Opposition by Decorug Holdings Pty Ltd to registration of trade mark application number 2381651 (class 27) –

[2025] ATMO 168

TRADE MARKS ACT 1995

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

Re:Opposition by Decorug Holdings Pty Ltd to registration of trade mark application number 2381651 (class 27) – rugs a million - in the name of Eric Humphries

Delegate:

Debrett Lyons

Representation:

Opponent:  Andrew Sykes of counsel, instructed by Cooper Mills Lawyers Pty Ltd

Applicant:  Self-represented

Decision:

2025 ATMO 168

Trade Marks Act 1995 (Cth) – opposition under section 52 – grounds pursued under sections 42(b), 58, 60 and 62A – s 58 established – trade mark refused registration

Background

1. This decision concerns an opposition under s 52 of the Trade Marks Act 1995 (Cth) (‘Act’) by  Decorug Holdings Pty Ltd (‘Opponent’) to registration of the trade mark the subject of application number 2381651 (‘Application’) in the name of Eric Humphries (‘Applicant’). The relevant details of the Application are as follows:

Trade Mark:

rugs a million (‘Trade Mark’)

Filing Date: 

20 August 2023

Goods:

Class 27: Bathroom rugs; Door rugs; Floor rugs; Rugs; Hallway rugs; Sheepskin floor rugs; Underlays for rugs.

(‘Goods’)

1. The Application was examined as required by s 31 of the Act and was advertised as accepted for possible registration on 21 January 2024.

2. The Opponent filed a Notice of Intention to Oppose registration of the Trade Mark on 29 January 2024, followed by a Statement of Grounds and Particulars (‘SGP’) on 6 February 2024.  The Applicant filed a Notice of Intention to Defend on 4 March 2024.

3. The Opponent filed the following evidence in support of its opposition:

   ·Declaration of Peter Ludwig Karlovic made 4 June 2024 with Annexure PLK-1

   ·Declaration of Murat Tok dated 6 June 2024 together with Annexures MT-1 to

   MT-16.

4. The Applicant filed as evidence in answer a declaration he made on 12 September 2024 with Annexures A1 to A8.

5. The Opponent filed as evidence in reply:

   ·     Declaration of Erhan Karabardak dated 27 November 2024 together with Annexures EK-

   1 to EK-2

   ·     Second Declaration of Murat Tok dated 3 December 2024 together with Annexure MK-17

   ·     Declaration of Sassan Moradi dated 4 December 2024 together with Annexure SM-1.

6. Once the period for filing evidence had ended, the parties were given an opportunity to request a hearing.  The partied both requested a hearing by way of written submissions and both filed written submissions.  

7. As a delegate of the Registrar of Trade Marks (‘Registrar’), I have decided this matter as required by s 55 of the Act. In doing so I take account of the materials referred to above.

   Grounds of opposition, onus and standard of proof

8. The SGP nominated grounds of opposition under ss 42(b), 58, 60 and 62A of the Act.

9. The Opponent bears the onus of establishing at least one of the nominated grounds of opposition.[1]  The standard of proof is the ordinary civil standard on the balance of probabilities.[2]

   [1] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58, [32] (Keane CJ, Stone and Jagot JJ).

   [2] Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133] (Besanko, Jagot

   and Edelman JJ).

   Discussion

10. The Opponent’s submissions are that it and its predecessors in title have sold rugs under the trade mark RUGS A MILLION for over 20 years.  The business started with a single store in Queensland and by 1998 had multiple stores in Queensland and Western Australia.  It then rapidly expanded and its advertising spend over the years has been in the millions.  It is said that RUGS A MILLION has been used by the Opponent for both retail services and rug goods themselves.

11. The Opponent asserts that there is no good faith explanation as to why the Applicant, who gives his address as being in Queensland (the Opponent’s home state) has made the Application other than to benefit from the long standing reputation of the Opponent’s trade mark. At the time the Application was made, registration for the Opponent’s mark (which at the time was still recorded in the name of a predecessor in title) appeared on the Register of Trade Marks. The Opponent’s submissions are that the Applicant blatantly copied the registration, down to word-for-word plagiarism of the class 27 goods description, going on to state that “apart from demonstrating clear knowledge of prior rights for the purpose of the s.62A ground of opposition, these entries also establish a s.58 ground of opposition.”

    Section 58

12. For the reasons which follow, I need only consider s 58 which relevantly provides:

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

13. In the SGP the Opponent states that

    Prior to the Priority Date the Opponent’s predecessor in title first used the trade mark RUGS A MILLION in Australia in relation to rugs.  As at the Priority Date the Applicant’s predecessor in title, Rugs-A-Million Pty Ltd, was the registrant of AU TM No. 1542670 RUGS A MILLION for “Bathroom rugs; Door rugs; Floor rugs; Rugs; Sheepskin floor rugs; Underlays for rugs” which it held on trust for the benefit of the Opponent (the Preexisting Identical Registration). As at the Priority Date the Preexisting Identical Registration was registered on the Register of Trade Marks. After the Priority Date, on 29 August 2023, the Preexisting Identical Registration was removed from the Register of Trade Marks. By reason of the above, as at the Priority Date, the Opponent was the owner of the trade mark RUGS A MILLION in relation to all goods listed in the Application. In the alternative to the preceding paragraph, by reason of the above, as at the Priority Date, Rugs-A-Million Pty Ltd was the owner of the trade mark RUGS A MILLION in relation to all goods listed in the Application.

14. The Applicant’s submissions are that prior to applying for registration of the Trade Mark, it undertook extensive investigations into any previous use of the mark and that “[a]ll investigations showed the mark was not legally in use or actively owned within Australia.”   The Applicant goes on to state that it:

    accepts there was a similar former trade mark 1542670 held by a company in liquidation and not the opponent. The applicant recognises this company as sole and only legal user of that trade mark. This trade mark expired on February 22nd 2023 months prior to application of the opposed trade mark. It was apparent that the liquidator had no interest in the trade mark any longer as all shops (retail was not covered by the mark) ceased trading in March of 2019 and all purchases of inventory had ceased even prior to entering liquidation. …  No other party has an interest in the mark.

15. The details on the Register for trade mark 1542670 show that the trade mark, rugs a million, was removed from the register, showing the status, “Not Renewed: Renewal fee not paid”.  The trade mark had originally been filed on 22 February 2013 in class 27 for “Bathroom rugs; Door rugs; Floor rugs; Rugs; Sheepskin floor rugs; Underlays for rugs”.   Renewal was due on 22 February 2023.  The owner was Rugs-A-Million Pty Ltd of 70 Bundall Rd, Bundall, QLD.

16. Section 58 requires the Opponent to establish that the trade mark relied upon is identical or substantially identical to the Trade Mark.[3] They are identical. Further, s 58 requires that the Goods are the ‘same kind of thing’ as the goods for which the trade mark relied upon by the Opponent has been used.[4]  Peter Ludwig Karlovic declares that he is a former director and shareholder of Rugs-A-Million Pty Ltd.  He was the company’s CFO between 2002 and 2007; a director of the company between 2007 and 2009; and a shareholder between 2004 and 2019.  Mr Karlovic declares that during his time as CFO and shareholder, the company “invested millions of dollars into promoting the RUGS A MILLION trade mark on TV and radio advertisements which ran for about 40 weekends per year for a period of around 20 years.”   Examples of the advertising are in evidence.  He declares that Rugs-A-Million Pty Ltd sold all of the Goods.  I find that the Goods are identical (certainly, the ‘same kind of thing’) to the goods sold by the Opponent under the Trade Mark.

    [3] Carnival Cruise Lines Inc v Sitmar Cruises Limited [1994] FCA 936, [62] (Gummow J).

    [4] Re Hicks’s Trade Mark (1897) 22 VLR 636, 640 (Holroyd J).

17. Finally, s 58 requires that a person other than the Applicant has the earlier claim to ownership of the Trade Mark. That other person (or company) need not be the Opponent or a person or entity connected with the Opponent. However, the claim to ownership must predate the Application to register the Trade Mark or any earlier use of the Trade Mark in Australia by the Applicant.[5]   I accept Mr Karlovic’s evidence that the Trade Mark was used for the Goods from 2002.  The Applicant does not provide evidence of, or make a claim to, use of the Trade Mark prior to the date of the Application. 

    [5] Settef SpA v Riv-Oland Marble Co (Vic) Pty Ltd (1987) 10 IPR 402, 413 (McGarvie J).

18. The Applicant’s submissions (and its evidence in answer) are concerned with matters such as the non-renewal of trade mark 1542670; the calculation and significance of the grace period allowing late renewal; and the unrecorded assignment of the Trade Mark from Rugs-A-Million Pty Ltd to the Opponent. For the reasons given, those issues do not detract from the s 58 argument since the claim of prior ownership is not contingent on the subsistence of registration of trade mark 1542670, nor upon proof of transfer of ownership from Rugs-A-Million Pty Ltd to the Opponent.

19. All that might be observed in conjunction with the other person’s non-renewal of the registration of the Trade Mark and Mr Karlovic’s evidence that in 2019 Rugs-A-Million Pty Ltd went into liquidation, is the insinuation in the Applicant’s submissions that the reputation of the Trade Mark has evaporated since 2019. 

20. The evidence in support includes the declaration of Murat Tok made 6 June 2024.  Mr Tok is the General Manager of the Opponent, which he describes as an Australian retailer and wholesaler of rugs, carpets, flooring, window shutters, blinds, furniture, home furnishings and related products.  The declaration includes a list of the Opponent’s stores including those branded RUGS A MILLION.  Mr Tok declares that the RUGS A MILLION stores were in existence before the date of the Application.  Sassan Moradi’s declaration states that he has been managing the Rugs A Million retail stores in South Australia since January 2020.  He declares that since at least 2022, the Opponent has operated its South Australian Rugs A Million retail stores under the Trade Mark and that all rugs offered for sale in those stores have been labelled with the Trade Mark which appears on product tags and also appears on point of sale signage.

21. Mr Tok declares that on 16 October 2023 the Opponent filed trade mark application 2396711 for ‘RUGS A MILLION’ in classes 27 and 35.  Mr Tok provided confidential sales and marketing figures for rugs, carpets and related goods sold or advertised by reference to Trade Mark for the period 1 July 2022 to 30 April 2024.  The figures are very substantial indeed, even in the period prior to the making of the Application.  I cannot see any sustainable argument that the Trade Mark was abandoned.

22. I find that the Opponent has established s 58 as a ground of opposition.

    Decision

23. Section 55 of the Act relevantly provides:

    (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.

24. The Opponent has established a ground of opposition it nominated in the SGP.  Trade mark application number 2381651 is therefore refused registration.  This refusal will be recorded one month from the date of this decision unless the Registrar of Trade Marks is served with a notice of appeal.  If an appeal is filed, the disposition of the application shall be in accordance with the Court’s order or direction.

    Costs

25. The Opponent sought costs and since it is usual for costs to follow the event, I award costs against the Applicant in accordance with s 221 of the Act, in the amounts set out in Schedule 8 of the Trade Marks Regulations 1995 (Cth).

    Debrett Lyons

    Hearing Officer

    Delegate of the Registrar of Trade Marks

    28 August 2025