Mr Car Keys Pty Ltd v Paul John Jones

[2019] ATMO 33

TRADE MARKS ACT 1995

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

Re:Opposition by Mr Car Keys Pty Ltd to registration of trade mark application 1789310 (9, 40) - MR AUTO KEYS and Device - in the name of Paul John Jones.

Delegate:	Iain Campbell Thompson
Representation:	Opponent: IP Wealth Pty Ltd Applicant: Hazan Hollander
Decision:	2019 ATMO 33 Trade Marks Act 1995 Section 52 opposition - section 62A – application made in bad faith – ground established. Registration refused

Background

1. In these proceedings under section 52 of the Trade Marks Act 1995 (‘the Act’) Paul John Jones (‘the Applicant’) has applied to register the trade mark which appears below:

   Application No:         1789310

   Priority Date:             11 Aug 2016

   Goods/Services:         Class 9: Encoded keys; Encoded keys for central locking in vehicles; Encoded keys for starting vehicles

   Class 40: Cutting of replacement keys

   Trade Mark:               

   (‘the Trade Mark’)

2. The Trade Mark was examined as is required by section 31 of the Act and advertised as accepted for possible registration in the Australian Official Journal of Trade Marks on 12 January 2017.

3. On 13 March 2017, Mr Car Keys Pty Ltd filed a Notice of Intention to Oppose the registration of the Trade Mark followed, on 12 April 2017, by a Statement of Grounds and Particulars which details grounds under sections 44, 58, 60, 42, 59, 62A, and 62 of the Act.

4. On 17 May 2017, the Applicant filed a Notice of Intention to Defend.

5. Thereafter, on 24 August 2017, the Opponent filed its Evidence in Support being a declaration made by Bradley Staines, owner and founder of Mr Car Keys Pty Ltd trading as MR CAR KEYS, made on 24 August 2017, with exhibits BS-1 to BS-28.

6. The Applicant has not filed Evidence in Answer.

7. The parties have subsequently been advised of their right to be heard or to make written submissions.  Neither party has requested to be heard and have elected to make written submissions – the Opponent’s submissions are by its attorneys, IP Wealth Pty Ltd and the Applicant’s submissions are by its attorneys Hazan Hollander.

   Onus and Relevant Date

8. The Opponent bears the onus of establishing a ground of opposition which is detailed in the Statement of Grounds and Particulars on the balance of probabilities.[1]

   [1] Pfizer Products Inc v Karam [2006] FCA 1663; 237 ALR 787; (2006) 70 IPR 599; [2006] AIPC 92-146 per Gyles J at [6] to [26]; Telstra Corporation Ltd v Phone Directories Co Pty Ltd [2015] FCAFC 156 at [132] to [133].

9. The relevant date (‘the Relevant Date’) at which the grounds must be considered is the filing date[2] of the opposed application.

   [2] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd [1953] HCA 73; (1954) 91 CLR 592.

   Other

10. This matter is closely related to other proceedings before the Registrar which are subject to the decision in Mr Car Keys Pty Ltd v Paul John Jones[3] (‘Mr Car Keys’) involving the same parties, similar Evidence in Support,[4] the same grounds, and similar submissions.  I have read, and agree with, the delegate’s decision and will adopt his discussion of the evidence and some of his reasoning.

    [3] [2018] ATMO 52.

    [4] There was also Evidence in Answer before the Registrar’s delegate that is not present here.

    Evidence

11. In Mr Car Keys the delegate observed:

    According to the Staines declaration, the Opponent is a specialised automotive locksmith operation that supplies, cuts and programs keys for almost all makes and models of automobile. The Opponent asserts it has been using the trade mark MR CAR KEYS (‘the Opponent’s Trade Mark’) since November 2009 in connection with the following goods and services:

    · Class 6: Keys

    · Class 9: Encoded key cards; Encoded keys; Encoded keys for central locking in vehicles; Encoded keys for starting vehicles

    · Class 40: Cutting of replacement keys; Key cutting; Key duplicating

    The Opponent applied to register its trade mark in respect of the above goods and services on 2 February 2016.

    Relationship between the parties

12. In his declaration in this matter Mr Staines asserts:

    An employee from Scanner Auto in Greenacre, New South Wales recommended the Opponent’s Goods and Services to the Applicant.

    The Applicant first contacted the Opponent on 22 October 2015 to employ the Opponent’s Goods and Services. From October 2015 through to December 2015 the Applicant and I, on behalf of the Opponent, communicated through a series of text messages and phone calls in which the Applicant engaged the Opponent’s Goods and Services.

    I refer you to EXHIBIT BS-21 attached and forming part of this Declaration, containing images of the text messages and missed calls from the Applicant as well as invoices for the work provided to the Applicant.

    The mobile number used by the Applicant during their phone calls and text messages is the same mobile number used by the Applicant on their new business under the Opposed Application.

    I refer you to EXHIBIT BS-22 attached and forming part of this Declaration, containing a screenshot from the Applicant’s contact details located at (the “Applicant’s Domain”) and the AusRegistry extract showing the Applicant is the owner of the Applicant’s Domain.

    At all times the Applicant identified their business as being called “AUTOSCAN” and the Applicant was aware of the Opponent’s Mark.

    I refer you to EXHIBIT BS-23 attached and forming part of this Declaration, containing:

    (a) The first text message from the Applicant, dated 22 October 2015;

    (b) Invoice 2547 dated 27 October 2015, was for Goods which the Applicant collected in person from the Opponent’s Physical Premises;

    (c) Invoice 2593 dated 3 November 2015, which was for Goods posted to the Applicant’s home address;

    (d) Invoice 2922, which was paid on 1 February 2016 was for a variety of Goods that were ordered separately through November and December and were invoiced together in February. The first four items on the invoice were delivered to the Applicant’s home address by the Opponent’s employee Peter Gee and received by his wife. The remaining two items were picked up by the Applicant from the Opponent’s Physical Premises.

    On at least one occasion, a staff member from the Opponent was required to travel to the Applicant’s personal address to fulfil an order. The staff member drove one of the vehicles referred to in paragraph 31 above and wore the uniform referred to in paragraph 33 above and shown in the respective Exhibits.

    Between 22 October 2015 and 22 December 2015 I discussed with the Applicant the Opponent’s plans to expand into the area of the Central Coast, New South Wales. I discussed with the Applicant the possibility of him joining the Opponent as a franchise. The Applicant was very interested in this proposal and indicated that as long as he could convince his wife that it would be profitable he was prepared to work out an agreement. The Applicant indicated during these conversations his intention to bring his wife to the Physical Premises to convince her of the legitimacy of our business and his plan to join us as a franchisee.

    On 22 December 2015, the Applicant visited the Physical Premises with his wife to discuss the potential franchise. The Applicant advised me that he was ready to proceed with the franchise agreement and that after the Christmas / New Year period had passed he would contact me so he could get started.

    On 22 December 2015, the Applicant’s closing remarks to me was that he would return to the Physical Premises to see me in the New Year so we could finalise the details of getting him started as “MR CAR KEYS” on the central coast.

    On 29 January 2016, the Opponent became aware of the Applicant’s Domain and immediately emailed the Applicant regarding the domain.

    I refer you to EXHIBIT BS-24 attached and forming part of this Declaration, containing:

    (a) An email dated 29 January 2016 from myself, on behalf of the Opponent, addressed to the Applicant regarding the matters referred to in paragraphs 50 through to 57 above; and

    (b) An email dated 30 January 2016 from the Applicant in response and confirming the matters referred to in [the above] paragraphs.

13. The exhibits to Mr Staines’s declaration support the above assertions as well as use by the Opponent of the trade marks which appear below:

    (‘Invoice’)

    (‘Yellow Pages’)

    (‘Motor Vehicle’)

14. I note that the words “Mr Car Keys” are prominent within the Opponent’s logos in the above; I further note that in terms of Mantra Group Pty Ltd v Tailly Pty Ltd (No 2)[5] (‘Mantra’) the prominent uses of the domain name on the Motor Vehicle and Yellow Pages will themselves qualify as a use of the trade mark MR CAR KEYS.  In Mantra, Reeves J observed:

    It has been doubted whether the mere registration of a domain name containing the words of a trade mark constitutes the use of those words as a trade mark for the purposes of s 120 of the Trade Marks Act: see CSR Ltd v Resource Capital Australia Pty Ltd [2003] FCA 279; (2003) 128 FCR 408 (“CSR Ltd”) at [42] per Hill J and the cases referred to. However, if the registered domain name is linked to a website that contains advertising material that promotes goods or services in relation to which the trade mark is registered, this combination of use could constitute use as a trade mark under s 120 of the Trade Marks Act.

    [5] [2010] FCA 291; (2010) 183 FCR 450; (2010) 267 ALR 347; (2010) 86 IPR 19; (2010) 51 AAR 458; [2010] AIPC 92-376 at [50].

15. See also the observation of Reeves J in Accor Australia & New Zealand Hospitality Pty Ltd v Liv Pty Ltd:[6]

    I consider this is trade mark use of those signs or words. That is so because this use of a domain name to redirect potential customers to a website displaying one’s goods and services is analogous to using those words as a sign on the front of a shop to indicate the goods and services that are sold within.

    [6] [2015] FCA 554 at [83].

16. Here the Opponent has such a website.

    Section 62A

    Statement of Grounds and Particulars

17. In the Statement of Grounds and Particulars the Opponent asserts:

    1.   The Opponent has been using the Prior Mark since December 2009 in relation to the Goods and Services.

    2.   The Applicant contacted the Opponent on, or about, 22 October 2015 in order to purchase and utilise the Goods and Services provided by the Opponent under the Prior Mark.

    3.   At this time, the Applicant was operating under the name “AUTOSCAN”, and had been operating as “AUTOSCAN” for at least five years.

    4.   Between October 2015 and December 2015, the Applicant utilised the Opponent’s Goods and Services, purchased goods from the Opponent and visited the Opponent’s premises.

    5.   Between October 2015 and December 2015 the Opponent advised the Applicant of their intention to expand and open new stores and franchisees.

    6.   Between October 2015 and December 2015, the Applicant and Opponent entered into discussions whereby the Applicant was offered the opportunity to become a franchisee of the Opponent.

    7.   Between October 2015 and December 2015, the Applicant and Opponent communicated via phone calls, text messages, SMS messages and emails.

    8.   At all times, the Applicant actively discussed joining the Opponent as a franchisee and indicated a positive intention towards accepting the business proposal.

    Section 62A - Framework

18. Section 62A of the Act provides:

    62AApplication made in bad faith

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

19. In Mr Car Keys, at [15], the delegate explained:

    The Explanatory Memorandum to the Trade Marks Amendment Bill 2006 provided some non-exhaustive examples of applications made in bad faith:

    ◦persons who monitor new property developments, register the names of new developments as trade marks for a number of services and then threaten the property developers with trade mark infringement proceedings unless the developers licence or buy the trade marks;

    ◦persons who have a history of applying for trade marks that are deliberate misspellings of other registered trade marks;

    ◦persons who identify trade marks used overseas but with no Australian use as yet who then apply to register the trade marks in Australia for the express purpose of selling them to the overseas owners.

    The case of Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2)[7] is a current leading Australian authority on this section of the Act. In that case, Dodds-Streeton J made the following comments:

    Clearly the court, when considering bad faith, cannot apply a purely subjective test, called by Lord Hutton ‘the Robin Hood test’. The dishonest person or one with low standards cannot be permitted to obtain trade mark registrations in circumstances where a person abiding by a reasonable standard would not. The registration of a trade mark is designed to enable bona fide proprietors to protect their proprietary rights without having to prove unfair trading. Registration is not provided to help those with low moral standards. ...

    The words ‘bad faith’ suggest a mental state. Clearly when considering the question of whether an application to register is made in bad faith all the circumstances will be relevant. However the court must decide whether the knowledge of the applicant was such that his decision to apply for registration would be regarded as in bad faith by persons adopting proper standards.

    Her Honour continued later[8] in the same decision:

    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.

    [7] [2012] FCA 81, at [24]-[26].

    [8] Ibid [165]-[166].

20. After some discussion of the evidence of the Applicant’s attendance at the Opponent’s premises and exposure to the Opponent’s trade marks thereon and on invoices, and discussions about a possible franchise agreement (as well as application of the principles outlined above), the delegate concluded that the Opponent had established its ground of opposition under section 62A.

21. The Applicant’s submissions which may distinguish the circumstances before me from those in Mr Car Key are as follows:

    In any event, to establish bad faith, the Opponent must prove that the Opposed Logo is deceptively similar to a trade mark. The Opponent asserts that trade mark to be the Opponent’s Word Mark.

22. I do not concur that there is a general principle that an opponent must establish under section 62A that the impugned trade mark is, as a minimum, deceptively similar to a trade mark used by that opponent. To take a hypothetical example, Wombat Explosives Pty Ltd uses the trade mark SUPER BANG on its goods and an ex-employee (or potential franchisee) registers the company name Super Bang Pty Ltd and seeks to register the trade mark WOMBAT EXPLOSIVES. The putative trade mark WOMBAT EXPLOSIVES has arguably never been used as a trade mark by the postulated opponent but only as a company name and yet there is a strong prima facie case of “bad faith”.

23. Moreover, I am satisfied that here the trade marks here under consideration (MR CAR KEYS Logo and the Trade Mark) are, according to the usual tests,[9] deceptively similar.  In my consideration the trade marks of the parties will be known and identified by the dominant expressions within them – MR CAR KEYS and MR AUTO KEYS – and that these expressions are likely to be confused with each other.  This is a fortiori true of the Opponent’s domain name when used as a trade mark, as discussed above.

    [9] Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd [1963] HCA 66; (1963) 109 CLR 407; [1962] ALR 304; 1B IPR 523; 35 ALJR 355 at [13].

24. I agree with the words of the delegate in Mr Car Keys:

    I am satisfied that at the Relevant Date the Applicant was aware of the Opponent’s trade marks as a result of its exposure to those trade marks on invoices and by attendance at the Opponent’s premises. I am satisfied, too, that the Applicant was aware that the Opponent was the owner of those trade marks. The application by the Applicant to register a trade mark which is deceptively similar to the Opponent’s trade marks for the Applicant’s Goods and Services, in the circumstances of this case, is likely to be seen as in bad faith by persons adopting proper standards. The Opponent has therefore established this ground of opposition.

25. I further note that it is common ground that the possibility of the Applicant operating a franchise under the Opponent’s trade marks had been discussed between the parties prior to the Relevant Date.

26. The Opponent has established its opposition under section 62A.

    Decision

27. Section 55 of the Act relevantly states:

    55Decision

    (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.

28. I refuse to register application 1789310.

    Costs

29. Both parties sought an award of costs if successful in these proceedings. As the Opponent has been successful, as provided for by section 221 of the Act, I award costs against the Applicant at the official scale set out in Schedule 8 to the Trade Marks Regulations 1995.

    Iain Campbell Thompson
    Hearing Officer
    Trade Marks Hearings
    7 March 2019