MACH Systems Pty Ltd v BlueScope Steel Limited

[2013] ATMO 40

TRADE MARKS ACT 1995

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

Re:Opposition by MACH Systems Pty Ltd to registration of trade mark application 1414284 (6) - SOLARBOND - filed in the name of BlueScope Steel Limited.

Delegate:	Jock McDonagh
Representation:	Opponent: Mr Roger Farquhar Managing Director MACH Systems Pty Ltd Applicant: Fiona Brittain of Davies Collison Cave
Decision:	40 ATMO 2013 Section 52 opposition to registration – ss 58A, and 62A grounds pressed - no ground of opposition established – application to proceed to registration

Background

1. This matter is an opposition under section 52 of the Trade Marks Act 1995 (“the Act”) to the registration of the trade mark filed by BlueScope Steel Limited (“the Applicant”) details of which appear below:

Application No:	1414284
Priority Date:	14 March 2011
Goods:	Class  6: Prepainted metal building materials; metal roof and wall cladding, ceiling battens, trusses, purlins, structural decking, metal formwork and reinforcing materials for buildings, metal rainwater products; fascias, guttering, ridge capping, downpipe and metal rainwater tanks; metal building frames, framing sections and accessories thereto for houses and commercial buildings; transportable buildings of metal; metal fencing materials; metal fascias, metal channels, metal angles, brackets, clips and clamps, all of metal.
Trade Mark:	SOLARBOND (“the Trade Mark”)

2. The application was examined in compliance with section 31 of the Act and advertised as accepted for possible registration in the Australian Official Journal of Trade Marks on 25 August 2011.

3. On 15 November 2011, MACH Systems Pty Ltd (“the Opponent”) filed Notice of Opposition (“the Notice”) to the registration of the Trade Mark. The Notice is couched in very narrow terms and comprises only grounds under sections 58A and 62A of the Act, both of which were relied upon by the Opponent at the hearing of the matter.

4.   The Opponent bears the onus of establishing at least one of the specified grounds of opposition on the balance of probabilities.[1]

[1] See Pfizer Products Inc v Karam [2006] FCA 1663; 237 ALR 787; (2006) 70 IPR 599; [2006] AIPC 92-146 per Gyles J at [6] to [26]; Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891; (2009) 180 FCR 60; (2009) 258 ALR 545; (2009) 82 IPR 13; [2009] AIPC 92-355 per Sundberg J at [22] to [26]; Sports Warehouse, Inc v Fry Consulting Pty Ltd [2010] FCA 664; (2010) 87 IPR 300 per Kenny J at [30] to [40]; NV Sumatra Tobacco Trading Company v British American Tobacco Services Limited [2011] FCA 1051; (2011) 198 FCR 435; (2011) 283 ALR 743 per Greenwood J at [16] to 32]; Allergan, Inc v Di Giacomo [2011] FCA 1540; (2011) 199 FCR 126; 94 IPR 541 per Stone J at [11] to [12] and most recently Tricarico v Dunn Bay Holdings Pty Ltd [2012] FCA 271 per McKerracher J at [9] to [10] and Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) (2012) 94 IPR 551 per Dodds-Streeton J at [13].

5.   The time at which the grounds of opposition must be established is the date of filing of the application for registration, 14 March 2011.[2]

[2] Southern Cross Refrigerating v Toowoomba Foundry Pty Ltd (1953) 91 CLR 592 at 595

6.   The hearing was before me as a delegate of the Registrar of Trade Marks in Melbourne on 20 March 2013.  The Opponent was not represented by an attorney or lawyer and its Managing Director, Mr Roger Farquhar appeared on its behalf.  Ms Fiona Brittain of Davies Collison Cave Patent and Trade Mark Attorneys represented the Applicant.

7.   It was apparent that not only was the Opponent unrepresented in the hearing, but that it seemed not to have availed itself of professional intellectual property advice at all in its dealings with the Applicant. Thus I was mindful of my general duty to ensure a fair hearing.  This obligation imposed a positive duty on me to give such assistance as was necessary to ensure the proceedings were fair.  Therefore, I allowed Mr Farquhar some latitude in his submissions, even where they bordered on “evidence from the bar table”, that I would not allow to counsel.   However, I was also mindful of my duty not to become the advocate of a self-represented party and kept in mind the need to afford procedural fairness to the other party.

8. The following evidence was filed in accordance with the Act:

Declarant	Position	Date Made	Exhibits
Evidence in Support
Roger Alan Farquhar (“Farquhar 1”)	Managing Director of Opponent	10.02.12	1 to 7
Evidence in Answer
Horace Cavallaro (“Cavallaro”)	Manager Springhill Technical and Metallurgical Technology Mills and Coatings of Applicant	30.05.12
Philip Kennedy (“Kennedy”)	In-house Trade marks Attorney for Applicant	31.05.12	PK-1 to PK-4
Jamie Adams (“Adams”)	Senior Research Assistant of Applicant	05.06.12	JA-1 to JA-4
Fiona Mary Brittain (“Brittain”)	Attorney for Applicant	08.06.12	FMB-1
Evidence in Reply
Roger Alan Farquhar (“Farquhar 2”)	Managing Director of Opponent	04.07.12

Discussion

9.     The evidence shows that The Opponent’s Managing Director, Mr Farquhar, is an inventor who has developed an impressive integrated energy module for use in buildings. While the science of the invention is beyond my ken, it seems that the module uses (amongst other features) glazed solar collectors and thermal exchange ceiling sheeting constructed within the roofing of a building to satisfy a large proportion of the building’s heating requirements.

1. From about 2002, the Opponent and the Applicant (and the Applicant’s predecessor BHP) commenced discussions in relation to the possible commercialization of the integrated energy module incorporating the Applicant’s COLORBOND branded roofing material.

2. The Applicant and Opponent entered a confidentiality agreement in June 2003 in relation to the Opponent’s MACH Systems “Self Sustaining Home”: Farquhar 1 Exhibit 3.2.

3. Minutes of meetings between the parties on 17 July 2003 and 9 July 2004 are exhibited in Farquhar 1 (3.4 and 4.2 respectively). Neither refers to the term Solarbond.

4. However, later documents, such as a discussion paper sent to the Applicant by the Opponent (Farquhar 1 Exhibit 5.3) and an agenda for a meeting between the parties on 18 November 2004 (Farquhar 1 Exhibit 5.7) do include references to the term Solarbond, but without any context other than as a product. Similarly an unsigned draft confidentiality agreement of February 2010, exhibited at Farquhar 1 Exhibit 7.3.2, includes reference to the term Solarbond but not specifying its context.

5. Farquhar 1 also exhibits a number of email exchanges between the parties, which include references to Solarbond in the context of being roofing used in the Opponent’s system. Farquhar 2 also refers to these exchanges, although it should be noted that the declaration is more by way of submissions in response to the Applicant’s evidence. It is not clearly apparent as to who first coined the expression or the context in which it arose.

6. The Applicant’s evidence includes reference to a third party’s offer in March 2011 to sell Australian Trade Mark Registration 1001725 SOLARBOND - in classes 9, 11 and 19 - to the Applicant: Kennedy at [4] and Cavallaro at [3] to [8].

7. In March 2011, the Applicant’s in-house trade mark attorney was tasked with applying for registration of the Trade Mark. He was informed of the recent third party offer. The attorney consequently made a routine search of this office’s ATMOSS trade mark registration database and found no registrations other than that of the third party: Kennedy [3] to [6]. The attorney was unaware of the Opponent’s preliminary discussions with the Applicant until receipt of the Notice: Kennedy [7].

8. Kennedy also details the history of the Applicant’s COLORBOND trade mark and derivatives of it. The Applicant has a history of adopting several –BOND derivative trade marks, including COOLABOND, POWERBOND, GAVABOND, and GALUBOND: Kennedy [19].

   Grounds of opposition

   Section 58A - Opponent's earlier use of similar trade mark

9. Section 58A provides:

   (1)  This section applies to a trade mark (section 44 trade mark) the application for registration of which has been accepted because of:

   (a)  subsection 44(4); or

   (b)  a similar provision of the regulations made for the purposes of Part 17A.

   Note:          Subsection 44(4) prevents rejection of an application for registration of a trade mark that is substantially identical with, or deceptively similar to, a registered trade mark or a trade mark whose registration is being sought where the first‑mentioned trade mark has been continuously used since before the priority date of the other trade mark.

   (2)  The registration of the section 44 trade mark may be opposed on the ground that the owner of the substantially identical or deceptively similar trade mark (similar trade mark) or the predecessor in title:

   (a)  first used the similar trade mark in respect of:

   (i)  similar goods or closely related services; or

   (ii)  similar services or closely related goods;

   before the owner of the section 44 trade mark or the predecessor in title in relation to the section 44 trade mark first used the section 44 trade mark; and

   (b)  has continuously used the similar trade mark in respect of those goods or services since that first use.

   Note:          For predecessor in title see section 6.

10. This ground of opposition only applies to marks that are accepted on the basis of evidence of prior continuous use under sub-section 44(4) of the Act or under a similar provision of the Regulations. Accordingly, the provision is not applicable as the Trade Mark was accepted without evidence of use.

11. Therefore, this ground of opposition is not established.

    Section 62A – Application made in bad faith

12. Section 62A provides:

    The registration of a trade mark may be opposed on the ground that the application was made in bad faith.

    22.  The Opponent contends that the Applicant has violated the confidentiality agreement(s) between the Opponent and the Applicant and that such conduct is in bad faith.

    23.  In Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) [2012] FCA 81; (2012) 94 IPR 551, Dodds-Streeton J, at [164] – [166] held:

    Bad faith, in the context of s 62A, does not, in my opinion, require, although it includes, dishonesty or fraud. It is a wider notion, potentially applicable to diverse species of conduct.

    The formulation in United Kingdom authority of bad faith as falling short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in a particular area is, in my view, an apt touchstone. An overly literal application may, however, tend to negate the relevance attributed to the applicant’s mental state in the combined test preferred in Harrison.

    Further, in my view, mere negligence, incompetence or a lack of prudence to reasonable and experienced standards would not, in themselves, suffice, as the concept of bad faith imports conduct which, irrespective of the form it takes, is of an unscrupulous, underhand or unconscientious character.

    24.  Having regard to the evidence, it is clear that only the signed confidentiality agreement of July 2003 (Farquhar 1 Exhibit 3.2) would seem to be binding on the parties at any time prior to the priority date. The agreement makes no mention of SOLARBOND in any context. The term SOLARBOND only appears in the evidence, particularly in the various email exchanges, in late 2004 and 2005. Again, there is little context as to its use, whether as a trade mark, as a product code-name or in any other capacity.

    25.  Mr Farquhar honestly believes that he is the originator of the term SOLARBOND in his dealings with the Applicant. There is no evidence to contradict the honesty of his belief, and the contrary has not been put to him.

    26. However, there is no clear evidence that trade mark use of SOLARBOND is covered by the confidentiality agreement. Indeed, unlike processes, designs, plans and financial information that obviously require confidentiality, a “trade mark is a sign used, or intended to be used, to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person”: section 17 of the Act.

    27.  The Applicant’s evidence regarding the third party offer to sell a SOLARGARD registration, along with the research by the in-house attorney prior to the filing of the Trade Mark, is also cogent and reliable. The statement of goods in the application confirms the Applicant’s evidence and does not seem to reflect the sort of process invented by the Opponent: other than the “solar” component.

    28.  I am not persuaded that the Opponent has discharged the onus of establishing that the Applicant, as at the priority date, applied for the trade mark in bad faith, in the sense that the relevant officers’ knowledge as at that date was such, in all the circumstances, that persons adopting proper standards would regard the decision to register as in bad faith, or that reasonable and experienced persons in the field would view such conduct as falling short of acceptable commercial behaviour.

    29. It is quite possible that the Opponent, with appropriate intellectual property professional advice earlier in the marketing of his invention, might have been able to secure rights in a name for his invention. It is likewise possible that such professional assistance in his opposition to the registration of the Trade Mark might have adduced relevant evidence to support other grounds of opposition provided in the Act. However, my duty is limited to making a decision in accordance with section 55 of the Act.

    Decision

    30. Section 55(1) of the Act provides:

    Unless the proceedings are discontinued or dismissed, the Registrar
    must, at the end, decide:

    (a) to refuse to register the trade mark; or

    (b) to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;

    having regard to the extent (if any) to which any ground on which the application was opposed has been established.

    Note: For limitations see section 6.

    31. I have found the opposition to be unsuccessful on the grounds raised pursuant to sections 58A and 62A of the Act.

    Costs

    32. In the event that the Applicant prevailed, Ms Brittain sought an award of costs in the Applicant’s favour. As the successful party, the Applicant is entitled to its costs and I accordingly award costs against the Opponent in accordance with Schedule 8 of the Trade Marks Regulations 1995.

    Jock McDonagh
    Hearings Officer
    Trade Marks Hearings
    11 June 2013