Paige Stainless Pty Ltd v Aco Polycrete Pty Ltd

[2011] ATMO 87

TRADE MARKS ACT 1995

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

Re:Opposition by Paige Stainless Pty Ltd to registration of trade mark application 1164611(6) - HEELGUARD - filed in the name of Aco Polycrete Pty Ltd.

Delegate:	Iain Thompson
Representation:	Opponent: Andrew Fox of Counsel instructed by Griffith Hack, Patent & Trade Mark Attorneys Applicant: Sam Park of SAMPARK & Co
Decision:	2011 ATMO 89 S52 opposition – both ss58 and 41 established. Registration refused

Background

1. This decision concerns an opposition under section 52 of the Trade Marks Act 1995 (‘the Act’) to an application for the registration of a trade mark filed by Aco Polycrete Pty Ltd (‘the applicant’) of Sydney.  Current details of the application appear below:

   Application No:           1164611
   Priority Date:               6 March 2007

   Goods:Class 6:  Grated access covers made of metal for pits, trenches, drains, underground access ways and ducts; grated manhole covers made of metal for pits, trenches, drains, underground access ways and ducts; parts and accessories in this class for all the aforementioned goods

   Trade Mark:                HEELGUARD

2. The application was examined in compliance with section 31 of the Act, accepted for possible registration and advertised as such in the Australian Official Journal of Trade Marks on 11 September 2008.  Acceptance of the trade mark was subject to the following endorsements:

   Provisions of subsection 41(5) applied.

   Provisions of subsection 44(4) and/or Reg 4.15A(5) applied.

3. On 11 December 2008, Paige Stainless Pty Ltd (‘the opponent’) filed Notice of Opposition (‘the Notice’) to the registration of the trade mark (henceforth ‘the opposed trade mark’).  The Notice includes the grounds which were subsequently argued at the hearing of the opposition before me (as a delegate of the Registrar of Trade Marks) in Sydney on 9 August 2011.

4. Mr Andrew Fox of Counsel instructed by Griffith Hack Patent & Trade Mark Attorneys represented the opponent.  Mr Sam Park of SAMPARK & Co represented the applicant.  Representatives of the parties also attended the hearing.

5. Put very briefly, Mr Fox’s argument for the opponent can be summarised as being that the evidence shows the opposed trade mark is not a trade mark (allegedly being a generic term for a particular type of drainage grating)[1] and that, if it is a trade mark, the applicant is not the owner of it.[2]

   [1] Section 41 of the Act.

   [2] Section 58 of the Act.

6. Mr Park’s submissions consisted in large part of ‘reading-in’ his client’s evidence, a substantial portion of which details dealings between and affecting the parties in their dispute concerning the opposed trade mark.  It is clear that a business relationship existed between the parties and that this has broken because of the dispute.  This dispute is not of direct relevance to my considerations in this matter.

   Outline

7. It will be convenient for me to first briefly discuss the evidence and ground under section 58 as it is very obvious that that ground must succeed and it interrelates to an extent with my conclusions to the ground under section 41. I will later discuss the ground under section 41 and the evidence which goes to it.

   The Evidence

8. The evidence in this matter is relatively substantial. Nevertheless, the grounds under which the matter was argued under sections 58 and 41 are very straightforward and I will try to confine my discussion of the evidence to that which most obviously goes to those grounds. The evidence which is not discussed in this decision is consistent with that which is discussed and in my consideration supports my decisions.

9. The evidence comprises the following declarations:

   In support

   Tara Parkes dated 15 September 2009 with Exhibits TP-1 to TP-5 (‘Parkes’)

   Daniel Rosenthal dated 2 November 2009 with Annexures DR-1 to DR-6 (‘Rosenthal’)

   Michael Richards dated 13 October 2009 with Annexures MR-1 to MR-3 (‘Richards’)

   Ken Williams dated 17 November 2009 with Annexures KW-1 to KW-3 (‘Williams 1’)

   Paul Baldock dated 18 November 2009 with Exhibits PB-1 and PB-2 (‘Baldock’)

   Doug Matthews dated 9 November 2009 with Exhibits DM-1 and DM-2 (‘Matthews’)

   Nicholas Zigouras dated 24 November 2009 with Exhibits NZ-1 and NZ-2 (‘Zigouras’)

   Denis Rodney dated 3 December 2009 with Annexures DR-1 to DR-3 (‘Rodney’)

   Ken Williams dated 8 December 2009 with Annexures KW2-1 to KW2-3 (‘Williams 2’)

   Kevin Finn dated 9 December 2011 with Annexures KF-1 to KF-14 (‘Finn’)

   Tony Devon dated 8 December 2009 with Annexures TD-1 to TD-5 (‘Devon’)

   Stephen Hockham dated 9 December 2009 with Annexures SH-1 to SH-2 (‘Hockham’)

   In answer

   David Anthony Eisenhuth dated 10 September 2010 with Exhibits DE-1 to DE-99 (‘Eisenhuth’)

   Sam Park dated 11 September 2010 with Exhibits SP-1 to SP-7 (‘Park’)

   In reply

   Kevin Finn dated 16 March 2011with Exhibits KF-15 and KF-16 (‘Finn 2’)

10. It is convenient to start, as did both Messrs Fox and Park at the hearing, with a discussion of the declaration of Mr Eisenhuth.

11. Mr Eisenhuth is a Company Director of the applicant, a position he has held since 3 April 2000.  He states:

    [The applicant] was incorporated on 24 September 1990[3] and at the time of incorporation ACO Polymer Products Ltd (“ACO UK”) was the sole shareholder and owner of ACO Australia.

    [The applicant] is part of a multinational related group of companies (the ‘ACO GROUP’) that span 40 countries with 31 production sites in 12 countries, including Australia and the USA.

    The founding Northern European business of the ACO GROUP was started in 1946 and the ACO GROUP now employs more than 3,700 staff globally and in 2007 had a group turnover of about Euro 602 million.

    The HEELGUARD trade mark was authored by ACO UK on or about 1989 and introduced into the Australian market place by ACO UK on or about 1989.

    Up until 1993 when ACO Australia commenced trading in its own capacity, ACO UK sold and or made available for sale grate products under the HEELGUARD trademark in suit into the Australian marketplace since at least as early as on or about 1989.

    ACO Australia commenced trading in Australia its own capacity in 1993 and was known as ACO Technologies Australia Pty Ltd at the time, and at that time ACO UK cooperatively ceased trading in Australia other than [through] ACO Australia on or about the same time.

    ACO UK and ACO Australia at all material times have belonged to the same multinational related group of companies under the continuous ultimate ownership and control of Severin Ahlmann Holdings GMBH or its predecessor in title.

    ACO UK is the predecessor in business in Australia to ACO Australia, and also the predecessor in title to the HEELGUARD trade mark in Australia.

    [3] With the name ACO Polymer Products Limited.

12. Mr Eisenhuth gives the applicant’s previous legal names as being:

ACO Polymer Products Limited	24 September 1990 to 18 October 1990
ACO Polymer Products Pty. Limited	18 October 1990 to 31 May 1993
ACO Technologies Australia Pty Ltd	31 May 1993 to 17 August 1994
Polycrete Australia Pty Limited	17 August 1994 to 20 July 1995
ACO Polycrete Pty Ltd	20 July 1995 and continuing

1. I am satisfied that Mr Eisenhuth’s declaration establishes that ACO UK and the applicant were at all times applicable to these reasons as being different corporate entities.  It is of note that the opposed trade mark was used in Australia by ACO UK well before the incorporation of the applicant.

2. Mr Eisenhuth states:

   Exhibit DE-2 and DE-3 are illustrations of 1989 documentary publications distributed and or made available for distribution in the Australian market place by ACO UK include illustration of or reference to grate products offered or made available for sale under the HEELGUARD trade mark in suit.

   Exhibit DE-2 and DE-3 are only an extract of the complete publication and only include the front and rear page of each documentary publication, and relevant pages that include illustration of or reference to HEELGUARD grate products made available by ACO UK which have been marked up for convenient reference.

   Each of exhibit DE-2 and DE-3 includes a date reference of November 1989 on the front page, and further includes a 1989 copyright notice on the respective rear page in the name of ACO UK which have been marked up for convenient reference indicating the publications were in the public domain at least as early as on or about 1989, and the HEELGUARD trade mark had already been in use at that time.

   Onus

3. After reviewing the precedents in Pfizer Products Inc v Karam [2006] FCA 1663, in particular whether such matters should be decided in summary manner only on clear proof, Gyles J said of the onus in trade mark oppositions:

   I am faced with the clear words of the statute, on one hand, and the opinions of various judges, on the other. There is no binding Full Court authority. I cannot find any instance where a single judge has actually applied the higher standard. In my opinion, in this case, comity does not demand that I depart from my view as to the meaning of the statute. ‘The fundamental responsibility of a court when it interprets a statute is to give effect to the legislative intention as it is expressed in the statute’ per Mason J in Babaniaris v Lutony Fashions Pty Ltd [1987] HCA 19; (1987) 163 CLR 1; cited with approval by Mason CJ, Wilson, Dawson, Toohey and Gaudron JJ in John v Federal Commissioner of Taxation [1989] HCA 5; (1989) 166 CLR 417 at 439. I will, therefore, approach the matter on the basis that the opponent has to establish a ground of opposition, although not clearly establish such a ground, whether in a summary fashion or otherwise.

4. The opponent bears the onus of establishing one or more grounds of opposition on the balance of probabilities.  See also Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891 (18 August 2009) at [22] to [26]

   Section 58

5. Mr Fox argued that the ground under section 58 should be established because the evidence demonstrates that the use of the word HEELGUARD by traders other than the parties has been so widespread in relation to heel-proof drain gratings that the word, whatever its antecedents, has essentially passed into public ownership. My view, however, is that the evidence establishes something else.

6. Section 58 of the Act provides:

   58Applicant 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.

7. In order to establish a ground of opposition under the provisions of section 58, the opponent needs to establish that:

   ·   the respective trade marks of the applicant and the alleged owner are either identical or substantially identical[4],

   ·   the respective goods in question are the ‘same kind of thing’[5], and

   ·   the alleged owner has the earlier claim to ownership based on use prior to both the application to register and any actual use of the mark by the applicant[6].

   [4] Carnival Cruise Lines Inc. v Sitmar Cruises Ltd 31 IPR 375 (1994) 120 ALR 495

   [5] Re Hicks’ Trade Mark (1897) 22 VLR 636, 3 ALR 75

   [6] Settef SpA v Riv-Oland Marble Co (Vic) Pty Ltd 10 IPR 402 at 413

8. Concerning the first two ‘dot-points’ above, the trade marks under consideration are in fact identical and the goods are ‘the same kind of thing’, also being identical.

9. The latter ‘dot-point’ above was discussed by the Full Court in Shell Co. of Australia Ltd. v. Rohm and Haas Co. [1948] HCA 27; (1949) 78 CLR 601 (‘Shell’) at page 628:

   … it is clear enough from the course of legislation and of decision that an application to register a trade mark so far unused must, equally with a trade mark the title to which depends on prior user, be founded on proprietorship. The basis of a claim to proprietorship in a trade mark so far unused has been found in the combined effect of authorship of the mark, the intention to use it upon or in connection with the goods and the applying for registration. For a time the provision that application was equivalent to prior user necessarily embodied in statutory form the conclusion that the applying for registration completed title to the unused mark, where the other elements existed. But the principle had been already adopted by Cotton L.J. in In re Hudson’s Trade Mark (1886) 32 Ch D 311. (at p628)

   Authorship of course includes claim through or under the author. But it involves the origination or first adoption of the word or design as and for a trade mark. This is well brought out by the Victorian case of Re Hicks’s  Trade Mark [1897] VicLawRp 118; (1897) 22 VLR 636 which was decided on legislation in much the same form as the English Act of 1875. Hicks had obtained registration of the word “Empress” for stoves. A stove, the design of which had been registered, had been sold under the name Empress by the predecessors in title of Metters Brothers. Metters Brothers moved to rectify the register by expunging Hicks’s trade mark. For Hicks it was argued that prior user by him was unnecessary and that by registration he had made himself proprietor of the mark. In the course of the argument Holroyd J. said: - “A person cannot be properly registered unless he is the proprietor. Proprietor is the person who at the moment he makes application to be registered is entitled to the exclusive use of the name, whether he then or before publicly adopted it. A man cannot be said to have adopted a name if someone else has done so before him. Section 19 merely says that the act of applying is to be deemed equivalent to public user. No one could otherwise be entitled to registration as proprietor unless he had publicly used the trade name before. The section does not affect the fact that another person used the name first. The difficulty here is that although Hicks may have by virtue of his application publicly used the name, someone else publicly used it before him.” (1897) 22 VLR, at p 639.

10. The evidence establishes that the person who has the better claim to have first ‘authored’ and first used the purported trade mark HEELGUARD in Australia is not the applicant – that person is ACO UK. [7]  In the words of Mr Eisenhuth:

    The HEELGUARD trade mark was authored by ACO UK on or about 1989 and introduced into the Australian market place by ACO UK on or about 1989.

    [7] But see the caveat of my conclusions under section 41, below.

11. This statement is supported by brochures showing use of the word HEELGUARD in Australia by ACO UK before the date of incorporation of the applicant.

12. The applicant, it will be recalled, was incorporated on 24 September 1990 and did not trade until 1993.

13. It is not relevant in terms of the ownership of the opposed trade mark that the applicant claims a relationship to the ‘author’ and first user of the trade mark in Australia.  It is obvious from the evidence before me that, whatever the beliefs of the applicant that it is the successor in title to ACO UK and that, “ACO UK is the predecessor in business in Australia to ACO Australia, and also the predecessor in title to the HEELGUARD trade mark in Australia”, these beliefs are (on the evidence before me) not well founded.  The evidence demonstrates that the entities ACO UK and the applicant were at all relevant times distinct corporate entities albeit ones which are now ultimately owned or controlled by Severin Ahlmann Holdings GMBH.  There is no evidence (nor is it argued) that the trade mark HEELGUARD was assigned by ACO UK to the applicant or that ACO UK abandoned the trade mark[8] or that some other general law principle such as acquiescence or estoppel applies here.  Additionally, (although of course this is not determinative) there is no evidence that ACO UK regards the word HEELGUARD as being its trade mark[9] rather than typifying a particular kind of drainage grating.[10]  

    [8] Riv-Oland Marble Co. (Vic) Pty Ltd v. Settef SpA (1988) 19 FCR 569 per Bowen CJ, at 571-572.

    [9] It is a matter of public record that ACO UK has not registered the word HEELGUARD as a trade mark on the United Kingdom register of trade marks.

    [10] It is also a matter of public record that many traders within the United Kingdom other than ACO UK make or supply drainage gratings which are typified as being heel guard or HEELGUARD gratings: see for example, and amongst many others.

14. It necessarily follows that whatever the status of the word HEELGUARD as a trade mark, it is not owned by the applicant.

15. I am satisfied on the balance of probabilities that the applicant is not the owner of the opposed trade mark and the opponent has established its ground under section 58.

    Section 41

16. The opponent’s evidence which goes to this ground is the Rosenthal, Richards, Williams 1, Baldock, Matthews, Zigouras, Rodney, Williams 2, Finn, Devon and Hockham declarations.  With the exception of Rosenthal, these declarations (‘the trade declarations’) are made by people who are all in senior management positions in businesses which make, install or supply drainage gratings.  I do not intend to detail them all as in essence they state the same thing (albeit in differing ways).  Three or four examples should be sufficient. 

17. Daniel Rosenthal is an associate of Griffith Hack, the opponent’s patent and trade marks attorneys.  He states:

    On 6 November 2008 I conducted a search of the internet using the search engine Google using the words “HEELGUARD” and restricted to ‘pages from Australia’. Now shown to me and marked “Annexure DR-6” is a printout of the results of my search. Traders located by the search which appear to have been using the word “HEELGUARD” in relation to grates, in addition to the Applicant and Opponent, include Reln, sellers on eBay, Grate Drainage Products, Aquadux Commercial, Advance Stainless Steel, R&S Grating, B R Durham & Sons, Australian Road Covers Pty Ltd, Patent Products, Commercial Plumbing and Installation Supplies, Philmac, and Hydro H2O Pty Ltd.

18. Ken Williams is a director of the company Hydro H20 Pty Ltd (‘Hydro’) which appears in Mr Rosenthal’s search results.  At the hearing it was submitted by Mr Park that this evidence should be ‘read down’ as Mr Williams had previously worked for the applicant as its Victorian Sales Manager for some years.  I do not agree – it could otherwise be perceived that Mr Williams is better placed through this background to have a broader and more objective knowledge of the industry.  His declaration is entirely consistent with the other trade declarations.  Mr Williams states:

    Hydro has been partnered with MEA AG (Plc) (“MEA”) and successfully served Australia and New Zealand since 2003. MEA drainage, which is one of MEA’s divisions, is one of the world’s leading manufacturers and suppliers of modular linear drainage systems. Hydro’s product range is designed to suit the Australia/ New Zealand market. We design and manufacture new products to suit a growing range of applications and changes to application requirements.

    One of the products manufactured and distributed by Hydro are MEA Channel Grates which come in a variety of types including “ductile iron heelguard”, “composite heelguard” and “stainless steel heelguard”. I attach a copy of pages from Hydro’s website at (“the Website”) which provides information regarding the Grates at “Annexure KW-2”.

    The word heelguard is used by Hydro to describe a particular type of grate, namely one which has narrow slots of between 5 to 7 mm so that heels on shoes do not go down into the Grates and so the heel is guarded against damage. Other words used by Hydro to describe other types of grates are slotted, perforated and mesh, as shown on the copy of the pages from the Website referred to in paragraph 4 above.

    Hydro uses the word heelguard to describe the Grates verbally, on the Website, in marketing and advertising materials, and on sales documentation. I attach at “Annexure KW-3” examples of Hydro’s use of the word heelguard, which include copies of quotations to Hydro’s customers in 2005 and 2006, brochures which were printed and distributed in Australia in 2002, 2003/2004 and recently, and business cards.

    I commenced using the description heelguard when I started working in the drainage industry approximately 13 years ago. I continued using the description heelguard when I starting working at Hydro approximately seven years ago. Throughout this period of time, I am aware of the use of the word heelguard being used in the drainage industry generally to describe grates similar to the Grates.

1. Mr Paul Baldock is Business Development Manager of the company Australian Road Covers Pty Ltd (‘ARC’) that occurs in Mr Rosenthal’s search results.  Mr Baldock states:

   ARC is a manufacturer of high quality mild steel grates, frames and manhole covers. It also undertakes steel fabrication, structural steel, handrails, chequered plate covers and moulds for concrete products. ARC classifies its standard access covers, inspections covers and frames, road grates and frames into three categories, namely light duty, medium duty and heavy duty. Two of the products supplied by ARC are “heelguard trench grating” and “heelguard galvanized grating”. The word heelguard is used by ARC to describe grating which prevents the heels from shoes going through it so that they are guarded against damage (“Grates”).  I attach a copy of pages from ARC’s website at showing an example of ARC’s use of the term heelguard in relation to Grates at “Annexure PB-2”.

   I am aware that the term heelguard has been used in the drainage industry for at least ten (10) years as a generic word used to describe grating which prevents the heels from shoes going through it.

2. Mr Denis Rodney is a Director of the company BR Durham & Sons Pty Ltd (‘Durham’) that occurs in Mr Rosenthal’s search results.  Mr Rodney had held this position for five years at the time of making his declaration.  He states:

   Durham was established in 1950 and has been managed by the Durham family. It specialises in the production of cast iron, ductile iron, galvanised mild steel and reinforced pre-cast concrete drainage & sewer products. Due to its policy of rigid adherence to a deeply entrenched code of business ethics, Durham is highly regarded by Government Authorities and members of the Construction Industry such as Construction Contractors, Plumbers, Builders, Drainers, Hardware retailers and prominent suppliers to major projects. Durham is proud of its reputation as ‘The Grate King’. In addition to supplying drainage products throughout Australia, the company presently exports products to Fiji, Singapore, Papua New Guinea, Indonesia, Tonga, New Zealand & U.A.E, and it has the capability to export world wide.

   I worked for Durham for between ten and fifteen years before becoming a director of the company in 2004. During this time I am aware that the words heel guard have been used by the drainage industry generally, and by Durham, as a generic word to describe a type of drainage grate. These grates are designed for pedestrians so that heels on shoes cannot pass through them and so they are guarded from damage (“the Grates”). I attach a copy of pages from Durham’s website at showing examples of Durham’s use of the words heel guard in relation to Grates, together with a photograph showing a high heeled shoe on the Grates at “Annexure DR-2”.

   The word heelguard is also used by Durham in its marketing materials. I attach at “Annexure DR-3” copies of extracts from catalogues which Durham provides to its customers which refer to the word heelguard to describe the Grates. Durham has provided similar catalogues to its customers for at least the last five to six years, all of which have included reference to the word heelguard to describe the Grates. I estimate that Durham sends at least 150-200 catalogues to customers and potential customers every three months. Customers either call to request a copy of Durham’s catalogue, or Durham would send a copy of its catalogue to potential customers it had targeted, or customers would attend Durham’s premises and be provided with a copy of a catalogue in person. Durham’s customers include small businesses, large building companies, councils and local government departments, the RTA, and utility providers throughout Australia.

   At the last two pages of “Annexure DR-3” are copies of a Maintenance Brochure and a National Guide which refer to the word heelguard to describe the Grates. The Maintenance Brochure was created by Durham in 2008 and mailed out to approximately 160 local councils within New South Wales in or around March 2009 in order to provide information about Durham’s goods and services. The Maintenance Brochure has also since been inserted into Durham’s brochures referred to in paragraph 5 above. The National Guide was an advertisement created by Durham for a poster for National Guide to Public Works and Services in 2009 which was distributed nationwide.

3. Mr Park was critical of the provenance of some of the supporting evidence exhibited to the trade declarations.  While it is true that some of the exhibit materials to the above declarations might have come into existence after the priority date of the opposed application, I am satisfied that they shine a light on the situation that prevailed at the priority date and that if some of these materials did not exist at the priority date, then other similar materials did exist.  The materials which came into existence after the priority date are consistent with those materials in evidence which predate them and show a continuity and consistency of usage of the word HEELGUARD as particularising a heel resistant drainage grating.  The materials are also consistent with the statements of the deponents within the trade declarations.  Further, it stretches credulity to suppose that a disparate group of responsible and professional senior managers of so many competing companies have done otherwise than attest to the true facts before and at the application date.

4. It is apparent from these materials that the trade declarants have been familiar with the word HEELGUARD as designating drainage grating which is resistant to penetration by shoe heels for as long as 15 years before the priority date of the opposed application.  

5. The other trade declarations are of like ilk and state similar facts to those discussed at paragraphs 27 to 33, above. 

6. Section 41 of the Act provides:

   41Trade mark not distinguishing applicant’s goods or services

   (1)For the purposes of this section, the use of a trade mark by a predecessor in title of an applicant for the registration of the trade mark is taken to be a use of the trade mark by the applicant.

   Note 1:For applicant and predecessor in title see section 6.

   Note 2:If a predecessor in title had authorised another person to use the trade mark, any authorised use of the trade mark by the other person is taken to be a use of the trade mark by the predecessor in title (see subsection 7(3) and section 8).

   (2)An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (designated goods or services) from the goods or services of other persons.

   Note:For goods of a person and services of a person see section 6.

   (3)In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.

   (4)Then, if the Registrar is still unable to decide the question, the following provisions apply.

   (5)If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:

   (a)the Registrar is to consider whether, because of the combined effect of the following:

   (i)the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;

   (ii)the use, or intended use, of the trade mark by the applicant;

   (iii)any other circumstances;

   the trade mark does or will distinguish the designated goods or services as being those of the applicant; and

   (b)if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons; and

   (c)if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken not to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons.

   Note 1:For goods of a person and services of a person see section 6.

   Note 2:Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).

   (6)If the Registrar finds that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, the following provisions apply:

   (a)if the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant—the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other persons;

   (b)in any other case—the trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons.

   Note 1:Trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate:

   (a)  the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; or

   (b)  the time of production of goods or of the rendering of services.

   Note 2:Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).

7. In Blount Inc v Registrar of Trade Marks [1998] FCA 440, Branson J described the operation of section 41. She said:

   Subsections (3) to (6) of s 41 of the Act are designed to control the process by which the Registrar is to reach a conclusion as to whether the trade mark for which registration is sought is capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (“the designated goods or services”). If the trade mark is not so capable, the application for its registration must be rejected (s 41(2)). Subsection (3) requires the Registrar first to “take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons”. Having taken such matter into account, it is theoretically open to the Registrar to conclude:

   (a)     that the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons and capable, on that basis alone, of so distinguishing the designated goods or services; or

   (b)     that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons; or

   (c)     that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, but there is uncertainty, on that basis alone, that the trade mark is actually capable of so distinguishing the designated goods or services.

   The structure of s 41 of the Act dictates that if the Registrar reaches conclusion (a) above, then he or she will decide the question whether or not the trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons by reaching the answer that it is so capable by reason of its inherent adaptability to distinguish (s 41(2) and (3)). The Registrar will, in such circumstances, be required, by reason of the terms of s 33(1) of the Act, to accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application.

   If the Registrar reaches conclusion (b) or (c) above, he or she is, within the meaning of s 41(4) “unable to decide the question”. That is, he or she is unable, simply by taking into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services, to answer the question whether or not the trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons.

   If the Registrar reaches conclusion (b) above, then the provisions of paragraphs (a) and (b) of s 41(6) are brought into operation. If the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date of the application, the trade mark does distinguish the designated goods or services as being those of the applicant, the Registrar will not reject the application pursuant to s 41(2). The Registrar will, in such circumstances, accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application (s 33(1)). If the applicant fails to establish that because of the extent to which the applicant has used the trade mark before the filing date of the application, the trade mark does distinguish the designated goods or services as being those of the applicant, the Registrar must reject the application pursuant to s 41(2).

   If the Registrar reaches conclusion (c) above, then the provisions of paragraphs (a), (b) and (c) of s 41(5) are brought into operation. If the Registrar, having considered the combined effect of the matters listed in subparagraphs (i), (ii) and (iii) of s 41(5)(a), is satisfied that the trade mark does or will distinguish the designated goods or services as being those of the applicant, he or she will not reject the application pursuant to s 41(2). The Registrar will, in such circumstances, accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application (s 33(1)). If the Registrar, having considered the combined effect of the matter listed in subparagraphs (i), (ii) and (iii) of s 41(5), is not satisfied that the trade mark does or will distinguish the designated goods as being those of the applicant, the Registrar must reject the application (s 41(2)).

8. Initially, I am required in terms of subsection 41(3) of the Act to first “take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons”.

9. The inherent adaptation of a trade mark is to be gauged according to the classic test found in Clark Equipment Company v Registrar of Trade Marks [1964] HCA 55; (1964) 111 CLR 511 at 514, where Kitto J put the test under the 1955 Act as follows:

   “[T]he question whether a mark is adapted to distinguish [is to] be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives - in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess - will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it.”

10. A similar test was propounded in Registrar of Trade Marks v W & G du Cros Ltd [1913] AC 624 at 634-635, where Lord Waddington said:

    The applicant’s chance of success in this respect [ie in distinguishing his goods by means of the mark, apart from the effects of registration] must, I think, largely depend upon whether other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connection with their own goods.”

11. And in FH Faulding & Co Ltd v Imperial Chemical Industries of Australia and New Zealand Ltd [1965] HCA 72; (1965) 112 CLR 537 at 555, Kitto J again referred to the general principle:

    ... that the question to be asked in order to test whether a word is adapted to distinguish one trader’s goods from the goods of all others is whether the word is one which other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use upon or in connexion with their goods.

12. In terms of my consideration of the issues under section 41(3) the evidence shows that the word HEELGUARD is naturally and normally used by those Australian traders who make, supply or install drainage gratings to denote particular gratings as being resistant to penetration by the pointed heels of shoes. While Mr Park argued that there are other ways in which such gratings can be described, such as HEEL SAFE, I do not think that this is an answer if the most natural and normal term to use (and is in fact used by other traders) is the word HEELGUARD. For example, if the goods were ‘prepared foods’ and the proposed trade mark was the word SOUP, it is no answer to an allegation of a lack of any inherent adaptation in the proposed trade mark SOUP to state that there are other words such as ‘potage’ or ‘broth’ or ‘chowder’ that other traders might remain free to use in respect of their similar goods. The inherent nature of the word SOUP (considered in relation to the goods ‘prepared foods’) does not change only because there are alternative words available for other traders to use in respect of their similar ‘prepared foods’. Further, the applicant has not pointed to any other word that traders in fact regularly use to designate these particular drainage gratings other than the word HEELGUARD[11].

    [11] I note that there is an isolated use of the expression ‘heel safe’ in a brochure in the evidence.

13. This analysis of other traders’ use of the term HEELGUARD is consistent with the use in Australia of the word by ACO UK from 1989 where, in the brochures in evidence, the word HEELGUARD is interchanged with other words which only particularise the kinds of drainage grating that appear in the brochures.  It logically follows from the context of these interchanges with other generic words that the word HEELGUARD was used by ACO UK in those brochures only to denote certain of its drainage gratings as being resistant to penetration by the heels of shoes.[12]

    [12] As the evidence of ACO UK’s use of the term HEELGUARD is not evidence of use of the term by the applicant, it is not subject to the same caution expressed by Wilcox J in Ocean Spray Cranberries Inc v Registrar of Trade Marks [2000] FCA 177 about consideration of the applicant’s own evidence of use of the trade mark in relation to subsection 41(3).

14. The evidence satisfies me that the word HEELGUARD was (at the priority date and without improper motive) invariably used by traders other than the applicant who make, supply or install drainage gratings only in order to designate a particular kind of drainage grating as being resistant to penetration by the heels of shoes.

15. The conclusion that the opposed trade mark is not to any extent inherently adapted to distinguish the applicant’s designated goods from the similar goods of other persons is inescapable.[13] Therefore subsection 41(6) of the Act applies.

    [13] See also the Footnote to subsection 41(6) of the Act: trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services.

1. Subsection 41(6) requires me to consider whether the evidence establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant. If so, the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other person.

2. The applicant appears to have taken a quantitative approach to its evidence of use rather than a qualitative one – the words “because of the extent” within subsection 41(6) might be erroneously understood as implying that sheer volume of use of a sign in relation to goods or services might alone transform it into a distinctive trade mark. But, as Jacob J said in British Sugar Plc v James Robertson & Sons Ltd [1996] RPC 281 at 302:

   I have already described the evidence used to support the original registration. It was really no more than evidence of use. Now it is all too easy to be beguiled by such evidence. There is an unspoken and illogical assumption that ‘use equals distinctiveness’. The illogicality can be seen from an example: no matter how much use a manufacturer made of the word `Soap’ as a purported trade mark for soap the word would not be distinctive of his goods. He could use fancy lettering as much as he liked, whatever he did would not turn the word into a trade mark. Again, a manufacturer may coin a new word for a new product and be able to show massive use by him and him alone of that word for the product. Nonetheless the word is apt to be the name of the product, not a trade mark. Examples from old well-known cases of this sort of thing abound. The Shredded Wheat saga is a good example: the Canadian case is The Canadian Shredded Wheat Co Ltd v Kellogg Co of Canada Ltd (1938) 55 RPC 125 in the Privy Council and the United Kingdom case The Shredded Wheat Co Ltd v Kellogg Co of Great Britain Ltd (1940) 57 RPC 137 in the House of Lords. In the former case Lord Russell said (at page 145):

   ‘A word or words to be really distinctive of a person’s goods must generally speaking be incapable of application to the goods of anyone else.’

   It is precisely because a common laudatory word is naturally capable of application to the goods of any trader that one must be careful before concluding that merely its use, however substantial, has displaced its common meaning and has come to denote the mark of a particular trader.

3. The words of Lord Russell, above, are particularly apposite to the evidence before me.

4. Here the evidence shows that word HEELGUARD is ‘capable of application to the goods of any trader’ for the sake only of its ordinary signification.  The evidence also demonstrates that the word HEELGUARD has in fact been aptly and invariably applied to the similar goods of other traders in Australia for a considerable number of years before the priority date of the opposed application.  It has been so used by such traders only for the sake of its ordinary signification as typifying the particular kind of drainage grating to which it is applied.  And the word HEELGUARD has been so used by other traders without any apparent occurrences of deception or confusion as to the source or nature of the goods.

5. It is difficult under such circumstances to understand how (in the presence of these similar usages of the word HEELGUARD by other traders) the opposed trade mark could (through the applicant’s own analogous use of the word) have come at the priority date to designate only the applicant’s drainage gratings of a similar kind.

6. The applicant’s use of the word HEELGUARD has not changed or altered the word’s meaning so that it only denotes the applicant as the source of the drainage gratings to which the word is applied.  Rather, in my consideration, the applicant’s use of the word has been in general concord with the use of the word by other traders as only denoting a particular type of drainage grating.

7. Consequently, I do not consider that the applicant’s use of the opposed trade mark establishes that, because of the extent to which the applicant has used the trade mark before the filing date of the application, the trade mark does distinguish the designated goods or services as being those of the applicant.

8. I earlier commented that the grounds under sections 41 and 58 of the Act are to an extent interrelated. While it may be that ACO UK was first to use the word HEELGUARD in Australia in relation to the goods of interest, ACO UK (and not the applicant) could only ‘own’ the word as a trade mark if it both ‘authored and first adopted the word as and for a trade mark’.[14]  If (as I consider the evidence shows) ACO UK did not adopt the word in Australia ‘as and for a trade mark’ but as a designation of the kind of goods,  and while this designation was adopted and remains in legitimate currency amongst other traders, no amount of use of the word HEELGUARD by the applicant could either make the word distinctive of the applicant’s goods or make the applicant its owner.  Those horses, if they ever existed, have bolted.

   [14] To paraphrase Shell, above.

9. The opponent has established its grounds of opposition under sections 41 and 58 of the Act.

   Decision

10. Section 55 of the Act relevantly provides:

    55Decision

    (1)Unless the proceedings are discontinued or dismissed, 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.

11. I refuse to register trade mark application 1164611.

    Costs

12. The opponent has been successful and costs may follow the event. I award costs against the applicant at the official scale.

    Iain Thompson
    Hearing Officer
    Trade Marks Hearings
    8 September 2011