Grande Brasserie Alsacienne d'Adelshoffen, Re

[1996] ATMO 52

TRADE MARKS ACT 1995

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

Re:Trade Mark application 604242, in the name of Grande Brasserie Alsacienne d’Adelshoffen,  for registration of the words THE DIFFERENT STOUT

Grande Brasserie Alsacienne d’Adelshoffen is a French company of Schiltigheim, France.  On 9 June 1993 it applied, through its Perth patent and trade mark attorneys, Kelvin Lord and Company,  to register the words the  different  stout  for  brown and dark ales and beers.  The examiner of trade marks objected to the application.  In March 1994, and under the Trade Marks Act 1955, she issued a report stating that the words the  different  stout refer directly to the character and quality of the goods. They describe them as being different from other stouts. The words, she said, are words other traders are entitled to use to describe their ‘different’ stouts and therefore failed under the terms of section 24.

On 1 January 1996 the Trade Marks Act 1995 came into force and in the fourth report, issued in February 1996, the examiner explained that the objection raised under section 24 of the Trade Marks Act 1955 (the repealed Act) continued as a ground for rejection under section 41 of the Trade Marks Act 1995 (the new Act).  the  different  stout, she said, is not sufficiently adapted to distinguish the applicant’s goods from stouts which other traders may describe as ‘different’. The trade mark therefore fails under the provisions of section 41 of the new Act.

The applicant’s attorney did not succeed in persuading the examiner to withdraw the objection, and, in May 1996, requested a hearing which was conducted before me in Perth on 25 July, 1996.  The applicant was represented by Mr Kelvin Lord.  He was assisted by Ms Amanda Jones.  

As acknowledged by Mr Lord, the operation of sub-section 241(3) of the Trade Marks Act 1995 - the new Act - provides that pending applications lodged under the Trade Marks Act 1955 and not yet accepted, are to proceed under the terms of the new Act. I shall continue to refer to the Trade Marks Act 1955 and the Trade Marks Act 1995 as, respectively, the ‘repealed Act’ and the ‘new Act’.

Mr Lord’s submissions fall under two broad heads - first, he makes some general claims in relation to the new Act and the operation of a ‘presumption of registrability’.  Second, he argues that the  different  stout should be held inherently adapted to distinguish. Under this head he contends that an intangible reference amounts to a vagueness which does not contravene the provisions of section 41, and he submits that the term the  different  stout   is not apt  for any normal descriptive use.

Section 33 and the presumption of registrability

To commence, Mr Lord drew my attention to Part 22.1 of the Trade Marks Office Draft Manual of Practice and Procedure[1] and submitted that in the context of the new Act, there is a ‘presumption of registrability’. This means, he said, that the Registrar must accept an application for registration unless he is satisfied that there are valid grounds for objection.  Although he did not develop this line to any great degree, much of what Mr Lord had to say hangs on this ‘presumption’ and I think it will be useful if I first give some time to the words in the Draft Manual and the relevant sections of the two trade mark Acts.   Part 22.1 of the Draft Manual concerns section 33 of the new Act which reads as follows:-

[1]  hereafter to be referred to as the Draft Manual

33. (1)     The Registrar must, after the examination, accept the application unless he or she is satisfied that:

(a) the application has not been made in accordance with this Act; or

(b)there are grounds for rejection

(2)The Registrar may  accept the application subject to conditions or limitations

(3)If the Registrar is satisfied that:

(a)the application has not been made in accordance with this Act; or

(b)there are grounds for rejecting it;

the Registrar must reject the application.

(4)     The Registrar must not reject an application without giving the applicant an opportunity of being heard.

Section 22.1 of the Draft Manual, referred to by Mr Lord, does little more than re-state sub-section 33(1). It says:

An application for registration of a trade mark must be accepted under subsection 33(1) of the Act unless the Registrar is satisfied either that the application has not been made in accordance with the Act and regulations, or there are grounds for rejecting it.

The equivalent provisions of the Trade Marks Act 1955, the repealed Act, are contained in sub-section 44(1) and are rather differently worded.

44.  (1)           If the Registrar is satisfied that there is no lawful ground of objection to an application, or that the grounds of objection to an application have been removed, the Registrar shall accept the application without conditions or limitations or subject to such conditions or limitations as he thinks fit;  if he is not so satisfied, he may refuse to accept the application.

Under sub-section 44(1) the Registrar needed to be satisfied that there was no lawful ground of objection. Furthermore, the sub-section authorised the Registrar to exercise discretion and refuse any applications when s/he held that resolution of an objection was in dubio. It has been held, consistently and over many years, that in actions under the repealed Act, if the Registrar’s doubt was unresolved, the trade mark application must be refused. In maintaining this approach, some reliance has been put on the ‘Pussikin’ case[2].  Lloyd-Jacob J rejected this appeal and states, at  p38:

[2]  Quennell’s Application, (1955) 72 RPC 36

I ... reject the appeal. In so doing, however, I want to make it plain, that the governing considerations as I have sought to express them arise from the fact that the Applicants have not satisfied me  of the fact of capacity to distinguish ...

In one of the many decisions where the Registrar relied on Lloyd-Jacob J’s judgement, Assistant Registrar Ashton in a 1974 decision refusing the trade mark pvk[3],  says

[3] Eli Lilly and Company’s application (1974) 44 AOJP 3545 at 3546

The Pussikin case ... indicates that even for registration in part B of the Register, no assumptions should be made in the applicant’s favour that its mark is capable of becoming distinctive .

In line with the provisions of sub-section 44(1) a principle of ‘longstanding authority’[4] developed confirming that the onus to resolve doubt fell directly on the applicant.  Justice Isaacs, as early as 1925[5] says,

[4]  Shanahan D.,  Australian Law of Trade Marks and Passing Off, Law Book Company, Sydney 1990 at p79

[5]   A. & F. Pears Limited v The Pearson Soap Company Limited (1925) 37 CLR 340 at 347

... on the whole the applicants for registration have not discharged the onus upon them of showing that the mark in question is free from all danger of leading to confusion or deception, and on that ground the Comptroller ought, in the exercise of his discretion, to have refused to proceed with the registration according to the doctrine laid down in Eno v Dunn[6].

[6]  Dunn's Trade Mark (1890) 7 RPC 311

The new Act now introduces a change in emphasis.  As set down in the Draft Manual, under the terms of this Act, unless the Registrar is satisfied that an objection does exist, subsection 33(1) directs that a trade mark application must be accepted. If the Registrar merely holds that the ground for an objection is in doubt, s/he cannot be satisfied that there is an objection and per 33(1) the application must then be accepted. Consequently, where the Registrar is only prepared to hold the validity of a ground in doubt, that doubt will now be resolved in the applicant’s favour.

The construction of subsection 33(1) gives expression to a fundamental change in approach.  This derives from recommendations of a Working Party which, at the invitation of the Minister for Science, Customs and Small Business, participated in a review of the trade marks legislation. The Working Party Report[7] was presented to the Minister in July 1992. The Second Reading Speech, introduced into the Parliament on 30 March 1995, notes the purpose of the Bill as being

[7]  Recommended Changes to the Australian Trade Marks Legislation : A report to the Hon. Ross Free MP Minister for Science and Technology, July 1992

.. to implement the Government’s response to the July 1992 report, Recommended Changes to the Australian Trade Marks Legislation, as modified by the consultation process.[8]

[8]   Hansard, Senate, Thursday 30 March 1995, p2586  at 2589

Further:

The Working Party made 57 recommendations for change to Australia’s trade marks system. Except for three recommendations, relating to the so-called ‘association’ of trade marks and the structure of the Trade Marks Register, the Working Party’s recommendations were unanimous.  The Government accepted these unanimous recommendations.

In view of the fact that the words presumption of registrability used by Mr Lord do not occur in the new Act but are mentioned in the Working Party report and the Second Reading Speech, and in order to confirm the meaning of section 33, it is helpful to refer to The Working Party report. In doing so I note the following provisions of section 15AB of the Acts Interpretation Act 1901:

15AB. (1) Subject to subsection (3), in the interpretation of a provision of an Act, if any material not forming part of the Act is capable of assisting in the ascertainment of the meaning of the provision, consideration may be given to that material:

(a)          to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act; or

...

(2)      Without limiting the generality of subsection (1), the material that may be considered in accordance with that subsection in the interpretation of a provision of an Act includes:

...

(c)            any relevant report of a committee of the Parliament or of either House of the Parliament that was made to the Parliament or that House of the Parliament before the time when the provision was enacted;

...

(e) any explanatory memorandum relating to the Bill containing the provision, or any other relevant document, that was laid before, or furnished to the members of, either House of the Parliament by a Minister before the time when the provision was enacted;

(f) the speech made to a House of the Parliament by a Minister on the occasion of the moving by that Minister of a motion that the Bill containing the provision be read a second time in that House;

Referring to the Trade Marks Act 1955, and under the headings Registrability and Presumption of Registrability, p41, the Working  Party report says:

The requirements for registrability are currently expressed as positive attributes that  a mark must possess in order to qualify for registration.  The courts have confirmed that under this system the onus is on the applicant to show that its mark should be registered.  More recently, opinion has indicated that the present regime is too strict and prevents registration of some marks that are demonstrably capable of distinguishing the owners’ goods or services

The EC Directive, the Harmonisation Draft Treaty and the trips Agreement adopt the opposite approach by setting out the grounds for refusal, thus creating a presumption that a mark ought to be registered unless there is some specific objection to it. [9]

[9] Recommended Changes to the Australian Trade Marks Legislation : A report to the Hon. Ross Free MP Minister for Science and Technology, July 1992,  p41

On these considerations, the Working Party recommended that:

The legislation should be expressed in terms which make it clear that there is to be a presumption of registrability when examining an application for registration[10]

[10]  ibid  p42

The Second Reading Speech comments specifically on this recommendation.   

The bill is expressed in terms that make it clear that there is to be a presumption of registrability when an application for registration is being examined by the Registrar of Trade Marks.  This means that if there is any doubt about whether a trade mark should be registered, that doubt will be resolved in favour of the applicant, rather than against the applicant as is now the case. [11]

[11] Hansard, Senate, Thursday 30 March 1995, p2586  at 2590

The new Act sub-section 33(1) gives effect to this changed direction. It denies the Registrar a discretion to reject when s/he holds that the validity of an objection is in doubt. It imports a presumption of registrability and it brings about a shift in the onus.

However, the grounds for rejecting a mark are exhaustively listed under Division 2 of Part 4, and if the Registrar holds, on balance, that one of these grounds constitutes a reason for rejection, the provisions of sub-section 33(3) come into operation. This subsection sets down the provisions for rejecting an application. It prescribes that if the Registrar is satisfied either that the application is not in accordance with the Act, or that there are grounds for rejection, the application must be rejected. This is mandatory language and of some greater force than the equivalent part of sub-section 44(1) of the repealed Act. Under 44(1) the Registrar had discretion to refuse applications. This discretion to refuse has not been carried over into the new Act. On the contrary, sub-section 33(3) now lays down that if the provisions of paragraphs 33(3)(a) or (b) apply, the Registrar must reject the trade mark application.

There are then two clear differences between the operation of section 33 of the Trade Marks Act 1995 and section 44 of the Trade Marks Act 1955. First - under the new Act - if there is doubt as to whether the application is in accordance with the Act, or as to whether a ground for rejection is valid, the applicant will be allowed the benefit of that doubt.   Second - under the new Act - if the Registrar is satisfied that the application is not made in accordance with the Act or that there are grounds for rejection, there is no longer a discretion to refuse: the application now must be rejected.  

Section 41

Mr Lord submitted that unless I am satisfied that there is a valid ground for rejection against the trade mark the  different stout, I must accept the application for registration.  We agree on that point. I now turn, however, to the submission made by Mr Lord in relation to the examiner’s objection that this mark is not capable of  distinguishing the applicant’s stouts.

Inherently  adapted to distinguish

Mr Lord’s position is that the term the  different  stout  is inherently adapted to distinguish.  He pointed me to a large number of marks which had been refused under the repealed Act. In particular he referred to the ‘Oxford’ case,[12] and to Lockhart J’s approval of Kitto J’s definition of ‘adapted to distinguish’- p 512:

[12]  Oxford University Press v The Registrar of Trade Marks,  17 IPR 509

The central question is, in my view, whether the word ‘Oxford’ is ‘adapted to distinguish’ the goods of the appellant ... a question which is to ‘be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives - in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess - will think of a word and want to use it in connection with similar goods in any manner which would infringe a registered trade mark granted in respect of it’ [13]

[13]   Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511 per Kitto J at 514; Burger King Corp v Registrar of Trade Marks (1973) 128 CLR 417 per Gibbs J at 425

Mr Lord takes the position that whereas words such as the famously refused trade marks barrier cream, oxford, hairfusion, electrix, perfection, orlwoola and  whopper clearly fall foul of this test, the words the  different  stout  do not.  He says that the  different  stout  does not describe a kind or type of stout or beer.  It does not describe the quality or quantity.  It may, he says,  ‘in some vague sense’ indicate that the stout is somehow ‘different or unusual’ but it does not say that the goods are of any particular colour, have any particular taste, smell, strength, alcoholic content or level of carbonation.  The words do not say that it is ‘light’ stout, or ‘extra strength stout’ or ‘malty stout’. Compared with barrier cream, et al, the  different  stout, he says,  is a term which is inherently adapted to distinguish the applicant’s goods from those of other traders.

Mr Lord’s reference for defining the term ‘adapted to distinguish’ is particularly germane. Justice Kitto’s words perfectly explain the meaning of the term in the context of trade mark law and, as per the provisions of section 41 of the new Act, this term continues to be of critical importance in testing the registrability of a trade mark. Section 41, as it is applicable reads:

41. (2) An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant's goods or services in respect of which the trade mark is sought to be registered from the goods or services of other persons.

41. (3) In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.

41. (4) Then, if the Registrar is still unable to decide the question, the following provisions apply.

41. (5) If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so  distinguishing the designated goods or services:

(a)  the Registrar is to consider whether, because of the combined effect of the following:

(i)the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;

(ii) the use, or intended use, of the trade mark by the applicant;

(iii)any other circumstances;

the trade mark does or will distinguish the designated goods or services as being those of the applicant; and

(b)  if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken to be capable of distinguishing the applicant's goods or services from the goods or services of other persons; and

(c)  if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken not to be capable of distinguishing the applicant's goods or services from the goods or services of other persons.

41. (6) If the Registrar finds that the trade mark is not inherently adapted to distinguish the designated goods or services from the goods or services of other persons, the following provisions apply:

(a)  if the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant—the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other persons;

(b)  in any other case—the trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons.

The provisions of sub-section 41(2) direct that if a trade mark is not ‘capable of distinguishing’ an applicant’s goods, it must be rejected. Sub-section 41(3) directs that ‘capable of distinguishing’ is to be tested first by assessing the degree to which a mark is ‘inherently adapted to distinguish’. That, as Justice Kitto so clearly spells out, obliges the Registrar to consider whether other brewers and traders of stout, acting only on proper motives and exercising their common right to make honest use of ordinary words, are likely to think of the words the  different  stout  and need or wish to use them in connection with any stout they may wish to promote as ‘different’.

Aptness for normal description

Considering then the term the  different  stout.  It is composed of ordinary descriptive words and they proclaim the fact that the stout is different.  Mr Lord’s submissions that these words do not function in this way simply fly in the face of the obvious. the  different  stout  plainly says that the stout ‘is different’.  The difference may lie in quantity or quality - colour, taste, smell, strength, alcoholic content or level of carbonation.  I agree that the reference ‘different’ is not specific. But, the first question of whether a mark is ‘capable of distinguishing’ - the question of whether it is ‘inherently adapted to distinguish’ - is simply the question of whether honest traders, acting on proper motives, are likely to want to use the term for the sake of its common meaning.  For stout which varies in any one of the characteristics mentioned by Mr Lord, the words the  different  stout are the apt  and accurate words to convey that information.  The fact that they define a general rather than a specific characteristic increases the likelihood that other traders will need to use the term.  Whether a stout is promoted because of a different colour, taste, smell, strength, alcoholic content or carbonation level, the  different  stout conveys the primary fact that it is not the same as other stouts.

Intangible reference

Mr Lord puts considerable reliance on the fact that the  different  stout  does not nominate the specific character which make the stout ‘different’.  He claims that a reference of this kind is ‘intangible’ and refers me to the findings in the ‘Perfectly   You’  case[14].  He argues that it is only when a description is ‘tangible’ that an objection to registration can be raised under the terms of section 41. This distinction, I find, has no basis in the law as it now stands, and I reject it. Sub-sections 41(2) and (3) preclude marks which are not capable of distinguishing for want of inherent adaptation to distinguish. As Justice Kitto (supra) so clearly explains, words which are likely to be used by competitive traders acting innocently to describe their own goods, fail this test. The degree of tangibility in a word may be a factor here. If a word conveys a totally intangible quality it may be that it can give no indication of practical matters such as the kind, quality, quantity, intended purpose, value or geographical origin of the goods[15].  Thus it is not likely to be required for its descriptive function.  Included here are words which do nothing more than allude to one of these values - such as ‘happy’[16]. On the other hand, however, many intangible words are used as trade descriptions and are enthusiastically employed in promotional texts. This includes works like ‘beautiful’, ‘cheap’, ‘flavour’, ‘suitable’ and  ‘desirable’.  These, on Mr Lord’s reasoning, could all be argued as intangible references. They do not proclaim that the stout is ‘a beautiful deep amber brown’ or ‘only $2’ or ‘a fresh malt flavour’, ‘good with fish and chips’ or ‘superb quality’.  Similarly, the word less, if applied to stout is not enough to specify whether the stout contains ‘less alcohol’ or ‘less calories’.  However, as observed by the High Court[17]

[14]   Wella Aktiengesellschaft v Registrar of Trade Marks 33 IPR 374

[15] see Note 1, sub-section 41(6), Trade Marks Act1995

[16]  Mark Foy’s Ltd. v Davies Coop & Co Ltd (1956) 95 CLR 190

[17]  Registrar of Trade Marks  v Muller (1980) 144 CLR 37 at 41 - Stephen, Mason, Murphy, Aikin and Wilson JJ

.. less is a well-known word  which has an immediate and easily recognizable meaning.  When linked to pharmaceutical products where the quantity and concentration of active ingredients is an important, if not critical, factor, the word makes reference to the character or quality of the product because it will be understood by the public as a representation about its ingredients or its strength.  So clearly does this connotation emerge that we have no hesitation in regarding the reference to character or quality as one which is ‘direct’.

The High Court rejected the word less.  Its findings that a reference to goods disqualifies a trade mark even though that reference is not specific is not disturbed, I think, by the ‘Perfectly You’ case[18]which Mr Lord referred me to.  I acknowledge Justice Lehane’s comments. However the Federal Court’s attention was not drawn to the full force of the less decision.  Further, I am aware of the time pressure under which this case was heard, and with respect, I note His Honour’s comments at p 375

[18]  Wella Aktiengesellschaft v Registrar of Trade Marks 33 IPR 374

The appeal was heard during vacation because the applicant asserts, and the respondent accepts, that if the applicant is entitled to registration of the mark but does not achieve it before 1 January 1996, when the Trade Marks Act 1995 (Cth) will take effect, the applicant will be substantially prejudiced. For the same reason, having come to a clear conclusion, I am giving my decision now rather than take the time necessary to prepare fuller and more considered reasons.

Decision

Testing the present trade mark the different stout under the provisions of sub-section 41(2) and (3) of the new Act I am satisfied, for reasons I have discussed, that this mark consists of a term which is entirely apt for normal descriptive use. It is a plain statement of fact that the goods are different. The term the  different  stout  is not only perfectly appropriate for this purpose but, moreover, seems to me to be the most obvious term to use. The trade mark is therefore not inherently adapted to distinguish the applicant’s goods from goods of other traders, and, I find that prima facie it is not capable of distinguishing the applicant’s goods from goods of other persons. Having come to that decision, the further tests under sub-section 41(5) do not apply, and as there has been no use and no argument for factual distinctiveness the tests under sub-section 41(6) do not come into operation.

Having decided that this trade mark application is not capable of distinguishing the applicant’s goods, the terms of sub-section 41(2) provide that the trade mark must be rejected. The applicant has had its hearing, and in accordance with the authority of section 33, I now reject this trade mark application.

Helen R. Hardie
Deputy Registrar

18 October, 1996