Marci Polo Foods Pty Ltd v Benino Fine Foods (Aust) Pty Ltd

[2005] ATMO 32

TRADE MARKS ACT 1995

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

Re:Application 928996(30) to register a trade mark by Benino Fine Foods (Aust) Pty Ltd and opposition thereto by Marco Polo Foods Pty Ltd.

Delegate:	Ian Thompson
Representation:	Applicant.  Khajaque Kortian of Spruson & Ferguson
Opponent:  John de Meyrick instructed by Handcock Alldis & Roskov
Decision:	1. s52 proceedings – s58, s42 (Trade Practices Act 1974 s52) – opposition established.

Background

1. Benino Fine Foods (Aust) Pty Ltd (‘the applicant’) of Illawong, New South Wales, has filed application to register a trade mark, current details of which are:

   App No:  928996

   Filing Date:  30 September 2002

   Goods:  Class: 30 Packaged foods

   Trade Mark:  MARKO

2. Following acceptance of the trade mark for possible registration, Marko Polo Foods Pty Ltd of Campsie, New South Wales opposed registration of the trade mark.  The parties have served and filed evidence in relation to the opposition in accordance with the Trade Marks Act 1995 (‘the Act’) and regulations thereto. 

3. As a delegate of the Registrar of Trade Marks, I heard the parties at a hearing in Sydney on 14 March 2005, Khajaque Kortian of Spruson & Ferguson represented the applicant; John de Meyrick instructed by Handcock Alldis & Roskov represented the applicant.

4. The submissions of the opponent focussed on sections 58, 44(1), 60 and 42 of the Act.

   Evidence

5. The evidence comprises statutory declarations from the following people:

Declarant	Position Known as	Date Made	Exhibits
Evidence in Support
Krste Georgievski	Managing Director of Opponent Georgievski	3 September 2003	KG-1 to KG-6
Evidence in Answer
Krste Trajceski	Managing Director of Applicant Trajceski	15 December 2003	CT-1 to CT-5
Evidence in Reply
Jenaya Raposo	16 August 2004
Maree Fotiou	11 August 2004
Helen Kagias	10 September 2004

1. Since 1983, the opponent has sold pickled vegetables, under the trade marks shown below, to retailers.  These goods are then sold to consumers through most major supermarket chains in Australia, delicatessens, vegetable retailers and specialty shops.  The wholesale sales value of these goods is well in excess of a million dollars annually.  It would be reasonable to expect the retail value to be substantially more.

2. The above trade marks are also registered by the opponent in Australia in Class 30 in respect of, inter alia, the goods of interest to the parties under registrations 721160 and 536027 respectively. 

3. The opponent’s evidence includes statutory declarations by three people who state that they erroneously bought the opponent’s goods because of the (alleged) similarity of the trade marks.

4. The evidence shows that the applicant also imports pickled vegetables, from the Polish company ZPOiW MARKO (‘the Polish Company’) under an agreement dated 1 August 2002.  Under a further agreement with the Polish Company, the applicant is permitted to register the ‘name’ MARKO in Australia.  I note now that the agreements do not specify that the applicant may register the trade mark MARKO – neither does it specify in whose name the ‘name’ MARKO may be registered.  The Polish Company has registered the trade mark MARKO in Poland.

5. Prior to the agreement with the applicant, and since 1997, goods bearing the trade mark MARKO were imported into Australia by a number of other traders.

6. The applicant has imported goods bearing the trade mark MARKO from Poland since September 2002.  It is difficult to ascertain the extent of the use of the trade mark in Australia since the answer is buried within the general statement in paragraphs 2 and 3 of the Trajceski declaration, “In 2002 my Company commenced importing food products, manufactured in Poland, Macedonia and China, and has acquired a significant and valuable reputation in Australia as a result of extensive trading and promotional activities.  My company imports food products and distributes the imported products together with local products to approximately 500 retail outlets”.  As the applicant imports goods under six different trade marks which are all included in the claim, the statement is especially vague and of very low probative weight.  I also note that this statement makes no claim for the use or reputation of the trade mark MARKO, per se, in Australia but only for the applicant.

7. At the hearing, the applicant sought to put into evidence a jar bearing the trade mark of the applicant in use.  In use, the applicant’s trade mark is not the same as that shown on the application – if anything, the applicant’s trade mark in use is illustrative of the test in Re Smith Hayden and Co's Application (1946) 63 RPC 97 at 101.8:

   "Assuming a use by the proprietor of each of the cited trade marks in a normal and fair manner in respect of any of the goods and services covered by those registrations, is the court satisfied that there will be no reasonable likelihood of deception and confusion amongst a substantial number of persons if the applicant for registration (the respondent to this application) also uses its mark normally and fairly in respect of services covered by the proposed registration."

8. In other words, in use the applicant’s trade mark (which has been filed in the form of a typed word) might appear in a number of different get-ups, fonts and type faces – I must consider these potential uses of the trade mark that the applicant might make, within the scope of its application - some of which might bear a greater resemblance to the trade marks of the opponent.

9. I declined to accept this evidence as it is not relevant to the proceedings and is material which the applicant could have readily discovered and served on the opponent previously.

   Discussion

10. I will discuss only those grounds under which I consider that the opponent has established its opposition to my satisfaction.

    Section 58

11. Section 58 provides:

    Applicant not owner of trade mark

    58. The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.

    Note:  For applicant see section 6.

12. In order to establish its opposition under section 58 in the context of this opposition, the opponent must demonstrate the prior use in Australia of a trade mark which is at least substantially identical[1] to the opposed trade mark by a person other than the applicant on goods which are ‘the same kind of thing’[2].

    [1] Carnival Cruise Lines Inc. v. Sitmar Cruises Limited 31 IPR 375

    [2] re Hicks' Case (1897) 22 VLR 636, by Holroyd J

13. The first user of a trade mark in Australia thus becomes the owner of the mark at common law, and may become the owner of the registered trade mark: Shell Co. of Australia Ltd. v. Rohm and Haas Co (1949) 78 CLR 601 at 627.

14. Put briefly, the opponent argues that the owner of the opposed trade mark in Australia is the Polish Company.  The Polish Company, argues Mr Kortian, has had first use of the opposed trade mark via the distributors who imported its goods prior to the exclusivity agreement with the applicant.  If I understand Mr Kortian correctly, he argues that the agreement in the applicant’s evidence is irrelevant to these proceedings, ‘whether or not the Polish company has “authorised” the registration of the trade mark’.

15. I would not go as far as the extreme argued by Mr Khortian – it is probable, I consider, that an agreement drafted in suitable terms might well transfer common law rights in a trade mark and permit the registration of the trade mark by a person other than the first user of the trade mark in Australia.  However, the documents that are claimed to support the applicant’s contention that such right has been transferred to it are too vague for me to find that such is the case here.  The agreement does not mention a ‘trade mark’; it rather mentions a ‘name’.  Further, the agreement does not stipulate in whose name the trade mark is to be registered in Australia and is made with an individual other than the applicant..

16. Mr de Meyrick also argued that oppositions under section 58 only succeed when argued by the true owner of the opposed trade mark.

17. However, there is no requirement within section 52 (or section 58) of the Trade Marks Act 1995 that an opponent has a locus which, in my view of Mr de Meyrick’s submission, amounts to being ‘a person aggrieved’, such as there is under section 92 of the Act. The requirement would require a prejudicial assessment by the Registrar or Court that the opponent is the owner before the substantial matter of section 58 is considered. And oppositions where the owner is not the opponent have, in the past, succeeded before the Courts and Registrar– see for example Malibu West, Inc v Catanese [2000] FCA 1141; Agricultural and Processed Food Products Export Development v Muhammad Munsha [2004] ATMO 69. Mr de Meyrick did not cite any authority that suggests that this approach is wrong.

18. The precedents show that even slight use of a trade mark by a person other than the applicant (or a licensed user) before the filing date is sufficient to establish ownership: Blackadder v. Good Roads Machinery Co. Incorporated (1926) 38 CLR 332; Thunderbird Products Corporation v. Thunderbird Marine Products Pty. Ltd. (1974) 131 CLR 592.

19. Here, the applicant has attested to, and documented, use by the Polish Company of the identical trade mark in terms of Re Smith Hayden and Co's Application (1946) 63 RPC 97 at 101.8, on the identical goods, before the filing date of this opposed application. The agreement that the applicant has exhibited to its evidence is too vague to be taken to be a transfer of the Polish Company’s common law rights in the trade mark.

20. Put another way: if the Polish Company were pursuing this opposition, it must succeed under section 58 on the facts before me. As there is no requirement in the Act that the opponent must be a person aggrieved in section 58, the opposition must also succeed if another person pursues it on the same basis and facts.

21. I am satisfied that the opponent has established its opposition under section 58.

    Section 42

22. Section 42 of the Act provides:

    Trade mark scandalous or its use contrary to law

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

    (a) the trade mark contains or consists of scandalous matter; or
    (b) its use would be contrary to law.

23. Here the opponent pursues its opposition under section 52 of the Trade Practices Act 1974 which provides:

    52  Misleading or deceptive conduct

    (1)A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

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

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

24. Following the decision of Madgwick J in Advantage Rent-a-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683, the Registrar is obliged, when assessing whether use would be contrary to law under section 42(b), to take into account the operation of laws and legislation other than the Trade Marks Act 1995. Here, the opponent alleges that use of the trade mark would contravene section 52 of the Trade Practices Act 1975 on the basis that use would mislead or deceive consumers into thinking that the applicant’s goods were in some way connected with the opponent.

25. In the Advantage Rent-A-Car case, Madgwick J confirmed that the test to be satisfied was that use would, rather than could, be contrary to law.  Therefore, I am to determine, on the balance of probabilities, and on the basis of a hypothetical case which takes into account all the evidence and submissions before me, whether use of the applied-for trade mark on the goods of interest would cause, or be likely to cause, consumers to be misled or deceived.  The relevant standard to be applied is that there must be a "real or not remote chance or possibility" of a reasonably significant number of people being misled or deceived: see, for instance, Equity Access Pty Limited v Westpac Banking Corporation (1989) 16 IPR 431 where the following principles were stated:

    1.  For conduct to be misleading or deceptive the conduct must convey in all the circumstances of the case a misrepresentation: 

    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:

    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%.  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.

    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: 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: 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."

    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.  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.

    6.  Section 52 is not confined to conduct which is intended to mislead or deceive and a corporation which acts honestly and reasonably may none the less engage in conduct that is likely to mislead or deceive.

26. Although the opponent in its evidence suggests otherwise, I accept that the applicant has adopted its trade mark innocently.  The opposed trade mark was in existence and used in Australia before the principal of the applicant company terminated his association with the opponent company.

27. The opponent’s trade marks are likely to be known as the MARCO POLO trade marks.  The words are the most prominent feature of the opponent’s trade marks and always appear in the opponent’s trade marks.  The words are immediately identifiable and memorable because of their association with the eponymous Italian explorer who introduced new foods into Italy.  To paraphrase subparagraph 5, above, on the evidence before me, the opponent has established that it has acquired the relevant reputation in the name, that is to say that the name has become distinctive of the applicant's business to the extent that most people who regularly buy pickled vegetables must be aware of the trade mark.

28. While Mr de Meyrick argued that the better known a trade mark, the less it was likely to be confused for another trade mark, this view does not sit well with the requirement under section 52 of the Trade Practices Act 1974 that the applicant must establish that it has acquired the relevant reputation in the trade mark, mentioned at subparagraph 5, above.  In fact, this argument may be better viewed as a concession that the opponent’s trade mark is well known.

29. As well as being sold through supermarkets, the opponent’s goods are sold through delicatessens and fruit and vegetable shops where the goods are likely to be sold by a verbal request.

30. The word MARKO is identical phonetically to the word MARCO and in the context of the trade marks will be the first word heard or seen when purchasing the goods, whether the purchase is in the supermarket or delicatessen or vegetable shop. 

31. The goods are of low value – so consumers do not exercise the same caution when purchasing them as they do when buying more expensive goods.  And conditions in shopping, such as those identified in the ‘apothecaries jars’ case, apply to the purchases: Re: Stuart Alexander And Co. (Interstate) Pty. Limited and Douwe Egberts Koninklijke Tabaksfabriek-Koffiebranderijen-Theehandel N.V. and Blenders Pty. Limited (1981) 53 FLR 307.

32. Under such circumstances, a high percentage of substitute purchases are, I consider, inevitable.

33. I am thus satisfied that use of the opposed trade mark would mislead or deceive.  While I do not rely on them heavily and prefer to rely on my own assessment, I note that the opponent has supported its contentions with declarations from several people who state that they had intended to purchase goods sold under the opponent’s trade mark and have subsequently discovered that they have bought goods sold under the applicant’s trade mark.  They have thus been deceived or misled about the origins, maker and quality of the goods. 

34. I am satisfied that the opponent has established its grounds under section 42 of the Act

    Decision

35. Section 55 of the Act provides:

    Decision

    55. 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.

36. I refuse to register application 928996.

    Costs

37. As the opponent has been successful in these proceedings, I order costs against the applicant.

    Ian Thompson

    Hearing Officer

    Trade Marks Hearings

    27 June 2005