Inghams Enterprises Pty Limited v Tegel Foods Limited

[2010] ATMO 94

TRADE MARKS ACT 1995

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

Re:Opposition by Inghams Enterprises Pty Limited to an application under section 92 of the Act by Tegel Foods Limited to remove trade mark number 245341(29) - TEGEL - in the name of Inghams Enterprises Pty Limited

Delegate:	Jock McDonagh
Representation:	Opponent: Tom Cordiner of counsel, instructed by Griffith Hack Patent and Trade Mark Attorneys Applicant: Matthew Hayes of AJ Park Patent and Trade Mark Attorneys
Decision:	2010 ATMO 94 Section 92(4)(b) opposition – request to file further evidence granted – exercise of Registrar’s discretion where no evidence of use in prescribed period – trade mark abandoned - registration to be removed from Register – costs awarded against opponent

Background

1. Inghams Enterprises Pty Limited (‘the opponent’) is the registered owner of a trade mark, current details of which appear below:

   Trade mark number:           245341

   Registered from:                  17 January 1971

   Goods:  Class 29: poultry

   Trade mark:  TEGEL          

2. On 16 December 2008, Tegel Foods Limited (‘the applicant’) filed an application under section 92(4)(b) of the Trade Marks Act 1995 (‘the Act’) for removal of the trade mark from the Register.

3. On 9 April 2009 the opponent filed Notice of Opposition to the removal, claiming that its application was made in good faith, use of the trade mark in good faith, and seeking the Registrar’s discretion to retain the trade mark on the Register.

4. The matter came before me, as a delegate of the Registrar of Trade Marks, for hearing in Melbourne on 10 June 2010.  The opponent was represented by Tom Cordiner of counsel, instructed by Griffith Hack Patent and Trade Mark Attorneys. The applicant was represented by Matthew Hayes of AJ Park Patent and Trade Mark Attorneys.

   Evidence

5. The following evidence was filed and served pursuant to legislation:

Declarant	Status	Date, Known as	Exhibits
Evidence in Support
Henri Leuzinger	Chef	3.07.2009, Leuzinger
Michael Phillips	Chairman, Combined Foodservices of Australia	31.07.2009
John Richard Hexton	Director of Group Services of opponent	1.09.2009, Hexton	A to E
Dixie Lynn Elliot	Freelance qualified home economist	3.10.2009

Preliminary matter

1. The opponent sought permission to serve further evidence pursuant to Regulation 15.15 of the Trade Marks Regulations 1995 (‘the Regulations’). Both parties provided detailed and useful written submissions on the issue, which I have taken into account but will not repeat in detail here.

2. The further evidence was a second declaration by John Richard Hexton and provided specific sales figures of goods sold under the trade mark, in addition to evidence he had provided in support of the opposition.

3. The opponent submitted that the further evidence clarifies general evidence already provided and did not break any new ground and would assist me in understanding the exact scope of the sales: Pioneer Hi-Bred Corn v Hy-line Chicks Pty Ltd [1979] RPC 41 at 435 to 436 (New Zealand Court of Appeal).

4. The applicant opposed the grant of permission, citing the  threefold test in Ladd v Marshall (1954) 1 WLR 1489, particularly on the bases that it had not been shown why the evidence could not have been served earlier and that it had not been shown that the evidence was likely to have an important effect on the outcome.

5. Having taken the written and oral submissions into account, I have decided to allow the evidence to be served and filed. The evidence had been served on the applicant on 7 June 2010. The reason I am granting permission is that, in the absence of evidence of use of the trade mark, the opponent relies upon the Registrar’s discretion and the issue of “residual reputation”. The further evidence is relevant to this issue and were I to ignore it I do not believe I could appreciate the opponent’s position prior to cessation of its use of the trade mark.

   Applicable Law

6. Under section 100 of the Act, the onus of establishing use or the intention to use the trade mark lies with the removal opponent. In this case, there is no such use or intention supported by the evidence before me. The non-use of the trade mark has been established. Therefore, I am required to determine the matter pursuant to section 101 of the Act, which relevantly provides:

   Determination of opposed application—general

   101.(1) Subject to subsection (3) and to section 102, if:

   (a) the proceedings relating to an opposed application have not been discontinued or dismissed; and
   (b) the Registrar is satisfied that the grounds on which the application was made have been established;

   the Registrar may decide to remove the trade mark from the Register in respect of any or all of the goods and/or services to which the application relates.

   (2) Subject to subsection (3) and to section 102, if, at the end of the proceedings relating to an opposed application, the court is satisfied that the grounds on which the application was made have been established, the court may order the Registrar to remove the trade mark from the Register in respect of any or all of the goods and/or services to which the application relates.

   (3) If satisfied that it is reasonable to do so, the Registrar or the court may decide that the trade mark should not be removed from the Register even if the grounds on which the application was made have been established.

   (4)  Without limiting the matters the Registrar may take into account in deciding under subsection (3) not to remove a trade mark from the Register, the Registrar may take into account whether the trade mark has been used by its registered owner in respect of:

   (a)  similar goods or closely related services; or

   (b)  similar services or closely related goods;

   to those to which the application relates.

7. The opponent asks me to exercise the discretion under section 101(3).

   Facts

8. The history of the use of the trade mark was detailed in Hexton and is not in dispute.

9. A company named AA Tegel Pty Ltd commenced using the TEGEL trade mark for poultry in Australia in the 1940s and used it continuously until 1994 when it assigned the trade mark to the opponent, its then sole shareholder.

10. The opponent had acquired 50% of the shares of AA Tegel in 1963. In 1987, the opponent increased its shareholding to 70%. In 1994, the opponent acquired all remaining shares in AA Tegel, thus obtaining 100% shareholding.

11. In 1995, the opponent ceased advertising the TEGEL trade mark and, in 1997, ceased using the TEGEL trade mark in relation to poultry. Thereafter, the opponent sold all of its poultry products under the trade mark INGHAM’S.

    Opinions

12. In Leuzinger, Henri Leuzinger states that he has worked in the food and beverage industry between 1956 and 2007. He worked as a chef for Qantas from 1979 to 1980 and as food and beverage manager with Ansett Airlines from 1980 to 1997. Additionally, from 1980 to 1995, he worked as a director of Uni-Chef, which supplied prepared foods to airlines, hotels and shipping lines. In 1995, Uni-Chef was sold to the opponent, with whom the declarant worked until 2007.

13. Mr Leuzinger states that, as a result of his knowledge of the industry, if he observed a poultry product being sold under the TEGEL mark today he would assume that the opponent had re-launched the TEGEL brand.

14. Michael Phillips declares that he has been involved in the food industry since 1975. He is currently Chairman of Combined Foodservices of Australia (“CFA”), Australia’s largest foodservice buying group.

15. Mr Phillips has had much experience in the poultry supply and distribution business. He states that if he were to see poultry products sold under the TEGEL brand today, he would assume that they originated from the opponent.

16. Dixie Elliot declares that she is a freelance qualified home economist and has worked in the food industry since the 1980s. While she has no specialist knowledge in the poultry industry, she says that if she saw the TEGEL mark used on poultry goods today, she would assume that the opponent would be the source. She also opined that a significant number of consumers would share this belief.

    Discussion

17. Counsel for the opponent submitted that the Act conferred a broad discretion: CA Henschke & Co v Rosemount Estates Pty Ltd [2000] 52 IPR 42 at 73.

18. He emphasized the discretion is no longer constrained by any requirement to establish “exceptional circumstances”: E & J Gallo Winery v Lion Nathan Australia Pty Limited [2008] FCA 934 at paragraph 198.

19. Counsel for the opponent further submitted that the following circumstances set out by Falconer J in Hermes Trade Mark [1982] RPC 425 have been held by Flick J in E & J Gallo Winery v Lion Nathan Australia Pty Limited (supra) to be of assistance in considering the exercise of the discretion:

    ·     There had been no abandonment of the trade mark;

    ·     The registered proprietor of the mark still had a residual reputation in the mark;

    ·     There had been sales by the registered proprietor of goods for which removal was sought since the relevant period ended;

    ·     The applicant for removal had entered the marked without having taken steps to ascertain from the Trade Marks Register whether anyone had the right to exclude their use of the mark;

    ·     The registered proprietor was not aware of the applicant’s sales under the mark.

20. The opponent seeks the exercise of the Registrar’s discretion in its favour on the basis that there remains in Australia a significant reputation not only in the trade mark itself but also in its association with poultry. The opponent submitted that there are no significant countervailing policy reasons for not exercising the discretion while that reputation remains and as long as the opponent has not abandoned the trade mark.

21. The applicant concurred with the authorities cited by the opponent; however the applicant pointed out that in the cases cited residual reputation was not the sole factor relied upon and there was also evidence of use along with a clear intention to resume use or continue using the trade mark.

22. The applicant submitted that the question of whether there is any residual reputation is dependant on whether there has been any extinction or abandonment of goodwill. It was submitted that in considering this there are three possibilities:

    ·     If a business ceases or suspends trading temporarily, there may remain a residual goodwill that the business  might wish to sell or use in a reopened business;

    ·     If the business is definitely abandoned, then the claimant no longer owns the goodwill;

    ·     Where no positive decision is made to abandon goodwill, but trade under the mark has nonetheless ceased with no concrete plan for restarting operations, the question of whether any residual goodwill survives, and for how long, is a question of fact in each case.

23. Having regard to the evidence and submissions from both parties, I do not intend to exercise the discretion to leave the trade mark on the register. My reasons follow.

24. While the opponent asserts that it has not abandoned the trade mark, the facts of the case suggest that the opponent effectively abandoned the use of the trade mark in 1997. Mr Hexton clearly states that the opponent ceased advertising the mark in 1995 and ceased applying the trade mark in 1997.

25. There is no evidence that there was ever any intention to resume use of the trade mark at a future date. Indeed the evidence suggests a long term campaign by the opponent to control a former rival and eventually to own its business with a view to eliminating the TEGEL trade mark.

26. Indeed, Mr Hexton states that the opponent gave the applicant a great deal of assistance and advice in the applicant’s setting up poultry operations in New Zealand. The assistance included allowing the applicant to use the name TEGEL as both a company name and trade mark in New Zealand.

27. The opponent’s actions do not appear consistent with an intention to use the trade mark. Additionally, there is no evidence whatsoever of any use of the trade mark in Australia since 1997.

28. The evidence does demonstrate that at the time the opponent ceased use of the TEGEL trade mark the substantial volume of sales and advertising would support the contention of that it had a considerable reputation in the trade mark. However, it is reasonable to presume that this reputation would decline as time went by.

29. The evidence tendered to support the claim to residual reputation is in my view insufficient to establish that a substantial number of persons in Australia would associate the TEGEL trade mark with the opponent.

30. All the witnesses were food professionals of a generation that would recall AA Tegel as a separate entity prior to its being acquired by the opponent. Mr Leuzinger had been in business with the opponent, which I believe would colour his memory and possibly cast doubt on his objectivity.

31. I consider that the trade mark has been abandoned and that the public interest is in removal of an abandoned trade mark from the Register. There is no public interest in protecting unused trade marks based on mere speculation that their future use by third parties might confuse a small number of people.

    Decision

32. I direct that registration number 245341 be removed from the Register one month from the date of this decision. If the Registrar has been served with a notice of appeal before then, I direct that removal shall not occur until the appeal has been discontinued or, in the event of a decision from the Court, that the registration be dealt with as the Court sees fit.

    Costs

33. The removal applicant is the successful party and is entitled to its costs. Accordingly, I award costs against the opponent, as per Schedule 8 of the Regulations.

    Jock McDonagh
    Hearings Officer
    Trade Marks Hearings
    24 September 2010