Milir Enterprises Pty Ltd as Trustee for the Lynch Family Trust v Scarab Water (Pty) Ltd & Stephen Nicol

TRADE MARKS ACT 1995

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

Re:Opposition by Milir Enterprises Pty Ltd as trustee for The Lynch Family Trust to application under section 92 of the Act by Scarab Water (Pty) Ltd & Stephen Nicol to remove trade mark number 1622569 (40,42) - Scarab Waste Water Australia and device - in the name of Milir Enterprises Pty Ltd as trustee for The Lynch Family Trust

Delegate:

Aaron Walters

Representation:

Opponent: No submissions

Applicant: No submissions

Decision:

2018 ATMO 65

Opposition under section 96 of the Trade Marks Act 1995 to an application for removal under section 92 – ground under section 92(4)(a) – allegation of lack of intention to use successfully rebutted – Trade Mark to remain on Register.

Background

This is a matter concerning an application made on 12 December 2016 for removal of a trade mark from the Register under s 92(4)(a) of the Trade Marks Act 1995 (‘the Act’) and the subsequent opposition to that removal under section 96 of the Act. The details of the trade mark registration subject of the application for removal (‘the removal application’) are:

Trade Mark No: 1622569

Trade Mark:

(‘the Trade Mark’)

Owner: Milir Enterprises Pty Ltd as trustee for The Lynch Family Trust

Filing Date: 14 May 2014

Specification of Services: (‘the registered services’)

Class 40
Waste treatment (transformation); sewerage and waste water treatment services; effluent; treatment (waste treatment); industrial treatment of effluents; chemical treatment of waste products; processing of waste materials; operation of sewerage and waste water treatment; systems; waste destruction; waste management information; waste management services; waste processing; waste recycling services

Class 42
Design of sewerage and waste water treatment systems and facilities; on-site testing and development services provided via mobile pilot plants for sewerage and waste water

The removal application was made by Scarab Water (Pty) Ltd & Stephen Nicol (‘the Removal Applicants’). Milir Enterprises Pty Ltd (‘the Removal Opponent’) opposed that application, per s 96 of the Act, by filing a Notice of Intention to Oppose and a Statement of Grounds and Particulars (‘SGP’).
The Removal Applicants filed a Notice of Intention to Defend and the evidence stages commenced with both parties filing evidence in accordance with the Trade Mark Regulations 1995 (‘the Regulations’). The evidence before me consists of:

Evidence in Support

Declaration of Lirelda Lynch, Director of the Removal Opponent, made 29 March 2017 and attaching annexures 1A to 1J, 2A to 2E and 3A to 3Di-v (‘Lynch 1’).

Evidence in Answer

Declaration of Stephen Nicol, CEO of the Removal Applicants, made on 22 May 2017 and attaching SWWA1 to SWWA13, B1, C1 to C2, D1 to D5, E1 to E2, F, G1 to G2, H1 and J1 to J19 (‘the Nicol Declaration’).

Evidence in Reply

Declaration of Lirelda Lynch, Director of the Removal Opponent, made 17 November 2017 (‘Lynch 2’). As it will become necessary, I will refer to the Lynch 1 and Lynch 2 collectively as ‘the Lynch Declarations’.

Lynch 2 includes four pages described as Page 2, Page 3 and Page 4. Page 2 and Page 3 of Lynch 2 incorporates and comments on the Nicol declaration. Page 4 of Lynch 2 includes an addendum which I will address under Preliminary Matters below.

No request to be heard was made by either party and, by way of a letter sent on 4 January 2018, they were given the further opportunity to provide written submissions for the Registrar to consider. However, neither party chose to provide submissions for my consideration, opting to rely upon the evidence referred to above.

Preliminary Matters

In Lynch 2, Mrs. Lynch asserts:
The Statutory Declaration by Nicol has no Legal Binding (sic) in Australia, this was signed in South Africa and is therefore inadmissible and not recognised under Australian Law.[1]
[1] Lynch 2, Page 4.
I am not aware of any authority which supports Mrs. Lynch’s assertion, nor has any such authority been provided for my consideration. I note the declaration signed by Mr. Nicol is written using the standard declaration template made available by IP Australia. Relevantly, this template states the declaration is one “[u]nder the Trade Marks Act 1995 and Regulation 21.6 of the Trade Marks Regulations 1995.”
Regulation 21.6(1) of the Regulations provides:
(1) A declaration required or permitted by the Act or these Regulations must be in an approved form.
Note: Declaration forms in the approved form are available on the IP Australia website at
Consequently, as the Nicol Declaration has been made in the approved form, I see no reason why I should exclude it from my consideration.
In determining the preliminary matter, I think it pertinent to proceed by setting out the legislative framework relevant to the current removal application proceedings.

Legislative Framework

Section 92 of the Act relevantly provides:
92 Application for removal of trade mark from Register etc.
(4) An application under subsection (1) or (3) (non-use application) may be made on either or both of the following grounds, and on no other grounds:
(a) that, on the day on which the application for the registration of the trade mark was filed, the applicant for registration had no intention in good faith:
(i) to use the trade mark in Australia; or
(ii) to authorise the use of the trade mark in Australia; or
(iii) to assign the trade mark to a body corporate for use by the body corporate in Australia;
in relation to the goods and/or services to which the non-use application relates and that the registered owner:
(iv) has not used the trade mark in Australia; or
(v) has not used the trade mark in good faith in Australia;
in relation to those goods and/or services at any time before the period of one month ending on the day on which the non-use application is filed
Section 100 of the Act makes clear the onus to rebut an allegation of non-use made under s 92(4)(a) of the Act lies with the Removal Opponent. The requirements for successful rebuttal pertinent to the current application are set out in ss 100(1)(a)-(b) and 100(2)(a) of the Act, which provide:
100 Burden on opponent to establish use of trade mark etc.
(1) In any proceedings relating to an opposed application, it is for the opponent to rebut:
(a) any allegation made under paragraph 92(4)(a) that, on the day on which the application for the registration of the trade mark was filed, the applicant for registration had no intention in good faith:
(i) to use the trade mark in Australia; or
(ii) to authorise the use of the trade mark in Australia; or
(iii) to assign the trade mark to a body corporate for use by the body corporate in Australia;
in relation to the goods and/or services to which the opposed application relates (relevant goods and/or services); or
(b) any allegation made under paragraph 92(4)(a) that the trade mark has not, at any time before the period of one month ending on the day on which the opposed application was filed, been used, or been used in good faith, by its registered owner in relation to the relevant goods and/or services;
(c) …
(2) For the purposes of paragraph 1(b), the opponent is taken to have rebutted the allegation that the trade mark has not, at any time before the period referred to in that paragraph, been used, or been used in good faith, by its registered owner in relation to the relevant goods and/or services if:
(a) the opponent has established that the trade mark or the trade mark with additions or alterations not substantially affecting its identity, was used in good faith by its registered owner in relation to those goods or services before that period;
For guidance, s 7(5) of the Act provides:
"use of a trade mark in relation to services" means use of the trade mark in physical or other relation to the services.
The definition of a trade mark ‘applied in relation to’ services is defined in s9 of the Act:
9 Definition of applied to and applied in relation to
(1) For the purposes of this Act:
(a) …
(b) a trade mark is taken to be applied in relation to goods or services:
(i) if it is applied to any covering, document, label, reel or thing in or with which the goods are, or are intended to be, dealt with or provided in the course of trade; or
(ii) if it is used in a manner likely to lead persons to believe that it refers to, describes or designates the goods or services; and
(c) a trade mark is taken also to be applied in relation to goods or services if it is used:
(i) on a signboard or in an advertisement (including a televised advertisement); or

(ii) in an invoice, wine list, catalogue, business letter, business paper, price list or other commercial document;

and goods are delivered, or services provided (as the case may be) to a person following a request or order made by referring to the trade mark as so used.

Finally, even if a lack of intention to use the Trade Mark has been established, the Registrar may nevertheless apply a discretion in reasonable circumstances and allow the Trade Mark to remain on the Register. In that regard, s 101 of the Act relevantly provides:
101 Determination of opposed application—general
(1) Subject to subsection (3) and to section 102, if:
(a) the proceedings relating to an opposed application have not been discontinued or dismissed; and
(b) the Registrar is satisfied that the grounds on which the application was made have been established;
the Registrar may decide to remove the trade mark from the Register in respect of any or all of the goods and/or services to which the application relates.
(2) ...
(3) If satisfied that it is reasonable to do so, the Registrar or the court may decide that the trade mark should not be removed from the Register even if the grounds on which the application was made have been established.
(4) Without limiting the matters the Registrar may take into account in deciding under subsection (3) not to remove a trade mark from the Register, the Registrar may take into account whether the trade mark has been used by its registered owner in respect of:
(a) similar goods or closely related services; or
(b) similar services or closely related goods;
to those to which the application relates.
Having set out the relevant legislative framework, I turn now to the evidence submitted by the parties in this matter.

Evidence Summary

Historical and matters of procedure

Having reviewed the evidence, I am aware there exists a complex history, and deterioration, of a business relationship between Mr. Nicol, of the Removal Applicants, and Mr. and Mrs. Lynch, of the Removal Opponent (collectively, ‘the parties’).
The parties’ history derives its complicated nature, through, inter alia, a breakdown in a joint commercial venture, as well as subsequent operation of competing, yet highly similar commercial enterprises, including adopting highly similar corporate identities and branding.
In the interest of fully airing the matter, and with respect to this complicated history, I shall lay out each the evidence of each party. However, though I am aware of a dismissed opposition to the registration of the Trade Mark, procedural fairness dictate I draw conclusions only from the evidence properly filed in the current opposition.

The Removal Opponent’s Evidence in Support

Lynch 1 states the Trade Mark has been used in good faith since April 2014.[2] She asserts that Scarab Waste Water Australia Pty Ltd (‘SWWA’), a company registered on 23 August 2014, is an ongoing concern that is using the Trade Mark on all stationery, advertising and correspondence.[3] Annexures 1A to 1J are led to corroborate these assertions. Relevantly:
[2] Lynch 1, paragraph (C)v.
[3] Lynch 1, paragraph (A).
i.Annexure 1A are SWWA business cards featuring the Trade Mark and list Mike Lynch as a director. No date is provided, or comment made as to when these were acquired by SWWA.
(‘the SWWA business cards’)
ii.Annexure 1B are (what appear to be) branded fridge magnets featuring the Trade Mark. No date is provided, or comment made as to when these were acquired by SWWA.
(‘the SWWA fridge magnets’)
iii.Annexure 1C is a letter, dated 13 June 2016, sent by Mike Lynch as director of SWWA to Southern Downs Regional Council in reference to Lake Leslie Tourist Park. The contents of the letter appear to be an indication of the capability of the installed “Scarab STS 20 system” and a confirmation that SWWA have been monitoring the system “over peak periods”.
(‘the Southern Downs Council letter’)
iv.Annexure 1D features an undated advertisement, within an unspecified supplies catalogue, promoting SWWA waste water services and featuring the Trade Mark. The advertisement celebrates the success of an installation in Cracow Queensland for Evolution Mining and also extols the benefits of a “Scarab System”.
(‘the SWWA advertisement’)
v.Annexure 1E is undated email correspondence sent by Mrs. Lynch, featuring the Trade Mark in the signature. Relevantly, in her correspondence, Mrs. Lynch states “Accumen Accounting is the office holder for: Scarab Australia Pty Ltd (which we are no longer a part of)”. For convenience, I shall hereon refer to Scarab Australia Pty Ltd as ‘Scarab Aus’.
vi.Annexure 1F appears to be a response to the email correspondence seen in Annexure 1E. Notably, this email response indicates Mrs. Lynch’s correspondence was sent 29 July 2014.
vii.Annexure 1G to 1I is an ASIC company extract for SWWA. According to the SWWA company details, Mrs. Lynch is listed as the sole director of SWWA. The Removal Opponent (Milir Enterprises Pty Ltd) is listed as the sole shareholder for SWWA.
(‘the SWWA company details’).
viii.Annexure 1J is a copy of the Trade Mark registration certificate.
Lynch 1 asserts SWWA has an online presence at the domain ‘ Annexure 2A and 2B are led as examples of the current and original website (respectively, ‘the current SWWA website’ and ‘the original SWWA website’), both of which are undated, though prominently feature the Trade Mark.
[4] Lynch 1, paragraph (B)
Lynch 1 also refers to Annexure 2C which is a screenshot of an almost identical website to that of the original SWWA website, though no URL is included. It is alleged by the Removal Opponent that Mr. Nicol created a duplicate website using a similar domain name (‘the similar website’), and that it fraudulently features the Trade Mark, as well as SWWA’s ABN and ACN, for “malicious purposes and phishing.”[5] Annexure 2D and 2E are led as “proof of Nicol owns (sic) fraudulent website.”[6] Annexure 2D features a Whois Domain search result for ‘ which indicates Dung Beatle Enterprises Pty Ltd as the registrant. Annexure 2E features a single unspecified snippet containing company information for Dung Beatle Enterprises Pty Ltd. While this snippet lists Mr. Nicol as a director, no comment is made as to where this entry is extracted from. Consequently, the ‘proof’, such as it is, lacks sufficient detail to substantiate the allegation.
[5] Ibid.
[6] Ibid.
Annexure 3Di-3Dv is led in further support of the Removal Opponent’s assertion as to Mr Nicol’s practice for registering and creating duplicate websites. The annexure features a WIPO Administrative Panel Decision relating to a complaint lodged by Mr Lynch, in his capacity as Managing Director of Milir Waste Enterprises t/a Porta Treat (‘the Porta Treat business’), over Mr. Nicol’s registration of the domain name Of note, the Panel found in favor of Mr. Lynch, holding Mr. Nicol had contravened paragraphs 4(a)(i)-(iii) of the Uniform Domain Name Dispute Resolution Policy, namely that he had registered a confusingly similar domain name “primarily to disrupt the business of a competitor” and for “intentionally using the disputed domain name to attract for commercial gain, Internet users to the Respondent’s [Mr. Nicol’s] website.”[7]
[7] Exhibit 3Dv, page 5 of the WIPO Administrative Panel Decision.
Lynch 1 further notes Mr. Nicol unsuccessfully opposed the Trade Mark application in 2016. More accurately, the opposition was dismissed following deregistration of the opposing company in that matter. Even so, it is alleged Mr. Nicol has refused to remove the similar website which hinders the Removal Opponent’s ability to market their business online.[8] Lynch 1 alleges Mr. Nicol’s actions make it impossible to market the Removal Opponent’s business online as Mr Nicol has “purposely and willfully established confusion to (sic) customers and general public as he did with [the Porta Treat business].” Annexure 3A to 3B are provided to confirm this:
i.Annexure 3A-3B features an email correspondence chain, dated 4 December to 16 December 2016, sent by Mrs. Lynch and alleging trade mark infringement, to the apparent managing director of Scarab International Pty Ltd (‘Scarab Int’). The Managing Director of Scarab Int seen within this correspondence is not Mr. Nicol.
ii.Annexure 3C appears to be a screenshot of a website, different to that of the similar website, which features the Trade Mark. I note again no URL is included. The screenshot provides the ‘Contact Us” information for “Scarab – Australia Wastewater Treatment Plants”. I would note the listed P.O Box matches Mr. Nicol’s listed Australian address for service.
[8] Lynch 1, paragraph (C).
Other than my observation on the similar address for service, no further information is given in Lynch 1 as to what relationship may exist between Mr. Nicol and Scarab Int.

The Removal Applicants’ Evidence

The Nicol Declaration asserts SWWA has never been a trading entity.[9] To corroborate this assertion, I am provided the following reference:
Ref 1) Sworn Affidavit [illegible][10] SA
High Court Case 16211/2015 Pages
Page 161 (26/27/28)
Page 164 (38.3)
[9] The Nicol Declaration, paragraph A).
[10] The Nicol Declaration contains a hand written declaration, some of which is not clearly legible.
The material referred to has not been included as part of the Nicol Declaration filed in support of the non-use application.
In addition, C1 and C2 are led to demonstrate SWWA is not trading.[11] C1 features an email, sent on 1 June 2016, by the director for St Peters Lutheran College to Scarab Int, requesting a service of the “STP that was installed back in 2014.” The email goes on to state “since Mike has moved on we need someone to service it.” I do not consider C1 serves as cogent evidence of SWWA not trading.
[11] The Nicol Declaration, paragraph C).
C2 appears to be promotional material, dated 28 June 2016, for Scarab Int. Relevantly, the promotional material contains the following logo next to the corporate name Scarab (International) Pty Ltd:

(‘the Scarab Int logo’)

The promotional material also features the following statements:

Scarab^TM installed a sewage treatment system at St Peters Lutheran College, Crowsnest – QLD in March 2014. The owners recently requested the plant to be serviced and Scarab Water (Pty) Ltd, was contacted. Within two weeks, a qualified technician from South Africa, was travelling to Queensland, Australia.
…
Scarab^TMclients are placed first and the Australian operation of Scarab (International) Pty Ltd, based in the Brisbane area are now up to speed with the latest developments regarding waste water treatment.

The above appears to indicate Scarab Int is an Australian operational arm of the Removal Applicants. Any inferred affiliation between Mr. Nicol and Scarab Int is confirmed through C3, being a letter sent by Mr. Nicol on behalf of Scarab Int. The letter, dated 10 October 2016 and sent to Lake Leslie Tourist Park, features the Scarab Int logo and contains similar information to that of the Southern Downs Council letter seen in the Removal Opponent’s evidence. The letter does indicate the Scarab wastewater treatment plant was “installed several years ago.” Further, the letter indicates Scarab Int are the “manufacturers and installers of the Scarab system.” No other evidence is led to corroborate Scarab Int as the original installers or manufacturers of the Scarab System.

The Nicol declaration alleges SWWA is not trading as “Lynch has removed all scarab stickers and replaced them with Portatreat.” D1 to D5 are led in support of this allegation and feature a series of photographs of various (presumably) effluent tanks, all of which are primarily non-descript, other than a Porta Treat logo or a Scarab Aus logo on the side. I have reproduced these logos below:

(‘the Porta Treat Logo’) (‘the Scarab Aus Logo’)

Some of these photographs feature date stamps, namely the photographs featuring the Scarab Aus logo, while others are undated, namely the photographs featuring the Porta Treat logo. No comment is provided as to when the undated photographs were captured.
Most photographs also appear with an imposed hand written note providing location details. Aside from this, Mr. Nicol makes no comment, and I am left to infer, that these are photographs taken of the same effluent tanks at different points in time.
Interestingly, one photograph, which appears to be taken at Lake Leslie, Queensland, on 4 October 2013, identifies Mr. Lynch standing next to an effluent tank featuring the Scarab Aus logo.
The Nicol Declaration refers to the SWWA advertisement and states:[12]
E) [SWWA] published advert in resource directory claiming:

1)Another successful project (Evolution Mining) but [Scarab Aus] completed this project.
2)Uses [Scarab Aus] phone no + email address.
3)Claims to have been effective and reliable over the past “13 years” yet [SWWA] was formed in April 2014.
4)Uses photos of [Scarab Aus] which are copyright protected. See attached Doc (E1).
[My emphasis added]
[12] The Nicol Declaration, paragraph E).

No evidence has been provided to confirm Scarab Aus completed this project. Furthermore, in my mind, the emphasized segment of the above statement appears to be a concession by the Removal Applicants to the fact the Removal Opponent published an advertisement featuring the Trade Mark. This is a significant concession for the Removal Applicants to make. Further, I note the Nicol Declaration includes E2, featuring a copy of the SWWA advertisement with a written statement. I have reproduced this as an extract below:

(‘the E2 advertisement extract’)
The Nicol Declaration provides no comment in relation to the E2 advertisement extract. Consequently, given the E2 advertisement extract forms part of the Removal Applicants’ evidence, it is seems plausible that the above written date, being 23 July 2014, is a fair indication of when the SWWA advertisement was published.
It is alleged the Porta Treat business diverted project work from Scarab Aus and “failed to deliver.”[13] I note G1 and G2 provided in support, though these do not substantiate the allegation. No further information is provided to substantiate the claim and I do not consider it further relevant.
[13] The Nicol Declaration, paragraph G).
The Nicol Declaration further claims the current SWWA website “is defamatory and in bad faith.”[14] I am provided SWWA1 to SWWA13, appearing to be a series of undated screenshots of the current SWWA website, in relation to which the Removal Applicants makes a number of assertions. Relevantly, Mr. Nicol asserts the current SWWA website includes information to the public on how to build a “Scarab System”. This is alleged as “not trading practice and Lynch would like to undermine my product and reputation this is anti-trade and therefore anti trade mark rules.”[15]
[14] Ibid, paragraph B).
[15] Ibid, paragraph B4).
Mr. Nicol has provided no further explanation, nor what “trade mark rules” he may be referring to. Although, I note two instances where, in providing instructions on how to construct a “Scarab Waste Water System”, the current SWWA website includes statements to the effect of “This can be done on a nicol and dime budget”, and further, “Don’t be fooled into a Nicol and Dime System, start constructing your own.” Lastly, Mr. Nicol’s full name and photo appear next to a warning statement aimed at consumers.
The Nicol Declaration makes vague reference to “Lynch’s previous business dealing” and provides H1.[16] I have reviewed the content of the emails featured therein, being unsubstantiated and disparaging remarks made in reference to Mr. Lynch, and find it to be of no relevance to the decision I need to make in the current matter.
[16] The Nicol Declaration, paragraph H).
The Nicol Declaration provides a vague reference to “Lynch’s complaint to the South African Military Association. (SAMVOA)” and refers to J1 to J19 (‘the SAMVOA complaint’). The content of which provides some information as to the breakdown of the business relationship between Mr. Nicol and Mr. Lynch while operating a business as Scarab Aus. I note J7 to J11 contains an assertion by Mr. Lynch, followed by a response from Mr. Nicol as to the alleged ownership of the Trade Mark. Again, much of this is unsubstantiated allegation, though I will refer to it as necessary later in my decision.

The Opponent’s Evidence in Reply

Primarily, Lynch 2 refers to the evidence in the Nicol Declaration and considers it to be “irrelevant and inadmissible.”[17]
[17] Lynch 2, Page 2.
In regards to Mrs. Lynch’s assertion of inadmissibility, I have dealt with this earlier under Preliminary Matters. With respect to the assertion of irrelevance, that is a matter for me and a summary of the Removal Applicants’ evidence is seen above. Taking into the abovementioned shortcomings in the evidence from both parties, I turn now to the application of the law to the facts as they have been presented to me.

Reasons

Section 92(4)(a) of the Act provides the means by which to remove a trade mark based on an alleged lack of intention to use it at the time of filing. As is clear from reviewing the evidence, the answer to this question is fiercely contested by the parties. Despite the numerous and unsubstantiated allegations made by both parties as to the conduct of the other, the determinative question turns on what meaning the concept of use of a trade mark has within the Act and in particular s 92(4).[18] It remains necessary for the question to be objectively answered.[19]
[18] Dick Smith Investments Pty Ltd v Ramsey [2016] FCA 939, [97].
[19] E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2010] HCA 15; (2010) 241 CLR 144, [33].
The relevant allegation in this proceeding is that, as at 14 May 2014, the Removal Opponent had no intention in good faith to use, or authorize the use of the Trade Mark, and, at no time prior to 12 November 2016, being one month before the non-use application was filed (‘the relevant period’), did the registered owner use the trade mark in good faith in Australia. To rebut the allegation the Removal Opponent bears the onus of demonstrating the use of the Trade Mark was in good faith or, failing that, demonstrate the requisite intention to use or authorize the use of the Trade Mark in good faith.

Use by, or authorized by, the Removal Opponent

Before delving into matters concerning the use, or intended use, of the Trade Mark, I would first address a notable ambiguity in the Removal Opponent’s evidence.
Consistently throughout the Lynch Declarations, statements are made either in the first person by Mrs. Lynch or in reference to herself as the Trade Mark owner. Further, the majority of the Removal Opponent’s evidence alleging use shows this to be by SWWA. Relevantly, Mrs. Lynch states:
[SWWA]… is an ongoing concern that uses my Registered IP Scarab Trade Mark, No 1622569 on all stationery, advertising and correspondence.[20]
[20] Lynch 1, paragraph (A).
However, Mrs. Lynch follows on to state:
I am using my Trade Mark, therefore do not need to authorise it’s (sic) use.[21]
[21] Lynch 1, paragraph (C)ii.
To rebut the allegation of non-use, the Act requires the owner, (in this case also the Removal Opponent), had the requisite intention to use, or authorize use, of the Trade Mark. However, the Removal Opponent, and not Mrs. Lynch, is the registered owner of the Trade Mark.
The conflating of separate legal entities seen in the evidence, along with Mrs. Lynch’s own comments, creates certain ambiguity as to whether the Removal Opponent has used or authorized the use of the Trade Mark. This is not assisted by the lack of direct evidence as to the relationship between SWWA and the Removal Opponent.
Having noted the ambiguity, I do not consider this, nor the fact that Mrs. Lynch mistakenly refers to herself as the Trade Mark owner, as fatal to the rebuttal of the non-use application. While it reveals a misunderstanding on her behalf, I am of the opinion Mrs. Lynch remains best placed to attest to any alleged use of the Trade Mark as she can, at the very least, and by virtue of her positions, be considered a controlling mind behind both the Removal Opponent and SWWA.[22] There is no doubt of this in light of the evidence before me and I accept any alleged use or intended use by SWWA is likely, on the balance of probabilities, to be authorized by and therefore amount to use (or intention to use) by the Removal Opponent.[23]
[22] Blackmarket.com.au Pty Ltd v VinoMofo Holdings Pty Ltd [2018], [24].
[23] Section 7(3) of the Act.

Use, or intention to use, the Trade Mark

The onus placed on the Removal Opponent to demonstrate its intention to use the Trade Mark is not high, given the mere act of applying for a trade mark is prima facie evidence of an intention to use it.[24] A further positive declaration made by the Removal Opponent, regarding its intention, may be sufficient to shift the onus to the Removal Applicants.[25] As held by the Delegate in Structureco Inc v Starite Distributors Pty Ltd:
Although the opponent to removal does bear the initial onus, in accordance with the legislation, I think that, in the case of applications for removal under s 92(4)(a), where the primary allegation regards the state of mind of an applicant for registration about whether it intends to use a mark in good faith, then that onus is not high. I believe that it is so low that it can be overcome if the opponent or its agent states that it was the case that the applicant for registration had an intention to use the mark in good faith.[26]
[24] Aston v Harlee Manufacturing Co [1960] HCA 47; (1960) 103 CLR 391, at 401.
[25] Secondment Pty Ltd v MCI Group Holdings SA [2013] ATMO 71, [9].
[26] (2000) 49 IPR 209; [2000] ATMO 31.
Alternatively, demonstrated use of a trade mark in good faith prior to the removal application is sufficient to discharge the onus on the opponent under section 92(4)(a) of the Act.[27]
[27] Pierson’s Pro-Health Pty Ltd v Allan Sutton [2012] ATMO 52, [14].
In this regard, Lynch 1 makes the following unequivocal statement:
My Trade Mark is being used in Good Faith since April 2014.[28]
[28] Lynch 1, paragraph C)v.
Annexures 1A to 1J, which I have described above, are led in support of this statement. Of these, I would consider the SWWA Advertisement which, when viewed in light of Mr. Nicol’s concession and the Removal Applicants’ E2 advertisement extract, as the strongest potential instance of the Removal Opponent’s use of the Trade Mark.
I note the Removal Applicants’ arguments with regards to the Removal Opponent’s evidence, the crux of which I shall discuss further below. However, for completeness, I think it relevant to confirm the presence of the SWWA business cards, the SWWA fridge magnets, the Southern Downs Council letter, the SWWA Advertisement and the Original SWWA website all evidence, at the very least, an intention to use the Trade Mark.
In the face of the evidence mentioned and the statements of use by the Removal Opponent, the onus shifts to the Removal Applicants to demonstrate that any use and/or intention at the time of filing the Trade Mark was not in good faith.[29]
[29] Pierson’s Pro-Health Pty Ltd v Allan Sutton [2012] ATMO 52, [18].

Use in Good Faith

Although not expressed in such terms, I am of the opinion the crux of the Removal Applicants’ argument goes to the ‘genuineness’ of the Removal Opponent’s Trade Mark use. That is, the Trade Mark has not been used by the Removal Opponent for a genuine commercial purpose.
Such considerations fall under the notion of use ‘in good faith’. In the decision of Woolly Bull Enterprises Pty Ltd v Reynolds it was observed the expression “use in good faith” in the context of s 92 of the Act has a well understood meaning, namely “real” as opposed to token use in a commercial sense.[30] Further, immunity from attack could not be granted if assertions of use were based on fictitious or colourable use, rather than genuine or bona fide use in a commercial sense.[31]
[30] [2001] FCA 261, [16]; [2001] 107 FCR 166 at [153]- [154]; As referred to in Liquideng Farm Supplies Pty Ltd v Liquid Engineering 2003 Pty Ltd [2009] FCAFC 7, [52].
[31] See Electrolux Ltd v Electrix Ltd (1954) 71 RPC 23, 42 per Morris LJ; Johnson & Johnson Australia Pty Ltd v Stirling Pharmaceuticals Pty Ltd (1991) 30 FCR 326, 354; Affirmed in E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2010] HCA 15; (2010) 241 CLR 144; (2010) 86 IPR 224.
Consequently, for use to be described as real or genuine (or ‘bona fide’), it cannot be use manufactured solely to defeat an application for non-use.[32] Having determined the Removal Opponent’s intention to use the Trade Mark, the onus is on the Removal Applicants to establish this has been for a purpose other than deriving profit or establishing goodwill in the course of trade.[33]
[32] Pierson’s Pro-Health Pty Ltd v Allan Sutton [2012] ATMO 52, [23].
[33] Imperial Group Ltd v Philip Morris & Co Ltd [1982] FSR 72. As referred to by the Delegate in Pierson’s Pro-Health Pty Ltd v Allan Sutton [2012] ATMO 52, [23].
Mr. Nicol alleges on several occasions SWWA is ‘not trading’.[34] I have considered the evidence submitted in support of each instance of the allegation and do not find it to be persuasive. Its cogency is undermined due to, inter alia, the same misunderstanding seen in Lynch 1 and 2 in that it conflates the actions of separate legal entities. In this manner, much of the evidence is led to show impropriety by Mr. Lynch.
[34] The Nicol Declaration, paragraph A), C) and D).
I would also note the SAMVOA complaint wherein Mr. Lynch claims he was illegally ousted as managing director of Scarab Aus.[35] Contained within the same complaint Mr. Nicol responds:
Lynch was not “illegally ousted” as managing director… Lynch was sacked as [managing director], because he had secretly opened a new company, [SWWA], and became the [managing director] of this new company. He was then diverting all projects, assets and company funds to his new company, and then became abusive, secretive and obstructive. Lynch also secretly applied for the registration of the [Trade Mark] at the same time he started his new company.
The Trade Mark was copied from our South African Scarab logo, but enhanced to make it better for reproduction, without pixilation… However, the original design, and all the goodwill remains my property.[36]
[35] Exhibit J7.
[36] Exhibit J8.
Mr Nicol’s closing statement in the Nicol Declaration also provides:
[The Lynch’s] only hope is to attach themselves to something which they can be seen (sic) as worthy. Scarab has an incredible reputation, a long faultless history and a huge acknowledgement of our hard work by the public at large.
Setting aside the potential matter of ownership,[37] the above passages indicate the Trade Mark was applied for while Mr. Lynch held a position with Scarab Aus. Moreover, it appears to me the Removal Applicants considers the intention to register the trade mark lay solely in a decision by Mr. Lynch, and thus SWWA, to avail itself of the (unsubstantiated) goodwill and reputation which the Removal Applicants alleges to have in the name Scarab. I infer from the above the Removal Applicants considers this intention to be the kind of ‘colourable’ use mentioned earlier, and not an intention to use in good faith.
[37] Actions under s 92 of the Act are not an appropriate forum in which to determine ownership matters. Such action is suited to s 58 of the Act during opposition to registration of the trade mark.
Regardless, the alleged conduct of Mr Lynch has limited relevance in the consideration of whether the use of the Trade Mark has been ‘in good faith’. Parallels can be drawn between these circumstances and those seen in Liquideng Farm Supplies Pty Ltd v Liquid Engineering 2003 Pty Ltd (‘Liquid Engineering’).[38] In Liquid Engineering it was argued before the Court:
… the use of the trade marks in question was "not in good faith", since those words are wide enough to cover the present circumstances in which [the respondent] intended to appropriate the marks of [the appellant] by using them in relation to the same goods in order to take advantage of the positive association between those goods and LEL, and where the activity began while [the respondent] was still employed by LEL.
[38] [2009] FCAFC 7.
The Court, in reviewing the relevant authorities, did not accept such a wide interpretation of ‘in good faith’ and instead held s 92 required:
“… no more than a genuine intent to use the mark for commercial purposes and that the reference to bona fide intention to use is not sufficiently wide to encompass the circumstances of the present case.”[39]
[39] Ibid, [56].
Furthermore, in Pierson’s Pro-Health Pty Ltd v Allan Sutton, the Delegate held:
Upon reviewing the legal precedent on this issue… it cannot be said that trade mark use “to the requisite level of commerciality absolves [or exonerates] any colourable purpose” but ‘colourable purpose’ should not be interpreted as expanding upon the definition of ‘in good faith’ accepted by the courts. In particular, I note the refusal of the Full Federal Court in [Liquid Engineering] to take a broader view of ‘good faith’ over and above a demonstrated genuine intent to use the trade mark for commercial purposes. At the risk of repetition, use in good faith does not involve a consideration of “honesty or subjective good intentions”.[40]
[40] [2012] ATMO 52, [24].
Accordingly, it is not necessary to determine whether the Removal Applicants, or a potential agent thereof, has applied for the Trade Mark honestly and whether the Trade Mark has since been used with good intentions. Rather, it requires a determination of whether the Trade Mark has been genuinely used, or that there was a genuine intention to use it, by the Removal Opponent for commercial purposes.
I have already found the Removal Opponent has demonstrated, at the very least, an intention to use the trade mark. There is nothing in the Removal Applicants’ evidence which establishes the Removal Opponent lacked an intention to use the Trade Mark in good faith at the time of filing the Trade Mark application.

Decision

I consider the Removal Opponent has rebutted the allegation of non-use. Therefore, the opposition to removal under section 92(4)(a) of the Act has been successful. Accordingly, the Trade Mark will remain on the Register.

Costs

An award of costs normally follows the event. The Removal Opponent has been successful and I award costs against the Removal Applicants under section 221 of the Act in the allowable amounts set out in Schedule 8 of the Regulations.

Aaron Walters

Hearing Officer

Oppositions and Hearings

4^th May 2018

[2018] ATMO 65

4 May 2018