Pt Marks Pty Ltd v Mikaela Borg

[2024] ATMO 118

TRADE MARKS ACT 1995

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

Re:Opposition by PT Marks Pty Ltd to an application under section 92 of the Trade Marks Act 1995 (Cth) by Mikaela Borg to remove trade mark number 1075626 (class 14) - MIKI - in the name of PT Marks Pty Ltd

Delegate:

Benjamin Goldsworthy

Representation:

Removal Opponent: Self-represented

Removal Applicant: Jacqui Pryor of Mark My Words Trademark Services Pty Ltd

Decision:

2024 ATMO 118

Trade Marks Act 1995 (Cth) – application under section 92(4)(b) – use of trade mark not established in the relevant period – no obstacles to use established – discretion not exercised for any goods –– registration to be removed

Background

1. This matter concerns an application under s 92(4)(b) of the Trade Marks Act 1995 (Cth)[1] seeking removal of a trade mark from the Australian Register of Trade Marks (‘Register’) for non-use. I extract details of the trade mark below:

Trade mark number:     1075626

Trade mark:  MIKI (‘Trade Mark’)

Owner:  PT Marks Pty Ltd (‘Removal Opponent’)

Filing date:  15 September 2005

Goods:  Class 14: Cases for watches (presentation); clocks and watches, electric; containers especially adapted for presentation and display of jewellery, watches, etc.; movements for clocks and watches; watches (‘Removal Goods’)

[1] Unless specified otherwise, a reference in these reasons to a section is a reference to such in the Trade Marks Act 1995 (Cth) (‘Act’) and a reference to a regulation is a reference to such in the Trade Marks Regulations 1995 (Cth).

1. On 30 August 2022 Mikaela Borg (‘Removal Applicant’) filed a request for removal of the Trade Mark for non-use under s 92(4)(b) for all of the Removal Goods.

2. On 24 October 2022 the Removal Opponent filed its Notice of Intention to Oppose the application for removal. On 11 November 2022 the Removal Opponent filed its Statement of Grounds and Particulars. On 22 December 2022 the Removal Applicant filed her Notice of Intention to Defend.

3. On 27 March 2023 the Removal Opponent filed its Evidence in Support (‘EIS’) being a declaration of Pauline Wrobel, director at the Removal Opponent and director of Sax International Pty Ltd (‘Sax’), dated 24 March 2023, with Exhibits A to G (‘Wrobel’). On 31 March 2023, the Removal Applicant’s attorney advised by letter that the Removal Applicant would not be filing Evidence in Answer.

4. On 5 May 2023, the Removal Applicant requested to be heard by way of written submissions only. On 23 January 2024, the Removal Opponent requested to be heard by way of written submissions. On 13 February 2024, the Removal Opponent filed its written submissions which were prepared by Pauline Wrobel. On 27 February 2024 the Removal Applicant filed written submissions prepared by Jacqui Pryor of Mark My Words Trademark Services Pty Ltd. I am to decide the matter as a delegate of the Registrar of Trade Marks based on the evidence and submissions discussed above.

Relevant period and onus

1. Section 92 relevantly provides:

   92  Application for removal of trade mark from Register etc.

   …

   (4)  An application under subsection (1) or (3) (non‑use application) may be made on either or both of the following grounds, and on no other grounds:

   …

   (b)  that the trade mark has remained registered for a continuous period of 3 years ending one month before the day on which the non‑use application is filed, and, at no time during that period, the person who was then the registered owner:

   (i)  used the trade mark in Australia; or

   (ii)  used the trade mark in good faith in Australia;

   in relation to the goods and/or services to which the application relates.

2. Sufficient time has passed for s 92(4)(b) to be alleged.[2] By ss 92(4)(b), 100(1)(c) and 100(3) the Removal Opponent must establish use of the Trade Mark in Australia in the three year period ending on 30 July 2022 (‘Relevant Period’) or that the Trade Mark was not used in relation to the Removal Goods because of circumstances that were an obstacle to the use of the Trade Mark during the Relevant Period. The Removal Applicant alleges that there has been no use of the Trade Mark in relation to any of the Removal Goods in the Relevant Period. The allegation can be rebutted by establishing use by the owner of the Trade Mark or by an ‘authorised user’.

   [2] Act s 93(2) prior to amendments to that section brought about by the Intellectual Property Laws Amendment (Productivity Commission Response Part 1 and Other Measures) Act 2018 (Cth) sch 1 pt 3 applies as the amended s 93(2) applies only to trade mark applications filed from 24 February 2019 onwards.

3. It is the Removal Opponent who must rebut the allegation of non-use.[3] Any findings of fact are based on the civil standard of the balance of probabilities.[4]

   [3] Section 100(1)(c).

   [4] Pfizer Products Inc v Karam [2006] FCA 1663 (Gyles J).

4. Use ‘as a trade mark’ is use of a trade mark as a ‘badge of origin’ in the sense that it indicates a connection in the course of trade between the challenged goods and the person who applies the sign to those goods.[5] This does not require the actual sale or purchase of the goods.[6] A commercial dealing in relation to the goods under, or by reference to, the sign is sufficient to constitute ‘use as a trade mark’. A single bona fide use during the Relevant Period is sufficient for the Removal Opponent to discharge the onus,[7] although if only a single instance of use is alleged it should be established by, ‘if not conclusive proof, at any rate overwhelmingly convincing proof’.[8]

   [5] Coca-Cola Co v All-Fect Distributors Ltd [1999] FCA 1721, [19] (Black CJ, Sundberg and Finkelstein JJ).

   [6] Oakley Inc v Franchise China Pty Ltd [2003] FCA 105, [29] (Drummond J).

   [7] Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261, [17] (Drummond J).

   [8] Nodoz Trade Mark [1962] RPC 1, 7 (Wilberforce J).

5. If the requisite use is not established, in accordance with s 101, I may decide to remove the Trade Mark, or if satisfied it is reasonable to do so, decide to not the remove it. I explain this discretion in more detail further below.

Evidence

1. Wrobel states that the Trade Mark is licensed to Sax.[9] Wrobel states Pauline Wrobel is the sole director of the Removal Opponent and sole director of Sax.[10] Wrobel provides no further details or corroborating evidence about her directorship and/or shareholding of the Removal Opponent and Sax within the Removal Period. Sax is said to wholesale ‘cosmetics and accessories nationwide to pharmacies, major department stores and specialty stores’ under branding including the Trade Mark.[11] Sax is said to have done so since 2005.[12] The Removal Opponent also owns Australian registered trade mark 1033657, which is identical to the Trade Mark and in respect of class 3 ‘cosmetics, soaps, perfumery, essential oils, skin care products, body care products, beauty products, non-medicated preparations for use in the bath and shower including bath salts and bath products, toiletries, preparations for care of hair and shampoos’ and has a priority date of 9 December 2004.

   [9] Wrobel, [3].

   [10] Wrobel, [1] and [4].

   [11] Wrobel, [5].

   [12] Wrobel, [6].

2. Wrobel makes various general statements that the allegation of non-use of the Trade Mark in relation to the Removal Goods is untrue. There is a general statement that Sax sells watches under the Trade Mark at its warehouse shop in Victoria, with an undated image showing watches at Exhibit C to Wrobel. Retail sales for cosmetics sold under the Trade Mark are provided and are substantial. No retail sales figures for the Removal Goods are provided. However, Wrobel states that sales have been impacted by the period of the Covid-19 pandemic and the Removal Opponent intends to continue to use the Trade Mark and launch new products in the area of cosmetics and toys.

3. At Exhibit A to Wrobel is what I would describe as product sheets (‘Product Sheets’). The Product Sheets display various wrist watches alongside the Trade Mark, these appear to be targeted at wholesale purchasers, with the wrist watches shown in a counter display stand. The individual wrist watches appear to each be packaged in a rectangular box which bears the Trade Mark. The bottom of Product Sheets each also display the name ‘Sax International’ alongside an address and phone number. Also present are the numbers ‘01/21’ which appears to refer to the date as being January 2021. Some of the sheets have the numbers ‘03/20’ appearing to refer to March 2020.

4. The Exhibits to Wrobel, otherwise variously show the Trade Mark in relation to watches, boxes for watches and traditional alarm clocks. There are also instances of the Trade Mark appearing in respect of cosmetics and toys. Exhibit E to Wrobel is a photograph showing alarm clocks and watches bearing the Trade Mark. At the top of the page the year 2023 has been added. The other Exhibits to Wrobel are also either not dated, or they are not dated other than by general statements.

Consideration

Use of the Trade Mark in the Relevant Period

1. The closest thing to dated instances of use of the Trade Mark shown in the evidence are the Product Sheets at Exhibit A to Wrobel. Therefore, I consider these first. A sign is taken to be applied as a trade mark in relation to the Removal Goods if it is used ‘in an invoice, wine list, catalogue, business letter, business paper, price list or other commercial document’.[13] The word ‘MIKI’ appears on the Product Sheets. As presented it is substantially identical with the Trade Mark[14] and its use amounts to use as a badge of origin. The words ‘Sax International’ are also displayed on the Product Sheets as the issuer. The Removal Applicant ‘acknowledges that there is a year on each of these pages’.[15] Wrobel describes the Product Sheets as, ‘samples of selling pages used by the Sax sales team to sell watches under [the Trade Mark] during the three year period’.[16] There is no information about what or if any circulation took place for the Product Sheets or otherwise any specific examples of use of them in the Relevant Period. I also note that there is otherwise no information about any specific sales that have taken place in the evidence.

   [13] Section 9(1)(c)(ii).

   [14] Section 7(1).

   [15] Removal Applicant’s Submissions, [22(iii)].

   [16] Wrobel, [8].

2. If the use of a trade mark has been by a person other than the registered owner, the Removal Opponent bears the onus to show that such use was authorised.[17] As all the dated uses of any trade marks shown by the evidence at Exhibit A is by Sax, the Removal Opponent must show that those uses of the Trade Mark were authorised by the Removal Opponent for any of the evidence to be relevant to a rebuttal under s 100(3)(a). For use to be authorised, it must be shown that the registered owner, here the Removal Opponent, exercised control over the other entity’s use of the trade mark. This is a question of fact and degree.[18] Control by the Removal Opponent for these purposes can be the exercise of quality control, financial control or some other relevant form of control over use of the Trade Mark by the Removal Opponent.[19] Where the evidence shows a ‘unity of purpose’ and common directorship, this can, in certain circumstances, be sufficient to establish control.[20] 

   [17] See ss 100(3), 7(3) and 8.

   [18] Lodestar Anstalt v Campari America LLC [2016] FCAFC 92, [98] (Besanko J).

   [19] Ibid [184]-[185] (Katzmann J).

   [20] Trident Seafoods Corporation v Trident Foods Pty Ltd [2019] FCAFC 100 (Reeves, Jagot and Rangiah JJ).

3. For Sax to be considered an authorised user of the Trade Mark in respect of the Removal Goods the Removal Opponent must demonstrate it exercises financial control over Sax’s trading activities, or, that Sax otherwise uses the Trade Mark under its control. There is no information or evidence demonstrating that the Removal Opponent has such control over the alleged use by Sax within the Relevant Period. I note that Wrobel declares that Sax is licensed by the Removal Opponent to use the Trade Mark. However, there is no corroborating evidence or information about the specifics of this alleged licensing relationship.

4. Wrobel states that Pauline Wrobel is the sole director of the Removal Opponent and is also the sole director of Sax. However, no corroborating evidence or information is provided, such as a company extract from the Australian Securities and Investments Commission database. Therefore, I cannot be satisfied that during the Relevant Period, the Removal Opponent and Sax, by a common directorship and/or ownership had a ‘unity of purpose’.

5. I am otherwise unable to conclude that the Removal Opponent exercised quality, financial or other relevant control over the use that has been shown by Sax. Accordingly, any use of the Trade Mark in relation to the Removal Goods by Sax is not use of the Trade Mark by the registered owner so as to rebut the allegation of non-use of the Trade Mark.

6. The remaining evidence does not assist the Removal Opponent as it is generally not dated or is dated outside the Relevant Period. For example, whilst Exhibit C to Wrobel is said to contain photographs taken at the warehouse shop of Sax showing watches on display, this evidence is not dated in the Relevant Period other than by a general statement. The examples of the merchandising of watches sold under the Trade Mark are also not corroborated as occurring in the Relevant Period other than by a general statement.

7. Accordingly, I am not satisfied that the Removal Opponent has used the Trade Mark in relation to any of the Removal Goods during the Relevant Period.

Obstacles to use

1. Wrobel asserts that the Removal Opponent’s sales were impacted by the Covid-19 pandemic. This statement rises no higher than an assertion and is not sufficient to demonstrate an obstacle to use of the Trade Mark. There is no evidence otherwise demonstrating any obstacle which prevented good faith use of the Trade Mark in relation to the Removal Goods during the Relevant Period.

Registrar’s discretion

1. Section 101(3) provides me with a broad discretion to not remove the Trade Mark from the Register even where s 92 grounds have been established, provided I am satisfied it is reasonable to do so. I must consider whether this discretion should be exercised in relation to the Removal Goods. However, the Removal Opponent need not establish ‘exceptional circumstances’.[21] The Opponent relevantly submitted:

   [I]t would be inequitable to remove [the Trade Mark] for non-use given [the Trade Mark] continues to enjoy goodwill from the associated MIKI Cosmetic Trade Mark, the supply challenges during the three year period and that Sax intends to grow the MIKI watch/clock business and the overall brand moving forward.

   [21] E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2008] FCA 934, [198] (Flick J) citing Kowa Co Ltd v Organon [2005] FCA 1282, [98] (Lander J).

2. Various factors are to be considered in applying s 101. In PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd the Federal Court observed of s 101(3) and the relevant factors:

   [t]he following propositions are relevant to the exercise of this discretion:

   (1) It is broad and is unfettered in the sense that there are no express limits on it. It is to be understood as limited only by the subject-matter, scope and purpose of the legislation and, in particular, by the subject-matter scope and purpose of Part 9 of the Trade Marks Act.

   (2) The scope and purpose of the Trade Marks Act strikes a balance between various disparate interests. On the one hand there is the interest of consumers in recognising a trade mark as a badge of origin of goods or services and in avoiding deception or confusion as to that origin. On the other is the interest of traders, both in protecting their goodwill through the creation of a statutory species of property protected by the action against infringement, and in turning the property to valuable account by licensing or assignment. ...

   (3) The particular purpose of Part 9, within which s 101 falls, is to provide for the removal of unused trade marks from the Register. It is designed to protect the integrity of the Register and in that way the interests of consumers. At the same time, it seeks to accommodate, where reasonable to do so, the interests of registered trade mark owners. Accordingly, the Court must be positively satisfied that it is reasonable that the trade mark should not be removed. The onus in this respect lies on the trade mark owner to persuade the Court that it is reasonable to exercise the discretion in favour of the owner. ...

   (4) The discretion in s 101(3) is expressed in the present tense. It requires consideration of whether, at the time that the Court is called upon to make its decision, it is reasonable not to remove the mark.

   (5) The range of factors considered in the exercise of the discretion has included whether or not:

   (a) there has been abandonment of the mark;

   (b) the registered proprietor of the mark still has a residual reputation in the mark;

   (c) there have been sales by the registered owner of the mark of the goods for which removal was sought since the relevant period ended;

   (d) the applicant for removal had entered the market in knowledge of the registered mark;

   (e) the registered proprietors were aware of the applicant’s sales under the mark;

   (f) A further factor, explicitly noted in s 101(4), but which falls within the scope of the discretion in s 101(3), is whether or not the trade mark under consideration has been used by its registered owner in respect of similar goods or closely related services.[22]

   [22] [2021] FCAFC 128, [153] (Jagot, Nicholas and Burley JJ) (citations omitted).

3. The SGP claims that ‘the sales of MIKI watches have been impacted in recent year by COVID and associated supply challenges, and also, more recently, by legislation requirements regarding testing and labelling of button batteries in watches’. Wrobel also asserts that the Removal Opponent intends to use the Trade Mark in relation to the Removal Goods and for toys. The Removal Opponent provides no further information and little corroborating evidence about the impacts of any of these circumstances and events. There is no evidence for these other than general statements. The Removal Opponent refers to retail sales extrapolated from wholesale sales for cosmetics bearing the Trade Mark as being a substantial number and submits I should consider its reputation in that regard. The evidence in this regard also does not go beyond general statements and nothing in the evidence corroborates that level of sales. I do not consider that toys, cosmetics and watches are similar. Overall, I am not satisfied that confusion is likely to follow if I refuse to exercise the discretion in relation to the Trade Mark. I am otherwise also conscious of the public interest in the Register reflecting what is being used by traders and mindful that the Removal Opponent has the onus in this matter to rebut the allegation of non-use and establish that the discretion should be exercised. Overall, the Removal Opponent does not provide a compelling reason for the Trade Mark to remain on the Register for the Removal Goods.

4. Balancing the relevant considerations and noting all of the evidence, I am not satisfied that it is reasonable to exercise the discretion not to remove the Trade Mark for any of the Removal Goods.

Decision

1. The Removal Opponent has not rebutted the allegation of non-use in respect of the Trade Mark and I am not satisfied it is reasonable to exercise the discretion to allow the Trade Mark to remain on the Register.

2. I direct that one month from the date of this decision registered trade mark 1075626 be removed from the Register.

3. If the Registrar is served with a notice of appeal within the relevant timeframe, the Trade Mark shall be treated in accordance with the decision of the court.

Costs

1. The Removal Applicant sought its costs. Costs will ordinarily follow the event. I award costs against the Removal Opponent in accordance with Schedule 8 to the Regulations.

Benjamin Goldsworthy

Hearing Officer

Oppositions and Hearings

Trade Marks and Designs

28 June 2024