Malina Schindler and Adrian Schindler v Intellectual Property Development Corporation Pty Ltd

[2013] ATMO 36

TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS

Re:Opposition by Malina Schindler and Adrian Schindler to registration of trade mark application 1302789(32) - ZIG ZAG - filed in the name of Intellectual Property Development Corporation Pty Ltd.

Delegate:	Iain Thompson
Representation:	Opponents: Peter Madigan of Counsel instructed by Ross Higgins of Higgins, Lawyers. Applicant: Chris Round, solicitor, of Middletons.
Decision:	2013 ATMO 36 s52 opposition to registration – s42(b) opposition established: trade mark ZIG ZAG if applied to beer made other than in the Zig Zag area of New South Wales would be misleading and deceptive.

Background

1.   Intellectual Property Development Corporation Pty Ltd (‘the Applicant’) has applied under the Trade Marks Act 1995 (‘the Act’) to register the trade mark details of which appear below:

Application No:           1302789
Priority Date:               5 June 2009
Goods:  Class 32: Beer
Trade Mark:                ZIG ZAG

(‘the Application’ or ‘the Trade Mark’ as is appropriate)

1. The Application was examined as mandated by section 31 of the Act and advertised as accepted for possible registration in the Australian Official Journal of Trade Marks on 10 June 2010.

2. On 31 August 2010, Malina Schindler and Adrian Schindler (‘the Opponents’) filed Notice of Opposition (‘the Notice’) to the registration of the Trade Mark.  The Notice is couched in broad terms and includes the grounds argued at a hearing of the matter.

3. The parties subsequently served evidence to support their respective contentions and the matter was heard by a delegate of the Registrar of Trade Marks in Canberra on 3 July 2012.  Peter Madigan of Counsel instructed by Ross Higgins of Higgins, Lawyers, represented the Opponents.  Chris Round, solicitor, of Middletons represented the Applicant.

4. Subsequently, for administrative and operational reasons the matter has been given to me, Iain Thompson, a delegate of the Registrar of Trade Marks, to decide.  I have considered all of the relevant materials including the audio recording of the hearing, written submissions and evidence in reaching my decision.

   Onus

5. The Opponents bears the onus of establishing one or more grounds of opposition on the balance of probabilities.[1] Since, in my consideration, the opposition should on the face of it succeed under subparagraph 42(b) of the Act, it is only necessary to discuss the evidence of the parties inasmuch as it goes to that ground.

   [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]; 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].

6. The date at which the grounds of opposition must be established is the date of filing of the application for registration (‘the relevant date’): see Southern Cross Refrigerating v Toowoomba Foundry Pty Ltd (1953) 91 CLR 592 at page 595.

   Evidence

7. The evidence served and filed in relation to this matter comprises:

   ·    Statutory declaration of Malinda Schindler made on 27 April 2011 (in support)

   ·    Statutory declaration of Philip Charles Withers made on 27 July 2011 (in answer)

   ·    Statutory declaration of Malina Schindler made on 30 June 2012 (in reply)

8. Ms Schindler, in her first declaration, states that she is Managing Director and co-owner of the ‘Zig Zag Brewery’ which has been located at Brewery Lane, Oakey Park, Lithgow, since 1884.  Since Ms Schindler’s evidence weighs heavily on the ground under which I will decide this matter, it merits prolonged attention.  Ms Schindler says the following concerning the history of the brewery:

   The Brewery was built in 1884 by Henry P. Corbett and A. A. Goodare and first licensed in 1888. The site of the Brewery was selected because of the purity of the water that ran in a stream through the property, and combined with the altitude and cooler climate, it was considered to be an excellent place to brew beer.

   The Brewery is situated in a region of NSW known as ‘Zig Zag’ which also includes the Zig Zag Primary School and the renowned Zig Zag Railway, a modern tourist destination that attracts tens of thousands of people from around Australia to the Zig Zag region every year and has done so since its reopening in 1975. It is important to note that the Brewery is pointed out to all tourists as the Railway goes past the Brewery. The Railway was acclaimed as a feat of engineering ingenuity in its day for overcoming the rugged terrain of the Blue Mountains. Likewise, at its completion in 1865 the railway attracted thousands of people to the Zig Zag region to marvel at the railway. The brewery gained its name from this region.

   The Brewery was run successfully by Mr Corbett in conjunction with Mr Goodare, and then Mr Corbett solo until 1896 when it was taken over by Mr Corbett’s step-son, Mr John Alexander Stammers Jones, who expanded the business and turned it into a highly profitable enterprise. It was recorded that during the period that Mr Jones was proprietor of the Brewery, the brewery was turning out 36 hogsheads of beer twice daily. A hogshead was a large cask of beer or ale equalling 54 gallons (250 litres). The Brewery at this time can be calculated as producing 18,000 litres of beer a day, a large amount for a provincial brewery. Now produced and shown to me and marked ‘MS 1’ is a copy of an article entitled ‘Zig Zag Brewery’ from a publication called ‘Back to Lithgow’ as well as relevant pages from The Breweries of Australia: A History. The Brewery was such a success that at John Jones’ retirement in 1927 he had entailed to the Brewery 10 hotels.

   For the first 5 decades the Brewery was named the Zig Zag Brewery until the business changed its name to the Lithgow Brewing Company in 1927 when the business changed hands and came under the ownership of 6 directors, including himself and three directors from Sydney. Over the following 7 years the brewery was resold to various owners until it eventually became Terry’s Brewery. Despite these changes to the ownership, and to the name of the brewery, it appears to have been known generally as the Zig Zag Brewery or affectionately as ‘the Old Zig Zag’ both throughout the local region, in Sydney and even beyond. Now produced and shown to me and marked ‘MS2’ is a copy of an article from the ‘Lithgow Mercury’ newspaper, dated 24 February 1928. Now produced and shown to me and marked ‘MS3’ are copies of several newspaper articles from the Sydney Morning Herald dating from 1932, 1933 and 1934 each referring to beer as coming from the Zig Zag Brewery, rather than Terry’s Brewery as the brewery was then called. Some of these articles are a little illegible given their source.

   Old photographs of the period also show the name Zig Zag was commonly associated with the Brewery through much of the Brewery’s life and figured largely on the Brewery buildings. Now produced and shown to me and marked ‘MS4’ are copies of original photographs showing the Brewery. You will note the inclusion of [the words] ‘Zig Zag’ on the building.

   It was well known as a brewery throughout NSW, and was considered to be state-of-the-art for its time, being constructed on the gravitational principle where, once the hops, malt, water etc was [sic] lifted to the top of the brewery’s 70 foot tower, no further manual labour was required until it was rolled in kegs onto the truck for transportation to hotels and pubs. Fellow-brewers from Sydney regularly visited the Brewery to marvel at its equipment and to view the brewing process first hand. Equipment for the brewery was reportedly sourced from the United States and the United Kingdom. An unnamed newspaper in an article entitled ‘Latest Machinery for Terry’s Brewery’ stated that the brewery was two years ahead of its time, and [a] further unnamed newspaper dated 13 April 1921 observed that the Brewery was, ‘the best equipped brewery in the provinces’. Tooths Brewery, one of the largest breweries in Sydney at the time, were reportedly so impressed by the Brewery that they were intending to buy the Brewery in 1931 when it again came up for sale however the sale fell through. Now produced and shown to me and marked ‘MS5’ are copies of the above newspaper articles.

   Tooth’s was not the only enterprise interested in owning the Brewery. In 1929 Sydney Brewery Ltd was formed to acquire the Brewery, and the RSL of NSW considered purchasing the Brewery in 1946. Now produced and shown to me and marked ‘MS6’ are copies of articles from The Sydney Morning Herald, The Argus (from Melbourne) and The Canberra Times dated 7 May 1946, and a further article also from the Sydney Morning Herald dated 6 November 1929 relating to these potential sales.

   Brewer’s diaries from the Brewery dating from as early as 1888 record amounts of beer and yeast ordered by local and regional publicans. A diary believed to be the account book of Arthur Goodare notes at pages 2-8 under a heading, ‘Orders to go out for beer’, the names of businesses as far away as Mudgee, Brewongle, Gulgong, Sunny Corner, Hill End, Mount Victoria, Hartley Vale and Katoomba proving the reputation of the fledgling brewery. These diaries were copied and returned to their owner.

   It was becoming such a substantial enterprise that hops were grown in the Lithgow area to supply the Brewery, and two smaller breweries operating at the time, with a plentiful supply of fresh produce for the production of the beer. The growing of hops in the local area were undertaken on the 20 acre property of the brewery’s proprietor, Mr A Wyld, known as Magpie Hollow, prior to which hops were sourced from Tasmania. Now produced and shown to me and marked ‘MS7’ is a copy of an article entitled ‘Hops Growing Experiment Near Lithgow’ from the Lithgow Mercury dated within the late 1940s.

   Throughout the life of the brewery the trade mark Zig Zag acquired a strong reputation with the brewing of first class beer. Its reputation was such that the name in association with beer and brewing reached far beyond the Lithgow and Zig Zag regions to Sydney, interstate and even overseas. It was noted as being, ‘one of the most successful country breweries in the Commonwealth’, in an unlabeled newspaper dated 27 October 1927. The newspaper states that, ‘the beer produced has acquired a reputation for the very highest quality throughout several states ....’. The Brewery was regularly reported on in newspapers around Australia including the Sydney Morning Herald, The Argus in Melbourne, the Canberra Times. Now produced and shown to me and marked ‘MS8’ is a copy of the relevant page of a regional newspaper dated 27 October 1927.

   When owner of the Brewery, Mr Jones, understood the importance of the ownership of a successful brand and he subsequently trademarked many of its most popular beer brands of the day in around 1916 and 1917 which included, ‘ZIG ZAG’ and ‘WOMBAT’. The trade mark ZIG ZAG (In bold, heavy Caps.) sic. appeared in the Australian Official Journal of Trade Marks Vol. 11, No. 31: Issue of 1 December 1916 for ‘fermented and spirituous liquors’, the owner being ‘Zig-Zag Brewery’. Now produced and shown to me and marked ‘MS9’ is a copy of the information included in that volume of the Australian Official Journal of Trade Marks as well as a photograph of a beer bottle bearing the WOMBAT trade mark manufactured at the Zig Zag Brewery. The bottle was manufactured prior to the use of labels on beer bottles when all information was embossed into the glass bottle itself.

   The Brewery has been listed in the State Heritage Register since 2001, as having ‘historic significance on a state basis’, being a rare survivor in New South Wales of a surviving brewery complex. The Brewery has also been listed in the Register of the National Trust (NSW). The Department of Environment and Planning recognised the importance of the Brewery site and undertook a survey of the site in the mid 1980s to record all points of interest of the Brewery. The results of this survey were recorded in a document entitled Survey of Historical Sites Lithgow Area. Now produced and shown to me and marked ‘MS 10’ is a copy of the relevant pages within that document.

   In October 1950 the Brewery won a prestigious international award, the 1950 British Empire and Commonwealth Bottle Beer Competition. Such an award would have put the Brewery on the map, particularly around Australia. The Brewery was at the time Terry’s Brewery but was still known as the Zig Zag Brewery or the Old Zig Zag. Now produced and shown to me and marked ‘MS 11’ is a copy of the newspaper article printed at the time in the Bankstown Observer dated 19 October 1950.

9. Ms Schindler goes on to state:

   We are also in the lengthy process of gaining a license from the Office of Liquor, Gaming and & Racing to enable our boutique brewery to brew its own beer onsite.

   We have for some time been in the process of developing the recipes for the beer that we intend selling at our boutique brewery. This process is almost finalised although we intend producing additional types of beer over time. The Brewery is fortunate to have at least one hundred of the original beer recipes used by the Brewers at the Brewery that we are in the process of reviewing with a view to utilising the recipes where possible at the Brewery.

   Since 1996 much research has gone into the appearance of the labels that will be affixed to our product. We are in agreeance that it would be appropriate to use the original beer labels that were produced for the Brewery during its heyday and as such much time has been spent researching those labels and attempting to find any examples that may still exist. In this regard we have advertised our intentions in our local newspaper and asked for the assistance of all people in the region. Now produced and shown to me and marked ‘MS 14’ is an original Zig Zag Ale label we have located as well as a copy of our request in the Lithgow Mercury for memorabilia of the Brewery.

   We have also produced new labels that compliment the original old labels to be used on additional types of beer for which we have been unable to find a copy of an original label. Now produced and shown to me and marked ‘MS 15’ is a printout showing complimentary labels to be affixed to beer produced at the Brewery.

   Plans to renovate the existing original brewery buildings and restoring them to their original appearance and use have been in place for some time. We have consulted experts in relation to the layout of the brewery, procurement of the necessary equipment,[and] costings. Now produced and shown to me and marked ‘MS 16’ is a detailed pamphlet on the Brewery’s intended renovations.

   As a means of gauging public interest in the restoration of the Brewery we have included articles in the local newspapers and exhibits were set up at numerous shows including Bathurst Show, Mudgee Field Day, shows at Orange and Tamworth and shows throughout metropolitan Sydney from 1993 to 2007. At these shows our exhibits included original photographs of the Brewery and we requested comments and suggestions from show goers. Support was overwhelming and we received overwhelming support [sic]with many positive responses and reminiscences from show goers all who recalled the Brewery and were well conversant with its history. Now produced and shown to me and marked ‘MS 17’ is a photograph of the exhibit at the Bathurst Show as well as copies of relevant newspaper articles.

10. Turning to the evidence in answer, Mr Withers states that he is the director of the Applicant.  Mr Withers states:

    Exhibit MS1 of the Schindler Declaration reveals that the ‘Zig Zag’ brewery (Brewery) ceased to be named the ‘Zig Zag Brewery’ in 1928 and that no beer has been produced at the premises owned by the Opponents since 1958. My extensive research into historical beer brands reveals that no beer has been produced anywhere in Australia by reference to the Trade Mark since at least that date and most likely since 1928.

    In paragraph 8 of the Schindler Declaration, Ms Schindler states that the Brewery was renamed Lithgow Brewing Company in 1927 and eventually became known as ‘Terry’s Brewery’ but that ‘despite these changes to the ownership, and to the name of the brewery, it appears to have been known generally as the Zig Zag Brewery or affectionately as ‘the Old Zig Zag’ both throughout the local region, in Sydney and even beyond.’

    In paragraph 17 of the Schindler Declaration, Ms Schindler states, ‘The Brewery was at the time [1950] Terry’s Brewery but was still known as the Zig Zag Brewery or the Old Zig Zag.’

    The Opponents have previously unsuccessfully opposed the registration of the Applicant’s Australian trade mark no. 1246124 TERRY MOUNTAIN (Device). In that opposition, Hearing Officer Deirdre O’Brien determined that the Opponents had not established any of their grounds of opposition and allowed the Applicant’s registration of the mark. Ms Schindler made a statutory declaration on 6 May 2009 that was filed in that Opposition in which she declared at paragraph 19 that:

    In my experience, the Brewery is still often referred to as ‘“Terry’s Brewery’“. I believe that this is due to its strong historical connections with the name ‘Terry’s’ and ‘Terry’s’ brand beer. For example, our Company had a stall at last year’s ‘Bathurst Royal Show’ which was held on the 6th and 7th of March 2008 at the Bathurst Showground in Bathurst, New South Wales. Our Company attend the event to showcase our bottled water products. I noticed that many of the people that came to view our stand referred to the Brewery as the ‘Old Terry’s Brewery’ rather than the ‘Zig Zag Brewery’, even though ‘Zig Zag’ is the name that we now use in relation to the Brewery.

    In paragraph 20 of the Schindler Declaration, Ms Schindler refers to the Opponents’ intention to reopen the Brewery and to the trade marks filed by the Opponents. The Opponents are the registrants of Australian trade mark no. 977925 ZIG ZAG in class 32 for ‘natural spring water’. The trade mark was filed on 12 November 2003 originally for ‘beers and natural spring water’. The Applicant successfully filed an application to remove beer from the specification of goods on the grounds of non-use in the 3 years prior to the application being filed. While the Opponents initially opposed the non-use application, no evidence was filed in support of the use of the mark in the 3 years prior to the non-use application being filed.

11. Mr Withers also states:

    The ICB Group[2] will not use the Trade Mark in a way that will be misleading or deceptive or likely to mislead or deceive. No confusion will arise from the use of the Trade Mark as it will be presented to the public, along with the other ICB Group Trade Marks, from a new boutique craft brewery. The history of the ICB Group Trade Marks is relevant to the success of TRB.[3]

    [2] ICB Group of which the Applicant is a part is an import/export business that operates in Australia, New Zealand, Europe, USA and South Africa.

    [3] Thunder Road Brewing Company (TRB), is located in Brunswick and was expected to open to the public in late 2011. TRB has commenced brewing at the site and its first beer, named Full Steam Pale Lager was recently released to the public

    Subparagraph 42(b)

12. Subparagraph 42(b) provides:

    42Trade mark scandalous or its use contrary to law

    An application for the registration of a trade mark must be rejected if:

    (a) […]

    (b)its use would be contrary to law.

1. In considering whether the use of a trade mark would be contrary to law, hearing officers are obliged to consider whether the use of a trade mark would be contrary to any law.  In Advantage Rent-A-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683; (2001) 52 IPR 24; [2001] AIPC 91-724 Madwick J stated at [26]:

   However, in my opinion the fact that the existence of any contrariety to law is to be exercised in some circumstances by an administrative body and, in other circumstances, by a judicial body does not mean that the phrase ‘if its use would be contrary to law’ should have an ambulatory meaning, depending upon what kind of tribunal is to apply it. Nor can any reticence on the part of an administrative decision-maker to express an opinion on a matter of law be encouraged. The idea that ‘contrary to law’ in the context of judicial proceedings means contrary to all laws, whilst in the context of proceedings before the Registrar it means contrary to laws which are easy for the Registrar to determine or which are ‘“clear cut’“, is not sustainable. As a matter of practice, delegates of the Registrar have in some cases determined that a trade mark submitted for registration is contrary to law as a result of its being in breach of other legislation: see Re Application by Slaney (1985) 6 IPR 307 at 309 where a trade mark was found to be in breach of the Health Legislation Amendment Act 1983 (Cth) and Re Application by Athol Thomas Kelly (1987) 8 IPR 667 at 672 where it was found that the trade mark would infringe the Advance Australia Logo Act 1984 (Cth). I see no reason why some legislation should be able to be relied on before the Registrar to establish contrariety to law and other legislation such as the Copyright Act, albeit more complex, should not. Further, it is well-settled that a power granted to the Registrar and to a court can be at once administrative and judicial depending on who was exercising the power. The High Court so held in R v Quinn; Ex parte Consolidated Foods Corporation [1977] HCA 62; (1977) 138 CLR 1, of a power to remove a trade mark from the Register.

2. Here it is argued by the Opponent that the use of the Trade Mark by the Applicant would mislead or deceive in terms of consumer protection laws.  As the priority date of the Application is before 1 January 2011, the Trade Practices Act 1974 (‘the TPA’) is the relevant legislation, rather than the Competition and Consumer Act 2010 (as was argued before the delegate). Section 52 of the TPA provides:

   Misleading or deceptive conduct.

   52.         (1) A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive.

   (2) Nothing in the succeeding provisions of this Division shall be taken as limiting by implication the generality of sub-section (1).

3. And section 53 of the TPA provides with the relevant subparagraph in bold:

   False or misleading representations

   A corporation shall not, in trade or commerce, in connexion with the supply or possible supply of goods or services or in connexion with the promotion by any means of the supply or use of goods or services:

   (a) falsely represent that goods are of a particular standard, quality, value, grade, composition, style or model or have had a particular history or particular previous use;
   (aa) falsely represent that services are of a particular standard, quality, value or grade;
   (b) falsely represent that goods are new;
   (bb) falsely represent that a particular person has agreed to acquire goods or services;
   (c) represent that goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits they do not have;
   (d) represent that the corporation has a sponsorship, approval or affiliation it does not have;
   (e) make a false or misleading representation with respect to the price of goods or services;
   (ea) make a false or misleading representation concerning the availability of facilities for the repair of goods or of spare parts for goods;
   (eb) make a false or misleading representation concerning the place of origin of goods;
   (f) make a false or misleading representation concerning the need for any goods or services; or
   (g) make a false or misleading representation concerning the existence, exclusion or effect of any condition, warranty, guarantee, right or remedy.

   Note: For rules relating to representations as to the country of origin of goods, see Division 1AA (sections 65AA to 65AN).

4. The Applicant is a corporation to which the TPA applies.

5. In considering the application of section 52 of the TPA, Hill J set out a number of propositions in Equity Access Pty Ltd v Westpac Banking Corporation [1989] FCA 506; (1989) 16 IPR 431; [1990] ATPR 40-994 at [41]:

   1.      For conduct to be misleading or deceptive the conduct must convey in all the circumstances of the case a misrepresentation: Taco Bell[4] at 202. In the present case the misrepresentation on the part of the respondents is said to be that the financial product advertised and marketed by each of them is the product of the applicant or that there is some business relationship between the applicant and each of the respondents or that the applicant has endorsed the respective product of the respondents.

   2. There will however be no contravention of s.52(1) of the Act unless error or misconception results from the conduct of the corporation and not from other circumstances for which the corporation is not responsible: Puxu[5] per Gibbs CJ at p 6 and per Mason J at p 15, Global Sportsman Pty Ltd v. Mirror Newspapers Ltd [1984] FCA 180; (1984) 55 ALR 25, at p 34.

   3.      Conduct will be likely to mislead or deceive if there is a ‘real or not remote chance or possibility’ of misleading or deception regardless of whether it is less or more than 50%: Global Sportsman at p 34. The question of whether conduct is misleading or deceptive or likely to mislead or deceive is an objective question which the Court must determine for itself. Hence evidence that persons in the relevant class have been misled will, although admissible, not be determinative. In some cases however such evidence will be very persuasive: Puxu per Gibbs CJ at pp 198-9.

   4.      Conduct of a corporation causing mere confusion or uncertainty in the minds of the public in the sense that they may be caused to wonder whether two products may have come from the same source is not necessarily coextensive with misleading or deceptive conduct: Puxu at p 100; Bridge Stock Brokers v. Bridges [1984] FCA 391; (1984) 57 ALR 401 at p 413 per Lockhart J. Since actual deception need not be shown the Court must consider whether a reasonably significant number of potential purchasers would be likely to be misled or deceived: Weitmann v. Katies Ltd (1977) 29 FLR 336, 343. The test in passing off cases is usually expressed as being whether a ‘substantial number of persons likely to become purchasers ... are liable to be deceived by the defendant’s use of the name. On the other hand it is not necessary to show that all, or substantially all, persons in the market associate the name with the plaintiff’s goods, if this can be shown of a substantial proportion of persons who are probably purchasers of the goods of the kind in question.’ (per Wilberforce J, as he then was, in Norman Kark Publications Ltd v. Odhams Press Ltd (1962) RPC 163 at 168 and see Saville Perfumery v. June Perfect Ltd (1941) 58 RPC 147 at 175-6, 10th Cantanae Pty Ltd v. Shoshana Pty Ltd (1987) 79 ALR 299 at 315 per Gummow J).

   5.      In a case such as the present the applicant must establish that it has acquired the relevant reputation in the name, that is to say that the name had become distinctive of the applicant’s business in a particular country or geographical area: Sheraton Corporation of America v. Sheraton Motels Ltd (1964) RPC 202; BM Auto Sales Pty Ltd v. Budget Rent A Car System Pty Ltd (1976) 12 ALR 363. However at least in some circumstances very slight activities may be found to be sufficient to establish that a name has become distinctive of a person’s business in a particular country: Miki Shoko Co Ltd v. Merv Brown Pty Ltd (1988) ATPR 40-858.

   6. Section 52 is not confined to conduct which is intended to mislead or deceive: Puxu per Gibbs CJ at p 197 and a corporation which acts honestly and reasonably may none the less engage in conduct that is likely to mislead or deceive: Yorke v. Lucas [1985] HCA 65; (1985) 61 ALR 307 at p 309.

   [4] Taco Company of Australia Inc v. Taco Bell Pty Ltd [1982] FCA 136; (1982) 42 ALR 177

   [5] Parkdale Custom Built Furniture Pty Ltd v. Puxu Pty Ltd [1982] HCA 44; (1981-2) 149 CLR 191)

6. It is the Opponents’ argument that the words ZIG ZAG refer to a region; that beer has been historically produced in that region because of the quality and purity of the water; that the brewery building is still extant and widely recognized as the Zig Zag Brewery and has been listed in the State Heritage Register since 2001.

7. In support of the contention that the name Zig Zag refer to a region, the Opponents have evidenced the name of the brewery – it is still informally known as the Zig Zag Brewery.  The Opponents also draw attention to the name of a primary school and railway.  I note that there is also a Zig Zag Motel and a Zig Zag Railway Station which is in fact in Brewery Lane.  While I do not conclude that the words Zig Zag are the name of a region I am satisfied that the words are widely accepted as being widely connected by a wide section of the Australian public with a particular area and that, via the tourist attraction, known as the Zig Zag Railway, this perception is broadly understood.

8. The supporting materials to Ms Schindler’s first declaration establish that, historically, the water used by the brewery was of particular purity, having been filtered through sandstone and available only on the site of the brewery.  I note that water quality impacts beer in three ways.  Ions in water are critical in the mashing process for all grain brewers, where the character of the water determines the efficiency and flavor of the extracted wort.  Water characteristics also affect the perceived bitterness and hop utilization of finished beer.  Finally, water adds flavor directly to the beer itself because water is the largest single component in finished beer.  The particular quality of the water in the Zig Zag area is incidentally affirmed by the Opponents who bottle mineral water at the old brewery.  I note in relation to this latter observation that the effect of brewing water on beer can be characterized by six main ions in water: carbonate, sodium, chloride, sulfate, calcium and magnesium.

9. A beer takes its particular flavour and character from the water at the site where it is made and bottled: the Zig Zag Brewery is further known to the many thousands of visitors to the Zig Zag Railway which travels past the brewery which, according to Ms Schindler, is pointed out to the visitors as being the Zig Zag Brewery.

10. Accordingly, I consider that use of the Trade Mark by the Applicant would mislead or deceive (or be false or misleading as to origin) because the beer the Applicant proposes to brew under the Trade Mark is not from the Zig Zag area where beers have been made and is widely recognized by the public as being the Zig Zag Brewery. The exhibits to Ms Schindler’s first declaration make it plain that the elevation and water quality in the area known as Zig Zag are particularly suited for beer making. Accordingly, the use of the Trade Mark on beer which does not have those attributes or origin would be misleading or deceptive in terms of subsection 52(1) of the TPA or be false or misleading as to origin in terms of subparagraph 53(eb) of the TPA.

11. The Opponents have established their opposition under subparagraph 42(b) of the Act.

    Decision

12. Subsection 55(1) provides:

    55Decision

    (1)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.

13. I refuse to register application 1302789.

    Costs

14. Having been successful the Opponents are entitled to their costs which I award against the Applicant.

    Iain Thompson
    Hearing Officer
    Trade Marks Hearings
    6 June 2013