Fonterra Co-Operative Group Limited v Vitasoy International Singapore Pte. Ltd

[2019] ATMO 137

TRADE MARKS ACT 1995

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS

Re:Opposition by Fonterra Co-Operative Group Limited to registration of trade mark application 1875463 (29, 30, 32) – GROWING MILK SINCE 1940 - in the name of Vitasoy International Singapore Pte. Ltd.

Delegate:	Nicholas Smith
Representation:	Opponent: Written Submissions by Chapman Tripp Applicant: Siobhan Ryan of Counsel instructed by Davies Collison Cave
Decision:	2019 ATMO 137 Trade Marks Act 1995 (Cth) - Section 52 opposition: ss 42, 43 considered, no ground of opposition established – mark to proceed to registration

Background

1. This is an opposition brought by Fonterra Co-Operative Group Limited (‘Opponent’) pursuant to s 52 of the Trade Marks Act 1995 (Cth) (‘Act’) to registration of the trade mark subject of the application detailed below in the name of Vitasoy International Singapore Pte. Ltd. (‘Applicant’):  

Application Number:	1875463
Filing Date:	25 September 2017
Goods:	Class 29: Almond milk; almond milk beverages; almond milk-based beverage; coconut milk; food products made from nut; coconut milk-based beverage; milk substitute; oat milk; peanut milk; peanut milk-based beverages; rice milk; soya based dairy substitutes; soy milk; soya bean milk in liquid and solid form; beverages made wholly or predominantly of milk substitutes; vegetable based food beverages; food beverages in this class Class 30: Beverages made from cereals Class 32: Soya bean based carbonated and non-carbonated non-alcoholic drinks and beverages, including rice and fruit drinks; non-soya bean based carbonated and non-carbonated non-alcoholic drinks and beverages, including rice and fruit drinks; soya bean-based extracts and concentrates for making carbonated and non-carbonated drinks and beverages; soya based beverages not being milk substitutes; non-soya bean based extracts and concentrates for making carbonated and non-carbonated non-alcoholic beverages; fruit and vegetable juices of all kinds; grain based non-alcoholic beverages; rice-based beverages, other than milk substitutes (‘Applicant’s Goods’)
Trade Mark:	GROWING MILK SINCE 1940	(‘Trade Mark’)

1. Following the advertisement on 15 February 2018 in the Australian Official Journal of Trade Marks of the application’s acceptance for possible registration, the Opponent filed a Notice of Intention to Oppose on 11 April 2018.  The Opponent then filed a Statement of Grounds and Particulars (‘SGP’) on 10 May 2018. The SGP raised grounds of opposition under ss 41, 42(b) and 43 of the Act. The Applicant filed a Notice of Intention to Defend on 18 June 2018.

   Evidence and Submissions

2. The Opponent filed Evidence in Support of its opposition (‘EIS’) on 24 September 2018.  This evidence consists of a declaration made on 21 September 2018 by Victoria Ann Landells, General Manager, Group Regulatory for the Opponent, with Exhibits VL-1 to VL-4 (‘Landells Declaration’) and a declaration made on 24 September 2018 by Aaron Calvin Fanning, Science Manager, Nutrition for the Opponent, with Exhibit AF-1 (‘Fanning Declaration’).

3. The Applicant filed Evidence in Answer (‘EIA’) on 2 January 2019.  This evidence consists of a declaration made on 24 December 2018 by Katherine Louise Kemp, trade mark searcher employed by Davies Collison Cave Pty Ltd, the Applicant’s representatives, with Exhibits KLK-1 to KLK-14 (‘Kemp Declaration’) and a declaration made on 28 December 2018 by Tong Ah Hing, company secretary for Vitasoy International Holdings Limited, the then Applicant (the Application having subsequently been assigned to a related entity), with Exhibits A-G and confidential exhibit H (‘Hing Declaration’).  The Opponent did not file any Evidence in Reply.

4. Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing or to file written submissions.  On 30 May 2019 the Applicant requested an oral hearing.  The matter was set down for a hearing in Canberra on 3 September 2019 and the matter was allocated to me.  In line with usual practice, a letter was sent to the parties on 4 July 2019 which contained a schedule for the provision of written summaries of submissions to be filed prior to the hearing.  The Opponent filed written submissions on 19 August 2019 (‘Opponent’s Submissions’).  The Applicant filed written submissions on 27 August 2019 but in incorrect form, with a copy of the submissions in proper form being filed on 2 September 2019 (‘Applicant’s Submissions’). 

5. At the hearing Siobhan Ryan of Counsel instructed by Michelle Cooper of Davies Collison Cave represented the Applicant, appearing in person while the Opponent did not appear, instead choosing to rely on its written submissions .

6. I am a delegate of the Registrar of Trade Marks and I am to decide the opposition as required by s 55 of the Act which provides that, unless the proceedings are discontinued, dismissed, or have lapsed under s 54A 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.  In doing so I take account of the written record comprised of the materials mentioned in the preceding paragraphs.

   The Opponent

7. The Opponent is a New Zealand company formed in 2001 that produces and exports dairy products.  It employs 1700 people Australia-wide.

8. The relevant claims/statements in the Landells Declaration can be summarised as follows:

   ·    Milk is a unique, naturally secreted, raw material with an established reputation for quality, nutrition and natural goodness.  Soy drinks are the result of a complex manufacturing process involving the extraction of components from the soya bean which is then further processed with a number of foodstuffs added, to provide a cloudy ‘milk-like’ appearance.  Food Standards Australia and New Zealand note that plant-based beverages used as an alternative to milk are often fortified so that consumers are not denied the nutrients present naturally in milk.

   ·    The use of ‘milk’ and other dairy terms are tightly regulated in order to ensure acceptable standards and the integrity of Australian exports.  The Australia New Zealand Food Standards Code defines ‘milk’ as relating to the mammary secretion of milking animals and states that a food that is sold as ‘milk’ must be milk.  A similar definition (limited to cows) exists in the Australian Dairy Produce Act 1986.

   ·    The World Health Organisation and Food and Agriculture Organisation has established the Codex Alimentarius Commission which sets out international standards for health protection and food trade.  Codex Stan 206-1999 also defines milk as relating to the mammary secretion of milking animals.

   ·    The Opponent opposes the mark in order to maintain the meaning and integrity of milk.  It has no objection to soy drinks as such (indeed it sells them) but objects to any initiative which may tarnish the reputation of milk or mislead consumers.

9. The relevant claims/statements in the Fanning Declaration can be summarised as follows:

   ·    Milk and soy drinks differ significantly in their nutritional profiles, which arise from their different primary sources (generally cows and soy beans).  Milk naturally contains a package of more than 10 essential nutrients, while nutritional engineering is required before a soy drink can be considered to contain vitamins and minerals similar to those in milk.  While soy drinks can be fortified to add different nutrients there is no mandatory requirement that such drinks be fortified at all and as such different soy drinks can differ significantly in the nutrition contained.

   ·    As a result of the significantly different nutritional profiles of soy drinks and milk, some consumers may need or want to avoid one or the other.  In particular soy-drinks are only recommended for infants in limited circumstances and other consumers may be allergic or have intolerance for either milk or soy drinks.  In rare cases a person may have an extreme allergic reaction to a protein like soy, called anaphylactic shock.

   ·    There are important medical and common sense reasons for making consumers aware that a particular beverage is either a soy drink or a dairy milk product and the line between these products should not be blurred.

   The Applicant

10. The Applicant is a food and beverage manufacturer, that has adopted the mark VITASOY in respect of a soy milk beverage continuously offered by the Applicant (or its predecessors in title/related entities) since 1940. 

11. The relevant claims/statements in the Hing Declaration can be summarised as follows:

    ·    The Applicant or its related entities offer soy and other plant-based milk drinks under the VITASOY Mark in various jurisdictions, including Australia, where it has sold its products since 1977.  VITASOY products are packaged and promoted in a manner clearly articulating the type of milk product being offered, including ‘rice milk’, ‘soy milk’, ‘almond milk, ‘coconut milk’ and ‘oat milk’.  The Applicant or its related entities markets its products heavily in Australia and has significant annual sales figures.

12. The relevant claims/statements in the Kemp Declaration can be summarised as follows:

    ·    The Macquarie and Oxford English Dictionaries contain a number of definitions of milk including ‘2. any liquid resembling this, as the liquid within a coconut, the juice or sap (latex) of certain plants, the liquid obtained by crushing parts of plants as beans or nuts or tubers, or various pharmaceutical preparations’.

    ·    Wikipedia contains a detailed article on plant milk, noting that it has been consumed for centuries, in various cultures across the planet.

    ·    The Applicant and its related entities offer its VITASOY products, some of which also display the Trade Mark, clearly labelled as soy milk, rice milk, oat milk, coconut milk and almond milk.

    ·    Supermarkets in Australia stock a range of milk, including both dairy milk and other alternative plant-based milks.

    ·    There are numerous trade marks registered in Australia that contain the word ‘milk’ and are registered for plant based milks.

    ·    The Applicant has advertised its products under the Trade Mark in Australia, including as part of a TV commercial in 2017.  This TV commercial was the subject of a complaint to the Australian Advertising Standards Board over whether the Applicant could use ‘milk’ to describe soy milk.   On 11 October 2017 the Advertising Standards Board issued its determination dismissing the complaint noting that the commercial did not make any claims relating to nutritional equivalence and complied with the Australia New Zealand Food Standards Code which recognises that the term ‘milk’ may be used in a food name in connection with the sale and advertisement of plant-based beverages.  The Board expressed the view that most members of the community would recognise and accept plant based milk products as ‘milk’ and considered that the advertisement did not breach the Australia New Zealand Food Standards Code.

    Grounds of Opposition, Onus and Standard of Proof

13. As indicated above in the SGP the Opponent nominated grounds of opposition under ss 41, 42(b) and 43 of the Act although the Opponent does not press the ground of opposition in respect of s 41 of the Act. To successfully oppose the application the Opponent needs to establish at least one of those grounds.

14. The onus of proof in an opposition rests upon the Opponent.[1]  The relevant standard of proof is the ordinary civil standard based on the balance of probabilities.[2]  The date at which the rights of the parties are to be determined is 25 September 2017, being the filing date of the application (‘the relevant date’).[3]

    Discussion

    [1] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58, [32].

    [2] Following Pfizer Products Inc v Karam (2006) 70 IPR 599, [6]-[26], and Telstra Corporation Limited v Phone Directories Company Pty Ltd [ 2015] FCAFC 156, [133].

    [3] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 595.

    Section 43

15. Section 43 of the Act is reproduced below:

    43 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.

16. To establish a ground of opposition under s 43 of the Act, there must be an inherent connotation within the trade mark. As Gyles J in Pfizer Products Inc v Karam commented:

    ‘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; (2006) 70 IPR 599, [53].

17. In Winton Shire Council v Lomas Spender J said:

    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; (2002) 119 FCR 416; (2002) 56 IPR 72, [19].

18. In Primary Health Care Limited v Commonwealth of Australia[6] Jagot J stated:

    [6] [2016] FCA 313,[17].

    Insofar as use of a trade mark would be likely to deceive or cause confusion is concerned (the s 43 issue, on which the respondents bear the onus):

    (1)    The section:

    looks to the inherent qualities of the trade mark of which registration is sought for the purpose of identifying whether the use of the trade mark would be likely to deceive or cause confusion... (Woolworths at [79]).

    (2) “In order for s 43 to apply, the Court must be satisfied that there is a reasonable likelihood of deception or confusion arising because of the connotation within the mark, having regard to the nature of the goods or services to which it is to apply and other relevant considerations” (McCorquodale v Masterson at [26]).

    (3) The purpose of s 43:

    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, rather than, for example, deception by reason of similarity with other marks... (Pfizer Products at [53]).

    (4) “Whether there is a likelihood of deception or confusion is to be answered ‘not by reference to the manner in which the applicant for registration has used its mark in the past, but by reference to the use to which it can properly put the mark if it becomes registered’: Berlei v Hestia Industries Ltd [1973] HCA 43; (1973) 129 CLR 353 at 362” (Scotch Whisky Association v De Witt [2007] FCA 1649; (2007) 74 IPR 382 (Scotch Whisky Association) at [52]). Deceptive similarity must be considered against the “background of the usages in the particular trade” (Shell Co of Australia Ltd v Esso Standard Oil (Aust) Ltd [1963] HCA 66; (1963) 109 CLR 407 at 410).

    (5) “The probability of deception or confusion must be finite and nontrivial. There must be a ‘real tangible danger of its occurring’ - Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd [1955] HCA 15; (1954) 91 CLR 529 (sic) at 594-5 per Kitto J” (Woolworths at [43]). As such, the mere possibility of confusion is insufficient (Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd [1954] HCA 82; (1954) 91 CLR 592 (Southern Cross Refrigerating) at 595). Further, that “exceptionally stupid or careless consumers might be confused does not suffice” (Scotch Whisky Association at [61]).

    (6) “In order for s 43 to apply, the connotation must be clear and there must be a real and tangible danger that the trade mark, in the context of the relevant services, would be likely to deceive or cause confusion. It would be sufficient if there is ‘real and tangible danger’ of consumers having ‘reasonable doubt’ or being ‘caused to wonder’ about this issue: cf Southern Cross Refrigerating...at 595, per Kitto J” (Accor Australia at [269]).

    (7) All surrounding circumstances must be considered including the circumstances in which the marks will be used, the circumstances in which the services will be provided, and the character of the probable users of the services (Southern Cross Refrigerating at 595).

    (8) The test is not confined to a particular method of use of the marks; the question is “what can the applicant do if he obtains registration?” (Southern Cross Refrigerating at 595). ^[7]

    [7] [2016] FCA 313, [17].

19. The operative test is the secondary meaning which arises from the reasonable expectations of the consumer after considering the meaning in the context of the goods provided. It does not follow that all trade marks containing descriptive matter would attract a section 43 objection. Only if there is a real and tangible danger that the trade mark would cause consumer’s expectations to be false and result in confusion as to the inherent nature of the goods themselves, would section 43 be triggered.

20. The ground of opposition pursuant to s 43 of the Act was particularised in the SGP as follows:

    1 Section 3 of the Dairy Produce Act 1986 defines ‘milk’ as “the lacteal fluid product of the dairy cow”.

    2. “Milk is defined in the [Australia and New Zealand Food Standard] Code at 2.5.1. as:

    (a) the mammary secretion of milking animals, obtained from one or more milkings for consumption as liquid milk or for further processing but excluding colostrums; or

    (b) such a product with phytosterols, phytostanols and their esters added

    3. The Code states at 2.5.1-3:

    Requirement for food sold as milk: a food that is sold as ‘milk’ must be milk.

    4. The Code’s provisions mirror the international position adopted in Codex standard 206-1999.  Under codex ‘milk’ is defined as:

    “the normal mammary secretion of milking animals obtained from one or more milkings without either addition to it or extraction from it, intended for consumption as liquid milk or for further processing”

    5. Milk is a regulated term in Australia that can only be applied to products which fulfil the criteria in the Code.

    6 The Applicant and its related companies are produces of soy, rice, coconut and other plant based liquid products.  The Applicant’s products are not made from, nor do they contain, dairy products, including milk.

    7 The Applicant’s goods to don’t meet the Code’s definition of milk.  They have not been derived from the mammary glands of milking animals; rather they are harvested, highly processed, plant-based alternative beverages to true milk products such as cow’s milk.

    8. Given the prominence of the word ‘milk’ within the Alleged Trade mark, and the lack of ‘milk’ per se in the Applicant’s goods, use of the Alleged Trade mark would be likely to deceive or cause confusion amongst consumers as to the nature of the goods to which it applied.

    9 Registration of the Alleged Trade Mark would be contrary to s 43 of the Trade Marks Act 1995

21. In essence, the Opponent’s submission is that the Trade Mark connotes that the products sold under the Trade Mark are or contain dairy milk when the Applicant’s Goods are plant-based products.  The Opponent submits that the Trade Mark, with its prominent use of the word ‘milk’ will cause a number of people to wonder whether the opposed goods are or contain dairy milk and/or likely to mislead them about the nature of the goods.

22. I accept the Opponent’s evidence, indeed it is undisputed, that there are nutritional differences between dairy milk and the Applicant’s Goods and that some consumers have a strong preference (either driven by medical factors or other factors) for one or the other.

1. However, I do not accept the Opponent’s Submissions to the extent they submit:

   a)that I should view the Trade Mark as a mark prominently containing the word ‘milk’ alone, without any descriptors such as ‘soy’ or ‘rice’.  This approach is incorrect, rather I should look at the Trade Mark as a whole; and

   b)that I should find that any reference to milk without descriptors such as ‘soy’ or ‘rice’, would automatically result in the connotation that the mark products sold under the trade mark are or contain dairy milk.

2. I find on the basis of the evidence before me, including the fact that the Applicant has traded in Australia since 1977, the various meanings of ‘milk’ as defined in dictionaries and the practices of both plant-based milk producers and food and beverage retailers in describing plant-based milks as ‘milks’ (albeit with descriptors), that consumers are aware that there are various plant based beverages that are often described as ‘milk’ (albeit with descriptors such as soy milk or rice milk).   

3. The Trade Mark is GROWING MILK SINCE 1940.  I accept the Applicant’s Submissions that it is artificial to separate the word ‘milk’ from the rest of the mark and thus I do not need to consider whether ‘milk’ by itself refers to dairy milk or other beverages.  While the mark does not contain the common descriptors such as ‘soy’ or ‘rice’, I consider it likely that consumers are aware that dairy milk is not grown (it is milked from a cow, which is raised or bred) whereas the plants that are the primary ingredient of plant-based milk are grown.  As such it is unlikely that a consumer, when viewing the Trade Mark as a whole, would consider that it refers to dairy milk. 

4. Therefore I am not satisfied that members of the public seeing the Applicant’s Goods bearing the Trade Mark would be confused or deceived into wondering or believing that the Trade Mark connotes that the product is dairy milk, as opposed to some other plant-based beverage (i.e. one that is grown), commonly referred to as milk.  This is not a case along the lines of Verband Bayerischer Ausfuhrbrauereien Engetragener Verein v Bravaria NV[8] or Re Opposition by ICC Business Corporation FZ LLC[9] referred to in the Opponent’s Submissions as in those cases the word with the allegedly descriptive connotation was not surrounded by prominent additional elements such as ‘growing’ that operates to clarify and remove the risk of deception or confusion[10].

   [8] (2006) 69 IPR 678.

   [9] (2019) ATMO 65.

   [10] Noting that the element ‘Holland Beer’ in the Bravaria case was significantly less prominent than the Bavaria element on the mark considered by the delegate.

5. With respect to the particulars in the SGP relating to the Australia and New Zealand Food Standard Code I note that at Standard 1.1.1 – 13(4) the Code states that ‘if a food name is used in connection with a food, the sale is taken to be a sale of the food unless the context makes it clear that it is not the intention’ and ‘the context within which foods such as soy milk or soy ice cream are sold is indicated by the name soy; indicating that the product is not a dairy product to which a dairy standard applies’.  What this means is that the use of the Trade Mark by itself is not determinative as to whether or not the Code is breached, rather it is the context in which the food is sold that is relevant, such as whether or not the product is labelled as soy milk or not.  I note that all existing use by the Applicant of the Trade Mark has been on products that are labelled ‘[plant] milk’ and do not on their face breach the Code, and for that reason I cannot reach the conclusion that the mere use of the Trade Mark by the Applicant would deceive or cause confusion or be in breach of the Code.

6. As a consequence, I am not satisfied that if the Trade Mark is used in relation to the Applicant’s Goods, there is an apparent connotation within it which is likely to result in deception or confusion. I find that the ground of opposition under section 43 has not been established.

   Section 42

7. Section 42 of the Act is reproduced below:

   42 Trade mark scandalous or its use contrary to law

   An application for the registration of a trade mark must be rejected if:

   (a) the trade mark contains or consists of scandalous matter; or

   (b) its use would be contrary to law.

8. The Opponent pressed this ground of opposition solely on the basis that the use of the Trade Mark would be contrary to law (s 42(b)).  The onus is on the Opponent to establish that use of the Trade Mark by the Applicant would be, rather than could be, contrary to law on the balance of probabilities.[11]  The relevant time for assessing whether an application is contrary to law is at the relevant date but ‘looking forward to prospective conduct after registration’.[12]

   [11] Advantage Rent-a-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683.

   [12] Time Warner Entertainment Co LP v Stepsam Investments Pty Ltd [2004] 59 IPR 343, 353.

9. The Opponent has particularised the ground of opposition in the SGP and made submissions on the same basis as the s43 ground, namely that the Trade Mark inherently suggests that the Applicant’s Goods to which it is applied are dairy milk products and as such the use of the mark would amount to misleading and deceptive conduct, breach of the Australia and New Zealand Food Standard Code and various state based legislation prohibiting misleading and deceptive conduct/false advertising in respect of the advertising and sale of foods.

10. Given my finding in respect of the s 43 ground above that the Trade Mark, when considered as a whole, does not connote that the Applicant’s Goods are dairy milk or breach the Australia and New Zealand Food Standard Code, I find that the Applicant has failed to establish that the use of the Trade Mark would be contrary to law.

11. Therefore, the Opponent has failed to establish the ground of opposition under s 42(b).

    Decision

12. The Opponent has failed to establish any of the grounds of opposition it nominated in the SGP.  Trade mark application no. 1875463 may proceed to registration not less than 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 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

13. 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 of the Act in the relevant amounts under Schedule 8 of the Trade Mark Regulations 1995.

    Nicholas Smith
    Hearing Officer
    Oppositions and Hearings
    17 September 2019