Opposition by EastBridge Co Ltd to registration of trade mark application number 2055861 (classes 3, 35, 44) – MEDIV FOR BEAUTY AND HEALTH - in the name of Xue Gao

[2022] ATMO 39

TRADE MARKS ACT 1995

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

Re:Opposition by EastBridge Co Ltd to registration of trade mark application number 2055861 (classes 3, 35, 44) – MEDIV FOR BEAUTY AND HEALTH - in the name of Xue Gao

Delegate:	Katrina Brown
Representation:	Opponent: Herbert Smith Freehills Applicant: AUGE Accounting Pty Ltd
Decision:	2022 ATMO 39 Trade Marks Act 1995 (Cth) – opposition under section 52 – grounds pursued under ss 42(b), 58 and 62A – s 62A established – registration of trade mark refused.

Background

1. This decision is in respect of an opposition under s 52 of the Trade Marks Act 1995 (Cth) (‘Act’) by EastBridge Co Ltd (‘Opponent’) to registration of the following trade mark.

   Trade Mark No:                   2055861         
   
   Trade Mark:  

   (‘Trade Mark’)

   Applicant:  Xue Gao (‘Applicant’)

   Filing Date:      10 December 2019

   Specification:  Class 3: Beauty care preparations; Beauty care products; Beauty creams (non-medicated); Beauty face packs; Beauty gels; Beauty masks; Beauty milks; Beauty preparations; Beauty products; Distilled oils for beauty care; Non-medicated beauty preparations; Non-medicated skin care beauty products; Products for beauty care; Cleansing facial masks; Facial care products (cosmetic); Facial cleansers; Facial creams (cosmetic); Facial masks (cosmetic); Facial moisturisers (cosmetic); Facial oil; Facial packs (cosmetic); Facial packs for cosmetic purposes; Facial packs for toilet purposes; Facial preparations (cosmetic); Facial scrubs (cosmetic); Facial soaps; Facial toners (cosmetic); Facial washes; Facial washes (cosmetic); Facial wipes impregnated with cosmetics; Non-medicated creams for facial scrubs; Non-medicated facial lotions (cosmetic); Aromatic perfumery products; Bath products, not medicated; Body care products (non-medicated); Chemical products for bleaching (cosmetic use); Cleaning products for the skin; Cleansing products for the eyebrows; Cleansing products for the eyelashes; Cleansing products for the eyes; Cosmetic products for eyebrows; Cosmetic products for eyelashes; Hair care products; Hair products; Make-up products

   Class 35: Career information and advisory services (other than educational and training advice); Career advisory services (other than education and training advice); Advertising; Rental of advertising space on the internet; Advertising services provided over the internet; Compilation of advertisements for use as web pages on the internet; Compilation of directories for publishing on the Internet; Rental of advertising space; Association services being the promotion of the interests of members of the association; Business promotion services; Chamber of commerce services for the promotion of businesses; Chamber of commerce services for the promotion of commerce; Chamber of commerce services for the promotion of trade; Concert promotions (for others); Consultancy relating to business promotion; Consultancy relating to sales promotions; Demonstration of goods for promotional purposes; Online promotion on a computer network; Organisation of fashion shows for promotional purposes; Organisation of housing and real estate displays and exhibitions for promotion or advertising purposes; Production, organisation and presentation of fashion shows for advertising or promotional purposes; Promotion (advertising) of business; Promotion of fairs for trade purposes; Promotional marketing; Promotional services; Sales promotion (for others); Sales promotion services; Sales promotions through customer loyalty programmes (for others); Search engine optimisation for sales promotion; Sponsorship (promotion and marketing services); Trade promotional services; Business advisory services relating to product development; Commercial information and advice for consumers in the choice of products and services; Product launch services; Product marketing; Product sampling; Production of home shopping programmes (production of advertisements and commercials); Advertising agency services; Advisory services for business management; Advisory services relating to advertising; Advisory services relating to customer service; Advertisement hoarding rental; Placing of advertisements; Preparation of advertisements; Preparing of advertisements; Production of radio advertisements; Production of radio television and cinema advertisements

   Class 44: Advisory services relating to beauty treatment; Beauty care services; Beauty consultancy; Beauty consultation; Beauty counselling; Beauty salon services; Beauty salons; Beauty treatment services; Consultancy relating to beauty; Consultancy relating to beauty care; Consultancy services relating to personal appearance (hair, beauty, cosmetics); Health spas (health, hygiene and beauty care services); Hygienic and beauty care for animals; Hygienic and beauty care for human beings; Personal care services (medical nursing, health, hygiene and beauty care); Providing information, including online, about hygienic and beauty care for human beings or animals; Advisory services relating to pharmaceutical products

   (‘Applicant’s Goods and Services’)

2. The trade mark application was examined as required by s 31 of the Act. Acceptance of the Trade Mark was advertised in the Australian Official Journal of Trade Marks on 11 May 2020.

3. The Opponent filed a Notice of Intention to Oppose on 9 July 2020, followed by a Statement of Grounds and Particulars (‘SGP’) on 10 August 2020.

4. The Applicant filed a Notice of Intention to Defend on 16 October 2020.

5. The Opponent filed the following declaration as evidence in this matter:

   ·Declaration of Lee TaeGyu (President of Opponent) made on 4 February 2021 with Exhibits LT-1 to LT-18 (‘LT Declaration’).

6. The Applicant did not file any evidence.

7. Once the time allowed for filing evidence ended, the Opponent requested a hearing by written submissions. Neither party filed written submissions.

8. The matter has been allocated to me, a delegate of the Registrar of Trade Marks, to decide based on the material described in [3] to [5] of this decision.

   Grounds of opposition and onus

9. In the SGP, the Opponent nominated grounds of opposition under ss 42(b), 58 and 62A of the Act.

10. The Opponent bears the onus of establishing at least one of the grounds of opposition.[1] In the event that the Opponent establishes one of the grounds in relation to all the Applicant’s Goods and Services, there is no requirement for me to consider the other grounds of opposition.

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

11. The standard of proof is the ordinary civil standard of the balance of probabilities.[2]

    [2] Telstra Corporation Ltd v Phone Directories Co Pty Ltd [2015] FCAFC 156 [133] (Besanko, Jagot and Edelman JJ).

    Section 62A

12. Section 62A provides:

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

13. The phrase ‘bad faith’ is not defined in the Act. In the context of s 62A bad faith does not require dishonesty or fraud, ‘it is a wider notion, potentially applicable to diverse species of conduct’.[3] In DC Comics v Cheqout Pty Ltd (‘DC Comics’) Bennett J explained:

    Bad faith is a combined test that involves subjective and objective elements. The subjective element refers to the knowledge of the relevant person at the time of making the application. The objective element requires the decision-maker to decide whether, in the light of that knowledge, the relevant person’s behaviour fell short of acceptable commercial standards.

    The question is whether the conduct falls short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in the particular area. It is whether the knowledge of the applicant was such that the decision to apply for registration would be regarded as in bad faith by persons adopting proper standards.[4]

    [3] Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) [2012] FCA 81 [164] (Dodds-Streeton J) (‘Fry Consulting’).

    [4] [2013] FCA 478 [62] (‘DC Comics’).

14. Accordingly, I must determine what the Applicant knew at the time of making the application for the Trade Mark and then, considering that knowledge, whether it fell short of acceptable commercial behaviour and is of ‘an unscrupulous, underhand or unconscientious character’.[5]

    [5] Fry Consulting (n 3) [166] (Dodds-Streeton J).

15. In the current matter, the Applicant has not involved itself beyond filing a Notice of Intention to Defend. There may be reasons for the Applicant’s chosen path. Nonetheless, the Applicant, through its actions, has elected not to file evidence. In the absence of any evidence in answer, I accept the evidence of the Opponent.

16. The Opponent’s evidence, relevant to the ground of opposition under s 62A of the Act, is as follows:

    ·In 2016, the Opponent launched the brand ‘Mediv’ in South Korea. The brand is used in relation to skincare and cosmetic products.

    ·The declarant (the President of the Opponent) is the registered owner of the Trade Mark in South Korea, with an application date of 9 March 2016.

    ·The Applicant is the sole director and shareholder of G&X Beauty Group Pty Ltd. The Applicant also founded, or is involved with, businesses under the names GQ Beauty, GQ Beauty & Metgirls, and G & Metgirls All Skin Management and is described in published articles as ‘the head of the Australian and New Zealand market of Metgirls’. Each of the above-named businesses is located at the registered premise of G&X Beauty Group Pty Ltd in Melbourne, Australia.

    ·In March 2018, the Applicant contacted the declarant to negotiate a contract for the distribution and sale of the Opponent’s ‘Mediv’ goods in Australia. In April 2018, August 2018 and November 2018, G&X Beauty Group Pty Ltd placed orders with the Opponent for ‘Mediv’ branded skincare goods. The Opponent shipped the orders to the registered premise of G&X Beauty Group Pty Ltd.

    ·In April 2018, the Applicant’s spouse contacted the Opponent about establishing an ‘East Bridge’ office in Australia and registering the ‘Mediv’ trade mark in the company name in Australia. No agreement was reached between the Opponent and the Applicant (or the Applicant’s spouse), and the Applicant was informed that it did not have permission to establish an office of the Opponent in Australia.

    ·In October 2018, the Opponent entered into a distribution agreement with Metgirls Import and Export Trading (Guangzhou) Co. Ltd (‘Metgirls Guangzhou’). Under the agreement, Metgirls Guangzhou was authorised to sell and distribute goods bearing the ‘Mediv’ trade mark in China. The distribution agreement between the Opponent and Metgirls Guangzhou was terminated in late 2019. The Opponent sent termination notices to Metgirls Guangzhou on 28 November 2019 and 9 December 2019. Each termination notice indicates that the ‘Mediv’ brand belongs to the Opponent.

    ·On 10 December 2019, the Applicant filed the application to register the Trade Mark in Australia.

17. At the time of filing the application for the Trade Mark, the Applicant was clearly aware of the Opponent and its use of the ‘Mediv’ trade mark on skincare products. Prior to filing the application, the Applicant had a course of dealings with the Opponent. The Applicant had entered into negotiations with the Opponent to distribute and sell ‘Mediv’ products in Australia; had made three separate purchases of ‘Mediv’ products from the Opponent via G&X Beauty Group Pty Ltd and had been involved in discussions seeking to open a branch of the Opponent in Australia. It is also probable that the Applicant was aware of the termination of the distribution agreement; it seems an unlikely coincidence that the Applicant (the head of the Australian and New Zealand market of Metgirls) filed the application the day after the Opponent terminated the distribution agreement with Metgirls Guangzhou.

18. Mere awareness of the Opponent and its business, or prior dealings with the Opponent, do not automatically result in the application for the Trade Mark being made in bad faith. That approach is unduly absolute.[6] The enquiry is whether, in all the particular circumstances, the Applicant’s knowledge was such that the decision to apply for the Trade Mark would be regarded as being in bad faith by persons adopting proper standards.[7]

    [6] Fry Consulting (n 3) [167] (Dodds-Streeton J).

    [7] Ibid.

19. Aspects of the Applicant’s conduct have been recognised in decided cases as being crucial elements in a finding of bad faith. In DC Comics the Federal Court endorsed the principle that ‘it is difficult to see how a person who applies to register, in his own name, a mark he has previously recognised as the property of a potential overseas principal can be said to be acting in accordance with acceptable standards of commercial behaviour’.[8] The evidence in the current matter suggests that, prior to filing the application for the Trade Mark, the Applicant had recognised it was the property of the Opponent. In March 2018, the Applicant had negotiated a distribution contract with the Opponent and in April 2018, the Applicant was involved in discussions with the Opponent (which were initiated by the Applicant’s spouse) about establishing an EastBridge office in Australia and registering the ‘Mediv’ trade mark in the company name in Australia. In the absence of an alternative explanation from the Applicant, seeking approval from the Opponent to register the ‘Mediv’ trade mark in the name of EastBridge in Australia is recognition that the Trade Mark was the property of the Opponent.

    [8] DC Comics (n 4) [62].

20. Considering all the circumstances in the present matter including that the Applicant had prior dealings and a business relationship with the Opponent, had previously recognised the Trade Mark as the property of the Opponent and chose to file an application for the Trade Mark just 1 day after the Opponent terminated a distribution agreement with an entity associated with the Applicant, I am satisfied that at the time of filing the application for the Trade Mark, the Applicant’s conduct fell short of standards of acceptable commercial behaviour observed by reasonable and experienced persons.

21. Accordingly, the ground of opposition under s 62A of the Act has been established.

    Decision

22. Section 55 of the Act relevantly provides:

    55 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.

23. The Opponent has established the ground of opposition under s 62A of the Act. Consequently, I refuse to register trade mark number 2055861.

    Costs

24. The parties sought costs. It is usual for costs to follow the event, and I see no reason to depart from that principle. I award costs against the Applicant according to the official scale set out in Schedule 8 of the Trade Marks Regulations 1995 (Cth).

    Katrina Brown
    Hearing Officer
    Oppositions and Hearings
    Trade Marks and Designs
    21 March 2022