DC Comics v Joel Beling
[2015] ATMO 76
•21 August 2015
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re:Withdrawn oppositions by DC Comics to registration of trade mark applications 1489613, 1489614, 1489616 and 1489618 in the name of Joel Beling
And
Applications by Joel Beling for an award of costs against DC Comics
| Delegate: | Deirdre O'Brien |
| Representation: | Applicant: Self-represented Opponent: Baker & Mckenzie |
| Decision: | 2015 ATMO 76 Reg 21.12 application for award of costs: oppositions to registration withdrawn after both parties had completed their evidence – applicant requested award of costs against opponent – issues to be considered when the merits of the substantive matters have not been decided – no costs awarded. |
Background
Joel Beling (‘the applicant’) sought registration under the Trade Marks Act 1995 of trade mark applications 1489613, 1489614, 1489616 and 1489618. DC Comics (‘the opponent’) opposed registration. It filed notices of opposition on 15 November 2012 followed by its evidence in support of the oppositions on 14 May 2013. The applicant filed his evidence in answer to the evidence in support on 6 August 2013. Both parties were informed by official notices dated 6 December 2013 that the statutory period allowed for the opponent to file its evidence in reply to the applicant’s evidence in answer had expired and that each opposition was now at a stage where either party could ask to be heard on the merits. The applicant advised by email on 11 December 2013 that he intended to file written submissions. He followed this with another email on 12 December advising that he would require extra time to file his submissions because, inter alia, ‘[t]he opponent has filed a 519-page brief of evidence as part of its evidence in support and I need time to review it and research the claims.’
On 16 December 2013 the applicant requested permission to file further evidence in the proceedings relating to trade marks 1489613, 1489616 and 1489618. The opponent did not object and the Registrar’s delegate allowed his request. In the interests of procedural fairness, the delegate advised the opponent that it had until 28 February 2014 to file evidence in response to the further evidence.
The opponent did not file any evidence and the delegate informed both parties that they had until 19 April 2014 to ask to be heard or to file written submissions in relation to trade marks 1489613, 1489616 and 1489618.
The applicant filed his submissions in relation to all oppositions on 18 March 2014.
On 16 April 2014 the opponent withdrew its oppositions. The applicant responded by submitting that the withdrawals should be regarded as being ‘with prejudice’ and on 15 July 2014 he filed an application for an award of costs in each opposition against the opponent.
By official letter, undated but sent on 15 August 2015, the applicant was informed that the Registrar intended to refuse his request and that he had 14 days in which to ask to be heard in the matter of the intended refusal.[1] On 19 August 2014 the applicant asked to be heard by way of written submission. However, at his request the hearing was deferred until the Federal Court handed down its judgment in Beling v Sixty International S.A.[2] (‘Beling’).That occurred on 20 March 2015 following which the matter was allocated to me, a delegate of the Registrar of Trade Marks, for hearing. I informed the applicant and the opponent that I would hear and decide the matter and in the interests of procedural fairness I gave the opponent an opportunity to participate in the hearing. I set the dates for each party to file their submissions.
[1] Section 203 of the Act provides: The Registrar may not exercise a power under this Act in any way that adversely affects a person applying for the exercise of that power without first giving that person a reasonable opportunity of being heard.
[2] (2015) 228 FCR 194.
I now have before me the official letter setting out the reasons given to the applicant for the intended refusal of his request, both parties’ written submissions and the notices of opposition and evidence filed by the opponent while the oppositions were on foot.
The Law
The provisions of the Trade Marks Act 1995 (Cth) (‘the Act’) relating to the award of costs are set out below:
Section 202 - Registrar’s powers
The Registrar may, for the purposes of this Act:
(a) summon witnesses; and
(b) receive written or oral evidence on oath or affirmation; and
(c) require the production of documents or articles; and
(d) award costs against a party to proceedings brought before the Registrar; and
(e) notify, as he or she considers fit, any person of any matter that, in his or her opinion, should be brought to the person’s notice.Note: For the awarding of costs see section 221.
Section 221 - Costs awarded by Registrar
(1) The Registrar may award costs in respect of the matters, and in the amounts, provided for in the regulations against any party to proceedings brought before him or her.
(2) A party desiring to obtain costs must apply to the Registrar in accordance with the regulations.
(3) If a party is ordered to pay the costs of another party, the costs may be recovered in a court of competent jurisdiction as a debt due by the first party to the other party.
Section 105 - Certificate—use of trade mark
(1) If in any proceedings relating to an opposed application the Registrar or the court has found that:
(a) a trade mark has been used in good faith during a particular period; or
(b) a trade mark has not been used during a particular period solely because of circumstances that were an obstacle to its use;
the Registrar or the court must, if so requested by the registered owner of the trade mark, give to the registered owner a certificate of those findings.
(2) In any subsequent proceedings in which non‑use of the trade mark is alleged:
(a) the certificate is, on being produced, evidence of the facts stated in it; and
(b) if the proceedings are determined in favour of the opponent and, on or before filing the notice of opposition, the opponent notified the applicant of the contents of the certificate—the opponent is entitled, unless the Registrar or the court otherwise directs, to have the opponent’s full costs paid by the applicant.
At the date these oppositions commenced the relevant provisions[3] of the Trade Marks Regulations 1995 (Cth) (‘the Regulations’) were:
[3] Regulation 21.13 was amended on 15 April 2013 by the Intellectual Property Legislation Amendment (Raising the Bar) Regulation 2013 (No. 1) (Cth). The amended reg 21.13 applies to all opposition proceedings commenced on or after 15 April 2013. These oppositions commenced before 15 April 2013.
Regulation 21.12 - Applications for costs
(1) For the purposes of section 221 of the Act (which deals with costs), a party to proceedings before the Registrar may apply to the Registrar, in an approved form, for an award of costs in relation to the proceedings.
(2) An application must be made:
(a) during the proceedings; or
(b) within 3 months from:(i) the day on which the Registrar makes a decision in the proceedings that ends those proceedings; or
(ii) the date of the Registrar’s notice to the party that the proceedings have been discontinued or dismissed;
as the case requires.
(3) Before awarding costs in respect of the proceedings, the Registrar must give each party to the proceedings a reasonable opportunity to be heard in relation to the award of costs.
(4) If a bill of costs is filed in relation to the proceedings, the bill of costs must be filed within 3 months from the day on which the costs are awarded.
Regulation 21.13 - Determination of costs
(1) In this regulation, costs does not include the costs referred to in paragraph 105(2)(b) of the Act.
(2) For the purposes of section 221 of the Act (which deals with costs), costs may only be awarded in respect of a matter set out in Schedule 8.
(3) The amount of costs must be taxed, allowed and certified by an employee appointed by the Registrar for that purpose, in accordance with:(a) in the case of an item in Part 1 of Schedule 8 — the amount specified in that item; or
(b) in the case of a matter set out in a clause in Part 2 of Schedule 8 — that clause.
(4) The Registrar may review the taxation of costs by an employee
Reasons for intended refusal
The reasons for the intended refusal are stated in the official letter as follows:
The proceeding ended without the merits of the opposition being determined. Accordingly I must be satisfied from the facts before me that an award is appropriate. Part 55 of the Trade Marks Office Manual of Practice and Procedure states one of more of the following facts may warrant an award of costs:
· Terms of settlement that deal with the question of costs; or
· Written confirmation by both parties that while they have agreed that an award of costs should be made to one of the parties, they have been unable to agree on the amount to be awarded; or
· The existence of exceptional circumstances that would justify an award of costs, including but not limited to the conduct, non-appearance or disappearance of the other party.
There has been no agreement between the parties regarding costs and I am satisfied that there are no exceptional circumstances that would warrant an award of costs.
[The] facts before me also indicate that the applicant was a self-represented party. The award of costs is meant to reimburse the successful party to a limited extent for the costs it has incurred under Schedule 8 in paying a third party for work done on its behalf. It has been said by the applicant in their submissions that all work [was] done on this matter by the applicant themselves.
I therefore intend to refuse the application for an award of costs.
In his submissions the applicant refers to the official letter as a decision ‘denying the application for an award of costs’ but he is mistaken. The letter only expresses an intention to refuse the application on the part of the delegate. Since the applicant has sought to be heard in response to that delegate’s intention, the decision to award or to refuse costs is now mine to make.
Applicant’s submissions
The applicant’s submissions are lengthy and canvas many issues that are not relevant to my decision. I therefore do not intend to address each of them.
The essential points of the submissions are that:
The opponent’s withdrawal of the oppositions without the applicant’s consent was withdrawal with prejudice.
The opponent effectively surrendered to the applicant and is therefore liable for the applicant’s costs.
Pursuant to Beling the applicant, being a self-represented solicitor, is entitled to costs for work that he has done on his own behalf.
The opponent’s conduct in commencing and prosecuting the oppositions was unreasonable and without reasonable prospect of success and warrants an award of costs above the official scale.
Discussion
Withdrawal with prejudice
I will first address the applicant’s claim that the withdrawal of the oppositions was ‘with prejudice’. Simply stated, the award of costs in court proceedings is intended to provide partial reimbursement to the successful party, but also to deter persons from commencing litigation unless they have a real likelihood of success. Thus if a litigant files a notice of discontinuance with the court without the consent of the respondent, that act carries with it the implication that the litigant is liable for the respondent’s costs. For example rule 26.12 of the Federal Court Rules 2011 (Cth) provides:
(1) A party claiming relief may discontinue a proceeding in whole or in part by filing a notice of discontinuance, in accordance with Form 48.
(2) The party may file the notice of discontinuance:(a) without the leave of the Court or the other party’s consent:
(i) at any time before the return date fixed in the originating application; or
(ii) if the proceeding is continuing on pleadings—at any time before the pleadings have closed; or(b) with the opposing party’s consent—before judgment has been entered in the proceeding; or
(c) with the leave of the Court—at any time.Note 1: For when pleadings close, see rule 16.12.
Note 2: The Court may give leave subject to conditions including costs—see rule 1.33.(3) The notice of discontinuance must:
(a) state the extent of the discontinuance; and
(b) if the discontinuance is by consent—be signed by each consenting party.(4) However, a litigation representative or a representative party must not discontinue a party’s claim without first obtaining the leave of the Court.
(5) An application for a winding up order under section 459P or 461(1) (a) of the Corporations Act 2001 may be discontinued only with the leave of the Court.
(6) A notice of discontinuance filed by one party does not affect any other party to the proceeding.
(7) Unless the terms of a consent or an order of the Court provide otherwise, a party who files a notice of discontinuance under subrule (2) is liable to pay the costs of each other party to the proceeding in relation to the claim, or part of the claim, that is discontinued.However opposition proceedings before the Registrar are not the same as litigating a claim in a court of law. Giving other traders the opportunity to oppose registration of an applied-for trade mark is a fundamental part of the registration process. The Registrar is not in a position to know whether another party may have a superior claim to ownership at common law of the applied-for trade mark based on its first use of an identical trade mark. Nor can the Registrar know whether another party’s trade mark, registered or common law, has established a reputation in Australia such that use of the applied-for trade mark would be likely to deceive or cause confusion. The evaluation of conflicting claims is built into the registration process so that if the applied-for trade mark is registered, registration will give the owner enforceable rights. In light of this, the act of withdrawing an opposition is not viewed by the Registrar in the same way as the courts would view the litigant’s filing of a notice of discontinuance and there is no provision in the Act or Regulations which is the equivalent of Federal Court Rule 26.12.
Section 214 of the Act provides:
(1) A person who has filed an application, notice or request may withdraw it, in accordance with the regulations, at any time while it is still being considered by the Registrar.
(2) If:(a) the right or interest on which the person relied to file the application, notice or request has become vested in another person; and
(b) the other person notifies the Registrar in writing that the right or interest is vested in him or her;
the other person may withdraw the application, notice or request as provided in subsection (1).
Note: For file see section 6.
and reg 21.9 of the Regulations provides:
(1) For the purposes of section 214 of the Act (which deals with withdrawal of applications, notices and requests):
(a) a person who has filed an application, notice or request; or
(b) another person in whom the right or interest in reliance on which the application, notice or request was filed has become vested;
may withdraw the application, notice or request by giving notice in writing of the withdrawal to the Registrar.
(2) If:
(a) the application, notice or request was filed by, or on behalf of, more than 1 person; or
(b) the right or interest mentioned in paragraph (1)(b) has become vested in more than 1 person;
the notice of withdrawal must be signed by, or on behalf of, each of those persons.
(3) If a person mentioned in paragraph (1)(b) withdraws an application, notice or request, the Registrar may require in writing that person to file documentary evidence that is sufficient to establish that the right or interest mentioned in that paragraph is vested in the person.
I find there is no statutory basis for the applicant’s claim that the opponent’s withdrawal of its oppositions should be regarded as ‘with prejudice’ by the Registrar. Further, since the Registrar’s powers cannot extend beyond the various statutes that assign powers to that public office, the applicant’s claim in this regard is without any legal basis.
Effective surrender
In support of his claim that the opponent has effectively surrendered, the applicant referred to Kiama Council v Grant (‘Kiama Council’) where the court considered the relevant authorities for the award of costs in civil enforcement proceedings and concluded:
The principles that emerge from these cases are that in a civil enforcement or judicial review case where there has been no hearing on the merits:
(a) where one party effectively surrenders to the other party by:
(i) discontinuing without the consent of the other party; or
(ii) giving undertakings to the Court or submitting to the Court making orders against the party substantially in the terms or to the effect claimed by the other party;
the proper exercise of the costs discretion will ordinarily be to make the usual order as to costs, unless there is disentitling conduct on the part of the other party; …[4]
[4] (2006) 143 LGERA 441, 457-8 [80].
Given my above discussion of the difference between withdrawal of an opposition to registration of a trade mark and the discontinuation of a civil suit in the Federal Court, I find that in the present matter neither of the court’s pre-requisites for a finding of ‘effective surrender’ apply and therefore the applicant’s claim in this regard to be without merit.
Self-represented litigant
The matter at issue in Beling was whether the Registrar’s delegate erred in finding that a self-represented party in a trade mark opposition is not entitled to its costs. The court held that the delegate failed to take into account the law that in court proceedings a self-represented solicitor litigant is an exception to the general rule that self-represented litigants are not entitled to their costs.[5] The court observed at [77]:
Having determined that the delegate failed to address the correct legal principles in deciding whether Mr Beling was entitled to an order for costs, because the delegate did not recognise the presence of the solicitor litigant exception to the rule that a self-represented party is not entitled to an order for costs, the next issue is what orders, if any, should flow from that in relation to the appeal.
and concluded at [79]:
… In the circumstances of this proceeding, it is plainly not appropriate for the Court to conduct a rehearing on the question of costs. The repository of the power failed to exercise the power according to correct principles, and so none of the underlying claims for costs by Mr Beling has been examined at all. No documents or other evidence have been produced to substantiate his claims as to any quantum of professional costs. No consideration at all has been given to his claims to be entitled to recover costs on an indemnity basis because of the behaviour of the respondent before the Registrar. Those are matters which should be assessed, with appropriate evidence, by the Registrar, who has the requisite familiarity with the conduct of opposition proceedings under the Act. The matter of Mr Beling’s costs application should be determined by the Registrar.
[5] Cachia v Hanes (1994) 179 CLR 403, 410-413; Guss v Veenhuizen (No 2) (1976) 136 CLR 47, 51-52.
I note that the Registrar subsequently awarded costs as requested by Mr Beling in that matter but, as he is yet to submit a bill of costs for taxing, no decision has been made about what costs are allowable. Nevertheless, should I award costs against the opponent, Beling is basis for the applicant, a practising solicitor during the opposition proceedings, to submit a bill of costs for work he did on his own behalf.
Award of costs above the official scale
The power of the Federal Court to award costs other than standard costs[6] was considered in Colgate-Palmolive Co v Cussons Pty Ltd.[7] The court held that s 43 of the Federal Court of Australia Act 1976 (Cth) gave it the jurisdiction to make such an award. I note that s 43(3) currently provides:
[6] Also known as party and party costs.
[7] (1993) 28 IPR 561, 564-565.
(3) Without limiting the discretion of the Court or a Judge in relation to costs, the Court or Judge may do any of the following:
(a) make an award of costs at any stage in a proceeding, whether before, during or after any hearing or trial;
(b) make different awards of costs in relation to different parts of the proceeding;
(c) order the parties to bear costs in specified proportions;
(d) award a party costs in a specified sum;
(e) award costs in favour of or against a party whether or not the party is successful in the proceeding;
(f) order a party's lawyer to bear costs personally;
(g) order that costs awarded against a party are to be assessed on an indemnity basis or otherwise;
(h) do any of the following in proceedings in relation to discovery:(i) order the party requesting discovery to pay in advance for some or all of the estimated costs of discovery;
(ii) order the party requesting discovery to give security for the payment of the cost of discovery;
(iii) make an order specifying the maximum cost that may be recovered for giving discovery or taking inspection.
Section 105 of the Act gives the Registrar jurisdiction to award full costs where, in the circumstance of an opposed application for removal of a registered trade mark for non-use, the Registrar has already certified that the impugned trade mark has been used. In all other trade mark oppositions, the jurisdiction to award costs lies in s 221(1) which provides that the Registrar may award costs in the amounts specified in the Regulations.
The applicant has cited a decision by a delegate of the Commissioner of Patents to award costs for amounts higher than those listed in the official scale.[8] That decision is not on all fours with the present matter. There is no equivalent provision to s 221 in the Patents Act 1990 (Cth). The delegate based his decision on reg 22.8 of the Patents Regulations 1991 (Cth) which provides:
[8] Super Internet Site System Pty Ltd v Sensis Pty Ltd [2006] APO 27.
(1) The Commissioner must not award costs in proceedings to which this Division applies, other than costs specified in Schedule 8, unless each party to the proceedings has had the reasonable opportunity to make a submission on the matter of the award of those costs.
(2) The Commissioner may award an amount:
(a) for costs in respect of a matter specified in column 2 of an item of Part 1 in Schedule 8; or
(b) in respect of the expenses or allowances of a person in relation to proceedings to which this Division applies.(2A) A party to proceedings may request taxation of an amount awarded under subregulation (2).
(3) If a request for taxation is made, the amount must be taxed, allowed and certified, by an employee appointed by the Commissioner for that purpose, in accordance with:(a) the amount specified in column 3 of that item; or
(b) Part 2 in Schedule 8;
as the case may be.
(4) A taxation is subject to review by the Commissioner.
Circumstances which justify the award of costs
As stated in the reasons for the intended refusal, the Registrar’s practice is not to award costs in cases where the merit of the opposition has not been decided unless there are circumstances which would justify an award.[9] In Kiama Council the court observed at [80] that:
[W]here some supervening event or settlement so removes or modifies the subject of the dispute that no issue remains except that of costs, the proper exercise of the costs discretion will ordinarily be to make no order as to costs unless:
(i) one of the parties has acted so unreasonably that the other party should obtain the costs of the action; or
(ii) even if both parties have acted reasonably, one party was almost certain to have succeeded if the matter had been fully tried so that the party should obtain the costs of the action.
[9] This approach is in line with the decision in Aussie Red Equipment Pty Ltd v Antsent Pty Limited [2001] FCA, 1641 (especially at paras 11 & 12) (see Australian Official Journal of Trade Marks issued on 13 and 20 June 2002, Official Notices - an Award of Costs).
The applicant submits that the opponent acted unreasonably in opposing registration as it had no prospect of success. I have briefly reviewed the evidence filed by the opponent in support of the oppositions, being a declaration by its Vice President and Deputy General Counsel Jay Kogan, and find that the opponent had an arguable case in relation to the section 60 ground of opposition. The oppositions were not matters where it was apparent from the beginning that the applicant ‘was almost certain to have succeeded’.
I find that there is no reasonable basis for me to exercise the Registrar’s discretion and award costs against the opponent.
Decision and costs
I refuse the applicant’s request.
I note that the applicant has also sought his costs in relation to this hearing. There is no basis for such an award. Section 202 provides for the award of costs in relation to proceedings brought before the Registrar. This hearing was held at the applicant’s request in response to the Registrar’s intention to refuse to award costs. It was not a hearing held at the instigation of the opponent. There is, in effect, no party to award costs against. At any rate, since the applicant has been unsuccessful in the present matter, he would not ordinarily be entitled to an award in his favour.
Deirdre O'Brien
Hearing Officer
Trade Marks Hearings
21 August 2015
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