McD Asia Pacific LLC v Swancom Pty Ltd

[2017] ATMO 149

TRADE MARKS ACT 1995

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

Re:Opposition by McD Asia Pacific LLC to registration of trade mark application 1669900 (41, 43) – THE CORNER - in the name of Swancom Pty Ltd

Delegate:	Nicholas Smith
Representation:	Opponent: Khajaque Kortian of Spruson & Ferguson Applicant: Susan Gatford of Counsel instructed by Clayton Utz
Decision:	2017 ATMO 149 Trade Marks Act 1995 (Cth) - Section 52 opposition: s 41 considered – ground not established – trade mark to proceed to registration

Background

1. This is an opposition brought by McD Asia Pacific LLC (‘Opponent’) pursuant to s 52 of the Trade Marks Act 1995 (Cth) (‘Act’) to the registration of the trade mark subject of the application detailed below in the name of Swancom Pty Ltd (‘Applicant’): 

Application Number:	1669900
Filing Date:	20 January 2015
Services:	Class 41: Organising, conducting, providing and providing information in relation to entertainment, recreation, sporting and cultural activities, including live music performances; amusement services; entertainment services; providing facilities for entertainment, recreation, sporting and cultural activities, including live music performances; ticket booking and reservation services for entertainment, recreation, sporting and cultural activities; publication services relating to these services; provision of all such services over a global computer network Class 43: Provision of food and drink; cocktail lounge, bar, cafe, snack bar and restaurant services; catering services; hospitality services  (collectively ‘Applicant’s Services’)
Trade Mark:	THE CORNER       (‘Trade Mark’)

2. Following the advertisement on 25 June 2015 in the Australian Official Journal of Trade Marks of the application’s acceptance for possible registration, the Opponent filed a Notice of Intention to Oppose on 25 August 2015 and a Statement of Grounds and Particulars (‘SGP’) on 25 September 2015. The SGP was assessed by this office as adequate. The Applicant filed a Notice of Intention to Defend on 19 November 2015. The SGP raised a single ground of opposition under s 41 of the Act.

Evidence

3. The Opponent filed Evidence in Support of its opposition (‘EIS’) on 23 May 2016.  This evidence consists of a declaration made on 23 May 2016 by Khajaque Kortian, Principal of Spruson & Ferguson, trade mark attorneys for the Opponent, with Exhibits KK-1 to KK-4 (‘Kortian 1’).

4. The Opponent filed Evidence in Answer (‘EIA’) on 21 September 2016.  This evidence consists of a declaration made on 20 September 2016 by Matthew Everett, a director of the Applicant, with Exhibits ME-1 to ME-16, with ME-11, 13 and 14 being marked as confidential (‘Everett Declaration’).

5. The Opponent filed Evidence in Reply (‘EIR’) on 28 November 2016.  This evidence consists of a declaration made on 28 November 2016 by Khajaque Kortian with Annexure KK-1 (‘Kortian 2’). 

6. Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing or to file written submissions.  On 31 March 2017 the Opponent requested an oral hearing. The matter was set down for a hearing in Canberra on 4 October 2017 and was allocated to me.  In line with usual practice, an email was sent to the parties on 23 August 2017 which contained a schedule for the provision of written summaries of submissions to be filed prior to the hearing.  The Opponent filed written submissions on 20 September 2017 (‘Opponent’s Submissions’) and the Applicant filed written submissions on 27 September 2017 (‘Applicant’s Submissions’).  At the hearing Khajaque Kortian of Spruson & Ferguson represented the Opponent and Susan Gatford of Counsel represented the Applicant.  Mr Kortian appeared by telephone and Ms Gatford appeared in person. 

7. I am a delegate of the Registrar of Trade Marks and I am to decide the opposition as required by s 55 of the Act which provides that, unless the proceedings are discontinued, dismissed, or have lapsed under s 54A the Registrar must, at the end, decide on the basis of the written record, comprised of the materials mentioned in the preceding paragraphs, and the oral submissions given at hearing:

(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.

The Opponent

8. The Opponent does not provide any evidence about itself in this matter.       

9. Kortian 1 contains a series of exhibits being:

·    A print out of trade mark registrations in Australia for marks that include the word ‘corner’;

·    A print out of the Australian Yellow Pages telephone directory for businesses listed in the directory with the word ‘corner’ in their name;

·    A print out of certain pages from the Applicant’s 15-year anniversary e-publication; and

·    Print outs from the current home page of the Applicant’s website situated at type="1">

Kortian 2 exhibits a selection of print outs of the results of searches on the Australian Securities & Investments Commission website with respect to business names that contain the word ‘corner’.

The Applicant

1. The Applicant is the operator of a pub/hotel known as The Corner Hotel that trades on Swan Street, in Richmond, Melbourne.

2. The Everett Declaration contains the following claims/statements:

   ·    The Applicant is the owner of a number of related trade marks that contain the word corner in respect of services in class 41 and 43.  They are CORNER HOTEL (no. 1388154), CORNER (no. 1442211) and CORNER PRESENTS (no. 1623364.).

   ·    The Corner Hotel is located about 1.5km from the Melbourne CBD and very close to both public transport and the Melbourne Cricket Ground, Melbourne Park Tennis complex and AAMI stadium.  It receives significant traffic before or after a sporting event and on the way home from the CBD.  The facilities of The Corner Hotel include a band room, a rooftop beer garden and a front bar with a total capacity of 950 people.  

   ·    The Applicant has operated The Corner Hotel since 1995 but the premises have been operated as a pub/hotel by the Applicant’s predecessors under and by reference to the trade mark CORNER HOTEL.  The Corner Hotel has a long history as a live music venue, with acts that have performed including Mick Jagger, Dave Gilmour, TISM, Mental as Anything and Baby Animals.  Performances by musicians and bands are advertised by the promotors in a number of ways, including by displaying tour posters in cities with the name of the venue.

   ·    The ABC radio network JJJ periodically broadcasts shows from The Corner Hotel, generally referring to the venue as The Corner Hotel or The Corner.  A number of live acts have recorded and released live performances from The Corner Hotel.  The White Stripes created the riff for their song ‘Seven Nation Army’ during a sound check at the Corner Hotel.

   ·    As a result of the popularity of The Corner Hotel and its reputation as an iconic live music venue in Melbourne, The Corner Hotel has a substantial reputation and is well-known in Australia and internationally.  It has been the subject of frequent profile pieces, including in The Australian, Qantas and Jetstar Magazines, Rolling Stone, the Sydney Morning Herald and The Age.

   ·    The primary brand the Applicant has traded under has been CORNER HOTEL however at some point (probably more than 10 years prior to the date of the declaration), the Applicant started to increasingly use CORNER and THE CORNER to identify itself.  There are examples of the Corner Hotel referring to itself as ‘The Corner’ as early as 2001, however the Deponent estimates that in the last 10 years less than 50% of its brand use has been the CORNER HOTEL, with the majority being CORNER or THE CORNER.

   ·    In addition to providing entertainment services, the Applicant provides a range of food and beverage services at The Corner Hotel.  It has also sold merchandise online and at The Corner Hotel, some of which features The Trade Mark.

   ·    The Applicant has promoted The Corner Hotel, including under THE CORNER Mark using a variety of methods, including from a website at since 2001, through Melbourne media, both newspapers and ‘street magazines’, through local radio stations and through tour posters.  The Applicant has a subscriber e-mail list of 70,000 people who receive information on events held at The Corner Hotel and maintains Facebook and Instagram pages.  The Applicant’s expenditure on the promotion of The Corner Hotel is substantial and much of this promotion involves the use of the Trade Mark.

   ·    While there are other businesses that use the words ‘the corner’ none have any significant online presence or reputation.

Grounds of Opposition, Onus and Standard of Proof

1. As indicated above the SGP nominates the ground of opposition under s 41. To successfully oppose the application the Opponent bears the onus of proof. ^[1] 

   [1] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58, [32].

2. The relevant standard of proof is the ordinary civil standard based on the balance of probabilities.[2]  The date at which the rights of the parties are to be determined is 20 January 2015, being the filing date of the application in Australia (‘relevant date’).

Discussion

[2] Following Pfizer Products Inc v Karam (2006) 70 IPR 599, [6]-[26], and Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133].

Section 41

1. Section 41 of the Act is set out below:

41 – Trade Mark not distinguishing applicant’s goods or services

(1)An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (the designated goods or services) from the goods or services of other persons.

Note:      For goods of a person and services of a person see section 6.

(2)A trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons only if either subsection (3) or (4) applies to the trade mark.

(3)This subsection applies to a trade mark if:

(a)the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons; and

(b)the applicant has not used the trade mark before the filing date in respect of the application to such an extent that the trade mark does in fact distinguish the designated goods or services as being those of the applicant.

(4)This subsection applies to a trade mark if:

(a)the trade mark is, to some extent, but not sufficiently, inherently adapted to distinguish the designated goods or services from the goods or services of other persons; and

(b)the trade mark does not and will not distinguish the designated goods or services as being those of the applicant having regard to the combined effect of the following:

(i)the extent to which the trade mark is inherently adapted to distinguish the goods or services from the goods or services of other persons;

(ii)the use, or intended use, of the trade mark by the applicant;

(iii)any other circumstances.

Note 1:Trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate:

(a)the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; or

(b)the time of production of goods or of the rendering of services.

Note 2: For goods of a person and services of a person see section 6.

Note 3: Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (5) and 7(3) and section 8).

(5)For the purposes of this section, the use of a trade mark by a predecessor in title of an applicant for the registration of the trade mark is taken to be a use of the trade mark by the applicant.

Note 1: For applicant and predecessor in title see section 6.
Note 2: If a predecessor in title had authorised another person to use the trade mark, any authorised use of the trade mark by the other person is taken to be a use of the trade mark by the

1. With respect to s 41 it is appropriate to discuss the ‘presumption of registrability’. As was explained by the Hearing Officer in Unilever plc v Beiersdorf AG:

   Section 33 of the Act states that the Registrar must accept an application unless satisfied that it has not been made in accordance with the Act, (which is not relevant here), or that there are grounds under the Act for rejecting it. In this regard s 33 embodies what is often referred to as a ‘presumption of registrability.’ As was explained in Blount Inc v Registrar of Trade Marks[3] (‘Oregon’), however, prior to the [Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (“the Amending Act”)] ss 41(5) and (6) as they then were, (which essentially correspond to current ss 41(4) and (3) respectively), effectively shifted the onus onto an applicant. Section 41 was thus amended to address that inconsistency, with the Explanatory Memorandum to the Intellectual Property Laws Amendment (Raising the Bar) Bill 2011 (‘the EM’) stating at page 146:

   [3] (1998) 40 IPR 498, 505.

   The changes are intended to clarify that the presumption of registrability, as provided for in section 33, does apply to section 41. … The intention is that, if the Registrar is equally unsure of whether the mark is or is not capable of distinguishing, that doubt should be resolved in the applicant’s favour.

   The Amending Act was not however intended to alter the relevant standard for registrability. In this regard the EM goes on to state (also at page 146):

   Note that while the amendment [to s 41] ensures that the onus rests with the Registrar during examination, it is not intended to require that the trade mark should clearly not be registered. Rather, as with other grounds it is intended that the delegate need only be satisfied that a ground exists on the balance of probabilities.

   The amendments are not meant to alter the key concepts of “inherently adapted to distinguish”, “capable of distinguishing” and “does or will distinguish”.  The judicial tests for these terms are settled and the amendments are not intended to change the legal concept of a trade mark distinguishing the applicant’s goods or services from others.

   Branson J’s analysis at 504 in Oregon of the operation of s 41 as it stood prior to the Amending Act, as paraphrased below, also remains apt in relation to the amended section:

   Having taken [the extent of inherent adaptation] into account, it is theoretically open to [me] to conclude:

   (a) that the [Trade Mark] is inherently adapted to distinguish the [Applicant’s Services] from the goods or services of other persons and capable, on that basis alone, of so distinguishing the [Applicant’s Services]; [that is, neither s 41(3) nor s 41(4) applies] or

   (b) that the [Trade Mark] is not to any extent inherently adapted to distinguish the [Applicant’s Services] from the goods or services of other persons; [that is, s 41(3) applies] or

   (c) that the [Trade Mark] is to some extent inherently adapted to distinguish the [Claimed Goods] from the goods or services of other persons, but there is uncertainty, on that basis alone, that the trade mark is actually capable of so distinguishing the [Applicant’s Services]. [that is, s 41(4) applies][4]

   [4] [2017] ATMO 25, [38]-[40].

2. I note for completeness that the presumption of registrability also applies at the opposition stage and in an appeal under s56 of the Act[5].

   [5] Sports Warehouse, Inc v Fry Consulting Pty Ltd (2010) 87 IPR 300, [27], quoting Pfizer Products Inc v Karam (2006) 70 IPR 59, 602.

3. Paraphrasing what the same Hearing Officer said in Pacific Magazines Pty Ltd v Bauer Consumer Media Ltd[6]:

   As mentioned in paragraph [13] above the Opponent bears the onus of establishing its s 41 ground of opposition. However, its onus is effectively limited to satisfying me that the [Trade] Mark is not sufficiently adapted to distinguish the Applicant’s Goods and Services as to qualify for registration on that basis alone, being the issue addressed in particular by s 41(3) [as it stood prior to the Amending Act.][7] 

   [6] [2015] ATMO 69 at [16]. I have in the main also retained the Hearing Officer’s original footnotes.

   [7] See Sports Warehouse, Inc v Fry Consulting Pty Ltd (2010) 87 IPR 300, [26]-[29], [40] for a full discussion on this point.

4. The test for inherent adaptation to distinguish is set out in Clark Equipment Co v Registrar of Trade Marks:

   That ultimate question must not be misunderstood. It is not whether the mark will be adapted to distinguish the registered owner's goods if it be registered and other persons consequently find themselves precluded from using it. The question is whether the mark, considered quite apart from the effects of registration, is such that by its use the applicant is likely to attain his object of thereby distinguishing his goods from the goods of others. In Registrar of Trade Marks v. W. & G. Du Cros Ltd. (1913) AC 624, at pp 634, 635 Lord Parker of Waddington, having remarked upon the difficulty of finding the right criterion by which to determine whether a proposed mark is or is not "adapted to distinguish" the applicant's goods, defined the crucial question practically as I have stated it, and added two sentences which have often been quoted but to which it is well to return for an understanding of the problem in a case such as the present. 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. [8]

   [8] (1964) 111 CLR 511, [5].

1. The High Court in Cantarella Bros Pty Limited v Modena Trading Pty Limited[9] (‘Cantarella’) considered that the process of determining whether a mark was inherently adapted to distinguish involved a two-step process.  They stated:

   It is the “ordinary signification” of the word, in Australia, to persons who will purchase, consume or trade in the goods which permits a conclusion to be drawn as to whether the word contains a “direct reference” to the relevant goods (prima facie not registrable) or makes a “covert and skilful allusion” to the relevant goods (prima facie registrable).  When the “other traders” test from Du Cros is applied to a word (other than a geographical name or a surname), the test refers to the legitimate desire of other traders to use a word which is directly descriptive in respect of the same or similar goods.  The test does not encompass the desire of other traders to use words which in relation to the goods are allusive or metaphorical. In relation to a word mark, English or foreign, “inherent adaption to distinguish” requires examination of the word itself, in the context of its proposed application to particular goods in Australia.[10]

   [9] (2014) 254 CLR 337.

   [10] Ibid., [50].

1. Accordingly, the first step is to determine the ordinary signification of the words comprising the Trade Mark, in respect of the Applicant’s Services.  The High Court in Cantarella continued (emphasis added):

   As shown by the authorities in this court, the consideration of the “ordinary signification” of any word or words (English or foreign) which constitute a trade mark is crucial, whether (as here) a trade mark consisting of such a word or words is alleged not to be registrable because it is not an invented word and it has “direct” reference to the character and quality of goods, or because it is a laudatory epithet or a geographical name, or because it is a surname, or because it has lost its distinctiveness, or because it never had the requisite distinctiveness to start with.  Once the “ordinary signification” of a word, English or foreign, is established an inquiry can then be made into whether other traders might legitimately need to use the word in respect of their goods.  If a foreign word contains an allusive reference to the relevant goods it is prima facie qualified for the grant of a monopoly.  However, if the foreign word is understood by the target audience as having a directly descriptive meaning in relation to the relevant goods, then prima facie the proprietor is not entitled to a monopoly of it.  Speaking generally, words which are prima facie entitled to a monopoly secured by registration are inherently adapted to distinguish [11]

   [11] Ibid., [71].

1. The ground based on s 41 of the Act is particularised in the SGP as follows:

   The Trade Mark the subject of the above application is not capable of distinguishing the Applicant’s services the subject of that application from those of other traders. The words “THE CORNER” are descriptive in relation to the services for which registration is sought and common to the trade, including numerous third party registrations covering the same or similar services on the Register incorporating the word “CORNER”.

1. As noted above, the onus is on the Opponent to establish that the Trade Mark is not sufficiently adapted to distinguish the Applicant’s Services so as to qualify for registration on that basis alone.  The Opponent’s submissions (both written and oral) focus on the fact that the words ‘the corner’ are common to the trade (at least in relation to restaurant and food services).  Given that the Trade Mark consists of purely descriptive words, which (according to the Opponent’s Submissions) are commonly used in the trade, the Opponent submits that another trader might, without improper motive, want to use the Trade Mark in relation to similar services or closely related goods to the Applicant’s Services.  

2. The Applicant’s Submissions refer to the footnote to s 41(4) of the Act, which states that trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services[12].  The Applicant then submits that the correct process is to determine the ordinary signification of the Trade Mark and then determine, according to the ordinary signification, whether other traders might desire to use the Trade Mark in respect of the Applicant’s Services.  I consider the Applicant’s approach to be the correct one, being the one set out by the High Court in in Cantarella, referred to in paragraph 21 above.

   [12] Justice Wilcox, in Ocean Spray Cranberries Inc v Registrar of Trade Marks (2000) 47 IPR 579 at 589 stated while the note to s41 “does not have legislative force… it fairly reflects the trend of relevant judicial authority”.

3. With respect to the ordinary signification of the Trade Mark, the Applicant notes that the phrase ‘The Corner’ operates to refer to a particular geometric construct, being a place or angle where two sides or edges meet.  The Applicant then submits, that when considering the ordinary signification of the Trade Mark, the Trade Mark does not refer to the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic of the Applicant’s Services.

4. The Opponent, in its oral submissions, suggested that the ordinary signification of ‘The Corner’ was ‘local’ and referred to the common usage of the term ‘corner store’ as meaning local store in Australia.  While ‘corner store’ may have a meaning similar to ‘local store’, no evidence was proffered on this point.  Even if this had been established, the phrase ‘the corner’ is a noun and there is no evidence (or submissions) before me to suggest that the Trade Mark has ever had an ordinary signification that refers to the geographical origin of the Applicant’s Services; in particular there is no evidence that the ordinary signification of ‘The Corner’ is ‘the local’. 

5. This issues in this case resembles those considered in the case of T.G.I. Friday's Australia Pty Ltd v TGI Friday's Inc[13], in which the Full Court considered the question of whether the Trade Mark T.G.I. FRIDAY'S was capable of distinguishing restaurant and bar services.  The removal applicant (in that case) submitted that ‘TGI Friday’s’ was an ordinary English expression, constantly used in the community, that there is a natural association of the words with relaxation and an drink, and a number of independent uses of the expression in relation to bars and restaurants had been made.  The Full Court’s response was:

   It may be that the expressions "T.G.I. Friday" or "thank God it's Friday" are expressions that are and have been regularly used in relation to relaxation and refreshment…."TGI Friday's" is not descriptive of the character of restaurant services, or any other services for that matter. It does not inherently refer to restaurant services. It does not of itself describe services of any character.

   Accordingly, the Trade Mark has always been capable of distinguishing restaurant services provided by one proprietor from the services of another proprietor who does not use the Trade Mark.[14]

   [13] [2000] FCA 720.

   [14] Ibid, [62]-[63].

1. I consider that the Trade Mark does not refer to the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic of the Applicant’s Services.  It is not a laudatory epithet or a geographical name.  While a small number of other traders operating restaurant and related services have used the phrase ‘the Corner’ as part of their business names, when considering the ordinary signification of the Trade Mark it cannot be said that other traders might legitimately need to use the phrase in respect of their goods/services; the Trade Mark is simply not descriptive in any way of the Applicant’s Services; it is allusory at best. 

2. I find that the Trade Mark is inherently adapted to distinguish the Applicant’s Services from the goods or services of other persons. I find that the Opponent has failed to discharge the onus it bears in establishing the ground of opposition under s 41.

Decision

1. The Opponent has failed to establish the ground of opposition it nominated in the SGP.  Trade Mark application no. 1669900 may proceed to registration not less than one month from the date of this decision.  If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until either the appeal is withdrawn or discontinued.  Otherwise the disposition of the application should be in accordance with the Court’s order or direction.

Costs

1. The Applicant has sought an award of costs in its favour. I see no reason to depart from the general rule that costs follow the event. I accordingly award costs against the Opponent under section 221 of the Act in the relevant amounts under Schedule 8 of the Trade Mark Regulations 1995.

Nicholas Smith
Hearing Officer
Hearings and Oppositions
1 December 2017