Caporaso Pty Ltd v Mercato Centrale Australia Pty Ltd
[2024] FCA 138
•26 February 2024
FEDERAL COURT OF AUSTRALIA
Caporaso Pty Ltd v Mercato Centrale Australia Pty Ltd [2024] FCA 138
File number: SAD 188 of 2022 Judgment of: CHARLESWORTH J Date of judgment: 26 February 2024 Catchwords: INTELLECTUAL PROPERTY – trade marks – originating application alleging infringement of trade marks including the plain word mark mercato – whether the respondent has used, as a trade mark, a sign that is deceptively similar to any one of the applicant’s trade marks sued upon – cross-claim for cancellation of trade marks or rectification of the Register of Trade Marks in respect of them – whether the cross-respondent was the owner of the trade mark mercato at the time that it applied for registration of it – whether the trade mark mercato is inherently capable of distinguishing the goods and services of the cross-respondent from the goods and services of other traders – whether the word mercato, in its ordinary signification, is commonly understood to mean market among those with an interest in the relevant goods and services – whether other traders should be permitted to use the word in its ordinary signification to describe their goods and services – whether evidence of trade usage of the word supports a conclusion that the word has an established meaning among a target audience comprised of English speaking Australians – whether the registration of a trade mark resulted from representations or evidence that were false in material particulars – meaning of “material particulars” in s 62(b) of the Trade Marks Act 1995 (Cth) – infringement action dismissed – cross-claim allowed in part Legislation: Evidence Act 1995 (Cth) ss 8, 59, 60, 69, 79, 155, 190
Federal Court of Australia Act 1976 (Cth) ss 37M, 37N
Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (Cth)
Trade Marks Act 1955-1958 (Cth) s 26
Trade Marks Act 1995 (Cth) ss 7, 10, 17, 19, 20, 26, 27, 31, 33, 41, 52, 54, 55, 57, 58, 58A, 59, 60, 61, 62, 62A, 88, 89, 120, 206, 207, 210, 219
Cases cited: Accor Australia & New Zealand Hospitality Pty Ltd v Liv Pty Ltd [2017] FCAFC 56; 345 ALR 205
Anakin Pty Ltd v Chatswood BBQ King Pty Ltd [2008] FCA 1467; 250 ALR 620
Anchorage Capital Partners Pty Ltd v ACPA Pty Ltd (2018) 259 FCR 514
Apple Inc v Registrar of Trade Marks (2014) 227 FCR 511
Australian Meat Group Pty Ltd v JBS Australia Pty Ltd (2018) 268 FCR 623
Australian Woollen Mills Ltd v F S Walton & Co Ltd (1937) 58 CLR 641
CA Henschke & Co v Rosemount Estates Pty Ltd [2000] FCA 1539: 52 IPR 42
Cantarella Bros Pty Ltd v Lavazza Australia Pty Ltd (No 3) [2023] FCA 1258
Cantarella Bros Pty Ltd v Modena Trading Pty Ltd (2014) 254 CLR 337
Cantarella Bros Pty Ltd v Modena Trading Pty Ltd [2013] FCA 8; 299 ALR 752
Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511
Coca-Cola Company v All-Fect Distributors Ltd (1999) 96 FCR 107
Coleman Co Inc v Igloo Products Corporation (1999) 48 IPR 158
Colorado Group Ltd v Strandbags Group Pty Ltd (2007) 164 FCR 506
Colorado Group Ltd v Strandbags Group Pty Ltd [2006] FCA 160; 67 IPR 628
Combe International Ltd v Dr August Wolff GmbH & Co KG Arzneimittel [2021] FCAFC 8; 157 IPR 230
Commissioner of Patents v Sherman (2008) 172 FCR 394
Conde Nast Publications Pty Ltd v Taylor [1998] FCA 864; 41 IPR 505
Cooper Engineering Co Pty Ltd v Sigmund Pumps Ltd (1952) 86 CLR 536
Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd [2004] FCAFC 196; 209 ALR 1
Dunlop Aircraft Tyres Ltd v Goodyear Tire and Rubber Company (2018) 262 FCR 76
E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2009) 175 FCR 386
Eastman Photographic Materials Company Limited v Comptroller General of Patents, Designs, and Trade-Marks [1898] AC 571
Energy Beverages LLC v Cantarella Bros Pty Ltd [2023] FCAFC 44; 407 ALR 473
FH Faulding & Co Limited v Imperial Chemical Industries of Australia and New Zealand Limited (1965) 112 CLR 537
Frigiking Trade Mark [1973] RPC 739
Goodman Fielder Pte Ltd v Conga Foods Pty Ltd [2020] FCA 1808; 158 IPR 9
Hashtag Burgers Pty Ltd v In-N-Out Burgers Inc [2020] FCAFC 235; 385 ALR 514
Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216
Howard Auto-Cultivators Ltd v Webb Industries Pty Ltd (1946) 72 CLR 175
Howe Laboratories Inc v Daemar (1999) 36 IPR 638
In re H.N. Brock & Co Limited [1910] 1 Ch 130
In re Joseph Crosfield & Sons, Limited [1910] 1 Ch 130
In the Matter of London Lubricants (1920) Limited’s Application to Register a Trade Mark (1925) 42 RPC 264
Jackson & Company v Napper (1886) 35 Ch D 162
Kiku Trade Mark [1978] FSR 246
Kimberly-Clark Worldwide Inc v Goulimis [2008] FCA 1415; 253 ALR 76
Mark Foy’s Ltd v Davies Coop & Co Ltd (1956) 95 CLR 190
MID Sydney Pty Ltd v Australian Tourism Co Ltd (1998) 90 FCR 236
Modena Trading Pty Ltd v Cantarella Bros Pty Ltd (2013) 215 FCR 16
Mond Staffordshire Refinery Co Ltd v Harlem (1929) 41 CLR 475
New South Wales Dairy Corporation v Murray-Goulburn Co-operative Co Ltd [1989] FCA 124; 86 ALR 549
Nissan Jidosha Kabushiki Kaisha v Woolworths Ltd (1999) 45 IPR 649
NV Sumatra Tobacco Trading Company v British American Tobacco Services Ltd (2011) 198 FCR 435
Optical 88 Ltd v Optical 88 Pty Ltd (No 2) [2010] FCA 1380; 275 ALR 526
PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd (2021) 285 FCR 598
Phillippart v William Whiteley Ltd [1908] 2 Ch 274
Pioneer Hi-Bred Corn Co v Hy-Line Chicks Pty Ltd [1978] 2 NZLR 50
Registrar of Trade Marks v W & G Du Cros Ltd [1913] AC 624
Ritz Hotel Ltd v Charles of the Ritz Ltd (1988) 15 NSWLR 158
Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8; 97 ALJR 388
Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407
SMA Solar Technology AG v Beyond Building Systems Pty Ltd (No 5) [2012] FCA 1483
Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592
Starr Partners Pty Ltd v Dev Prem Pty Ltd [2007] FCAFC 42; 71 IPR 459
Swancom Pty Ltd v The Jazz Corner Hotel Pty Ltd (No 2) [2021] FCA 328; 157 IPR 498
Swancom Pty Ltd v The Jazz Corner Hotel Pty Ltd [2022] FCAFC 157; 407 ALR 93
The Agency Group Australia Limited v H.A.S. Real Estate Pty Ltd [2023] FCA 482 174; IPR 153
The Hoyts Corp Pty Ltd v Hoyt Food Manufacturing Industries Pty Ltd (2003) 61 IPR 334
The Sports Cafe Ltd v The Registrar of Trade Marks [1998] FCA 1614; 42 IPR 552
Wingate Marketing Pty Limited v Levi Strauss & Co (1994) 49 FCR 89
Division: General Division Registry: South Australia National Practice Area: Intellectual Property Sub-area: Trade Marks Number of paragraphs: 318 Date of last submission/s: Applicant: 25 August 2023
Respondent: 15 September 2023Date of hearing: 31 July, 1, 2, 3 and 4 August 2023 Counsel for the Applicant: Mr EJC Heerey KC with Mr AK Baille Solicitor for the Applicant: Piper Alderman Counsel for the Respondents: Mr PJ Bick KC with Mr B Gardiner KC and Mr RJ Maguire Solicitor for the Respondents: Rigby Cooke Lawyers ORDERS
SAD 188 of 2022 BETWEEN: CAPORASO PTY LTD AS TRUSTEE FOR THE DIVERSITY TRUST (ACN 612 176 020)
Applicant
AND: MERCATO CENTRALE AUSTRALIA PTY LTD (ACN 627 469 818)
First Respondent
EDDIE MUTO
Second Respondent
AND BETWEEN: MERCATO CENTRALE AUSTRALIA PTY LTD (ACN 627 469 818)
Cross-Claimant
AND: CAPORASO PTY LTD AS TRUSTEE FOR THE DIVERSITY TRUST (ACN 612 176 020)
Cross-Respondent
ORDER MADE BY:
CHARLESWORTH J
DATE OF ORDER:
26 FEBRUARY 2024
THE COURT ORDERS THAT:
1.The originating application is dismissed.
2.The cross-claim is:
(a)allowed to the extent provided for in paragraph 3 of these orders;
(b)otherwise dismissed.
3.Subject to paragraph 4, in respect of Trade Mark No 1760112, the Register of Trade Marks be amended so that the description of services in Class 43 read as follows:
Services for providing food and drink (other than services relating to the provision of food and drink at cafés, restaurants, bars or hotels); catering services; preparation of takeaway and fast foods; take away food and drink services; bakery services; bakery services relating to cakes and pastries; consultancy services relating to the operation of restaurants, cafes, take away food services, bars and hotels; temporary accommodation.
4.The parties have liberty to apply to vary the order in paragraph 3 so as to reflect the reasons for judgment published today, such liberty to be exercised on or before 4 March 2024.
5.On or before 12 March 2024 any party seeking an order for costs is to file and serve an affidavit specifying the order sought.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
CHARLESWORTH J
The applicant, Caporaso Pty Ltd is the owner of several registered trade marks comprising or incorporating the word mercato. It alleges that the first respondent Mercato Centrale Australia Pty Ltd has infringed and threatens to continue to infringe three of those marks. It seeks declaratory relief, as well as an order permanently restraining Mercato Centrale from engaging in the alleged infringing conduct. A case against the second respondent (Mr Eddie Muto) was not pressed to judgment.
Mercato Centrale denies that it has infringed Caporaso’s marks. By a cross-claim it seeks orders for removal or rectification of the three trade marks forming the subject of the infringement action (and rectifications relating to two further registered trade marks owned by Caporaso).
There are multiple issues in dispute. They are sketched out briefly in the pages that follow, and then resolved in the most convenient order.
In the result I have concluded that Mercato Centrale’s cross-claim should be upheld in part such that one of Caporaso’s trade marks should be removed from the register of trade marks in connection with certain services in Class 43.
The remainder of the cross-claim must be dismissed, as must the infringement action.
THE TRADE MARKS ACT
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: Trade Marks Act 1995 (Cth) (TMA), s 17.
A trade mark may be registered in accordance with the TMA in respect of goods, services, or both: TMA, s 19(1). The Trade Marks Regulations 1995 (Cth) prescribe classes into which goods and services are divided for the purposes of the TMA. The registration of a trade mark may be in respect of goods or services of more than one class: TMA, s 19(2). When a trade mark is registered, its particulars are entered by the Registrar of Trade Marks on a Register kept in accordance with s 207 of the TMA. The Register is prima facie evidence of any particular or other matter entered in it: TMA, s 210.
Subject to Pt 3 of the TMA, if a trade mark is registered, its registered owner has the exclusive right to use it, and to authorise other persons to use it, in relation to the goods and/or services in respect of which it is registered: TMA, s 20(1). The registered owner also has the right to obtain relief under the TMA if the trade mark has been infringed: TMA, s 20(2).
Part 4 of the TMA prescribes how applications for registration of trade marks are to be made and decided. An application for registration may be made under s 27 of the TMA by a person claiming to be its owner. The Registrar must examine the application and report on whether the application has been made in accordance with the TMA and whether there are grounds under the TMA for rejecting it: TMA, s 31. After the examination, the Registrar must accept the application unless satisfied that it has not been made in accordance with the TMA or if there are grounds under the TMA for rejecting it (in which case it must be rejected): TMA, s 33(1), s 33(3). An application may be accepted subject to conditions or limitations: TMA, s 33(2).
Division 2 of Pt 4 of the TMA sets out the grounds on which an application to register a trade mark may be rejected. It contains s 41, as amended by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (Cth). The amendment came into effect on 14 April 2013, after registration of one of the trade marks in issue in these proceedings, and before registration of another of them. As Burley J explained in Goodman Fielder Pte Ltd v Conga Foods Pty Ltd [2020] FCA 1808; 158 IPR 9 (at [209]), a purpose of the amendments was to clarify that the presumption of registrability in s 33 applies equally to s 41. His Honour said that whilst the wording was different, the practical operation of the new provision was similar to the old, and authorities dealing with s 41 prior to the amendments remain appliable today. In these proceedings neither party contended that the difference in wording should result in differing outcomes as between one trade mark or another. I will therefore proceed by reference to s 41.
Section 41(1) provides that an application for the registration of a trade mark must be rejected if it is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered from the goods or services of other persons. 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 s 41(3) or s 41(4) applies: TMA, s 41(2). They provide:
(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.
For the purposes of those provisions, the use of a trade mark by a predecessor in title of an applicant for the registration of a trade mark is taken to be use of the trade mark by the applicant: TMA, s 41(5).
Part 5 of the TMA establishes a regime for registration of trade marks to be opposed. Registration may be opposed on any of the grounds specified in the TMA, but on no other grounds: TMA, s 52(4). If the Registrar has accepted an application for the registration of a trade mark, a person may oppose the registration by filing a notice of opposition. If such a notice is filed, the Registrar must conduct a proceeding for dealing with the opposition and, at the end, must decide either to refuse to register the trade mark or to register the trade mark (with or without conditions or limitations), depending on the extent to which the grounds of opposition have been established: TMA, s 54, s 55.
The grounds for opposing registration are prescribed in ss 57 to 62A. They include opposition on any of the grounds on which an application for registration of a trade mark may be rejected (other than on the ground that the trade mark cannot be represented graphically). They also include the ground that the applicant is not the owner of the trade mark (TMA, s 58) and the ground that the Registrar accepted the application for registration on the basis of evidence or representations that were false in material particulars (TMA, s 62(b)).
Subject to exceptions that do not presently apply, the registration of a trade mark in respect of the goods and or services in respect of which it is registered is taken to have had effect from (and including) the filing date in respect of the application for registration, referred to as the priority date.
A registration may be amended, cancelled or revoked in accordance with Pt 8 of the TMA, including by orders of this Court. Relevantly, the Court may, on the application of an “aggrieved person” or the Registrar, order that the Register be rectified by cancelling the registration of a trade mark, removing or amending any entry in the Register relating to it, or entering any condition or limitation affecting its registration: TMA, s 88. An application under s 88 may be made on (and only on) the grounds specified in s 88(2). They relevantly include “any of the grounds on which registration of the trade mark could have been opposed under this Act”: TMA, s 88(2)(a).
Part 12 of the TMA deals with infringement of trade marks. Section 120 relevantly provides:
(1)A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered.
Note 1: For registered trade mark see section 6.
Note 2: For deceptively similar see section 10.
Note 3:In addition, the regulations may provide for the effect of a protected international trade mark: see Part 17A.
(2)A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to:
(a)goods of the same description as that of goods (registered goods) in respect of which the trade mark is registered; or
(b)services that are closely related to registered goods; or
(c)services of the same description as that of services (registered services) in respect of which the trade mark is registered; or
(d)goods that are closely related to registered services.
However, the person is not taken to have infringed the trade mark if the person establishes that using the sign as the person did is not likely to deceive or cause confusion.
Note 1: For registered trade mark see section 6.
Note 2: For deceptively similar see section 10.
Note 3:In addition, the regulations may provide for the effect of a protected international trade mark: see Part 17A.
The relief that may be granted by the Court on an infringement action includes an injunction, which may be granted subject to any condition that the Court thinks fit: TMA, s 26.
THE INFRINGEMENT ACTION
Caporaso sues in its capacity as trustee of the Diversity Trust. In that capacity it sues for infringement of three registered trade marks.
The first mark sued upon is Trade Mark No 1760112, being the plain word mercato. I will refer to it as the Plain Word Mark. It has a priority date of 21 March 2016 and relevantly carries the following endorsements:
Evidence and/or other circumstances provided under subsection 41(4).
...
The applicant has advised that a translation of the Italian word MERCATO appearing in the trade mark is MARKET.
The Plain Word Mark is registered in respect of the following goods and services in Classes 29, 30, 35 and 43:
Class 29:
Meat, fish, poultry and game; meat extracts; preserved, dried and cooked fruits and vegetables; jellies, jams, compotes; eggs; milk and milk products; edible oils and fats including olive oil
Class 30:
Coffee, tea, cocoa and artificial coffee; rice; tapioca and sago; flour and preparations made from cereals; biscuits and biscuit products; bread, pastry and confectionery; edible ices; sugar, honey, treacle; yeast, baking-powder; salt; mustard; vinegar, sauces including pasta sauces; spices; ice
Class 35:
Retail and wholesale services; retailing and wholesaling of goods (by any means); supermarket retailing; discount services (retail, wholesale, or sales promotion services); distribution of goods (not being transport services) (agent, wholesale, representative services, by any means); administration of the business affairs of franchises; business advisory services relating to the establishment of franchises; business advisory services relating to the operation of franchises; business assistance relating to the establishment of franchises; advertising; advisory services relating to advertising; business advertising services, relating to franchising; business consultation relating to advertising; consultancy relating to advertising; outdoor advertising; placing of advertisements; planning services for advertising; preparing of advertisements; provision of advertising spaces; business advisory services relating to the management of businesses; business management; business organisation and management of discount services
Class 43:
Services for providing food and drink including services relating to the provision of food and drink at cafes, restaurants, bars, hotels and provision of catering services; preparation of take away and fast foods; take away food and drink services; bakery services; bakery services relating to cakes and pastries; consultancy services relating to the operation of restaurants, cafes, take away food services, bars and hotels; temporary accommodation
The second mark sued upon is Trade Mark No 1255041, having the priority date 4 August 2008. It will be referred to as the Fancy Word Mark. It appears as follows:
The Fancy Word Mark has the endorsement “The applicant has advised that a translation of the ITALIAN word MERCATO appearing in the trade mark is MARKET”. It is registered in respect of the following services in Class 35:
Class 35:
Administration of the business affairs of franchises; business advisory services relating to the establishment of franchises; business advisory services relating to the operation of franchises; business assistance relating to the establishment of franchises; advertising; advisory services relating to advertising; business advertising services relating to franchising; business consultation relating to advertising; consultancy relating to advertising; outdoor advertising; placing of advertisements; planning services for advertising; preparing of advertisements; provision of advertising spaces; business advisory services relating to the management of businesses; business management; business organisation and management of discount services; retail services; retailing of goods (by any means); supermarket retailing; discount services (retail, wholesale, or sales promotion services); distribution of goods (not being transport services) (agent, wholesale, representative services, by any means)
The third is mark sued upon is Trade Mark No 1299144, having the priority date 14 May 2009. It will be referred to as the Red Man Logo and appears as follows:
The Red Man Logo is registered in respect of the following services in Class 43:
Class 43:
Bakery services; cake and pastry services; services for providing food and drink including services relating to the provision of food and drink at cafes, restaurants, bars, hotels and provision of catering services; preparation of take away and fast foods; take away food and drink services; consultancy services relating to the operation of restaurants, cafes, take away food services, bars and hotels; temporary accommodation
The three marks sued upon may be referred to together as the Caporaso Marks.
In its Further Amended Statement of Claim (FASC) dated 4 August 2023, Caporaso alleges that it is the operator of a successful Italian themed supermarket, restaurant and wine retail business. The business is alleged to have been operated by Caporaso and its “predecessors in business” since 1972 and that it has “traded by reference to” the trade mark mercato from at least 2005, initially from premises situated in the Adelaide suburb of Rostrevor and then (and currently) from premises situated in the Adelaide suburb of Campbelltown. Particulars of the business are given as follows:
5.1The Applicant’s business was first established in in 1972 by its predecessors in title, Mario & Imma Caporaso, and traded under the name ‘Imma & Mario’s Continental’ or ‘Imma & Mario’s Continental Store’;
5.2On 8 February 1999, Giovanni ‘John’ Caporaso and Rosalba ‘Rose’ Caporaso purchased the business trading as ‘Imma & Mario’s Continental’, including goodwill, from Mario and Imma Caporaso;
5.3From 2005, the Applicant and its predecessors in title ceased using the trade marks ‘Imma & Mario’s Continental’ or ‘Imma & Mario’s Continental Store’;
5.4From 2005, the Applicant and its predecessors in title have promoted, offered for sale and sold the goods and services of the Applicant’s business predominantly under or by reference to the trade marks ‘Imma & Mario’s Mercato’;
5.5From 2011
09, the Applicant and its predecessors in title have promoted, offered for sale and sold the goods and services of the Applicant’s business predominantly under or by reference to the trade mark ‘Mercato’ (or by reference to logo marks incorporating that word mark);5.6At all times from 2005, the predominant word used by the Applicant and its predecessors in title in its unregistered and registered trade marks has been the word ‘Mercato’.
In addition, Caporaso alleges that it has, since about March 2018, operated an online food and beverage delivery service at the internet address and related social media accounts.
Caporaso alleges that Mercato Centrale has infringed the Caporaso Marks by promoting and offering for sale goods and services by reference to three trade marks namely:
(1)the words MERCATO CENTRALE;
(2)the words IL MERCATO CENTRALE; and
(3)a logo featuring the words IL MERCATO CENTRALE (Mercato Centrale Logo) as follows:
I will refer to them together as the Mercato Centrale Marks.
It is not disputed that Mercato Centrale applied to register each of the Mercato Centrale Marks in respect of Classes 35 and 45 including the following services:
(Class 35) wine shop services; retail services; retail services for goods (by any means); retail services relating to bakery products; supermarket retailing; retail sale of prepared meat and meat products (butcher’s shop); business advertising services relating to franchising; business franchising services (group purchasing, group advertising);
(Class 43) restaurant services, restaurant services for the provision of fast food; restaurants; salad bar restaurant services; self-service restaurants; take-away restaurant services.
They are trade mark applications numbered TMA2272358, TMA2272266 and TMA2199554 respectively. The first two of those applications were subsequently withdrawn. Registration of the Mercato Centrale Logo was filed on 3 August 2021 and is currently opposed by Caporaso.
Caporaso alleges that by pleaded conduct (much of which is admitted), Mercato Centrale has, within the meaning of s 120(1) of the TMA, used and continues to use as a trade mark a sign which is substantially identical or deceptively similar to one or more of the Caporaso Marks in relation to same goods and services for which they are registered.
Alternatively, it alleges that Mercato Centrale has, within the meaning of s 120(2) of the TMA, used and continues to use as a trade mark a sign which is substantially identical or deceptively similar to one or more of the Caporaso Marks in relation to:
(1)goods and services of the same description as that of goods and services in respect of which the Caporaso Marks are registered; or
(2)services that are closely related to the registered goods.
By its Further Amended Statement of Cross-Claim (FASCC) filed 4 August 2023, Mercato Centrale acknowledges that it intends to use and has to some extent already used each of the Mercato Centrale Marks in respect of goods and services for which registration of the Mercato Centrale Logo is sought, including by establishing and maintaining a website at In addition, newspapers and editorials have reported on and written about the proposed opening of a business trading as Il Mercato Centrale from premises situated on Collins Street in Melbourne. It is Mercato Centrale’s intention to provide food and beverage retail services from those premises. It denies that its current and intended conduct infringes any one of the Caporaso Marks.
In light of the cross-claim, Caporaso presses the allegation of infringement with respect to the Fancy Word Mark and the Red Man Logo only in the event that any part of (respectively) Class 35 or Class 43 of the Plain Word Mark is cancelled.
THE CROSS-CLAIM
The FASCC broadly raises five questions. It is convenient to name them in shorthand as relating to Distinctiveness, Confusion, Ownership, Misrepresentation and Limitation.
The Distinctiveness question is whether the Plain Word Mark and the Fancy Word Mark should be cancelled or rectified under s 41 of the TMA because they are merely descriptive of Caporaso’s designated goods and services and therefore not (or not sufficiently) inherently adapted to distinguish those goods and services from the goods and services of other traders.
Mercato Centrale contends that the only or dominant word in each of the Plain Word Mark and the Fancy Word Mark is the word mercato, being an Italian word meaning “market” or “marketplace”. It alleges that (as at the priority dates) the word carried that same ordinary signification in Australia to English speaking persons concerned with the goods or services for which the marks are registered “especially a market selling fresh food and ready-prepared meals in the style commonly associated with Italy”. It contends that the word mercato is directly descriptive of those goods and services, and is therefore a word that other honest traders might legitimately need or desire to use to describe goods and services of the same character.
The cross-claim under s 41 is limited to defined parts of the goods and services descriptions referred to as the Challenged Goods and Services. It is alleged that the ordinary signification of the word mercato is a direct reference to a market “being a place where goods in the nature of the Challenged Goods and Services are typically offered for sale and sold and/or where services in the nature of the Challenged Goods and Services are offered or provided”.
The FASCC contains allegations that the Italian language is (and was at the relevant priority dates) widely spoken in Australia, and that more than one million Australians claim to have Italian ancestry. However, at trial, those factual allegations were not actively pressed as a basis for cancellation or rectification. Rather, it is alleged that the word mercato, whilst having Italian origins, had come to be recognised by ordinary Australian consumers having acquired a familiar meaning, to English speakers, as ensconced and plainly descriptive as the words spaghetti or cappuccino have become.
The Confusion question is whether registration of the Plain Word Mark and the Fancy Word Mark should be cancelled under s 88(2)(c) in respect of some classes of goods and services because, in the circumstances existing at the time that Mercato Centrale commenced the cross-claim, use of those marks in those classes is likely to deceive or cause confusion. This aspect of the cross-claim hinges on a submission that, even if the Plain Word Mark and Fancy Word Mark were inherently adapted to distinguish the relevant goods and services of Caporaso as at their priority dates, as at 31 May 2023 the word mercato had come to bear an ordinary signification in the target audience of English speaking Australians to mean market or marketplace. Accordingly, it is said, use of the word as a trade mark is likely to cause confusion in the minds of consumers.
The Ownership question is whether registration of the Plain Word Mark should be cancelled because at its priority date Caporaso was not the owner of the mark mercato. Mercato Centrale alleges that the word mercato (alone) and the mark MERCATO @ daylesford were each used by the operators of a restaurant business in Daylesford in 2004. It alleges that the words were used in respect of goods and services being “the same kind of thing” as the services for which the Plain Word Mark is registered in Class 43 (with the exception of temporary accommodation services).
The Misrepresentation question is whether registration of the Plain Word Mark should be cancelled on the basis that it was accepted for registration on the basis of evidence and representations that were materially false within the meaning of s 62(b) of the TMA.
Mercato Centrale alleges that registration of the Plain Word Mark was secured on the basis of a statutory declaration of a representative of Caporaso, containing the following misrepresentations about the prior use of the word mercato as a trade mark in the conduct of Caporaso’s business:
(a)the trade mark applicants’ business commenced operation ‘in 1972 under the name Imma and Mario’s Mercato’ when, in fact, the business did not include the word ‘Mercato’ in its trading name until at least 2005; and
(b)‘The MERCATO brand has been used in connection with my family business and in particular retail and wholesale services since the early 70’s’ when that is not the case; and
(c)The applicants’ business ‘has been known solely by the Trade Mark MERCATO for over a decade’ when that was not the case; and
(d)‘the store and business began to be referred to as simply MERCATO’ in June 2005 when in fact, the business was not known or promoted as simply MERCATO until, at the earliest, 2009.
The Limitation question is whether, if any of the challenged marks are permitted to remain on the Register, they (together with two other logos) should be subject to the limitation that “registration does not confer any exclusive right to use the word MERCATO”. The limitation is sought in the event that the Court finds in favour of Mercato Centrale on the Misrepresentation question.
Defence to the cross-claim
Caporaso joins issue with the allegations in the FASCC, save for admitting certain misrepresentations. It alleges that if any one of its trade marks is to be subject to a limitation of the kind sought by Mercato Centrale, then it must follow that an equivalent limitation must apply in connection with the word mark Mercato Centrale. It contends that if any grounds for rectification were to be established, the Court should exercise its discretion under s 88 of the TMA to refuse to grant relief, including because Caporaso would have established registration of the relevant Caporaso trade marks on dates after their respective priority dates but before Mercato Centrale’s first use of its own marks or the date of filing of its own trade mark applications. Registration would have been obtained, Caporaso contends, by reason of its use or intended use (or that of its predecessors in business) of the relevant Caporaso trade marks before and after the priority dates for each of those marks.
It is convenient to resolve the issues arising on the cross-claim before turning to the infringement action.
DISTINCTIVENESS AND CONFUSION
These two aspects of the cross-claim may be dealt with together. Each of them require an enquiry into a similar question: whether the word mercato had an ordinary signification at the relevant time, specifically that it was commonly understood at those times to describe a market or marketplace.
The challenge under s 41 of the TMA is confined to the Plain Word Mark and the Fancy Word Mark in respect of what is described as the “Challenged Goods and Services (Word Marks)” specified in [11(a)] of the FASCC. They are:
(1)In respect of the Fancy Word Mark (priority date 4 August 2008):
Class 35: … business organisation and management of discount services; discount services (retail, wholesale, or sales promotion services); retail services; distribution of goods (not being transport services) (agent, wholesale, representative services, by any means); retailing of goods (by any means)
(2)In respect of the Plain Word Mark (priority date 21 March 2016):
Class 29: Meat, fish, poultry and game; meat extracts; preserved, dried and cooked fruits and vegetables; jellies, jams, compotes; eggs; milk and milk products; edible oils and fats including olive oil
Class 30: Coffee, tea, cocoa and artificial coffee; rice; tapioca and sago; flour and preparations made from cereals; biscuits and biscuit products; bread, pastry and confectionery; edible ices; sugar, honey, treacle; yeast, baking-powder; salt; mustard; vinegar, sauces including pasta sauces; spices; ice
Class 35: Retail and wholesale services; retailing and wholesaling of goods (by any means); supermarket retailing; discount services(retail, wholesale, or sales promotion services); distribution of goods (not being transport services) (agent, wholesale, representative services, by any means); …
Class 43: Services for providing food and drink including services relating to the provision of food and drink at cafes, restaurants, bars, hotels and provision of catering services; preparation of take away and fast foods; take away food and drink services; bakery services; bakery services relating to cakes and pastries; consultancy services relating to the operation of restaurants, cafes, take away food services, bars and hotels; temporary accommodation
That challenge turns on the ordinary signification (if any) of the word mercato as at the priority dates for the trade marks.
The challenge under s 88(c) also relates to the same marks, goods and services, but turns on the ordinary signification of the word mercato at the time that the cross-claim was commenced.
Distinctiveness principles
Section 41(3) and s 41(4) identify the only two ways in which a trade mark may be taken not to be capable of distinguishing the designated goods and services of the trade mark applicant from the goods and services of other persons. Section 41(3) has two necessary elements. The first is that 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: TMA, s 41(3)(a). The second is that the registration applicant has not used the trade mark before the filing date to such an extent that the trade mark does in fact distinguish the designated goods or services as being those of the applicant. Section 41(4) is concerned with trade marks that are “to some extent, but not sufficiently, inherently adapted to distinguish” the designated goods or services from those of other persons: TMA, s 41(4)(a). In such cases, registrability will depend upon the extent to which it is so capable, together with the combined effect of the matters referred to in s 41(4)(b). They include the use or intended us, of the trade mark, by the applicant and “any other circumstances”.
In each instance, the initial focus is on the extent (if any) to which the mark is inherently adapted to distinguish, considered apart from the applicant’s use or intended use of it. The present inquiry focuses on whether the word mercato in the Plain Word Mark and the Fancy Word Mark is merely descriptive of some of the goods and services in respect of which they are registered. Where a trade mark is comprised solely of a word that is, or describes, the goods or services in respect of which it is sought to be registered, it is liable to be successfully opposed for failure to accord with the requirements of s 41. As Stephen J said in Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216 (at 229), “there is a price to be paid for the advantages flowing from the possession of an eloquently descriptive trade name”. His Honour explained (at 229):
… Because it is descriptive it is equally applicable to any business of a like kind, its very descriptiveness ensures that it is not distinctive of any particular business and hence its application to other like businesses will not ordinarily mislead the public. In cases of passing off, where it is the wrongful appropriation of the reputation of another or that of his goods that is in question, a plaintiff which uses descriptive words in its trade name will find that quite small differences in a competitor’s trade name will render the latter immune from action …
(footnote omitted)
In FH Faulding & Co Limited v Imperial Chemical Industries of Australia and New Zealand Limited (1965) 112 CLR 537, the appellant was the registered owner of the trade mark barrier in respect of chemical substances for use in medicine and pharmacy, which encompassed hand creams. Its infringement action against the respondent was met with a cross-claim for removal of the trade mark or the insertion of a limitation. McTiernan J at first instance allowed the cross-claim and inserted the limitation “other than skin protective creams”. On appeal, Kitto J held that the word barrier was not inherently adapted to distinguish the goods of the trade mark owner from those of other persons within the meaning of s 26(2)(a) of the Trade Marks Act 1955-1958 (Cth) as then in force because it was descriptive of a whole class of goods of which the appellant’s goods were but examples. His Honour said (at 555):
… That this is the case with Barrier as applied to skin protective creams is put beyond doubt by the evidence in this case. But for the evidence, it might have been said that the word, though inherently suited to be used adjectivally for the purpose of referring to the distinguishing characteristic of skin protective creams generally, is not one which would spring instantly to the mind of a person who wanted a word for the purpose but had never known Barrier to be so employed. This might have been said with the general principle in mind that the question to be asked in order to test whether a word is adapted to distinguish one trader’s goods from the goods of all others is whether the word is one which other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use upon or in connexion with their goods: Registrar of Trade Marks v. W. & G. Du Cros Ltd.; Eclipse Sleep Products Inc. v. The Registrar of Trade Marks; Clark Equipment Co. v. Registrar of Trade Marks. But the evidence shows clearly, and it satisfied the learned primary Judge, that Barrier has long appealed to persons in industry, in pharmacy and in allied occupations as meeting their need for a word to describe succinctly and yet exactly the essential characteristic of protection which distinguishes the whole of the relevant class of creams. …
(footnotes omitted)
His Honour went on to say (at 556 – 557):
… at least by the year of the initial registration of the appellant’s trade mark (1943) the word Barrier had caught on as a word peculiarly apt, according to its ordinary signification, for descriptive use in connexion with skin protective creams, so that any trader in such creams would be very likely indeed, in the ordinary course of business and without any improper motive, to desire to use the word in order to distinguish such creams in general from creams intended for other purposes. We have not to inquire, on this aspect of the case, whether or not the respondent began its use of the word with a view to appropriating to itself some of the goodwill which the appellant had built up for its own product. What matters is that at all material times the word has had such a place in the vocabulary of persons concerned with skin protective creams that according to the principle which must be applied under the Trade Marks Acts the appellant cannot be allowed a monopoly of its use in connexion with such creams.
A year earlier, in Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511, Kitto J (citing Lord Parker in Registrar of Trade Marks v W & G Du Cros Ltd [1913] AC 624) referred to the natural disinclination of the Legislature and the Courts to allow any person to obtain by a trade mark registration “a monopoly in what others may legitimately desire to use”. His Honour continued (at 514):
… The interests of strangers and of the public are thus bound up with the whole question, as Hamilton L.J. pointed out in the case of R. J. Lea, Ltd.; but to say this is not to treat the question as depending upon some vague notion of public policy: it is to insist that the question whether a mark is adapted to distinguish 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, that is to say, 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 they ordinarily possess – will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it.
(footnotes omitted, emphasis added)
The application of those principles to trade marks comprising or containing “foreign” words is best illustrated by examining a case commenced in this Court in 2011 relating to trade marks for coffee products. The applicant, Cantarella Bros Pty Ltd brought proceedings against the respondent Modena Trading Pty Ltd alleging infringement of two trade marks registered in connection with goods including coffee products: oro (an Italian word for gold or golden) and cinque stelle (an Italian expression for five stars). It was not disputed that Modena had used and was continuing to use both marks on packaging and in connection with its marketing of coffee products in Australia, although use of the words as a trade mark was denied. By its cross-claim Modena sought orders under s 88 of the TMA for removal of the two marks from the Register on the grounds that they were not inherently adapted to distinguish, and did not in fact distinguish, Cantarella’s goods from the goods of other persons. At first instance, Emmett J allowed Cantarella’s claim in part and dismissed Modena’s cross-claim: Cantarella Bros Pty Ltd v Modena Trading Pty Ltd [2013] FCA 8; 299 ALR 752 (Cantarella First Instance). The Full Court set aside Emmett J’s orders: Modena Trading Pty Ltd v Cantarella Bros Pty Ltd (2013) 215 FCR 16 (Cantarella Full Court). The High Court set aside the judgment of the Full Court, identifying no error in that part of Emmett J’s reasons with which the Full Court dealt: Cantarella Bros Pty Ltd v Modena Trading Pty Ltd (2014) 254 CLR 337 (Cantarella High Court). In the present case the parties are in dispute about the principles to be extracted from the judgment of the High Court and is therefore necessary to examine the judgment in some detail.
In Cantarella First Instance, Emmett J observed that neither the word oro nor the word stelle appeared in English dictionaries. His Honour referred to evidence of the frequent use of the word oro in Australia in connection with coffee products, often in the phrase oro qualita. For Modena it was submitted that the phrase described the character and quality of the goods such that they were not distinctive. Modena submitted that the English translation of the trade marks (respectively), gold and five stars, would not be capable of distinguishing the goods of Cantarella from the goods of other persons, that there were many people in Australia who understood the English meaning of the Italian words oro and cinque stelle and that, accordingly, the Italian words were not capable of distinguishing Cantarella’s goods. It submitted that if an objection can be made to the registration of an English word, then the same objection could be made to a foreign language word having the same meaning. It submitted that the words oro and cinque stelle were laudatory terms and therefore descriptive, rather than indicating a connection in the course of trade between Cantarella and the designated products. It further submitted that the evidence of extensive use of the word oro in the relevant trade indicated that it was not inherently adapted to distinguish, and that the trade marks were words that other traders might, without improper motive, want to use as “varietal indicators” of their own Italian style coffee products. Accordingly, it submitted, it should be free to use the words gold and five stars and the Italian translations of those words in connection with its own products.
Emmett J said that he would be disposed to accept the submission that the English words gold and five stars would not be distinctive and therefore could not have been registered by Cantarella at the relevant filing dates. However, his Honour said, that was not the question. The question was whether the marks oro and cinque stelle were validly registered. His Honour continued:
112The adoption of a three-step test has been suggested in relation to marks consisting of words in a foreign language. First, it is necessary to determine whether the foreign language is well known in Australia. Second, it is necessary to determine whether the translation provided is the most common meaning attributed to the word. Finally, it is necessary to determine whether that common meaning has an inherent capacity to distinguish, applying the tests required by s 41 (see Cantarella Bros Pty Ltd v Sunbeam Corporation Ltd [2007] ATMO 3 at [21]).
113Such a test may be a useful approach. However, I am by no means persuaded that it is necessarily the only approach. Some words in foreign languages may be well-known in Australia, even if the language itself is not well known. On the other hand, the mere fact that a language is well-known in Australia does not mean that every word in that foreign language should be taken to be well-known in Australia. Even if a particular language may be understood by many Australians, it does not follow that all words in that language would be understood by all English-speaking persons in Australia who have some familiarity with the foreign language. I consider that the question is whether the particular words that are intended to constitute the trade mark are sufficiently well understood in Australia. That does not depend upon whether a particular language is well-known in Australia. Specifically, the question is not whether Italian is understood by many persons in Australia, but whether Cinque Stelle and Oro are commonly understood in Australia as meaning five stars and gold respectively.
Justice Emmett went on to consider census data identifying the number of people living in Australia who identified themselves as having been born in Italy or having Italian ancestry or who spoke Italian at home. His Honour said that it may be clear enough to Italian speakers that oro and cinque stelle signified gold and five stars. However, neither of the marks meant anything in English. Whilst educated English speakers with some knowledge of Romance languages or Latin may be able to deduce their meanings, their allusions would be known to only a very small minority of English speaking people. His Honour was not satisfied that the words would be generally understood in Australia as bearing their translated meanings. Accordingly, both cinque stelle and oro were sufficiently inherently adapted to distinguish Cantarella’s goods from those of other persons because “the Italian words are not so obvious to ordinary English speaking persons in Australia that Cinque Stelle and Oro have a specific meaning” (at [118]).
Modena appealed to the Full Court. In their joint judgment, Mansfield, Jacobson and Gilmour JJ discussed the statements of Kitto J in FH Faulding and Clark Equipment, concluding that the parentheses statement in the latter case (emphasised in the passage extracted at [75] below) should be understood to have been maintained and applied in FH Faulding (notwithstanding its absence in the reasons from judgment) and so could not be ignored as surplusage (at [62] – [68]). The Full Court emphasised that the parenthetical explanation in Clark Equipment was not to be applied as though it were a statute, and that phrases such as “common right of the public” and “words forming part of the common heritage” were broad expressions having a content and application that may vary according to the facts and circumstances of a particular case. The Full Court said that the enquiry under s 41(2) and s 41(3) was “directed at least to traders with goods and services of the relevant kind and the likelihood, in a case such as this, of their thinking of and wanting to use the word(s) in question”. The enquiry may also have regard to the knowledge and practices of consumers as a relevant consideration informing the likely actions of traders but, the Full Court said, it will not necessarily be the focus of the enquiry (at [74]). The Full Court observed that in both Clark Equipment and FH Faulding the focus was not on the knowledge of the general public as potential consumers of the relevant products or otherwise, and that the majority of cases focussed instead on the knowledge and practice within the relevant trade. To posit whether the Italian words were commonly or generally understood in Australia by ordinary English persons as meaning gold and five stars was, the Full Court said, to adopt an approach that was not appropriate in a case where “common Italian words descriptive of quality, are in issue”. The Full Court said that there was no necessity to approach the enquiry from an Anglocentric perspective given the rich cultural and ethnic diversities in the population (at [85]) and that, as distinctiveness was a question of fact, the enquiry may involve contextual considerations. It was unnecessary, the Full Court said, that consumers know what the words mean in English, although the evidence showed that many people in Australia would in fact know what they meant, and that Italian speakers would understand the words “as common Italian laudatory and therefore descriptive words” (at [88]). The Full Court proceeded to identify a number of factual matters bearing on the enquiry, including evidence of the number of traders in coffee products in fact using the words to describe their quality, including use preceding Cantarella’s application to register the words as trade marks. In light of those contextual considerations and the focus on the actual and desired use of honest traders, the Full Court concluded that the words oro and cinque stelle were not inherently adapted to distinguish the designated goods from those of other traders in those goods.
The High Court held that approach was erroneous. The majority (French CJ, Hayne, Crennan and Kiefel JJ) traced the development of trade mark law in the United Kingdom particularly with respect to descriptive words over which no monopoly should be granted, such as geographic locations, initials, surnames, laudatory epithets used as adjectives, or words directly referring to the relevant goods. That jurisprudence grew out of s 6 and s 16 the Trade Marks Act 1905 (UK) (1905 Act) and cognate provisions in the Trade Marks Act 1955 (Cth) (1955 Act) (including s 24). As the majority observed, s 9(5) of the 1905 Act provided that marks (other than those falling within exceptions) were deemed to be distinctive, provided that they were “adapted to distinguish”).
Section 16(1) of the 1905 Act relevantly provided that to be registered a mark must consist of:
(c)an invented word or words;
(d)A word or words having no direct reference to the character or quality of the goods and not being according to its ordinary signification a geographical name or surname.
(e)Any other distinctive mark [other than those which fell within the preceding paragraphs, if deemed distinctive by the Registrar, Law Officer or court].
The word “distinctive” was defined in s 16(2) to mean “adapted to distinguish the goods of the proprietor of the trade mark from those of other persons”. As the majority said, enquiries about the meaning of a word (and hence its ordinary signification) were conducted on the basis that Australia is an English speaking nation. The majority explained that the early cases coming before the Court of Appeal recognised that the word “direct” in s 16(1)(d) of the 1905 Act was intended to permit entry onto the Register marks that constituted or contained a “skilful, covert or allusive reference to goods” (citing In re Joseph Crosfield & Sons, Limited [1910] 1 Ch 130 (Perfection)). In Eastman Photographic Materials Company Limited v Comptroller General of Patents, Designs, and Trade-Marks [1898] AC 571 (Solio) it was established that no monopoly could be granted under s 9(5) of the 1905 Act for laudatory epithets used as adjectives, such as “good” or “best”. In Perfection it was held that the word “perfection” could not be registered as a trade mark for soap because it was a word that should be open to use by other soap traders: Perfection, Fletcher Moulton LJ (at [144], [150], [151], [154]). Nor could a monopoly be granted in a word that was merely a phonetic equivalent of a directly descriptive word: In re H.N. Brock & Co Limited [1910] 1 Ch 130.
In the cases discussed by the majority, determination of whether a word had a direct reference to goods (such that a monopoly over its use should be precluded), it was critical to consider the goods themselves, because a word containing a direct reference to goods in one trade may not convey any such direct reference to goods in another (at [39]).
The majority in Cantarella High Court summarised (at [40]):
It was thus established early in the development of trade mark law in the United Kingdom that the ‘ordinary signification’ of any word, or words, constituting a trade mark is important, whether a challenge to the registrability of a trade mark is based on the word having a laudatory or directly descriptive meaning, or on the word being, according to its ‘ordinary signification’, a geographical name (or, in those times, a surname).
Their Honours went on to discuss Lord Parker’s statement in Du Cros, in which his Lordship considered whether two registration applications for marks consisting of letters of the alphabet joined with an ampersand were “adapted to distinguish” under s 9(5) of the 1905 Act. His Lordship explained that a trader should not be given a monopoly of letters that other traders may legitimately desire to use because they have the same initials. It was in that context that his Lordship made the statement cited by Kitto J in Clark Equipment, namely that registrability of a mark would “largely depend upon whether other traders are likely, in the ordinary course of their business and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connection with their own goods”: Du Cros at 635. As the majority explained, the United Kingdom cases showed that for at least a century, proposed trade marks had been examined both from the perspective of the impairment of honest traders to do what would be their natural mode of conducting their businesses (apart from the grant of a monopoly) and from the wider point of view of the public. In addition, the decisions showed that in assessing the distinctiveness of a word it was necessary to have regard to the word’s ordinary signification.
Against that background, the majority went on to discuss early cases involving “foreign” words, historically assessed under the test for whether a word could qualify as “invented” for the purpose of s 16 of the 1905 Act. In Phillippart v William Whiteley Ltd [1908] 2 Ch 274, the word diabolo was unregistrable because it was the name of a well known game in England. In Solio, there was opposition to the registration of the mark solio for photographic papers because it was said to be an Italian or Latin word (and therefore not invented) and a word that contained a reference to the goods. Lord Macnaghten said that an invented word could be one that could be traced to a foreign source, and it was not necessary to show that it should be wholly meaningless. Nor could there be objection to it on the basis that it contained a skilful allusion to the character or quality of the goods. In Australia, Solio was cited by Dixon J in Howard Auto-Cultivators Ltd v Webb Industries Pty Ltd (1946) 72 CLR 175. His Honour added that the word should be “substantially different from any word in ordinary and common use” (at 181). Similarly, in Kiku Trade Mark [1978] FSR 246, the Supreme Court of Ireland concluded that a word that required translation could not be one having any signification to ordinary people living in Ireland who saw or heard it. In that case, the word Kiku (Japanese for chrysanthemum) was registrable because it contained no direct reference to the character or quality of the goods.
As the majority in Cantarella High Court observed (at [48]), those authorities:
… show that it is not the meaning of a foreign word as translated which is critical, although it might be relevant. What is critical is the meaning conveyed by a foreign word to those who will be concerned with the relevant goods.
Their Honours said that resolution of the appeal turned on the practical distinction between a word that made some covert or skilful allusion to the goods on the one hand, and words having a direct reference to them on the other. The former would be prima facie registrable, the latter would not (at [50]). The difference, their Honours said, was illustrated by two Australian cases decided under the 1905 Act: Howard and Mark Foy’s Ltd v Davies Coop & Co Ltd (1956) 95 CLR 190.
In Howard, Dixon J concluded that the word rohoe would be understood by a farmer, horticulturalist, a trader in horticultural implements or a person otherwise concerned with them to be an obvious contraction of “rotary hoe”, given the special nature of the cultivating implements to which the trade mark was to be applied.
Mark Foy’s concerned the registrability of the words tub happy as a trade mark for cotton garments. Dixon CJ and Williams J concluded that it was able to be registered. The significance of their Honour’s reasoning was summarised by the majority in Cantarella High Court as follows (at [52]):
In agreeing with Williams J, Dixon CJ described the test for a word having ‘direct reference to the character or quality of the goods’ as lying ‘in the probability of ordinary persons understanding the words, in their application to the goods, as describing or indicating or calling to mind either their nature or some attribute they possess’. His Honour considered ‘TUB HAPPY’ to be allusive such that it did not convey a meaning or idea ‘sufficiently tangible’ to amount to a ‘direct reference’ to the character or quality of the goods. Citing with approval Lord Macnaghten in the Solio Case and Parker J in the Diabolo Case, Williams J illustrated why a covert and skilful allusive reference to goods does not render a word directly descriptive of goods as that expression is used in trade mark law. His Honour said the registration of ‘TUB HAPPY’ for cotton goods did not prevent others from describing their cotton goods as having the characteristics or qualities of ‘washability, freshness and cheapness’.
(footnotes omitted)
The term “inherently adapted to distinguish” was first introduced in the United Kingdom in 1938, by amendment that in turn influenced the 1955 Act and the TMA as presently in force in Australia. In the United Kingdom the amendment was explained as using statutory language to capture the same principle stated by Lord Parker in Du Cros: Cantarella High Court, at [54].
After summarising the judgments of Kitto J in FH Faulding and Clark Equipment, the majority in Cantarella High Court stated the applicable principle as follows (at [59]).
The principles settled by this court (and the United Kingdom authorities found in this Court to be persuasive) require that a foreign word 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. It is the ‘ordinary signification’ of the word, in Australia, to persons who will purchase, consume or trade in the goods which permits a conclusion to be drawn as to whether the word contains a ‘direct reference’ to the relevant goods (prima facie not registrable) or makes a ‘covert and skilful allusion’ to the relevant goods (prima facie registrable). When the ‘other traders’ test from Du Cros is applied to a word (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. The test does not encompass the desire of other traders to use words which in relation to the goods are allusive or metaphorical. In relation to a word mark, English or foreign, ‘inherent adaption to distinguish’ requires examination of the word itself, in the context of its proposed application to particular goods in Australia.
(emphasis added)
On the proper construction of s 41(3) of the TMA, the majority said, determination of whether a trade mark was inherently adapted to distinguish required consideration of the “ordinary signification” of the words proposed as a trade mark to “any person in Australia concerned with the goods to which the proposed trade mark is to be applied” (at [70]). Their Honours said that once the ordinary signification of a word, English or foreign, is established an enquiry can then be made into whether other traders might legitimately need to use the word in respect of their goods. The majority said that if a foreign word is understood by the target audience as having a directly descriptive meaning in relation to the relevant goods, then prima facie the proprietor is not entitled to a monopoly of it (at [71]). Their Honours went on to identify error in the reasoning of the Full Court:
72Because coffee is a commodity and a familiar beverage consumed by many, the consideration of the ‘ordinary signification’ of the words ‘oro’ and ‘cinque stelle’ in Australia undertaken by the primary judge accorded with settled principles. The Full Court’s rejection of what it called an ‘Anglocentric’ approach revealed a misunderstanding of the expression ‘ordinary signification’ as it has been used in Australia (and the United Kingdom) since at least 1905 to test the registrability of a trade mark consisting of a word or words, English or foreign.
73Both Modena in argument and the Full Court in its reasons misunderstood Lord Parker’s reference in Du Cros to the desire of other traders to use the same or similar mark in respect of their goods. Lord Parker was not referring to the desire of traders to use words, English or foreign, which convey an allusive or metaphorical meaning in respect of certain goods. What Lord Parker’s ‘other traders’ test means in practice is well illustrated by the fate of the marks considered in Faulding, Clark Equipment and Burger King. Like ‘TUB HAPPY’ in respect of cotton goods, ‘ORO’ and ‘CINQUE STELLE’ were not shown to convey a meaning or idea sufficiently tangible to anyone in Australia concerned with coffee goods as to be words having a direct reference to the character or quality of the goods.
The majority said that the evidence led by Modena at trial did not show that registration of the words oro or cinque stelle as trade marks would preclude honest rival traders from having words available to describe their coffee products either as Italian coffee products or as premium coffee or blend products. The evidence fell well short of establishing that the word oro, standing alone, was understood in Australia by persons concerned with coffee products to be directly descriptive of the character or quality of such goods. Nor did the evidence concerning the words cinque stelle.
Two cases of this Court have considered the registrability of foreign words as trade marks since Cantarella High Court.
In Goodman Fielder, Burley J accepted that the mark LA FAMIGLIA would be understood by a substantial number of consumers as being Italian words meaning “the family”, however, they did not have a directly descriptive character when used in conjunction with the designated goods (pasta and bread products). His Honour said that they made only an allusive reference and “did not convey any meaning or idea sufficiently tangible to amount to a direct reference to the character or quality of the goods” (at [235]). His Honour went on to consider whether the words LA FAMIGLIA KITCHEN were inherently adapted to distinguish the applicants’ goods, which he considered to be perhaps more descriptive than the mark LA FAMIGLIA standing alone. His Honour ultimately concluded that the reference to the potential origin of the goods was indirect and that the combination of Italian and English was “sufficient to impart a sufficient degree of inherent distinctiveness” so as to satisfy the requirements of s 41 of the TMA (at [249]).
More recently, Yates J considered the use of foreign words as trade marks in Cantarella Bros Pty Ltd v Lavazza Australia Pty Ltd (No 3) [2023] FCA 1258 (at [417] – [433]), a case again concerning the trade mark oro in its application to coffee products.
As his Honour there mentioned, “the word that is the subject of the inquiry must form part of the ‘common heritage’ – meaning, the common stock of language that is available to be used” (at [420], citing Apple Inc v Registrar of Trade Marks (2014) 227 FCR 511 at [11]), that is, “words that have been received into the stock of language that extends generally throughout the community, not merely to some part of it” (at [421]). Consistent with the majority in Cantarella High Court, his Honour said:
422In the context of legislation that deals with the registrability of a trade mark, the common stock of language can only be the common stock of language that falls within the geographical operation of that legislation. As the operation of the Act extends to Australia, and the external Territories and other areas identified in s 4, that language is, relevantly, Australian English—in other words, the Australian lexicon.
423Secondly, if the word is part of the ‘common heritage’, does it have a ‘signification’—in other words, a ‘meaning’—which can be characterised as one that the word ‘ordinarily’ possesses as part of that language? This is what is captured by the notion of the ‘ordinary signification’ of a word.
424Bringing these strands together, for presently relevant purposes a word will have an ‘ordinary signification’ if it has been received into Australian English and has a commonly understood and commonly shared meaning by ordinary members throughout the Australian community at large.
His Honour said that it was not uncommon for foreign words to be incorporated into a local language and bear an ordinary signification in this sense, giving examples in the Australian lexicon, “encore”, “en route”, and “tour de force”, and “bravo” as confirmed by such words now having accepted dictionary meanings in Australian English (at [425]). However, his Honour said, the mere fact that a foreign word had been (relevantly for present purposes) broadly associated with particular traders or the products of particular traders, did not mean that the word had a commonly understood and shared meaning throughout the community at large (at [426]). That was so, his Honour said, “even where a numerically significant number of people either know the meaning of the foreign word or can deduce its meaning”. His Honour emphasised that the principles stated in Cantarella High Court applied in cases where the question involved the ordinary signification of a word referable to goods or services in a trade involving the community at large, but different considerations might apply where the trade was more specialised or directed to those having special vocational or technical interests (as in Dixon J’s consideration of the word rohoe). His Honour concluded that while the word oro may be understood to mean “gold” by a numerically large number of Australian people, he was far from persuaded that it had been accepted into Australian English to the degree it was commonly understood amongst the general population.
As the latter two cases show, whilst identifying the correct test for descriptiveness is a question of law (now resolved in Cantarella High Court), in its practical application the enquiry is essentially factual, turning on the sufficiency of the evidence adduced in the particular case by the party bearing the onus in respect of it. Here, that party is Modena as the prosecutor on the cross-claim.
Confusion principles
Under s 88(1) of the TMA, the Court may order the rectification of the Register on any one of the grounds specified in s 88(2), including that “because of the circumstances applying at the time when the application for rectification is filed, the use of the trade mark is likely to deceive or cause confusion”: TMA, s 88(2)(c).
The Court may decide not to grant an application for rectification on the ground referred to in s 88(2)(c) if the registered owner of the trade mark satisfies the Court that the ground relied upon by the rectification applicant has not arisen through any act or fault of the registered owner: TMA, s 89(1)(c). In applying s 89 of the TMA, the Court must take into account the matters specified in reg 8.2 of the Regulations, so far as they are relevant:
(a)the extent to which the public interest will be affected if registration of the trade mark is not cancelled;
(b)whether any circumstances that gave rise to the application have ceased to exist;
(c)the extent to which the trade mark distinguished the relevant goods and/or services before the circumstances giving rise to the application arose;
(d)whether there is any order or other remedy, other than an order for rectification, that would be adequate in the circumstances.
Mercato Centrale first filed a cross-claim for rectification on that ground on 31 May 2023. That is the date upon which the asserted likelihood of confusion is to be assessed.
Submissions and evidence
Mercato Centrale submits that neither the Plain Word Mark nor the Fancy Word Mark have the inherent capacity to distinguish Caporaso’s goods and services and that evidence of Caporaso’s use of them before their respective priority dates is insufficient to establish distinctiveness in fact.
It is convenient to focus first on the inherent capacity of the Plain Word Mark (mercato) to distinguish, before turning to consider the Fancy Word Mark and Caporaso’s pre-registration use of either or both of them. It is also convenient in this part of my reasons to set out all of the evidence as it relates to either or both of the Distinctiveness question and the Confusion question, although each question must of course be resolved separately.
It is common ground that the relevant consumers are ordinary members of the Australian public. The Court is not concerned to identify the meaning of a word in a specialised context.
Dictionary and census evidence
The word mercato means “market” or “marketplace” in Italian. It does not appear in the 2020 edition of the Macquarie Dictionary. Nor does the Spanish word mercado (having the same translated meaning).
Data from the 2021 census shows that 228,042 people in Australia spoke Italian at home in the census period, and 171,370 spoke Spanish. Those are not significant numbers given the total Australian population.
The same edition of the Macquarie Dictionary contains several definitions for words having Italian origins (mostly relating to food and drink) such as “bruschetta”, “cappuccino” and “spaghetti”. I would have no difficulty concluding that those words have commonly understood meanings in Australia to English speaking people.
Mercato Centrale submitted that the absence of a word from an English dictionary is not decisive. Whilst I accept that submission, I consider the absence of the word makes it considerably more difficult for a party in Mercato Centrale’s position to establish that the word in its ordinary signification is directly descriptive of the relevant Challenged Goods and Services. Critically, the ordinary signification of the word is not the meaning it has in the minds of speakers of the Italian language. The absence of the word in English dictionaries is plainly relevant to the question of whether the word has any ordinary signification to what the majority in Cantarella High Court described as the target audience, although it is not necessarily decisive.
Trade usage
Mercato Centrale relied on what it described as “extremely wide use of the word MERCATO by many different traders from all around Australia” as indicative of other traders’ desire to use the word or marks incorporating the word at, prior to and after the relevant priority dates. The usage evidence has four sources.
First, there is the testimony contained in affidavits of at least the following traders each of whom was cross-examined at trial:
(1)Mr Giovanni Pasquale Caporaso, the managing director of Caporaso;
(2)Ms Caterina Borsato, a restaurateur with more than 30 years’ experience in the operation of Italian restaurants in Melbourne;
(3)Mr Eddie Muto, a director of Mercato Centrale;
(4)Mr Richard Mee, the former owner of a business trading under the name MERCATO @ daylesford in Victoria from 2004 to 2018; and
(5)Mr Nicholas Basile, a current and former director of companies associated with Panetta Mercato, a specialty grocer with stores in New South Wales.
Second, there are the results of searches of public records undertaken by a solicitor for Mercato Centrale, Ms Noelene Smythe.
Third, there is the result of searches undertaken by Professor Valentyna Melnyk, a marketing expert called to give opinion evidence as part of Mercato Centrale’s case.
Fourth, there are the opinions of Professor Melnyk based on her skills, qualifications and experience, admitted in evidence as an exception to the opinion rule under s 79 of the Evidence Act 1995 (Cth).
Some of the usage evidence was the subject of objection at trial. Rulings on the objections were deferred and the parties were invited to include submissions on admissibility in their oral and written closing arguments. Elsewhere in these reasons I explain my conclusion that the contentious evidence is admissible (see [296] – [316] below) and I have had regard to all of it.
The usage evidence is summarised in Annexure A to each party’s written closing submissions. The following pages incorporate that material, at times adapting the language of the submissions without alteration.
Café via Mercato
An article in The Age newspaper 8 March 1994 referred to a “newcomer” cafe named Café via Mercato situated on Peel Street in Melbourne, serving an awful looking, lack lustre breakfast. The cafe sported a feature wall described as “a delightful melange of packing-case art, punctuated with pumpkins, potatoes, pasta and garlic”.
Ettos Caffe Mercato
An Australian Securities and Investments Commission (ASIC) business extract shows that on 2 May 2000, a company named Diab Corporation Pty Ltd registered the business name “Ettos Caffe Mercato” in New South Wales. There is no evidence that the company in fact operated any business by that name. The same extract shows that a trading name “Ettos Cafe” was used by the same entity. The name Ettos Caffe Mercato was registered as a business and trading name by a different company Pennyhill Pty Ltd from September 2003 to June 2008. There is no evidence that that company in fact operated a business by that name. If a business was conducted by either entity it may be inferred that it was in the nature of a café or that it otherwise had some association with coffee.
MERCATO @ daylesford
Use of the word mercato by this business is detailed elsewhere in these reasons in connection with the ownership question. I there conclude that Caporaso was not the owner of the Plain Word Mark (being the plain word mercato) as at the priority date for its registration. MERCATO @ daylesford was the business name for a restaurant owned and operated from 2004 in Daylesford, Victoria by a company controlled by Mr Mee. In the course of operating that business (and again before the priority date) the word mercato standing alone, or a mark substantially identical to it, was also used as a trade mark in respect of the services provided by the restaurant business. I have had regard to the evidence set out in that part of my reasons in reaching conclusions on the separate question of distinctiveness. I here set out Mr Mee’s evidence as to why he chose the name MERCATO @ daylesford, which I accept.
In cross-examination Mr Mee sad that he could not speak any languages other than English. At the time of choosing a name for the restaurant he did not know the meaning of the word mercato in Italian. He said that he chose the business name after he had a discussion with a friend with an Italian background and who suggested “Why not Mercato?”. He said that in Daylesford there was a market held at the top of the hill each Sunday. The Italian friend described the word mercato as a market that served as a meeting place where people got married, met friends and tasted foods. He said “that kind of tied into a restaurant”. As discussed later in these reasons, the full name MERCATO @ daylesford, with its “@” symbol was suggested by a signwriter when the restaurant name was being painted on the exterior.
Mercato e Cucina
“Mercato e Cucina” was registered as a business name in New South Wales in November 2012 and again (by a different entity) in May 2016. In her affidavit, the operator of the business, Ms Borsato described herself as “unashamedly Italian in every respect”. She confirmed that the business is highly successful restaurant and said that the word cucina means “kitchen” in Italian. There are two newspaper advertisements in evidence referring to a business by that name, dated December 2013 and December 2014. The business name also appeared in a Google Maps search of the terms “mercato sydney” conducted in February 2023.
The business website ( confirms that it is the nature of a restaurant situated in Gladesville New South Wales and that it serves southern Italian cuisine.
In her affidavit, Ms Borsato said that “at Caterina’s I have always used Italian words as well as English on our menus, signage and other customer directed materials. This is because, even though most of our customers are not Italians peakers, the use of Italian language conveys the message that Caterina’s is authentically Italian and the food is true to form and part of the Italian tradition”. She explained the use of the word mercato in the business name as follows:
25.In the early days of having opened my restaurant, I would go to the Victoria Market early in the morning and source fresh produce myself, filling the boot of my car with a variety of things that would make their way onto the daily menu. Nowadays my staff source the produce under my guidance, and I leave the Victoria Market for my Saturday morning personal shopping trips. That said, the amazement of wandering through a hustling bustling market and smelling the various aromas of the fresh food and produce on sale, has not waned.
26.The word ‘mercato’ is Italian for market or market place. The origins of the word come from the Latin word ‘mercatus’ meaning gathering for the purpose of commerce. A ‘mercato’ or ‘market’ is not only a place to source products but also a communal meeting ground or gathering place for people with the same passions to congregate and share experiences. For example a trip for me to the fruit and vegetable section of the Victoria Market is just as much of a social and cultural outing as an outing to source produce to eat. Buying freshly cut ripe artichokes for one of my seasonal dishes at Caterina’s, is more than just buying a vegetable, it is about me envisioning how the artichoke will taste when cooked the Italian way by the hands of my chef Marcello, and the joy that will bring my customers. This is because food and wine and eating a meal together are so central to the Italian way of life, the Italian family unit and the cultural fabric of Italian society. Food is so much more than just food.
27.When I see the word ‘mercato’ used in a business name, I generally understand it to be descriptive of the type of business being run/goods being offered; namely a market or a communal meeting place where products are traded; a coming together in a communal way of various vendors looking to sell their products, and a place for buyers of those products to come together to admire all the different products and buy them. To my mind, the ability of a ‘mercato’ to bring people together and showcase products for sale in a social setting, is just as important as the actual products for sale. There is no limit to what can be traded at a ‘mercato’ - everything from fresh fruit and vegetables, fish, meat, salami and cold meats, grocery items, shoes, second hand goods and so forth.
Panetta Mercato
The conclusions I have reached in this part of my reasons do not exhaust all of the combinations and permutations of goods and services put forward by Caporaso in respect of the threatened or intended use of the Mercato Centrale Marks. I do not consider it necessary to resolve each and every one of them, for two reasons.
First, I do not consider the relevant trade context to be markedly different between those goods and services that are the subject of my findings thus far and those that remain undetermined. The enquiry into deceptive similarity can proceed on the basis of the goods and services in respect of which the Mercato Centrale Marks have been found thus far to have been used or that, on my findings, are intended to be used. A finding that the relevant trade marks are not deceptively similar in the context of the determined goods and services will render it unnecessary to go on to determine the remainder.
Second, the findings thus far encompass enough of what the parties referred to as the high water mark of Caporaso’s infringement action, namely use of the plain combined words mercato centrale in respect of retailing services (by any means) as an infringement of the Plain Work Mark (mercato), registered in respect of the same retail services. I will now explain why that particular infringement allegation is not established.
Alleged infringement of the Plain Word Mark by use of the sign mercato centrale
By the time of closing submissions Caporaso did not persist with any allegation that the marks mercato and mercato centrale were “substantially identical” within the meaning of s 120 of the TMA. The submissions instead focused on whether they were “deceptively similar”. A trade mark is taken to be deceptively similar to another trade mark if it “so nearly resembles that other trade mark that it is likely to deceive or cause confusion”: TMA, s 10.
Principles
Assessing whether a trade mark has been infringed is a “separate and distinct exercise” from the task of assessing whether a trade mark is registrable: Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8; 97 ALJR 388 (at [21]).
The correct approach for determining deceptive similarity has been articulated in various ways in the authorities. They are conveniently summarised in Caporaso’s written submissions at [403] and [404], largely reproduced here:
(1)The essential task is one of trade mark comparison; the resemblance between the two marks must be the cause of the likely deception or confusion: Self Care (at [26]); Swancom Pty Ltd v The Jazz Corner Hotel Pty Ltd [2022] FCAFC 157; 407 ALR 93, Yates, Abraham and Rofe JJ (at [69]).
(2)“Causing confusion” may merely involve “perplexing or mixing up the minds” of potential customers: Self Care (at [30]); Coca-Cola Company v All-Fect Distributors Ltd (1999) 96 FCR 107 (at [39]), quoting Pioneer Hi-Bred Corn Co v Hy-Line Chicks Pty Ltd [1978] 2 NZLR 50 (at 62).
(3)In evaluating the likelihood of confusion, the marks must be judged as a whole, taking into account both their look and their sound: Self Care (at [26]); Cooper Engineering Co Pty Ltd v Sigmund Pumps Ltd (1952) 86 CLR 536 (at 538).
(4)The marks are not to be compared side by side: Self Care (at [27]); Australian Woollen Mills Ltd v F S Walton & Co Ltd (1937) 58 CLR 641 (at 658, 659); Optical 88 Ltd v Optical 88 Pty Ltd (No 2) [2010] FCA 1380; 275 ALR 526 (at [111]).
(5)The effect of spoken description must be considered: Self Care (at [27]); Australian Woollen Mills (at 658, 659); Optical 88 ([111]).
(6)In considering the likelihood of confusion or deception, “the court is not looking to the totality of the conduct of the defendant in the same way as in a passing off suit”: Self Care (at [33]); New South Wales Dairy Corporation v Murray-Goulburn Co-operative Co Ltd [1989] FCA 124; 86 ALR 549 (at 589), approved in CA Henschke & Co v Rosemount Estates Pty Ltd [2000] FCA 1539: 52 IPR 42 (at [44]); Hashtag Burgers Pty Ltd v In-N-Out Burgers Inc [2020] FCAFC 235; 385 ALR 514 (at [64]), Combe International Ltd v Dr August Wolff GmbH & Co KG Arzneimittel [2021] FCAFC 8; 157 IPR 230 (at [27]); PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd (2021) 285 FCR 598 (at [97] and [111]) and Swancom (at [73]).
(7)The question to be asked under s 120(1) is artificial – it is an objective question based on a construct. The focus is upon the effect or impression produced on the minds of potential customers: Self Care (at [28]); Australian Woollen Mills (at 658).
(8)The correct approach is to compare the impression (allowing for imperfect recollection) that the notional buyer would have of the registered mark (as notionally used on all of the goods or services covered by the registration), with the impression that the notional buyer would have of the alleged infringer’s mark (as actually used): Self Care (at [29]); Shell Co (at 415). See also Wingate Marketing Pty Limited v Levi Strauss & Co (1994) 49 FCR 89 (at 128); MID Sydney Pty Ltd v Australian Tourism Co Ltd (1998) 90 FCR 236 (at 245).
(9)It is not necessary to establish that confusion persists up to the point of sale or that actual purchasers will ultimately be deceived: Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 (at 595 – 596).
In addition, in Self Care the High Court (Kiefel CJ, Gageler, Gordon, Edelman and Gleeson JJ) confirmed that the reputation of a registered trade mark is not relevant in the assessment of deceptive similarity under s 120(1). The High Court did however have regard to the conduct of the respondent to the extent that it was relevant to determining the actual use of the allegedly infringing mark. It seems that earlier statements to the effect that the Court is not looking to the conduct of the alleged infringer “as if it were a passing off case” are to be understood as being so qualified. To the extent that there remains any uncertainty about that, nothing in the present case requires any further consideration of it.
The submissions of each party focussed heavily upon cases in which the application for the principles resulted in an outcome that they favoured, Caporaso drawing the Court’s attention to cases in which one mark had been found to be deceptively similar to another, Mercato Centrale focussing on cases where the opposite finding was made. In my view, considerable care must be taken when considering the result of a case turning on an essentially factual question. The cases illustrate how the established principles have been applied to different signs in different contexts, but they do not represent a tariff or standard to be followed in the case before me. With that caution in mind, I have had regard to the authorities cited by Caporaso, in which the following trade marks were found to be deceptively similar:
(1)THE CIRCUIT SPORTS CAFÉ and THE SPORTS CAFÉ: The Sports Cafe Ltd v The Registrar of Trade Marks [1998] FCA 1614; 42 IPR 552, Wilcox, Heerey and Lindgren JJ;
(2)CRAZY RON’S and CRAZY JOHN’S: Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd [2004] FCAFC 196; 209 ALR 1, Moore, Sackville and Emmett JJ;
(3)STAR REALTY and STARR PARTNERS: Starr Partners Pty Ltd v Dev Prem Pty Ltd [2007] FCAFC 42; 71 IPR 459, Lindgren, Emmett and Finkelstein JJ;
(4)BAREFOOT RADLER and BAREFOOT: E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2009) 175 FCR 386, Moore, Edmonds and Gilmour JJ;
(5)HUGGIE MUMMY and HUGGIES: Kimberly-Clark Worldwide Inc v Goulimis [2008] FCA 1415; 253 ALR 76, Jagot J;
(6)CHATSWOOD BBQ KING and BBQ KING: Anakin Pty Ltd v Chatswood BBQ King Pty Ltd [2008] FCA 1467; 250 ALR 620, Branson J;
(7)LUCKY DRAW or LUCKY DREAM and LUCKIES: NV Sumatra Tobacco Trading Company v British American Tobacco Services Ltd (2011) 198 FCR 435, Greenwood J; and
(8)Each of SUNNY ROO, SUNNY ROO PRODUCTS, SUNNY ROO FROM BYRON BAY or SUNNY ROO AUSTRALIA and SUNNY BOY: SMA Solar Technology AG v Beyond Building Systems Pty Ltd (No 5) [2012] FCA 1483, Perram J.
(9)LA FAMIGLIA RANA and LA FAMIGLIA: Goodman Fielder, Burley J.
To that list I would add reference to MOTHER and MOTHERSKY: Energy Beverages LLC v Cantarella Bros Pty Ltd [2023] FCAFC 44; 407 ALR 473 (Yates, Stewart and Rofe JJ).
I have had particular regard to the reasoning of Burley J in Goodman Fielder, being the only authority concerning a registered trade mark comprised of foreign words. His Honour there said (at [344]):
Consumers will read the words ‘LA FAMIGLIA RANA’ on the packaging and, having an impression (which may be imperfect) of the 473 word mark, likely notice that the words ‘LA FAMIGLIA’ in both are the same. They are the first two words of the impugned use and they look and sound the same. They also mean the same thing. In my view these aspects are likely to form a strong impression on consumers. Only the word ‘RANA’ distinguishes the two marks. It is rendered in large letters in a different font to ‘LA FAMIGLIA’. However, in my view the presence of ‘RANA’ will not prevent a substantial number of consumers from wondering whether it might not be the case that products bearing the impugned mark come from the same source. Many will consider that that mark has been entirely used on the packaging, and that the word ‘RANA’ is an addition, connoting either a variant or sub-brand of ‘LA FAMIGLIA’.
In the cases relied upon by Mercato Centrale, the following trade marks were found not to be deceptively similar:
(1)JAZZ CORNER HOTEL and CORNER HOTEL: Swancom Pty Ltd v The Jazz Corner Hotel Pty Ltd (No 2) [2021] FCA 328; 157 IPR 498 (Swancom No 2), O’Bryan J;
(2)THE AGENCY and THE NORTH AGENCY: The Agency Group Australia Limited v H.A.S. Real Estate Pty Ltd [2023] FCA 482; 174 IPR 153, Jackman J;
(3)MULOL and MONSOL: Mond Staffordshire Refinery Co Ltd v Harlem (1929) 41 CLR 475, Knox CJ, Isaacs, Gavan Duffy, Rich, Starke JJ;
(4)RAIN MASTER and RAIN KING: Cooper Engineering, Dixon, Williams, Kitto JJ;
(5)THERMO KING and FRIGIKING: Frigiking Trade Mark [1973] RPC 739, Whitford J;
(6)THE CHIFLEY and CHIFLEY TOWER: MID Sydney; and
(7)AMG and AMH: Australian Meat Group Pty Ltd v JBS Australia Pty Ltd (2018) 268 FCR 623, Allsop CJ, Besanko and Yates JJ.
As briefly summarised below, it was relevant in each case to consider the allegedly infringing sign as a whole. The existence of common words as between the two signs was relevant but not determinative.
In Swancom (No 2), O’Bryan J observed that the words “Corner Hotel” had an ordinary signification to English speakers in Australia as the description of a hotel located on a street corner, and that this was the same signification when used in relation to live music. Additionally, his Honour held that the word “Jazz” was itself an English word with a commonly understood meaning that brought a distinct sound and meaning to the composite phrase “Jazz Corner Hotel” in the allegedly infringing mark. His Honour’s conclusion and reasoning was upheld by the Full Court.
In Agency Group, Jackman J found that “The Agency” and “The North Agency” (both relating to real estate agencies) were not deceptively similar. His Honour found that “The Agency” and “The North Agency” contained words with common meanings amongst English speaking consumers. His Honour (at [54]) also found that the “word ‘agency’ is plainly a description of the nature of a real estate agent’s business”. His Honour’s decision at first instance was upheld by the Full Court.
In Mond Staffordshire, the majority (Knox CJ, Gavan Duffy and Starke JJ) upheld the primary judge’s decision that “Mulsol” was not deceptively similar to “Monsol”. Both marks were used within the medicine and pharmaceutical industry, in which the suffix “-sol” or “-ol” was commonly used. Additionally, other registered trade marks in Australia included marks with the prefix “Mul” such as “Mulsine” and “Mucol”. The majority found that the primary judge had not erred in considering the usage of other marks within the medicine and pharmaceutical industry using a similar prefix or suffix.
In Cooper Engineering, the High Court held that “Rainmaster” was not deceptively similar to “Rain King” as the words “Rain”, “Master” and “King” were all commonly used and understood words within the English language that were incorporated within other trade marks including “Rainwell”, “Rainmaker” and “Rain Queen”.
In Frigiking, Whitford J held that “Thermo King” was not deceptively similar to “Frigiking”. His Honour reasoned (at [753]) that the word “king” connotates excellence and was not a “highly distinctive word” when used in combination with another word in the context of goods.
In MID Sydney, the Full Court held that “The Chifley” when used in respect of hotels was not deceptively similar to “Chifley Tower”, as used in respect of property management services. In relation to deceptive similarity, the Full Court upheld the decision at first instance that the reasonable person would associate “Chifley” to a number of contexts including the former Prime Minister Ben Chifley, the Canberra suburb of Chifley, and Chifley Square in Sydney.
In Australian Meat Group, the Full Court held that the mark “AMG” was not deceptively similar to the mark “AMH”. The Full Court accepted evidence that the letters “AM” were commonly used in the Australian meat industry to delineate “Australian meat”. Cited acronyms included AMPC (Australian Meat Processor Corporation) and AMIC (Australian Meat Industry Council). The Full Court found (at [85]) that this common use was:
… a relevant consideration when considering the question of deceptive similarity … because it affects the significance and weight to be given to the element ‘AM’ that is found in each of the competing marks. …
Submissions and conclusions
Caporaso submitted that mercato is the only word in each of the Caporaso Marks and so is the central feature in each of them. For present purposes it is enough to observe that the word is the only feature of the Plain Word Mark. It may be accepted that even an imperfect recollection of the notional use of the mark would encompass the word mercato in its written or aural representations. The submission about the central feature of the other Caporaso Marks will be considered in due course.
It was then submitted, in comparing the mark mercato centrale:
… it is well established that the first part of a mark is ‘as a rule, far the most important for the purpose of distinction’. …
The case cited for the quoted passage was Conde Nast Publications Pty Ltd v Taylor [1998] FCA 864; 41 IPR 505, Burchett J (at 511), in turn citing a passage from In the Matter of London Lubricants (1920) Limited’s Application to Register a Trade Mark (1925) 42 RPC 264, Sargant LJ (at 279). The passage cited hardly establishes or evidences a rule to which this Court is bound. It concerns the emphasis that may be placed on the first syllable of a word in a particular case. To my mind, the question of whether the first part of a mark is “far the most important” must turn on the facts of the particular case. There can be no rule about that.
It was then submitted that the word centrale does not make the mark mercato centrale so distinguishable so as to diminish the likelihood of confusion, for two reasons. First, it was said that the word mercato was impactful and so more memorable. Second, it was said that the word centrale would be more readily understood by ordinary Australians as being a foreign word which translates to central given the obvious visual and aural similarities between the Italian and English words. It was submitted that the target audience may well understand the word centrale to be a “descriptive add-on”. I do not wholly accept those submissions.
The allegedly infringing mark must be considered as a whole. It consists of two Italian sounding words, not one. Neither word has a proven meaning in English, at least on the evidence before me. The contention that the target audience would regard the word centrale as a mere descriptive add on comes up against the problem that in ordinary English adjectives do not follow nouns. One does not need to be a scholar in grammar to appreciate that. Unlike the signs considered in most of the cases relied upon by the parties, the signs under comparison do not include words having any proven ordinary signification to English speaking consumers. Both of the words are distinctive. Both are Italian sounding. Neither would be readily recognised as a noun or an adjective.
Nor do I accept that members of the target audience would consider mercato centrale to be a sub-brand of mercato, as to my mind neither word is less distinctive or more descriptive than the other. The sign mercato centrale is comprised of two words of equal significance and impact, both visually and aurally. In their aural representation they have a repetitive rhythm that the word mercato alone does not have. I do not consider there to be a risk that Australian consumers with an imperfect recollection of the Plain Word Mark would be caused to wonder whether the services provided by mercato centrale might be a commercial extension, franchise or sub-brand of mercato. In my assessment the word centrale is an obvious differentiating feature that cannot be put aside in the assessment.
It was submitted (perhaps rhetorically) that if the sign mercato centrale was not deceptively similar to mercato, then what would be? That submission appears to me to involve an assumption that there exists an absolute monopoly with respect to the word mercato unhinged from the test for infringement, such that use of any sign that included mercato with the addition of another word must necessarily infringe the Plain Word Mark. It also fails to acknowledge that the word centrale is itself distinctive and so differentiates the sign mercato centrale from the Plain Word Mark.
Mercato Centrale submitted that the enquiry for deceptive similarity was to be undertaken having regard to the relevant trade context. I accept that submission to the extent that trade context informs the factual enquiry as to the actual use of the allegedly infringing mark. Mond Staffordshire is an example. Australian Meat Group is another. The trade context does not include any refence to the registered owner’s reputation in its registered mark, nor the extent of its actual use of its own mark, and I have not had regard to such factors. On that side of the comparison, the focus is upon the registered owners notional, not actual use.
Mercato Centrale went on to submit that the relevant trade context included the extensive trade use of the word mercato in connection with retailing services, food and drink services, shopping centres, cafes, restaurants and pizzerias. I have already rejected that characterisation of the evidence relating to trade usage of the word mercato more generally. I do not accept that the word has been used so extensively that there exists any compelling ‘trade context’, including any basis to find that the word has a commonly accepted meaning among any significant portion of the target audience. I do not accept (as was submitted by Mercato Centrale) that the evidence of Professor Melnyk on that topic was “compelling”. It was not. But it remains that there is no evidence that the word centrale has a commonly understood meaning so that it can be put aside as merely descriptive, and I accept Mercato Centrale’s submissions to that extent.
In all of the circumstances, I am not satisfied that the infringement case based on a comparison between the notional use of the Plain Word Mark and the actual or threatened use of the sign mercato centrale is established. The compared marks are not deceptively similar within the meaning of s 120 of the TMA, assessed reference to the same retail services.
Other comparisons
Given the distinguishing features as between the Plain Word Mark and the remaining Mercato Centrale Marks, I am not satisfied that the Plain Word Mark has been infringed in fact, nor is threatened use established in respect of the other registered goods or registered services in issue. The evidence does not support the claim for injunctive relief for threatened infringement of the Plain Word Mark.
Caporaso’s infringement case is weaker still in the remaining Caporaso Marks (to the extent that a case for infringement of them is pressed). The Fancy Word Mark has visual features that the Plain Word Mark does not, so supplying an additional reason to find that the sign mercato centrale is not deceptively similar. The Red Man Logo contains the word mercato, but that is the only feature in common between that sign and the Plain Word Mark. In critical respects, Caporaso’s submissions in support of the remaining comparisons involved little more than a contention that the word mercato was a central feature of the Caporaso Marks such that use of the word within any one of the Mercato Centrale Marks constituted infringement. That is too simplistic an approach.
In my view, the most striking and distinguishing feature of the Red Man Logo is the illustrated red man character. The Mercato Centrale Marks are not deceptively similar to that sign, notwithstanding that they may have some similar features.
It follows that the infringement action must be dismissed.
PROCEDURAL ORDER AND RULINGS
Procedural order of 10 July 2023
On 10 July 2023 I dismissed an interlocutory application by which Mercato Centrale sought an extension of a deadline previously fixed for the filing of affidavit material upon which it proposed to rely at trial. Oral reasons for dismissing the application were given on that day. In very short summary, I was not satisfied that Mercato Centrale had provided an adequate explanation for requiring the extension of the deadline and in all of the circumstances I did not consider that the order would best promote the overarching purpose of the Court’s civil practice and procedure provisions in accordance with s 37M and s 37N of the Federal Court of Australia Act 1976 (Cth).
In written closing submissions, Mercato Centrale requested that I provide formal written reasons for refusing its application to extend the deadline to file further affidavit material in advance of the trial. I have reflected upon that request and conclude that it should be refused. The order is procedural in nature. It went to an issue commonly dealt with in this Court. If formal written reasons were required to be produced when variations to case management deadlines were refused, the work of this Court may well grind to a halt. It is enough to emphasise that variation of an earlier deadline was sought, without providing an adequate explanation for non-compliance with it. The oral reasons made plain the other matters taken into account, and a transcript of those oral reasons can be provided to the parties if that has not been done already. I will not provide formal written reasons unless an appellate court forms the view that such reasons would facilitate the exercise of its functions.
Rulings on objections to admissibility
In the course of the trial, rulings on objections to the admissibility of the following categories of evidence were reserved:
(1)documents recording company and business names including the word mercato, obtained from databases kept by ASIC, forming annexures EM-2 and EM-3 of Mr Muto’s first affidavit; and
(2)extracts from websites, including evidence of trade mark use in the nature of historical extracts from websites captured by use of the Wayback Machine.
Company and business name searches
Documents tendered by Mercato Centrale show the results of searches conducted on ASIC databases using the search term mercato. The documents are in the form of lists of entities or names that have been registered, deregistered or cancelled. In unchallenged evidence, Mr Muto stated (and I accept) that the lists are in fact the results of searches that he caused his solicitor to carry out on public databases.
In written closing submissions, Caporaso did not appear to maintain any objection to the admissibility of these records. I have concluded that business names are capable of evidencing the use of the name (or a part of it) and the search results are therefore relevant. It is not necessary to consider submissions as to whether they meet the description of an official record of the Commonwealth in accordance with s 155 of the Evidence Act. That is because s 155 is facilitative of the production and proof of such records, but does not limit the ways in which such documents can be produced or tendered.
In the present case, I have accepted the evidence of a witness as to the nature and provenance of the list of search results. Whilst admissible, the lists of search results are to be approached with some caution because, as Burley J explained in Goodman Fielder the registration of a name does not necessarily support a conclusion that the name has been used, let alone used as a trade mark.
I reach the same conclusion with respect to a business name search relating to annexure NMS-5 to the affidavit of Ms Smythe, being a business name record relating to Ettos Café Mercato.
Website extracts
There is some replication in this material as between the first affidavit of Mr Muto (particularly at [27] and EM-4) and the affidavit of Ms Smythe (at [3], [4] and [6] and some annexures referred to there). Caporaso does not maintain an objection to some of it (specifically that relating to the business trading as Henrys Mercato).
Objections are maintained in connection with screen shots from a number of websites, including the following historical extracts said to have been captured by the Wayback Machine:
(1) (said to have been archived on various dates);
(2) (said to have been archived on various dates);
(3) (said to have been archived on 27 September 2020);
(4) (said to have been archived on 27 February 2016);
(5) (said to have been archived on 19 April 2022);
(6) (said to have been archived on 16 September 2021); and
(7) (said to have been archived on 6 January 2006).
The hearsay rule and exceptions
Caporaso’s principal submission is that the website extracts are hearsay evidence and so inadmissible in accordance with s 59 of the Evidence Act. The general exclusionary rule is that evidence of a previous representation made by a person is not admissible to prove the existence of a fact that can reasonably be supposed that the person intended to assert by the representation.
Section 60 of the Evidence Act provides that the hearsay rule does not apply to evidence of a previous representation that is relevant for a purpose other than proof of the asserted fact. If admissible under s 60, the evidence is admissible for all purposes (including hearsay purposes).
Nor does the hearsay rule apply to documents meeting the description of a “business record” under s 69 of the Evidence Act.
Notwithstanding the hearsay rule, the Court may make an order under s 190(3) of the Evidence Act that (relevantly) the hearsay rule does not apply in relation to evidence if:
(a)the matter to which the evidence relates is not genuinely in dispute; or
(b)the application of those provisions would cause or involve unnecessary expense or delay.
Application of s 219 of the TMA
Subject to some exceptions that do not presently apply, the Evidence Act does not affect the operation of any other Act: Evidence Act, s 8.
Section 219 of the TMA provides:
In an action or proceeding relating to a trade mark, evidence is admissible of the usage of the trade concerned and of any relevant trade mark, trade name or get-up legitimately used by other persons.
The emphasis is mine.
The short answer to Caporaso’s objection founded on the hearsay rule is that where a document or thing evidences the use of a relevant trade mark, the document or thing is admissible under s 219 of the TMA notwithstanding any exclusionary rule in the Evidence Act that might otherwise have operated to render it inadmissible. To hold otherwise would be to act contrary to s 8 of the Evidence Act.
Section 219 operates in accordance with its terms. When it applies, it is unnecessary to ask whether the same evidence would prima facie contravene the hearsay rule, and hence unnecessary to identify an exception to that rule, whether in the Evidence Act or elsewhere. As the Full Court said in Commissioner of Patents v Sherman (2008) 172 FCR 394, in which the Full Court stated (at [16]):
…where a provision of the Evidence Act is expressly and directly inconsistent with the provision of some other enactment, the provision of the other enactment will prevail. …
I am satisfied that s 219 of the TMA applies to all of the website extracts, whether or not obtained by the use of the Wayback Machine and whether or not the extracts contain representations of fact adduced to prove their truth.
With respect to the Wayback Machine extracts, the witnesses Ms Smythe and Mr Muto depose to the use of the archive to produce the extract. With some exceptions (discussed below), the extracts are evidence of trade use, including to the extent that they contain representations as to the dates on which the website pages appeared as they are shown in the extracts. In other words, the date evidence forms a part of the evidence of trade mark use and is therefore admissible in accordance with s 219 of the TMA, irrespective of whether it would otherwise have fallen foul of the hearsay rule to prove the fact that the website took a particular form at a particular date.
Application of s 190 of the Evidence Act
The exceptions are the extracts relating to businesses trading from the various market precincts in Melbourne (including one extract obtained by use of the Wayback Machine). Those extracts do not appear to relate to the use of mercato or any other relevant trade mark and I am not satisfied that s 219 of the TMA applies to them. It is unclear what point Mercato Centrale seeks to make of that evidence. If it is intended to show that food products are typically sold in or around marketplaces, that point is hardly controversial. I would admit the evidence (for what it is worth) under s 190 of the Evidence Act even if it was adduced for hearsay purposes, but it has had no material bearing on the outcome of either the infringement action or the cross-claim, because its relevance is marginal.
I would otherwise apply s 190 of the Evidence Act to the Wayback Machine evidence and other website extracts should I be wrong in my conclusion that s 219 of the TMA applies to them. In the present case, Caporaso has itself adduced a multitude of website extracts, referred to at [56] of the affidavit of Mr Caporaso and annexed to it. Mr Caporaso deposed to personally recognising the many extracts as accurately representing the website pages as they appeared at the archived dates, obtained by use of the Wayback Machine. By that evidence Mr Caporaso himself confirmed that the Wayback Machine could be used to obtain historical extracts from a website, that the dates of the extracts appear on the pages, and that he considered the extracts to reliably reproduce the website pages as he recalled them. The Court can act on that evidence to infer that the Wayback Machine can reliably extract webpages from an historical archive. In my view, the reliability of the Wayback Machine in extracting and reproducing webpages at specific capture dates cannot be said to be genuinely in dispute. Separately and apart from that consideration, proof of the appearance of the various websites as at the historical dates shown in them would involve unnecessary expense and delay.
In the circumstances, I consider it necessary to work through the parties’ submissions concerning the exceptions to the hearsay rule in s 60 and s 69 of the Evidence Act, including a submission advanced by Mercato Centrale that some of the evidence could be admitted for relevant non-hearsay purposes and was hence admissible for all purposes.
All of the objections to admissibility are overruled.
ORDERS
As I have mentioned earlier, the parties will be heard as to the form of the order for the rectification of the Register of Trade Marks. The cross-claim will be allowed to the extent recorded in that order, but will otherwise be dismissed. The originating application alleging infringement of the Caporaso Marks will also be dismissed.
The parties should be heard as to costs.
I certify that the preceding three hundred and eighteen (318) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Charlesworth. Associate:
Dated: 26 February 2024
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