Moon Lake Investments PL v TasFoods Ltd

[2018] ATMO 104

TRADE MARKS ACT 1995

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

Re:Opposition by Moon Lake Investments Pty. Ltd. to registration of trade mark application 1736692 (29, 30) Van Diemen’s Land Milk and 1736693 (29, 30) – Van Diemen’s Land Dairy in the name of TasFoods Ltd.

Delegate:	M.Cooper
Representation:	Decision on the written record
Decision:	2018 ATMO  104 Opposition under s.52 of the Trade Marks Act 1995: ss.42, 58, 60, 62A considered – no opposition grounds established – trade marks to proceed to registration. Costs awarded against the Opponent.

Background

1.     This matter concerns an opposition by Moon Lake Investments Pty. Ltd. (‘the Opponent’), under s.52 of the Trade Marks Act 1995 (‘the Act’), to registration of the trade marks detailed below in the name of TasFoods Ltd. (‘the Applicant’):

Trade Mark No.	1736692	1736693
Trade Mark: (“the Trade Marks”)	Van Diemen’s Land Milk	Van Diemen’s Land Dairy
Filing date: (“the priority date”)	24 November 2015
Goods: (“the Goods”)	Class 29: Dairy produce; Dairy products; Cow’s milk; Milk; Milk products Class 30: Ice cream; ice cream products

2.     The Trade Marks were examined and advertised as accepted for possible registration on 14 April 2016 in the Australian Official Journal of Trade Marks.

3.     On 14 June 2016, the Opponent filed a Notice of Intention to Oppose registration of the Trade Marks. On 14 July 2016, a Statement of Grounds and Particulars (‘SGP’) was filed which cited opposition grounds under sections 42, 58, 60 and 62A of the Act.

4.     On 18 August 2016 the Applicant filed a Notice of Intention to Defend in respect of both Trade Marks.

5.     As neither party requested a hearing, IP Australia wrote to the parties on 29 June 2017 advising that a decision would be made on the written record and provided them with a period of time within which submissions should be filed.

6.     On 31 July 2017, the Applicant filed written submissions. No submissions were filed by the Opponent.

Evidence

7.     Evidence in Support of the opposition was filed by the Opponent on 25 November 2016. On 28 February 2017, the Applicant filed its Evidence in Answer. The Opponent did not file Evidence in Reply.

8.     The Evidence in Support consisted of a declaration by Christopher John Round, a partner at the legal firm representing the Opponent, K&L Gates. The declaration was made on 25 November 2016 and included Annexures CJR-1 to CJR-24, of which Annexures CJR-16 and CJR-17 were claimed as confidential (“the Round declaration”).

9.     The Evidence in Answer filed by the Applicant consisted of a declaration by one of its directors, Jane Frances Bennett, made on 27 February 2017 (“the Bennett declaration”) and which included Annexures JFB-1 to JFB-5.

10.     As a delegate of the Registrar of Trade Marks, I have proceeded to decide the matter on the filed material and the reasons for the decision are set out below.

The Opponent’s evidence

11.     The Round declaration outlined the history of the Opponent’s predecessor, the Van Diemen’s Land Company (“VDLC”), which was established by Royal Charter on 10 November 1825, and the assets of which were purchased by the Opponent on 30 March 2016.

12.     At its inception, VDLC had been granted 350,000 hectares of land in Woolnorth, Tasmania which was initially used for “grazing, sheep, beef and goats”. In 1994 a “substantial dairy herd” was introduced. “VDL Farms” was said to be the trading name for the various dairy farms owned and operated by VDLC.

13.     As a result of the purchase, the Opponent operates 25 dairy farms and associated operations in Tasmania and is claimed to be “the largest dairy farming business in Australia”. The Round declaration further asserted that “it is highly likely that those in the dairy industry did and would still associate the VDL Farms with the name ‘VAN DIEMEN’S LAND’ ”.

14.     Mr. Round claimed the first use of “the VAN DIEMEN’S LAND trade mark” was in 1994 “when the name VAN DIEMEN’S LAND was used in connection to dairy farming services at the VDL Farms and to sell milk produced at the VDL Farms to dairy companies and dairy product exporters.” He further claimed that VDLC, and now the Opponent, “has continuously used the name VAN DIEMEN’S LAND in relation to the Goods in Australia.” It was further claimed that these are closely related goods and services (presumably to the Trade Marks). Various examples of the purported use of the Opponent’s trade mark, which was specified in the SGP as “VAN DIEMEN’S LAND”, were provided. These are discussed further below (paragraph 42).

15.     Mr. Round referred to the Opponent’s filing of seven trade mark applications in March and April 2016, which also use the words “Van Diemen’s Land” and two of which, 1758430 and 1758432, are identical to the Trade Marks. He claimed all the marks (“Moon Lake’s Trade Marks”) cover classes 29 and 30 for the same or similar products and two also cover class 32 for soy based beverages. The examiner’s rejection of these marks is said to be based on the earlier filed Trade Marks.[1]

[1] The examiner has not rejected these trade marks. The Opponent’s trade marks have not proceeded to acceptance due to (amongst other TMs) the presence of the Trade Marks on the Register.

16.     Mr. Round noted the unsuccessful sale negotiations between the Applicant and VDLC and the successful purchase of VDLC by the Opponent. Various documents were annexed which confirmed the sale. These documents, annexed at CJR-16 to CJR-22, included the confidential “Agreement for Sale and Purchase of Business and Assets”, between the then-owner Tasmanian Land Co Limited (TLC), which included its subsidiaries VDLC and TFPL (Tasman Farmdale P/L), and the Opponent and its guarantor (“the Sale Agreement”).

17.     Particular reference was made to the injunction obtained by the Applicant, to whom TLC had previously agreed to sell VDLC assets, restraining TLC from taking any steps to terminate that agreement. According to the declaration, a trial had been set down for February 2016 however this was discontinued when, prior to this, in January 2016, the parties, which by then also included the Opponent, agreed to settle the matter. The proceedings were discontinued and the Applicant and Opponent entered into a Deed of Release. Mr. Round noted the clauses in which the Applicant had undertaken “not to delay or frustrate [the Opponent] in completing the Agreement”.[2] “Intellectual property” and “Business Intellectual Property” were included as assets in the Sale Agreement, as was a Warranty that the assets sold were “those necessary to operate the business”. Mr. Round noted that “[t]rade marks are assets necessary to operate the VDLC business” and therefore they “constitute assets acquired under the Agreement”. It was claimed that, because the Applicant had applied to register the Opponent’s trade mark, the Opponent “is presently unable to use the Van Diemen’s Land name to brand the Goods”. Mr. Round claimed that this “has frustrated [the Opponent’s] business”. In addition, Mr. Round maintained that, in filing and failing to relinquish the Trade Marks, the Applicant had acted in bad faith and breached its agreement with the Opponent “not to delay or frustrate [the Opponent] in completing the Agreement.” He further claimed that neither the Opponent nor VDLC ever consented to the Applicant’s use of its trade mark, that is, the expression “VAN DIEMEN’S LAND”.

[2] That is, the Sale Agreement by TLC to sell the business and assets to the Opponent, discussed further below.

18.     In conclusion, Mr. Round asserted that the words VAN DIEMEN’S LAND have been used as a trade mark for the Goods by the Opponent and its predecessor since 1994, and for related services since 1825. He maintained that it is the true owner of this mark, and any derivative form, with respect to the Goods in Australia. Furthermore, due to its extensive use, the Opponent and its predecessor had “acquired a substantial reputation in the VAN DIEMEN’S LAND trade mark before the priority date of [the Applicant’s] Trade Marks”. Therefore the Applicant’s application to register the Trade Marks was in bad faith and their use “would mislead or deceive the Australian public into believing there was a connection between [the Applicant] and VDLC which does not exist.”

The Applicant’s evidence

19.     The Applicant provided the declaration of Jane Frances Bennett, currently the Applicant’s managing director and formerly a VDLC (and TFPL) director for the period 4 March 2014 to 5 October 2015.

20.     She explained that the Applicant’s business was established in mid-2015 “to build a stable of premium Tasmanian food brands to sell products on a national and export platform, directly marketed to retail customers.” She outlined the Applicant’s various brands which included dairy and poultry products and condiments. She claimed the plan was to develop brands to “leverage off the premium attributes of ‘brand Tasmania’” and to “build a new brand to market dairy-related product” with a name “synonymous with the island”.  She stated that a wholly-owned subsidiary called Van Diemen’s Land Dairy Pty. Ltd. had been established in October 2015 for this purpose. A schedule of the costs incurred in establishing the business was provided in the evidence as were documents demonstrating brand development.

21.     In response to the Round declaration, Ms. Bennett referred to the assertions made regarding the Opponent’s use of “VAN DIEMEN’S LAND” as a trade mark and observed that the claims were not supported by any evidence. She noted that the Opponent acknowledged that it would like to use the Trade Marks but has not done so, and claimed “[n]or had VDLC when it owned and operated the dairy farms sold to [the Opponent]”.  Her specific claims are discussed further below in the relevant opposition ground.

22.     The Bennett declaration concluded:

·    The Applicant spent time and incurred significant costs in developing the Trade Marks and intends to keep doing so as part of overall branding and business strategy.

·    There was no evidence of the Opponent’s use, or independent development, of the Trade Marks (or substantially identical or deceptively similar marks) in relation to the sale of goods of the same description as the goods the subject of the Trade Marks, nor the supply of services closely related to these products.

·    The only evidence of use provided by the Opponent was of use of the VDLC corporate name and coat of arms. There was no evidence of use of the words VAN DIEMEN’S LAND as a trade mark.

·    There was no evidence of the claimed supply of dairy farming services, said to be closely related to the dairy products the subject of the Trade Marks, by the Opponent or its predecessor.

·    The only goods sold by the Opponent and its predecessor were raw unprocessed milk, which is not the same or the same or the same kind of thing as the consumer focussed products the subject of the Trade Marks.

·    VDLC has never sold or marketed dairy products to consumers under the Trade Marks or at all. The Australian public would therefore not be deceived or misled into believing there was a connection with the Opponent’s raw milk products.

·    The Applicant has not breached any obligation under the Deed of Release or acted in bad faith in pursuing the Trade Marks applications which were part of its business strategy begun before the Opponent acquired VDLC’s farms and cows.

Submissions

23.     Only the Applicant filed submissions. In those submissions, the Opponent’s assertions of VDLC’s use of the Trade Marks in association with dairy goods and related services were rejected. The Applicant maintained that the Trade Marks were not the property of VDLC and were not purchased under the Sale Agreement completed on 30 March 2016.

24.     The submissions relied on the Applicant’s evidence that VDLC’s dairy business involved dairy farming and the production of unprocessed milk and milk solids, which it supplied to a single commercial customer, Fonterra, for processing and sale under its [Fonterra’s] own brands. No sale of fresh milk or dairy products for human consumption, or sales to retail customers, or any branded milk sales at all, were made.

25.     It was also submitted that the Applicant’s evidence had demonstrated that it had, prior to the Opponent’s acquisition of VDLC, in good faith, spent considerable time, effort and money in developing its Van Diemen’s Land brand-related business.

26.     In addition, it was noted that none of the Applicant’s evidence had been disputed by the Opponent, despite the opportunity for it to do so in evidence in reply.

27.     The submissions noted an article in a Hobart newspaper in October 2016 reporting the Opponent’s launch of its brand “VAN Milk” and associated dairy products for sale in China. This was said to demonstrate that the Opponent “has for some time now not intended to use Van Diemen’s Land as a trade mark.”

28.     The Applicant provided evidence of its successful registration of the ‘Van Diemen’s Land Dairy” trade mark in People’s Republic of China, in respect of dairy products which, it was submitted, further demonstrated its commitment to the Van Diemen’s Land brand.

29.     On the basis of the lack of evidence to support the Opponent’s claims of relevant prior use, and the weight of Applicant’s evidence, it was contended that the Applicant was entitled to registration of the Trade Marks.

30.     A request for an award of costs was made.

Grounds, onus and standard of proof

31.     The Opponent bears the onus of establishing one or more of the grounds of opposition set out in its SGP and the standard of proof required is on the balance of probabilities.[3]

[3] Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156 affirming the approach of Gyles J in Pfizer Products Inc. v Karam [2006] FCA 1663; (2006) 70 IPR 599 [6-26]

32.     The time at which a ground of opposition must be established is the date of filing of the application(s) for registration.[4] In this case that date is 24 November 2015.

[4] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 [595]

Consideration and reasons

33.     The Opponent has particularised a number of grounds of opposition however it has not provided any submissions in relation to them. In the circumstances I have had regard to the materials filed by the Opponent, that is, its SGP and the Round declaration, in assessing its claims. I have also had regard to the Bennett declaration and the submissions of the Applicant.

Grounds of Opposition:

Section 58

34. Section 58 of the Act provides:

58 Applicant not owner of trade mark

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.

35.     The recent decision of the Full Federal Court in Anchorage Capital Partners Pty Ltd v ACPA Pty Ltd. confirmed, among other things, that, while trade mark ownership may be acquired by the act of applying for registration of a trade mark, such a claim to ownership of the mark may be defeated if another person has previously used the mark, or a substantially identical mark, in Australia as a trade mark in relation to the same goods or services, or goods or services of the same kind, as those that are the subject of the application for registration. [5]

[5] Anchorage Capital Partners Pty Ltd v ACPA Pty Ltd [2018] FCAFC 6 [49]

36.     The Full Federal Court in Pham Global also accepted as correct the primary judge’s identification of the relevant applicable principles in relation to s.58 as follows:

It was common ground that to succeed on the ground of opposition under s 58 of the Trade Marks Act, Insight Clinical Imaging must establish that:

a)the IR composite mark is identical or substantially identical to the ICI composite mark: Carnival Cruise Lines Inc v Sitmar Cruises Limited [1994] FCA 936; ..

b)the ICI composite mark has been used in respect of goods or services as “the same kind of thing” as the IR composite mark: Re Hicks’ Trade Mark [1897] VicLawRp 118; and

c)it had the earlier claim to ownership based on its use of the ICI composite mark before the filing of the IR composite mark application or any use of the IR composite mark by Insight Radiology: Settef SpA v Riv-Oland Marble Co (Vic) Pty Ltd 10 IPR 402 at 413.[6]

[6] Pham Global Pty. Ltd. v Insight Clinical Imaging Pty. Ltd. [2017] FCAFC 83 [50]

37.     In relation to the last principle, Deane J said in  Moorgate Tobacco Co Ltd v Philip Morris Ltd (No.2):

The prior use of a trade mark which may suffice, at least if combined with local authorship, to establish that a person has acquired in Australia the statutory status of "proprietor" of the mark, is public use in Australia of the mark as a trade mark, that is to say, a use of the mark in relation to goods for the purpose of indicating or so as to indicate a connexion in the course of trade between the goods with respect to which the mark is used and that person.[7]

[7] Moorgate Tobacco Co. Ltd. v Philip Morris Ltd (No.2) [1984] HCA 73; 156 CLR 414 [432]

38.     The Opponent claimed ownership of the (unregistered) trade mark “VAN DIEMEN’S LAND” on the basis of its use by its predecessor company, VDLC, for several years prior to the application for the Trade Marks.  Specifically, the Opponent’s SGP asserted that its predecessor “has continuously used the Van Diemen’s Land mark (“Opponent’s Mark”) in Australia for dairy and milk products since 1825. Notwithstanding its knowledge of the opponent’s rights in the Opponent’s Mark, the Applicant has chosen to file trade mark applications for substantially identical or deceptively similar marks.”

39.     This claim is repeated in the Round declaration, although the date of first use of the VAN DIEMEN’S LAND trade mark in Australia in respect of the designated goods was said to be in 1994. Continuous use since that date “in relation to the goods in Australia” was claimed. It was also asserted that “VDLC and [the Opponent] have continuously used the Van Diemen’s Land trade mark in connection to dairy farming services and in connection to the sale of milk to dairy companies and dairy product exporters.”[8] It was also later acknowledged however that “[a]ll of the VDL Farms supply Fonterra”. [9]

[8] Round declaration paragraph 25.

[9] Round declaration paragraph 27. VDL Farms is used throughout the declaration to signify the dairy farms owned and operated by VDLC – the predecessor to the Opponent (paragraph 6 of Round declaration).

40.     The Round declaration relied on the following contexts as evidencing prior use of the trade mark by the Opponent and its predecessor:

·    A sign on the Woolnorth property “Van Diemen’s Land Co”.

·    A booklet entitled “The Van Diemen’s Land Company”.

·    The Van Diemen’s Land Company’s Act 1877 (UK).

·    A photo of a company vehicle displaying the VDLC “logo” [coat of arms] with the words Van Diemen’s Land Company underneath.[10]

·    An email bearing the VDLC logo and the name of the Company Secretary above the words “The Van Diemen’s Land Company”.

·    Photograph of the Opponent’s office door displaying the VDLC logo and the words “Van Diemen’s Land Company”.

·    Copy of the first page of an employment agreement displaying the VDLC logo and the words “The Van Diemen’s Land Company”

·    Copy of the first page of a consultancy agreement displaying the VDLC logo and the words “The Van Diemen’s Land Company”

·    Advertisement for sharefarmers displaying the VDLC logo and the words “The Van Diemen’s Land Company”.

·    Letter sent to a professional services firm in relation to the company’s financial report displaying the VDLC logo and the words “The Van Diemen’s Land Company”

·    Newspaper articles concerning the sale of VDLC to the Opponent. Articles entitled “Iconic Tasmanian company Van Diemen’s Land in $170m dairy arm sell-off by New Zealand firm”,“$280m Van Diemen’s Land company sale decision”, “Australia’s largest dairy firm Van Diemen’s Land Company sold to Chinese buyer”, “Chinese buy nation’s largest dairy, Van Diemen’s Land Company”, “Scorn poured on Van Diemen’s Land sale”, “Sale of Van Diemen’s land Company to Chinese approved by government”, “VDL dairy company sale approved by Foreign Investment Review Board”, “Qantas to start weekly Hobart to Ningbo China flights, carrying milk”.

·    VDLC Annual report for 2010.

[10] The Round declaration refers frequently to the VDLC “logo” – in all cases that was a reference to the VDLC coat of arms. There is nothing in the Opponent’s materials which indicated a claim that its use of the coat of arms constituted use as a trade mark.

41.     In her declaration, Ms. Bennett denied that the Opponent or its predecessor has used “Van Diemen’s Land” as a trade mark, either in relation to goods and/or services claimed, or at all. She specifically refuted the Opponent’s claim to have first used the Van Diemen’s Land trade mark in 1994 or that “the name Van Diemen’s land was used in connection to dairy farming services and to sell milk produced at farms to dairy companies and dairy product exporters”.

42.     In relation to references to the VDLC logo, it was noted that it is “in fact, a coat of arms” and “none of the evidence demonstrated that it was used as a trade mark to sell dairy products to consumers or at all.” Ms. Bennett maintained that the Opponent’s evidence did not demonstrate “intention to use a trade mark to distinguish goods or services in the course of trade from goods or services provided by another person.”

43.     In particular, Ms. Bennett referred to her time as director of VDLC, stating that “VDLC had no need for a brand, and did not use a brand, to sell its raw unprocessed milk” and “did not process any milk or sell any dairy products to consumers or anyone else other than Fonterra.” By way of support, she referred to and annexed relevant pages from the VDLC 2015 annual report which described the business as “the production and sale of milk solids” to Fonterra.  “VDLC and TFPL’s dairy farming business and related activities simply encompassed traditional dairy farming. They did not involve any retail sale, the sale of any retail product, the wholesale sale of any dairy product other than raw unprocessed milk or the use of any brand, label or other trade mark.”

44.     She maintained that “even if VDLC had used the name ‘Van Diemen’s Land’ in connection with the supply of dairy farming services to other people… which is denied, none of these farm services would be remotely related to the sale of the consumer focussed dairy products in respect of which TasFoods’ seeks registration of its Van Diemen’s Land Dairy and Van Diemen’s Land Milk trade marks.”

45.     As noted above, to succeed on this ground of opposition, one of the things that the Opponent must establish is that it had the earlier claim to ownership based on its use of the mark before the filing of the Trade Mark applications or any use of them by the Applicant.

46.     In Aldi Stores Ltd Partnership v Frito-Lay Trading Company GmbH, Hill J said:

In most, if not all cases, the question whether there has been use as a trade mark will be determined by an objective examination of the use in the context in which it appears.[11]

[11] Aldi Stores Ltd Partnership v Frito-Lay Trading Company GmbH [2001] FCA 1874 [30]

47.     Having regard to the Opponent’s exhibits, I observe that each time the Opponent’s claimed trade mark, “Van Diemen’s Land”  appears, it is as part of the company name. Even when the words appear in the coat of arms/logo they appear as “Van Diemen’s Land Company”.

48.     In this context the comments of Lander J in Shahin Enterprises Pty Ltd v Exxonmobil Oil Corporation (“Shahin”) are pertinent:

The applicant contended that it had used a sign in the course of its trade and therefore it had used a mark. I reject that argument. I think the applicant has used a sign to brand its business and has proved, as I have said, that it was its intention for the future. But that is not what is envisaged in s 17 when that section speaks of using the sign in the course of trade. Section 17 is concerned with a sign that is used in the course of trade for a specific purpose. The purpose that must be established is to distinguish the applicant’s goods or services from any other traders, goods or services.

There is no proof that the sign has been used or intended to be used to distinguish goods or services provided by the applicant in the course of trade from goods or services provided by any other. Even if it might be said that the use was in the course of trade that does not establish that the description ‘On the Run’ or ‘On the Run Convenience Store’ is a mark. That is not enough by itself.[12]

[12] Shahin Enterprises Pty Ltd v Exxonmobil Oil Corporation [2005] FCA 1278 [74-75]

49.     Further, as Finkelstein J said in Colorado Group Ltd. v Strandbags Group Pty. Ltd.:

It has been suggested that the use of the word on the shopfront amounted to trade mark use in relation to goods. I do not accept that this use of the word, even if it were a fancy word, is use as a trade mark. In one way or other, the use of a word or device as a mark must involve its use in connection with particular goods. Unless there be some connection between the two the mark would not identify the source of the goods. A storefront name does not serve that purpose particularly where a variety of goods and "brands" are sold in the store. The average consumer would not think that a shop name is a badge of origin: rather he or she is likely to think that it is the name, or the business name, of the proprietor of the establishment.[13]

[13] Colorado Group Limited v Strandbags Group Pty Limited (No 2) – Finkelstein J at para 12 - overturned on appeal but not on this point

50.     As noted, the evidence provided by the Opponent to demonstrate use of the trade mark “Van Diemen’s Land”, demonstrated use of that phrase in the context of the company name and its display at various locations and situations in the course of VDLC’s business dealings. That is, it did not appear on or in relation to any goods or services but as part of identifying the company in the course of its normal business activities such as communicating with other professionals, entering into legal agreements, or engaging employees or subcontractors (share farmers). There is no apparent use in relation to goods or services “for the purpose of indicating or so as to indicate a connexion in the course of trade between the goods with respect to which the mark is used” and the company. Nor is there anything in the objective evidence before me which demonstrates “an actual trade or offer to trade in goods bearing the mark” before the priority date. I attach significant weight in this regard to the evidence of Ms Bennett, as a former director of the Opponent’s predecessor, VDLC, whose claims in this regard were unchallenged by the Opponent.

51.     For the above reasons, I do not consider that the Opponent has demonstrated prior use of the expression “Van Diemen’s Land” as a trade mark such as to defeat the Applicant’s claim to ownership of the Trade Marks.

52. It follows that the Opponent has not established its s.58 ground of opposition.

Section 60

53. Section 60 provides as follows:

Trade mark similar to trade mark that has acquired a reputation in Australia

The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:

(a)  another trade mark had, before the priority date for the registration of the first          -mentioned trade mark in respect of those goods or services, acquired a reputation in Australia; and
(b)  because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.

Note:          For priority date see section 12.

54. Therefore to establish the s.60 ground of opposition, an Opponent must demonstrate that, at the priority date of the Trade Marks,

·    there was another trade mark

·    that had acquired a reputation in Australia and

·    because of that reputation, use of the Trade Marks would be likely to deceive or cause confusion.

55.     In respect of this ground, the Opponent claimed in its SGP, in relation to its mark “Van Diemen’s Land” that

VDLC has continuously used the Opponent’s Mark in Australia for dairy and milk products since 1825. As a result the Opponent has acquired a substantial reputation in the Opponent’s Mark due to extensive use before the priority date of TM nos. 1736692, 1736693 (Disputed Marks). Because of the reputation it enjoys in the Opponent’s Mark and the similarity between the Opponent’s Mark and the Disputed Marks, use of the Disputed Marks would be likely to deceive or cause confusion.

56.     These claims were later contradicted by other evidence of the Opponent which demonstrated that VDLC did not introduce dairy farming to its property until 1994[14]. In his declaration Mr. Round merely asserted that the Opponent and its predecessor “have acquired a substantial reputation in the VDL trade mark due to extensive use before the priority date…”

[14] Round declaration paragraph 6

57.     Given my above findings, that is, that the Opponent’s use of “Van Diemen’s Land” occurred in the context of its business use and did not constitute use as a trade mark, there is no relevant trade mark against which to assess reputation. That is, there was not, as claimed by the Opponent, another trade mark which had acquired a relevant reputation at this Trade Marks’ priority date.

58. Section 60, therefore fails at the threshold and on this basis this ground of opposition is not established.

Section 42(b)

59. Section 42 of the Act provides:

Trade mark scandalous or its use contrary to law

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.

60. In its SGP the Opponent claimed under this section of the Act that:

The use of the Disputed Marks by the Applicant is contrary to law under section 42(b) as it constitutes breaches of section 18 and section 29 of the Australian Consumer Law and the tort of passing off. If TasFoods Limited (Applicant) uses the Disputed Marks for the goods claimed in class 29 and 30, that use is likely to deceive or confuse consumers into thinking that the Applicant and its goods have a sponsorship, affiliation, approval or other relationship with the Opponent or the Opponent’s goods when this is not the case.

61.     The Applicant maintained that there had been no use by the Opponent of “Van Diemen’s Land” as a trade mark. Consequently no issues could arise relating to misleading or deceptive conduct or passing off in respect of its Trade Marks.

62. The Round declaration was not specific in this regard and, while Mr. Round made allegations of the Applicant’s breach of its undertakings in the Deed of Release signed by the parties, this was not the basis on which the s.42(b) ground of opposition was particularised. The allegations are discussed further below in the consideration of the s.62A opposition ground.

63.     As was noted by Rangiah J in Primary Health Care Limited v Commonwealth of Australia, with whom, in this regard, Katzmann J and Greenwood J agreed:

Section 42(b) of the TMA requires that the use of atrade mark “would be” contrary to law. It is not enough for a party opposing registration to show that s 18 of the ACL or s 52 of the TPA might be contravened. The opponent must prove, on the balance of probabilities, that the provision would be contravened by use of thetrade mark.[15]

[15] Primary Health Care Limited v Commonwealth of Australia [2017] FCAFC 174 [411]

64.     No evidence was relied on or referred to in support of this ground of opposition, nor were any reasons or submissions provided which indicated or suggested that the relevant legal tests were satisfied. There is nothing in the evidence before me from which I can draw any relevant inferences in this regard.

65. For these reasons I am not satisfied that use of the Trade Marks by the Applicant would be contrary to law. Therefore the section 42(b) ground of opposition has not been established.

Section 62A

66. Section 62A of the Act provides:

Application made in bad faith

The registration of a trade mark may be opposed on the ground that the application was made in bad faith.

67.     The Opponent has asserted in this regard, in its SGP, as follows:

The Applicant attempted to purchase VDLC and filed trade mark applications for the Disputed Marks. The opponent was the successful purchaser of VDLC and approached the Applicant to acquire the Disputed Marks since the opponent is the rightful owner of the Disputed Marks. The Applicant is aware that the opponent is operating a business by reference to the Opponent’s Mark. Notwithstanding its knowledge of the Opponent’s rights in the Opponent’s Mark, the Applicant has chosen to continue to prosecute trade mark applications for substantially identical or deceptively similar marks.

68.     In his declaration, Mr. Round alleged bad faith in respect of the Applicant’s filing of the Trade Mark applications on 24 November 2015 with knowledge that they belonged to the Opponent and without its consent. He asserted that the applications were filed “well before the transaction [presumably the Sale Agreement or the negotiations concerning the Deed of Release] had concluded and despite not being the successful purchaser of VDLC.”

69.     Noting the Applicant’s agreement/undertaking in the Deed of Release “not to delay or frustrate” the Opponent in completing the Sale Agreement, he maintained that the Trade Marks constituted “assets of the business” acquired under the Sale Agreement, and “obtaining registration” was “necessary for completion of the Agreement.” Therefore the failure of the Applicant to relinquish them to the Opponent had “frustrated” the Opponent’s business. He stated that “TasFoods’ conduct in filing trade mark applications for [the Trade Marks] and refusing to relinquish [them] to Moon Lake demonstrates bad faith and a breach of TasFoods agreement not to delay or frustrate Moon Lake in completing the Agreement.”

70.     The Applicant strongly rejected these allegations, denying there had been any use of “Van Diemen’s Land” as a trade mark by the Opponent or its predecessor, and noting that its Trade Mark applications were made well before the conclusion of the Sale Agreement between the TLC and the Opponent.

71.     In this context it is necessary to briefly outline the history of the Applicant’s attempted purchase, and the Opponent’s eventual purchase, of the VDLC assets.

72.     The Sale Agreement between the then-owner Tasmanian Land Co Limited (TLC) and the Opponent and its guarantor[16], was annexed as a confidential document to the Round declaration. Generally speaking, it provided for the sale and transfer of the business and assets of TLC, of which VDLC was a wholly owned subsidiary (a so-called “group company”). The Assets were specified to include “Business Intellectual Property” which was defined to mean “all intellectual property owned, used or held for use by any group company in, or in connection with, the Business (including registered Intellectual Property)”. “Intellectual property” was further defined to mean “trade marks, rights in domain names, copyright, patents, registered designs, circuit layouts, rights in computer software …. Whether registered or unregistered … and all rights of action, power and benefits in respect of the same”.  I note the specific intellectual property listed in a schedule to the Agreement does not include any trade mark similar to the Trade Marks.

[16] See paragraph 16 and  Annexure CJR-16

73.     The ASX announcements annexed to the Round declaration[17] indicate that the Applicant had entered into an agreement with TLC on 6 November 2015 for the sale to it of the VDLC assets. On becoming aware of the later sale to the Opponent, the Applicant, on or around 23 November 2015, had sought and was granted an injunction to restrain TLC from taking any steps to terminate their agreement. The Opponent was granted leave to intervene in the proceedings. On 3 December 2015 the Court decided not to extend the injunction however on 10 December 2016 a stay was granted in respect of this order. A trial was scheduled for 22 February 2016 but this was discontinued when the parties agreed to settle, with a payment to the Applicant, on 22 January 2016. The Deed of Release, as annexed to the Round declaration, evidenced that settlement.[18]

[17] Round declaration Annexure CJR-22

[18] Round declaration Annexure CJR-21. It was not expressed to be a confidential document.

74.     In respect of the bad faith allegations, Mr. Round relied on Clause 3 of the Deed of Release in which the Applicant agreed to take no action that would delay, frustrate, impede or prevent in any way the closing or completion of the Sale Agreement by TLC to the Opponent. Referring to the definitions of “Intellectual Property” and “Business Intellectual Property” in the Sale Agreement, Mr. Round maintained that the Trade Marks fell within those clauses and they were assets “necessary to operate the VDLC business”. By failing to relinquish them, it was claimed that the Applicant had “frustrated the [Opponent’s] business”, demonstrating bad faith and had breached “[the Applicant’s] agreement not to delay or frustrate [the Opponent] in completing the Agreement.”

75.     Ms. Bennett rejected as “patently false” the assertions that the Sale Agreement between TLC and the Opponent included the Trade Marks. The terms of the Agreement were acknowledged to include sale of the “Assets” which included “Business Intellectual Property” as well as generally “all other intellectual property…whether registered or unregistered”. She noted that neither the corporate name VDLC nor any derivation of it was specified as an asset. She further noted that the Sale Agreement did not provide for the sale of the corporate name, Van Diemen’s Land Company nor require VDLC to change its name. There was no provision “to acquire the name as a company name, business name, brand name, and trade mark or otherwise...” and that “the Agreement is simply silent on the name.” Ms. Bennett reiterated her previous assertions that, at the time the Agreement was made between the Opponent and its predecessors in November 2015, “VDLC did not own or use a brand to sell its product.”

76.     She further claimed that the Trade Marks for which the Applicant has applied are in respect of a range of dairy products (including ice cream) and “those trade marks were not included in the Assets agreed to be sold under the [Opponent’s] Agreement”.

77.     Ms. Bennett also strongly rejected the Round declaration’s assertion that the refusal by the Applicant to relinquish the Trade Marks demonstrated bad faith. She maintained that the Trade Marks were consistent with the key elements of the Applicant’s business strategy which had been initiated in mid-2015, well before the execution of the Release Deed in January 2016. She acknowledged the Applicant’s unsuccessful bid to buy the business but maintained that the acquisition was “not critical to [the Applicant’s] branded food products business.” She noted that the Sale Agreement made with the Opponent “makes no specific mention of the name Van Diemen’s Land as an Asset,” and that there was “no provision for acquisition …of that name or VDLC’s name” nor any restraint on its use. The current ASIC extract for the the Van Diemen’s Land Company was annexed (JFB-5), showing that it was controlled by same directors who controlled it at sale. It was said to demonstrate that the Opponent had not purchased VDLC’s name or coat of arms or the name Van Diemen’s Land.

78.     Ms. Bennett further denied that the Applicant had delayed or frustrated the Opponent in completing the agreement contrary to clause 3 of the Deed of Release. While acknowledging that the content of clause 3 required the Applicant to “take no action whatsoever that does or may delay… the closing or completion of the [Opponent’s] Agreement”, she noted that the deed was signed on 22 January 2016 but the Trade Mark applications were filed on 24 November 2015. Therefore, she claimed, the filing could not be said to “constitute ‘delaying’ or ‘frustrating’ action prohibited under clause 3”.  She further noted that the evidence demonstrated that the purchase had in fact been completed on 30 March 2016 and therefore Applicant could not be taken to have breached clause 3.

79. Section 62A was considered in Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) where Dodds-Streeton J said (emphasis added):

It is clear that bad faith for the purposes of s 62A must be at the time of the application in this case (22 December 2006) and must relate to the making of the subject of that application, which in this case is the composite word and device mark, rather than the mark TENNIS WAREHOUSE or TENNIS WAREHOUSE AUSTRALIA. Further, the onus of proving bad faith rests on the opponent. While the seriousness of an allegation of bad faith that “impugns the character of an individual or collective character of a business...” requires correspondingly cogent evidence (statement of the Hearing Officer in Maslyukov v Diageo Distilling Ltd [2010] EWHC 443 (“Maslyukov”), quoted with approval by Arnold J at [36] and [37]), the standard of proof is the balance of probabilities, rather than that of beyond reasonable doubt[19]

[19] Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) [2012] FCA 81 [145]

80.     And after examining the various UK and Australian authorities Dodds-Streeton J concluded at 165-167:

The formulation in United Kingdom authority of bad faith as falling short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in a particular area is, in my view, an apt touchstone. An overly literal application may, however, tend to negate the relevance attributed to the applicant’s mental state in the combined test preferred in Harrison.

Further, in my view, mere negligence, incompetence or a lack of prudence to reasonable and experienced standards would not, in themselves, suffice, as the concept of bad faith imports conduct which, irrespective of the form it takes, is of an unscrupulous, underhand or unconscientious character….

The question is whether, in all the particular circumstances, the applicant’s knowledge was such that his decision to apply for registration at the relevant date would be regarded as in bad faith by persons adopting proper standards.[20]

[20] Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) [2012] FCA 81 [165-7]

81.     Therefore, in assessing whether these Trade Mark applications have been made in bad faith, the issue is whether, given the Applicant’s knowledge, when the application was made, its conduct fell short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in the relevant area.[21]  

[21] Ibid.; DC Comics v Cheqout Pty. Ltd. (2013) 101 IPR 334 at 63

82.     In summary, the Opponent made two allegations of bad faith:

·    The Applicant filed the applications for registration of the Trade Marks knowing that they were owned by the Opponent and without its consent.

·    The Trade Marks were “assets” within the terms of the Sale Agreement and therefore ownership of them passed to the Opponent. The failure of the Applicant to relinquish them to the Opponent constituted a bad faith breach by the Applicant of its undertakings made in the Deed of Release because it frustrated or delayed the conclusion of the Sale Agreement.

83.     Pertinently, as Dodds-Streeton J noted, bad faith for the purposes ofs 62Ais to be assessed at the time of the application. In this application that date is 24 November 2015. The Deed of Release between the Applicant and the Opponent as provided was not signed or dated. The Applicant’s ASX announcement concerning settlement of the proceedings was dated 22 January 2016, several months after the filing of the Trade Mark applications. Therefore, to the extent the Opponent’s contentions regarding bad faith relate to the Applicant’s refusal to relinquish the Trade Marks following settlement of the court proceedings, and delaying or disabling the Opponent from completing the sale, these events occurred well after the filing date. Even if it could be argued that this later conduct sheds light on the intentions of the Applicant as at the priority date, the Applicant’s actions did not in fact prevent finalisation of the Agreement, which, on all the evidence, including that of the Opponent, was finalised on 30 March 2016. The Opponent has therefore failed to demonstrate that the Applicant’s refusal to hand over the Trade Marks did delay the sale. It follows that the Opponent’s allegations in this regard do not enliven s.62A of the Act.

84.     In relation to the first allegation, that the Applicant filed the Trade Mark applications in bad faith because it knew that the Opponent (or presumably, its predecessor) was the rightful owner of the Trade Marks, I note that the filing occurred around the time that the Applicant became aware of TLC’s purported sale to the Opponent. At that time, according to the annexed ASX announcements, the Applicant had an agreement with TLC for the sale of the business to it and had been granted an injunction to prevent TLC terminating that agreement (CJR-22, ASX announcement of 25 November 2015). Therefore, when the Trade Mark registration applications were filed, the objective evidence indicates that the Applicant was actively seeking to maintain its sale agreement with the then-owner of the VDLC assets. The issue of ownership was therefore unsettled and the allegation that the Applicant had knowledge at filing that anyone else owned the Trade Marks is not sustainable.

85.     Alternatively, Mr. Round maintained that the Trade Marks were embraced by the Sale Agreement and, from this perspective, it might be argued that the Applicant’s decision to register them was in bad faith precisely because ownership was not settled. As noted above, the terms of the Sale Agreement between TLC and the Opponent transferred all intellectual property, including unregistered trade marks, to the purchaser. For reasons given above (paragraph 54) however, I do not accept that the expression “Van Diemen’s Land”, as employed by the Opponent’s predecessors, constituted use as a trade mark and there is nothing to indicate that it was an “asset” as defined by the Sale Agreement. The Opponent has failed to demonstrate otherwise.

86.     As I have already found, as at the filing date of 24 November 2015, there was no evident prior use of the Trade Marks, or of “Van Diemen’s Land”, as a trade mark. Therefore any allegation that the Applicant had acted in bad faith in filing them, because it knew that the Opponent or its predecessor owned them, falls away and cannot be sustained.

87.     For all the above reasons, there is no cogent evidence before me which suggests the Applicant’s conduct in filing for registration of the Trade Marks might be said to constitute a “falling short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons” or of an “unscrupulous, underhand or unconscientious character”.[22]

[22] Fry Consulting [165-7]

88. The Opponent has not established the ground of opposition under section 62A of the Act on the balance of probabilities.

Decision

89. Section 55 of the Act relevantly provides:

Decision

(1) Unless subsection (3) applies to the proceedings, 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.

90.      The Opponent has not established a ground of opposition.

91.     The Trade Marks may therefore proceed to registration after 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 of the Trade Marks shall not occur until either the appeal is withdrawn or a court so orders. The disposition of the applications will otherwise be in accordance with the court’s finding.

Costs

92. The Applicant has sought its costs. I see no reason to depart from the general rule that costs follow the event. As the Opponent has failed to establish a ground of opposition, in respect of trade mark number 1736692, I award costs against the Applicant under section 221 of the Act in the relevant amounts under Schedule 8 of the Trade Marks Regulations 1995 (Cth). In respect of trade mark number 1736693 I awardreduced costsagainst the Applicant under s 221 of the Act in the same manner as Hume Industries (Malaysia) Berhard v James Hardie & Coy Pty Ltd.[23]

[23] [2001] ATMO 78

Mary-Ann Cooper
Hearing Officer
Oppositions and Hearings
28 June 2018