ITT Corporation v Caltex Petroleum Corporation

[1996] ATMO 19

TRADE MARKS ACT 1955

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

Re:Opposition by Caltex Petroleum Corporation to an application under s23 in the name of ITT Corporation for the removal of trade mark registration no 497775.

Background
On 25.5.94, ITT Corporation ("the applicant") applied to remove trade mark no. 497775 from the register.  The registration thus attacked is for the word STARCARD, registered in respect of all goods in class 9.  In general terms, this includes a vast array of electrical and electronic and/or scientific apparatus.  I will note at this point that the applicant itself trades in some such goods.  The applicant’s own goods are best described as integrated circuit memory cards.  These are plug-in devices which boost the performance of, typically, lap-top computers.

The grounds relied on by the applicant are those in both paras (a) and (b) of s 23(1), which provide, in simplified terms, that the mark:
(a) was registered without an intention in good faith, on the part of the applicant for registration, to use the mark in relation to the goods and that there had been, in fact, no use of the mark in relation to the goods, or, in the alternative,
(b) that there had been no use of the mark in relation to the goods for a period of three years up to one month before the date of the application.

Removal has been opposed by the registered proprietor of the mark, Caltex Petroleum Corporation ("the opponent").

The opposition developed as per the regulations, with both sides serving evidence on which they relied.  At the eventual hearing, Trevor Stevens, a patent attorney of the firm of Davies Collison Cave, appeared for the applicant and David Wilson, a patent attorney of the firm of Shelston Waters, for the opponent.  I am now to decide the matter, as a delegate of the registrar.
Issues and decision
An application under s 23 can only be made by “a person aggrieved”.  Mr Wilson conceded that the applicant is such a person.  That was quite reasonable, as the opponent’s registration has been cited by an examiner as being an obstruction to the section 23 applicant’s own pending application to be registered as the proprietor of STARCARD in respect of the goods in which it trades.

As to subsequent questions, Mr Stevens made it clear that the applicant was seeking removal under s 23(1)b only, and that the removal was for “any or all goods” on the basis of non-use by both the proprietor and its registered user, Caltex Oil (Australia) Pty Ltd)  (“Caltex Australia”), during the relevant three year period ending one month before the date of the application.  On that basis, he commenced his primary submission, aimed at establishing a prima facie case that the registration was unused during the relevant period.

He noted that the Examiner’s Manual under the 1955 act has conceded the difficulties faced by a removal applicant.  Chapter 10.05 of the manual notes that the registrar will not make “unreasonable demands” for evidence.  Mr Stevens also noted the broad ranging scope of the registration, which covers things as diverse as meteorological balloons and electric fences.  For such a general registration, he submitted, a general enquiry was appropriate.  He turned, in that light, to the evidence supporting the removal.

This consists of two declarations, one of them his own.  In this declaration are details supporting the applicant’s standing as a person aggrieved and various other matters which are not in dispute.  What is relevant now, for the purpose of this decision, is the preliminary enquiries to establish if - or to what extent - the mark STARCARD has in fact been used by the registered proprietor or a registered user.

Mr Stevens consulted telephone and business directories, including the Yellow Pages directories, for the three-year period relevant under s 23.  He also arranged for searches to be made of business name directories and checked the annual reports for Caltex Australia for the relevant period.  It transpires that STARCARD is a registered business name of Caltex Australia in most states and territories.  The business described is, in all instances, “wholesale and retail marketing and card services of petroleum products” (emphasis added in Mr Stevens’ declaration).  Mr Stevens also found a listing in the 1994 and 1993 white pages for Sydney, but nothing for 1991 or 1992.  A second declaration, by an employee of the firm, Ms Busby, takes up the story at this point. 

Ms Busby rang the number listed in the white pages, a 008 listing for STARCARD/STARFLEET.  As she puts it:  “the purpose of my telephone call was to ascertain the nature of the services provided by Caltex (Australia) Pty Ltd under the trading name STARCARD.”  What her enquiry found was that Caltex Australia Pty Ltd was, at the time when the phone call was made, offering a customised credit card facility, with a 24 hour a day telephone support line.  This she found out directly, from the answers of Mr James Cahill, Card Account Manager (NSW) of Caltex Australia.  Mr Cahill undertook to forward information on the “the services provided by his company under the trade mark STARCARD”, and this he did.

Mr Wilson was highly critical of this approach to establishing a prima facie case.  He noted that, save for some phone books and for some business name registrations, the applicant had made a specific enquiry of a person who worked in the card account area of a firm which was, after all, only the registered user of the trade mark.  That enquiry was itself directed to services rather than goods.

Mr Stevens responded that a generalised approach was reasonable given the difficulties faced by anyone attacking a class 9 registration.  What is the relevant trade?  Where does one start?  Surely, he argued, in the case of a non-specific registration, generalised enquiries should be enough to shift the onus onto an opponent?  And who better to approach than the registered user, available via an information line listed in public phone directories.

While some of these things may be so, I do not entirely agree with this argument.  Mr Wilson directed several criticisms at it during the course of the hearing but ultimately his first criticism is the most telling.  The applicant could have, instead of addressing the totality of class 9, addressed only the goods in which it itself has an interest.  However, both parties also had several contingency positions to fall back to and, in the interests of completeness, some of them should be noted.

In the first place, Mr Stevens conceded, on the authority of the VISA case, 1985 RPC 331, that the trade mark STARCARD has been used on credit cards, as distinct from credit card services. Mr Wilson also argued that the mark has been used to conduct a trade in diskettes and tapes bearing recorded information, those diskettes and tapes being sold to clients who wished to obtain a detailed listing of their own transactions.

Both sides also addressed the question of the discretion left to me under s 23 to refuse to remove the registration even if a case of non-use has been established.  In particular, Mr Wilson made submissions on the similarities in the natures of some credit cards, the so-called “smart” cards, to the goods in which the applicant trades.  These were, he argued, “goods of the same description” so that there was a public interest in keeping the opponent’s registration on the register, preventing use by the late-comer.  Mr Stevens, on the other hand, argued that there was a clear practical difference between the goods of the applicant and the opponent, so that in practical terms the opponent would suffer no real inconvenience from a partial restriction of its registration.

Let me say at this point that I realise the thorough undesirability of leaving an unused trade mark on the register.  Mr Stevens referred me to Mercury Communications Ltd v Mercury Interactive (UK) Ltd, 1995 FSR 850, on this point, but it applies in any case as a matter of common sense. An unused trade mark should be removed, as is said by McLelland J in Ritz Hotel v Charles of the Ritz 12 IPR 417 at 481:

The court's powers to order rectification of the register under s22(1) and to order the removal of a trade mark under s23(1) are in each case of a discretionary nature.  This is the natural and ordinary meaning of the words used and promotes the underlying policy of the Act by giving the court a sufficient degree of flexibility to give effect to public interest considerations.  The existence of a discretion to withhold relief even if a ground for rectification or removal has been made out is also well established by authority ...

The proper approach under both ss22(1) and 23(1) is that if the condition of exercise of the court's power has been established, the entry of the mark should be expunged, or the mark should be removed, as the case may be, 'unless sufficient reason appears for leaving it there' ..."

Decisions of this office have shown that the registrar’s discretion is exercised in the same way.  Also, it is clear that a needlessly broad registration is nearly as undesirable as an unused one.  None the less, I cannot put the opponent to any trouble in this case.

The application has been supported by evidence which is very different from that which the courts have envisaged.  Mr Wilson noted the classic case of Estex Clothing Manufacturers Pty. Limited v. Ellis and Goldstein Limited, the Estex case, 116 CLR 254 at 258:

It is for the applicant who seeks to have a mark removed to prove his case.  The onus is on him to show an absence of use in good faith during the period.  If persons who, by reason of their connexion with the relevant trade, might be expected to have seen or heard of the mark if it were used as a trade mark upon goods for which it is registered, swear that they had not seen or heard of it in use as a trade mark at any time during the relevant period, that is prima facie evidence of the fact which the applicant must prove.  Slight evidence may suffice at this stage, for the applicant has the task of proving a negative and the registered proprietor is probably in a better position to prove user than is the applicant to prove non‑user.

I appreciate the argument that Mr Stevens used here.  The applicant knew that it was dealing with a registration for a mark which had been used in trade.  It thus began its enquiries from that point, and in such a case there are perhaps many alternatives to the trade declarations referred to in Estex.  The applicant’s questions were quite reasonably directed to the registered user and, had they been a little broader, might have done the opponent’s registration some real damage.  Had all of the right questions been asked, it might have been unnecessary to look any further for a prima facie case.  As matters went, however, this was not done.

Why the Card Account Manager of Caltex Australia, the officer of whom the questions were asked by the applicant, should be expected to know anything about goods as diverse as meteorological balloons or electric fences, to refer to my two earlier examples, is not clear to me.  Prima facie, he can be expected to know nothing at all about them.  This must be so, at least prima facie, unless the contrary is shown.  Perhaps it could have been shown had that person been asked, but he was not.  Nor was that officer the sort of person who could reasonably be expected even to know if the proprietor itself was using the registration for trade in goods other than credit cards.  He could have been questioned to throw some light onto that possibility, but he was not.

Accordingly, the only prima facie case that can have been made is in relation to credit or charge cards, and possibly in relation to information recorded on tapes and diskettes.  For any other goods, I think that the application must fail at the first hurdle, the prima facie case referred to in Estex. 

In saying this, I give next to no weight to the information disclosed in the business names registers.  Those registers are prima facie indications of the nature of the business of the firm registered as Starcard.  But what else may either Caltex Australia or Caltex Oil trade in?  What trade marks do they use for those purposes?  With the exception of the perusal of annual reports, the evidence is silent on those questions.  I think it would be extreme to expect that more than a handful of the trade marks in use by a company would be likely to be identified in an annual report, a report which is prepared for different reasons entirely.  I therefore give the same minimal weight to the perusal of those reports as I did to the examination of business names registers.  While “slight evidence may suffice”, as Mr Stevens argued, relying on Estex, this matter is one where slight must be distinguished from insufficient.

Thus, as I have said, the applicant’s prima-facie case has been made in relation to credit card services and credit cards, and perhaps to tapes and diskettes bearing recorded information. 

It is only in relation to credit cards and credit services that Mr Cahill can, on the questions put to him, be expected to have a competent opinion.  Going one step further, “when all the evidence is complete” (Estex, at p 259) I can also agree that Mr Cahill knows something of the trade conducted by Caltex Australia in relation to information recorded on diskettes and cassettes.

As Mr Wilson argued, it is only for goods where a prima facie case has been made that the onus is on the opponent to show use.  He relied on Knickerbox Ltd v Pedita Aust Pty Ltd, 31 IPR 108, at p 115 for this principle, which I accept. However, the opponent has rebutted the entire prima facie case which has been made. This they have done by showing that, in that area, as per the VISA case, there has indeed been use. I accept, let me say, that the opponent conducts a trade in recorded diskettes and cassettes, even though those media are sold still bearing the trade marks of the firms that manufactured the blank recording media in the first place.

Given the limited prima facie case on the one hand and the evidence of use on the other, the application must fail.  I do not think it will therefore be useful for me to deal with the further arguments and fall-back positions of the parties.

Costs
Mr Stevens and Mr Wilson both accept that costs should go against the applicant in the event of a refusal.  Where they differed was as to costs in the event that I ordered the limitation of the registration.  This I have not done.

Conclusion
I dismiss the removal application and award costs, in accord with the official scale, to the opponent.

T. E. Williams
Hearing Officer

22 March 1996