Canberra Insulation Specialists Pty Ltd v Ross William Kestle

[2022] ATMO 108

TRADE MARKS ACT 1995

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

Re:Opposition by Canberra Insulation Specialists Pty Ltd to application under section 92 of the Trade Marks Act 1995 (Cth) by Ross William Kestle for removal of trade mark number 1947822 (Class 17) – Insulbloc – in the name of Canberra Insulation Specialists Pty Ltd.

Delegate:

Blake Knowles

Representation:

Opponent: Trinity Law.  

Applicant: Acumen Intellectual Property.    

Decision:

2022 ATMO 108

Trade Marks Act 1995 (Cth) – application for removal under s 92(4)(a) – consideration of information under reg 21.15(4) and 21.19 – opposition to removal established - trade mark to remain registered.

Background

1. Ross William Kestle (‘Removal Applicant’) on 21 September 2020 filed an application under s 92(4)(a) of the Trade Marks Act 1995 (Cth)0F[1] (‘Removal Application’) for the complete removal of the following registered trade mark (‘Registration’):

   [1] Unless otherwise stated, each reference to a section or regulation in these reasons is a reference to the Trade Marks Act 1995(the ‘Act’) or the Trade Marks Regulations 1995 (Cth) (the ‘Regulations’), respectively.

   Trade Mark Number:  1947822

   Trade Mark:  Insulbloc

   (‘Trade Mark’)

   Class 17: Thermal insulation material

   (‘Goods’)

2. Canberra Insulation Specialists Pty Ltd (‘Removal Opponent’) is the owner of the Registration. The Removal Opponent filed a notice of intention to oppose the Removal Application on 17 November 2020, followed by a statement of grounds and particulars (‘SGP’) on 15 December 2020. The Removal Applicant filed a notice of intention to defend the opposition to the Removal Application on 12 January 2021.

3. The parties were given the opportunity to file evidence in accordance with the timetable set out in reg 9.16. The Removal Opponent filed Evidence in Support (‘EIS’) on 22 February 2021. The Removal Applicant did not file Evidence in Answer.

4. Both parties requested to be heard by way of written submissions and paid the relevant fees. The hearing was scheduled for 14 March 2022 and the parties were provided with a timetable for the filing of their written submissions. Submissions for the Removal Opponent were filed by Trinity Law on 28 February 2022. Submissions for the Removal Applicant were filed by Acumen Intellectual Property on 7 March 2022.  

5. On 11 March 2022, after receiving the Removal Applicant’s submissions, the Removal Opponent sought to file further submissions and additional evidence (‘New Evidence’). On 18 March 2022, I wrote to the parties indicating that while I would allow the further submissions, the Removal Opponent had not provided sufficient reasons why I should consider the New Evidence under the provisions of reg 21.15(4) and 21.19. On 31 March 2022, the Removal Opponent subsequently filed additional submissions in relation to reg 21.15(4) and 21.19. On 13 May 2022, after consideration of the Removal Opponent’s further submissions, I wrote to the parties proposing to consider the New Evidence, subject to consideration of any additional submissions or evidence filed by the Removal Applicant. On 14 June 2022, the Removal Applicant filed submissions in relation to the New Evidence.

6. I have decided this matter as a delegate of the Registrar based on the particulars in the SGP, and the evidence and submissions filed by the parties.

   Evidence

   EIS

7. The EIS consists of a declaration by Steven McMahon, a solicitor of Trinity Law acting on behalf of the Removal Opponent, made on 22 February 2021 with Exhibits A to D.

8. Mr McMahon declares that the facts contained in his declaration are known to him by virtue of instructions from the Removal Opponent.

9. Mr McMahon declares that the Insulbloc system is a two component, self-adhering, seamless, closed cell, spray applied polyurethane foam system. The Opponent formed the intention to import and use the Insulbloc system in 2017. In that year, the Opponent’s director also obtained a quote from another company, Australian Urethane Systems (‘AUS’), for equipment packages used in the application of the Insulbloc system. The Opponent also first used the Insulbloc system in 2017. In the calendar year ending 2020 the Opponent had installed over 81 tonnes of spray foam insulation products, of which the Insulbloc system was a ‘significant component’.

10. Mr McMahon annexes the following exhibits:

    (a)An undated ‘Insulation Fact Sheet 11-017 Spray Foam System’. The fact sheet relates to the Insulbloc system offered by US company, NCFI Polyurethanes (‘NCFI’).

    (b)Emails dated 12 June 2019 between Jeremy Watson of Alexander Watson Home Insulation and a representative of NCFI regarding an enquiry made by Mr Watson.

    (c)An email dated 24 May 2017 sent by a representative of AUS to Mr Watson enclosing a quotation for Graco spray gun packages, spare parts, solvents, and spray foam systems, and a brochure for Graco Reactor spray foam and Polyurea equipment.

    (d)A printout dated 10 December 2020 from the website (‘AW Website’) which refers to the Trade Mark, including in the sentence ‘our Insulbloc® spray foam insulation product is highly versatile and can be applied in a continuous and seamless spray creating a uniform membrane’.    

11. It is necessary at this point to comment on the significant deficiencies in the EIS, given it was criticisms of the EIS made by the Removal Applicant in submissions that prompted the Removal Opponent to file New Evidence. These deficiencies are relevant to my consideration below regarding whether to take into account the New Evidence under reg 21.15(4) and 21.19.  

12. Firstly, the EIS consists of a declaration by the Removal Opponent’s solicitor. Given that s 92(4)(a) is partly concerned with the subjective intention of the Removal Opponent at the time of filing the Trade Mark, it would have been more appropriate if the declaration was made by a director or senior employee of the Removal Opponent and not its legal counsel. The declaration also does not specify the name and position of the officer or employee of the Removal Opponent who provided the information forming the basis of Mr McMahon’s declaration.

13. Secondly, exhibits (b), (c), and (d) relate to a business called ‘Alexander Watson Home Insulation’. However, there is no clear explanation of the connection between this business name and the Removal Opponent.  The remaining exhibit (a) is an undated fact sheet produced by an unrelated entity, NCFI Polyurethanes, and as such, use of the Trade Mark on that fact sheet also does not assist the Removal Opponent’s case.

14. Thirdly, exhibits (b) and (c) make no mention of the Trade Mark. Exhibit (b) is email correspondence with NCFI relating to an unspecified product. Exhibit (c) relates to the purchase of various products (sold under different brands) by AUS. At most, each of these exhibits supports the contention that Alexander Watson Home Insulation is an installer of home insulation and that it sought business supplies from third parties in Australia and overseas.

    New Evidence

15. The New Evidence consists of a second declaration by Mr McMahon, made on 11 March 2022, with twenty annexures.

16. Mr McMahon declares that the matters declared in his first and second declaration are based on information given to him by Mr Jeremy Watson, a director of the Opponent. It is somewhat perplexing, given the Removal Applicant criticised the EIS on the basis it was made by the Removal Opponent’s solicitor, that the Removal Opponent chose to file a second declaration also made by its solicitor. There is no reason provided why Mr Watson could not provide his own declaration. The position of the declarant and the decision by Mr Watson not to provide direct evidence may be taken into account in deciding what weight to give the evidence.

17. Mr McMahon annexes an Infotrack ASIC extract snapshot (‘Infotrack Extract’) which confirms that Mr Watson is the sole director of the Removal Opponent and was appointed on 15 June 2020. However, I note that the Infotrack Extract does not indicate who was or were the previous director/s before the appointment of Mr Watson. Mr McMahon also clarifies that the Removal Opponent trades as ‘Alexander Watson Insulation’ and annexes an ABN Lookup printout which confirms the business name ‘Alexander Watson Insulation’ has been registered to the Removal Opponent since 2015.

18. Mr McMahon declares that the Trade Mark has been used since late 2017 in relation to a polyurethane insulation spray foam system. Mr McMahon annexes photographs provided by Mr Watson which show spray foam insulation installed at properties in 2018 and 2020, and invoices issued by Alexander Watson Home Insulation[2] dated 16 April 2018, 27 November 2020, and 9 February 2022. The 2018 invoice describes the services provided as: ‘Supply and install Insulbloc closed cell spray foam to ceiling and walks of cellar area. Guaranteed R2.0 rating with 100% air seal and gap free coverage’. The other invoices refer to the ‘supply and install’ of Insulbloc spray foam in a similar manner, amongst other goods and services provided.

    [2] I note that while the Removal Opponent’s registered business name is ‘Alexander Watson Insulation’, and invoices are issued under the slightly different name ‘Alexander Watson Home Insulation’, the ABN on the invoices matches the ABN of the registered business name.

19. Mr McMahon annexes WHOIS domain name details for the AW Website which indicates the registrant for the domain is the Removal Opponent. Also annexed are Internet Archive Wayback Machine printouts for the AW Website, including two dated 27 February 2020 and 8 March 2020. The printouts include the sentence ‘Our Insulbloc® spray foam insulation product is highly versatile and can be applied in a continuous seamless spray creating a uniform membrane’. Another annexure is a Domain Tools Domain Report for the AW Website which indicates the domain name has been owned by the Removal Opponent since at least 2018. Prior to that, the domain name was owned by the Removal Applicant.

    Grounds, onus and standard

20. The Removal Application nominates grounds for removal under s 92(4)(a) in relation to all of the Goods. Section 92(4)(a) states:

    92 Application for removal of trade mark from Register etc.

    (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)  that, on the day on which the application for the registration of the trade mark was filed, the applicant for registration had no intention in good faith:

    (i)to use the trade mark in Australia; or

    (ii)to authorise the use of the trade mark in Australia; or

    (iii)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 to which the non-use application relates and that the registered owner:

    (iv)has not used the trade mark in Australia; or

    (v)has not used the trade mark in good faith in Australia;

    in relation to those goods and/or services at any time before the period of one month ending on the day on which the non-use application is filed.

21. The ground alleged under s 92(4)(a) is for the Removal Opponent to rebut.1F[3] Findings of fact in this decision are based on the civil standard of the balance of probabilities.

    [3] Trade Marks Act 1995 (Cth) s 100(1)(c).

22. For the purposes of the opposition, the date at which I must determine the existence of the Removal Opponent’s intention in good faith to use the Trade Mark in relation to the Goods is 18 August 2018 (‘Filing Date’). I must also determine whether there has been any actual use of the Trade Mark in good faith in relation to the Goods in the period ending one month prior to the filing of the Removal Application. As the Removal Application was filed on 21 September 2020, I must determine whether any use occurred before 21 August 2020 (‘Relevant Period’). If the Removal Opponent establishes either the requisite intention to use the Trade Mark at the Filing Date, and/or relevant use of the Trade Mark during the Relevant Period, the opposition to removal will succeed.    

23. The Removal Opponent relies on both evidence of intended use of the Trade Mark at the Filing Date and use of the Trade Mark during the Relevant Period.2F[4] Further, I also have a general discretion to allow the Trade Mark to remain registered even if the Removal Opponent does not establish either the requisite intention to use or relevant use of the Trade Mark.

    Discussion

    [4] Ibid s 100(3)(a).

    Consideration of New Evidence under reg 21.15(4) and 21.19

24. Under reg 21.15(4), the Registrar is not bound by rules of evidence, but may be informed on any matter before the Registrar in a way that the Registrar reasonably believes to be appropriate. Under reg 21.19, the Registrar may propose to take into account information that is relevant to the proceedings. If the Registrar has reason to believe that the information that she intends to take into account is not known to a party, the Registrar must provide the information to the party and give the party a reasonable opportunity to make representations.

25. The Trade Marks Office Manual of Practice and Procedure[5] provides some guidance on the factors to be considered in deciding whether to allow late filed evidence. These include:

    ·Why the evidence was filed after the due date.

    ·If the evidence stage in proceedings has concluded and the matter is ready for determination, why the evidence was not filed earlier.

    ·What the evidence shows.

    ·Why that information is crucial to the delegate’s decision.

    ·Why it is in the public interest to have the information considered.

    ·What is the balance of convenience for the parties if the information is considered.

    [5] Part 51.2.5.

26. In Fed Square Pty Ltd v Federation IP Pty Ltd (‘Fed Square’), Hearing Officer Wilson said:

    In order to determine whether or not to take information into account under Reg 21.19 it is necessary for an administrative decision maker to consider the nature and significance of the evidence put forward. If that material is of high probative value, that will be a crucial factor in the determination of whether it should be admitted.[6]

    …

    Parties should not attempt to circumvent the extension of time provisions under the misguided assumption that Regulation 21.19 will apply in every case. Furthermore, while it is available to parties, it is clear that Regulation 21.19 should not be perceived or used as a substitute for the now repealed provisions allowing for the filing of further evidence (or, indeed any available evidence stage).[7]

    …

    The implications of evidence not being filed at all should inform the parties’ decisions made around the preparation of the evidence, and it is not sufficient to simply show that such evidence is relevant and there is a possibility that the opposition may fail without it. To allow regulation 21.19 to be utilized in that way may render the requirements for the current extension of time provisions otiose. Rather, there must be further circumstances that make it reasonable for the material to be taken into account. In the current matter and for the reasons set out earlier I am satisfied that they have been in this case.[8]

    [6] [2015] ATMO 42, [50].

    [7] Ibid, [54].

    [8] Ibid, [55].

27. It was also acknowledged in Fed Square that the possibility of a de novo appeal to the Federal Court is a relevant consideration in deciding whether to exercise discretion to consider information under reg 21.19.[9] There are obvious cost and efficiency benefits to both the parties and the public in a matter being decided at first instance before the Registrar rather than a court. However, this alone is not a reason to exercise discretion to consider late filed evidence, otherwise every party who seeks to file late evidence could simply claim they intend to file a de novo appeal if discretion is not exercised in their favour.

    [9] Fed Square (n 2), [44].

28. The Removal Opponent initially based its request to file New Evidence on the contention that the Removal Applicant had raised three ‘new issues’ in submissions, namely that (a) the Removal Applicant alleged the Trade Mark is not owned by the Removal Opponent, (b) the Removal Applicant alleged the evidence contained in the Removal Opponent’s evidence should be discounted as it was not first-hand knowledge, and (iii) that the Registrar should consider the Removal Applicant’s previous trade mark registration (number 1340611) and subsequent trade mark application (number 2117150), both for the Trade Mark, in making a decision. The Removal Opponent also submitted that the Removal Applicant had ‘ample opportunity to raise these issues in its Evidence in Answer’ and that an adverse inference should be drawn against the Removal Applicant for its failure to do so.

29. I did not find these submissions persuasive. With regard to points (a) and (b), the issues raised by the Removal Applicant were criticisms of the Removal Opponent’s evidence which went towards whether the Removal Opponent had met its onus in the opposition. The Removal Applicant was not obliged to file Evidence in Answer simply to put the Removal Opponent on notice of criticisms of the Removal Opponent’s own evidence. Such material would not even be evidence in the true sense of the word. The Removal Opponent, with the benefit of legal counsel, should have been able to anticipate any likely criticisms of its position and prepare its evidence accordingly. With regards to point (c), the existence of a prior registration and current application in the name of the Removal Applicant is publicly available information and was in any event of peripheral relevance. As such, I advised that I intended to not consider the New Evidence unless the Removal Opponent provided persuasive reasons for me to do so.

30. Subsequently, the Removal Opponent made additional submissions which argued that the New Evidence is ‘centrally relevant to the issue before the Delegate’ and that it is in the public interest ‘to ensure the delegate’s decision is based upon evidence traversing the full facts’.

31. I agree with the Removal Opponent that the New Evidence is centrally relevant, and its probative value is an important consideration. Without the New Evidence, the Removal Opponent’s case fails due to the deficiencies in the EIS mentioned earlier. Further, if the Trade Mark has been used in good faith by the Removal Opponent, there is no public interest served by its removal. I also note that if I decline to consider the New Evidence and decide the Trade Mark should be removed, this raises the possibility of an appeal to the Federal Court. As an appeal would be de novo, the Removal Opponent would be able to file evidence afresh. The significant cost of an appeal and its use of scarce public resources is another compelling consideration for taking into account the New Evidence, as this reduces the likelihood of the matter unnecessarily escalating to litigation.

32. On the other hand, I must weigh up the desirability of considering the New Evidence given that it was filed very late and could easily have been filed much earlier as part of the EIS. The evidence required to defeat a claim under s 92(4)(a) is not complex, nor would it have been onerous to prepare in this case given relevant business records and website data existed and was readily available. It is also not fair that the Removal Applicant be unduly disadvantaged by diligently filing submissions which alleged deficiencies in the EIS. Routinely allowing evidence to be filed late in direct response to hearing submissions may encourage parties to do the same in other proceedings if it suddenly occurs to them that their initial evidence may have been inadequate.

33. On balance, I consider that the probative value of the New Evidence, the public interest in deciding the matter based on all relevant material, and the consequences of declining to consider the New Evidence, are sufficiently persuasive and outweigh the reasons for not considering the New Evidence. I also consider that the balance of convenience favours the Removal Opponent, as it stands to lose statutory rights in a Trade Mark which appears to have been in use. As such, and not without some reluctance, I have decided to exercise discretion to take the New Evidence into account under the provisions of reg 21.15(4) and 21.19.

    Intention to use the Trade Mark at the Filing Date, and use of the Trade Mark during the Relevant Period

1. The intention to use the Trade Mark in good faith and/or the actual use of the Trade Mark in good faith required to be demonstrated by the Removal Opponent is ‘use as a trade mark’. ‘Use as a trade mark’ is use of the sign as a badge of origin in the sense that it indicates a connection in the course of trade between the goods and the person who applies the sign to or in relation to those goods.4F[10] Use in the course of trade means an actual dealing in the goods, an offer for sale of goods, or an intention to offer for goods for sale manifested through preparatory steps showing an objective commitment to use the trade mark.5F[11]

   [10] Coca-Cola Co v All-Fect Distributors Ltd [1999] FCA 1721, [19] (Black CJ, Sundberg, and Finkelstein JJ).

   [11] Angela Christou v Tonch Pty Ltd [2008] ATMO 24; see also Dick Smith Investments Pty Ltd v Ramsey[2001] FCA 261 (Katzmann J).

2. In Woolly Bull Enterprises Pty Ltd v Reynolds (‘Woolly Bull’), Drummond J observed that the expression ‘use in good faith’ has a well understood meaning in terms of s 92 of the Act, namely it is ‘real, as opposed to token, use in a commercial sense’.6F[12] In Liquideng Farm Supplies Pty Ltd v Liquid Engineering 2003 Pty Ltd (‘Liquideng’) the Full Federal Court confirmed that s 92(4) required no more than a genuine intent to use the mark for commercial purposes, and rejected other authorities that took a broader view of what constituted ‘good faith’.[13] Provided the use is in good faith, ‘a single bona fide use of the mark’ may be enough to rebut an allegation of non-use.7F[14] However, if a single act of use is relied upon then it should be established by ‘if not conclusive proof, at any rate overwhelmingly convincing proof’.8F[15]

   [12] [2001] FCA 261, [16].

   [13] [2009] FCAFC 7, [52] – [56] (Tamberlin, Sundberg, and Besanko JJ).

   [14] Ibid, [17].

   [15] Nodoz Trade Mark (1962) RPC 1, 7 (Wilberforce J).

3. The Removal Applicant criticised both the EIS and the New Evidence on the basis that it was not directly given by an officer of the Removal Opponent and Mr McMahon did not state in his declaration whether he had confirmed whether the information given to him was true and correct. I agree that the information provided to Mr McMahon by Mr Watson should ideally have been in a declaration executed by Mr Watson himself, and I cannot see any practical reason why this was not so. I also note that Mr Watson may not have been a director of the Removal Opponent at the Filing Date, which casts some doubt over whether he is in a position to give evidence as to the Removal Opponent’s subjective intention at the Filing Date.  

4. Without the annexures to the New Evidence, I would have given the declaratory evidence of Mr McMahon regarding the Removal Opponent’s intention to use the Trade Mark little weight. However, the annexures to the New Evidence cast further light on both the intention of the Removal Opponent at the Filing Date and its actual use of the Trade Mark during the Relevant Period. In the absence of evidence which indicates that the annexures were falsified or inaccurate, they provide a basis for me to objectively determine both the Removal Opponent’s intention to use the Trade Mark at the Filing Date, and use of the Trade Mark during the Relevant Period.

5. I consider that the annexures showing use of the Trade Mark on the AW Website in February and March 2020, in addition to the invoice of 16 April 2018, constitute use of the Trade Mark by the Removal Opponent in relation to the Goods during the Relevant Period. I also consider that the AW Website evidence, together with the invoice issued by the Removal Opponent on 16 April 2018, objectively confirm the Removal Opponent’s intention to use the Trade Mark for genuine commercial purposes in relation to the Goods at the Filing Date. It is also clear from the New Evidence that the Trade Mark was used in relation to a good supplied by the Removal Opponent, rather than merely being used in relation to services. The Removal Opponent’s services are provided under the brand and business name ‘Alexander Watson Home Insulation’ and ‘Alexander Watson Insulation’.

6. I note the Removal Applicant’s submissions regarding the prior use of the Trade Mark by NCFI in the USA and the Removal Opponent’s admission that it sought to bring the NCFI product to Australia. Further, I also note that the Removal Applicant previously held a registration for the Trade Mark for various insulation products (trade mark number 1340611) that lapsed in 2011, and that the Removal Applicant has filed another application for the Trade Mark in 2020 (trade mark number 2117150) that is currently pending.

7. The prior use of the Trade Mark by a person other than the Removal Opponent may give that other person a basis for challenging the validity of the Registration. However, in the present matter, the only issues for consideration under s 92(4)(a) are whether the Removal Opponent had an intention in good faith to use the Trade Mark for commercial purposes and whether the Trade Mark was used in good faith for commercial purposes during the Relevant Period. Both Woolly Bull and Liquideng confirm that good faith refers to an intention to use or actual use for genuine commercial purposes, as opposed to some token use. As such, in deciding this matter, I am not able to consider whether use of the Trade Mark by the Removal Opponent is accompanied by a valid claim to proprietorship (which may be absent if the Removal Opponent simply acts as a distributor of goods supplied by another entity, or where some other entity has a better claim to the Trade Mark based on earlier first use in Australia), or whether the Removal Opponent’s filing of the Trade Mark was in bad faith within the meaning of s 62A of the Act. A challenge to the Registration on these grounds would need to be made under s 88 of the Act.

8. As I am satisfied that the Removal Opponent has demonstrated an intention in good faith to use the Trade Mark in relation to the Goods at the Filing Date, and use in good faith of the Trade Mark in relation to the Goods during the Relevant Period, the opposition is established.

   Decision and costs  

9. The Removal Opponent has established grounds of opposition to removal of the Trade Mark. As such, the Trade Mark is to remain registered.

10. The Removal Applicant has the right to appeal this decision. If the Registrar is served with a notice of appeal, the disposition of the Removal Application shall be dealt with by the Court.

11. Both parties sought an award of costs. Normally, costs follow the event. However, under s 221 the Registrar may award costs against any party to the proceedings.

12. I consider that the failure by the Removal Opponent to file sufficient probative evidence at the Evidence in Support stage (notwithstanding that the evidence appeared to be readily available), and the subsequent very late filing by the Removal Opponent of New Evidence, created unnecessary delay and inconvenience for both parties. Further, the Removal Applicant would have had a clear incentive to withdraw the Removal Application at an earlier stage had the information contained in the New Evidence been included in the EIS. The Removal Applicant may also at that point have considered seeking cancellation of the Trade Mark under s 88, rather than incurring delay and cost pursuing the Removal Application.

13. I also consider there is a public interest in deterring parties from the late filing of evidence in response to hearing submissions filed by the other side, where the submissions simply raise criticisms of earlier evidence that could have reasonably been anticipated by legal counsel.

14. In view of the above, and notwithstanding its success in this opposition, I consider that it is appropriate to award costs against the Removal Opponent in accordance with Schedule 8 of the Regulations.

    Blake Knowles

    Hearing Officer

    Delegate of the Registrar of Trade Marks

    4 July 2022