Gowan Crop Protection Limited v Nufarm Australia Limited
[2023] ATMO 79
•16 June 2023
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re:Opposition by Gowan Crop Protection Limited to application under section 92 of the Trade Marks Act 1995 (Cth) by Nufarm Australia Limited to remove trade mark number 2101679 (5) - AVADEX - in the name of Gowan Crop Protection Limited
Delegate: | Louise Tuohy |
Representation: | Opponent: Andrew Fox of Senior Counsel instructed by Holding Redlich Lawyers Applicant: Benjamin Fitzpatrick of Counsel instructed by Arcadia Intellectual Property Lawyers |
Decision: | 2023 ATMO 79 Trade Marks Act 1995 (Cth) – application under section 92 – section 92(4)(a) application for removal – intention in good faith to use or authorise use found – trade mark to remain on the Register |
Background
Gowan Crop Protection Limited (‘Removal Opponent’) is the registered owner of the following trade mark:
Registration Number: 2101679
Trade Mark: AVADEX (‘Trade Mark’)
Filing Date: 7 July 2020
Specification: Class 5: Agricultural pesticides (‘Registered Goods’)
On 12 March 2021 Nufarm Australia Limited (‘Removal Applicant’) filed an application (‘Application’) seeking removal of the Trade Mark from the Register for non-use. The Application was in respect of all the Registered Goods.
On 5 May 2021 the Removal Opponent filed a Notice of Intention to Oppose the removal of the Trade Mark, followed by its Statement of Grounds and Particulars (‘SGP’) on 7 June 2021. On 23 July 2021 the Removal Applicant filed its Notice of Intention to Defend the Application.
The Removal Opponent filed the following declaration as evidence in support:
Declaration of Martin Robert Dargan, Director of Gowan Crop Protection Australia Pty Ltd, a subsidiary of the Removal Opponent, made on 25 October 2021, with Exhibits GCP-01 to GCP-04 (‘Dargan 1’).
The Removal Applicant filed the following declaration as evidence in answer:
Declaration of Stuart Bradshaw, Global Counsel IP at the Removal Applicant, made on 28 January 2022, with Annexures SB-1 to SB-64 (‘Bradshaw’).
The Removal Opponent filed the following declarations as evidence in reply:
Declaration of Jacqueline Therese Plunkett, Senior Associate at Holding Redlich Lawyers Australia Limited, made on 4 April 2022, with Exhibits JTP-01 to JPT-04 (‘Plunkett’).
Declaration of Martin Robert Dargan, made on 27 May 2022, with Exhibits MRD-01 to MRD-07 (‘Dargan 2’).
Once time for filing evidence had ended, both parties requested to be heard. As a delegate of the Registrar of Trade Marks, I heard the matter on 5 April 2023, by way of video conference. Andrew Fox of Senior Counsel instructed by Holding Redlich Lawyers appeared for the Removal Opponent. Benjamin Fitzpatrick of Counsel instructed by Arcadia Intellectual Property Lawyers appeared for the Removal Applicant. Oral submissions were supplemented by the parties’ written submissions filed prior to the hearing.
Legal Framework
Part 9 of the Trade Marks Act 1995 (Cth) (‘Act’) deals with removal of trade m arks from the Register due to non-use.
The Removal Applicant nominated s 92(4)(a) of the Act as the ground for removal. Section 92(4)(a) provides:
(4) An application under subsection (1) or (3) (non‑use application) may be made on either or both of the following grounds, and on no other grounds:
(a) that, on the day on which the application for the registration of the trade mark was filed, the applicant for registration had no intention in good faith:
(i) to use the trade mark in Australia; or
(ii) to authorise the use of the trade mark in Australia; or
(iii) to assign the trade mark to a body corporate for use by the body corporate in Australia;
in relation to the goods and/or services to which the non‑use application relates and that the registered owner:
(iv) has not used the trade mark in Australia; or
(v) has not used the trade mark in good faith in Australia;
in relation to those goods and/or services at any time before the period of one month ending on the day on which the non‑use application is filed;
The onus of rebutting an allegation made under s 92(4)(a) lies with the Removal Opponent. This onus is pursuant to s 100 of the Act which provides:
100 Burden on opponent to establish use of trade mark etc.
(1) In any proceedings relating to an opposed application, it is for the opponent to rebut:
(a) any allegation made under paragraph 92(4)(a) that, on the day on which the application for the registration of the trade mark was filed, the applicant for registration had no intention in good faith:
(i) to use the trade mark in Australia; or
(ii) to authorise the use of the trade mark in Australia; or
(iii) to assign the trade mark to a body corporate for use by the body corporate in Australia;
in relation to the goods and/or services to which the opposed application relates (relevant goods and/or services); or
(b) any allegation made under paragraph 92(4)(a) that the trade mark has not, at any time before the period of one month ending on the day on which the opposed application was filed, been used, or been used in good faith, by its registered owner in relation to the relevant goods and/or services; or
[…]
(2) For the purposes of paragraph 1(b), the opponent is taken to have rebutted the allegation that the trade mark has not, at any time before the period referred to in that paragraph, been used, or been used in good faith, by its registered owner in relation to the relevant goods and/or services if:
(a) the opponent has established that the trade mark or the trade mark with additions or alterations not substantially affecting its identity, was used in good faith by its registered owner in relation to those goods or services before that period; or
(b) in a case where the trade mark has been assigned but a record of the assignment has not been entered in the Register:
(i) the opponent has established that the trade mark, or the trade mark with additions or alterations not substantially affecting its identity, was used in good faith by the assignee in relation to those goods or services before that period and that that use was in accordance with the terms of the assignment; and
(ii) the Registrar or the court is of the opinion that it is reasonable, having regard to all the circumstances of the case, to treat the use of the trade mark by the assignee before that period as having been a use of the trade mark in relation to those goods or services by the registered owner.
In the present case the Removal Opponent relies on its intention in good faith to use and/or authorise use of the Trade Mark in Australia in respect of the Registered Goods as at the filing date of the Application on 7 July 2020 (‘Relevant Date’).
I proceed on the basis that the burden of proof is the ordinary civil standard of the balance of probabilities.[1]
[1] Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133] (Besanko, Jagot and Edelman JJ), albeit in respect of an action opposing registration rather than removal.
In accordance with s 101 of the Act, if the grounds for removal are established, I may decide to remove the Trade Mark from the Register in respect of any or all of the Registered Services, or, if satisfied it is reasonable to do so, decide not to remove the Trade Mark from the Register.
Discussion
The Removal Applicant is an entity controlled by Nufarm Limited which is headquartered in Melbourne, Australia. Nufarm Limited is a global crop protection and seed technology company, with a history of more than 100 years. Nufarm Technologies USA Pty Ltd (‘Nufarm Technologies’) is another entity controlled by Nufarm Limited and is the holder of a number of Australian trade mark registrations.
The Removal Opponent is a global agricultural solution business which is headquartered in the United States of America. The Removal Opponent specialises in developing, marketing, and processing agricultural inputs such as crop protection products, seeds, and fertilisers. The Removal Opponent was founded in 1962 and has a presence in the majority of agricultural regions globally.
Background to the AVADEX trade mark
The Removal Applicant submits that on 29 November 1960, the Monsanto Company applied to register the AVADEX trade mark (‘1960 AVADEX trade mark’) in Australia for pesticidal preparation, including preparations for destroying or controlling weeds in class 5.
The application was subsequently registered under the Trade Marks Act 1955 (Cth) in Part A and assigned Registration number 163878. The 1960 AVADEX trade mark was then assigned to Monsanto Technology LLC.
On 14 June 2002 pursuant to a Sale Agreement dated 28 March 2002, Monsanto Technology LLC assigned its Australian and New Zealand ‘tri-allate intellectual property assets’ including the 1960 AVADEX trade mark to Nufarm Technologies.[2] Nufarm Technologies was recorded as the registered owner of the 1960 AVADEX trade mark on 3 October 2002.
[2] Bradshaw, [16], [Annexure SB-6].
Since 2002, the Removal Applicant used the 1960 AVADEX trade mark in Australia, under licence from Nufarm Technologies, [3] for its registered goods containing tri-allate. Tri-allete is the name for the active ingredient used in weed control products. The Removal Applicant sourced the tri-allate from Monsanto and this continued until 2016. On 14 September 2016 the Removal Applicant then entered into a Supply Agreement (‘SA’) with the Removal Opponent to supply the tri-allate technical 94% product,[4] which the Removal Applicant then formulates, packages and sells in Australia under the 1960 AVADEX trade mark.
[3] Bradshaw, [17], [Annexure SB-8].
[4] Bradshaw, [32].
In Dargan 1, Mr Dargan declares the as part of a 2004 definitive agreement between Monsanto and the Removal Opponent, the Removal Opponent acquired the tri-allate formulation and the remainder of Monsanto’s international rights in the AVADEX trade mark. However, it should be noted that the Removal Applicant up until the signing of the SA continued to source the tri-allete from Monsanto. Mr Dargan also declares that the Removal Opponent is the owner of over 30 trade mark registrations in foreign jurisdictions incorporating the word AVADEX,[5] and that it currently licences the Trade Mark in other international markets.
Removal of the 1960 AVADEX trade mark from the Trade Marks Register
[5] Dargan 1, [7], [Exhibit GCP-01].
In Bradshaw, Mr Bradshaw declares that the Removal Applicant’s 1960 AVADEX trade mark was due for renewal on 29 November 2019, with a six month grace period expiring on 29 May 2020.[6]
[6] Plunkett, [9].
On 22 January 2019 Mr Bradshaw undertook the task of renewing all of the Removal Applicant’s Australian trade marks which the Removal Applicant’s portfolio manager had requested be renewed. Mr Bradshaw claims that because of the transaction limited on his corporate credit card, he had to split the renewals into two batches from A-D and E-Z.[7] Mr Bradshaw claims that following the completion of this task, he ignored any lapsing alerts from IP Australia as there were often a large volume of abandoned trade marks.
[7] Bradshaw, [43], [Annexure SB-32].
On 1 March 2021 the Removal Applicant’s portfolio manager queried the lapsing of a trade mark which he had asked to be renewed. At this time Mr Bradshaw checked the other Australian trade mark renewals for 2019 including the Trade Mark. Mr Bradshaw discovered that the credit card transaction for the first batch from A-D did not go through.
On 3 March 2021 the Removal Applicant immediately instructed its Attorneys to refile the trade marks that were in the first batch. The Removal Applicant’s Attorney filed an application for the ADADEX trade mark on 12 March 2021.
In Dargan 2, Mr Dargan declares that on 25 June 2020 he was informed by the former United States head office Intellectual Property Manager, Annette Bay, that the Removal Applicant did not renew the 1960 AVADEX trade mark.[8]
[8] Dargan 2, [26], [Exhibit MRD-08].
On 7 July 2020, the Removal Opponent filed the Application to Register the Trade Mark for the Registered Goods.
Intention to Use
Although the onus is, in terms of s 100, on the Removal Opponent in this matter, that onus in not particularly arduous. In Aston v Harlee Manufacturing Co, Fullagar J observed:
[…] the making of the application itself is, I think, to be regarded as prima facie evidence of intention to use. I cannot think that the Registrar is called upon to institute an inquiry as to the intention of any applicant, and I think that, on … a motion to expunge, the burden must rest on … the person aggrieved, of proving the absence of intention. Again, I do not think that “intention” in this connexion ought to be regarded as meaning an intention to use immediately or within any limited time. [9]
[9] [1960] HCA 47; (1960) 103 CLR 391; [1960] ALR 605; 34 ALJR 242, [21].
While this observation was made in proceedings under the Trade Marks Act 1955 (Cth), where the onus was on ‘the person aggrieved’, the principle has been held to be sound under the Act. In Structureco Inc v Starite Distributors Pty Ltd, Delegate Forno observed:
Although the opponent to removal does bear the initial onus, in accordance with the legislation, I think that, in the case of applications for removal under s.92(4)(a), where the primary allegation regards the state of mind of an applicant for registration about whether it intends to use a mark in good faith, then that onus is not high. I believe that it is so low that it can be overcome if the opponent or its agent states that it was the case that the applicant for registration had an intention to use the mark in good faith. The onus should then shift to the removal applicant to support its case – perhaps by the production of some evidence which might support a circumstantial case of a lack of good faith, or by some other means.[10]
[10] [2000] ATMO 31.
In the SGP the Removal Opponent affirms that on the day on which the application for the registration of the Trade Mark was filed, it intended in good faith, to use the Trade Mark in Australia. Additionally, In Dargan 2, Mr Dargan declares that on the day on which the application for registration of the Trade Mark was filed, the Removal Opponent had a definite, bona fide intention to licence the Trade Mark to the Removal Applicant or if the Removal Applicant did not agree to such an arrangement, to a third party in the Australian Market.
The Removal Opponent has filed the application for trade mark registration, and made a clear statement that the Registrant had an intention in good faith to use or authorise use of the Trade Mark for commercial purposes in respect of the Registered Goods at the Relevant Date. Taken together, this is sufficient evidence to establish intention to use and to shift the onus from the Removal Opponent to the Removal Applicant. The question now is whether it was a good faith intention.
Good Faith
The Removal Applicant argues that the Removal Opponent’s motivation in filing the Trade Mark was to leverage the Trade Mark to secure a more favourable supply agreement.[11] Further the Removal Applicant argues that the Removal Opponent was fully aware of Monsanto’s divestment of its Australian and New Zealand triallate business in 2002, and of the Removal Applicant’s ongoing investment over several decades in Australia in the AVADEX brand and its ongoing goodwill and reputation in the 1960 AVADEX trade mark.
[11] Bradshaw [Confidential Annexure SB-34], see also Kevin Robinson v Little Wings Limited [2021] ATMO 11[11]a case where the owner affirmatively stated his good faith intention to use the trade marks the Delegate nonetheless found that on the filing date of the trade mark application, the owner was actuated not by a genuine trading interest, but by the ulterior purpose to use the trade mark to exert influence over others for financial and other gain, and thus had no intention in good faith to use the trade mark.
The meaning of ‘good faith’ in the context of Part 9 of the Act was considered in Epistar Corporation v RGB Link Pty Ltd and Delegate Worth observed:
52. The Registrar’s delegate, in Pierson’s Pro-Health Pty Ltd v Allan Sutton9 gave the following analysis of the expression ‘in good faith’ used in s 92(4)(a) of the Act:
[19] Under section 92, Drummond J in Woolly Bull Enterprises Pty Ltd v Reynolds10 found “the expression "use in good faith" has a well understood meaning in this context, viz, real, as opposed to token, use in a commercial sense.” In Edwards v Liquid Engineering 2003 Pty Ltd11 Gordon J stated (with emphasis added):
Having considered the evidence led, and submissions made, I was poised to answer that question in the affirmative and uphold the appeal, on the basis that "good faith" for the purposes of s 92(4) requires no more than genuine intent to use a mark for commercial purposes; it does not involve any element of honesty or subjective good intentions: see generally E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2008] FCA 934 at [187] - [192] (examining the meaning of "good faith" under related provisions of the TMA). However, during the course of the hearings it became apparent that what LE 2003 really wanted, and should have applied for in the first place, was the expungement of the registrations by Edwards under s 88 of the TMA on the basis that Edwards was not the owner of the unregistered marks: ss 52 and 58 of the TMA. I therefore delayed giving judgment in VID 934 of 2006 so that a separate application could be brought on that basis and the matters resolved together.
[20] The Full Federal Court in Liquideng Farm Supplies Pty Ltd v Liquid Engineering 2003 Pty Ltd12 upheld the above reasoning and said (emphasis added in bold):
Gummow J considered the meaning of the expression "use in good faith" as a criterion for infringement in Johnson & Johnson Australia Pty Ltd v Stirling Pharmaceuticals Pty Ltd (1991) 30 FCR 326 at 354, pointing out that:
There is, in relation to the comparable provisions in the British Act of 1938, authority to the effect that in order to qualify as such use there must be a real or genuine use in a commercial sense, rather than colourable activity and "token" use designed to lead trade rivals to think that the registered proprietor was using its mark in a way which gave it the protection of the legislation.
See also E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2008] FCA 934; [2008] 77 IPR 69 at [99] - [707] and the authorities there referred to.
We were directed to several other authorities which took a broader view of the expression but insofar as they conflict with the above authorities we do not consider they were correct.
In the present case having regard to the above authorities, we do not consider that her Honour erred when she observed at [8] of her reasons that s 92(4) of the Act requires no more than a genuine intent to use the mark for commercial purposes, and that the reference to bona fide intention to use is not sufficiently wide to encompass the circumstances of the present case.
[21] The High Court of Australia affirmed the interpretation of ‘in good faith’ in the decision of E & J Gallo Winery v Lion Nathan Australia Pty Ltd13 stating:
In "Concord" Trade Mark ("Concord"), Falconer J relied on Lawton LJ's summary of the findings in the Electrolux case in Imperial Group:
"According to the judgments given in this court in that case [Electrolux] a bona fide use should be 'ordinary and genuine' (per Lord Evershed MR at p 36), 'perfectly genuine', 'substantial in amount', 'a real commercial use on a substantial scale' (per Jenkins LJ at p 41) and not 'some fictitious or colourable use but a real or genuine use' (per Morris LJ at p 42)."
[22] The above reference to the expression ‘fictitious or colourable use’ arises from the comments of Morris LJ in Electrolux Ltd v Electrix Ltd14 who used it in this context:
The Legislature, in my view, had in mind that someone could not gain immunity from attack by asserting use when there was really only some fictitious or colourable use and not a real or genuine use.
….
It is, of course, clear that when the phrase “bona fide” is used, its context must be considered when deciding what is its meaning.
[23] Morris LJ stopped short of providing specific examples of ‘colourable use’, but the expression ‘fictitious or colourable’ has since been adopted in the British case of Imperial Group Ltd v Philip Morris & Co Ltd15 and (as seen above) in Gallo. In those instances it is employed in relation to use that cannot be described as real or genuine (or ‘bona fide’) including use manufactured solely to defeat an application for non-use. For the opponent’s use of the trade mark and its intention to be established as ‘colourable’ and not bona fide, it must have been for a purpose other than deriving profit and establishing goodwill16 in the course of trade.
Therefore, good faith for the purposes of s 92(4)(a) requires no more than use of the trade mark for ordinary commercial purposes generating profit and goodwill.[12] The elements of honesty and subjective good intentions do not inform whether the use, in terms of Part 9 of the Act, is in good faith. These matters and matters of ownership are more appropriately dealt with by an application to the courts to have the registration cancelled.
[12] See also Plus Technologies Pty Ltd v Swart & Sons Pty Ltd [2022] ATMO 156, [39] (Delegate Butson).
In the absence of any agreement between the parties in relation to how to use the Trade Mark, it appears that since the removal of the 1960 AVADEX trade mark from the Trade Marks Register and the registration of the Trade Mark by the Removal Opponent the parties have continued their respective tri-allate business and acted in accordance with the SA. Then on 19 March 2021 the Removal Applicant emailed the Removal Opponent regarding the Trade Mark. On 6 April 2021 the Removal Opponent responded to the email and offered the Removal Applicant a commercial deal for resolving the matter.[13]
[13]Bradshaw [Confidential Annexure SB-34].
The Removal Applicant has questioned the Removal Opponent’s motivations behind the deal. However the evidence does not show that the Removal Opponent’s intention at the Relevant Date was dedicated to some cause other than deriving profit and establishing goodwill in the Trade Mark. The Removal Opponent is a global agricultural solutions business and holds international rights to the AVADEX trade mark in 30 jurisdictions and licences the AVADEX trade mark in international markets. As the registered owner of the Trade Mark in Australia and supplier of tri-allate formula, the Removal Opponent was capable of entering into a commercial arrangement to licence the Trade Mark with a suitable operator.
Noting the low burden placed on the Removal Opponent in an application under s 92(4)(a) of the Act, I find that it has satisfied the onus in showing a good faith intention to use and/or authorise use of the Trade Mark for the Registered Goods. As such the grounds for removal under s 92(4)(a) of the Act have not been established in relation to the Registered Goods.
Decision
The Removal Applicant has been unsuccessful in its Application. I direct that trade mark registration 2101679 is to remain on the Register for all of the Registered Goods. If the Registrar is served with a notice of appeal within the relevant timeframe, I direct that the disposition of the Application should be in accordance with the Court’s order or direction.
Costs
Both parties sought costs. It is usual for costs to follow the event, and I see no reason to depart from that principle here. I award costs against the Removal Applicant under s 221 of the Act in line with Schedule 8 of the Trade Marks Regulations 1995 (Cth).
Louise Tuohy
Hearing Officer
Oppositions and Hearings
Trade Marks and Designs
16 June 2023
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