Jackel International Limited v Nurture, Inc

[2016] ATMO 70

TRADE MARKS ACT 1995

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

Re:Opposition by Jackel International Limited to application under section 92 of the Act by Nurture, Inc to remove trade mark numbers 681950(3, 5, 16, 28) - HAPPY BABY - in the name of Jackel International Limited

Delegate:	Jock McDonagh
Representation:	Opponent: Tim Allen and Natalia Blecher, of Corrs Chambers Westgarth Lawyers Applicant: Khajaque Kortian and Francesca Colubriale of Spruson & Ferguson Patent and Trade Mark Attorneys
Decision:	2016 ATMO 70 Section 96 opposition to removal application - use established within relevant period only in relation to bibs but no other Class 16 goods – no use established in Classes 3, 5 & 28 ­ Registrar’s discretion not applied –   registration to be partially removed in Class 16 and removed for other classes of goods.

Background

1. This matter is a proceeding under subsection 92(4)(b) of the Trade Marks Act 1995 (‘the Act’) in which by an application filed on 10 May 2012, Nurture, Inc (‘the Applicant’) has sought the removal from the Register of the trade mark  appearing below in respect of all of the goods for which it is registered:

Trade Mark number	681950
Trade Mark	HAPPY BABY     (‘the Trade Mark’)
Registered from	29 December 1995
Goods	Class 3: Bleaching preparations and other substances for laundry use; detergents; cleaning, polishing, scouring and abrasive preparations; soaps; perfumery, essential oils, cosmetics, hair lotions; dentifrices; powders; bath salts; preparations for skin care; shampoos Class 5: Pharmaceutical, veterinary and sanitary preparations; dietetic substances adapted for medical use, food for babies; plasters, materials for dressings; material for stopping teeth, dental wax; disinfectants; food preparations in this class; medicinal drinks; fungicides, food for babies; inhalants including eucalyptus; preparations for teething; bath preparations; nappy liners Class 16: Paper, cardboard and goods made from these materials, not included in other classes; printed matter; bookbinding material; photographs; stationery; adhesives for stationery or household purposes; artists' materials; paint brushes; instructional and teaching material (except apparatus); plastic materials for packaging (not included in other classes); playing cards; nappies; tissues; bibs; baby wipes; nappy liners Class 28: Toys, games and playthings; gymnastic and sporting articles not included in other classes; decorations for Christmas trees; activity toys; rattles

1. On 24 August 2012, Pipsan Holdings Victoria Pty Ltd (later amended to Jackel International Limited (‘the Opponent’) filed a Notice of Opposition to the removal.

2. The matter came before me, as a delegate of the Registrar of Trade Marks, for hearing in Canberra on 20 April 2016.  Tim Allen and Natalia Blecher, of Corrs Chambers Westgarth Lawyers, appeared for the Opponent by video link. The Applicant was represented by telephone by Khajaque Kortian and Francesca Colubriale of Spruson & Ferguson Patent and Trade Mark Attorneys.

Evidence

1. The parties filed and served the following declarations in evidence:

Declarant	Status	Date, Known as	Exhibits
Evidence in Support
Paul Frederick Turner	Director of Opponent	21.02.13 “Turner 1”	PT-1 to PT-46
Belinda Palviainen	Product Manager of Happy Baby goods for predecessor in title to Opponent	22.02.13 “Palviainen”	BP-1 to BP-8
Myrna Taouil	Solicitor for Opponent’s Attorneys	25.02.14 “Taouil 1”	MT-1 & MT-2
Evidence in Answer
Paul Blanket	Lecturer in Advertising and Marketing	13.02.14 “Blanket”	PLB-1 to PLB-4
Evidence in Reply
Myrna Taouil	Solicitor for Opponent’s Attorneys	13.06.14 “Taouil 2”	MT-3 & MT-4
Paul Frederick Turner	Director of Opponent	17.07.14 “Turner 2”	PT-47 to PT-50
Myrna Taouil	Solicitor for Opponent’s Attorneys	17.07.14 “Taouil 3”	MT-5 to MT-7

1. It is also a matter of record that the Opponent is the proprietor of the following trade marks:

Trade Mark No.	Trade Mark	Goods	Priority Date
681952	HAPPY BABY	Class 10: Surgical, medical, dental and veterinary apparatus and instruments excluding incontinence sheets; orthopedic articles; suture materials; soothers and pacifiers; teething rings; teats; gloves; droppers; feeding bottles and parts therefor	29.12. 1995
681954	HAPPY BABY	Class 25: Clothing, footwear, headgear and bibs but excluding nappies of cloth or textile	29.12. 1995
895750	HAPPY BABY SMILIE	Class 10: Surgical, medical, dental and veterinary apparatus and instruments excluding incontinence sheets; orthopedic articles; suture materials; soothers and pacifiers; teething rings; teats; gloves; droppers; feeding bottles and parts therefor	21.11.2001
1151438	HAPPY BABY	Class 21: Domestic and household containers and utensils; cups, plates, bowls, storage pots and storage containers; containers and utensils for babies and infants; baby and infant feeding and non- spill cups; bottles; bottle holders; tumblers; jars; caps, spouts and closures for cups, including baby and infant feeding cups, for bowls, for bottles, including bottles for feeding babies and infants, and for jars and tumblers	7.12.2006
1231243	HAPPY BABY	Class 24: Textiles and textile goods, not included in other classes; bed and table covers	25.03.2008

Discussion

1. Section 92 relevantly states:

92Application for removal of trade mark from Register etc.

(1)Subject to subsection (3), a person may apply to the Registrar to have a trade mark that is or may be registered removed from the Register.

(2)The application:

(a)must be in accordance with the regulations; and

(b)may be made in respect of any or all of the goods and/or services in respect of which the trade mark may be, or is, registered.

(3)An application may not be made to the Registrar under subsection (1) if an action concerning the trade mark is pending in a prescribed court, but the person may apply to the court for an order directing the Registrar to remove the trade mark from the Register.

Note:For prescribed court see section 190.

(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)… ;

(b)that the trade mark has remained registered for a continuous period of 3 years ending one month before the day on which the non‑use application is filed, and, at no time during that period, the person who was then the registered owner:

(i)used the trade mark in Australia; or

(ii)used the trade mark in good faith in Australia;

in relation to the goods and/or services to which the application relates.

1. Section 100(1)(c) of the Act provides that the opponent bears the onus of rebutting the allegation made against it under s.92(4)(b), which it may do by, inter alia, establishing that the trade mark, (or, per s 100(3)(a), the trade mark with additions or alterations not substantially affecting its identity), was used in good faith during the relevant period.  I proceed on the basis that the relevant standard of proof is on the balance of probabilities.

2. The use must be genuine commercial use in accordance with the test in Imperial Group Ltd v Philip Morris & Co[1].  A single bona fide use of the trade mark during the non-use period is sufficient to resist an application for removal: Woolly Bull Enterprises Pty Ltd v Reynolds[2].  However, Wilberforce J, in Nodoz Trade Mark[3] (Nodoz), said that if a registered owner relies on one single act of use of the trade mark, then that single act ought to be established by “if not conclusive proof, at any rate overwhelmingly convincing proof.”

   [1] [1982] FSR 72

   [2] [2001] FCA 261; (2001) 51 IPR 149 at [17]

   [3] (1962) RPC 1 at 7.

3. The tribunal may not be persuaded by evidence that is solely from the internal files of the opponent: Nodoz, supra; or of a circumstantial nature: Trina Trade Mark[4]; although one invoice, if genuine, will suffice: Geo W McPherson v Remington[5].

   [4] [1977] RPC 131.

   [5] (1999) 47 IPR 636

4. As the application for removal was filed on 10 May 2012 the relevant period (‘the relevant period’) for the purposes of s 92(4)(b) is the three years ending on 10 April 2012.

5. It was essentially agreed by both parties that evidence of use of the Trade Mark during the relevant period had been established for the following goods:

• Soothers (Class 10)

• Teethers and teats (Class 10)

• Babies’ bottles (Classes 10 and 21)

• Bibs (Class 25)

• Disposable bibs (Class 16)

• Cups, bowls, storage pots, snack pots, freezer trays, utensils, etc, (Class 21)

• Steamers (Class 11)

• Snappi Nappy fasteners

1. The Opponent also submitted that the evidence demonstrated use of the Trade Mark with respect to recipes in Class 16.

2. The Opponent further submitted that the Registrar should exercise her discretion to preserve the registration of the Trade Mark  in respect of:

• Sanitary preparations; food for babies; food preparations in this class; dietetic substances adapted for medical use; preparations for teething; nappy liners in Class 5;

• Recipes in Class 16, in the event these goods have not been used in the relevant period;

• nappies; baby wipes; nappy liners in Class 16; and

• teething toys for babies in Class 28

1. At the hearing, Mr Allen particularly emphasized that the Opponent sought that the Registrar exercise her discretion to maintain the registration of food for babies; food preparations in this class; dietetic substances adapted for medical use; in the specifications for goods under the Trade Mark.

2. The Trade Mark has been cited against the Applicant’s applications for registration of HAPPY BABY for similar goods in Classes 5 and 29, the Applicant understandably opposes such exercise of the Registrar’s discretion.

Trade Mark Use

1. As discussed above at [11], the Trade mark was demonstrated as being used on disposable bibs in class 16 within the relevant period.

2. While the other items in [11] were used under as a trade mark within the relevant period, I am not satisfied that they were used  under the Trade Mark, rather they were used under different registrations owned by the Opponent that I tabulated under [5] above.

3. While the Snappi nappy fasteners were shown advertised amongst the Opponent’s product lines during the relevant period, I note that such goods do not fall under any of the classes of goods specified for the Trade Mark, nor for any of the registrations shown in [5]. Such fasteners are more properly Class 26 goods.

4. The Opponent submits that it has used the Trade Mark on recipes, being printed matter in Class 16. I note that such recipes were invariably shown as ‘free recipes’ in conjunction with either the packaging of Class 21 goods with registration 1151438 HAPPY BABY (see [5] above) or on-line as part of promotions for such goods. Turner 1 details such use of recipes as part of the Opponent’s marketing and evolution of its product range. I consider that the recipes were not goods; rather they were part of the marketing, packaging and get up of the Class 21 goods.

Registrar’s Discretion

1. Under s 101(3) of the Act, the Registrar has the discretion not to remove a trade mark from the Register even though the grounds on which the removal application was made have been established. A broad range of circumstances may be taken into account in exercising the discretion. The Opponent bears the onus of demonstrating the existence of circumstances that need not be “exceptional circumstances”[6], but will need to be sufficient to satisfy the Registrar that application of the discretion is reasonable.

   [6] Kowa Company Ltd v NV Organon [2005] FCA 1282; (2005) 66 IPR 131, per Lander J at [98].

2. The Full Federal Court, in Austin, Nichols & Co Inc v Lodestar Anstalt[7], confirmed the proper test as “[t]he question to be asked is whether it [is] reasonable not to remove the trade mark from the Register, although the trade mark had not been used during the statutory period”. In Tivo Inc v Vivo International Corporation Pty Ltd[8] Dodds-Streeton J summarized some relevant considerations for the exercise of the discretion:

   In Austin, the Full Court affirmed that Flick J’s view that while public interest, particularly in the integrity of the Register, was the guiding principle behind the discretion, the private commercial interests of parties could be taken into account and the interests of both consumers and traders must be recognised (at [33]-[34]).

   In E&J Gallo, Flick J identified (at [202]) the following factors additional to that in s 101(4) which, while not exhaustive, were also relevant to the exercise of the discretion: whether there has been no abandonment of the trade mark; whether the registered proprietor still had a residual reputation in the mark; whether there had been sales by the registered proprietor in relation to the goods for which removal was sought since the relevant period ended; whether the applicants for removal had entered the market without having taken steps to ascertain from the Register whether anyone had a right to exclude their use of the mark; and whether the registered proprietors were aware of the applicants’ sales under the mark.

   In Austin, the Full Court confirmed that the discretion under s 101(3) was limited only by the statutory purposes and “whether the removal of the [relevant mark] would lead to deception or confusion... was plainly a relevant consideration to be taken into account” (at [31]). The Full Court also recognised that evidence showing a lack of deception or confusion should the mark remain on the Register was relevant to the exercise of the discretion, but it was not erroneous to find that circumstance an insufficient justification for its retention.

   [7] [2012] FCAFC 8 (21 February 2012).

   [8] [2012] FCA 252 (19 March 2012).

3. Section 101(4) of the Act allows the Registrar to take into account whether the Trade Mark has been used by the Opponent in respect of similar goods or closely related services.

4. As discussed above, the Opponent submitted that the Registrar should exercise her discretion to preserve the registration of the Trade mark  in respect of:

• Sanitary preparations; food for babies; food preparations in this class; dietetic substances adapted for medical use; preparations for teething; nappy liners in class 5;

• Recipes in class 16, in the event these goods have not been used in the relevant period;

• nappies; baby wipes; nappy liners in Class 16; and

• teething toys for babies in Class 28

1. Having taken into account the relevant authorities, the evidence – in particular Palviainen on the 2007-2008 Roadmap – and submissions from the parties, I do not consider that exercising the Registrar’s discretion is appropriate for any of the unused goods sought by the Opponent.

2. As I have already discussed, the recipes are not goods in the course of trade, rather are part of the packaging and marketing of other goods for which the Opponent owns appropriate registrations in the areas of baby products and baby accessories.

3. The remaining unused specifications, save for food for babies; food preparations in this class; dietetic substances adapted for medical use, are the same as or similar to the specifications for goods for which the Opponent owns appropriate trade mark registrations.

4. Turning to food for babies; food preparations in this class; dietetic substances adapted for medical use, I note that the Opponent submits that its products occupy neighbouring sub-categories of the baby product market as baby food. It suggests that consumers would consider goods under the Trade Mark as falling within the same general category as baby food.  The Opponent submits that the Trade Mark has enjoyed a very high level of commercial success over many decades that has given rise to a substantial level of reputation in that mark.

5. The Opponent submitted further that if the Applicant were to obtain registration of HAPPY BABY for baby food, such registration would be likely to cause widespread consumer confusion. For the reasons set out below, I consider that the Opponent should exercise other remedies under the act in the event that the Applicant was to gain such a registration.

6. I cannot see any public interest in leaving a trade mark on the Register which appears, on the evidence and submissions before me, not to have been used in Australia for the relevant goods (save disposable bibs) for some 20 years. The Opponent has other trade marks registered for the items it has used in the course of trade in Australia, and has remedies available under the Act to oppose registration of other trade marks that might cause confusion in the Australian marketplace.

Decision and Direction

1. Section 101 of the Act relevantly provides:

   101Determination of opposed application—general

   (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;

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

3. I have decided that the Trade Mark is to be removed from the Register for all goods in respect of which it is registered other than ‘bibs’ in Class 16.

4. Absent an appeal from either party filed within the required time, I direct that the Classes 3, 5 and 28 specifications be removed in their entirety and the Class 16 specification be amended to remove all goods other than ‘bibs’.  If such an appeal is filed, the disposition of the application for removal should be in accordance with the Court’s order or direction.

Costs

1. The Applicant has been substantially successful in relation to the application for removal of the Trade Mark, whereas the Opponent has only been successful in retaining the registration for one type of goods. I direct that costs in relation to the opposition be awarded against the Opponent in accordance with Schedule 8 of the Trade Marks Regulations 1995.

Jock McDonagh
Hearings Officer
Trade Marks Hearings
12 September 2016