Heritage Seeds Pty Ltd

[2007] ATMO 4

TRADE MARKS ACT 1995

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

Re:Trade mark application number 1050042(31) – PLUS AR1- in the name of Heritage Seeds Pty Ltd.

Delegate:	Alison Windsor
Decision:	Section 41 – trade mark not capable of distinguishing - application rejected

Background

1. Heritage Seeds Pty Ltd (“the applicant”) filed application to register a trade mark, details of which are shown below:

Trade mark number:                   1050042

Trade Mark:  PLUS AR1

Filing date:  11 April 2005

Goods specification:  Class 31 - Rye grass seeds and grain for agricultural

purposes

1. The application was examined, as is required by section 31 of the Trade Marks Act 1995 (“the Act”) and the first report issued on 27 June 2005. The report raised grounds for rejecting the application under the provisions of section 41 of the Act, phrased as follows:

   Your trade mark consists of “PLUS AR1”.  “AR1” is the name of a registered variety of ryegrass endophyte.  The phrase PLUS AR1 indicates that the goods are ryegrass containing the AR1 endophyte.  Other traders should be able to use PLUS AR1 to indicate the presence of this endophyte in their ryegrass.

The report went on to advise the applicant of the actions they could take to overcome the objection.  I quote again from the examination report:

You can address this matter if you:

Provide me with evidence of use and/or intended use and/or other circumstances under subsection 41(5) of the Trade Marks Act 1995.

Due to the nature of the trade mark you will need to provide substantial, persuasive evidence of use before your trade mark can be accepted.

PLEASE NOTE: Before deciding whether to provide evidence you should carefully consider the following:

Gathering and compilation of this information can be time-consuming and costly.

The evidence you provide may not be sufficient to overcome the problem.

1. The applicant responded by providing evidence of use, in the form of a Statutory Declaration with exhibits, made by an officer of the applicant company.  The examiner considered the evidence, but advised the applicant the grounds for rejection were to be maintained.  The applicant then requested a decision on the written record, and the file was eventually passed to me, as delegate of the Registrar of Trade Marks, for determination.

The law

1. The sole ground for rejection raised against this application is that under the provisions of subsection 41(5) of the Act. The legislation relevantly provides:

Section 41: Trade mark not distinguishing applicant's goods or services

(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 (designated goods or services) from the goods or services of other persons.

Note: For goods of a person and services of a person see section 6.

(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.

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

(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.

1. Justice Branson sets out a synopsis of the structure of this section of the Act in Blount Inc v Registrar of Trade Marks, 40 IPR 498 at 504 with the words:

   Subsections (3) - (6) of s 41 of the Act are designed to control the process by which the registrar is to reach a conclusion as to whether the trade mark for which registration is sought is capable of distinguishing the applicant's goods or services ….. it is theoretically open to the registrar to conclude:

   (a) that the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons and capable, on that basis alone, of so distinguishing the designated goods or services; or

   (b) that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons; or

   (c) 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 there is uncertainty, on that basis alone, that the trade mark is actually capable of so distinguishing the designated goods or services.

2. In the present circumstances, the examiner concluded that option (c) of Justice Branson’s summary applied.  The examiner found the trade mark had some inherent adaptation to distinguish the designated goods, but there was insufficient to say it was, without more, capable of doing so.  Hence the examiner’s advice to the applicant that it could consider providing evidence of use to support its application.

The evidence

1. The evidence provided to the examiner in response to the first official report consists of a Statutory Declaration made by Phillip Harry Poulton, Finance Director of Heritage Seeds Pty Ltd.  Mr Poulton states that the trade mark was first used in 2002 on bags in which the goods were sold, on brochures, labels, packaging, advertising material and sales literature.  Paragraph 5 of the declaration gives yearly sales figures in Australia for the years 2003 to 2006, totaling a little over $1.1 million.  Advertising figures for the same period are approximately one quarter of those sales figures.  Total annual sales figures worldwide for the last financial year, Mr Poulton says, are $25.6 million.

2. Exhibit PHP-1 to the declaration consists of a selection of sales literature and brochures.  Many of the brochures are technical publications designed to provide advice to primary producers on use of the products, and its benefits to their businesses.  The technical publications cover more of the applicant’s range of products than is involved in this application, and offer many examples of comparative information between various varieties of the applicant’s seeds.  The trade mark is not referred to consistently throughout these documents, but appears in varying forms, including Plus^TMAR1, PlusAR1, Plus AR1 and [1].

   [1] I note the final version shown here also has a ^TM after the word “plus”, only visible when the version is sufficiently enlarged. 

Discussion

1. The ground for rejection raised in the first report refers to the letter/number combination AR1 as “the name of a registered variety of ryegrass endophyte”. The registration referred to is a registration under the Plant Breeders Rights Act 1994 (“PBR Act”).  Details of this registration are shown in the following table:

Fungal Endophyte[2] (Neotyphodium lolii)

[2] Section 3 of the PBR Act defines “plant” as including all fungi.

Variety:	'AR1'
Application no:	1997/013	Description published in Plant Varieties Journal:	Volume 10, Issue 2
Current status:	GRANTED	Title Holder:	Grasslanz Technology Limited
Certificate no:	2591	Agent:	Griffith Hack
Received:	11-Jan-1997
Accepted:	06-Feb-1997
Granted:	26-Oct-2004

1. There are many definitions available of the word “endophyte”.  Put simply, an endophyte is a living organism - a fungus - which in this case has developed a mutually beneficial relationship with its grass plant host.  Part of the relationship is that the fungus offers the grass plant some protection from predators, be they insects or grazing animals.  To protect against grazing animals, the endophyte produces alkaloids[3] which, if the animal eats too much of the plant, will cause it to sicken, fail to thrive and quite possibly die.

   [3] Alkaloid:  one of a class of basic nitrogenous organic compounds occurring in plants, such as nicotine, atropine, morphine, or quinine. (Macquarie Dictionary, on-line version).

2. The scientific development of this particular endophyte is referred to in the full description of the variety which accompanies the PBR registration.  Seeds of perennial ryegrass originating from Italy and Spain were screened in large numbers. Some seeds from one ryegrass collected in Italy was identified as having a strain of Neotyphoidium lolii, identified as AR1, which produced various alkaloids active against insect pests but had little or none of the alkaloids which are toxic to livestock.  By inoculating ryegrasses with this particular endophyte, the toxicity to livestock inherent in many ryegrass pastures can be minimised.

3. The opportunity to choose a ryegrass pasture which does not have the potential to cause livestock illness or to restrict livestock growth must be of great benefit for the pastoral industry.  That the applicant considers this to be so is apparent from most of the brochures and information booklets supplied as evidence of use.  Supporting information can also be found from sources other than the applicant. 

4. However, it is also apparent from these documents that the applicant itself often uses the sign not as a trade mark but as a description.  For example, the following information can be found in one of the brochures supplied: 

   Plus AR1 pastures will not cause ryegrass staggers, even in young stock, or contribute to heat stress.  Plus AR1 paddocks are safe for grazing over summer and autumn  …  

5. Various others of the catalogue and product listings provided refer to different varieties of ryegrass such as “Bronsyn” and “Meridian”[4].  These two varieties of ryegrass are also advertised as follows:  “Bronsyn Plus AR1” and “Meridian Plus AR1”.  It appears from this reference that the particular varieties of ryegrass may be purchased with or without the registered variety of endophyte.

   [4] Information on both these varieties can be found on the applicant’s website, >

   The basic matter I need to determine is whether the combination of the word “plus” and the PBR registered name of a living organism, has the capacity to distinguish the claimed goods from those of others trading in the same field.  The goods in question are grass seeds and grains incorporating the organism.

6. The examiner raised grounds for rejection under the provisions of subsection 41(5), because of the belief that the trade mark, as a whole, had insufficient inherent adaptation to distinguish for it to be prima facie acceptable. I agree with the examiner’s view of the trade mark. Inherent adaptation is a concept that refers to a quality of the trade mark itself and cannot be acquired through use in the market place. Gibbs J, in the Whopper case[5], said in relation to paragraph 26(2)(a) of the repealed Act when discussing the concept:

   Inherent adaptability is something which depends on the nature of the trade mark itself - see Clark Equipment Co v Registrar of Trade Marks [(1964) 111 CLR 511 at 515 - the Michigan case] - and therefore is not something that can be acquired; the inherent nature of the trade mark itself cannot be changed by use or otherwise.

   [5] Burger King Corporation v Registrar of Trade Marks (1973) 128 CLR 417 at 428

7. I think it is worth quoting at length the words of Kitto J in the Michigan[6] case as they set out the criteria upon which a judgement about inherent adaptation should be made:

   That ultimate question must not be misunderstood [that is, "whether the mark is registrable as being 'adapted to distinguish' the applicant's goods"]. It is not whether the mark will be adapted to distinguish the registered owner's goods if it be registered and other persons consequently find themselves precluded from using it. The question is whether the mark, considered quite apart from the effects of registration, is such that by its use the applicant is likely to attain his object of thereby distinguishing his goods from the goods of others. In Registrar of Trade Marks v W. and G. Du Cros Ltd. (1913) AC 624 at 634, 635) Lord Parker of Waddington having remarked upon the difficulty of finding the right criterion by which to determine whether a proposed mark is or is not "adapted to distinguish" the applicant's goods defined the crucial question practically as I have stated it, and added two sentences which have often been quoted but to which it is well to return for an understanding of the problem in a case such as the present. His Lordship said: "The applicant's chance of success in this respect (ie. in distinguishing his goods by means of the mark, apart from the effects of registration) must, I think, largely depend upon whether other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connection with their own goods. It is apparent from the history of trade marks in this country that both the Legislature and the Courts have always shown a natural disinclination to allow any person to obtain by registration under the Trade Marks Acts a monopoly in what others may legitimately desire to use." The interests of strangers and of the public are thus bound up with the whole question, as Hamilton L.J. pointed out in the case of R. J. Lea, Ltd. (30 RPC 216 at 227); but to say this is not to treat the question as depending upon some vague notion of public policy; it is to insist that the question whether a mark is adapted to distinguish 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 the 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.

   [6] Clark Equipment Co. v Registrar of Trade Marks (1964) 111 CLR 511 at 513

8. Kitto J then summarised the appropriate inquiry in the Barrier Cream[7] case as follows:

   The question to be asked in order to test whether a word is adapted to distinguish one trader's goods from the goods of all others is whether the word is one which other traders are likely in the ordinary course of their business and without any improper motive, to desire to use upon or in connection with their goods.

   [7] F. H. Faulding & Son Ltd v Imperial Chemical Industries of Australia and New Zealand Ltd. (1965) 112 CLR 537

9. The letter/numeral combination AR1 is the name of a specific living organism.  The name is registered under Australian law, by a party other than the applicant.  The accepted name of such an organism, whether registered under some form of plant breeder’s or variety rights law, whether generally accepted in the relevant trade or by the buying public, describes the organism.  It thus has no inherent adaptation to distinguish one trader’s goods from those of another, in respect of the organism itself or its host plants.  Whether a trade mark incorporating such a term will have sufficient adaptation to distinguish will depend on the other material incorporated within it. 

10. In this case, the additional material consists of the word PLUS. The combination, in use on the goods claimed, refers to rye grass plus the specific endophyte known as AR1. I am satisfied that the proposed trade mark is a term which other traders are likely to desire to use in connection with their goods. Other people selling ryegrass seed who wish to sell varieties with the addition of this particular endophyte are likely to need to say they are selling “ryegrass variety X plus AR1”. This kind of use does not amount to trade mark use, but is descriptive use. Descriptive use does not serve to distinguish the applicant’s goods from those of other traders. The trade mark is therefore caught by the provisions of subsection 41(5).

11. Once a trade mark falls foul of subsection 41(5), the applicant is at liberty to provide evidence of use or intended use, or make the Registrar aware of any other circumstances relevant to the case which might help the Registrar decide the matter. The applicant provided evidence of use, summarized previously in paragraphs 7 and 8. This evidence, as I have mentioned at various points, does not show consistent use of the sign as a trade mark, so much as use as a descriptive term referring to the presence in the applicant’s grass seeds of the particular endophyte. The evidence does not satisfy me that the sign has, or will have, the capacity to distinguish the applicant’s goods from those of others. In addition, I have not found any other circumstances surrounding the application which would satisfy me otherwise.

Decision

1. I have found the trade mark is not capable of distinguishing the applicant’s goods as required by the provisions of subsection 41(5). I therefore reject trade mark application 1050042.

Alison Windsor

Hearings Officer

Trade Marks Hearings

IP Australia

25 January 2007