Opposition by Warehousing Equipment Pty Ltd to registration of trade mark application number 1975567 (12) - X-CART with device - in the name of Troden Equipment Pty Ltd

[2021] ATMO 43

TRADE MARKS ACT 1995

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

Re:Opposition by Warehousing Equipment Pty Ltd to registration of trade mark application number 1975567 (12) - X-CART with device - in the name of Troden Equipment Pty Ltd

Delegate:	Louise Tuohy
Representation:	Opponent: Marcus Fleming of Counsel, instructed by Epiphany Law Pty Ltd Applicant: Hamish Bevan of Counsel, instructed by Colin Biggers & Paisley Lawyers
Decision:	2021 ATMO 43 Trade Marks Act 1995 (Cth) – opposition under section 52 – grounds pursued under ss 42(b), 44, 60 and 62A – none established – trade mark to proceed to Registration.

Background

1. This is an opposition bought by Warehousing Equipment Pty Ltd (‘Opponent’) under s 52 of the Trade Marks Act 1995 (‘Act’) to the registration of trade mark application 1975567 (‘Trade Mark’) in the name of Troden Equipment Pty Ltd (‘Applicant’). The relevant details of the Trade Mark are set out below:

Trade Mark:      

Application Number:  1975567

Filing Date:                14 December 2018

Specification:             Class 12: Apparatus in the nature of trolleys; Apparatus in the nature of trolleys for the transportation of children; Apparatus in the nature of trolleys for transporting goods; Casters (wheels) for trolleys; Cleaning trolleys; Distribution trolleys; Hand propelled trolleys; Mail trolleys; Shopping trolleys; Storage trolleys; Tool trolleys; Trolleys; Trolleys (mobile carts); Trolleys for clearing dishes; Trolleys for clearing glasses; Trolleys for use in clearing cutlery; Trolleys for use in restaurants; Trolleys with trays; Trolleys with tubs (‘Goods’) 

2. The Trade Mark application was examined as required by s 31 of the Act and its acceptance for possible registration was advertised in the Australian Official Journal of Trade Marks on 30 June 2019.

3.     The Opponent filed a Notice of Intention to Oppose the registration of the Trade Mark on 16 July 2019. On 2 August 2019, the Opponent filed its Statement of Grounds and Particulars (‘SGP’), completing the Notices of Opposition. A Notice of Intention to Defend the Trade Mark from opposition was filed by the Applicant on 24 September 2019.

4.     Thereafter the Opponent and Applicant filed evidence in accordance with the provisions of the Trade Marks Regulations 1995 (‘Regulations’).

5.     Once the time allowed for filing evidence had ended both parties requested to be heard. As a delegate of the Registrar of Trade Marks, I heard the matter on 21 April 2021. Marcus Fleming of Counsel instructed by Epiphany Law Pty Ltd, appeared for the Opponent. Hamish Bevan of Counsel instructed by Colin Biggers & Paisley Lawyers, appeared for the Applicant. Oral submissions were supplemented by the parties’ written submissions filed prior to the hearing.

Grounds of Opposition, Relevant Date and Onus

6. In the SGP the Opponent nominated grounds of opposition under ss 42(b), 44, 60 and 62A of the Act.

7.     The date at which the rights of the parties are to be determined is 14 December 2018 (‘relevant date’) being both the filing and priority date of the Trade Mark.

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

[1] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58, [32].

[2] Telstra Corporation Ltd v Phone Directories Co Pty Ltd [2015] FCAFC 156, [133].

Evidence

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

·     Declaration of Regan Charles Dean Carr made on 20 November 2019, with Exhibits RC-1 to RC-24 (‘Carr 1’).

10.     The Applicant filed the following evidence in answer:

·     Declaration of Lauren Jane Millar made on 24 February 2020, with Exhibits LJM-1 to LJM-7 (‘Millar 1’); and

·     Declaration of Christopher Luke Hartcher made on 25 February 2020, with Exhibits CLH-1 to CLH-10 (‘Hartcher’).

11.     The Opponent filed the following evidence in reply:

·     Declaration of Regan Charles Dean Carr made on 4 May 2020, with Exhibits RC-1 to RC-2 (‘Carr 2’); and

·     Declaration of Regan Charles Dean Carr made on 2 August 2020, with Exhibit RC-1 (‘Carr 3’).

12. In addition to the above evidence, under s 202 of the Act, a Notice Requiring Production of a Document or Article had been issued on 9 June 2020 at the request of the Opponent. The Applicant produced the documents pertaining to that Notice by filing the following declaration:

·     Declaration of Lauren Jane Millar made on 7 July 2020, with Exhibits LJM-1 to LJM-9 (‘Millar 2’).

Preliminary issue: late filed material

·     Declaration of Regan Charles Dean Carr made on 6 April 2021, with Exhibits RC-1 to RC-9 (‘Carr 4’).

13.     On 7 April 2021, the Opponent filed additional material in support of Carr 1. The material comprised information regarding an internal restructure of the Opponent’s relevant business in around 2015. I advised the parties that I would deal with the late filed material at the hearing as a preliminary matter.

14.     In this matter, I note the Registrar is not bound by rules of evidence and may be informed on any matter as he or she reasonably believes to be appropriate,[3] providing that the parties have an adequate opportunity to put their case. At the hearing I was informed that both parties had agreed to the inclusion of the material and I provided my reasons to accept the material in evidence under reg 21.15(4) of the Regulations.

[3] Trade Marks Regulations 1995 (Cth) reg 21.15(4).

Section 44

15. Section 44(1) of the Act provides:

44  Identical etc. trade marks

(1)  Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant’s trade mark) in respect of goods (applicant’s goods) must be rejected if:

(a)  the applicant’s trade mark is substantially identical with, or deceptively similar to:

(i)  a trade mark registered by another person in respect of similar goods or closely related services; or

(ii)  a trade mark whose registration in respect of similar goods or closely related services is being sought by another person; and

(b)  the priority date for the registration of the applicant’s trade mark in respect of the applicant’s goods is not earlier than the priority date for the registration of the other trade mark in respect of the similar goods or closely related services.

[…]

16. In the SGP the Opponent particularised the s 44 ground of opposition as follows:

The Registered Clax Cart Mark [defined as Australian Trade Mark number 1647440] covers the following goods in Class 12 (collectively, the ‘Clax Cart Goods’): Carts; Four wheeled carts; Hand carts; Handling carts; Shopping carts.

The Applicant specifies the following goods in Class 12 (collectively, the ‘X-Cart Goods’):

Apparatus in the nature of trolleys; Apparatus in the nature of trolleys for the transportation of children; Apparatus in the nature of trolleys for transporting goods; Casters (wheels) for trolleys; Cleaning trolleys; Distribution trolleys; Hand propelled trolleys; Mail trolleys; Shopping trolleys; Storage trolleys; Tool trolleys; Trolleys; Trolleys (mobile carts); Trolleys for clearing dishes; Trolleys for clearing glasses; Trolleys for use in clearing cutlery; Trolleys for use in restaurants; Trolleys with trays; Trolleys with tubs

The Registered Clax Cart Mark is registered in respect of similar goods to the X-Cart Goods.

The X-Cart Mark is substantially identical with, or deceptively similar to, the Registered Clax Cart Mark.

Conduct including the Aggravating Conduct demonstrates that the members of the Troden Group, including the Applicant, adopted the X-Cart Mark for the purposes of appropriating at least part of the reputation in the Clax Cart Product, and therefore had an intention to mislead or deceive.

The priority date for the Registered Clax Cart Mark is 17 September 2014.

The priority date for the X-Cart Mark is 14 December 2018, which is later than that of the Registered Clax Cart Mark.

17. To satisfy the s 44 ground the Opponent must establish that the Trade Mark is substantially identical with, or deceptively similar to, another trade mark with an earlier priority date, in the name of a person other than the Applicant, in respect of similar goods.

18.     From the information set out in the SGP, verified on the Register of Trade Marks, the CLAX CART trade mark (registration number 1647440) is registered by a person other than the Applicant and it has a priority date earlier then 14 December 2018.

19.     The comparison of the goods is straightforward. The CLAX CART trade mark is registered for carts in class 12 and the Applicant seeks registration of the Trade Mark in relation to the same or similar goods in class 12.

20.     The respective trade marks to be compared are as follows:

Trade Mark CLAX CART trade mark

21.     The Opponent does not contend the Trade Mark is substantially identical to its trade mark. However, I will briefly note that the test for substantial identity requires that the trade marks are considered side by side while having regard to the essential features of the trade marks.[4] Where a total impression of resemblance emerges from the comparison, the trade marks will be considered substantially identical. In this case both trade marks share the word CART, however the Trade Mark is highly stylised with three arrowheads beside the letter X which has a long left leg, whereas the CLAX CART trade mark includes the invented word CLAX. I am satisfied that on a side by side comparison the trade marks do not have a total overall impression of resemblance.

[4] The Shell Company Australia Ltd v Esso Standard Oil (Australia) Limited (1963) 109 CLR 407, 414.

22. Therefore, the remaining question under s 44(1) of the Act is whether the Trade Mark is deceptively similar to the CLAX CART trade mark.

23. Section 10 of the Act defines a ‘deceptively similar’ trade mark as:

10  Definition of deceptively similar

For the purposes of this Act, a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.

24.     The concepts of ‘deceive’ and ‘cause confusion’ were explained in the New Zealand case of Pioneer Hi-Bred Co v Hyline Chicks Pty Ltd, where Richardson J said:

‘Deceived’ implies the creation of an incorrect belief or mental impression and ‘causing confusion’ may go no further than perplexing or mixing up the minds of the purchasing public. Where the deception or confusion alleged is as to the source of the goods, deceived is equivalent to being misled into thinking that goods bearing the applicant’s mark come from some other source and confused to being caused to wonder whether that might not be the case.[5]

[5] (1979) 96 RPC 410, 423.

25.     In Australian Postal Foundation Corporation v Digital Post Australia Pty Ltd it was noted that ‘the threshold for confusion is not high’.[6] Importantly confusion can be established ‘even if [the] confusion is unlikely to persist up to the point of, and contribute to, inducing sale’.[7] Also, confusion need not be a case of mistaking one trade mark for another; it can be wondering whether the trade marks, which might be readily distinguished from each other, nonetheless come from the same source.[8]

[6] Australian Postal Foundation Corporation v Digital Post Australia Pty Ltd [2013] FCAFC 153, [70].

[7] Tivo Inc v Vivo International Corporation Pty Ltd [2012] FCA 252, [105].

[8] Re John Fitton & Co Limited’s Application (1949) 66 RPC 110, 113.

26.     When considering the concept of deceptive similarity ‘the marks are to be compared both visually and aurally’[9] and all the surrounding circumstances are relevant to the consideration:

You must consider the goods to which they are to be applied. You must consider the nature and kind of customer who would be likely to buy those goods. In fact, you must consider all the surrounding circumstances; and you must further consider what is likely to happen if each of those trade marks is used in a normal way as a trade mark for the goods.[10]

[9] Optical 88 Ltd v Optical 88 Pty Ltd (No. 2) [2010] FCA 1380, [111]; see also Moroccanoil Israel Ltd v Aldi Foods Pty Ltd [2017] FCA 823, [173] per Katszmann J.

[10] Pianotist Co.’s Application (1906) 23 RPC 774, 777.

1. The approach requires an appreciation that trade marks will be imperfectly recalled, is explained in Australian Woollen Mills Ltd v F.S. Walton and Company Ltd, where Dixon and McTiernan JJ stated:

   [T]he marks ought not … to be compared side by side. An attempt should be made to estimate the effect or impression produced on the mind of potential customers by the mark or device for which the protection of an injunction is sought. The impression or recollection which is carried away and retained is necessarily the basis of any mistaken belief that the challenged mark or device is the same … The usual manner in which ordinary people behave must be the test of what confusion or deception may be expected. Potential buyers of goods are not to be credited with any high perception or habitual caution. On the other hand, exceptional carelessness or stupidity may be disregarded.[11]

   [11] (1937) 58 CLR 641, 658.

   28.     In my consideration as to whether the Trade Mark is deceptively similar to the CLAX CART trade mark, I note that the goods are likely to be sold in office supply stores, hardware stores, department stores and specialty material and safety equipment suppliers, as well as via Australian online retailers. The products in question are generally moderately priced items purchased with care and with consumers in store given the opportunity to handle the goods prior to purchase.

   29.     The Opponent submits that:

   (a)The Trade Mark is wholly contained within the CLAX CART trade mark, which gives rise to substantial oral and visual similarities;

   (b)The end of the CLAX CART trade mark is aurally very similar to the manner in which the Trade Mark is pronounced;

   (c)The X C combination in the middle of both trade marks is difficult to pronounce quickly, and comprises the dominant sound of both marks; and

   (d)Although the Trade Mark consists of a logo in slightly stylised form, the extent of stylisation is relatively minor, and does not detract from the words X-CART being the dominant element of the Trade Mark.

   30.     The Applicant submits that the trade marks are visually distinct and the Trade Mark has stylised device and word elements that interact with each other. In contrast the CLAX CART trade mark comprise two words, the first being a made up word and the second word being descriptive of the goods.

   31.     Visually, while both trade marks share the X C combination and the descriptive word CART, this is where the similarities end.

   32.     In regard to the aural similarities of the trade marks I consider they are pronounced quite differently. The letter X in the Trade Mark is pronounced /e/ followed by /ks/ and the word CART is pronounced kɑːʳt, as compared with the word CLAX which is pronounced klæks. The different emphasis placed on the beginning of the word CLAX in the CLAX CART trade mark aurally separates the trade marks even when they share the X C combination and the second word CART. Therefore, I am not satisfied that the trade marks are aurally similar.

   33.     The Opponent also submits that it is very likely that many consumers would assume the goods bearing the Trade Mark would be connected or otherwise associated with the Opponent thinking it was an extension to its product range.

   34.     Brand extension is a widespread marketing device which has been commented on by the courts.[12] In this case I believe that the word order, with the descriptive word CART as the second element in the trade marks, in addition to the striking visual difference in the Trade Mark, is unlikely to give consumers the impression they were or might be connected.

   [12] See, eg. Campomar Scoiedad, Limitada v Nike International Limited (2000) 202 CLR 45, 87-88.

   35.     The trade marks are visually and aurally different, such that there is not a ‘real tangible danger’[13] that the trade marks would be mistaken for each other or otherwise denote a common trade course.

   [13] Registrar of Trade Marks v Woolworths Ltd (1999) 93 FCR 365, [382].

   36. The Opponent has not established the ground of opposition under s 44 of the Act.

   Section 60

   37. Section 60 of the Act provides:

   60  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.

   38.     In the SGP the Opponent particularised the ground of opposition as follows:

   The Clax Cart Marks [defined in the SGP as the Clax Cart trade mark (TM 1647440) and a common law trade mark for ‘Clax Cart’] had acquired a reputation in Australia in respect of the X-Cart Goods through the substantial expenditure and efforts of the Opponent since on or about 2001.

   The Clax Cart Marks had acquired their reputations before the priority date for the X-Cart Mark (14 December 2018).

   Because of the reputations in the Clax Cart Marks, use of the X-Cart Mark in relation to the X-Cart Goods generally, and the X-Cart Product in particular, would be likely to deceive or cause confusion.

   39. To satisfy s 60 of the Act the Opponent must establish a reputation exists in another trade mark in Australia before the priority date of the Trade Mark. The Opponent must then establish that because of the reputation use of the Trade Mark in the Australian marketplace would be likely to deceive or cause confusion.

   40.     In McCormick & Co Inc v McCormick, Kenny J considered what is intended by the word ‘reputation’ as used in s 60. Her Honour had consulted the Macquarie Dictionary and on the basis of the definition provided concluded that it was ‘the recognition of the [trade mark] by the public generally’[14] and quoted with approval the following words of Lockhart J in Re ConAgra Inc v McCain Foods (Aust) Pty Ltd:

   [R]eputation within the jurisdiction may be proved by a variety of means including advertisements on television or radio, or in magazines and newspapers within the forum. It may be established by showing constant travel of people between other countries and the forum and that people within the forum, (whether residents there or persons simply visiting there from other countries) are exposed to the goods of the overseas owner…[15]

   [14] [2000] FCA 1335, [81].

   [15] [1992] FCA 159, [118].

   41.     Justice Kenny also referred to the Hugo Boss decision, where the Registrar’s delegate observed:

   [I]t is true that the assessment of the reputation of a trade mark goes far beyond mere examination of sale or turnover of goods sold under the trade mark and contemplation of the advertising and promotional figures.

   As regards a trade mark, its reputation derives both from the quantum of sales under that mark and also its esteem, or image, projected by that trade mark. The quantum sale, advertising and promotion contributes to the ‘recognition’ component of the trade mark’s reputation. The credit, image and values projected by a trade mark attaches to the ‘esteem’ component of the reputation as do the public events and other trader’s marks with which [the] owner of the trade marks in question chooses to associate the trade marks via sponsorship, cross-promotions, ‘contra deals’ and so forth.

   It follows that a trade mark used in relation to goods with comparatively low sales may have a high and strong reputation by virtue of the high credit or esteem in which it is held, or, conversely, that a trade mark which has very high sale may have a strong reputation notwithstanding the lack of esteem that attaches to it. The particular popular images, or sets of values, that attach to the trade mark are also, therefore, important parts of the reputation of the trade mark and may be as strong an association of the trade marks with the goods or services themselves. [16]

   [16] Hugo Boss AG v Jackson International Trading Co Kurt D Bruhl Gesellschaft MbH & Co KG (1999) 47 IPR 423, 436.

   42.     What constitutes a significant or substantial number of persons in the relevant market must be considered. Heerey J in Le Cordon Blue BV v Cordon Blue International Ltd (albeit in relation to paragraph 28(a) of the now superseded Trade Marks Act 1955) provided some guidance:

   What is ‘significant’ or ‘substantial’ will depend on the nature of the goods or services in question. For some highly specialised products, awareness among a few thousand persons, or even less, might be sufficient …[17]

   [17] [2000] FCA 1587.

   43.     In this matter the relevant market for cart products in class 12 are consumers requiring equipment for short distance movement of materials for private or commercial purposes.

   44.     In Carr 1 it is stated that the ‘Clax trade marks’ have been continuously used in Australia in relation to carts since January 2001. The ‘Clax trade marks’ are defined in Carr 1 as: the Clax Cart trade mark (TM 1647440); Clax Mobil (TM 1647451); and Clax (TM 1677377).  The cart goods bearing the ‘Clax trade marks’ have been sold by the Opponent directly to the public on a retail basis and on a wholesale basis through its distribution network to retail outlets.

   45.     While the Opponent has not provided its advertising expenditure figures, Carr 1 provides the following examples of its promotional activities:

   ·     Exhibit RC-4 provides a screenshot from the website archiving service Wayback Machine for the website warequip.com.au dated 23 March 2018. The archived page shows use of ‘Clax Cart’ as a trade marks in relation to carts.

   ·     Exhibit RC-5 provides screenshots from the Wayback Machine from the website claxcart.com.au dated 16 May 2014, 8 September 2015, 15 February 2017, 15 March 2018 and 12 December 2018. The archived pages show use of ‘Clax Cart’ as a trade mark in relation to carts. 

   ·     Exhibit RC-6 is an undated copy of a promotional brochure distributed by the Opponent from 2001. The brochure shows use of ‘Clax Cart’ as a trade mark in relation to carts. 

   ·     Figure 6 in Carr 1 is a screenshot from the Google Analytics Data page displaying the metrics for Google Ads campaigns purchased by the Opponent for the period 26 May 2014 to 26 May 2019. The Google Ads show use of ‘Clax Cart’ as a trade mark in relation to carts.

   46.     Confidential Exhibit RC-10 in Carr 1, details sales revenue derived in Australia for the goods sold under the ‘Clax trade marks’ for the years 2001 to 2018.

   47.     In my assessment of the evidence, there has been considerable promotion of ‘Clax Cart’ as a trade mark in Australia through the Opponent’s websites warequip.com.au and claxcart.com.au, Google Ads, and a brochure. Moreover, the sales revenue generated under the ‘Clax trade marks’ are significant.  

1. Taking all this information into account, the most generous reading of the evidence allows for a finding that the trade mark ‘Clax Cart’ had a reputation in Australia at the priority date amongst private and commercial consumers of carts.

2. Having regard to that limited reputation, I turn to whether the use of the Trade Mark would deceive or cause confusion. Whether the later in time trade mark will deceive or cause confusion is linked to how similar the respective trade marks are. In Rogers Seller & Myhill Pty Ltd v Reece Pty Ltd[18]the delegate said:

   [18] [2010] ATMO 5, [39]-[40].

   Confusion cannot arise solely from the reputation of one trade mark. There must always remain a level of similarity between the marks, whether we call it deceptive similarity or something less, and no matter how small it might be. The likelihood of confusion must depend on the reputation of the opponent’s trade mark, but have regard (amongst other factors) to the level of similarity of the goods/services and the degree of similarity of the trade marks, greater or smaller.

   What can be said then of section 60 as we now find it is that it comprehends that the trade marks under comparison might be quite dissimilar, and yet, taken in combination with the repute of the opponent’s trade mark (and possibly other factors), deception or confusion is still more likely than not. Put another way, section 60 now contemplates that an opponent may prevail because of the reputation in the mark on which it relies notwithstanding that the trade marks under comparison may even be quite dissimilar.

3. In Coca Cola Company v All-Fect Distributors Ltd[19] Kitto J explained that there is no limit on the nature of the confusion and it is enough that the minds of the public are mixed up or perplexed about the relationship between the trade marks.

   [19] (1999) 96 FCR 107, 121-2 [39].

4. In this matter, the goods being carts, are not inexpensive items and would be purchased after due consideration. Combined with the limited reputation demonstrated and reasons already outlined in my discussion of s 44 regarding the lack of similarity between the respective trade marks, I am not satisfied that deception or confusion is likely to occur in the marketplace even if the Trade Mark was used in relation to the same goods and directed to the same customers.

   52. The Opponent has not established the ground of opposition under s 60 of the Act.

   Section 42(b)

   53. Section 42(b) of the Act provides:

   42 Trade Mark scandalous or its use contrary to law

   An application for the registration of a trade mark must be rejected if:

   [ …]

   (b)  its use would be contrary to law.

   54.     In the SGP the Opponent particularised the ground of opposition as follows:

   As a result of the extensive time and expenditure of the Opponent, the Clax Cart Product has acquired a substantial reputation in Australia.

   By using the X-Cart Mark in relation to the X-Cart Product, the Applicant represents that:

   a. the X-Cart Product is the Clax Cart Product;
   b. the X-Cart Product is connected, associated or otherwise affiliated with the Clax Cart Product;
   c. the X-Cart Product is a product of the Opponent or Rauschenberger or both of them;
   d. the X-Cart Product is approved or sponsored by the Opponent or Rauschenberger or both of them; and
   e. the Applicant is sponsored by, approved by, connected or affiliated with, the Opponent or Rauschenberger or both of them; (collectively, the Representations).

   Each of the Representations are made in trade or commerce and are false, misleading and deceptive in that:

   a. the X-Cart Product is not the Clax Cart Product;
   b. the X-Cart Product is not connected, associated, or affiliated with the Clax Cart Product;
   c. the X-Cart Product is not a product of the Opponent or Rauschenberger;
   d. the X-Cart Product is not approved or sponsored by the Opponent or Rauschenberger; and e. the Applicant is not sponsored or approved by, or connected or affiliated with, the Opponent or Rauschenberger.

   It can be inferred from the Aggravating Conduct that the Applicant intends to mislead or deceive by using the X-Cart Mark as it has done.

   By reason of the matters set out in paragraphs 10 to 13, the Applicant has: a. in trade or commerce, engaged in conduct that was misleading and deceptive, and likely to mislead or deceive, in contravention of section 18 of the Australian Consumer Law, which is Schedule 2 to the Competition and Consumer Act 2010 (Cth) (‘ACL’); and b. in trade or commerce, made false and misleading representations in contravention of sections 29(1)(g) and 29(1)(h) of the ACL.

   55. As with all the grounds of opposition, the onus of proof rests with the Opponent and in that regard the case law on section 42(b) requires it to show that use of the Trade Mark would be, rather than could or might be contrary to law.[20]

   [20] Advantage Rent a Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683.

   56. Section 18 of the Australian Consumer Law[21] (‘ACL’) is concerned with misleading or deceptive conduct, while s 29 is concerned with false and misleading representations. Case law relevant to the ACL has made it plain that s 18 imposes a more stringent test than that for deception or confusion under s 60 of the Act.[22] In this matter, I have found that the Opponent has failed to establish a ground of opposition under s 60. Consequently, I find that the Opponent has also failed to establish that use of the Trade Mark would be contrary to s 18 of the ACL.

   [21] Schedule 2 to the Competition and Consumer Act 2010 (Cth).

   [22] Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191, 198. This case was decided under the superseded s 52 Trade Practices Act 1974 (Cth) (‘TPA’) the equivalent provision to the current s 18 of the ACL.

5. In relation to s 29 of the ACL it has been held that where a trade mark does not offend s 18 of the ACL, neither will it offend s 29 of the ACL[23] nor will it constitutepassing off.[24]

   [23] In Pacific Publications Pty Ltd v IPC Media Pty Ltd [2003] FCA 104, Beaumont J considered – in connection with the superseded TPA that ‘the Court’s conclusion on section 52 would necessarily carry with it a conclusion on section 53 (c) and (d).’ Sections 53(c)-(d) of the TPA are the equivalent provisions to ss 29(1)(g)-(h) of the ACL.

   [24] Re Equity Access Pty Ltd v Westpac Banking Corporation [1989] FCA 506, [39].

   58. The Opponent has not established the ground of opposition under s 42(b) of the Act.

   Section 62A

   59. Section 62A of the Act provides:

   62A  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.

   60.     In the SGP the Opponent particularised the ground of opposition as follows:

   It is clear from conduct such as the Aggravating Conduct that members of the Troden Group:

   a. had knowledge of the Clax Cart Product and Clax Cart Word Mark since at least 2013, when purchasing the product from the Opponent;
   b. deliberately sought to damage the goodwill in the X-Cart Marks by promoting and selling the Fake Clax Products between at least September 2014 and March 2017, alongside the genuine Clax Cart Product.
   c. sought and obtained registration for a mark, being the Clax Trolley Word Mark, that was deceptively similar to the Clax Cart Marks in circumstances where they knew of the prior rights in the Clax Cart Marks;
   d. opposed the registration of marks by Rauschenberger and the Opponent featuring the word ‘Clax’ despite knowing of their prior rights in those marks;
   e. incorporated the Applicant in 2018 after:

   (i) withdrawing the oppositions to the registration of marks featuring the word ‘Clax’; and

   (ii) assigning the Clax Trolley Word Mark to Rauschenberger.

   The purpose of the Aggravating Conduct was to damage the goodwill in the Clax Cart Products and the Clax Cart Marks, and to undermine the legal rights of the legitimate owners of the goodwill and trade marks (the 'Improper Purpose').

   Due to its relationships with the other members of the Troden Group, the Applicant had knowledge of the Clax Cart Product and the Clax Cart Word Mark, along with all Aggravating Conduct which took place before the Applicant’s incorporation on 5 June 2018.

   It is also clear that the Applicant has actively contributed to the Aggravating Conduct since its incorporation in order to carry out the Improper Purpose. It has done this by:

   a. arranging for a near replica of the Clax Cart Product to be manufactured (i.e. the X-Cart Product);
   b. applying the X-Cart Mark, to the X-Cart Product;
   c. promoting and selling the X-Cart Product under and by reference to the X-Cart Mark for the purpose of appropriating at least part of the goodwill associated with the Clax Cart Products and Clax Cart Marks; and

   d. applying to register the X-Cart Mark as a trade mark.

   Such conduct falls short of acceptable commercial behaviour, and therefore the Application was made in bad faith.

6. The Explanatory Memorandum to the Trade Marks Amendment Bill 2006 (Cth) provided some illustrations 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; and

   ·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.

7. These illustrations are not exhaustive. Bennett J in DC Comics v Cheqout Pty Ltd observed that all of the circumstances surrounding the application to register a trade mark are relevant.[25] Moreover, conduct after the filing date can be used to shed light on the Applicant’s subjective intent at the filing date.[26] 

   [25] [2013] FCA 478 [62].

   [26] Ibid [71].

8. In Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) 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.[27]

   [27] [2012] FCA 81, [147], quoting, Harrison’s Trade Mark Application [2004] EWCA Civ 1028.

9. Her Honour also considered:

   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.[28]

   [28] Ibid [165]-[166].

   65.     In this matter, the Opponent asserts that the application to register the Trade Mark was made in bad faith to damage the goodwill of the cart product and trade mark ‘Clax Cart’, and to undermine the legal rights of the legitimate owners.

   66.     It is clear from the evidence that at the time that the Trade Mark application was filed, the cart product and the trade mark ‘Clax Cart’ were present in the Australian market. The Applicant does not in its evidence or submissions deny being aware of the cart product or the trade mark ‘Clax Cart’.

   67.     In relation to the ‘aggravating conduct’ listed by the Opponent in the SGP,  Millar 1 acknowledges that: there was a dispute concerning an opposition by Troden Industries Pty Limited and Daniel Ovenden to Rauschenberger Innovations GmbH’s application for the trade mark Clax; an opposed non-use removal application by  Rauschenberger Innovations GmbH for the removal of trade mark registration 1629907 in the name of Troden Industries Pty Ltd; and the dispute as ‘to the rights of ownership of the Clax brand in Australia’ and the ‘right of any of MHA Industries Pty Ltd, Troden Industries Pty Limited and Daniel Ovenden to use Clax, Clax Trolley’s’ or similar trade marks.[29]

   [29] Millar 1 [11], and Exhibit LHM-7.

   68.     However, the dispute was ended by Deed of Settlement, the performance of the substantive obligations under it and the parties’ mutual releases.[30] Neither the Opponent nor the Applicant were parties to the above dispute. Although Troden Industries Pty Ltd was a party to the past dispute and has common owners and directors to the Applicant, Troden Industries Pty Ltd is not related to the Applicant.

   [30] Applicants written submission [14]; Millar 1 [11], [Exhibit LHM-7].

   69.     In the SGP the Opponent states that the Applicant’s actions to produce a near replica of its cart and applying the Trade Mark to the resulting product undermines the legal rights of the legitimate owners of the goodwill and ‘Clax Cart trade marks’.

   70. In response Exhibit CH-6 in Hartcher provides copies of searches from the Australian Patent Search database AusPat and the Australian Designs Search database showing ‘nil’ results for the Opponent or the Rauschenberger Innovations GmbH trolley design. On this point it is important to note that in cases decided under the s 18 of the ACL (and s 52 of the TPA) where a manufacturer exercises its freedom to make goods according to a design which is not protected by a valid registration and labels its goods in accordance with the practice of the trade (in this case with the trade mark appearing on the extended arm of the trolley) and the label clearly distinguishes the product there is no misleading or deceptive get-up.[31]

   [31] Parkdale Custom Built Furniture Pty Ltd  v Puxu Pty Ltd (1982) 149 CLR 191, 225-226.

   71.     In Carr 1, Figure 12 reproduced below provides a side by side comparison of the trolley products sold by the parties which shows the respective trolleys labelled with their trade marks on the steering arm:

   The Clax Cart  The X-Cart

   72.     A further example of how the Applicant distinguishes its Goods is shown in Exhibit CLH-2 of Hartcher which provides a copy of the Applicant’s packaging:

   73.     In addition, Millar 2 provides the steps taken by the Applicant to name its product. Millar states that the name X-CART was selected after a competition among staff members in the last quarter of 2018.[32] Further, the Applicant states that the logo was developed in a competitive process of graphic designers from around the world using the “Freelancer’ application in response to a design brief.[33] The Trade Mark was selected because the X reflected the elongated arm of the trolley and the three arrowheads allude to its collapsibility.[34]

   [32] Millar 2 [3]-[5], [Exhibit LJM-3].

   [33] Millar 2 [7], [Exhibit LJM-7].

   [34] Millar 1 [7], {Exhibit LJM-4].

   74. The s 62A ground is particularised by the reference to the Applicant being aware of the cart product and the trade mark ‘Clax Cart’ at the time it filed to register the Trade Mark. However, on the basis of the evidence before me I am not satisfied that mere awareness of the cart product and trade mark ‘Clax Cart’ is a sufficient basis to find that the application to register the Trade Mark was made in bad faith.[35]

   [35] 1872 Holdings VOF v Havana Club Holding SA (2017) 127 IPR 410, 427 [64].

   75.     The act of producing a near replica of the Opponent’s cart product and applying the Trade Mark to that product does not undermine the legal rights of the legitimate owners of the goodwill and ‘Clax Cart trade marks’. This is manifest in circumstances where the Applicant had organised a competition to name its trolley product and design its logo, with the winning name and logo then applied to a product that is not protected by a valid design or patent registration in accordance with the practice of the trade.  

   76. The Opponent has not established the ground of opposition under s 62A of the Act.

   Decision

   77.  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.

10. The Opponent has failed to establish any of the grounds of opposition it nominated in the SGP. Trade Mark 1975567 may proceed to registration not less than one month from the date of this decision. If the Registrar has been served with a notice of appeal before this time, I direct that registration shall not occur until either the appeal is withdrawn or discontinued. Otherwise, the disposition of the application should be in accordance with the Courts order or direction.

    Costs

11. Both parties sought an award of costs. It is usual for costs to follow the event, and I see no reason to depart from that principle here. I award costs against the Opponent in terms of schedule 8 of the Regulations.

    Louise Tuohy
    Hearing Officer
    Delegate of the Registrar of Trade Marks
    26 May 2021