Philmac Pty Ltd

[2000] ATMO 132

TRADE MARKS ACT 1995

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

Re:Trade mark application number 796572 - colour: terracotta - in the name of Philmac Pty Ltd.

Background

Trade mark application number 796572 was filed on 8 June 1999 in the name of Philmac Pty Ltd (the applicant). The applicant seeks to register the colour terracotta - as applied to the connecting insert of non-metallic rigid irrigation pipe fittings and connectors in class 17.

During the course of examination, only two reports issued. In both reports, the Principal Examiner (to whom the application was referred) advised the agent that the trade mark would need to meet the requirements of subsection 41(6). The Principal Examiner held that the mark was not capable of distinguishing the applicant's goods from those of other traders. This was because it consisted simply of a single colour and, as such, was not adapted to function as a trade mark as specified by section 17 of the Act. She said that other traders were likely to wish to use the colour in relation to their own goods.

The Principal Examiner maintained the grounds for rejection, despite the submissions and evidence provided in support of the application. In addition, the matter of the description of the mark remained unresolved. As a result, the applicant sought a decision in the matter on the written record and the matter has now come before me, as a delegate of the Registrar, to be decided on the basis of the material currently on file. The applicant did not file any further submissions or evidence, to those already before the Principal Examiner.

Evidence

The applicant's evidence consists of a statutory declaration (with exhibits) by Chris Strathy, Marketing and Development Director of the applicant. Five exhibits were attached, which included samples of the applicant's promotional material.

The applicant declares that it is the market leader in rural polyethelyne pipe compression fittings, having approximately 65% of the market in respect of these goods. It also states that it has been manufacturing and supplying these products throughout Australia for the past 25 years.

Mr Strathy, in commenting on the industry of the designated goods, asserts that such pipe fittings are commonly sold by rural agencies, with the fittings of different suppliers usually "mixed-up" in the same receptacle or box. He says that, although the external design or shape of the fittings may be different, the products are essentially matt black in appearance and are of a similar size. On this basis, the applicant claims that there is significant potential for purchasers to be confused about the manufacturer of the fittings. As a consequence, the applicant sought to distinguish its products by manufacturing the fittings with what it describes as "a distinctive terracotta-coloured insert". This insert, it says, is easily visible and protrudes from the end(s) of the fittings. The applicant further claims that its considerable reputation for manufacturing quality fittings is now associated with this terracotta-coloured insert.

The applicant indicates that it has manufactured and sold fittings with this insert since 1995 throughout Australia. Over the period 1996-1999, the revenue generated from the sale of these fittings totals tens of millions of dollars. No figures have been supplied in respect of advertising expenditure, however the applicant declares that the product has been extensively promoted throughout Australia since its launch.

The law

The definition of a trade mark is provided by section 17 of the Act, which reads as follows:

What is a trade mark?

17. A trade mark is a sign used, or intended to be used, to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person.

Note:  For sign see section 6.

A sign is defined in section 6 as:

sign includes the following or any combination of the following, namely, any letter, word, name, signature, numeral, device, brand, heading, label, ticket, aspect of packaging, shape, colour (my emphasis), sound or scent.

For a sign, as described by section 6, to qualify for registration, it must be capable of distinguishing the applicant's goods in terms of section 41 of the Act. Indeed, subsection 41(2) of the Act directs that, if a trade mark is not capable of distinguishing, the Registrar must reject the application.

Subsections 41(3) to 41(6) of the Act are concerned with the operation of section 41 and read as follows:

s41

(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 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).

Under the provisions of section 41, a trade mark may only proceed if the Registrar is satisfied that it is capable of distinguishing. If so, section 33(1) binds the Registrar to accept the trade mark. If the Registrar is not satisfied that the trade mark is capable of distinguishing, and the applicant fails to demonstrate otherwise, the Registrar must reject the application in terms of subsections 41(2) and 33(2) - Blount Inc v. Registrar of Trade Marks[1] (the Oregon case) and Ocean Spray Cranberries Inc v Registrar of Trade Marks[2] (the Cranberry Classic case).

[1] Blount Inc v. Registrar of Trade Marks 40 IPR 498.

[2] Ocean Spray Cranberries Inc v Registrar of Trade Marks (2000) AIPC 91-539.

The operation of section 41 is analysed by Branson J in the Oregon case (p 504), and Wilcox J in the Cranberry Classic case adopts her Honour's analysis in this regard. In deciding a trade mark's capacity to distinguish under the terms of section 41, Branson J directs that the Registrar may 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 distinguishing the designated goods or services.

In each of the alternatives set out by Justice Branson, the degree of inherent adaptation of a trade mark is the first consideration to be made. The concept of inherent adaptability is reviewed by Wilcox J in the Cranberry Classic case. Here, his Honour refers to Kitto J's directives in Clark Equipment Co v Registrar of Trade Marks[3] (the Michigan case) and says (paragraph 23):

[3] Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511 at 514.

This test was cited with approval by Gibbs J in Burger King Corporation v Registrar of Trade Marks (1973) 128 CLR 417 at 425. In F H Faulding & Co Limited v Imperial Chemical Industries of Australia and New Zealand Limited (1965) 112 CLR 537, the Full High Court was concerned with an application for registration of the word "Barrier" in relation to skin protection creams. Kitto J (with whom Barwick CJ and Windeyer J agreed) said at 555:

"... 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."

Although this test was framed in the context of a 'word mark', the principle involved applies to the inherent capacity of any sign to distinguish the goods of one trader from those of another. Thus, the relevant question to be answered is whether the colour "terracotta" is a sign which other traders are likely, in the ordinary course of their business and without any improper motive, to desire to use in connexion with the designated goods.

In considering whether a sign is inherently adapted to distinguish, the words of Justice Jacob in British Sugar PLC v James Robertson & Sons Ltd[4] (the Treats case) must also be observed. Here, his Honour says:

[4] British Sugar PLC v James Robertson & Sons Ltd [1996] RPC 281 at 306.

The phrase ["devoid of any distinctive character"] requires consideration of the mark on its own assuming no use.  Is it the sort of word (or other sign) which cannot do the job of distinguishing without first educating the public that it is a trade mark?  A meaningless word or a word inappropriate for the goods concerned ("North Pole" for bananas) can clearly do.  But a common laudatory word such as "Treat" is, absent use and recognition as a trade mark, in itself ... devoid of any distinctive inherently character.

Therefore, in the present circumstances, the question also arises - is the colour here a sign that can distinguish the applicant's goods without the need to first educate the public to the fact that it is a trade mark?

Discussion

Firstly, in order to clarify the requirements of subregulation 4.3(7), I will briefly comment on the description of the mark. At present, the applicant describes the mark as:

The colour terracotta as applied to the connecting insert of polypipe fittings.

As the description of the trade mark is the defining factor in cases such as this[5], a precise and accurate definition of the mark is needed. There appears to be little discrepancy between the applicant's description of the mark and the pictorial representations provided as part of the evidence. However, in order to properly define the extent of the trade mark, the description of the mark requires amendment and a pictorial representation of the trade mark (as it appears in the evidence) should be attached to the application form. The description of the mark should read as follows:

[5] Levi Strauss & Co v Kimbyr Investments Ltd 28 IPR 249.

The trade mark consists of the colour TERRACOTTA, applied to the connecting inserts of the goods, as shown in the representation attached to the application.

Turning now to the substantive grounds for rejection, a single colour applied to the goods or the packaging of goods will, on the whole, have a very low level of inherent adaptation to distinguish.[6] As a result, there is usually a heavy onus on the applicant to show that the colour does or will distinguish the applicant's goods. Nevertheless, the level of inherent adaptation to distinguish must be assessed in relation to the goods or services on which the colour is to be used. The considerations to be made include: the nature of the goods; the market in which they are sold; the particular colour for which registration is sought; whether that colour serves a particular function in respect of the goods and/or whether there is a competitive need for it within the market concerned.

[6] Trade Marks Office Draft Manual of Practice and Procedure (the Draft Manual) - paragraph 4 of Part 21.

In the present case, the applicant has declared that pipe fittings of this nature are usually matt black in colour. The applicant also states that it adopted the colour in order to make its products clearly visible from the fittings of other manufacturers, given the usual appearance and mode of sale of the goods. However, on the information before me, I am reluctant to conclude that other manufacturers within the industry do not typically apply, or wish to apply, different colours to their products. In instances where many competitors produce like products (as per the application goods), I think it is reasonable to assume that other manufacturers might well desire to use colour in relation to their own goods. Indeed, the applicant's own reason for applying colour to its products suggests that there is a competitive need for colour within the industry.

The goods, being non-metallic rigid irrigation pipe fittings and connectors, are made from material which, by its nature, can be easily coloured during manufacture. Further, the competitiveness of the marketplace suggests that other manufacturers may be using colour, or wish to use colour, without any improper motive, in relation to their own goods. The colour used by the applicant, being a type of 'tan' or 'orange' colour, is not, in my opinion, particularly innovative. In fact, a glance at any hardware catalogue where irrigation and tap fittings are advertised clearly shows that terracotta-like colours, such as 'tan' or 'orange', are widely used in relation to such goods. Likewise, I do not consider the manner in which the colour is applied to the connecting inserts to be out of the ordinary.

I do not believe that the coloured inserts would appear as anything more than a decorative feature to the consumer. Thus, unless they were trained otherwise, and there is no evidence of this, it is unlikely that consumers would consider the coloured features of the applicant's products to be a trade mark. The placement of an almost ordinary colour (as a sign) on some small part of a fitting, and where it would not be seen in the course of ordinary use (ie. once connected to other fittings), does not, in my view, develop fundamental trade mark qualities.

In light of the foregoing, I find that the trade mark for which the applicant seeks registration is not, to any extent, inherently adapted to distinguish. Having reached this conclusion, the onus rests with the applicant to show that the mark distinguished the designated goods as being those of the applicant, as at the filing date of the application.

The relevant date, when considering the evidence of use of the mark, is the 8 June 1999 (the filing date of the subject application). The applicant has manufactured and sold fittings with the coloured inserts since 1995 throughout Australia. Over the period 1996-1999, the revenue generated from the sale of these fittings totals tens of millions of dollars. Although no figures are supplied in respect of advertising expenditure, the applicant declares that the product has been extensively promoted throughout Australia since its launch. However, the applicant did not supply any further evidence in the form of supporting declarations from the trade, a detailed market share analysis, or any other information of this type, which would have been of assistance here.

In my view, the evidence demonstrates that the applicant has developed, over many years, an extensive reputation in the word philmac. In terms of the subject trade mark, however, the evidence fails to establish that the coloured features of the applicant's products perform the function of a trade mark, or that the sign itself distinguishes the applicant's goods. I acknowledge that there appears to have been substantial sales and marketing of products bearing the mark, albeit over a brief period of time. I also recognise that, despite a lack of evidence which signifies public perception, the colour may make the applicant's products more appealing and more identifiable. Consumers may well recognise, to some extent, the coloured features of the applicant's fittings and identify with the applicant's products on this basis. However, such recognition does not equate to recognition as a trade mark, nor does it indicate that the sign, in itself, denotes the goods of the applicant. Again, I refer to the words of Jacob J in the Treats case, supra, (p 304): "... recognition is not the same thing as perception as a trade mark - as not only recognising the word but as regarding it, in itself, as denoting the goods of one particular trader."

On the question of factual distinctiveness (ie. the capacity of a mark to distinguish, as is acquired through use), Jacob J found that it was one of degree, saying (p 306):

The proviso really means 'has the mark acquired a sufficiently distinctive character that the mark has really become a trade mark.' In the case of common or apt descriptive or laudatory words compelling evidence is needed to establish this."

"... but it must be shown in a case of this sort that the mark has really become accepted by a substantial majority of persons as a trade mark."

Although the relevant matter for determination in the present case is whether the subject trade mark is 'capable of distinguishing', it is clear the deliberations of Jacob J, in regard to 'factual distinctiveness, apply to the considerations to be made under subsection 41(6).

As I have already indicated, there has been little evidence provided, other than sales revenue, and on this information alone I find that I am unable to determine: a) what the perception of the trade mark is within the relevant market; and b) whether, because of its use, the mark distinguishes the designated goods as being those of the applicant. This is all the more so when the mark has been used in conjunction with another sign, which is obviously looked upon as a trade mark, ie philmac.

On the basis of the foregoing, I find that the evidence falls short of demonstrating that the applicant's trade mark distinguished the relevant goods, under the terms of subsection 41(6), at the date of filing of the present application.

Decision

I have found that the trade mark, the subject of application 796572, has no inherent capacity to distinguish. Further, I am not satisfied that the evidence filed in support of the application shows that, at the date of filing, the mark served to distinguish the designated goods as being those of the applicant.

Having found that the trade mark is not capable of distinguishing, under the terms of subsection 41(6), I am required to reject the application. I therefore reject trade mark application 796572, pursuant to the provisions of subsection 33(3).

Michelle Edlington
A/Hearing Officer

14 December 2000