Brightflash USA LLC

[2020] ATMO 22

TRADE MARKS ACT 1995

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

ReTrade Mark Application number 1886228 (9) – IWATCH - in the name of Brightflash USA LLC

Delegate:

Nicholas Smith

Representation:

Applicant: Brian Elkington of Adams Pluck

Decision:

2020 ATMO 22

Trade Marks Act 1995 (Cth) – Request to be heard under section 33(4) of the Trade Marks Act 1995 - s 41 considered – trade mark accepted for registration in Australia.

Background

1. On 9 November 2017, Brightflash USA LLC (‘Applicant’) lodged a divisional application to register the trade mark detailed below under the Trade Marks Act 1995 (‘Act’).

Application Number:	1886228
Filing Date:	9 November 2017
Priority Date:	5 June 2013 (the parent being 1722783)
Goods:	Class 9: global positioning system devices; accessories, parts, components, and cases for all of the foregoing goods; none of the aforementioned being credit card embossing machines (computer peripherals) (‘Applicant’s Goods’)
2.        Trade Mark:	IWATCH	3.        (‘Trade Mark’)

2.    On 24 January 2020 the Applicant filed a divisional application from the present application (Trade Mark Application No. 2064711).  Prior to that application the Trade Mark was also sought to be registered for Computer software; computers; computer hardware; computer peripherals; wireless communication devices (‘Identified Goods’)

1. The application was examined as required under s 31 of the Act. On 15 December 2019 IP Australia issued an adverse examination report, identifying grounds for rejection pursuant to ss 41 and 44 of the Act. The s 44 ground has been resolved through amendment but with respect to the s 41 ground the examiner stated in connection with the Identified Goods only that the Trade Mark has as its main feature IWATCH which ‘indicates the nature of your goods in class 9 and that they are in the form of, or are intended to be used with, intelligent watches, that is IWATCHes’. Other traders should be able to use IWATCH in connection with goods and services similar to the [Identified] Goods.

2. On 12 September 2019 the Applicant provided a response to the examination report containing submissions in respect of the s 41 ground of opposition. The submissions did not persuade the examiner, who issued a further report on 30 September 2019 noting that as IWATCH refers to a watch with intelligent features or function and that intelligent watches are basically computers worn in the form of a wristwatch then the Trade Mark describes the Identified Goods.

3. On 12 December 2019, the Applicant requested to be heard by the Registrar of Trade Marks under s 33 of the Act. Following the filing of the divisional application referred to above and on request of the Applicant the hearing listed on 4 February 2020 was cancelled and Brian Elkington of Adams Pluck, representing the Applicant provided me with an outline of written submissions (‘Applicant’s Submissions’) in accordance with the pre-hearing directions I had given. 

   Legislative framework

4. Under s 33(1)(b) of the Act, the Registrar must accept the application for registration of a trade mark unless satisfied there exists a ground under the Act for rejecting it. Section 17 of the Act defines a trade mark as:

   What is a trade mark?

   A trade mark is a sign used, or intended to be used, to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person.

5. The Registrar must be satisfied on the balance of probabilities that a ground for rejection exists, otherwise an application will be presumed registrable.[1] Regarding the present application, the remaining only ground for rejection identified is under s 41 of the Act.

   [1] Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891, [16].

6. Section 41 of the Act provides:

   41 – Trade Mark not distinguishing applicant’s goods or services

   (1)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 (the 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.

   (2)A trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons only if either subsection (3) or (4) applies to the trade mark.

   (3)This subsection applies to a trade mark if:

   (a)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; and

   (b)the applicant has not used the trade mark before the filing date in respect of the application to such an extent that the trade mark does in fact distinguish the designated goods or services as being those of the applicant.

   (4)This subsection applies to a trade mark if:

   (a)the trade mark is, to some extent, but not sufficiently, inherently adapted to distinguish the designated goods or services from the goods or services of other persons; and

   (b)the trade mark does not and will not distinguish the designated goods or services as being those of the applicant having regard to the combined effect of the following:

   (i)the extent to which the trade mark is inherently adapted to distinguish the goods or services from the goods or services of other persons;

   (ii)the use, or intended use, of the trade mark by the applicant;

   (iii)any other circumstances.

   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: For goods of a person and services of a person see section 6.

   Note 3: 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 (5) and 7(3) and section 8).

   (5)For the purposes of this section, the use of a trade mark by a predecessor in title of an applicant for the registration of the trade mark is taken to be a use of the trade mark by the applicant.

   Note 1: For applicant and predecessor in title see section 6.

   Note 2: If a predecessor in title had authorised another person to use the trade mark, any authorised use of the trade mark by the other person is taken to be a use of the trade mark by the predecessor in title (see subsection 7(3) and section 8).

7. With respect to s 41 it is appropriate to discuss the ‘presumption of registrability’. As was explained by the Hearing Officer in Unilever plc v Beiersdorf AG with respect to s 33 of the Act:

   Section 33 of the Act states that the Registrar must accept an application unless satisfied that it has not been made in accordance with the Act, (which is not relevant here), or that there are grounds under the Act for rejecting it. In this regard s 33 embodies what is often referred to as a ‘presumption of registrability.’ As was explained in Blount Inc v Registrar of Trade Marks[2] (‘Oregon’), however, prior to the [Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (“the Amending Act”)] ss 41(5) and (6) as they then were, (which essentially correspond to current ss 41(4) and (3) respectively), effectively shifted the onus onto an applicant. Section 41 was thus amended to address that inconsistency, with the Explanatory Memorandum to the Intellectual Property Laws Amendment (Raising the Bar) Bill 2011 (‘the EM’) stating at page 146:

   [2] (1998) 40 IPR 498, 505.

   The changes are intended to clarify that the presumption of registrability, as provided for in section 33, does apply to section 41. … The intention is that, if the Registrar is equally unsure of whether the mark is or is not capable of distinguishing, that doubt should be resolved in the applicant’s favour.

   The Amending Act was not however intended to alter the relevant standard for registrability. In this regard the EM goes on to state (also at page 146):

   Note that while the amendment [to s 41] ensures that the onus rests with the Registrar during examination, it is not intended to require that the trade mark should clearly not be registered. Rather, as with other grounds it is intended that the delegate need only be satisfied that a ground exists on the balance of probabilities.

   The amendments are not meant to alter the key concepts of “inherently adapted to distinguish”, “capable of distinguishing” and “does or will distinguish”.  The judicial tests for these terms are settled and the amendments are not intended to change the legal concept of a trade mark distinguishing the applicant’s goods or services from others.

   Branson J’s analysis at 504 in Oregon of the operation of s 41 as it stood prior to the Amending Act, as paraphrased below, also remains apt in relation to the amended section:

   Having taken [the extent of inherent adaptation] into account, it is theoretically open to [me] to conclude:

   (a) that the [Trade Mark] is inherently adapted to distinguish the [Applicant’s Services] from the goods or services of other persons and capable, on that basis alone, of so distinguishing the [Applicant’s Services]; [that is, neither s 41(3) nor s 41(4) applies] or

   (b) that the [Trade Mark] is not to any extent inherently adapted to distinguish the [Applicant’s Services] from the goods or services of other persons; [that is, s 41(3) applies] or

   (c) that the [Trade Mark] is to some extent inherently adapted to distinguish the [Claimed Goods] from the goods or services of other persons, but there is uncertainty, on that basis alone, that the trade mark is actually capable of so distinguishing the [Applicant’s Services]. [that is, s 41(4) applies][3]

   [3] [2017] ATMO 25, [38]-[40].

8. In the present case the Applicant has provided no evidence of use of the Trade Mark. As such the ground for rejection under s 41 will apply if the Trade Mark is to some extent, but not sufficiently, inherently adapted to distinguish the Applicant’s Goods from the goods of other persons, being the test in s 41(4). It is not necessary to conclude that the Trade Mark is not to any extent inherently adapted to distinguish, being the test in s 41(3).

9. In Accor Australia & New Zealand Hospitality Pty Ltd v Liv Pty Ltd, the Full Court summarised the principles in respect of s 41 as follows:

   (1) In deciding whether or not a trade mark is capable of distinguishing the designated services from the service of others, the first question is the extent to which the trade mark is inherently adapted to distinguish the designated services from those of others: s 41(2) and (3).

   
   
   

   (2) In determining whether a trade mark is inherently adapted to distinguish the services of a trader, the answer largely depends upon whether other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connection with their goods: Clark Equipment Co v Registrar of Trade Marks (“Clark Equipment”) [1964] HCA 55; (1964) 111 CLR 511 per Kitto J at 514.

   
   
   

   (3) The question of whether a trade mark is adapted to distinguish the services of the applicant is to 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 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 the words ordinarily possess) will think of the word and want to use it in connection with similar goods in any manner which would infringe the trade mark once registered: Clark Equipment at 514.

   
   
   

   (4) Directly descriptive words, like geographical names, are not prima facie suitable for the grant of a monopoly conferred by registration of a trade mark because use of them, as trade marks, will “rarely eclipse” their “primary” (that is, their ordinary) signification. Such words (or a word) are unlikely to be inherently, that is to say, “in [their] own nature”, adapted to distinguish the applicant’s goods. Traders may legitimately want to use such words in connection with their goods or services “because of the reference they are ‘inherently adapted to make’ to those goods”: Cantarella Bros Pty Limited v Modena Trading Pty Limited (“Cantarella”) [2014] HCA 48; (2014) 254 CLR 337 at [57] per French CJ, Hayne, Crennan and Kiefel JJ.

   
   
   

   (5) The principles derived from the observations of Kitto J in Clark Equipment apply with as much force to directly descriptive words as they do to words which are, according to their ordinary signification, geographical names: Cantarella at [57].

   
   
   

   (6) In determining whether a word is (or words are) inherently adapted to distinguish the goods or services of an applicant, the question is to be examined from the point of view of the “possible impairment” of the rights of “honest traders” and from the “point of view of the public”: Cantarella at [59].

   
   
   

   (7) In determining whether a word contains (or words contain) a “direct reference” to the relevant goods or services (and thus prima facie not registrable as a trade mark) or whether the word (or words) makes a “covert and skilful allusion” to the relevant goods or services (and thus prima facie registrable as a trade mark), the “ordinary signification” of the word or words to persons who will purchase, consume or trade in the goods or services, must be considered: Cantarella at [59].

   
   
   

   (8) Where the question is whether there are other traders who may legitimately want to use or apply a word or words in connection with their goods or services (other than a geographical name or a surname), the test refers to the “legitimate desire of other traders to use a word which is directly descriptive in respect of the same or similar goods”: Cantarella at [59].

   
   
   

   (9) Consistent with the proposition at (7), the test described at (8) does not encompass the desire of other traders to use a word or words which in relation to the goods or services are “allusive or metaphorical”: Cantarella at [59].

   
   
   

   (10) In determining whether a trade mark is inherently adapted to distinguish the designated goods or services for the purposes of s 41(3), the ordinary signification of the word or words are to be considered from the perspective of “any person in Australia concerned with the goods or services to which the trade mark is to be applied”: Cantarella at [70].

   
   
   

   (11) Consideration of the “ordinary signification” of any word or words said to constitute a trade mark is “crucial”: Cantarella at [71]. That is so whether the word (or words) is said not to be registrable because: it is not an invented word and has direct reference to the character or quality of the goods or services; or, the word is laudatory; or, the word is a geographical name; or, the word has either lost its distinctiveness or it never had the requisite distinctiveness from the outset: Cantarella at [71].

   
   
   

   (12) The process of reasoning in addressing s 41(3) of the Act involves first identifying the “ordinary signification” of the word in question and then undertaking an enquiry into whether other traders might legitimately need to use the word in respect of their goods: Cantarella at [71]. If a word contains an allusive reference to goods or services it is, prima facie, qualified for the grant of a monopoly as a trade mark under the Act. If, on the other hand, the word is understood, by the target audience, as having a directly descriptive meaning in relation to relevant goods or services then, prima facie, the proprietor is not entitled to a monopoly in respect of the word. As a general proposition, a word or words which are prima facie entitled to a monopoly secured by registration as a trade mark under the Act, according to this method, are inherently adapted to distinguish: Cantarella at [71]. [4]

   [4] [2017] FCAFC 56 at [236].

10. No examiner has raised the s 41 ground of opposition in respect of the Applicant’s Goods, only the Identified Goods which are no longer the subject of this application. I am satisfied that IWATCH is inherently adapted to distinguish the Applicant’s Goods, being GPS devices, from the goods or services of other persons and capable, on that basis alone, of so distinguishing the Applicant’s Goods. The Trade Mark is not in any way descriptive of the Applicant’s Goods and there would be no need for other traders to use the word in respect of the Applicant’s Goods. The ground for rejection has not been established.

    Decision

11. Section 33 of the Act relevantly provides:

    33Application accepted or rejected

    (1)The Registrar must, after the examination, accept the application unless he or she is satisfied that:

    (a)the application has not been made in accordance with this Act; or

    (b)there are grounds under this Act for rejecting it.

    (2)The Registrar may accept the application subject to conditions or limitations.

    (3)If the Registrar is satisfied that:

    (a)the application has not been made in accordance with this Act; or

    (b)there are grounds under this Act for rejecting it;

    the Registrar must reject the application.

12. As I am not satisfied that there is a ground for rejection under s 41 of the Act in relation to the Trade Mark, I accept the application to register the Trade Mark.

    Nicholas Smith

    Hearing Officer

    Oppositions and Hearings

    17 February 2020