Donzenac Pty Ltd v MCV Enviroworks Pty Ltd
[2014] ATMO 42
•14 May 2014
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re:Opposition by Donzenac Pty Ltd to registration of trade mark application 1514726(1, 37) - ENVIROBLANKET - filed in the name of MCV Enviroworks Pty Ltd.
| Delegate: | Hearing Officer: Jock McDonagh |
| Representation: | Opponent: Kellie Stonier, Griffith Hack Applicant: Mark Metzeling, IP_Gateways Trade Mark Attorneys |
| Decision: | 2014 ATMO 42 |
Background
This is an opposition brought by Donzenac Pty Ltd (“the Opponent”) pursuant to s 52 of the TradeMarks Act 1995 (“the Act”) to registration of an application filed in the name of MCV Enviroworks Pty Ltd (“the Applicant”) for the following trade mark:
Application number: | 1514726 |
Filing date (Priority date): | 17 September 2012 |
Goods and services: | Class 1: Soil, mulch for soil enrichment, mineral sand, chemically treated sand Class 37: Landscaping services (including soil blasting, soil stabilisation; and soil, rock and mulch spreading) |
Trade Mark: | ENVIROBLANKET |
Following examination and acceptance of the application the Opponent filed Notice of Opposition (“the Notice”) to the registration of the trade mark on 10 January 2013.
The Notice pleaded grounds of opposition under sections 42(b), 43, 44, 58, 60 and 62A of the Act. However, by email dated 11 February 2014, attorneys for the Opponent advised that the Opponent withdrew the grounds under sections 43, 44 and 58 and would only be pursuing grounds under the provisions of sections 42(b), 60 and 62A of the Act. For completeness, I find that none of the withdrawn grounds of opposition, claimed on the Notice, have been established.
The onus is upon the Opponent to establish one or more of its grounds of opposition on the balance of probabilities.[1] Therefore, the grounds remaining for my consideration are those under sections 42(b), 60 and 62A of the Act. Should the Opponent establish any one ground of opposition, there is no requirement for me to consider the other grounds of opposition.
[1] Following Gyles J in Pfizer Products Inc v Karam (2006) 70 IPR 599 at [6] to [26]. See also Chocolaterie Guylian N.V. v Registrar of Trade Marks (2009) 82 IPR 13 per Sundberg J at [22] to [27], Sports Warehouse, Inc v Fry Consulting Pty Ltd (2010) 87 IPR 300 per Kenny J at [30] to [40] and NV Sumatra Tobacco Trading Company v British American Tobacco Services Limited [2011] FCA 1051 (9 September 2011) per Greenwood J at [16] to [32].
The parties served and filed evidence as shown below:
| 6. Declarant | Status | Date, Known as | Exhibits |
| Evidence in Support | |||
| Anthony Phillip Rees | Opponent’s Managing Director | 28.03.13; Rees 1 | AR-1 to AR-16 |
| Anthony Phillip Rees | As above | 5.04.13, Rees Confidential | |
| Evidence in Answer | |||
| Michael Joseph Vella | Applicant’s Director | 3.07.13; Vella 1 | MJV-01 to MJV-12 |
| Mark Stephen Metzeling | Applicant’s Attorney | 9.07.13; Metzeling | MSM-01 to MSM-09 |
| Michael Joseph Vella | As above | 3.07.13; Vella Confidential | |
| Evidence in Reply | |||
| Anthony Phillip Rees | As before | 8.11.13; Rees 2 | AR-17 to AR-21 |
| Susan Lynn Rees | Sales manager, Groundworks | 4.11.13; SLR | LR-1 to LR-6 |
| 7. Declarant | Status | Date, Known as | Exhibits |
| Karen Vella | General manager, Groundworks | 18.09.13; KV | KV-1 to KV-5 |
| Ben Brown | Business Development Manager, Groundworks | 4.09.12; Brown |
Preliminary Matter
On 4 February, the Applicant’s legal representatives requested permission to serve further evidence in the proceedings. The further evidence is a declaration by Michael Joseph Vella, a Director of the Applicant, made on 9 January 2014 and comprising Annexures MJV3-01 to MJV3-O3 (“Vella 2”).
Such requests are to be dealt with in accordance with Trade Marks Regulations 1995, (as applicable to these proceedings) relevantly as follows:
5.15 Extension of period to serve evidence and service of further evidence
(1) A party to the opposition proceedings may apply to the Registrar:
(a) …; or
(b) for permission to serve a copy of further evidence on the other party.
(2) The Registrar may grant an application on reasonable terms specified by the Registrar.
(3) The Registrar must not grant an application unless the Registrar:
(a) is reasonably satisfied that the applicant has served a copy of the application, and of any documents accompanying the application, on the other party; and
(b) has given the parties a reasonable opportunity to make representations concerning the application; and
(c) is reasonably satisfied that:
(i) …
(ii) in the case of an application to which paragraph (1) (b) applies—permission to serve a copy of further evidence;
is appropriate.
(4) For the purposes of paragraph (3) (b), the representations may be made in writing or at a hearing or by such other means as the Registrar reasonably allows.
(5) If the Registrar grants an application under paragraph (1) (b) on terms that include service of a copy of the further evidence within a specified period, a party to the opposition proceedings may apply to the Registrar for an extension of that period.
(6) Subregulations (2), (3) and (4) apply to an application under subregulation (5).
By email dated 5 February 2014, I advised the parties that I could not assess whether permission would be appropriate without knowledge of the Opponent’s grounds of opposition to be pressed. Consequently, I sated that my intention was to seek the Opponent’s representations regarding the further evidence to be forwarded to me at the same time as the submissions on the substantive matter (10 February), and to commence the hearing of the Opposition on 20 February 2014 with preliminary submissions regarding the proposed further evidence, followed by the substantive hearing. The Applicant was at liberty to provide submissions in response to those of the Opponent by 17 February.
The Opponent, through its legal representatives, provided submissions on 18 February 2014, advising of its grounds of opposition and submissions in support of them, and objecting to the serving of specific paragraphs of the further evidence. The objections were because:
·The Applicant could easily have provided this earlier in Vella 1 to support its claim of significant reputation in an “Enviro suite of marks”;
·There were no supporting documents to substantiate the claims made;
·Parts of the evidence were “clearly false”; and
·The Opponent would be prejudiced because it cannot respond to or verify the evidence.
The Applicant on the same day provided submissions for the substantive matter, along with submissions regarding the further evidence. It also sought permission to serve additional further evidence, being a declaration by the attorney for the Applicant.
I commenced hearing the matter as delegate of the Registrar of Trade Marks on 20 February 2014 in Canberra. Kellie Stonier of Griffith Hack Lawyers appeared for the Opponent. Mark Metzeling of IP Gateway Attorneys appeared for the Applicant. The parties appeared by telephone conference link.
The two applications to file further evidence were the subject of oral submissions at the beginning of the hearing. Such submissions had essentially been addressed in writing by the parties before the hearing.
I have now considered the submissions of the parties, as well as the relative inconvenience to parties and the public interest as discussed in Lyons and Anor (Trading as Mitty’s Authorized Newsagency) v Registrar of Trade Marks[2].
[2] (1983) 1 IPR 416
I have decided not to grant permission to serve further evidence in these proceedings. As will be seen, this prejudices neither party. I do not consider that the further evidence was relevant for the purposes of my adjudication in this matter, particularly considering that the Opponent has the persuasive burden.
Discussion
The opponent is a company established in 2003. It is the licensee of the intellectual property rights in a “tackifier” product, a “microblend” used in organic compost material, and owner of the trade mark ECOBLANKET.
The opponent licenses the ECOBLANKET trade mark to Groundworks Pty Ltd in Queensland and other companies in New South Wales, Victoria and South Australia.
The ECOBLANKET trade mark was first used by the Opponent on 29 November 2005 in relation to a type of organic compost and advisory and consulting services in relation to soil analysis, plant species selection, re-vegetation and environmental conservation, including erosion control.
In 2009, Michael Vella began trading as MCV Enviroworks and commenced using ENVIROWORKS in relation to the specified goods and services. MCV Enviroworks Pty Ltd was incorporated on 26 March 2010.
The Opponent, Groundworks and the Applicant are all based in South East Queensland.
During 2010, there was a series of disputes between the parties about the Applicant’s alleged use of ECOBLANKET in relation to its goods and services. The Applicant states that the term ECOBLANKET was used in relation to a search engine on its web site (which was not meant to be “live”) and was not meant to be used in the course of trade. There was further use by the Applicant of ECOBLANKET and “Groundworks” as keywords for advertising on Google®. The Applicant contends this is acceptable and normal business practice and not misleading and deceptive conduct.
On 19 October 2010, the Applicant signed undertakings not to use the word ECOBLANKET or any deceptively similar words in respect of any goods and services provided by the Applicant.
In September 2012, the Opponent became aware of the ENVIROBLANKET application and wrote to the Applicant requesting it cease and desist using the trade mark and to withdraw the application.
Section 60 – Trade mark similar to trade mark that has acquired a reputation in Australia
The first ground of opposition argued by counsel for the Opponent was that under section 60 of the Act, which states:
60. 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.To satisfy section 60 the Opponent must establish:
That another trade mark had, before the priority date of the Applicant’s trade mark, acquired a reputation in Australia in respect of particular goods/services; and
Because of the reputation of that other trade mark, the use of the Applicant’s trade mark would be likely to deceive or cause confusion.
The Opponent has nominated its ECOBLANKET trade mark which was first used on 29 November 2005 (see Rees 1). It is not necessary for the trade mark to registered, it is sufficient that it has been used as a trade mark in the course of trade: Effem Foods Pty Ltd v Wandella Pet Foods Pty Ltd[3]. I am satisfied that there has been prior use of the ECOBLANKET trade mark.
[3] [2006] FCA 767 (23 June 2006)
The opponent uses its trade mark on the following goods and services:
A soil and compost type of mixture that comprises a combination of seeds, compost, tackifier product and organic material.
Advisory and consulting services in relation to erosion control, plant species selection, re-vegetation, environmental conservation; soil analysis and testing services.
These goods and services are clearly similar to those of the Applicant.
It is now for me to determine if the opponent has acquired a reputation in Australia for its ECOBLANKET trade mark. This is more than merely indicating prior use; the opponent’s trade mark needs to be “associated in the minds of the Australian public”[4].
[4] Seven Up Co v OT Ltd (1947) 75 CLR 203 at 211
In relation to reputation Justice Kenny states in McCormick & Co Inc. v McCormick[5], at 128:
In ConAgra Inc v McCain Foods (Aust) Pty Ltd (1992) 33 FCR 302 at 343; 23 IPR 193 at 234, Lockhart J said:
[R]eputation within the jurisdiction may be proved by a variety of means including advertisements on television or radio, or in magazines and newspapers within the forum.
At 129 Justice Kenny continues:
In practice, it is commonplace to infer reputation from a high volume of sales, together with substantial advertising expenditures and other promotions, without any direct evidence of consumer appreciation of the mark, as opposed to the product: …
[5] 51 IPR 102
The Opponent has provided confidential evidence of its annual sales figures from 2006 to 2012, and advertising and promotion expenditure, along with amounts spent on research and applying for industry standards (Rees Confidential).
The Applicant contends that the evidence is not substantiated by way of supporting documentation, and in any event any reputation it might have is limited to South East Queensland.
I am satisfied that the evidence of reputation is just sufficient to satisfy this limb of the ground of opposition.
The final and key limb of the ground is whether the reputation is such that the use of the Applicant’s trade mark would be likely to deceive or cause confusion.
Ms Stonier submitted that the ECOBLANKET and ENVIROBLANKET marks are deceptively similar (while acknowledging that this is no longer a requirement to establish this ground), particularly when considering:
- They both commence with the letter “E”.
- They both have the suffix “BLANKET”, which is the largest component of the mark.
- They both have a strong “o” sound before the common suffix.
Ms Stonier further submitted that the prefixes of the competing trade marks were common abbreviations for ecology and environment respectively, with both trade marks conveying a common idea of environmental, ecological or organic subject matter given the type of goods and services in question.
Mr Metzeling submitted that there needed to be more than reputation proven to establish confusion: There must be other factors such as the level of similarity of the goods or services and the similarity of the trade marks (whether they are deceptively similar or something less); citing Rogers Seller & Myhill Pty Ltd v Reece Pty Ltd[6].
[6] [2010] ATMO 5
He also cited Pottle Productions Inc v Rute Ithalat Ve Ihracat Anonim Sirketi,[7] where the delegate, at [40], observed:
The assessment of the likelihood of deception or confusion under section 60 is informed by the strength of the reputation of the Opponent’s trade mark(s), the inherent distinctiveness thereof, the degree of similarity between the trade marks under consideration and the nexus or connection between the goods and/or services of the parties. Each of these is a variable and it is possible that a trade mark’s reputation might be sufficiently strong and the degree of similarity to an opposed trade mark be so great (particularly where the trade marks are inherently distinctive) that confusion or deception will be a likelihood where very little, if any, nexus or connection exists between the goods and/or services under consideration.
[7] [2012] ATMO 124
I am not persuaded that the competing trade marks are deceptively similar, as suggested by the Opponent. While they share the same suffix, it is very much descriptive of the mulching cover applied to an area. While the words from which the respective prefixes derive have connotations of “greenness” or naturalness, both the complete words and the abbreviations are sufficiently different to avoid confusion or deception.
I am not satisfied persons would be caused to wonder whether it might not be the case that the two products or closely related products and services come from the same source. The opponent has not established this ground of opposition.
Section 42(b) – Use of trade mark would be contrary to law
It necessarily follows that the Opponent could not establish its opposition under subsection 42(b) via section 18 of the Australian Consumer Law as the relevant standard ‘mislead or deceive’ is a higher one than is that of ‘confuse or deceive’ under section 60 of the Act[8].
[8] In Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; (1982) 149 CLR 191; Gibbs CJ said at [8]: “In McWilliam's Wines Pty. Ltd. v. McDonalds System of Australia Pty. Ltd [1980] FCA 159; (1980) 49 FLR 455; 33 ALR 394 it was rightly held by Smithers J. and by Fisher J. that to prove a breach of s. 52 it is not enough to establish that the conduct complained of was confusing or caused people to wonder whether two products may have come from the same source, and that Southern Cross Refrigerating Co. v. Toowoomba Foundry Pty. Ltd. [1953] HCA 73; (1954) 91 CLR 592 , a decision on the Trade Marks Act 1905 (Cth), as amended, is distinguishable.”
Section 62A – Application made in bad faith
Section 62A of the Act provides:
The registration of a trade mark may be opposed on the ground that the application was made in bad faith.
Bennett J in DC Comics v Cheqout Pty Ltd[9] considered bad faith and endorsed the approach taken by Dodds-Streeton J in Fry Consulting Pty Ltd v Sports Warehouse (No 2) [10], wherein her Honour commented:
Bad faith, in the context of s62A, does not, in my opinion, require, although it includes, dishonesty or fraud. It is a wider notion, potentially applicable to diverse species of conduct.
The formulation in the 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 [Harrison’s Trade Mark Application [2005] FSR 10, in which the “combined test” of bad faith was said to involve both subjective and objective elements].
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…
The question is whether, in all the particular circumstances, the applicant’s knowledge was such that his decision to apply for registration at the relevant date would be regarded as in bad faith by persons adopting proper standards.
[9] [2013] FCA 478; (2013) 101 IPR 334.
[10] [2012] FCA 81; (2012) 94 IPR 551, at [164].
I am not persuaded that the Opponent has discharged the onus of establishing that the Applicant, as at the priority date, applied for the trade mark in bad faith, in the sense that Mr Vella’s (or any other officer of the Opponent’s) knowledge as at that date was such, in all the circumstances, that persons adopting proper standards would regard the decision to register as in bad faith, or that reasonable and experienced persons in the field would view such conduct as falling short of acceptable commercial behaviour.
While the conduct alleged in 2010, resulting in cease and desist action, if proved could possibly support a bad faith allegation regarding use of words ECOBLANKET, Groundworks, or such like, the adoption of a different trade mark seems to be in compliance with the undertaking made to the Opponent.
Decision
Section 55(1) of the Act provides:
Unless the proceedings are discontinued or dismissed, 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.
I have found that none of the grounds of opposition raised in the Notice have been established.
Costs
In the event that the Applicant prevailed, Mr Metzeling sought an award of costs in the Applicant’s favour. As the successful party, the Applicant is entitled to its costs and I accordingly award costs against the Opponent in accordance with Schedule 8 of the Trade Marks Regulations 1995.
The trade mark application may then proceed to registration one month from the date of this decision. If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until the appeal has been decided or discontinued.
Jock McDonagh
Hearing Officer
Trade Marks Hearings
14 May 2014
0
14
0