Direct Barrels Pty Ltd v Elevage Global Pty Ltd as trustee for P & G Steer Family Trust
[2023] ATMO 121
•22 August 2023
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re:Opposition by Direct Barrels Pty Ltd to registration of trade mark application number 2051073 (class 20) – ELEVAGE BarriQ with Device - in the name of Elevage Global Pty Ltd as trustee for P & G Steer Family Trust
Delegate: | Anne Makrigiorgos |
Representation: | Opponent: Morcom Pernat Applicant: Jones Tulloch |
Decision: | 2023 ATMO 121 Trade Marks Act 1995 (Cth) – opposition under section 52 –– ss 43, 58, 60 and 62A considered – none established – trade mark to proceed to registration |
Background
This decision concerns an opposition under s 52 of the Trade Marks Act 1995 (Cth)[1] by Direct Barrels Pty Ltd (‘Opponent’) to registration of the following trade mark:
Trade mark number: 2051073 (‘Application’)
Trade mark: (‘Trade Mark’)
Applicant:Elevage Global Pty Ltd as trustee for P & G Steer Family Trust (‘Applicant’)
Filing Date: 14 November 2019 (‘Relevant Date’)
Specification: Class 20: Staves of wood. Parts or components of wooden barrels namely, cut staves, split staves, cut and split staves, sticks, balls made with staves (‘Applicant’s Goods’)
[1] Unless otherwise stated, each reference to a section is a reference to a section of the Trade Marks Act 1995 (Cth) and each reference to a regulation below is a reference to a regulation in the Trade Marks Regulations 1995 (Cth).
The Trade Mark was examined and advertised as accepted for possible registration on 19 May 2020.
On 17 July 2020, the Opponent filed a Notice of Intention to Oppose the Trade Mark. On 17 November 2020, the Opponent filed its Statement of Grounds and Particulars (‘SGP’), which this office gave to the Applicant on 22 March 2021. The Applicant filed a Notice of Intention to Defend the opposition on 15 April 2021.
The Opponent filed Evidence in Support (‘EIS’) on 29 November 2021. The Applicant did not file any Evidence in Answer.
The parties were given the opportunity to either request an oral hearing or to file written submissions. Both parties elected to be heard on the basis of written submissions and both filed written submissions. I have decided this matter based on the particulars set out in the SGP, the EIS and the written submissions of the parties.
Grounds and onus
The SGP nominates grounds of opposition under ss 43, 58, 60 and 62A of the Act. While the Opponent’s written submissions also refer to the ground under s 62(b), that the Registrar accepted the application for registration on the basis of evidence or representations that were false in material particulars, this ground is not in the SGP and therefore is not a ground that requires consideration.
The Opponent carries the burden of establishing one or more of the grounds of opposition[2]. The standard of proof is the ordinary civil standard of the balance of probabilities.[3] The rights of the parties are assessed as at the Relevant Date, being both the filing date and the priority date of the Application.
[2] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58, [32].
[3] Telstra Corporation Ltd v Phone Directories Co Pty Ltd [2015] FCAFC 156, [133].
Evidence
The following evidence was filed as evidence in support:
Declaration of William Henry Willis, Managing Director of the Opponent, made on 29 November 2021 (‘Willis Declaration’) with Annexures WW-01 to WW-05.
No evidence in answer was filed.
The Willis Declaration details the purchase by the Opponent in November 2019 of the assets of a company in liquidation called Flextank International Ltd (‘Flextank’), which traded as Flexcube. Flextank was placed into receivership on 25 September 2019. The Opponent purchased the inventory, Intellectual Property, shares in Flextank and its subsidiaries and all other assets, including trade names and all shares in wholly owned subsidiaries including, inter alia, Flextank Inc (USA). Mr Willis claims that the Intellectual Property included Flextank’s registered and unregistered trade marks and business names including the trade mark BarriQ and therefore the Opponent is the owner of the trade mark BarriQ in respect of staves of wood and other products of wood used in the making and maturation of wine. Annexure WW-01 is a letter from the liquidator attesting to the sale of, inter alia, the Intellectual Property of Flextank by virtue of an Asset Sale Agreement executed on 15 November 2019.
Mr Willis claims that whilst in liquidation, the activities of Flextank continued to be run by the Opponent under license from the administrators/liquidator in November 2019 and that once the assets were purchased, the Opponent began a new business selling all of the Flexcube products, including oak products under the trade mark BarriQ.
Mr Willis annexes WW-03 being details of US Trade Mark No. 6099044 for BarriQ in respect of “convection toasted oak used as inserts for plastic polymer wine maturation barrels” filed on 20 June 2019 by Flexcube Inc and assigned to the Opponent on 8 March 2020.
Mr Willis claims that the trade mark BarriQ was used by Flextank and its associated companies for some years until 14 November 2019. In support of this claim Annexure WW-02 is a copy of a Flexcube Group publication from 2012 showing use of BarriQ by Flextank. The publication shows the trade mark BarriQ used for a line of genuine barrel oak developed by Flexcube and French cooperage experts, Oenowood International.
Mr Willis claims that the trade mark BarriQ has been continuously used in Australia by the Opponent since the purchase of Flextank’s assets.
In support of the claims under [12] and [13] above, Mr Willis annexes a copy of a declaration dated 20 July 2020 by Alban Petiteaux. General Manager of Oenowood International Srl (‘Oenowood’) referring to Oenowood’s development and supply of oak stavewood exclusively to Flextank. Mr Petiteaux states that Flextank trade marked, labelled and sold this oak stavewood under the trade mark BarriQ since 2011 and under the trade mark LBarriQ since 2012. In the first 3 years of the business relationship the oak stavewood was shipped to Flexcube unbranded and Flexcube branded packaging for the oak stavewood in Australia but in 2014 Flexcube requested that Oenowood supply the products already packaged with the trade marks BarriQ or LBarriQ. Two commercial invoices dated 2014 are attached to Mr Petiteaux’s declaration. Mr Petiteaux also confirms that since the acquisition of Flextank by the Opponent they have maintained the exclusive business relationship with the Opponent to produce and supply oak stavewood branded with the trade marks BarriQ or LBarriQ.
Mr Willis claims that the trade mark BarriQ had a substantial reputation within the Australian wine industry prior to the liquidation of Flextank.
Mr Willis also makes claims that the CEO and Managing Director of Flextank was Mr Peter Steer (‘Steer’) who was involved in protecting Flextank’s Intellectual Property and leveraging the value of its trade marks and brokered the exclusive deal with Oenowood.
Mr Willis also claims that the Applicant has a close connection to the P & G Steer Family Trust for which the Applicant is the trustee. Steer is also claimed to be a senior officer of the Applicant and in light of his knowledge of the ownership and reputation in the trade mark BarriQ, filed the Application while Flextank was in liquidation.
Discussion and Reasons
Section 43
Section 43 of the Act provides:
Trade mark likely to deceive or cause confusion
An application for the registration of a trade mark in respect of particular goods or services must be rejected if, because of some connotation that the trade mark or a sign contained in the trade mark has, the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion.
To establish a ground of opposition under s 43, there must be an inherent connotation within the trade mark. As Gyles J commented in Pfizer Products Inc v Karam:
‘Connotation’ is a secondary meaning implied by the mark. The likelihood of deception or confusion must flow from the secondary meaning inherent in the mark itself. It is apparent that the underlying purpose of s 43 is a similar purpose to that lying behind ss 52, 53 and 55 of the Trade Practices Act 1974 (Cth). It is to prevent the public being deceived or confused as to the nature of the goods offered by reason of a secondary meaning connoted by the mark in question.[4]
[4] [2006] FCA 1663 [53].
In Winton Shire Council v Lomas, Spender J noted:
Section 43 is directed to the mark itself. It is not concerned with any deception or confusion caused by the reputation in Australia of some other trade mark. That aspect of the matter is dealt with under s 60.[5]
[5] [2002] FCA 288 [19].
The connotation must be a clear secondary meaning that emanates from the mark itself, something inherent in the mark, such that its use would be likely to deceive or cause confusion.
The Opponent particularized this ground of opposition in the SGP as follows:
The trade mark gives the connotation of an association with the Opponent due to the Opponent’s beneficial earlier use of the trade mark BarriQ.
The Opponent is the owner in Australia, and overseas, of the trade mark BarriQ in relation to staves of wood and other products of wood used in making and maturing of wine. The trade mark BarriQ with used for some years up to 14 November 2019 by Flextank International Ltd and its associated companies. Flextank International Ltd was placed into liquidation on 25 September 2019, and it’s Intellectual Property was sold by the liquidator to the present Opponent Direct Barrels Pty Ltd on 1 January 2020. So the Opponent has obtained, through the purchase, the benefit of earlier use of BarriQ as a trade mark. Use of the word BarriQ, by the applicant would therefore be likely to deceive or cause confusion.
The Opponent’s submissions do not expand on the above.
In response, the Applicant’s submissions assert that the Opponent has misconstrued s 43 as there is no connotation inherent in the Trade Mark.
In order for s 43 to operate to prevent the registration of the Trade Mark, the requisite confusion or deception must arise from a connotation within the Trade Mark itself rather than as a result of any reputation that the Opponent may be able to demonstrate in its own mark. Although s 43 is not generally directed to deception or confusion caused by a reputation in Australia of some other trade mark, there are instances where a sign may be so well known that its registration by someone not associated with its prior use (whether as a trade mark or otherwise) would be confusing by inferring some sort of endorsement of relationship.[6] These circumstances are rare and limited to situations where the sign in question is so well known that it is clearly associated only with a particular organisation or person such that use of it as a trade mark by anyone else would necessarily imply a relationship with that organisation or person.
[6] Amalgamated Television Services Pty Ltd v Clissold (2000) 52 IPR 207.
In the present case, the Opponent’s evidence does not establish that 'BarriQ' is so well known such that use of it by anyone else would imply a relationship with the Opponent.
The s 43 ground of opposition has not been established.
Section 58
Section 58 of the Act provides:
Applicant not owner of trade mark
The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.
Note: For applicant see section 6.
The term ‘owner’ is not defined in the Act. However, it is well established that in the absence of fraud, the original owner of a trade mark is the person who first uses it in Australia, or first files a trade mark application for it in Australia, whichever is earlier.[7]
[7] Shell Co of Australia Ltd v Rohm & Haas Co (1949) 78 CLR 601.
To succeed on this ground of opposition, the Opponent must establish:
·that the Trade Mark is identical, or substantially identical, to the trade mark relied upon by the Opponent;[8]
·that the Applicant’s Goods are the ‘same kind of thing’ as the goods for which the trade mark relied upon by the Opponent have been used;[9] and
·that a person other than the Applicant has an earlier claim to ownership of the Trade Mark based on use of the trade mark relied upon by the Opponent prior to the Application or any actual use of the Trade Mark by the Applicant, whichever is earlier.[10]
[8] Carnival Cruise Lines Inc v Sitmar Cruises Limited [1994] FCA 936 (‘Carnival’).
[9] Re Hicks’ Trade Mark (1897) 22 VLR 636, 640.
[10] Settef SpA v Riv-Oland Marble Co (Vic) Pty Ltd (1987) 10 IPR 402, 413.
The Opponent particularised this ground of opposition in its SGP as follows:
The trade mark BarriQ is currently the property of Direct Barrels Pty Ltd having been purchased from Flextank International Limited (in liquidation). The word BarriQ is a prominent constituent of the opposed trade mark. So the applicant is not properly the owner of the opposed trade mark.
The Opponent’s submissions do not expand on the above.
The Applicant submits that the Opponent fails to even allege (let alone prove) that there has been prior ownership of a substantially identical mark.
As stated above, there are 3 requirements to be satisfied. As it happens, only one needs be considered here, namely whether the Trade Mark is identical, or substantially identical, to BarriQ.
It is readily apparent that the Trade Mark is not identical to BarriQ. The starting point of an analysis as to whether marks are substantially identical is the well-known dicta of Windeyer J in The Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd, where his Honour stated:
In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison. “The identification of an essential feature depends”, it has been said, “partly on the Court’s own judgment and partly on the burden of the evidence that is placed before it” ... Whether there is substantial identity is a question of fact ...[11]
[11] (1963) 109 CLR 407, 414 (‘Shell’) (citations omitted).
Thus, if a total impression of similarity emerges from a comparison between the two marks, the marks are “substantially identical”.[12]
[12] Carnival (n 9) [62].
In Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd (‘Pham Global’), the Full Court clarified the way in which a “side by side comparison” of trade marks is to be carried out in order to determine whether the two marks are substantially identical. The Full Court confirmed that the proper approach for determining whether trade marks are substantially identical is an evaluative process which begins with a comparison of the essential elements of the marks, before considering the differences between them.[13]
[13] Pham Global [2017] FCAFC 83 [52].
In respect of the and BarriQ trade marks, on a side by side comparison of the marks, visually and aurally, it is readily apparent that the Trade Mark is not substantially identical. On a side by side comparison, the dominating elements of the Trade Mark are the distinctive and prominent word ELEVAGE and the distinctive tear drop device. These elements are so significant that the Trade Mark cannot be described as substantially identical to BarriQ. Mere similarity is not enough.
Even though the Trade Mark takes the whole of the BarriQ mark, this element appears in small text in the Trade Mark and is not the sole essential element of the Trade Mark. The dominant cognitive cues of the Trade Mark are the distinctive words ELEVAGE, BarriQ and the distinctive tear drop device together.
I am not satisfied that the Trade Mark is substantially identical to BarriQ and the s 58 ground of opposition has not been established.
Section 60
Section 60 of the Act provides:
Trade mark similar to trade mark that has acquired a reputation in Australia
The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:
(a) another trade mark had, before the priority date for the registration of the first‑mentioned trade mark in respect of those goods or services, acquired a reputation in Australia; and
(b) because of the reputation of that other trade mark, the use of the first‑mentioned trade mark would be likely to deceive or cause confusion.
Note: For priority date see section 12.
To succeed on this ground, I must first decide whether the trade mark BarriQ had a reputation in Australia at the Relevant Date and if so, whether as a result of that reputation, use of the Trade Mark is likely to deceive of cause confusion.
For the purposes of s 60, reputation must be established as a matter of fact by the Opponent[14] and must be amongst a ‘significant’ or ‘substantial’ number of Australian consumers,[15] although this is tempered by the nature of the relevant market. In the present case, the size of the relevant market for parts or components of wooden barrels such as staves and sticks, particularly of wood would be a sufficiently small proportion of Australian population in the wine industry.
[14] ConAgra Inc v McCain Foods (Aust) Pty Ltd [1992] FCA 159 [77].
[15] Renaud Cointreau & Cie v Cordon Bleu International Ltee [2001] FCA 1170 [75].
The reputation of a trade mark may be demonstrated in a variety of ways. For example, it may be established by demonstrating a significant number of people are exposed to a trade mark,[16] or inferred from a high volume of sales,[17] advertising expenditure or other promotion.[18]
[16] Le Cordon Bleu BV v Cordon Bleu International Ltee [2000] FCA 1587 [91].
[17] McCormick & Co Inc v McCormick [2000] FCA 1335 [86] (‘McCormick’).
[18] Ibid.
The Opponent particularised this ground of opposition in its SGP as follows:
The opposed trade mark is a logo comprising a stylised droplet shape into which is super imposed a round – cornered rectangle containing the word ELEVAGE plus the word BarriQ beneath the droplet. The word BarriQ is a significant and integral part of the opposed trade mark. It is significant that, in the opposed trade mark, the word BarriQ has the letters B and Q in upper case while the remaining letters are in lowercase.
The opponent is the owner in Australia, and overseas of the trade mark BarriQ in relation to staves of wood and other products of wood used in the making and maturation of wine. The trade mark BarriQ was used for some 14 years up to 14 November 2019 by Flextank International Ltd and its associated companies. Distinctively the word was almost always represented with the letters B and Q in uppercase while the remaining letters were in lowercase. Flextank International Ltd was placed into liquidation on 25 September 2019, and its intellectual property was sold by the liquidator to the present opponent Direct Barrels Pty Ltd on 1 January 2020. The trade mark BarriQ had a substantial reputation within the Australian wine industry prior to liquidation of Flextank International Ltd. Direct Barrels continues use of the trade mark BarriQ at present.
The Opponent’s submissions do not expand on the above.
In response, the Applicant’s submissions assert that the Opponent has failed to show that any person including the Opponent had established a sufficient reputation at all in BarriQ as at the Priority Date, let alone in Australia as required and in the alternative, even if a sufficient reputation was established in relation to BarriQ, the Opponent has failed to show a likelihood of deception or confusion resulting from a use of the Trade Mark in relation to the Applicant’s Goods.
There are no sales or advertising figures provided, only one example of advertising or promotional materials dated 2012 with unknown circulation and no evidence of actual use or the extent of use of the Opponent’s staves in the Australian wine industry, nor is there any direct evidence of consumer appreciation of BarriQ. This equally applies to the use by Flextank and the Opponent. Even if the use by Flextank of the trade mark BarriQ has inured to the benefit of the Opponent, on the basis of this scant evidence led by the Opponent, the answer would be the same.
Overall, the evidence is lacking in substance and specificity to establish, as a matter of fact, that BarriQ, had acquired a reputation in Australia amongst a significant or substantial number of consumers at the Relevant Date.
Therefore, on the basis of lack of reputation, I do not need to not consider whether as a result of that reputation, use of the Trade Mark is likely to deceive of cause confusion. I find that the s 60 ground of opposition has not been established.
Section 62A
Section 62A of the Act provides:
Application made in bad faith
The registration of a trade mark may be opposed on the ground that the application was made in bad faith.
The case of Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) is a leading Australian authority on s 62A. In that case, Dodds-Streeton J made the following comments, quoting from Harrison’s Trade Mark Application:[19]
Clearly the court, when considering bad faith, cannot apply a purely subjective test, called by Lord Hutton “the Robin Hood test”. The dishonest person or one with low standards cannot be permitted to obtain trade mark registrations in circumstances where a person abiding by a reasonable standard would not. The registration of a trade mark is designed to enable bona fide proprietors to protect their proprietary rights without having to prove unfair trading. Registration is not provided to help those with low moral standards.
... The words “bad faith” suggest a mental state. Clearly when considering the question of whether an application to register is made in bad faith all the circumstances will be relevant. However, the court must decide whether the knowledge of the applicant was such that his decision to apply for registration would be regarded as in bad faith by persons adopting proper standards.[20]
[19] [2004] EWCA Civ 1028.
[20] [2012] FCA 81 [147].
Her Honour continued later in the same decision:
The formulation in United Kingdom authority of bad faith as falling short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in a particular area is, in my view, an apt touchstone. An overly literal application may, however, tend to negate the relevance attributed to the applicant’s mental state in the combined test preferred in Harrison.
Further, in my view, mere negligence, incompetence or a lack of prudence to reasonable and experienced standards would not, in themselves, suffice, as the concept of bad faith imports conduct which, irrespective of the form it takes, is of an unscrupulous, underhand or unconscientious character.[21]
[21] Ibid [165]-[166].
In Hard Coffee Pty Ltd v Hard Coffee Main Beach Pty Ltd, the delegate stated:
The onus of demonstrating ‘bad faith’ falls squarely on the party making such an allegation with the need for evidence able to fulfil the degree of proof required to satisfy the civil standard of ‘balance of probabilities’. That said, the allegation of ‘bad faith’ is a very serious one and a finding of bad faith should not be taken lightly. I note comments from a variety of jurisdictions in support of both propositions.[22]
[22] [2009] ATMO 26 [12] (Hearing Officer Nancarrow).
The Opponent has particularised this ground of opposition in the SGP as follows:
Before Flextank International Ltd was liquidated, its CEO was Mr Peter Steer, who was intimately involved in protecting the company’s intellectual property and leveraging the value of its trade marks. Mr Steer knew the excellent reputation of the trade mark, BarriQ and its value to Flextank International Ltd. Mr Steer is a senior officer in the trade mark applicant Elevate Global Pty Ltd and probably a beneficiary of the P & G Steer Family Trust. The application to register the opposed trade mark was filed only 50 days after Flextank International was placed into liquidation. It is submitted that Mr Steer has caused the present application to be made in bad faith in full knowledge that the trade mark BarriQ was the property of Flextank International Ltd (in liquidation).
The Opponent’s submissions do not expand on the above.
In response, the Applicant’s submissions state that the bad faith ground must fail in circumstances where:
(i) BarriQ has been used in one descriptive manner in the past, is phonetically identical to another descriptive term, and hence does not seem to have the quality of a distinctive mark; and
(ii) there is no documentary corroborative evidence to support the assertion that BarriQ was a piece of intellectual property owned by the Opponent; and
(iii) the Opponent’s case in relation to this ground is completely unsupported by the evidence.
The Opponent has not provided any evidence to support its claims in the SGP. Crucially, while the Willis Declaration and the SGP both assert that Mr Steer was CEO and Managing Director of Flextank, there is nothing in evidence to corroborate that claim. Consequently, there is no evidence offered to corroborate the claim in the SGP and Willis Declaration that Mr Steer knew the reputation of the trade mark BarriQ and its value to Flextank. Such knowledge, even if it could be assumed, is not a sufficient basis for a finding of bad faith.[23]
[23] 1872 Holdings VOF v Havana Club Holding SA [2017] ATMO 12 [64] (Hearing Officer Thompson).
Based on the evidence before me, I am not satisfied that the decision of the Applicant to adopt and seek to register the Trade Mark was a decision made in bad faith.
Therefore, the s 62A ground of opposition has not been established.
Decision
Section 55 relevantly provides:
Decision
(1) Unless subsection (3) applies to the proceedings, the Registrar must, at the end, decide:
(a) to refuse to register the trade mark; or
(b) to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;
having regard to the extent (if any) to which any ground on which the application was opposed has been established.
Note: For limitations see section 6.
The Opponent has failed to establish any of the grounds of opposition it nominated in the SGP. Trade Mark application number 2051073 may proceed to registration not less than one month from the date of this decision. If the Registrar is served with a notice of appeal before that time, I direct that registration shall not occur until either the appeal is withdrawn or discontinued. Otherwise, the disposition of the application should be in accordance with the Court’s order or direction.
Costs
The Applicant has sought an award of costs in its favour. I see no reason to depart from the general rule that costs follow the event. I accordingly award costs against the Opponent under s 221 in the relevant amounts under Schedule 8 of the Regulations.
Anne Makrigiorgos
Hearing Officer
Delegate of the Registrar of Trade Marks
22 August 2023
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