Parmalat Australia Pty Ltd v the a2 Milk Company Limited

[2019] ATMO 23

TRADE MARKS ACT 1995

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

Re:Opposition by Parmalat Australia Pty Ltd to extension of protection of International Registration Designating Australia 1325924 (5, 29, 30 & 44) (Australian trade mark application 1818256) - A2/A2 LOGO - held in the name of The a2 Milk Company Limited.

Delegate:	Jock McDonagh
Representation:	Opponent: Written submissions from Griffith Hack Lawyers Applicant: Brian Elkington of Adams Pluck Intellectual Property Attorneys
Decision:	2019 ATMO 23 Reg. 17A.29 opposition – Grounds pursued under sections 42(b) and 43 not established – IRDA to be granted protection.

Background

1. On 6 July 2016, The a2 Milk Company Limited (‘the Holder’) applied for extension of protection to Australia of International Registration no. 1325924. The current details of the resulting International Registration Designating Australia (‘the IRDA’) are:

Trade mark:
Trade mark application: International Registration:	1818256 1325924
Filing Date:	6 July 2016
Specification:	Class 5: Food for infants; powdered milk for babies; dietetic beverages adapted for medical use; animal semen; diagnostic preparations for veterinary purposes for detecting genetic predispositions; diagnostic test reagents for veterinary use Class 29: Milk powder; milk; cream; butter; cheese; yoghurt; milk beverages, milk predominating Class 30: Ice cream, frozen yoghurt; ices; frozen desserts Class 44: Veterinary services; animal breeding; providing information relating to animal breeding; genetic testing of animals for breeding purposes; breeding and stud services for animal

1. The IRDA was examined as required by Regulation 17A.12 of the Trade Marks Regulations 1995 (‘the Regulations’). IP Australia advertised its intention to extend protection to Australia in the Australian Official Journal of Trade Marks on 9 February 2017. 

2. Parmalat Australia Pty Ltd (‘the Opponent’) filed a Notice of Intention to Oppose the extension of protection to Australia of the IRDA on 31 March 2017. Thereafter the parties filed, respectively, a Statement of Grounds and Particulars (‘the Statement’) a Notice of Intention to Defend and filed evidence as provided by the Regulations.

3. I heard the matter in Canberra on 5 November 2018 as a delegate of the Registrar of Trade Marks. Griffith Hack Lawyers, representing the Opponent, relied on written submissions. Brian Elkington of Adams Pluck Intellectual Property Attorneys appeared for the Holder.

   Evidence

4. The following evidence was filed in the opposition:

Declarant	Status	Date, Known as	Exhibits
Evidence in Support
Nigel Ulrich	General Manager Legal of Opponent	25.09.17 ‘Ulrich’	NU-1 to NU-5
Phillip Rybinshi	R & D and Quality Manager of Opponent	29.09.17 ‘Rybinski’
Evidence in Answer
Jaron James McVicar	General Counsel and Company Secretary of Holder	8.01.18 ‘McVicar’	JJM-1 and JJM-2

1. Ulrich repeats the IRDA’s details and some opinion about the IRDA, and contains a detailed summary of government regulation affecting the dairy industry in Australia.

2. Rybinski, as well as reiterating the strict regulation of the dairy industry in Australia, also explains the existence of A2 protein in cows’ milk. It states that:

   ·     There are a number of types of protein in milk, the two primary types being casein and whey proteins.

   ·     Beta casein proteins are one of the three major casein proteins present in milk. The two primary types of beta casein proteins are A1 and A2.

   ·     The proportion of A2 and A1protein in milk can vary with different breeds of cows. On average, the A2 protein makes up approximately 60% of the beta casein proteins and the A1 protein makes up approximately 40%.

   ·      All cows naturally produce A2 protein. All A2 protein produced by cows has the same qualities and characteristics.

3. McVicar adds to the information in Rybinski with the following:

   ·     Originally all cows produced milk containing only the A2 beta casein protein, with A1 emerging through genetic mutation following domestication of cattle.

   ·     The Holder’s dairy products contain only the A2 beta casein protein type.

   ·     The Holder only uses milk from cows that have been genetically tested to confirm that they only produce the A2 beta casein protein type and not the A1.

   ·     Animals which have the A2/A2 genotype will produce milk containing only the A2 beta casein protein type.

   ·     The IRDA is not a universal certification standard for use in relation to animals tested as having the A2/A2 genotype; rather it shows that the Holder’s cattle have been tested for the A2/A2 genotype by a laboratory approved by the Holder.

   Discussion

4. The Opponent relied on sections 42(b) and 43 of the Act as the grounds of opposition. Regulations 17A.28 and 17A.34 extend grounds for rejection of, and opposition under the Act to IRDAs.

5. The Opponent’s s42(b) and 43 grounds of opposition were only pursued in respect of the class 29 and 30 goods, that is the Opponent did not pursue its grounds of opposition in respect of the classes 5 and 44 goods and services specified in the IRDA.

6. The onus is on the Opponent to establish the grounds of opposition relied upon: Unilever plc v Livingstone International Pty Ltd[1]; Lomas v Winton Shire Council[2].

   [1] (2001) 53 IPR 568

   [2] [2002] FCAFC 413

7. The Opponent has to establish a ground of opposition on the balance of probabilities: Pfizer Products Inc v Karam[3].

   [3] [2006] FCA 1663

   Section 42(b): Trade mark’s use contrary to law

8. Section 42 of the Act relevantly 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.

9. It must be found that use of the IRDA “would”, not “could”, be contrary to law: Advantage Rent-A-Car Inc v Advantage Car Rental Pty Ltd[4].

   [4] [2001] FCA 683 at [28]

10. In Parkdale Custom Built Furniture Pty. Limited v Puxu Pty Limited[5], Gibbs C.J. said at [8]:

    The words of s. 52 require the court to consider the nature of the conduct of the corporation against which proceedings are brought and to decide whether that conduct was, within the meaning of that section, misleading or deceptive or likely to mislead or deceive . . . . . The words “likely to mislead or deceive”, which were inserted by amendment in 1977, add little to the section; at most they make it clear that it is unnecessary to prove that the conduct in question actually deceived or misled anyone. In McWilliams v. McDonalds [1980] FCA 159; (1980) 33 A.L.R. 394 it was rightly held by Smithers J. and by Fisher J. that to prove a breach of s. 52 it is not enough to establish that the conduct complained of was confusing or caused people to wonder whether two products may have come from the same source, and that Southern Cross Refrigerating Co. v. Toowoomba Foundry Pty Ltd (1954) 91 C.L.R. 592, a decision on the Trade Marks  Act 1905 (Cth) as amended, is distinguishable: I need not add to what their Honours said on this subject (33 A.L.R.) at 397-8 and 412-3. I agree too with those learned judges that the court must decide objectively whether the conduct is misleading or deceptive or likely to mislead or deceive, and that evidence that members of the public have actually been misled is not conclusive: see at 399-400 and 413-4. I would add that evidence that members of the public were misled, not by any conduct of the defendant, but by other circumstances for which the defendant was not responsible, would be quite irrelevant.

    [5] [1982] HCA 44; (1982) 149 CLR 191.

11. In the same case Mason J. said at [30]:

    “. . . the onus is on the plaintiff to show that the conduct is likely to mislead or deceive. Therefore conduct which merely causes some uncertainty in the minds of relevant members of the public does not breach s. 52.”

12. The Opponent alleges that use by the Applicant of the IRDA would be contrary to law, that being Schedule 2 of the Competition and Consumer Act 2010, constituting the Australian Consumer Law (ACL). The Opponent relies a contravention of the following sections of the ACL:

    ·     Section 18 for conduct which is, or is likely to be, misleading or deceptive;

    ·     Section 29(1)(a)-(b) for making a false or misleading representation that the goods and/or services are of a particular standard, quality, value, grade or composition;

    ·     Section 29(1)(g) for making a false or misleading representation that the goods or services have sponsorship, approval, performance characteristics, uses or benefits;

    ·     Section 29(1)(h) for making a false or misleading representation that the person making the representation has a sponsorship, approval or affiliation;

    ·     Sections 33 and 34 for conduct that is liable to mislead the public as to the nature, the manufacturing process or the characteristics of the goods and/or services.

13. The Opponent submitted that the use of the IRDA on the class 29 and 30 goods contravenes the above sections of the ACL given the IRDA, and particularly the word VERIFICATION in the IRDA, gives rise to the following misleading representations:

    ·     the standard and quality of the class 29 and 30 goods have been independently verified by an authorised and qualified third party, such as Dairy Australia or other accredited industry body or government department;

    ·     the cows from which the milk, powdered milk, and milk/powdered milk based goods are produced have been independently verified by an authorised and qualified third party, such as Dairy Australia or other accredited industry body or government department;

    ·     the class 29 and 30 goods meet an independent test or standard of an authorized and qualified party such as Dairy Australia;

    ·     the cows from which the milk, powdered milk, and milk/powdered milk based goods are produced meet an independent test or standard of an authorised and qualified party such as Dairy Australia;

    ·     the class 29 and 30 goods have been independently tested and comply with a particular industry standard, such as the Australian Dietary Guidelines;

    ·     the class 29 and 30 goods comply with a particular industry standard such as the Australian Dietary Guidelines;

    ·     the class 29 and 30 goods have the approval or sponsorship of, or have been endorsed by, a qualified and independent third party, such as Dairy Australia or other accredited industry body or government department;

    ·     the Holder has the approval or sponsorship of, or has been endorsed by, a qualified and independent third party, such as Dairy Australia or other accredited industry body or government department;

    ·     the cows from which the milk, powdered milk, and milk/powdered milk based goods are produced have the approval or sponsorship of, or have been endorsed by, a qualified and independent third party, such as Dairy Australia or other accredited industry body or government department;

    ·     the milk, powdered milk, and milk/powdered milk based goods have a different characteristic to other goods of the same kind not sold by the Applicant, namely, the A2 beta casein protein; and

    ·     the cows from which the milk, powdered milk, and milk/powdered milk based goods are produced have a different characteristic to other dairy cows, namely, they produce the A2 beta casein protein.

14. The Opponent further submits that use of the IRDA in relation to the class 29 and 30 goods is likely to mislead or deceive because it is not clear whether the term ‘VERIFICATION’ refers to any or all of:

    ·     The a2 Milk Company;

    ·     the products expected to bear the trade mark; or

    ·     cows producing milk for the products bearing the trade mark.

15. Mr Elkington submitted that there is nothing false or misleading in the Holder’s IRDA. It details the Holder’s name, shows a cartoon cow’s face, states correctly that the product derives from A2/A2 genetics, indicated that the genetics have been verified, which it has. I accept the characterisation submitted by Mr Elkington.

16. The Opponent’s submissions that VERIFICATION represents, falsely, that such verification has been independently conducted by an authorised and qualified third party, such as Dairy Australia or other accredited industry body or government department is reading too much into the word.

17. None of the evidence supports a requirement for the Holder’s goods and services to be subject to independent verification. McVicar states that the IRDA is not a ‘universal certification mark’. There is no evidence that there is a certification mark for A2 milk.

18. McVicar states that the Holder’s cattle and milk have been tested by laboratories licenced by the Holder to verify that its milk contains only the A2 variant of the beta casein protein. I am satisfied that this would be a ‘verification’ in a manner contemplated by the appearance of the ordinary meaning of that word as it appears in the IRDA.

19. In the event that the Holder, at some stage, were to offer for sale milk or milk products that had not been subject to such verification, then the remedy under the ACL could be pursued in another jurisdiction.

20. I accept the evidence, particularly in Ulrich Exhibit NU-5, that there are strict health and safety standards applicable to dairy products offered for sale in Australia. However, the fact that such products are offered for sale would suggest to consumers that the products comply with the relevant standards.

21. There is no evidence to suggest that dairy products are required to bear certification of compliance with the relevant standards.  As I mention in [22] above, McVicar states that the IRDA is not a ‘universal certification mark’.

22. In my opinion, the Holder has deliberately chosen the term ‘verification’ to avoid any suggestion that its class 29 and 30 goods are in any way officially certified.

23. I am not satisfied that this ground of opposition, under section 42(b) of the Act, has been established.

    Section 43: Trade mark likely to deceive or cause confusion

24. Section 43 provides:

    43Trade mark likely to deceive or cause confusion

    An application for the registration of a trade mark in respect of particular goods or services must be rejected if, because of some connotation that the trade mark or a sign contained in the trade mark has, the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion.

25. To establish a ground of opposition under section 43, there must be an inherent connotation within the trade mark which is likely to deceive or cause confusion. The comments of Gyles J in Pfizer Products Inc v Karam[6] outlined the history of  section 43 of the Act, stating that:

    [6] (2006) 70 IPR 599 (at [52 -53]).

    Section 43 does not have a long pedigree. It was enacted pursuant to Australia’s obligations under the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS). TRIPS and the 1992 Working Party Report led to a 1994 Bill containing the following cl 42(2):

    ‘An application for the registration of a trade mark in respect of particular goods or services must be rejected if the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion regarding:

    (a)the nature, quality, origin, intended purpose, or some other characteristic, of the goods or services; or

    
    (b) any connection or relationship that they may have with any particular person.’

    That Bill was enacted but never came into force. In the 1995 Bill (and Act) cl 42(2) of the 1994 Bill was replaced by what is now s 43 of the 1995 Act. The Explanatory Memorandum stated that cl 43 provides:

    ‘That an application for registration must be rejected if the trade mark ... because of some signification inherent to it, would be likely to deceive or cause confusion regarding a characteristic of the goods or services.’
    [Emphasis added]

    It seems that the final form of s 43 is a wider version of the earlier clause with a similar purpose.
    ‘Connotation’ is a secondary meaning implied by the mark. The likelihood of deception or confusion must flow from the secondary meaning inherent in the mark itself. It is apparent that the underlying purpose of s 43 is a similar purpose to that lying behind ss 52, 53 and 55 of the Trade Practices Act 1974 (Cth). It is to prevent the public being deceived or confused as to the nature of the goods offered by reason of a secondary meaning connoted by the mark in question…

26. The Opponent submitted that the  IRDA, due particularly to the word VERIFICATION in the trade mark, has an inherent meaning or connotation that:

    ·     the standard and quality of the class 29 and 30 goods have been independently verified by an authorised and qualified third party such as Dairy Australia;

    ·     the cows from which the milk, powdered milk, and milk/powdered milk based goods are produced have been independently verified by an authorised and qualified third party, such as Dairy Australia or other accredited industry body or government department;

    ·     the class 29 and 30 goods meet an independent test or standard of an authorized and qualified party such as Dairy Australia;

    ·     the cows from which the milk, powdered milk, and milk/powdered milk based goods are produced meet an independent test or standard of an authorised and qualified party such as Dairy Australia;

    ·     the class 29 and 30 goods have been independently tested and comply with a particular industry standard such as the Australian Dietary Guidelines;

    ·     the class 29 and 30 goods comply with a particular industry standard such as the Australian Dietary Guidelines;

    ·     the class 29 and 30 goods have the approval or sponsorship of, or have been endorsed by, a qualified and independent third party such as Dairy Australia or other accredited industry body or government department; and

    ·     the Holder has the approval or sponsorship of, or has been endorsed by, a qualified and independent third party, such as Dairy Australia or other accredited industry body or government department.

    ·     the cows from which the milk, powdered milk, and milk/powdered milk based goods are produced have the approval or sponsorship of, or have been endorsed by, a qualified and independent third party, such as Dairy Australia or other accredited industry body or government department;

    ·     the milk, powdered milk, and milk/powdered milk based goods have a different characteristic to other goods of the same kind not sold by the Applicant, namely, the A2 beta casein protein;

    ·     the cows from which the milk, powdered milk, and milk/powdered milk based goods are produced have a different characteristic to other dairy cows, namely, they produce the A2 beta casein protein; , and that inherent meaning or connotation is false.

27. Further, the Opponent submitted that use of the IRDA in relation to the class 29 and 30 goods is likely to deceive or cause confusion because it is not clear whether the term ‘VERIFICATION’ refers to any or all of:

    ·     The a2 Milk Company;

    ·     the products expected to bear the trade mark; or

    ·     cows producing milk for the products bearing the trade mark.

28. Mr Elkington submitted that there was no secondary meaning identified by the Opponent for s43 to be satisfied, but in the alternative each of the relevant representations suggested by the IRDA are in fact true.

29. I refer to my comments under the s42(b) ground of opposition. For the reasons outlined there I accept Mr Elkington’s submissions on this ground.

30. I am not satisfied that this ground of opposition, under section 43 of the Act, has been established.

    Decision

31. Regulation 17A.34N provides:

    17A.34N  Decision on opposition

    (1)Unless the opposition proceedings are discontinued or dismissed, the Registrar must decide:

    (a)to refuse protection in respect of all of the goods or services listed in the IRDA; or

    (b)to extend protection in respect of some or all of the goods or services listed in the IRDA (with or without conditions or limitations);

    having regard to the extent (if any) to which the grounds on which the IRDA was opposed have been established.

    (2)The Registrar must notify the International Bureau of the Registrar’s decision.

1. The Opponent has not established the grounds on which the IRDA was opposed and it is appropriate that the Registrar decides to extend protection to the Trade Mark.

2. The IRDA may then proceed to protection one month from the date of this decision.  If the Registrar has been served with a notice of appeal before that time, I direct that protection shall not occur until the appeal has been decided or discontinued and the disposition of the IRDA be in accordance with the Court’s order or direction.

   Costs

3. 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 under section 221 of the Act in terms of Schedule 8 of the Regulations.

   Jock McDonagh
   Hearing Officer
   Oppositions and Hearings
   13 February 2019