Mad Mex International Pty Ltd

[2022] ATMO 151

TRADE MARKS ACT 1995

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

Re:Trade mark application number 2087928 (Class 29) – NAKED BURRITO – in the name of Mad Mex International Pty Ltd.

Delegate:	Blake Knowles
Representation:	Applicant: Mills Oakley Lawyers.
Decision:	2022 ATMO 151 Request to be heard under section 33(4) of the Trade Marks Act 1995 (Cth) in relation to grounds for rejection under ss 41 and 44 – s 44 ground for rejection withdrawn - trade mark not inherently adapted to distinguish for some goods – evidence of use insufficient – goods amended – registration to proceed for remaining goods.

Background

1. This is a decision on examination of trade mark application number 2087928 (‘Application’) filed by Mad Mex International Pty Ltd (‘Applicant’). The Application was filed on 13 May 2020 (‘Relevant Date’).

2. The Application is for the trade mark NAKED BURRITO (‘Trade Mark’) in respect of:

   Class 29: Meat; fish-based foodstuffs; poultry, not alive; game, not alive; meat extracts; fruit, preserved; fruit, processed; vegetables, dried; vegetables, cooked; vegetables, processed; jellies for food; jams; compotes; eggs; milk and milk products; oils for food; edible fats; fish meal for human consumption; frozen meals consisting primarily of meat, fish, poultry or vegetables; fruit-based desserts; dairy-based desserts; prepared meat; prepared meat dishes; fruit salads; vegetable salads; meat salads; prepared meat products; soup

   (‘Applicant’s Goods’)

3. The Trade Mark was examined as required by the Trade Marks Act 1995 (Cth).[1] The examiner raised a ground for rejection under s 41 on the basis that the Trade Mark was not to any extent inherently adapted to distinguish the Applicant’s Goods and therefore fell for consideration under s 41(3). The examiner also raised a ground for rejection under s 44 on the basis that the Trade Mark was deceptively similar to the following trade marks (‘Cited Marks’) which cover goods that the examiner considers to be similar to the Applicant’s Goods:

   [1] Unless otherwise stated, each reference to a section or regulation is a reference to a section of the Trade Marks Act 1995 (Cth) (the ‘Act’) or regulation of the Trade Marks Regulations 1995 (Cth) (the ‘Regulations’).

   Trade Mark Number:             892080

   Trade Mark:  NAKED

   Goods:  

   Class 32: Beers; mineral and aerated waters and other non-alcoholic drinks; fruit drinks and fruit juices; syrups and other preparations for making beverages

   (‘080 Goods’)

   Priority Date:  15 October 2001

   Trade Mark Number:             1847547

   Trade Mark:  NAKED

   Goods:  

   Class 32: Health foods in this class consisting primarily of dairy

   (‘547 Goods’)

   Priority Date:  25 May 2017

4. The Applicant subsequently filed submissions and evidence in response to the examiner’s report. The examiner maintained both grounds for rejection.

5. The Applicant requested a hearing by written submissions and paid the relevant fee. Written submissions were filed on behalf of the Applicant by Mills Oakley Lawyers. I have decided this matter as a delegate of the Registrar based on the material on file, including the evidence and submissions filed by the Applicant.  

   Evidence

6. The Applicant relies on a declaration by Clovis Young, director of the Applicant, made on 8 February 2022, with Exhibits CY-1 to CY-7.

7. Mr Young declares that the Applicant operates a chain of Mexican restaurants and that its first restaurant opened in December 2007. As of January 2022, the Applicant had 61 stores across Australia. The annexures to the declaration indicate that the Applicant’s restaurants operate under the trade mark MAD MEX (‘Primary Brand’).

8. Mr Young declares that the Trade Mark was first used in December 2007 and has been continuously used in relation to the Applicant’s Goods since this time. The Applicant is also the owner of trade mark registration number 1508705 for the Trade Mark, covering Class 30: Burritos and Class 43: Restaurant services for the provision of fast food; restaurants (‘Existing Registration’). The Existing Registration was accepted under the provisions of the former s 41(5), meaning it was considered to be to some extent inherently adapted to distinguish.

9. Mr Young declares that the Trade Mark is promoted on the Applicant’s website. The following is an illustrative example of such use:

10. The Trade Mark also appears on the Applicant’s online menu, being the name of one of the menu items offered. Other menu items that appear in an identical font size and style to the Trade Mark include Burrito, Grande Melt, Quesadilla, Nachos, and Tacos. Mr Young also provides copies of in store menu boards and earlier printed and digital menus, which indicate the Trade Mark is used in the same context as other menu items, for example:

11. Mr Young declares that the Trade Mark is promoted extensively each January under the ‘Naked January’ campaign. Mr Young annexes copies of the Applicant’s roll-out briefs together with printouts of the Applicant’s menu boards for the 2011-2012 campaigns. Also annexed are marketing brief targeting gyms, a list of gyms the Applicant has partnered with, and some shopping centre posters.

12. Mr Young declares that the Trade Mark has been referred to in various articles and annexes copies of online articles from various sources published between 2011-2019. As an illustrative example, I note that one article titled Takeaway Truth: Mad Mex “Naked Burrito” by Chris Jager that appeared on the website on 20 June 2013 states “As its name implies, Mad Mex’s Naked Burrito is a bowl of burrito fillings minus the bread wrap”. I also note that each of the articles also refers to the Applicant’s Primary Brand.

13. Mr Young annexes examples of the Trade Mark being used by third parties in online reviews, blogs, and social media between 2011-2021. Mr Young also indicates that the Applicant’s restaurants have been the recipient of numerous media and business awards.

14. Mr Young provides revenue figures for the Applicant’s Goods sold under the Trade Mark for the years 2019 to 2021.  Mr Young also provides “total approximate revenue that can be attributed to the sale of the Goods and Services covered by the Trade Mark since 2007”, and “advertising expenditure for the Goods covered by the Trade Mark”. The figures provided are substantial. In addition, Mr Young provides projected revenue figures for FYE 2022-2023 which are also significant.

    Discussion

    Section 44

15. A ground for rejection under s 44 may exist where there is at least one pending or registered trade mark with a priority date earlier than the priority date of the Application (i.e. the Relevant Date) in the name of a person other than the Applicant. The earlier mark must be filed or registered in respect of goods that are similar to the Applicant’s Goods, or services that are closely related to the Applicant’s Goods. Further, the earlier mark must be either substantially identical or deceptively similar to the Trade Mark.

16. The basis for the examiner’s objection was that the Cited Marks were wholly contained within, and constituted the essential feature of, the Trade Mark. The examiner also considered that similarity existed between the fruit-based goods contained in the Applicant’s Goods and the fruit beverages of the 080 Goods, and the dairy based goods of the Applicant’s Goods and those of the 547 Goods.

17. I will first consider the issue of deceptive similarity. The test for whether trade marks are deceptively similar requires that one trade mark so nearly resemble another that it is likely to deceive or cause confusion.[2] In determining deceptive similarity, I am guided by the following principles:

    -There must be a real, tangible danger of confusion, not just a mere possibility.[3]

    -Likelihood of confusion can be established if a number of consumers would be caused to wonder whether the applicant’s goods or services come from some other source. It is enough if the ordinary person entertains a reasonable doubt.[4]

    -The impression of the respective marks as a whole must be considered, including the size and prominence of word and device elements and their relationship to each other.[5] However, deceptive similarity can also be found where one mark uses an essential feature of the other.[6]

    -Consumers may retain an imperfect recollection of a mark or its essential features.[7]

    -It may be relevant that an element of the trade marks under consideration is descriptive. However, descriptiveness does not preclude a finding of deceptive similarity.[8]

    -The impression of the mark on ordinary consumers is relevant, not the impression on those who are particularly perceptive or cautious, or those who are exceptionally careless or stupid.[9]

    -It must be considered how the goods or services are ordinarily sold or provided.[10]

    [2] Trade Marks Act 1995 (Cth) s 10.

    [3] Southern Cross Refrigerating v Toowoomba Foundry (1954) 91 CLR 592, 595 (Kitto J).

    [4] Coca‑Cola Co v All‑Fect Distributors Ltd [1999] FCA 1721, [39] (Black CJ, Sundberg and Finkelstein JJ); Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 595 (Kitto J).

    [5] Optical 88 Ltd v Optical 88 Pty Ltd (No 2) [2010] FCA 1380, [100] (Yates J); Crazy Ron's Communications Pty Ltd v Mobileworld Communications Pty Ltd [2004] FCAFC 196, [91]-[103] (Moore, Sackville, and Emmett JJ).

    [6] Saville Perfumery Ltd v June Perfect Ltd (1941) 58 RPC 147, 174-5 (Viscount Maugham); De Cordova v Vick Chemical Co (1951) 68 RPC 103, 105-6 (Lord Radcliffe).

    [7] Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd [2004] FCAFC 196, [79] (Moore, Sackville, and Emmett JJ).

    [8] Lift Shop P/L v Easy Living Home Elevators P/L [2014] FCAFC 75, [64] (Besanko, Yates, and Mortimer JJ).

    [9] Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641, 658 (Dixon and McTiernan J).

    [10] Ibid.

18. Often, the presence of one mark entirely within another will render those trade marks as being deceptively similar. However, each case must be considered on its merits having regard to the appearance, sound, and meaning of the respective trade marks as a whole. When one looks at the Cited Marks, the dominant concept conveyed by the word ‘naked’ solus is human nudity. In contrast, the concept of the Trade Mark is clearly a naked burrito, i.e. a burrito without its tortilla cover. In this context, the term NAKED in the Trade Mark acts as a modifier of the following word BURRITO. Given the examiner’s research indicates that the Trade Mark is a known and oft used term in the market, I do not consider that consumers are likely to recall the word NAKED independently from the word BURRITO. To put it another way, I do not consider that consumers would assume that the goods in question are BURRITOS sold under the ‘NAKED’ brand. I also note that there is a significant degree of co-existence of NAKED trade marks in classes 29 and 32 for similar goods. While the state of the Register is not a decisive factor in itself and does not always reflect market reality, it is mostly consistent with my view that there is not a real, tangible danger of confusion between the Trade Mark and either of the Cited Marks.    

19. As I am not satisfied that the Trade Mark is deceptively similar to either of the Cited Marks, I withdraw the ground for rejection under s 44.

    Section 41

20. Section 41 requires that the Trade Mark be rejected if I am satisfied that it is not capable of distinguishing the Applicant’s Goods from those of other traders. The Trade Mark is to be first assessed under s 41 having regard to its level of ‘inherent adaptation’ to distinguish. If the Trade Mark has sufficient inherent adaptation to distinguish the Applicant’s Goods, there will be no grounds for rejection under s 41. If I am satisfied that the Trade Mark does not have sufficient inherent adaptation to distinguish the Applicant’s Goods, I must determine whether it has any inherent adaptation to distinguish. If the Trade Mark has no inherent adaptation, it must be rejected only if I am satisfied that it did not in fact distinguish the Applicant’s Goods based on the extent of its use at the Relevant Date (s 41(3)). If the Trade Mark has some inherent adaptation to distinguish, it must be rejected only if I am satisfied that due to the combined effect of the level of inherent adaptation of the Trade Mark, the extent of use of the Trade Mark at the Relevant Date and/or intended use thereafter, and/or other relevant circumstances, the Trade Mark did not or would not distinguish the Applicant’s Goods (s 41(4)).

21. The test to determine whether a trade mark is inherently adapted to distinguish was set out by Kitto J in Clark Equipment Co v Registrar of Trade Marks (‘Clark Equipment’):

    His Lordship said: “The applicant's chance of success in this respect (i.e. 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 connexion 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. (1913) 1 Ch 446, at p 463; (1913) 30 RPC 216, at p 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 connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it.[11]

    [11] (1964) 111 CLR 511, 514.

22. In Cantarella Bros Pty Ltd v Modena Trading Pty Ltd, the High Court recognised that the assessment of inherent adaptation involves a two-step process, first (i) determining the ordinary signification of the sign to those who would purchase, consume, or trade in the goods or services, and (ii) then having determined the ordinary signification, the likelihood of the sign being desired for use by others.[12]

    [12] [2014] HCA 48, [71] (French CJ, Hayne, Crennan and Kiefel JJ).

23. In Urban Alley Brewery Pty Ltd v La Sirène Pty Ltd, the Full Federal Court said:

    In trade mark law, a finding that a “word” mark is not to any extent inherently adapted to distinguish a trader’s goods from the goods of others means that the word, in relation to those goods, serves a purely descriptive function.  The rationale for not allowing such words to be registered as trade marks is that the registration would result in an appropriation of the common stock of language that all should be free to use for its ordinary meaning.[13]

    [13] [2020] FCAFC 186, [51] (Middleton, Yates and Lee JJ).

24. In Austereo Pty Ltd v DMG Radio (Australia) Pty Ltd, Finn J held that:

    Nonetheless words which, though descriptive of the quality or character of goods or services, are not the only or natural words which would be chosen for that purpose can properly be said to have some degree of inherent adaptation to distinguish: [Coats at 984-985]. Distinctly, that a descriptive statement is commonly associated with a particular trader’s goods or services does not, in and of itself, mean that that statement is inherently adapted to distinguish that trader’s goods or services. It may, for example, be naturally applied to goods or services of that type by whomsoever manufactured or supplied: [Coats at 984-985].

    Fifthly, a descriptive word may to a degree be inherently adapted to distinguish because the description itself involves an unfamiliar, obsolete, unexpectedly evocative or purely emotive usage: cf J P Coats at 380; Mark Foy’s Ltd v Davies Coop & Co Ltd (1956) CLR 190 at 194.[14]

    [14] [2004] FCA 968, [38]-[39].

25. The basis for the examiner’s objection is that the Trade Mark indicates that the Applicant’s Goods are ingredients for a burrito without a tortilla wrap. In support of the objection, the examiner also refers to a Macquarie dictionary entry for ‘naked’ which includes the following definition: ‘(of a hamburger, sandwich, burrito, etc) without the bread component; a food substitute often provided; (of a salad without a dressing)’. The examiner also relies on Internet research which indicates the Trade Mark is in use by other traders, particularly in relation to burrito bowls.

26. The Applicant accepts that the Trade Mark is only to some extent inherently adapted to distinguish in relation to goods that can be categorised as ‘prepared meals’. However, the Applicant also submits that the Trade Mark is merely allusive in relation to the remaining goods (defined by the Applicant as ‘foodstuffs’) and that to the extent that any of these may be used as an ingredient in a naked burrito, this is an insufficient connection to deprive the mark of inherent distinctiveness.

27. The Applicant also argues that the methodology adopted by the Macquarie Dictionary for determining new entries has been the subject of judicial comment and criticism. Further, the Applicant submits that any use of the term ‘naked burritos’ by other traders in a descriptive context would not be use that would infringe the Trade Mark (if registered), and it therefore follows that the Trade Mark is distinctive under the test expressed in Clark Equipment.

28. I agree with the Applicant that the ordinary signification of the Trade Mark must be considered in relation to each of the goods individually, and that it is inappropriate to raise a blanket objection applying equally to all of the Applicant’s Goods regardless of their attributes.  

29. A burrito is a Mexican dish consisting primarily of a combination of spiced meat (or a non-meat protein), salad (e.g. tomato, onion, lettuce, avocado), cheese, beans, and sauce, wrapped in a tortilla or served in a bowl. Based on the examiner’s research and my own enquiries, I consider that the Trade Mark has a well understood meaning, being a combination of ingredients that would ordinarily constitute a burrito, without the accompanying tortilla. This descriptive meaning is the Trade Mark’s ordinary signification among those who would trade in or purchase the goods. Even if one ignores the Macquarie Dictionary definition of ‘naked’ cited by the examiner, the examiner’s research demonstrates that the Trade Mark would be legitimately desired for use by other traders based on its ordinary signification.

30. I therefore consider that the Trade Mark falls for consideration under s 41(3) in relation to the items in the Applicant’s Goods which could be interpreted broadly enough to include a ‘naked burrito’ in its final prepared form, namely: frozen meals consisting primarily of meat, fish, poultry, or vegetables; prepared meat dishes; vegetable salads; meat salads (‘41(3) Goods’). I also consider that the Trade Mark falls for consideration under s 41(4) in relation to goods that may be considered ingredients for a ‘naked burrito’, namely: ‘meat; fish-based foodstuffs; poultry, not alive; game, not alive; fruit, processed; vegetables, cooked; vegetables, processed; milk products; prepared meat; prepared meat products’ (‘41(4) Goods’). Such goods may be sold in kits or packages which allow a purchaser to construct their own ‘naked burritos’. As such, while the Trade Mark is not directly descriptive of burrito ingredients, in certain contexts it is descriptive of one of their characteristics and as such is something other traders may legitimately wish to use.  

1. I am also not persuaded by the Applicant’s argument that any use that other traders may wish to make of the Trade Mark in relation to burrito ingredients would be descriptive and not infringe a registered trade mark, thereby rendering the Trade Mark distinctive under the test outlined in Clark Equipment. This argument if followed to a logical conclusion would mean that many highly descriptive terms desired for use by other traders may be considered prima facie registrable.  Further, there is often no clear dichotomy between descriptive use and trade mark use.[15] As such, other traders may desire to use the Trade Mark in a manner that is both descriptive and which also constitutes trade mark use.  

   [15] Moroccanoil Israel Ltd v Aldi Foods Pty Ltd [2017] FCA 823, [146] (Katzmann J).

2. I am not satisfied that the Trade Mark lacks sufficient inherent adaptation in relation to meat extracts; fruit, preserved; vegetables, dried; jellies for food; jams; compotes; eggs; milk; oils for food; edible fats; fish meal for human consumption; fruit-based desserts; dairy-based desserts; fruit salads; soups (‘Other Goods’). These goods are not burritos or realistically likely to be separate ingredients of burritos. As such, there is no basis for the Trade Mark to be rejected for the Other Goods under s 41.

3. I now must consider whether the Trade Mark is registrable in relation to the 41(3) Goods and the 41(4) Goods having regard to the various factors set out in s 41(3) and 41(4), particularly the use of the Trade Mark.

4. The Applicant’s evidence shows that the Trade Mark has mostly been used in a descriptive capacity in relation to a menu item available as part of the takeaway food services provided by the Applicant under the Primary Brand. While the Applicant’s marketing campaigns and references in the media occasionally give some emphasis to the Trade Mark, the context in which it is used is still primarily descriptive and I do not consider that consumers would view the Trade Mark as a badge of origin for the 41(3) Goods and 41(4) Goods. As such, while I accept that the Applicant has sold many ‘naked burritos’ in its restaurants since 2007 and has generated significant revenue from such sales, I do not consider such use is particularly relevant in determining the registrability of the Trade Mark. I am satisfied that the Trade Mark has not, and likely will not, distinguish the 41(3) Goods and 41(4) Goods from those of other traders.

5. I also do not consider that the Existing Registration is a compelling reason to accept the present Application. My decision is based on the information and evidence before me now, which I do not believe supports acceptance of the Trade Mark. If the examiner of the Existing Registration accepted that trade mark on the basis of similar material, I would have respectfully differed in my finding.

6. I am satisfied, after considering the evidence provided by the Applicant, that the Trade Mark is not capable of distinguishing the 41(3) Goods or the 41(4) Goods. However, I am satisfied that the Trade Mark is capable of distinguishing the Other Goods.

   Resolution of application

7. In Apple Inc. v Registrar of Trade Marks, Yates J stated that:

   My finding that the application for registration of APP STORE for the designated services in Class 35 must be rejected determines the fate of the application as a whole. This is because there are no separate applications for registration of the mark for the designated services Classes 38 and 42. There is but one application covering registration of the mark for all the services that have been specified. If the application fails in one respect, it fails as a whole. In these circumstances, is not necessary for me to proceed to determine the registrability of APP STORE for the designated services in Class 38 or Class 42.[16]

   [16] [2014] FCA 1304, [232].

8. In circumstances where grounds for rejection exist in respect of some, but not all, of the goods or services under consideration, the Registrar may proceed to reject the application in its entirety, under the principles outlined above. However, the Registrar also has a discretion to offer an amendment allowing an applicant to amend the application to remove goods or services for which a ground of opposition exists.

9. In view of the above, I offered the Applicant the opportunity to delete the 41(3) Goods and 41(4) Goods from the Application.

10. The Applicant agreed to the proposed amendment, which has now been made. On that basis I find that the trade mark can be accepted for the Other Goods. 

    Decision

11. Under s 33(1), I must accept the Application if I am not satisfied there are grounds for rejecting it. In view of the amendment requested by the Applicant, I am not satisfied there are grounds for rejecting the Application in relation to the Other Goods. Therefore, I accept the Application.

    Blake Knowles
    Hearing Officer
    Delegate of the Registrar of Trade Marks
    02 September 2022