner of trade mark

   The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.

   Note: For applicant see section 6.[23]

   [23] Section 6 Definitions: applicant in relation to an application, means the person in whose name the application is for the time being proceeding.

1. An owner will not have ‘rights at large’ in the absence of Registration.[24]  Use of the mark in relation to goods or services to show a connection between the goods and the user can support ownership.[25]  For claims of proprietorship no less than substantially identical will suffice.[26]  The test for ‘substantially identical’ is well established and requires the comparison of the marks side by side:[27]

[24] Colorado Group Limited v Strandbags Group Pty Ltd [2007] FCAFC 184 [6].

[25] Ibid. [14].

[26] Carnival Cruise Lines Inc v Sitmar Cruises Ltd [1994] FCA 936 [62].

[27] The Shell Co. of Australia Ltd v Esso Standard Oil (Australia) Ltd [1963] HCA 66 [12].

The Trade Mark The Opponent’s Mark

1. The two marks both contain the word ‘Stinger’ in capital letters as a dominant feature, the placement of the word in relation to the image is different.  The Trade Mark also contains the word ‘vodka’.  The term vodka is descriptive and is in small text with double spacing between the letters which leads to that word element blending into the image.  Both marks contain pictorial representations of insects with outstretched wings, antennae, downward facing pointed tails, and large, rounded, laterally placed eyes.  One set of wings has rounded edges, the other has sharply defined edges.  I find that the overall impression of the marks is the same and the marks are therefore substantially identical.

2. The requirements of authorship do not mean the true and first inventor.[28]  An Applicant may be the ‘author’ despite merely copying a mark in circumstances where the mark has not been used at all in Australia.[29]  Prior use need not be sufficient to establish local reputation but can be slight where registration is being sought.[30] 

   [28] Aston v Harlee Manufacturing Co [1960] HCA 47 [19].

   [29] Ibid. [20].

   [30] Ibid. 11. [21].

3. On the facts neither mark was used as a trade mark but it is not necessary that there is actual dealing in the goods to establish local use.[31]  The chronology relating to the development and registration of the marks is detailed above at paragraphs [14] to [21].  Preparatory steps can be accepted as sufficient use, but the evidence before me does not describe use of the Trade Mark or the Opponent’s Mark.  Much of the correspondence and many of the asserted conversations relate only to the terms ‘Stinger’ or ‘Vodka Stinger’, or concepts such as ‘Stinger products’ or the ‘Stinger brand’.

   [31] Moorgate Tobacco Co. Limited v Phillip Morris Limited and Another (1984) 156 CLR 415 [23].

4. I do not find that these terms alone are substantially identical to the Trade Mark or the Opponent’s Mark.  While it is possible for a device to be discounted when considering whether marks are substantially identical, this is not the case here. The devices are features which distinguish the goods rather than merely illustrate the words. Despite the similarities between the Trade Mark and the Opponent’s Mark the word ‘Stinger’ could be illustrated a number of ways, for example with a jellyfish, therefore the use of an insect is not the only intuitive option for a device and is capable of being distinguishing.[32]  The evidence relating purely to the terms ‘Stinger’ and ‘Vodka Stinger’ is not relevant to the assessment of ownership of the Trade Mark. 

   [32] E & J Gallo Winery v Lion Nathan (Aust) Pty Ltd [2010] HCA 15 [69].

5. No assertion has been made that any of the steps, preparatory or otherwise, involved the Trade Mark until 10 May 2017.[33]  The Opponent’s Mark is first shown in evidence on 12 February 2017 which is before the priority date.  That use involves a small number of emails to a single designer, three different designs are shown in those emails.  I do not find that these emails containing multiple marks published to a sole graphic designer reach the threshold for the slight reputation required to establish proprietorship.[34]

   [33] Balfe Declaration [14]; Barrand Declaration [27], Annexures 4 and 5.

   [34] Second Barrand Declaration, Annexure 3.

6. I find that the s 58 ground of opposition has not been established.

Decision

1. The Opponent has not established a ground of opposition.  Pursuant to section 55(1), the Trade Mark number 1858413 will proceed to registration. 

2. The parties may appeal this decision to the Federal Court in accordance with s 56 of the Act. If the Registrar has been served with notice of appeal, I direct that the Trade Mark shall not be removed from the Register until the appeal has been decided or discontinued.

Costs

1. Costs ordinarily follow the event for an Opposition Hearing.  No submissions have been received to displace the proposition.

2. I therefore direct costs against the Opponent pursuant to s 221 of the Act in the relevant amounts prescribed by Schedule 8 of the Trade Mark Regulations 1995 (Cth).

Kate Doherty
Hearing Officer
Oppositions and Hearings
Trade Marks and Designs
15 April 2020