Bentley Motors Limited. v Xianming Zeng

[2018] ATMO 168

TRADE MARKS ACT 1995

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

Re:Opposition by Bentley Motors Limited to registration of trade mark application 1772306 (33) – B (Device) - the name of Xianming Zeng

Delegate:

Nicholas Smith

Decision:

2018 ATMO 168

Trade Marks Act 1995 (Cth) - Section 52 opposition: s 62A considered – ground established – registration refused

Background

1.  This is an opposition brought by Bentley Motors Limited (‘Opponent’) pursuant to s 52 of the Trade Marks Act 1995 (Cth) (‘Act’) to the registration of the trade mark which is the subject of the application detailed below in the name of Xianming Zeng (‘Applicant’). 

Application Number:

1772306

Filing Date:

23 May 2016

Goods:

Class 33: Wine; Cider; Distilled beverages; Liqueurs; Whisky; Vodka; Brandy; Gin; Fruit extracts (alcoholic); Alcoholic beverages (except beer)

(‘Applicant’s Goods’)

Trade Mark:

(‘Trade Mark’)

2.  Following the examination process, the Trade Mark’s acceptance for possible registration was advertised on 13 October 2016 in the Australian Official Journal of Trade Marks.  The Opponent filed a Notice of Intention to Oppose on 21 November 2016.  The Opponent then filed a Statement of Grounds and Particulars (‘SGP’) on 20 December 2016. The SGP raised grounds of opposition under ss 42(b), 44, 58, 60 and 62A of the Act. The Applicant filed a Notice of Intention to Defend on 8 February 2017.

Evidence and Submissions

3.  The Opponent filed Evidence in Support of its opposition (‘EIS’) on 15 May 2017.  This evidence consists of a declaration made on 12 May 2017 by Justine Pridding, Corporate Counsel of the Opponent with annexures JP-1 to JP-24 (‘Pridding Declaration’).  No evidence in answer or evidence in reply has been filed. 

4.  Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing or to file written submissions.  By letter issuing from IP Australia on 24 October 2017 the parties were notified that as neither party had requested a hearing the matter would be given to a delegate of the Registrar for a decision based on the written record.  The letter indicated that the parties had one month from the date of the letter to file any written submissions they wished to reply upon.  On 27 November 2017 the Opponent filed submissions (‘Opponent’s Submissions’).  The Applicant did not file any submissions in this matter. 

5. I am a delegate of the Registrar of Trade Marks and I am to decide the opposition as required by s 55 of the Act which provides that, unless the proceedings are discontinued, dismissed, or have lapsed under s 54A the Registrar must, at the end, decide on the basis of the written record, comprised of the materials mentioned in the preceding paragraphs:

(a)to refuse to register the trade mark; or

(b)to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;

having regard to the extent (if any) to which any ground on which the application was opposed has been established.

The Opponent

6.  The Opponent is British luxury car manufacturer and designer that has traded under the Bentley brand since 1919. 

7.  The Opponent is the registered owner of the trade marks set out in Annex 1, each of which is substantially identical to the Trade Mark, with Trade Mark 1427478 being identical to the Trade Mark (‘Opponent’s Trade Marks’).  For the purpose of this decision I refer to the device contained in the Opponent’s Trade Marks (and the Trade Mark) as the B-Wings device.

8.  The Pridding Declaration contains the following claims/statements:

·     The Opponent has traded since 1919 and sells its cars in 58 countries around the world including Australia.  The Opponent adopted the B-Wings device in 1919 although it has slightly modified the B-Wings device over the years.

·     The B-Wings device is an original artistic work by the Opponent in which copyright subsists.  The Applicant’s adoption of the B-Wings device is a misappropriation of that copyrighted work.

·     The Opponent has traded in Australia continuously since 1956 and has used the B-Wings device in sales and advertising consistently since then.

9.  The Pridding Declaration makes a number of comments about the Applicant in respect to a claim of bad faith:

·     The Applicant is a shareholder of the entity Eastern Tomorrow (Jin Jiang) Import and Export Co Ltd (‘Eastern Tomorrow’).  Eastern Tomorrow applied to register a mark identical to the Trade Mark for essentially identical goods on 8 February 2014 (Trade Mark application 1604887) which was successfully opposed by the Opponent.

·     Eastern Tomorrow and another related entity have applied to register the B-Wings device in China, Macao and Singapore.  These applications have been opposed by the Opponent, with such oppositions either being successful or ongoing.

·     Given the circumstances, the declarant is of the opinion that the Applicant filed the registration of the Trade Mark with full knowledge of the B-Wings device and with the intention of misleading consumers as to the origin of the Applicant’s Goods.

The Applicant

1. The Applicant has provided no evidence and, therefore, I am unable to provide any information about the Applicant other than what is set out in the EIS (summarised above) and the Register. 

2. I note that Eastern Tomorrow, the company that the Opponent has asserted that the Applicant is related to, was a party to two recent decisions by the Registrar.[1] In each case the delegate found that Eastern Tomorrow acted in bad faith pursuant to s 62A of the Act by seeking to register to register a trade mark that was related to brands used by the (then) opponent.

   [1] Southcorp Brands Pty Limited v Eastern Tomorrow Jinjiang Import & Export Co Ltd [2018] ATMO 118 and SouthCorp Brands Pty Limited v Eastern tomorrow jinjiang Import and Export Co Ltd [2018] ATMO 38

Grounds of Opposition, Onus and Standard of Proof

1. As indicated above in the SGP the Opponent nominated grounds of opposition under ss 42(b), 44, 58, 60 and 62A of the Act. To successfully oppose the application the Opponent needs to establish at least one of the abovenamed grounds. As will become apparent, the Opponent has successfully established a ground of opposition pursuant to s 62A. Accordingly, I have found it necessary to discuss this ground only. Of course, should the decision be appealed, it would remain open to the Opponent to plead any ground available to it under the Act in proceedings before the Court.

2. The onus of proof in an opposition rests upon the Opponent.[2]  The relevant standard of proof is the ordinary civil standard based on the balance of probabilities.[3]  The date at which the rights of the parties are to be determined is 23 May 2016 (‘relevant date’), being the filing date of the application in Australia (except in circumstances, not present here in which a different priority date is provided for in the Act).[4]

Discussion

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

[3] Following Pfizer Products Inc v Karam (2006) 70 IPR 599, [6]-[26], and Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133].

[4] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 595, see also s 29(1) Trade Marks Act 1995 (Cth).

Section 62A

1. Section 62A of the Act is reproduced below:

   62A 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 Explanatory Memorandum to the Trade Marks Amendment Bill 2006 provided some non-exhaustive examples of applications made in bad faith:

• persons who monitor new property developments, register the names of new developments as trade marks for a number of services and then threaten the property developers with trade mark infringement proceedings unless the developers licence or buy the trade marks;

• persons who have a history of applying for trade marks that are deliberate misspellings of other registered trade marks;

• persons who identify trade marks used overseas but with no Australian use as yet who then apply to register the trade marks in Australia for the express purpose of selling them to the overseas owners.

1. The case of Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) (‘Fry’) is a leading authority on this section.  In that case, Dodds-Streeton J made the following comments, quoting from Harrison’s Trade Mark Application[5]:

   Clearly the court, when considering bad faith, cannot apply a purely subjective test, called by Lord Hutton ‘the Robin Hood test’. The dishonest person or one with low standards cannot be permitted to obtain trade mark registrations in circumstances where a person abiding by a reasonable standard would not. The registration of a trade mark is designed to enable bona fide proprietors to protect their proprietary rights without having to prove unfair trading. Registration is not provided to help those with low moral standards.

   … The words ‘bad faith’ suggest a mental state. Clearly when considering the question of whether an application to register is made in bad faith all the circumstances will be relevant. However the court must decide whether the knowledge of the applicant was such that his decision to apply for registration would be regarded as in bad faith by persons adopting proper standards.[6]

   [5] [2004] EWCA Civ 1028; (2005) FSR 10.

   [6] [2012] FCA 81, [147].

2. Her Honour continued later in the same decision:

   The formulation in United Kingdom authority of bad faith as falling short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in a particular area is, in my view, an apt touchstone. An overly literal application may, however, tend to negate the relevance attributed to the applicant’s mental state in the combined test preferred in Harrison.

   Further, in my view, mere negligence, incompetence or a lack of prudence to reasonable and experienced standards would not, in themselves, suffice, as the concept of bad faith imports conduct which, irrespective of the form it takes, is of an unscrupulous, underhand or unconscientious character.[7]

   [7] Ibid [165]-[166].

3. Her Honour also noted with approval a number of cases in which bad faith were found in specific circumstances as set out below:

   In William Leith New Century Marquees (SRISO/018/00, UK Registry), the applicant applied to register a trade mark in respect of marquees, tents and related goods, although aware that NEW CENTURY was the opponent’s trade mark in the United States of America and that the opponent had started to trade in the United Kingdom under the trade mark. He was himself a customer and the delegate found that he should have been aware that the opponent could be expected to expand that trade, if it had not already done so. He had previously proposed a licence arrangement with the opponent although its terms were not clear. The delegate of the Registrar concluded:

   Mr Leith subsequently adopted the sign NEW CENTURY MARQUEES as his own trade mark, and he used it in the UK. When he was challenged about this he sought to register the mark in combination with his own name. In my view, the mark he has applied to register is confusingly similar with the mark NEW CENTURY.

   
   

   ...

   
   

   It is difficult to see how a person who applies to register a mark in his own name which he has previously recognised as the property of a potential overseas principal can be said to be acting in accordance with acceptable standards of commercial behaviour. I do not believe that combining the mark with the applicant’s own name is any answer to that criticism.[8]

   …

   In Hard Coffee Pty Ltd v Hard Coffee Main Beach Pty Ltd [2009] ATMO 26, Hearing Officer Nancarrow held that applications to register the trade marks HARD COFFEE MAIN BEACH and HARD COFFEE were made in bad faith within the meaning of s 62A, where a company controlled by the applicant’s controller had previously obtained a licence from the opponent’s predecessor in title to use the HARD COFFEE MAIN BEACH trade mark, acknowledging in that context that it had not purchased any right, title or interest in the names and that the vendor retained title to all related intellectual property rights. The Hearing Officer considered that in the circumstances, the director clearly understood that the trade mark in question remained the property of the opponent in respect of coffee shops.[9]

   …

   In Pritchard Pacific Pty Ltd Baltimore Aircoil (Australia) Pty Ltd v Brendan McCarrison and Breezewater Pty Ltd [2011] ATMO 46, the delegate upheld opposition to the registration of a trade mark for, inter alia, cooling towers and like apparatus and related services, on grounds including bad faith under s 62A of the Act. The delegate found that the applicant’s controller had a prior business connection with and knowledge of the opponent, such that a person standing in his shoes should have known that he should not apply for the registration of a trade mark deceptively similar to that used by his former business partner (at [42]).[10]

   [8] Ibid [151].

   [9] Ibid [153].

   [10] Ibid [156].

4. The Opponent has particularised this ground of opposition in the SGP as follows:

   The Opponent has used the Opponent’s Trade Marks in Australia continuously since at least 1956 in relation to motor vehicles and chassis therefor and since at least 2009 in relation to the balance of the Opponent’s Goods and Services.

   By reason of the Opponent’s reputation in the Opponent’s Trade Mark, the Applicant should, or should reasonably, have been aware that the Opponent enjoyed such a reputation and that it owned the Opponent’s Trade Mark in Australia. The Applicant sought to take advantage of the Opponent’s reputation by filing, in bad faith (within the meaning of section 62A), an application that is substantially identical with or deceptively similar to the Opponent’s Trade Mark and either in relation to goods and services that are the same as or similar to the Opponent’s Goods and Services or alternatively in relation to goods in relation to which the Applicant has sought to indicate has some association or affiliation with, or endorsement by, the Opponent.

5. I have been provided with no explanation of the Applicant’s actions, nor is there an obvious reason for the Applicant to seek to register the Trade Mark that copies the B-Wings device.[11]  Indeed it is incredibly unlikely that an entity would independently create a device that precisely copies the B-Wings device used by the Opponent.

   [11] See the discussion on bad faith in Jackson International Trading Company Kurt D. Bruhl Gesellschaft m.b.H & Co. KG v Hugo Boss AG [1999] ATMO 23.

6. The Opponent has made the claim that the Applicant is associated with Eastern Tomorrow as a major shareholder.  Eastern Tomorrow has sought to register the B-Wings device as a trade mark, both in Australia and in various other countries.  Given the sheer unlikelihood of the alternative possibility (that the Applicant independently created the B-Wings device), on the balance of probabilities I accept the Opponent’s submissions that at the relevant date, the Applicant:

• was aware that Eastern Tomorrow had sought to register the B-Wings device as a trade mark;

• was aware of the existence of the Opponent, both because the Opponent had opposed the various prior applications and because of the reputation of the Opponent more generally; and

• was aware that the Opponent was the registered owner of various trade marks featuring the B-Wings device and held copyright in the B-Wings device, being the main basis on which the Opponent would have opposed the trade mark applications made by Eastern Tomorrow; and

• despite, or because of the above, chose to apply to register the Trade Mark.

1. The only reasonable conclusion that may be drawn from the limited evidence before me is that the Applicant sought to take advantage of the Opponent’s reputation in and use of the B-Wings device, or otherwise sought to convey to consumers that it was associated or affiliated with, or otherwise endorsed by, the Opponent, which is false. 

2. While the fact that the Applicant was aware of the Opponent’s business and its trade mark is not of itself fatal[12], the act of applying to register a trade mark in circumstances such that a person standing in the applicant’s shoes should have known that they should not apply for the registration has previously been held to support a finding that s 62A has been established.[13]  In the present case the Applicant has sought to register a trade mark that is identical to one used by the Opponent across a wide variety of goods and services and that the Opponent holds copyright in.  Furthermore the Applicant has applied to register the Trade Mark after an associated entity applied unsuccessfully to register the same mark.  I am satisfied that the Applicant’s conduct falls short of the ‘standards of acceptable commercial behaviour observed by reasonable and experienced persons’.[14] I find that the Opponent has established the ground of opposition under s 62A.

   [12] Next Group Plc v Nexcorp Australia Pty Ltd [2016] ATMO 34, [77].

   [13] Pritchard Pacific Pty Ltd Baltimore Aircoil (Australia) Pty Ltd v Brendan McCarrison and Breezewater Pty Ltd [2011] ATMO 46.

   [14] DC Comics v Cheqout Pty Ltd [2013] FCA 478, [77].

Decision

1. I have found the Opponent has established the ground of opposition it raised pursuant to s 62A of the Act. As the Delegate of the Registrar I accordingly refuse to register the Trade Mark.

Costs

1. The Opponent has sought an award of costs in its favour. I see no reason to depart from the general rule that costs follow the event. I accordingly award costs against the Applicant under section 221 of the Act in the relevant amounts under Schedule 8 of the Trade Mark Regulations 1995 (Cth).

Nicholas Smith

Hearing Officer

Oppositions and Hearings

9 October 2018

Annex 1 – List of Opponent’s Trade Marks

Number	Trade Mark	Priority Date	Services
1011717	19 Jul 2004	Class 14: Jewellery, watches and clocks Class 16: Printed matter, books, publications, texts, periodicals, magazines, brochures, pamphlets, information sheets, posters, stationery, diaries, calendars, crayons, coasters, flags, photographs, jigsaw puzzles, autograph cards, postcards, photograph and picture albums, greeting cards, decalcomanias, printed livery for application to windows and vehicles, user manuals Class 18: Leather and imitations of leather and goods made therefrom; umbrellas and parasols; bags, suitcases, holdalls, wallets, purses, luggage Class 25: Clothing, footwear, headgear Class 34: Tobacco; smoker's articles Class 36: Provision of financial services; insurance services; loan and credit services, warranty services, credit and debit card services Class 37: Repair, installation, and maintenance services all relating to automobiles, internal combustion engines and parts and fittings thereof
1427478	27 May 2011	Class 3: Perfume, cologne, aftershave, deodorants, cosmetics, hair lotions, soaps, personal hygiene products Class 21: Articles of glass, crystal, earthenware and porcelain; bottles and containers of glass; decanters; perfume bottles
1643881	28 Aug 2014	Class 3: Perfume, cologne, aftershave, deodorants, cosmetics, hair lotions, soaps, personal hygiene products Class 21: Articles of glass, crystal, earthenware; bottles and containers of glass; decanters; perfume bottles, but not including tableware and mugs, articles of porcelain (excluding bone china, tableware and mugs)
1221410	15 Apr 2014	Class 9: Optical apparatus; eyewear; glasses and sunglasses and accessories therefor; cases, wallets, carriers and holders adapted for glasses and sunglasses; leather cases, wallets, carriers and holders adapted for glasses and sunglasses; parts, fittings and accessories for all the aforesaid goods; mobile phones, mobile phone chargers; leather cases for mobile phones; cases, holders, straps, carriers for mobile phones; hands free devices for mobile phones; mobile phones for use in vehicles; accessories for mobile phones included in this class; computers; laptops; tablet computers; radios; radios for motor vehicles; cassette players; cassette players for motor vehicles; compact disc players; compact disc players for motor vehicles; mini-disc players; mini disc players for motor vehicles; MP3 players; MP3 players for motor vehicles; DVD players; DVD players for motor vehicles; wallets, cases, holders and carriers for audio cassettes, compact discs, DVDs, mini-discs; wallets, cases, holders and carriers for DVD players, MP3 players, mini-disc players, computers, laptops and tablet computers; speakers; speakers for vehicles; wireless speakers; wireless speakers for vehicles; fire extinguishers for use in motor vehicles; battery chargers; battery charging equipment; battery charging monitors; radio antennas; loudspeakers; measuring instruments; time measuring instruments; pressure gauges, tyre pressure gauges; speedometers, speedometer testers; ammeters; oil and petrol level gauges; temperature gauges; electric locks for vehicles Class 12: Apparatus for locomotion by land, rail, air or water; vehicles; motor vehicles and parts and fittings therefor; snow chains for motor vehicle wheels; tyres for motor vehicles; solid rubber tyres for motor vehicle wheels; pneumatic tyres; alloy wheels for motor vehicles; mud flaps for motor vehicles; steering wheels for motor vehicles; car safety seats for children; vanity mirrors for motor vehicles; tread plates for motor vehicles; luggage nets for motor vehicles; motor vehicle horns; vehicle anti-theft alarms and devices; surrounds for headlamps; reversing alarms for vehicles; ski carriers for use on motor vehicles; brake components for motor vehicles; gear lever knobs for motor vehicles; ventilation grilles for vehicles; wood panels for motor vehicles; covers for loudspeaker in vehicles; petrol tanks for vehicles; caps for vehicle petrol tanks; cigarette and cigar lighters for vehicles; petrol tank caps for automobiles; mirrors for vehicles, rear-view mirrors; head rests for vehicles; seat belts, safety belts; windscreen wipers, washers, blades and arms; antitheft alarms and apparatus for motor vehicles; accessories, parts and fittings for all the aforesaid goods Class 14: Precious metals and their alloys; jewellery; precious stones; watches and clocks; watch and clock cases; jewellery cases; charms; badges of precious metal; boxes of precious metal; table clocks; desk clocks; cufflinks; tie clips; tie pins; lapel pins; pins; jewellery boxes; cuff link boxes of precious metal; key rings; cases for watches; mobile phone charms Class 16: Stationery; writing implements; pens; pencils; letter openers; desktop business card holders; stands for pens and pencils; holders for pens and pencils; case for pens and pencils; desk trays; letter trays; letter racks; document folders in the form of wallets; desk pads; photograph albums; photobooks; diaries; coasters made of paper or cardboard; calendars; paper clip holders; paperweights; desk blotters; books; albums; almanacs; atlases; charts, maps; catalogues, magazines; paper weights; passport holders; money clips; money holders; pen clips; pen wipers; photographs, engravings; photograph stands; pictures, posters, prints; writing paper; printed matter, publications, texts, periodicals, brochures, pamphlets, information sheets, posters; crayons; flags of paper; autograph cards; postcards; photograph and picture albums; greeting cards; decalcomanias; printed livery for application to windows and vehicles; user manuals, instruction manuals and guides Class 18: Leather and imitations of leather and goods made therefrom; card holders [wallets]; bags; handbags; shoulder bags; sports bags; backpacks; satchels; briefcases; carrying cases; holdalls; wallets; credit card holders of leather; purses; luggage; suitcases; umbrellas and umbrella covers; parasols and parasol covers; garment bags; suit bags; jewellery rolls, wraps and pouches; vanity cases; valises; trunks; travelling bags; boxes of leather; animal hides, animal skins; walking sticks and canes; furniture coverings of leather; leather trimmings for furniture Class 25: Articles of clothing, footwear, and headgear; trousers; jeans; shorts; skirts; dresses; shirts; t-shirts; jumpers; sweatshirts; sweaters; polo shirts; cardigans; pullovers; fleeces; ties; neckties; underwear; nightwear; dressing gowns; bath robes; vests; coats; jackets; waterproof coats; waterproof jackets; scarves; gloves; shawls; swimwear; belts; caps; hats; shoes; boots; trainers; sandals Class 28: Toys, games and playthings; gymnastic and sporting articles not included in other classes; decorations for Christmas trees; skis; snowboards; ski bindings; waterskis; bags especially designed for skis and snowboards; backgammon games; toy vehicles; teddy bears; playing cards; jigsaw puzzles Class 35: Retail and wholesale services; retail and wholesale services connected with the sale of vehicles and parts and accessories therefor; retail and wholesale services connected with the sale of perfumes and cosmetics, optical apparatus, glasses, sunglasses, and accessories therefor, mobile telephones and accessories therefor, jewellery, clocks and watches, stationery goods, leather goods and imitations of leather goods, luggage, handbags, bags, cases and accessories therefor; retail and wholesale services connected with the sale of furniture and parts and accessories therefor, articles of glass, crystal, earthenware and porcelain, textiles and textile goods, articles of clothing, footwear and headgear and accessories therefor, toys, games and playthings and sporting articles; advertising; business management; business administration; office functions Class 39: Transport and delivery of goods; transportation of passengers by road, rail, water and air; provision of travel information; travel arrangement services; leasing of vehicles; booking agency services relating to travel; travel tour organising and operating services Class 41: Education; providing of training; entertainment; sporting and cultural activities; provision of education, training and entertainment services relating to automobiles and to travel; arrangement and organisation of competitions; arrangement and organisation of shows, sporting and cultural activities; arrangement and organisation of leisure activities; provision of seminars, conferences and exhibitions; entertainment and leisure booking services