EDB Holdings Inc v Pearle Inc

[1997] ATMO 80

Trade marks act 1995

decision of a delegate of the Registrar of Trade Marks with reasons

Application for an Extension of Time to Serve Evidence in Support of Opposition by PEARLE INC to Applications under s92 of the Act for the Removal from the Register of Trade Marks 493272 and 493273

Background

Trade marks 493272 and 493273 are registered in the name of Pearle Inc. (Pearle).  On 26 February 1996 an application was made to the Registrar by EDB Holdings, Inc (EDB) to remove the trade marks from the Register on the grounds set out in s92(4)(b), that is, that the trade marks had not been used during the three years ending one month before the filing of the application.  The application was accompanied by a statutory declaration of Robert Shelston, registered patent attorney, of Carter Smith & Beadle, setting out the enquiries made on behalf of EDB as to the use of the trade marks in Australia.

Notice of opposition to the removal application was filed by Pearle on 28 June 1996 denying the allegation of non-use relied on by EDB, or, in the alternative, claiming that any failure to use, or to authorise the use of, the trade marks was due to circumstances that were an obstacle to the use of the trade marks during the relevant period in accordance with s100(3)(c) of the Act.

Extensions of time

Evidence in support of the opposition became due for service on the applicant, in accordance with reg 9.4(1), on 28 September 1996.  On 27 September 1996 Pearle applied for an extension of time of three months to 28 December 1996 for the service of the evidence on the grounds set out in the accompanying declaration of Gerard James Skelly, solicitor, of Baker & McKenzie, solicitors for Pearle.  These were that:

• Mr Skelly had been informed by his instructing US attorney that rights in and to the VISION EXPRESS trade mark were the subject of a worldwide dispute between Pearle and EDB Holdings;

• on 17 June 1996 a settlement proposal was submitted to EDB’s Australian attorneys followed by an exchange of correspondence and the submission of a counter-proposal on 11 September 1996; further time was therefore needed to pursue settlement negotiations.

The extension of time was allowed.

On 20 December 1996 Pearle applied for an extension of time to 28 March 1997 for service of its evidence.  Mr Skelly stated in his declaration that he was informed by his instructing US attorney that Pearle was currently co-ordinating settlement negotiations in the United States directly with counsel for EDB.  Further time was therefore needed to pursue negotiations.

The extension of time was allowed.

On 27 March 1997 Pearle applied for an extension of time to 28 June 1997 to serve its evidence.  Mr Skelly stated in his declaration that he believed that negotiations were continuing.

The extension of time was allowed.

On 27 June 1997 Pearle applied for an extension of time to 28 September 1997 to serve its evidence.  Mr Skelly stated in his declaration that he believed that negotiations were continuing.  He added that he understood that Pearle had recently been acquired by Cole National Corporation (Cole).  The US attorneys for Cole had assumed responsibility for the matter and would require time to apprise themselves of the background.

The extension of time was allowed but with a warning that any further application for extension of time would need to be supported by compelling reasons which should include a timetable indicating either completion of service of evidence or when settlement negotiations might be finalised.

On 26 September 1997 Baker & McKenzie applied for a further extension of time to 28 December 1997 for service of its evidence.  This time the declaration in support of the application was made by Ross Glen McLean, a partner of Baker & Mckenzie, the grounds being virtually identical to those of the previous application.  This time the Registrar notified Baker & McKenzie that more compelling reasons were required to justify further time.  Fourteen days were allowed to provide those reasons or to request a hearing of the matter.  On 28 October Baker & McKenzie requested a hearing which was set down for 21 November 1997.  In the meantime, by fax dated 20 November 1997 the attorneys for EDB, Carter Smith & Beadle, objected to the grant of the extension on the grounds that Pearle had had sufficient time to establish use of the trade mark in Australia.  They added that they were instructed by EDB that the belief expressed by Mr McLean that negotiations were continuing was incorrect and that settlement negotiations were not being actively pursued by Pearle.

At the hearing on 21 November 1997 Mr Brian Elkington of Baker & McKenzie made submissions by telephone.  EDB was not represented.

Mr Elkington submitted that because of the takeover of Pearle by Cole it was difficult for the legal representatives of Cole to obtain instructions.  He submitted a declaration, dated 21 November 1997, in support of that submission in which he states that he had spoken that day with Richard Minnich, a partner of the law firm Fay, Sharpe, Beall, Fagan, Minnich & McKee of Cleveland, Ohio, attorneys for Cole.  Mr Minnich had told him that in the months following the takeover of Pearle by Cole the legal department of Pearle had been “decimated” with the result that it was extremely difficult to obtain information from Pearle Inc to support their oppositions in these matters.  He, Mr Elkington, affirmed that negotiations were in fact continuing.

Mr Elkington also states that he spoke on the same day to Mary Francis, an attorney employed by Rudnick & Wolfe of Chicago, Illinois, who represented Pearle before the takeover by Cole.  She told him that settlement negotiations began in October or November 1996.  Attached to the declaration, marked “A”, is a copy of a letter from Ms Francis requesting that negotiations be moved to the United States so that matters involving numerous countries could be handled in a co-ordinated fashion.  In the letter she states that Pearle was striving to “resolve the matter as quickly as possible”.  Attachment “B” to the declaration is a copy of a letter from Ms Francis to Baker & McKenzie stating that “EDB Holdings Inc. has not been quick to respond to your communications”.  Attachment “C” is a copy of a fax to Baker & Mckenzie from Carter Smith & Beadle and a letter from the law firm Thompson Hine & Florey to Carter Smith & Beadle indicating that negotiations within the United States were agreeable.

In addition Mr Elkington states that Ms Francis indicated that Pearle Inc had offered to sell some of its trade mark registrations in approximately 20 countries to EDB and that a price had been indicated.  EDB had replied offering much less unless Pearle summarised the exact marks and gave details of their use in those countries.  Pearle had responded with a complete list of countries and details of use.  That letter had been sent to the attorneys for EDB in the United States in March or April 1997.  Since that time no communication had been received from EDB.  Pearle was therefore awaiting a response from EDB and the statement by Carter Smith & Beadle that Pearle was not actively pursuing negotiations was incorrect.

DECISION

The extension of time sought here is not an extension of time to conclude negotiations but an extension of time to serve evidence of the use of the trade mark in Australia within the relevant three-year period.  Up to a point the pursuit of negotiations to settle opposition proceedings will be accepted as a good ground for the allowance of extensions of time.  But it must not be forgotten that the purpose of extensions of time is for the preparation and service of evidence on the other party.  If this extension is granted the total time so far allowed for the service of at least some evidence of the use of the mark in Australia will be eighteen months which, in all conscience, is more than enough to prove use of a trade mark if there has been any.  Moreover, the applicant for removal has denied that settlement negotiations are being actively pursued by Pearle.  As this was the only ground relied on by Pearle for the grant of the extension of time, that denial clearly placed the onus of establishing the existence of negotiations on Pearle.  The only evidence for the existence of such negotiations is the correspondence between the US attorneys and the Australian attorneys for the parties during the period 28-30 October 1996, more than one year ago.

In the circumstances outlined above I must refuse the extension of time sought by Pearle for the service of evidence in support of its opposition to the removal of trade marks 493272 and 493273 from the Register.

Michael Homann
Hearing Officer

17 December 1997