Bx Trade S.r.l. v Coswell S.p.a

[2010] ATMO 65

TRADE MARKS ACT 1995

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

Re:Oppositions by BX Trade S.r.l. to application under section 92 of the Act by Coswell S.p.a to remove trade mark number 944472 (3) - BLANX (stylised) - in the name of BX Trade S.r.l.

Delegate:

Heath Wilson

Representation:

Opponent – Not represented.

Removal Applicant – Attendance via telephone by Eric Ziehlke of Chrysiliou Law, Patent and Trade Mark Attorneys.

Decision:

2010 ATMO 65

Section 92(4)(b) – Use of the trade mark in Australia – in good faith – Non-use established and trade mark to be removed from the register – costs awarded against the opponent.

Background

1.     Bx Trade S.r.l (“the opponent”) is the registered owner of trade mark registration no. 944472 (“the Trade Mark”) filed on 20 February 2003, relevant details of which are as follows:

Trade Mark	Class / Statement of Goods
Class: 3 Toothpaste; mouthwash (non-medicated); tooth-care products included in this class

2. On 10 April 2008, Coswell S.p.a. (“the removal applicant”) filed an application under section 92(4)(b) of the Trade Marks Act 1995 (“the Act”) for removal of the trade mark from the register in respect of all of the goods, alleging the trade mark was not used in good faith in relation to any of the goods during the three year period ending on 10 March 2008 (“the non-use period”).

3.     I heard the matter in Canberra as delegate of the Registrar of Trade Marks on 12 July 2010. Eric Ziehlke of Chrysiliou Law, Patent and Trade mark Attorneys appeared via telephone on behalf of the removal applicant and also filed written submissions. The opponent did not appear at the hearing, nor did it file written submissions, despite having legal representation throughout the evidence stages of the matter.  

Evidence

Evidence in Support

·Statutory declaration of Giuliano Ponchio (President of the opponent) dated 7 November 2008 with attached exhibits GP-1 and GP-2 (“the Ponchio declaration”).

·Statutory declaration of Sergio Orsillo dated 10 November 2008 with attached exhibits SO-1 and SO-2 (“the Orsillo declaration”).

Evidence in Answer

·Statutory Declaration of Paolo Gualandi (President of the removal applicant) dated 21 April 2009 with attached exhibits PG-1 to PG-9 (“the Gualandi declaration”).

Evidence in Reply

·Statutory Declaration of Giuliano Ponchio and statutory declaration of Davide Marchi (Italian attorney at law), both dated 22 October 2009 (“the 2^nd Ponchio declaration”).

The Law

4.     Section 92(4)(b) of the Act provides:

(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:

(a)….

(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.

Note 1:For file and month see section 6.

Note 2:If non‑use of a trade mark has been established in a particular place or export market, then instead of the trade mark being removed from the Register, conditions or limitations may be imposed under section 102 on the registration of the trade mark so that its registration does not extend to that place or export market.

Onus

5. Sections 100(1)(c) and 100(3) of the Act make it clear that the opponent bears the onus of rebutting an allegation made under s92 (4)(b), by establishing use of the trade mark (or the trade mark with additions or alterations not substantially affecting its identity) in good faith within the non-use period. I proceed on the basis that the relevant standard of proof is on the balance of probabilities.[1] 

[1] Following Gyles J in Pfizer Products Inc v Karam (2006) 70 IPR 599 and Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891 (18 August 2009) at [22] to [26].

Reasons

6.     A single bona fide use of the trade mark during the relevant non-use period can be sufficient to defeat an application for removal.[2] In such a case, however, such use should be established by “if not conclusive proof, at any rate overwhelmingly convincing proof.”[3]

[2] Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261 (2001) 51 IPR 149 at 17.

[3] Nodoz Trade Mark (1962) RPC 1 at 7 per Wilberforce J.

7.     Both the Ponchio declaration and the Orsillo declaration attach copies of invoices, highlighting two alleged instances of trade mark use.  The first invoice, bearing “no. 07319” and dated 15 November 2007 is for “12 pcs Blanx Whitening Toothpaste ‘Classic’ 100ml”. Da Galeno Officine Cosmetiche (‘Da Galeno’) is the seller of the goods on the invoice and the recipient is Sergio Orsillo. While the opponent has not supplied proof of the business relationship it may have with Da Galeno, Mr. Ponchio does declare that Da Galeno is the “opponent’s licensee.”[4] Mr. Orsillo’s Australian address appears at the top of the invoice. However, it is apparent that the goods themselves were not delivered to that address but, as Mr. Orsillo declares, delivered to him personally in Hong Kong. As regards these goods, Mr. Orsillo declares[5] that:

I brought the First Batch of Goods back to Australia and between November and December 2007, I showed samples from the First Batch of Goods to representatives of various Australian distributors, including Priceline. I also sent samples … to representatives of Priceline and Terry White Chemists at that time.

[4] Ponchio declaration, paragraph 8.

[5] Orsillo declaration, paragraph 3.

8.     The second invoice no. 8071 is dated March 11 2008 and falls just outside the non-use period. In paragraphs 4 and 5 of his declaration, Mr. Orsillo declares that the order was placed in January 2008 and the goods delivered to him personally in Italy in February 2008. This invoice was also sent to Mr. Orsillo at his Australian address, but the invoice itself does not specify when those actual goods were delivered. This invoice is addressed to the same buyer, for the same product and amount of toothpaste as that described above, but this time Mr. Orsillo says that the goods were delivered to him personally in Napoli, Italy. In relation to this second order, Mr. Orsillo declares[6]:

I brought the samples back to Australia in February 2008. Between February and March 2008, I again telephoned various trade outlets about the toothpaste samples bearing the BLANX trade mark. I also sent samples from the Second Batch of Goods to representatives of various trade outlets at that time for their evaluation.

[6] Orsillo declaration, paragraph 5.

9.     These two invoices comprise the extent of the opponent’s evidence of use of the unstylised word trade mark “Blanx”. Beyond the above declarations, no further evidence of product samples or any correspondence has been provided by the opponent. While the distribution of samples of the product may constitute use in certain circumstances, the opponent has not provided any corroborating evidence regarding its preparations for the use of the Trade Mark, apart from the bald statements concerning such preparations. In a number of hearings before the Registrar, it has been observed that mere assertions of use without documentary support generally merit little weight[7], and it has also been held that mere preliminary discussions and negotiations are not sufficient to amount to use of a trade mark.[8]

[7] See Great White Shark Enterprises Inc v Joose Apparel Pty Ltd (1998) 41 IPR 208, Steen Petersen v Daniel Baden and Garth Harris [2003] ATMO 83.

[8] Moorgate Tobacco Co Ltd v Phillip Morris Ltd (No 2) (1984) 156 CLR 414.

10.   In addition, there is no evidence illustrating the presentation of the trade mark on the goods themselves, other than the way it is produced on the invoices discussed above, namely in plain script as “Blanx”. Despite this fact, I find the variation in the presentation of the trade mark does not substantially affect its identity. Mr. Ziehlke submitted that the inclusion of the word “Classic” on the invoices may also be an addition which substantially affects the identity of the opponent’s Trade Mark. Considering its placement in relation to the Trade Mark on the invoice (as stated above), I do not agree with this submission.

11.   In relation to the initial supply of the 24 tubes of toothpaste, the invoices and the declarations both establish that these transactions took place overseas, firstly in Hong Kong, and secondly in Naples. In Gallo Winery v Lion Nathan Australia Pty Limited[9] the High Court observed that:

An overseas manufacturer who has registered a trade mark in Australia and who himself (or through an authorised user) places the trade mark on goods which are then sold to a trader overseas can be said to be a user of the trade mark when those same goods, to which the trade mark is affixed, are in the course of trade, that is, are offered for sale and sold in Australia. 

[9] Gallo Winery v Lion Nathan Australia Pty Limited [2010] HCA 15 [at 52]

12. The opponent does not need to retain control of the goods or be aware that they are being sold in Australia for such sales to constitute use in Australia “in the course of trade”. However, while there may have been an overseas sale, I am not satisfied that any subsequent sales or offers for sale of the product occurred in Australia within the relevant period. The evidence in this regard is inconclusive. Consequently, I find that there has not been any use of the Trade Mark in Australia, and the opponent has not discharged the onus it bears pursuant to section 100 of the Act.

“In Good Faith”

13. For the sake of completeness, I will address the remaining evidence of the removal applicant to the extent that it purports to address the concept of trade mark use “in good faith” under s 92(4)(b) of the Act. The Gualandi declaration highlights the fact that the removal applicant owns “BLANX (stylised)” trade marks which are identical to the opponent’s registration, and are registered in Italy, the European Community and on the International Register under the Madrid Protocol. The declaration also points to a deed between the removal applicant and an Italian company called Keraunos S.r.l (‘Keraunos’) executed on behalf of Keraunos by its Managing Director Claudia Cavagnini, regarding the transfer of those trade mark registrations to the removal applicant. As collateral to this deed of transfer, an additional deed was signed by Ms Claudia Cavagnini in her capacity as director of Keraunos. This deed was signed on 18 November 2002 and contained an undertaking that Keraunos and its directors could not use trade marks with “the BLANX suffix” and additionally states that: “Keraunos, through its directors and Mr. Ponchio have signed a three-year non-competition agreement’.[10] Mr. Ponchio expressly denies this, and also declares that he has never been a director of Keraunos. However, the Italian company searches submitted by the removal applicant indicate that Ms Cavagnini is also a director of the opponent,[11] along with Giuliano Ponchio.

[10] Gualandi declaration, exhibit “PG-4”.

[11] Exhibit “PG-6”.

14.   The declaration also annexes documents relating to a complaint against the opponent’s distributor Da Galeno for alleged “production, distribution and marketing of products with the Trade Mark in Italy & Europe”[12] following which, items and packaging bearing the Trade Mark were seized by the Italian authorities responsible for policing tax matters. While this incident does not necessarily prove that the removal applicant’s “BLANX (stylised)” trade mark had been infringed, but it does provide some insight into the relationship of the parties and the conduct of the opponent’s distributor overseas.

[12] Gualandi declaration, paragraph 11.

15.   Given the above documents and events, the requirement that the trade mark use occur “in good faith” was raised by the attorney for the removal applicant. To support this contention that the opponent’s trade mark use was not in good faith, the submission put forward was that any use in the relevant period proven by the opponent had occurred dishonestly (and also potentially in breach of the above transfer deed).

16.   It is questionable whether or not this evidence goes to the ‘good faith’ of the opponent, given the interpretation of the expression by the Federal Court. Mr. Ziehlke referred to previous decisions of the Registrar including Bunter v Hoborama LLC[13] and Edwards v Liquid Engineering[14].  However, the interpretation of the expression ‘in good faith’ favoured in those decisions before the Registrar have been superseded by the comments in the Federal Court appeal to the latter case[15], where it was said (emphasis added):

…I was poised to answer that question in the affirmative and uphold the appeal, on the basis that “good faith” for the purposes of s 92(4) requires no more than genuine intent to use a mark for commercial purposes; it does not involve any element of honesty or subjective good intentions:  see generally E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2008] FCA 934 at [187]-[192]…

[13] Bunter v Hoborama LLC (2005) 67 IPR 216, and also referred to KD Rausch Pty Limited v Oettinger Brauerei GmbH (2003) 60 IPR 461.

[14] Edwards v Liquid Engineering2003 Pty Limited (2006) 70 IPR 374.

[15] Edwards v Liquid Engineering 2003 Pty Ltd [2008] FCA 970 at [8].

17.   Subsequently, the Full Bench of the Federal Court decided[16] that:

In the present case having regard to the above authorities, we do not consider that her Honour erred when she observed at [8] of her reasons that s 92(4) of the Act requires no more than a genuine intent to use the mark for commercial purposes, and that the reference to bona fide intention to use is not sufficiently wide to encompass the circumstances of the present case.

In our view the conclusion of her Honour on this issue was correct…

[16] (After referring to a number of cases including Woolly Bull Enterprises) [at 56-57]:

18.   Therefore, the relevant issue is whether the use of the trade mark in the relevant period was genuine or bona fide, rather than whether it was actuated by improper motives. However, in the Barefoot[17] case before the High Court, it was also noted that:

In Imperial Group Ltd v Philip Morris & Co Ltd[18] ("Imperial Group"), it was held that use of a trade mark for a purpose other than deriving profit and establishing goodwill is not use as required by the legislation.[19] It has also been held that contriving use for the purpose of defeating a trade rival's plans will lack the necessary quality of genuineness.[20]

[17] E & J Gallo Winery v Lion Nathan Australia Pty Limited [2010] HCA 15 [at 62].

[18] [1982] FSR 72.

[19] Imperial Group Ltd v Philip Morris & Co Ltd [1982] FSR 72 at 83 per Shaw LJ

[20] Concord" Trade Mark [1987] FSR 209.

19. Despite the above actions highlighted by the removal applicant, I am not convinced that the actions were for a purpose other than deriving profit in Australia and it is unnecessary to determine whether any established use by the opponent was contrived. Regardless of the issue of ‘good faith,’ the evidence submitted by the opponent has not shifted the onus to the removal applicant to establish that the alleged instances of use were not genuine. I am not satisfied that the opponent’s use of the Trade Mark in Australia is supported by conclusive proof. For the reasons given above in relation to the provided invoices, I find that there has not been any established use in Australia of the trade mark within the three year period. The ground under section 92(4)(b)(i) of the Act has been established.

Decision

101 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.

20. The application for removal under s92(4)(b) of the Act has been successful. In addition, I can find no reason for the Registrar’s discretion to be exercised to allow the Trade Mark to remain on the register. Under section 101(1) of the Act, I direct that trade mark registration no. 944472: “BLANX (stylised)” be removed from the Register one month from the date of this decision. If the Registrar is served with a notice of appeal on or before the end of that month, the registration will be subject to the decision made by the Federal Court.

Costs

21. The opposition has not been established, and the removal application is therefore successful. Accordingly, I award costs against the opponent to the extent allowed under the official scale set out in Schedule 8 of the Trade Marks Regulations 1995.

Heath Wilson

Hearing Officer

Trade Marks Hearings

23 July 2010