Beyond Properties Pty Ltd v Andrew Knight
[2006] ATMO 87
•21 November 2006
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re: Application 1001523 MYTHBUSTERS in the name of Andrew Knight and opposition thereto by Beyond Properties Pty Ltd and proposed suspension from opposition.
Date of Decision: 21 November 2006 Delegate: Iain Thompson Representation: Andrew Knight
Sue Chrysanthou of Counsel
Beyond Properties Pty Ltd
Sophie Goddard of CounselDecision: Reg 5.16 – direction that opposition proceedings be suspended. Background
Andrew Knight (‘Knight’) has applied to register the trade mark MYTHBUSTERS and, on 16 September 2004, this application was accepted for possible registration. On 7 December 2004, registration of the trade mark was opposed by Beyond Properties Pty Ltd (‘Beyond’). The grounds on which the registration is opposed are :
· The opposed trade mark is not capable of distinguishing the goods and/or services for which registration is sought from the goods or services of other persons.
· The use of the opposed trade mark would be contrary to law.
· The use of the opposed trade mark would be likely to deceive or cause confusion.
· The opposed trade mark is substantially identical with, or deceptively similar to, one or more trade marks whose registration in respect of similar goods or closely related services is being sought by the opponent and for which the priority date is earlier than that of the opposed trade mark.
· The applicant is not the owner of the opposed trade mark.
· The applicant does not intend to use or authorise use of the trade mark in Australia or to assign the trade mark to a body corporate for use by the body corporate in Australia in relation to the goods and/or services for which registration is sought
· The Registrar accepted the application for the opposed trade mark on evidence or representations that were false in material particulars
· Other grounds in the exercise of the Registrar’s discretion.
The parties are also engaged in an action in the Federal Court (NSD131/2005 ANDREW KNIGHT v BEYOND PROPERTIES PTY LTD & ORS) which has been heard before Justice Buchanan in the New South Wales Registry.
Beyond has filed application seeking that the proceedings before the Registrar of Trade marks be suspended from the opposition process until Justice Buchanan has made a decision in the matter before the Federal Court. Knight has opposed this application.
I heard submissions from the parties at a hearing in Sydney on 16 October 2006. Sophie Goddard of Counsel represented Beyond. Sue Chrysanthou of Counsel represented Knight.
Submissions
Ms Chrysanthou’s submissions were that these are opposition proceedings in respect of an accepted application and that:
It is only the opponent's opposition that stands in the way of the applicant's prima facie right to have his application proceed to registration and thus his consequent ability to exercise the rights arising from the registration.
It is incumbent on the opponent to prosecute its opposition in a timely fashion; otherwise the opposition will only serve to delay, unjustly, the proper exercise by the applicant of the rights that arise from registration. Where the opponent is (as here) a person whose present conduct would, if the trade mark was registered, infringe the applicant's rights as registered owner, then that person's failure to prosecute the opposition in a timely fashion will be an abuse of the opposition process, thereby impeding the applicant from the proper exercise of his legitimate trade mark rights. It is respectfully submitted that the Registrar should not lend aid to that abuse.
The opponent should be required to prosecute its opposition diligently. There can be no hardship to the opponent in requiring it to do so. On the other hand, unwarranted delay in the opposition process can result in irremediable damage to an applicant, particularly where, as here, the opponent's conduct causes dilution of the trade mark (and thus a diminished value of the trade mark) in the hands of its true owner.
It should be noted that the applicant filed his evidence on 29 November 2004 within the initial 3 month period. Since that time the opponent has sought numerous extensions, all of which, to date, have been granted. The opponent's application for a suspension of the opposition decision is the last in a long line of applications made by the opponent.
The opponent has already succeeded, via this application, to delay the hearing of the opposition proceedings. The closing date for the filing of further evidence by the opponent was 2 August 2006. The hearing and subsequent judgment of this application for suspension has delayed the determination of the opposition proceedings by some months.
A Trade Marks Office Hearing Officer, Ms. Dunn has held that the claims of misleading and deceptive conduct and passing off are not directly covered by the opponent's claims under sections 42 or 60 of the Trade Marks Act 1995. The applicant refers to Ms. Dunn's letter of 29 June 2006 in which she states that she does not intend to make a direction suspending the opposition proceedings on the basis that Ms. Dunn is not "convinced that the opponent's claims of misleading and deceptive conduct and passing off are directly covered by the opponent's claims under sections 42 or even 60 of the Trade Marks Act 1995. And even if 1 am wrong in this belief, 1 see no reason why the Registrar's decision should be delayed simply because it may be appealed by either party. "
The hearing date of the Court proceedings and the likelihood of it being heard (and even determined) prior to the opposition proceeding should not be a reason for delay. Ms. Dunn asserts this in her letter of 29 June 2006 in which she states:
"I note the imminent hearing date for the Court proceedings and I agree with the opponent that the Court matter may well be heard before a hearing is set down in the Trade Marks and Designs Office. However, I do not see this as a reason for delay. "
... "Whilst I note the dates for evidence and the hearing of the matter in the Federal Court, and it is unlikely that the matter will be set down for hearing at the Trade Marks and Designs Office until some time after the hearing has occurred in the Court, 1 do not accept this as a reason for further delay to the finalisation of the matter before the Registrar. "
It is the applicant's submission that this issue was properly determined by Ms Dunn in June 2006.
This application is baseless, both as a matter of principle and as a matter of fact.
The current Federal Court proceedings between the parties do not concern the registrability of the opposed trade mark. In the past the opponent's solicitors have made it quite clear that the opposition proceedings are separate from the Federal Court proceedings (which deal with passing-off and contravention of the Trade Practices Act 1974): see the letter dated 14 March 2005 from the opponent's attorneys to Kelly & Co, a copy of which is annexed to Mr Knight's declaration dated 15 June 2006 and marked "AK-2":
"We note that your client has initiated separate Federal Court Proceedings but those proceedings are nevertheless quite separate to our client's opposition to application 1001523 and the timetable within which to finalise that opposition. "
Equally telling is the fact that, at no stage, has the opponent sought to draw any connection between evidence in the Federal Court proceedings and possible evidence in the opposition proceedings until the day before the expiration of the extended period within which it was to file its evidence-in-reply. It has known about the Federal Court proceedings since January 2005 yet has waited nearly one and one half years to bring an application to suspend the opposition decision. Its delay in this regard remains unexplained.
It is clear that the opponent has simply sought to contrive a connection between the Federal Court proceedings and the opposition proceedings (which it has hitherto regarded as "quite separate") in an attempt to construct an argument to further delay the prosecution of the opposition.
Further, the opponent's argument that there will be more comprehensive evidence in the Federal Court proceedings and that the Registrar will have the benefit of the Court's determination is completely misconceived. As stated above, the registrability of the opposed mark is not before the Federal Court. It simply has no present jurisdiction in relation to that matter.
Moreover, it is clear beyond reasonable argument that the Registrar has a distinct and primary role to play in the determination of the opposition: see Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (1999) 44 IPR 551 at [63]-[65]. It follows that the Registrar is required, unless the statutory scheme is to be subverted, to arrive at an independent assessment of the registrability of the opposed trade mark based on the evidence before the Registrar. As already noted above, the factual foundation for the opponent's opposition is to be found in the evidence lodged in support of that opposition. Whilst the opponent is afforded the opportunity to reply to the applicant's evidence-in-answer, this does not mark out an occasion for the opponent to re-invent the factual basis for its opposition. Any finding by the Federal Court in relation to proceedings which are entirely separate from the opposition proceedings and based on evidence to be heard in those proceedings is completely irrelevant to the task which the Registrar faces in the opposition proceedings.
It is submitted that the connection between the opposition proceedings and the Federal Court proceedings - for which the opponent now contends - is entirely fallacious and should be rejected. The evidentiary issues are not the same and the Registrar must proceed independently, based on the particular issues and evidence before the Registrar
The applicant is presently suffering significant prejudice by the delay which is apparently being engineered by the opponent, for the reasons canvassed above. It is respectfully submitted that the Registrar should not tolerate further delay; to do so would work a great injustice to the trade mark applicant.
Ms Goddard’ submissions for Beyond are that:
It is relevant to consider the timetable of the Federal Court proceedings. On 25 September 2006, the hearing of the Federal Court proceedings commenced before Buchanan J. The hearing of all of the evidence (including cross¬examination of witnesses including extensive cross-examination of Mr Knight) continued over 5 hearing days and was completed on 29 September 2006.
A full transcript of the evidence was taken. Two further hearing days have been allocated for 9 and 10 November 2006, to enable the parties to speak to written submissions, after which his Honour has indicated he will make every effort to deliver a speedy decision (if possible before the end of term).
The Opponent submits that the central issues raised in the Opposition are issues which have been pleaded by the Applicant, Mr Knight, in the Federal Court proceedings, issues which will be determined by the trial judge, Buchanan J on the basis of the evidence (including the cross-examination, in particular of Mr Knight).
By his trade mark application made on 12 May 2004, the applicant sought registration of the mark MYTHBUSTERS in classes 16 (including printed matter) and 41 (including in respect of "education and entertainment services to include television ... ").
The Application was accepted on 27 August 2004 and opposition lodged on 7 December 2004. The Federal Court proceedings were commenced on 25 January 2006.
A central issue in the Opposition is that the Opponent contends that Mr Knight is not the owner of the MYTHBUSTERS mark in Australia, pursuant to s. 58 of the Trade Marks Act 1995, in either class for which he has sought registration.
The Opponent asserts that Beyond was the first to use the MYTHBUSTERS mark in Australia, relevantly in respect of television services in class 41, it having entered a commercial agreement with a broadcaster (Discovery) to finance the making of the MYTHBUSTERS television programme in about October 2001. Further, Beyond's MYTH BUSTERS television programme was first broadcast in the USA in January 2003 and in Australia in October 2004.
There is a real issue in the Opposition as to the use, including the alleged continued use by Mr Knight of his mark in Australia.
Importantly, the use by Mr Knight is also a central issue to be determined in the Federal Court proceedings.
The Opponent relies on paragraph 6 of the Applicant's Statement of Claim (FASOC) in the Federal Court proceedings; which is annexure MHP-B to Pollock, as follows:
"6. Since 1988 the Applicant has continuously carried on, in Australia and internationally, the business of, inter alia, developing, writing, producing and selling television programmes, and writing novels which concern the investigation of myths, under or by reference to the name and mark 'MYTHBUSTERS' (Applicant's Goods and Services)".
The above contention relevantly, forms the basis of Mr Knight's pleading, in FASOC paragraph 7 that he had "acquired a valuable and substantial reputation, in Australia and elsewhere, in the name and mark MYTHBUSTERS".
This pleading is the foundation for Mr Knight's assertion in the Federal Court, that Beyond's conduct in adopting the name MYTHBUSTERS for its television programme, constituted contravention of s. 52 of the Trade Practices Act 1974 and passing off.
As noted, an essential foundation of the Federal Court claim (and the Evidence in Answer in the Opposition) is the nature of Mr Knight's evidence relied on by him to support his contention about his use of the MYTH BUSTERS mark. In this respect, much of the evidence relied on by Mr Knight in the Federal Court proceedings corresponded precisely with Mr Knights' evidence-in-answer in the Opposition.
The table in Schedule A to these submissions is a.comparison of Mr Knight's Statutory Declaration served in answer to the Opposition (declared on 25 November 2005) with corresponding paragraphs of Mr Knight's affidavit in chief in the Federal Court proceeding sworn 21 February 2006:
As submitted Mr Knight was extensively cross-examined in the Federal Court proceedings concerning his alleged use, including as to credit, upon which the Federal Court will be asked to make findings.
In addition, the Applicant has served statutory declarations from each of the following people, each of whom swore affidavits in the same or similar form in the Federal Court:
Declarant/Deponent Stat Dec
declaredAffidavit sworn/affirmed James Daniell Adolph 23.11.2005 17.2. 2006 Darren James Black 22.11.2005 22.11. 2005 Tamara Burnstock 10.11. 2005 10.02. 2006 David John Cowperthwaite 25.11. 2005 25.11. 2005 David John Day 26.11. 2005 26.11. 2005 Robert Ralph Williams 22.11. 2005 22.11. 2005
Each of the above declarants, with the exception of Ms Burnstock, was cross-examined on their evidence in the Federal Court. That transcript is also available.
Further, there is an issue in the Federal Court proceedings as to whether the MYTHBUSTERS mark is descriptive and thus capable of acquiring a secondary meaning of the type discussed by the High Court in Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216, at 229 per Stephen J.
This is also an issue in the present Opposition, in terms of the extent to which the Applicant's mark is capable of distinguishing the goods or services of the Applicant.
Much of the Opponent's evidence in the Opposition has also largely mirrored evidence in the Federal Court. This includes the evidence of Mr Luscombe, Mr Rees, Mr Borglund, Ms Telfer, Mr Brown and Mr Herbert going to the entire history of Beyond's use of the MYTH BUSTERS mark in Australia and overseas.
Mr Luscombe, Mr Borglund, Ms Telfer and Mr Herbert were cross-examined in the Federal Court proceedings.
In summary, the hearing of the Federal Court proceedings has required the Federal Court to hear and determine evidence going to the entire trading history of each of the trade mark applicant and the opponent in relation to the MYTHBUSTERS mark.
In addition to the present application and the Federal Court proceedings, Beyond Ltd has also applied to register the MYTHBUSTERS trade mark in Australia. While this is not a matter presently before the Trade Marks Office, the findings of the Court in the Federal Court proceedings may bear upon the registrability of the Beyond application.
It is not in dispute that the Registrar has power to suspend the Opposition proceedings, by reason of s. 54 of the Act and more particularly Regulation 5.16 of the Trade Mark Regulations, which allows the Registrar broad power to conduct opposition proceedings generally, including by giving a direction to suspend the Opposition, pending the outcome of Federal Court proceedings. The question of what is the appropriate date to hear the Opposition is at the discretion of the Registrar.
This was the approach adopted in Ayrton Senna Promocones et Emprendimentos Ltda v Senna Racing Team Pty Ltd (1998) 41 IPR 395 where service of evidence in support of an opposition was suspended pending the outcome of Federal Court proceedings, in circumstances where the Court proceedings had a direct bearing on the validity of the trade marks for registration, (citing Ferocem v High Tech Auto Tools (1993) 29 IPR 144 at 148¬9).
In the Ayrton Senna case the outcome of the Federal Court proceedings was held to have direct relevance to the opposition which included the s. 42(b) ground - namely, by reason of the opponent's reputation in the mark, the use of the mark by the Applicant would be contrary to law, under s. 42(b) of the Act and thus not registrable.
The Opponent submits that the outcome of the Federal Court proceedings in the present case has a far greater relevance given that the Court will determine issues which are cardinal steps towards the determination of the question of proprietorship. The outcome of the Federal Court proceedings will determine the factual landscape of the alleged use of the MYTH BUSTERS mark by each of the Applicant and the Opponent.
In this respect, the present case is comparable to Outrigger Hotels Hawaii v Evangelista Pty Ltd (2000) 49 IPR 164.
Accordingly the essential criteria necessary to determine whether or not to suspend the Opposition where there are related Court proceedings will be that the Court proceedings have a direct bearing on the matters to be determined in the Opposition proceedings.
In addition to the above cases, the Opponent relies on Waltzing Matilda Centre Ltd v Jolly Swagman Pty Ltd (2001) 54 IPR 73, also a case where ownership was to be determined in the Court and the office and the Opposition had been set down for hearing. The Delegate held in agreeing to suspend the opposition that the court was "unquestionably the appropriate place" for ownership issues to be dealt with.
Other factors include the public interest, in:
(a) avoiding the implicitly of proceedings,
(b) the desirability of avoiding unnecessary labour and expense for the Office in analysing all of the material which is the same in the related Court proceedings
(c) the desirability of the Office having before it all of the available material to decide the Opposition. Where declarants have been cross-examined on the same evidence in a related Court proceedings and where findings will be made, the Office should have the benefits of that material and/or the findings
(d) the desirability of issues of fact being decided by a Court upon cross-examination before they are determined by the Office, which does not have the benefit of testing any of the material before it
(e) the desirability of the removal of risk of subsequent inconsistent findings
(f) the desirability of minimising the cost of expense of a proliferation of hearings;
(g) the desirability of minimising the duration of the hearing of the Opposition.
There is also the question of the relative inconvenience to the parties.
The Opponents submits that given the likelihood of an expedited decision in the Federal Court (possibly by the end of the year) there is little if any inconvenience to the Applicant, particular where the Federal Court proceedings will clarify the question of the ownership of the MYTHBUSTERS mark.
Reasons
Section 54 of the Act provides:
54 Opposition proceedings
(1) The Registrar must give to the opponent and to the applicant an opportunity of being heard on the opposition.
Note:For opponent and applicant see section 6.
(2)Subject to subsection (1), the proceedings for dealing with the opposition must be in accordance with the regulations.
Regulation 5.16 provides:
5.16 Conduct of opposition proceedings generally
(1)The Registrar may, at the request of a party to the opposition proceedings or on the initiative of the Registrar, give a direction in relation to the procedure in the proceedings.
(2)A direction given under subregulation (1) must not be inconsistent with these regulations.
(3)The Registrar must not give a direction unless the Registrar:
(a)is reasonably satisfied that parties to the proceedings have been notified of the proposed direction; and
(b)has given the parties a reasonable opportunity to make representations concerning the proposed direction; and
(c)is reasonably satisfied that the proposed direction is appropriate.
(4)For the purposes of paragraph (3) (b), the representations may be made in writing or at a hearing or by such other means as the Registrar reasonably allows.
And regulation 21.15 provides:
21.15 Hearings by Registrar
(1)This regulation applies if the Act or these regulations provide for a person to be heard by the Registrar.
(2)A request for a hearing by the Registrar must be in an approved form.
(3)On request, or on his or her own initiative, the Registrar may:
(a)fix a time, date and place for the hearing; and
(b)give the parties to the hearing at least 10 days’ notice in writing of the hearing and of the time, date and place fixed for the hearing.
(4)A party must, as soon as practicable after being notified of a hearing, inform the Registrar in writing whether the party wants to be heard.
(5)A party may attend a hearing in person or by such means as the Registrar reasonably allows.
(6)A party may make representations in writing before or during a hearing.
(7)A hearing must be conducted with as little formality and technicality, and with as much expedition, as the requirements of the Act and these regulations and a proper consideration of the matters before the Registrar, allow.
(8)The Registrar is not bound by the rules of evidence but may inform himself or herself on any matter that is before him or her in any way that the Registrar reasonably believes to be appropriate.
(9)The Registrar may adjourn a hearing by notifying each party to the hearing accordingly.
(10)Subject to these regulations, the Registrar may give a direction that is reasonably necessary for the conduct of the hearing.
As noted in the case-law referred to by Beyond, the statutory provisions applicable to this matter involve a balancing of the interests of the parties and the public interests.
I think that Knight obviously places great emphasis on perceptions of rights which might flow from the registration of the opposed trade mark if it is registered. However, the converse side of that argument is that any decision of the Registrar is capable of appeal – a decision of the Registrar that an opposition has not been established is not a decision to register the trade mark – it is a decision that the opposition has not been established and that the trade mark may proceed to registration if there is no appeal. Registration might thus soon flow from the dismissal of opposition proceedings only if the decision of the Registrar is not appealed. In other words, the rights that Knight looks forward to will not immediately arise if the decision of the Registrar is appealed and, certainty of rights and swiftness of process might ultimately benefit from a temporary delay which adds certainty to proceedings before the Registrar.
Additionally, the line of argument that suspension merely delays registration almost necessitates an assumption on my part that the opposition to registration will not be established – Knight is apparently confident of this, but I have no opinion one way or the other, for obvious reasons. Further, Beyond also has a pending application (1025338) from which rights might flow and it might be fairly observed that, in this regard, the potential or imperative of either of the parties in securing valid rights which flow from a trade mark registration effectively counterbalance each other.
And, while there is a presumption of registrability within section 33 of the Act, this applies with equal force to the Beyond application.
Further, while Hearing Officer Ms Dunn has expressed an opinion in this matter, it would be to stray into error if I were to accord this opinion any great weight. I am to consider this matter afresh, as to be bound by Ms Dunn’s opinion would render the hearing of this matter worthless and deny me the freedom to decide this matter on its own merits. Thus, while I respect Ms Dunn’s opinion, I weight it accordingly.
Beyond states that evidence and argument before the Federal Court go to both section 42 and 58 in the grounds of opposition nominated in the Notice of Opposition. Beyond also states that evidence taken from witnesses in the Federal Court will go to both section 42 and 58 of the grounds of opposition. Knight’s argument is that it will not. However, Knight might be said, as plaintiff in the Federal Court proceedings, to best know his arguments there. But Beyond, as the opponent in these proceedings, may be best placed to know the evidence before the Federal Court and filed in relation to these proceedings which goes to support its argument in proceedings before the Registrar.
Following the decision of Madgwick J in Advantage Rent-a-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683, the Registrar is obliged, when assessing whether use of a trade mark would be contrary to law under subparagraph 42(b), to take into account the operation of legislation other than the Trade Marks Act 1995. Effectively, this appears to dictate that most of the findings of the Federal Court may be relevant to whatever argument Beyond or Knight put to the Registrar in terms of section 42 of the Act. That is not to say the Federal Court will effectively decide the matter before the Registrar, it is to say that the two sets of proceedings have evidence in common and that where the Federal Court has made findings of fact and law on evidence before it which is related to proceedings before the Registrar, it is most unlikely that the Registrar would depart from those findings.
I understand that some the arguments before the Federal Court relate to the first use and reputation of the trade mark MYTHBUSTERS in relation to specific goods and services in Australia. From my limited understanding of the matter, it is possible that dealings between the parties, or entities associated with the parties, may also be at issue. Thus, while the Court will not be making a ruling on the registrability of the trade mark per se, it will be likely to include in its decision findings of fact and law which directly relate to these proceedings in terms of both section 58 and 42 of the Act.
Knight has not established that he will incur any particular damage or disadvantage apart from his perceptions related to delay in acquiring the rights and equities which would flow from a registration of his trade mark. However, as I have discussed, these considerations might equally be held to apply to Beyond because of its own pending trade mark application.
In my consideration, the balance here quite clearly swings in favour of suspending the opposition process until the Federal Court has issued its decision in proceedings before it.
What was not canvassed at the hearing of the suspension before me was what should occur if the decision from the Federal Court is appealed.
Decision
I therefore direct that the opposition proceedings in this matter be suspended until the Federal Court decision is handed down and that, if there is no appeal from that decision, this matter be lifted from suspension and the matter by decided as soon as is practical for the parties and the Registrar, in accordance with normal practice and procedure. If appeal against the Federal Court decision is filed, this issue of the suspension should be reviewed and written submission sought from the parties.
Costs
Beyond has sought its costs in this matter should it be successful. I order costs against Knight at the official scale.
Iain Thompson
Hearing Officer
Trade Marks & Designs Hearings
21 November 2006
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