Ceramiche Caesar S.p.A v Caesarstone Ltd

Case [2020] FCAFC 124

FEDERAL COURT OF AUSTRALIA

Ceramiche Caesar S.p.A v Caesarstone Ltd [2020] FCAFC 124

Appeal from: Caesarstone Ltd v Ceramiche Caesar S.p.A. (No 2) [2018] FCA 1096 and Caesarstone Ltd v Ceramiche Caesar S.p.A. (No 3) [2019] FCA 7
File numbers: NSD 120 of 2019
NSD 121 of 2019
NSD 132 of 2019
Judges: NICHOLAS, BURLEY AND THAWLEY JJ
Date of judgment: 28 July 2020
Catchwords: TRADE MARKS – where trade marks deceptively similar – whether primary judge erred in concluding there had been honest concurrent use within the meaning of s 44(3)(a) of the Trade Marks Act 1995 (Cth) – where honest concurrent use was in relation to goods which were expressly excluded from trade mark application – whether primary judge erred in concluding that prior concurrent use was authorised use under the respondent’s control for the purposes of ss 7 and 8 of the Act – whether primary judge erred in concluding respondent exercised quality control and control on a wider basis – distinction between quality control over raw material and quality control over designated goods – applications for leave to appeal granted – appeals allowed
Legislation: Trade Marks Act 1995 (Cth) ss 8, 44, 88, 89, 195(2)
Cases cited:

Caesarstone Ltd v Ceramiche Caesar S.p.A. (No 2) [2018] FCA 1096

Caesarstone Ltd v Ceramiche Caesar S.p.A. (No 3) [2019] FCA 7

Granby Pty Ltd v Federal Commissioner of Taxation (1995) 129 ALR 503

Lodestar Anstalt v Campari America LLC (2016) 244 FCR 557

Pioneer Kabushiki Kaisha v Registrar of Trade Marks (1977) 137 CLR 670

Trident Seafoods Corporation v Trident Foods Pty Ltd (2019) 369 ALR 367

Date of hearing: 7 November 2019
Registry: New South Wales
Division: General Division
National Practice Area: Intellectual Property
Sub-area: Trade Marks
Category: Catchwords
Number of paragraphs: 91
Counsel for the Appellant: Mr C Burgess with Ms E Whitby
Solicitor for the Appellant: Spruson & Ferguson Lawyers
Counsel for the Respondent: Mr T Cordiner QC with Ms R White
Solicitor for the Respondent: K&L Gates

ORDERS

NSD 120 of 2019
BETWEEN:

CERAMICHE CAESAR S.P.A

Appellant
AND:

CAESARSTONE LTD

Respondent

JUDGES:

NICHOLAS, BURLEY AND THAWLEY JJ

DATE OF ORDER:

28 JULY 2020

THE COURT ORDERS THAT:

1.The application for leave to appeal be granted.

2.The appeal be allowed.

3.The orders made by the primary judge in proceeding NSD 166 of 2015 on 14 January 2019 be set aside.

4.In lieu of the primary judge’s orders the Court orders:

(a)the appeal from the decision of the Registrar of Trade Marks made by her Delegate on 4 February 2015 in respect of Australian Trade Mark Application No 1058321 be dismissed;

(b)the respondent pay the appellant’s costs of the proceeding before the primary judge and of and incidental to the application for leave to appeal and the appeal.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


ORDERS

NSD 121 of 2019
BETWEEN:

CERAMICHE CAESAR S.P.A

Appellant
AND:

CAESARSTONE LTD

Respondent

JUDGES:

NICHOLAS, BURLEY AND THAWLEY JJ

DATE…

Continue reading Ceramiche Caesar S.p.A v Caesarstone Ltd

Sign in free to access the full text

Details
AGLC
Ceramiche Caesar S.p.A v Caesarstone Ltd [2020] FCAFC 124
Case
[2020] FCAFC 124
Decision Date

CaseChat Overview and Summary

The case of Ceramiche Caesar S.p.A v Caesarstone Ltd involved a dispute over the registration of a trade mark. The primary issue was whether Caesarstone Ltd had made honest concurrent use of the trade mark for certain goods that were expressly excluded from the trade mark application. The appeal was heard by the Federal Court of Australia.

The central legal issues were whether the primary judge had erred in concluding that there had been honest concurrent use within the meaning of section 44(3)(a) of the Trade Marks Act 1995 (Cth), whether the primary judge had erred in finding that Caesarstone exercised control over the designated goods, and whether the application for the Caesarstone Goods Word Mark should be registered under section 44(3)(b) of the Act. The court was also required to determine the effect of a disclaimer in the trade mark application that excluded goods "in the nature of tiles".

The court found that the primary judge had erred in concluding that there had been honest concurrent use of the trade mark for goods that were expressly excluded from the trade mark application. The court held that a finding of honest concurrent use must be a finding of use in respect of goods that are in fact specified in the trade mark application. The court also found that the primary judge had erred in concluding that Caesarstone exercised control over the designated goods, whether by the exercise of quality control or on a wider basis. The court held that the "whole picture" did not substantiate control. Finally, the court held that, given its finding that the primary judge had erred in accepting Caesarstone's case based on honest concurrent use, the question arose as to whether Caesarstone's application for the Caesarstone Goods Word Mark should be permitted to proceed to registration "because of other circumstances". The court held that, given the primary judge's finding in relation to honest concurrent use, the decision not to find for Caesarstone on the basis of s 44(3)(b) was understandable.

The appeal was allowed, the orders made by the primary judge were set aside, Australian Trade Mark Registration No 1211152 was cancelled, and the respondent was ordered to pay the appellant's costs of the proceeding before the primary judge and of the appeal.

Orders

Orders of the court

1. The appeal be allowed.

2. The orders made by the primary judge in proceeding NSD 1719 of 2015 on 14 January 2019 be set aside.

3. Australian Trade Mark Registration No 1211152 be cancelled.

4. The respondent pay the appellant’s costs of the proceeding before the primary judge and of the appeal.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

The primary judge concluded at J[237] that Tessera and Carsilstone “did not know the ultimate application of the Caesarstone slabs when they were purchased and could not control the applications that the slabs were used for once sold and collected”. That does not necessarily mean that those entities did not come to learn about the ultimate application of the slabs. Nevertheless, it is difficult to see how the generalised evidence of communication by the Australian distributors to Caesarstone of the various matters referred to at J[287] can translate into a finding of “control” over the designated goods. Those general matters do not permit a finding of control as a matter of substance.Conclusion on control The primary judge erred in finding that Caesarstone exercised control over the designated goods, whether by the exercise of quality control or “on a wider basis”. The respondent submitted that the court should consider the issue of control by looking at the “whole picture”, not only by considering “individual instances”. That proposition should be accepted. The “whole picture” does not substantiate control. Issue 3 – Should the application for the Caesarstone Goods Word Mark be registered pursuant to s 44(3)(b) of the Act? Caesarstone contended in a Draft Notice of Contention that the primary judge erred in not finding, for the purposes of s 44(3)(b) of the Act, that “because of other circumstances” it was proper to accept the Caesarstone Goods Word Mark application. In his reasons the primary judge referred to the matters relied upon by Caesarstone in support of its case based on s 44(3)(b) which his Honour said “… largely repeated Caesarstone’s submissions in relation to honest concurrent use”. Although his Honour does not say so in terms, it is apparent that, having upheld Caesarstone’s case based on honest concurrent use, he considered that it was not open to him, on the basis of what were essentially the same circumstances as were relied upon by Caesarstone for the purposes of that case, to permit the application to proceed to registration “… because of other circumstances”. This is consistent with the language and structure of s 44(3) which requires there be other circumstances (apart from those that would support a finding of honest concurrent use) in order to justify registration under s 44(3)(b). Given his Honour’s finding in relation to honest concurrent use, the decision not to find for Caesarstone on the basis of s 44(3)(b) is understandable. Given our finding that the primary judge erred in accepting Caesarstone’s case based on honest concurrent use, the question then arises as to whether Caesarstone’s application for the Caesarstone Goods Word Mark should be permitted to proceed to registration “because of other circumstances”. The relevant paragraph of Caesarstone’s Draft Notice of Contention states:Having found that there was honest concurrent use of trade mark application no. 1058321 for the Caesarstone Goods Word Mark pursuant to section 44(3)(a) of the Act, the primary judge erred in not finding that “because of other circumstances” it was proper to accept the application in circumstances where the primary judge found that:(a)there was significant use of the Caesarstone Goods Word Mark in respect of the goods and in respect of the wholesale services and maintenance of those goods during the relevant period;(b)no instances of confusion were proved; and (c)there would be considerable inconvenience to Caesarstone if no effect were given to the fact that Caesarstone had significant sales and significant presence in the Australian marketplace over many years.

Ratio Decidendi

Legal Principle Established

The respondent submitted that his Honour resolved this uncertainty by finding that the tile disclaimer was “ineffectual” (J[743]) and that this interpretation was the only interpretation consistent with his Honour’s finding on honest concurrent use. The respondent submitted that the conclusion that the tile disclaimer was “ineffectual” was supported by his Honour’s finding that the tile disclaimer did not “subtract all content from” the words “panels for floors” and “wall cladding” (J[756]) despite his Honour finding that these goods were “in the nature of tiles”: J[675]. Consideration As a matter of plain English, the words “none of the foregoing being in the nature of tiles” operate to limit the class 19 goods to include only panels for floors, floor coverings and wall claddings which are not in the nature of tiles. The primary judge’s conclusion that the tile disclaimer did not “subtract all content” from the words “[p]anels for floors, floor coverings, and wall cladding” which are not “in the nature of tiles” was a statement of the obvious. For example, the exclusion of tiles might allow for carpet or carpet panels. It is not a statement which supports the conclusion that the tile disclaimer was “ineffectual” in the sense contended for by the respondent. In relation to a submission that the tile disclaimer should be removed from the class 19 specification in the final orders, his Honour stated in Caesarstone (No 3) at [78]: Tiles can be made of composite stone. Goods “in the nature of tiles” were expressly excluded in the original application and, consistently with s 65(7), may not now be included. Although the drafter may not have understood the overlap between goods made of composite stone and tiles, such that the exclusion creates uncertainty, I do not see that the express exclusion of goods “in the nature of tiles” may now be ignored. I refer in this respect to the Reasons at [756] where I held that the limitation did not subtract all content from the words which preceded it. If goods “in the nature of tiles” were not excluded then the rights that the registration would give would be extended to cover tiles. The primary judge was clearly of the view that, if the tile disclaimer was removed from the description of the class 19 goods, the class of goods included in the specification would widen. The primary judge’s conclusion that the tile disclaimer “did not subtract all content” from the preceding words only makes sense if the tile disclaimer has the effect of limiting the words which precede it. The appellant’s submission that the primary judge erred in finding that there was honest concurrent use of the goods outlined in the class 19 specification should be accepted. A finding of honest concurrent use must be a finding of use in respect of goods that are in fact specified in the trade mark application. The goods which were the subject of the primary judge’s honest concurrent use finding were all “in the nature of tiles”. These were expressly excluded from the class 19 specification. There was no other finding of honest concurrent use.