Goodyear Tire & Rubber Compan v Dunlop Aircraft Tyres

[2015] ATMO 14

TRADE MARKS ACT 1995

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

Re:Oppositions by The Goodyear Tire & Rubber Company to registration of trade mark applications 1282093 & 1282094 (12, 37) - DUNLOP and "FLYING D" DEVICE - filed in the name of Dunlop Aircraft Tyres Limited.

Delegate:	Nicole Worth
Representation:	Opponent: Luke Merrick of Counsel, instructed by Ashurst Australia law firm. Applicant: Matthew Darke of Counsel, instructed by Corrs Chambers Westgarth law firm.
Decision:	2015 ATMO 14 Section 52 oppositions – grounds of opposition under sections 44 and 58 established – provisions of subsection 44(3)(b) not applied – registration refused.

Background

1. Pursuant to section 52 of the Trade Marks Act 1995 (‘the Act’), The Goodyear Tire and Rubber Company (‘the Opponent’) opposes applications to register two trade marks filed in the name of Dunlop Aircraft Tyres Limited (‘the Applicant’). The relevant details of the applications are as follows:

1282093

1282094

DUNLOP

(‘the DUNLOP word mark’)*

(‘the Flying D device’)*

Filing date: 23 January 2009

Filing date: 23 January 2009

Goods and services:
Class12: Aircraft tyres and tubes
Class 37: Aircraft tyre re-treading services

Goods and services:
Class12: Aircraft tyres and tubes
Class 37: Aircraft tyre re-treading services

*Referred to collectively as ‘the Trade Marks’.

1. The applications were examined and both faced grounds for rejection under section 44 of the Act on the basis of multiple prior registrations of the DUNLOP word mark or the Flying D device.[1] A majority of the prior registrations are owned by the Opponent, with a smaller number of prior registrations owned by other entities including Ansell Limited (‘Ansell’).

   [1] A ground for rejection was also raised under section 41 of the Act in respect of the DUNLOP word mark, and the provisions of subsection 41(5) were applied as a result of the Applicant’s evidence of use.

2. The Applicant filed evidence of use, the nature of which is contested in these oppositions pursuant to an allegation that it was false in material particulars. For now it is sufficient to note that the Applicant filed evidence of use such that the provisions of subsection 44(4) (in the case of application 1282093) and 44(3)(b) (in respect of both applications) were applied. Accordingly, the Trade Marks were accepted for possible registration and their acceptance was advertised in the Australian Official Journal of Trade Marks on 14 April 2011.

3. The Opponent filed Notices of Opposition (‘the Notices’) on 5 July 2011, nominating most of the grounds available under the Act to oppose registration. Following the service of evidence, described in more detail below, the matter was set down to be heard.

4. I heard the matter, as a delegate of the Registrar of Trade Marks, in Sydney on 25 September 2014. Luke Merrick of Counsel, instructed by Ashurst Australia, represented the Opponent and Matthew Darke of Counsel, instructed by Corrs Chambers Westgarth, represented the Applicant.

Evidence and submissions

1. The evidence served and filed in this matter comprises statutory declarations by:

Evidence in support	Peter Monaghan, Manager and Sales Manager, Aviation Tyres, for Australia and Oceania, for Goodyear Aviation Products, a business/unit division of Goodyear & Dunlop Tyres (Aust) Pty Ltd, a wholly owned subsidiary of the Opponent, with annexures PM-1 to PM-38 containing confidential annexures PM-3, PM-4, PM-7 to 9, PM-32 to PM-34 and PM-38, dated 29 June 2012.
Evidence in answer	Martin Pye, Head of Original Equipment Business and Intellectual Property of the Applicant, with exhibits MP1 to MP9 containing confidential exhibits MP3, MP6 and MP9, dated 11 March 2011 (‘Pye 1’). This declaration comprises the evidence filed during examination upon which acceptance of the applications was based.
Martin Pye, with annexures MP-10 to MP-32 containing confidential annexure MP-20, dated 31 May 2013.
David Skepper, Sales and Marketing Director of the Applicant, with annexure DS-1 and confidential annexure DS-2, dated 31 May 2013.
Evidence in reply	Peter Monaghan, dated 20 December 2013.

1. Prior to discussing in each party’s evidence and submissions, it is useful to start by noting that The Dunlop Pneumatic Tyre Company was founded in the United Kingdom (‘UK’) in 1888. A relatively short time later it set up a tyre distribution outlet in Melbourne. Then in 1899 it disposed of the Australian arm of the business to an entity called The Dunlop Pneumatic Tyre Company of Australasia Ltd. At times, for ease of reference I refer to the entities which are the predecessors of the Opponent and which carried on business in Australia as ‘the Australian business’, and the entities which are the predecessors of the Applicant and which carried on business in the UK as ‘the UK business’ (elaborating where necessary). References to ‘the Opponent’ and ‘the Applicant’ may also be taken as references to their respective subsidiaries and associated entities.

The Opponent’s evidence

1. The Opponent is the current owner in Australia of multiple trade mark registrations containing or comprising the DUNLOP word mark or the Flying D device, as identified below. The registrations are in respect of, inter alia, tyres and retreading of tyres.

Reg No.	Trade Mark	Class	Priority Date
9344	12	25 May 1910
9788	12	27 August 1910
73749	DUNLOP TRAKGRIP	12	6 December 1938
101799	DUNLOP POWERGRIP	12	14 March 1950
108366	DUNLOP ROADTRAK	12	30 November 1951
182139	DUNLOP S.P.	12	8 August 1963
299939	DUNLOP STEELMAX	12	25 August 1976
398346	DUNLOP FORMULA	12	12 October 1983
401752	DUNLOP GRAND PRIX	12	29 December 1983
450077	DUNLOP – No. 1 IN TYRE TECHNOLOGY	12	11 August 1986
450078	DUNLOP – LEADERS IN TYRE TECHNOLOGY	12	11 August 1986
522576	DUNLOP DAYTONA	12	3 November 1989
537310	DUNLOP LE MANS	12	3 July 1990
539255	DUNLOP MONZA	12	1 August 1990
1125812	12	4 June 1965
1125816	12	16 August 1989
1125856	37	24 May 1990
1125857	DUNLOP	12	2 June 1989
1125858	37	24 May 1990
1125859	42	24 May 1990
1125863	DUNLOP	12	16 August 1989
1125865	17	25 May 1910
1160519	DUNLOP SUPER DEALER	35, 37	8 February 2007

1. The Opponent’s title to the registrations occurred via the following summarised history of the business that continued in Australia once the Dunlop Pneumatic Tyre Company of the UK disposed of its Australian arm.

2. The early (pre-1920) ownership of the Australian business appears to have devolved through the Dunlop Pneumatic Tyre Company of Australasia Ltd, the Dunlop Rubber Company of Australasia Ltd and the Dunlop Rubber Company of Australia Ltd. Then in 1920 the entity that would become Ansell was registered as a company and it carried on the Australian business. That company was registered under different names through its history including the Dunlop Rubber Company of Australia Ltd, Dunlop Australia Ltd, Dunlop Olympic Ltd, Pacific Dunlop Ltd and Ansell.

3. Prior to the 1930’s the Australian business imported tyres bearing the Trade Marks from the UK business and distributed them in Australia. Then in the early 1930’s the Australian business commenced manufacturing Dunlop branded tyres, including aircraft tyres, from premises in Melbourne although it continued to import from the UK business those models of tyres it did not manufacture itself.

4. In 1953 the Australian business commenced providing aircraft tyre retreading services from premises also in Melbourne. Those premises were then a Dunlop tyre store which eventually became a specialist aviation tyre retreading factory.

5. Over this time, and in the coming years, the relationship between the Australian and UK businesses was regulated by trade agreements. The more recent agreements are in evidence; however, they are claimed as confidential so I will refrain from discussing their detail. However, in order to provide a sensible basis for this decision it is necessary to note that the agreements geographically restricted the territories within which each business could own, and trade under, the Trade Marks (subject to express exceptions).

6. In 1987 a partnership, South Pacific Tyres (‘SPT’), was formed between one of Ansell’s predecessors, Pacific Dunlop Tyres Pty Ltd, and Goodyear Tyres Pty Ltd (a subsidiary of the Opponent). Each party held a 50% interest in the partnership. SPT’s business was the manufacturing, retreading and marketing of automotive and aircraft tyres, including under the Trade Marks. It ceased manufacturing aircraft tyres later that same year, although continued to manufacture tyres for trucks and other vehicles. It is declared that from the time it ceased to manufacture aircraft tyres SPT, through a subsidiary Tyre Marketers (Australia) Ltd (‘TMA’), continued to market and sell Dunlop and Flying D branded aircraft tyres which it purchased and imported from the UK business.

7. In 2006 the Opponent purchased the 50% share in SPT owned by Ansell. In doing so the Opponent became the owner of various assets including the Australian trade mark registrations identified above. It was recorded as the owner of the relevant registrations by virtue of their full or partial assignment[2] from Ansell.

   [2] Partial assignment occurs where ownership of a trade mark is assigned in respect of some only of the registered goods and/or services.

8. The factory at which Dunlop and Flying D branded vehicle tyres were manufactured was closed in 2008. Since that time no Dunlop and Flying D branded tyres have been manufactured in Australia, although the Opponent continues to manufacture such tyres for vehicles other than aircraft at its plants overseas which it then markets and sells in Australia (sales figures for some classes of those tyres are provided for the years 2006 to 2011).

9. In 2009 the Opponent closed the aircraft tyre retreading facility in Australia and declares to have shipped customer’s tyres offshore, at its own expense, for retreading since that time. It received an email from Mr. Pye, declarant for the Applicant, on 13 February 2009 in which he states that the “traditional arrangements” between the Australian and UK businesses were affected by factors including the upcoming closure of the Opponent’s retreading facility in Australia and that the UK business would shortly have its own retreading facility in the Asia Pacific region. To that end he seeks a license to use the Trade Marks or the transfer of their registration to the Applicant, and asserts that in a competitive situation the Applicant considered it would be entitled to use and register the Trade Marks itself in Australasia. Evidently the Opponent did not agree to this proposal, and its opposition to the applications (which had by then already been filed by the Applicant) brings us to the matter at hand.

10. A further point to note regarding the Opponent’s evidence is that it shows many examples of use of the Dunlop word mark and Flying D device during earlier years, but not so in the years immediately leading up to the filing date of the applications. The most recent annual report in evidence is from 2001: it is in respect of ‘Pacific Dunlop’ (as Ansell was then called) and the products that it sold under brands including Dunlop. The only other example, pre-filing date, is a confidential invoice dated 2008 and it arguably does not show trade mark use of the name Dunlop (the invoice is headed “Goodyear Aviation” under which appears the by-line “A Division of Goodyear and Dunlop Tyres (Aus) Pty Ltd”). It is declared, however, that the invoice is in respect of Dunlop branded products. Post-priority date, the Opponent is able to provide more numerous examples of use including on its website and on an invoice dated 2012 which clearly does show use of the word Dunlop in fancy script and the Flying D device (and it declares that it has phased out the use of the name “Goodyear Aviation” and now heads its invoices with the Goodyear, Dunlop and Flying D trade marks). In March 2009 the Opponent also changed the name of its subsidiary TMA to Goodyear & Dunlop Tyres (Aust) Pty Ltd, which became the operating entity for the business in Australia.

11. The Opponent’s submissions characterise its relationship with the UK business as a conventional supplier relationship only. It states that it, not the Applicant, is the recognised commercial source of Dunlop and Flying D branded products and services and that it is the customer facing entity in Australia, and has been so for many years. To that end, despite the manufacturing of aircraft tyres having occurred in the UK from 1987, from the customer’s perspective the Opponent continued to trade in a seamless manner – the only thing having changed being the behind-the-scenes manufacturing arrangements. The Opponent states that it pays the costs of importing and marketing Dunlop and Flying D branded aircraft tyres and it sells them to the ultimate customers in Australia. It also honours the warranty on any products such that customers only ever deal with it in relation to a warranty claim. It also points to a further likelihood of confusion should the Applicant commence selling and retreading aircraft tyres under the Trade Marks: confusion which would arise due to customers’ association with the Opponent of Dunlop and Flying D branded tyres for vehicles other than aircraft.

The Applicant’s evidence

1. After disposal of the Australian business in 1899 the Dunlop Pneumatic Tyre Company continued to trade in the UK under the Dunlop name.

2. By around 1910 it started to manufacture aircraft tyres to supply the emerging aviation industry. In 1925 it formed a separate aviation division which included an aircraft tyre department.

3. In 1985 the aviation division was acquired by BTR PLC (‘BTR’). In 1996 BTR sold the aircraft tyre business to an entrepreneur, Mr Rene Charvillat, leading to the creation of the Applicant as a standalone company.[3]

   [3] It is declared that in 2007 the shares in the Applicant were acquired by its (unnamed) present owners, which appears to be AAC Capital Partners (according to the book referred to in paragraph 24).

4. BTR initially granted to the Applicant an exclusive license to use the Dunlop name and Flying D device in respect of aircraft tyres and retreading services, and then in 2008 assigned or partially assigned its relevant trade mark registrations of the DUNLOP word mark and the Flying D device to the Applicant. Those registrations are registered in the territories Gibraltar, Guernsey, Jersey and the UK.[4]

   [4] As at Pye 1, assignment of the registrations in Gibraltar and Jersey were still in the process of being recorded.

5. In respect of use of the Trade Marks, the Applicant declares that the DUNLOP word mark and the Flying D device are incorporated into the tyre mould so that the Trade Marks are visible throughout the life of the tyre. It also declares that the Dunlop name has been used in respect of aircraft tyres for more than 100 years. In 2010 a book was published by the Applicant to celebrate the centenary of “Dunlop Aircraft Tyres”, a copy of which is provided in evidence and shows numerous examples of the products and services to which the Trade Marks have been applied. The book also highlighted the future plans (as at 2010) of “Dunlop Aircraft Tyres”, including the opening of an aircraft tyre retreading and distribution centre in China (although manufacturing would continue to take place only at the Applicant’s plant in the UK).

6. The Applicant provides information regarding the relevant market for aircraft tyres and retreading. As opposed to vehicle tyres, the market for aircraft tyres and retreading is a specialist and highly regulated industry and customers are generally aircraft manufacturers (such as Boeing or Embraer) and airline operators (such as British Airways or Qantas). Aircraft must meet certain standards of airworthiness before they can be issued with a ‘Type Certificate’, which enables the aircraft to be operated. The Type Certificate covers both the design of the aircraft and all of its major parts. Aircraft tyres are one of the major parts and as such are ‘Type Certified’ products, effectively becoming the prescribed tyre for that particular model of aircraft.

7. Once an aircraft has received a Type Certificate, it may be operated by an airline in accordance with maintenance documentation. The identity and location, or vendor code, of the aircraft tyre manufacturer may be listed in that documentation. Additionally, before an aircraft operator can install tyres on an aircraft it must sight the ‘Authorised Release Certificate’ for the specific tyre to be installed. The Authorised Release Certificate verifies that the tyre is airworthy, and confirms the name and address of its manufacturer (or retreader in the case of retreaded tyres). Each tyre, whether it is supplied to different airlines or operators, is accompanied by a copy of the Authorised Release Certificate. Accordingly, each recipient of new tyres will receive documentation that identifies the Applicant as the source of the tyre (since the Opponent ceased to manufacture aircraft tyres itself in 1987).

8. It is in this context that the Applicant markets its products by directing its efforts towards aircraft manufacturers to persuade them to adopt the Applicant’s products or to work with the Applicant to develop bespoke products. Its marketing efforts include participation in numerous conferences and trade fairs, exhibit stands at trade fairs, and direct contact via discussions and meetings. In this way the Applicant’s tyres can become those that are approved for use with the particular model of aircraft, and the Applicant identified as the source of the tyre in the accompanying documentation. At the same time, since there are no major aircraft constructors in Australia the Applicant declares it does not undertake any significant marketing initiatives in the region.

9. The Applicant characterises the sale of Dunlop branded products around the world as being sales made historically through subsidiary companies, and sales made in Australia, since the closure of the Opponent’s manufacturing facility, as being sales of its products through a distributor (the Opponent) - albeit with no formal, written agreement. It declares that despite the involvement of the Opponent, the airlines and operators always knew the true identity and manufacturing origin of the tyres because of their unique certification requirements. It provides sales figures for tyres sold to Australian customers for the years 2000 to 2009 (although other than two unexplained discrepancies, these are comprised entirely of sales made to the Opponent), and claims that another distributor (BAe Systems) has sold the Applicant’s products in Australia (although the Opponent declares that these sales were pursuant to a contract between BAe Systems and the Commonwealth Government to maintain the Royal Australian Air Force, made with the Opponent’s knowledge and consent).

10. In respect of retreading services the Applicant declares that it has not been able to offer a retreading service directly to customers in Australia because it did not have a facility in the region to do so. Rather the Opponent provided such services and, since the involvement of Goodyear with the Opponent’s predecessors, it has marked the tyre retreads with its own name to make clear that it had retreaded them (although the Opponent points out that such retreading must, and does, leave the original Trade Marks unobscured). The Applicant declares that so far as it is aware neither the Opponent nor any other party had for the past ten years offered or provided re-treading services for aircraft tyres in Australia under the Trade Marks. It goes on to state that now it has a facility in China, it is able to offer Australian operators retreading services at a competitive price.

1. The Applicant has occasionally had contact with Australian customers. It provides examples of two email exchanges (pre-priority date) with Australian airline operators, one which enquires about wear patterns on tyres and the other which advises about the standardisation of a particular aircraft part across two aircraft models. It claims to also have met with representatives from Australian airlines at conferences and trade shows over the years including Virgin Australia, Qantas, Ansett and REX, although where years are given for these meetings they occur after the priority date.

2. As to the Opponent’s promotion of the Trade Marks, the Applicant declares that it is not aware of the Opponent ever having displayed promotional materials in respect of products or services it provides under the Trade Marks at trade fairs and conferences. The Applicant also provides various pages from the Opponent’s website which do not refer to the Trade Marks, a fax cover page from Mr. Monaghan which does not display the Trade Marks, and various pieces of promotional material published by the Opponent (from 1998, 2001 and 2004) which do not display the Trade Marks.

3. Early in 2013 the Applicant appointed an independent Australian distributor for its aircraft tyres, and in the ensuing correspondence between the parties the Applicant again asserts that it has legitimate rights to develop its business in Australia. It has also, since filing the applications, distributed a promotional CD to a number of Australian airline operators and evidently written to Australian based customers advising of its new Australian distributor.

4. The Applicant’s submissions focus particularly on the change in circumstances arising in 1987, whereby it became the sole manufacturing source of aircraft tyres displaying the Trade Marks. It contends that such a change was not merely behind-the-scenes, particularly because the relevant market is required to have a heightened awareness of the source of its products. Given the long period of alleged non-use or de minimis use by the Opponent in respect of aircraft tyres, the Applicant contends that the Opponent has abandoned the Trade Marks or otherwise acquiesced in the Applicant’s use of them. It also emphasizes that the aircraft tyre market is quite distinct to that of other vehicle tyres: it is highly regulated in comparison to vehicle tyres and the purchasers of aircraft tyres are comprised of aircraft manufacturers, airline operators, military forces and distributors.

Grounds and onus

1. The Opponent pressed the grounds of opposition under sections 42(b), 44, 58, 60, 62(b) and 62A of the Act in respect of both applications. It also pressed the ground under section 58A in respect of the application for the word mark DUNLOP. For completeness I find that none of the remaining grounds have been established.

2. I proceed on the basis that the Opponent bears the onus of establishing at least one of the grounds on the ordinary civil standard of the balance of probabilities[5] and that the date at which the rights of the parties are to be determined is the date the applications were filed[6], being 23 January 2009.

   [5] Pfizer Products Inc v Karam [2006] FCA 1663; (2000) 70 IPR 599 per Gyles J at [6] to [26].

   [6] Southern Cross Refrigerating v Toowoomba Foundry Pty Ltd [1954] HCA 82; (1954) 91 CLR 592 at 595.

3. The primary grounds argued were those under sections 44 and 58 of the Act and whether the provisions of subsection 44(3)(b) ought to be applied (including in respect of section 58) to allow the applications to proceed to registration.[7]

   [7] The Applicant advised that it did not rely upon subsection 44(4), and it did not make submissions in respect of 44(3)(a).

4. As will become clear, I consider that the Opponent has established both prior statutory rights and prior common law rights. To that end I discuss the grounds under sections 44 and 58 only briefly in order to focus on the question of whether the provisions of subsection 44(3)(b) ought to be applied.

Section 44

1. Section 44 of the Act provides:

Identical etc. trade marks

44.(1) Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant's trade mark) in respect of goods (applicant's goods) must be rejected if:

(a) the applicant's trade mark is substantially identical with, or deceptively similar to:

(i) a trade mark registered by another person in respect of similar goods or closely related services; or
(ii) a trade mark whose registration in respect of similar goods or closely related services is being sought by another person; and

(b) the priority date for the registration of the applicant's trade mark in respect of the applicant's goods is not earlier than the priority date for the registration of the other trade mark in respect of the similar goods or closely related services.

Note 1:  For deceptively similar see section 10.

Note 2:  For similar goods see subsection 14(1).
Note 3:  For priority date see section 12.

(2) Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant's trade mark) in respect of services (applicant's services) must be rejected if:

(a) it is substantially identical with, or deceptively similar to:

(i) a trade mark registered by another person in respect of similar services or closely related goods; or
(ii) a trade mark whose registration in respect of similar services or closely related goods is being sought by another person; and

(b) the priority date for the registration of the applicant's trade mark in respect of the applicant's services is not earlier than the priority date for the registration of the other trade mark in respect of the similar services or closely related goods.

Note 1: For deceptively similar see section 10.

Note 2:  For similar services see subsection 14(2).
Note 3:  For priority date see section 12.

(3) If the Registrar in either case is satisfied:

(a) that there has been honest concurrent use of the 2 trade marks; or
(b) that, because of other circumstances, it is proper to do so;

the Registrar may accept the application for the registration of the applicant's trade mark subject to any conditions or limitations that the Registrar thinks fit to impose. If the applicant's trade mark has been used only in a particular area, the limitations may include that the use of the trade mark is to be restricted to that particular area.

Note:  For limitations see section 6.

(4) If the Registrar in either case is satisfied that the applicant, or the applicant and the predecessor in title of the applicant, have continuously used the applicant's trade mark for a period:

(a) beginning before the priority date for the registration of the other trade mark in respect of:

(i) the similar goods or closely related services; or
(ii) the similar services or closely related goods; and

(b) ending on the priority date for the registration of the applicant's trade mark;

the Registrar may not reject the application because of the existence of the other trade mark.

Note 1:  An authorised use of the trade mark by a person is taken to be a use of the trade mark by the owner of the trade mark (see subsection 7(3)).

Note 2:  For predecessor in title see section 6.
Note 3:  For priority date see section 12.

1. There was no contention that the Opponent was not the owner of prior registrations for identical trade marks that are in respect of goods and services encompassing those of the subject applications.

2. I confirm that I consider the ground to be established on the basis of the trade marks identified in paragraph 8 of these reasons, which include: registration 9344 which is for the plain word DUNLOP in respect of pneumatic tyres (other than those for bicycles and wheeled toys) and dated 1910; registration 1125858 which is for the plain and stylised word DUNLOP in respect of retreading of tyres and repair of damaged tyres and dated 1990; registration 1125812 which is for the Flying D device in respect of tyres and tubes and dated 1965; and registration 1125856 which is for the Fyling D device in respect of retreading of tyres and repair of damaged tyres dated 1990.[8]

   [8] These are not the full statements of goods and services.

3. Accordingly the ground of opposition under section 44 is established.

Section 58

1. Section 58 of the Act provides:

   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.

2. In order to succeed under this ground of opposition, the Opponent must establish that:

   ·     The respective trade marks of the Applicant and Opponent are either identical or substantially identical[9];

   ·     The respective good and services of the parties are the ‘same kind of thing’[10]; and

   ·     The Opponent’s trade mark use was prior to both the application to register and any actual use of the trade mark in Australia by the Applicant[11].

   [9] Carnival Cruise Lines Inc. v Sitmar Cruises Ltd [1994] FCA 936; (1994) ALR 495.

   [10] Re Hicks’ Trade Mark (1897) 3 ALR 75

   [11] Settef SpA v Riv-Oland Marble Co (Vic) Pty Ltd (1987) 10 IPR 402

3. The evidence establishes that the trade marks used by the parties are identical and that the use has been in relation to the same goods and services.

4. I am satisfied from the evidence that the Opponent used the Trade Marks in Australia prior to the Applicant. Although the very early history of trade is not precisely clear, I am satisfied that by at least the early 20^th century the Opponent’s predecessors were operating as entities independent of the UK business. I note that the Dunlop Pneumatic Tyre Company of Australasia was a company that existed in Australia prior to 1905 (during which year it was deregistered). An article in the Brisbane Courier-Mail from 1937 refers to the Opponent’s predecessor and the “332 Sizes and Types of Tyres” it produced to meet Australia’s transport demands. An extract from the 1940 Annual Report for the Dunlop Perdriau Rubber Company Ltd (another of the Opponent’s predecessors) features ranges of tyres including for aircraft. Numerous further examples from the 1940’s and later years are in evidence. Similarly, the confidential trade agreements in evidence refer to earlier agreements having regulated the relationship between the Australian and UK businesses since the UK business disposed of the Australian arm.

5. Additionally, although trade mark registrations do not necessarily establish rights for the purposes of section 58, I note that Australian entities have held the statutory rights to the DUNLOP word mark since 1910 and the Flying D device since 1965. This would represent an extremely long period of either ignorance or acquiescence if it was the case that the Applicant was the first user and was trading in Australia itself. Such a scenario is unlikely.

6. Accordingly, I am satisfied that the Opponent used identical trade marks in respect of goods and services which are the same, or same kind of thing, as those specified in the applications and that the Opponent’s use was prior to both the filing date of the applications and the instances of claimed use in Australia by the Applicant. The ground of opposition under section 58 is therefore established.

7. Having found that grounds of opposition are established, the onus shifts to the Applicant to satisfy the Registrar that the Trade Marks should, nevertheless, be registered. The Applicant relies upon subsection 44(3)(b): that ‘other circumstances’ exist which would make registration proper, and/or that any superior title the Opponent may have had to ownership of the Trade Marks has been lost by way of abandonment or acquiescence.

Subsection 44(3)(b)

1. As stated above, subsection 44(3)(b) of the Act provides:

   (3) If the Registrar in either case is satisfied:

   …
   (b) that, because of other circumstances, it is proper to do so;

   the Registrar may accept the application for the registration of the applicant's trade mark subject to any conditions or limitations that the Registrar thinks fit to impose. If the applicant's trade mark has been used only in a particular area, the limitations may include that the use of the trade mark is to be restricted to that particular area.
   Note:  For limitations see section 6.

2. The range of circumstances to which the Registrar may have regard in the consideration of subsection 44(3)(b) is not limited, other than that they make acceptance or registration of the Trade Marks proper.

3. As a starting point, and as acknowledged by the Applicant, it appears that the circumstances ought to be those that existed as at the priority date (and therefore post-priority date use should not be taken into account). In this regard, Lander J commented in Hills Industries Limited v Bitek Pty Ltd[12]:

   As I have mentioned, Hills claimed that the “other circumstances” referred to in s 44(3) must be circumstances that existed as at the priority date. It think that is probably so, although there is something in the argument put by Bitek that the circumstances should not be confined to those prior to the priority date because s 44(3)(b) does not in terms say so. I think however, on balance, that s 44 in general assumes an inquiry as at the priority date and as was said in Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd 91 CLR 592 at 595, “the rights of the parties are to be determined as at the date of the application”.

   For that reason, I would confined the question of the exercise of the discretion under s 44(3)(b) to those circumstances which prevailed prior to the priority date.

   [12] (2011) 90 IPR 337; [2011] FCA 94, at [177], a position Dodds-Streeton J thought to have force in Tivo Inc v Vivo Corporation Pty Ltd [2012] FCA 252 (not canvassed in the appeal to the Full Federal Court).

4. The Applicant submitted that there are eight groups of circumstances that supported the application of subsection 44(3)(b). They are:

   ·     The use of the Trade Marks upon aircraft tyres has been use by the Applicant in Australia. From 1987 the only tyres sold in Australia have been those manufactured by the Applicant, and prior to then the Opponent imported certain models of tyres that the Applicant manufactured. The Applicant submits there is no agreement in place which provides for the use of the Trade Marks by the Applicant enuring to the benefit of the Opponent.

   ·     From 1987 the Trade Marks have not been used in relation to any aircraft tyres manufactured or retreaded by the Opponent. The Opponent has applied the ‘Goodyear’ trade mark to tyres it retreads, even where the tyre is a Dunlop branded tyre. Nor have the Trade Marks been used upon invoices: the 2008 invoice shows use of the word Dunlop as part of a company name, not a trade mark, and the 2012 invoice is after the priority date.

   · As a matter of fact, leaving aside the legal question of whose trade mark use it is, the use of the Trade Marks on aircraft tyres in Australia unquestionably indicates that it is the Applicant who is the manufacturer. This is reinforced by the specialised nature of aircraft tyres and retreading and the regulation that applies to them. It is therefore impossible for any purchaser to be in doubt as to who manufactured the tyres: the Trade Marks act as badges of origin for the Applicant – those who purchase them are customers because Dunlop tyres are mandated for those aircraft. Accordingly the change in 1987 (when the Opponent cease manufacturing such tyres and imported them from the UK business) was not merely behind-the-scenes. Customers knew they were getting tyres manufactured by the Applicant and the Opponent is therefore not recognised in Australia as their commercial source.

   ·     As a matter of law, the use of the Trade Marks is trade mark use by the Applicant in Australia, per E&J Gallo Winery v Lion Nathan Australia Pty Ltd (‘Gallo’)[13]. In Gallo it was found that use by an overseas owner of a trade mark is use by that owner in Australia, which is not reliant on whether the use is by the registered owner or not (as contended by the Opponent). Here, the Trade Marks continue to function as badges of origin of the Applicant.

   ·     Mere distribution of Dunlop and Flying D branded tyres do not amount to trade mark use by the Opponent. The Opponent has not used the Trade Marks since 1987 to distinguish its goods from others: it has not marketed them at exhibits (at least, not to Mr. Pye’s knowledge and Mr. Monaghan doesn’t dispute that) and its invoices did not display the Trade Marks until after the priority date.

   ·     The Applicant’s use of the Trade Marks has not and will not cause confusion. It has used the Trade Marks in Australia for a very long time, including exclusively for the past 27 years, with no confusion arising. If the Applicant was granted registration and supplies goods directly to Australian customers through a new Australian distributor, customers will simply appreciate they’re being supplied goods from the same source via a different route. This scenario is unlikely to give rise to confusion. Even though the Opponent uses the Trade Marks on vehicle tyres, those tyres are sold through entirely different trade channels so there is no possibility of confusion (and none has arisen to date). In contrast, if the Opponent were to start manufacturing aircraft tyres under the Trade Marks it would cause confusion in the aircraft tyre industry because since 1987 it has only applied Goodyear trade marks to tyres it manufactures and retreads.

   ·     The Opponent’s opposition is motived by a desire to “sterilise” the use to the Trade Marks in Australia. The Opponent itself makes no use of them, it only distributes such tyres to customers whose aircraft require them. The Opponent’s principle business is to manufacture a competing range of tyres. In that commercial setting, the Opponent’s obvious purpose is to sterilise the use of the Trade Marks in Australia by maintaining their monopoly over them and preventing another entity from actively promoting a range of goods which competes with their own.

   ·     The relative inconvenience to the parties favours allowing registration. The consequence of refusal may be to prevent the Applicant from distributing its goods in Australia other than through a competitor. On the other hand, there is no real inconvenience to the Opponent in allowing registration. It wouldn’t affect the Opponent’s own registrations and in any event the Opponent doesn’t itself make any use of the Trade Marks.

   [13] [2010] HCA 15; (2010) 241 CLR 144.

5. The Applicant further submitted that section 58 was subject to subsection 44(3) because subsection 44(3) was evidently intended to confer on the Registrar a broad discretion to register a mark even where it was not first used by an applicant. It submitted that there was nothing in the terms of subsection 44(3) which says that use must be prior to the conflicting mark. If a mark has been first used by an applicant after another person first used a conflicting mark, then the owner of the mark will generally always be the owner of the conflicting mark. If section 58 was not subject to subsection 44(3), then subsection 44(3) would have little work to do.

6. For its part, the Opponent submits that its use of the Trade Marks in Australia does not inure to the Applicant. It submits that Gallo is not a binding authority because it speaks of the registered owner and because in that case goods were released onto the “sea of commerce”, going all around the world and with some ending up in Australia. Here, there is a deliberate customer-supplier relationship. The Opponent submits it would be a misapplication of Gallo to find that by virtue of the Opponent changing its manufacturing arrangements the benefit of trade mark use inured to the Applicant, and it would further be a surprising application of trade mark law to a toll manufacturing arrangement (one which would transfer decades of rights that the Opponent holds to the Applicant).

7. The Opponent further submits that the question of whether section 58 is subject to subsection 44(3)(b) is immaterial because the instances of use and other circumstances relied upon by the Applicant are inadequate for the application of those provisions. Notwithstanding that, the analysis in McCormick & Co v McCormick (‘McCormick’)[14] applies, in a structural sense, to section 58. Additionally section 58 has a narrow operation, intending to act as a filter for marks that are identical or substantially so, used in respect of the same kind of thing. In contrast subsection 44(3) is designed to permit some tolerance for confusion by reason of honesty of adoption. However section 58 is intended to deal with marks that are simply too close for the application of that doctrine – had the legislature meant otherwise it would have been a simple matter to make clear that s58 was subject to subsection 44(3), but it has not done so.

   [14] [2000] FCA 1335; (2000) 51 IPR 102.

1. Although I am, to a degree, sympathetic to the Applicant’s position, I do not consider that the factors supporting registration outweigh those supporting refusal, and accordingly I am not satisfied that it is appropriate to apply the provisions of subsection 44(3)(b).

2. Firstly, there is a long commercial history between the Australian and UK businesses in respect of the trade of Dunlop and Flying D branded tyres in Australia, governed by agreements entered into by the Applicant’s and Opponent’s predecessors. For this reason, in particular, I do not find that Gallo provides great assistance. Although Gallo does find that the trade mark of an overseas manufacturer does not cease to function as a badge of origin when those goods are offered for sale and sold in Australia, the considerations are in the context of an overseas manufacturer unknowingly trading in Australia. Here, the question is not whether there is use of the Trade Marks by the registered owner, but rather to whom the benefit of use inures in the context of a long-term division of ownership between the Australian and UK businesses. I am not persuaded that the affixing of the Trade Marks to aircraft tyres by the Applicant, even as the sole entity doing so since 1987, trumps the long term ownership and prior trade under the Trade Marks by the Opponent and its predecessors.

3. Secondly, the Applicant has chosen to pursue registration of the Trade Marks in its name with full knowledge that they are owned in Australia by the Opponent. The reasons for it choosing to pursue registration under its own name rather than seek removal of the Opponent’s marks, in respect of aircraft tyres and retreading, are not clear to me. Possibly, and understandably, the long history between the parties and the Opponent’s continuing use in respect of vehicle tyres might cast doubt on the success of such an action (nor is it actually established that the Opponent has not used the Trade Marks since 1987 - the Opponent not having prepared its evidence to answer a removal action). Nevertheless knowing entrance into a market wherein statutory rights are clearly held by the Opponent, and long held common law rights are not shown to have been lost by the Opponent, speaks against the appropriateness of finding other circumstances exist which favour the Applicant.

4. Additionally, I bear in mind that the value of trade marks is dependent upon the monopoly they afford. To find that the Trade Marks ought to be registered in the Applicant’s name would devalue, at least to some extent, the registrations held by the Opponent and potentially harm its position in the conduct of its business negotiations.

5. For these reasons, I do not consider it appropriate to apply the provisions of subsection 44(3)(b) to allow registration of the Trade Marks. This is so regardless of whether they are considered in the context of section 44 or section 58. In respect of whether section 58 is subject to subsection 44(3)(b), there are no judicial cases which explore this question and only few decisions by the Registrar which discuss somewhat similar questions. Kenny J in McCormick discussed whether section 60 was subject to subsection 44(3), stating:

   [T]he structure of the Act and the provisions with which this appeal is concerned differ markedly from the 1955 Act. Parts 4 and 5 of the Act relate to separate stages in the registration process. The reasoning that led Mason CJ, Dawson, Toohey and Gaudron JJ [in New South Wales Dairy Corporation v Murray Goulburn Co-Operative Company Ltd [1990] HCA 60; (1990) 171 CLR 363] to hold that s 28 was subject to s 34 of the 1955 Act does not apply under the new Act. Within Division 2 of Part 4, s 44(1) provides for a ground for rejecting an application before acceptance by the Registrar. Subsection 44(1) expressly states that it is subject to s 44(3), the honest concurrent user provision. The whole of s 44 is expressed as an interlocking series of subsections. Section 60, which is part of a Division specifically setting out the grounds for opposing registration, is directed to the position after acceptance. Section 60 is not expressed to be subject to s 44(3), any analogous limitation, or even the Act generally: contrast s 89(1). On its face, it is a stand-alone provision. Furthermore, s 60 is apparently intended to afford a ground of opposition that is additional to the grounds set out in Part 4. Section 57 expressly states that the grounds of opposition may be "any of the grounds on which an application for the registration of a trade mark may be rejected under Division 2 of Part 4" (which includes s 44). Sections 58 to 62 add further grounds for opposition. On its face, there is no honest concurrent user exception to s 60.

6. Notwithstanding that Kenny J’s discussion is in respect of honest concurrent use provisions rather than other circumstances, the same analysis could be applied to section 58 of the Act. Prior to the introduction of section 58A the delegate in Milners Pty Ltd v PI-Design AG[15] noted that section 58 did not require continuous use and considered that it might be subject to subsection 44(4). Post the introduction of section 58A the delegate in Australian Broadcasting Corporation v Commercial Radio Australia Ltd[16] commented that subsection 44(3)(a) did not necessarily provide an adequate answer to a successful section 58 (although it might in terms of section 58A because 58A was intrinsically linked to section 44). The authors of Australian Trade Mark Law[17] discuss the nature of the exceptions under subsections 44(3) and (4) and conclude that they are not ‘floating exceptions’ to be applied outside of the scope of section 44 (and hence do not apply to section 58).

   [15] (2003) 59 IPR 577.

   [16] [2010] ATMO 46.

   [17] Burrell, R. and Handler, M., Melbourne: Oxford University Press, 2010.

7. Against this background I am inclined to think that section 58 is not subject to the provisions of subsection 44(3)(b), even were I satisfied that the other circumstances satisfied that exception. In the end, however, it is not necessary for me to make a finding in that regard.

8. Lastly, I do not consider either of the arguments in respect of abandonment or acquiescence are established. Abandonment requires not just “slightness of use” but also “some evidence indicating an intention to abandon the trade mark”[18]. Such is not the case here: even though the Opponent manufactures a competing range of aircraft tyres, it likewise does so in respect of vehicle tyres without any apparent desire to exclude the Dunlop brand from the market. I consider that its decision to cease manufacturing aircraft tyres could be due to the more onerous requirements for their production and its belief that it had an alternative production solution by importing such goods from the Applicant (rather than having to maintain or establish a new manufacturing facility itself). In respect of acquiescence the Applicant submits that the Opponent has acquiesced, and even assisted, the Applicant in using the Trade Marks in Australia by virtue of it importing the Applicant’s goods and selling them in the Australian market. This position, however, is not sustainable in light of the long standing commercial history that has existed between the parties and the fact that the argument can be reversed to posit that the Applicant has acquiesced to Opponent’s use of the Trade Marks in Australia over many previous decades.

   [18] Re Riv-Oland Marble Company (Vic) Pty Ltd v Settef SpA (1988) 19 FCR 569; [1988] FCA 344 at [9].

9. The Applicant does not pursue the exception under subsection 44(3)(a) and expressly states that it does not place reliance on subsection 44(4). Accordingly, there are no other exceptions to the section 44 and 58 grounds argued. Given I have found that it is not appropriate to apply the provisions of subsection 44(3)(b), the opposition is established. It is therefore not necessary for me to discuss the remaining grounds of opposition, although they (or any other grounds) may be argued in the event of an appeal.

Decision

1. Section 55 provided, at the date the applications were filed:

   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.

2. The Opponent has established a ground of opposition under the Act. I therefore refuse to register trade mark applications 1282093 and 1282094.

3. Costs generally follow the event, and given there is no apparent reason to depart from this principle I award costs against the Applicant per Schedule 8 of the Trade Mark Regulations 1995.

Nicole Worth
Hearing Officer
Trade Marks Hearings
5 February 2015