CBT Systems USA Ltd

[1999] ATMO 54

TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR
OF TRADE MARKS, WITH REASONS

Re:Trade mark application number 743227 in the name of CBT SYSTEMS USA, LTD

Background
CBT Systems USA, Ltd ("the applicant") has filed an application to register the trade mark CBTWEB.  The applicant seeks registration, in class 9, for "Computer software, including interactive educational software for information technology education and training".

Issues and arguments
An examiner of trade marks has concluded that the trade mark is not, in terms of subsection 41(2), capable of distinguishing the applicant's goods.  If that is correct then, under that provision, the application must be rejected.  The applicant argued, via its patent attorney, that this conclusion is flawed in principle and inconsistent with a considerable body of contemporary acceptances for registration.  When this was to no avail, after three adverse examiner's reports, the applicant requested to be heard.  I conducted that hearing under delegation from the Registrar of Trade Marks.

Michael Kirov, solicitor, of the attorney firm of Spruson and Ferguson, represented the applicant at the hearing.  Mr Kirov relied, in commencing his submissions, on the so-called "presumption of registrability".  This was described in the Trade Marks Office Draft Manual of Practice and Procedure as follows:

If there is a doubt regarding the registrability of a trade mark, that is unless a sound argument can be put as to why the application cannot be accepted for registration, then the benefit of the doubt should be given to the applicant and the application must be accepted if no other grounds for rejection apply.

Where the Examiner believes that a ground of rejection exists, the ground or grounds should be expressed in a manner that is specific and well documented.

While the second of those paragraphs remains entirely appropriate, the first of them has been overtaken by the decision in Blount Inc v Registrar of Trade Marks (1998) 40 IPR 498. The correct approach is that I must be satisfied that acceptance is appropriate. As Branson J held at 505, this is done where an applicant places before me, "material upon which (I am) persuaded, on the balance of probabilities" that a case has been made:

The effect of such subsections is that a trade mark is not to be taken as capable of distinguishing the goods or services of an applicant from the goods or services of other persons unless the registrar is satisfied of certain matters or the applicant establishes a certain matter…

In full, subsection 41(2) states:  "An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant's services in respect of which the trade mark is sought to be registered from the services of other persons."

Mr Kirov noted the import of a note inserted into s 41 to assist with certain of the provisions.  That note, and the remaining provisions of s 41, I will now set out:

(3) In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.

(4) Then, if the Registrar is still unable to decide the question, the following provisions apply.

(5) If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:

(a)       the Registrar is to consider whether, because of the combined effect of the following:

(i)  the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;
    (ii)  the use, or intended use, of the trade mark by the applicant;
   (iii)  any other circumstances;

the trade mark does or will distinguish the designated goods or services as being those of the applicant; and
(b)       if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken to be capable of distinguishing the applicant's goods or services from the goods or services of other persons; and
(c)       if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken not to be capable of distinguishing the applicant's goods or services from the goods or services of other persons.

(6) If the Registrar finds that the trade mark is not inherently adapted to distinguish the designated goods or services from the goods or services of other persons, the following provisions apply:

(a)       if the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant—the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other persons;
(b)       in any other case—the trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons.

Note 1: Trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate:

(a)     the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; or

(b)     the time of production of goods or of the rendering of services.

Mr Kirov noted that, as a general thing, the level or extent of inherent adaptation necessary if a mark was to be judged, from that alone, to be capable of distinguishing was roughly that required for registration in Part B of the former register.  The Draft Manual of Practice and Procedure, to which he referred on this point, lays down a standard for marks that are "inherently capable of distinguishing".  In this, the draft manual appears to paraphrase the test from Clark Equipment Co v Registrar of Trade Marks. (1964) 111 CLR 511 at 514. I will therefore set the original down in full.

... the question whether a mark is adapted to distinguish [is to] be tested by reference to the likelihood that other persons trading in goods of the relevant kind and being actuated only by proper motives - in the exercise, 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.

As the law examined by Justice Kitto shows, that question, of adaptation to distinguish, in turn relied on a balance of inherent adaptation to distinguish and acquired distinctiveness. 

In approaching the necessary questions, to which I will come shortly, the only material to which I can have regard is the applications themselves.  The applicant has elected not to rely upon evidence of acquired adaptation to distinguish although Mr Kirov has provided me with some copies of material that shows how the mark is apparently used in the USA.

Mr Kirov reiterated his submission that examination of the application to date has focussed unduly on alleged defects of the parts of the mark, CBT and WEB, and not on the registrability of the whole.  I agree with him that the registrability of the whole is not determined simply by the fact that one or more component elements may, individually, lack some or all inherent adaptation to distinguish.  Nevertheless, it is impossible, as a matter of logic, to consider the merit of the mark as a whole in a vacuum.  If parts of the mark are of themselves lacking in inherent adaptation to distinguish, that may well have a bearing on the broader question of whether the whole mark, judged as an entity, is capable of distinguishing.

Mr Kirov disputed the relevance and appropriateness of the examiner's claim that CBT was an acronym for "computer based training".  He said this was, in any case, a particularly vague term, not used in the computer dictionaries he consulted.

I believe the term computer based training is in common use.  Consistent with this, the examiner of trade marks has located a reference, in The Computer Glossary by Alan Freedman, to the use of CBT as an acronym for just that:

the use of the computer for training and instruction.  CBT programs are called courseware and provide interactive training sessions for all variety of disciplines.

Mr Kirov dismissed this as a "red herring" because, he argued, registration of the mark would not interfere with use of the acronym.  However, if there is a red herring in the debate, it arises through the application of an argument of long standing, going back at least as far as the DIAMOND T case, Diamond T Motor Co's application, (1921) 38 RPC 373. Just as good trade marks can be made up of composites of elements that, individually, would not be easy to register, so too can bad ones. In neither case is it at all relevant that the resultant registration might not interfere with the use of the separate components.

As for the remaining component, Mr Kirov has previously noted, in the examination forum, that WEB and NET are essentially interchangeable, and that both are commonly used to indicate the internet, or the part of it that is called the World Wide Web.

He states that he has not been able to conceive of a single grammatically-correct sentence that would in good faith use the CBT trade mark in any obvious, necessary or immediately meaningful manner at all.  I accept this, but I find it surprising.  The applicant's goods are software explicitly designed to assist in computer-based training. To quote from that material:

CBT Systems™ offers you the unique combination of best-of-breed IT computer-based training and flexible, easy-to-use, yet powerful deployment and administration products.  CBT Systems products put students in control of their learning process, and put the administration and reporting capabilities in the hands of the managers.  These capabilities can be delivered via diskette, CD-ROM, downloaded for off-line use directly to a notebook PC played live or downloaded via, LANS, intranets, or even via the Internet.

Conclusion
The applicant's goods can be used to provide or assist in the provision of what can appropriately be called CBT web-based training packages consisting of software and courseware.  Having seen the material provided by the applicant, I am satisfied that other traders will legitimately need terms sufficiently close to the applicant's trade mark, in terms of Michigan, supra, as to show that the trade mark CBTWEB is not capable, on its prima facie merits alone, of distinguishing.

Mr Kirov attempted to support his case by reference to a large number of other instances where the Trade Marks Office has accepted marks ending in either -NET or -WEB.  However, while I admit that some of the examples he raised give me pause for thought, I am still convinced that the present mark is sufficiently short of the necessary degree of inherent adaptation.  That being so, I do not intend to devote time to analysis of other acceptances of marks that, by and large, are at least marginally more adapted to distinguish than is the present one.

Accordingly, my conclusion being that the applicant's mark is not capable of distinguishing the applicant's goods from those of other traders, I now reject the application.

T. Williams
Hearing Officer
28 May 1999