Q Dance Australia Pty Ltd v Avant Media Pty Ltd
[2011] ATMO 56
•29 June 2011
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re:Opposition by Q Dance Australia Pty Ltd to registration of trade mark application 1181572 (41) - DEFQON; DEFQON1; DEFQON01 - filed in the name of Avant Media Pty Ltd.
Delegate: Heath Wilson Representation: Opponent: Hamish Bevan of Counsel instructed by Bartier Perry, Lawyers.
Applicant: Self represented.Decision: 2011 ATMO 56
Section 52: Grounds under s58, 59, 60, 42(b) and 62A – lack of intention to use the trade mark applied for - Registration refused – costs awarded against the applicant.Background
On 14 June 2007, a company named NEE Culture Pty Ltd applied to register the following series of trade marks:
defcon; defqon; defkon; defqon1; defcon1; defqon01; defqon.01; defcon.01
Class 41: Advisory services relating to the organisation of sporting events; arranging of sporting events; event management services (organization of educational, entertainment, sporting or cultural events); handicapping or seeding of sports events; master of ceremony services for parties and special events; organisation of ceremonial events; organisation of entertainment events; organisation of musical events; organisation of sporting events; organisation of vehicle racing events; organising events for cultural purposes; organising events for entertainment purposes; organising of entertainment and social events; organising of equestrian events; production of sporting events; providing facilities for sports events; provision of recreational events; provision of sporting events; rental of equipment for use at sporting events; timing of sports events; wine tasting events
During examination, the above trade marks were found not to constitute a valid series under section 51 of the Trade Marks Act 1995 (‘the Act’). Consequently, the Examiner gave NEE Culture Pty Ltd the option of selecting either ‘defcon and defcon1’ OR ‘defqon, defqon1 and defqon01’ as its series of trade marks. It chose the latter option, and trade mark application no. 1181572 was amended to:
defqon; defqon1; defqon01
(‘the Trade Mark’)
On 30 July 2009, Mr Ivan Zozulya acting as director of Defcon Music Festival Pty Ltd (formerly NEE Culture Pty Ltd), assigned the ownership of the Trade Mark to Avant Media Pty Ltd (‘the Applicant’).
I also note that the Applicant had previously applied to register the trade mark “defcon” (application no. 1247953) on 24 June 2008 for similar services as the Trade Mark. However, application no. 1247953 has since lapsed and been advertised accordingly on 28 January 2010. At the hearing, Mr Zozulya commented that he was oblivious to the lapsing of this trade mark.
The Trade Mark was advertised as accepted in the Australian Official Journal of Trade Marks on 8 May 2008. On 6 August 2008, Q Dance Australia Pty Limited (‘the Opponent’) filed a notice of opposition to its registration. The initial opposition grounds were under sections 41, 43, 58, 59, and 60 of the Act. However, the notice of opposition was subsequently amended to include a ‘Bad faith’ ground under section 62A and a ‘contrary to law’ ground under section 42(b).
The Opponent filed the following evidence in support:
·Declaration of Simon Coffey dated 18 May 2009 with exhibits SC-1 to SC-4.
·Declaration of Shane Box dated 16 May 2009 with exhibit SB-1.
·Declaration of Jeremy Leitch dated 17 May 2009 with exhibit JL-1.
·Declaration of Jonas Schmidt dated 28 May 2009 with exhibits JS1-112.
As evidence in answer, Mr Zozulya filed his own statutory declaration dated 5 January 2010 and attaching exhibits IZ-1 and IZ-2. No other evidence was filed by either party.
Following an exchange of written submissions between the parties, I heard this matter as a delegate of the Registrar of Trade Marks on 19 April 2011 in Canberra. Mr Zozulya appeared on behalf of the Applicant and Hamish Bevan of Counsel instructed by Bartier Perry Lawyers appeared for the Opponent.
The Opponent pressed grounds of opposition under sections 58, 59, 60, 42(b) and 62A and the Opponent bears the onus of establishing at least one of these grounds on the balance of probabilities.[1]
Reasons
[1] Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891 at [22] to [26].
Section 58: Applicant 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.
To succeed under section 58 of the Act, the Opponent must identify another trade mark which is at least ‘substantially identical’[2] to the Trade Mark and has been used in Australia (prior to 14 June 2007) on goods or services that are ‘the same kind of thing’[3] as the Applicant’s services.
[2] Carnival Cruise Lines Inc v Sitmar Cruises Ltd [1994] FCA 936; (1994) 120 ALR 495
[3] Re Hicks' Trade Mark (1897) 22 VLR 636.
In March 2003 the Opponent began promoting an annual military themed dance music festival named DEFQON.1 in the Netherlands. Following each of these international festivals, a popular song was selected and given the title of ‘Defqon.1 Anthem’. The 2005, 2006 and 2007 ‘Defqon.1 Anthems’ were later sold around the world including in Australia. The Applicant, on the other hand, did not use the Trade Mark prior to 14 June 2007, but has used DEFCON as the name of its Australian music festival in the years following that date.
The Opponent clearly uses an identical or a substantially identical trade mark to the Applicant’s Trade Mark. The issue is whether the Opponent has established a definitive instance of use of the Trade Mark in Australia. The Opponent does not need to establish a reputation in its trade mark to succeed under this ground. A single instance of genuine or bona fide use will suffice to establish that the Applicant is not the owner of the trade mark, but it should be accompanied with “if not conclusive proof, at any rate overwhelmingly convincing proof.” [4]
[4] ‘Nodoz’ Trade Mark [1962] RPC 1 (Ch D).
The Opponent has not held or actively advertised a DEFQON.1 dance music festival in Australia before 14 June 2007. Despite this fact, it appears that the knowledge and reputation of the Opponent’s trade mark attained overseas has preceded its first use in Australia. In particular, Mr Simon Coffey (Director of the Opponent) mentions requests to play DEFQON.1 Anthems in Australian nightclubs, and discussion topics and general use of the word DEFQON’ ‘on Internet forums based in Australia and overseas (where Australian users have made contributions).
Despite the Opponent’s assertions, discussion of DEFQON Anthems or Festivals by Australian internet users does not convincingly demonstrate use of the trade mark in the ‘course of trade.’ It does not amount to actual trade or an offer to trade in the goods on the Opponent’s part. In order to demonstrate the use of a trade mark in Australia, it is not sufficient to indicate that goods (such as ‘Defcon.1 Anthems’) were simply available for order on a website that was accessible to Australians.[5] In Ward Group Pty Ltd v Brodie & Stone Plc[6], Merkel J stated that:
…use of a trade mark on the Internet, uploaded on a website outside of Australia, without more, is not a use by the website proprietor of the mark in each jurisdiction where the mark is downloaded. However, as explained above, if there is evidence that the use was specifically intended to be made in, or directed or targeted at, a particular jurisdiction then there is likely to be a use in that jurisdiction when the mark is downloaded.
[5] See Habitat Holding BV v KMM Enterprises Pty Ltd (2007) 74 IPR 415 at 421.
[6] Ward Group Pty Ltd v Brodie & Stone Plc [2005] FCA 471 per Merkel J.
The stronger evidence of use consists of music sales of the DEFQON.1 Anthems on vinyl and in MP3 format over the Internet. There is evidence of vinyl imports of the Opponent’s Anthems (2005, 2006 and 2007) to Australia and number of digital copies of the 2005 and 2006 Anthem were also sold to Australian users.
The Leitch declaration supplements the above evidence with regard to sales. Mr Leitch was an Australian distributor of the DEFQON.1 Anthems and director of Vinyl Warning Pty Ltd. He attests to, and provides electronic records of sales of the Opponent’s 2005 and 2006 Anthems in Australia prior to 14 June 2007. The use of the ‘DEFQON.1’ trade mark on the 2005 album cover[7] is not as prominent as it is on the 2006 Anthem and the sales of the 2007 Anthem occur after the priority date. Despite the submissions from Mr Zozulya to the contrary, I find no reason to doubt the veracity of those documents.
[7] See Musidor Bv v Robert William Tansing [1994] FCA 1242; (1994) 29 IPR 20.
The use of the Opponent’s trade mark in Australia is therefore slight and limited to music recordings which must be determined as the ‘same kind of thing’ as the Applicant’s services for this ground to succeed. The ‘same kind of thing’ is generally a narrower comparison than ‘closely related’ goods and services. While some of the applicant’s services are clearly different to musical recordings, those services with a closer relationship include:
Organisation of entertainment events; organisation of musical events; organising events for entertainment purposes; organising of entertainment and social events
Taking into account the nature, use and trade channels of the respective goods and services, the organisation of musical or entertainment events is unlikely to involve the sale of musical recordings. Even if it did, this possibility does not make those goods and services the ‘same kind of thing’. By way of analogy, in Hoyts Corporation Pty Ltd[8] the Hearing Officer decided that the `service of providing refreshments' was not ‘the same kind of thing' as the goods of ‘Coffee, tea, confectionery, ices, ice, non-alcoholic drinks’. As a result, I find that the Opponent has not discharged the onus of establishing a prior bona fide use of its trade mark in Australia on the same kind of thing as the Applicant’s services. On the balance of probabilities, section 58 has not been established.
[8] Hoyts Corporation Pty Ltd v Hoyt Food Manufacturing Industries Pty Ltd (2003) 61 IPR 334.
Section 59: Applicant not intending to use trade mark
The registration of a trade mark may be opposed on the ground that the applicant does not intend:
(a) to use, or authorise the use of, the trade mark in Australia; or
(b) to assign the trade mark to a body corporate for use by the body corporate in Australia;
in relation to the goods and/or services specified in the application.
Note: For applicant see section 6.
It has been affirmed by the Full Bench of the Federal Court in Food Channel[9] that an intention to use a trade mark is determined at the date of filing the application. For the current matter, the relevant date is 14 June 2007. However, it is also established law that “use (or non use) after the date of application may be relevant in drawing inferences as to the issue of intention as at the date of application.”[10]
[9] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58.
[10] Food Channel Network (Supra) [at 74].
The evidence of post-filing use by the Applicant is solely limited the use of ‘DEFCON’ rather than use of the Trade Mark. By itself, the use of DEFCON as a trade mark is not sufficient to infer a lack of intention to use the Trade Mark. However, Mr Zozulya also made the following declaration as to the Applicant’s intention in filing for the registration of the Trade Mark (emphasis added):
The DEFQON mark was registered (sic) to provide protection of the Applicants brand “DEFCON”. At the time of registration I was aware of Q-Dance and their DEFQON mark used in Netherland and believed there could be a problem if two marks were being used in Australia. Therefore, the Applicant would like to register the DEFQON mark purely to protect its own brand.
Statements by the Applicant may be enough to infer a lack of intention under section 59; especially where those statements indicate that the trade mark has been filed for purely defensive or tactical reasons. This was considered in Rolewa Rentals Pty Ltd v Champagne Moet et Chandon[11] which referred to “a real resolve, intention and purpose” to use the trade mark. As the Applicant intended to use another trade mark (albeit a substantially identical one), that ‘resolved purpose’ to use the Trade Mark is absent. To avoid doubt, these are not circumstances where an applicant has applied for a number of trade marks with the intention to use some of them but not having yet decided which ones.[12]
[11] Rolewa Rentals Pty Ltd v Champagne Moet et Chandon (1985) 5 IPR 71 and see Ducker's Trade Mark (1928) 45 RPC 397 at 402.
[12] Aston v Harlee Manufacturing Co (1960) 103 CLR 391 at 401.
The Applicant has made it clear that the intention at the time of filing was not to use the Trade Mark, but to protect his ‘DEFCON’ trade mark, presumably from the Opponent using the trade mark DEFQON in Australia. Mr Zozulya reiterated the above intention at the hearing and requested that if the Trade Mark was refused, his other DEFCON trade mark 1247953 should in the alternative impede the registration of the Opponent’s trade mark(s). However, as mentioned earlier, trade mark no. 1247953 has now lapsed. While there are a number of potential outcomes in relation to the Opponent’s later filed DEFQON trade marks, they are not relevant considerations at this time. The overriding question remains whether the Opponent has established a ground of opposition in relation to the Trade Mark.
By the Applicant’s own admission and by its subsequent actions indicating use only in relation to a DEFCON festival, I find that there is a lack of intention to use the Trade Mark. This is further reinforced by the fact that the Applicant had the option of selecting its own adopted trade mark (‘DEFCON’) at the examination stage and instead chose to proceed with a trade mark identical to the Opponent’s. There is no ambiguity here. The application has been filed for tactical reasons only and was not supported by any genuine intention to commence use.[13]
[13] As in Sapient Australia Pty Ltd v SAP Aktiengesellschaft (2002) 55 IPR 638.
I find that the Applicant on filing this application did not intend to use the Trade Mark applied for in Australia, and the ground of opposition under section 59 of the Act is established.
Section 60: Trade mark similar to trade mark that has acquired a reputation in Australia
The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:
(a)another trade mark had, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, acquired a reputation in Australia; and
(b)because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.
Section 42(b): Trade mark 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.
As the Opponent has approached section 60 and 42(b) of the Act concurrently, I will briefly address them in the same fashion. The ground under section 42(b) relates to an alleged contravention of section 52 of the Trade Practices 1974 (‘TPA’)[14] and whether use of the Trade Mark would amount to misleading and deceptive conduct.
[14] Or section 18 of the Australian Consumer Law.
To establish misleading and deceptive conduct, Parkdale Custom Built Furniture v Puxu[15] highlighted that it is not sufficient to establish the conduct complained of was merely confusing people or causing them to wonder whether the two products came from the same source. I must also be satisfied that the use of the Trade Mark would be contrary to law. Section 52 of the TPA therefore has a higher threshold than section 60 of the Act which requires a likelihood of deception or confusion.
[15] Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191
Under section 60, the strength of the Australian reputation in the Opponent’s ‘DEFQON’ and/or ‘DEFQON.1’ trade marks at 14 June 2007 must still be significant for Australian consumers to be deceived or confused. The Opponent submits that the reputation for its trade mark in Australia commences from July 2005. This date refers to the 2005 ‘DEFQON.1 Anthem’ appearing on the Australian website Vinyl Warning for sale in vinyl format. The Opponent’s general use is in relation to sale of a specific type of music, with the trade mark DEFQON not always being the most prominent element on the album (especially the 2005 Anthem). I have already assessed the extent of the use of the Opponent’s trade marks in Australia before the Applicant’s priority date under the section 58 ground, and noted that it was not significant.
In relation to the reputation of a trade mark overseas, Justice Lockhart in Conagra Inc v McCain Foods (Australia)[16] commented that:
It is no longer valid, if it ever was, to speak of a business having goodwill or reputation only where the business is carried on. Goods and services are often preceded by their reputation abroad. They may not be physically present in the market of a particular country, but are well known there because of the sophistication of communications which are increasingly less limited by national boundaries, and the frequent travel of residents of many countries for reasons of business, pleasure or study.
[16] Conagra Inc v McCain Foods (Australia) Pty Ltd (1992) 33 FCR 302; 23 IPR 193 (at 233-4).
Even taking into account the spillover reputation of the Opponent’s trade mark from the Netherlands and the fact that the Opponent operates in a relatively niche music market, the overall reputation in the Opponent’s trade mark did not exist on 14 June 2007 amongst a significant number of Australian consumers sufficient for the use of the Trade Mark to cause confusion.
Actual instances of confusion between the trade marks, if established, may be persuasive in a finding under section 60 of the Act and section 52 of the TPA[17]. The alleged confusion between the trade marks has occurred on an Australian internet forum website in August 2007.[18] A couple of dance music enthusiasts assumed that it was the Opponent touring Australia when it was in fact a promotion for the Applicant’s upcoming DEFCON music festival. Some of the users also assumed that ‘DEFCON’ was simply a typographical error.
[17] Parkdale Custom Built Furniture v Puxu (Supra) per Gibbs CJ at pp 198-9.
[18] Box declaration, exhibit SB-1.
Apart from that instance, Mr Zozulya wrote to the Opponent mentioning confusion amongst certain promoters. This comment was made on 25 June 2008, a year after the filing date. Mr Zozulya later attests that he was referring to the same instances as the internet forums above.[19] It is difficult to discern whether that purported confusion stems from the Opponent’s reputation or some other factor.
[19] Zozulya declaration, paragraph 52.
While there was some prior knowledge of the Opponent’s trade mark in Australia (and negligible confusion), I am not convinced that it reaches the level of reputation to enable a positive finding to be made under section 60. The Opponent has not sufficiently satisfied the first requirement under section 60, by demonstrating a reputation extant in Australia on 14 June 2007 and I find that the ground of opposition under section 60 has not been established. On these particular set of facts, it follows that the use of the Trade Mark would also not amount to misleading and deceptive conduct under section 52 of the Trade Practices Act 1974 and is therefore not contrary to law under section 42(b).
Section 62A: Application made in bad faith
The registration of a trade mark may be opposed on the ground that the application was made in bad faith.
Some examples of conduct that may constitute bad faith as envisaged under section 62A were set out in the Explanatory Memorandum[20] as follows:
·persons who monitor new property developments, register the names of new developments as trade marks for a number of services and then threaten the property developers with trade mark infringement proceedings unless the developers licence or buy the trade marks;
·persons who have a history of applying for trade marks that are deliberate misspellings of other registered trade marks;
·persons who identify trade marks used overseas but with no Australian use as yet who then apply to register the trade marks in Australia for the express purpose of selling them to the overseas owners.
[20] Explanatory Memorandum to the Trade Marks Amendment Bill 2006 (Cth)
These examples are not exhaustive. Delegates of the Registrar have decided that the relevant test for bad faith should be whether a reasonable person standing in the shoes of the applicant ought to have been aware that he should not apply for the registration of the trade mark. Similarly, the United Kingdom case of Harrison’s Trade Mark Application[21] found:
The words “bad faith” suggest a mental state. Clearly when considering the question of whether an application to register is made in bad faith all the circumstances will be relevant. However, the court must decide whether the knowledge of the applicant was such that his decision to apply for registration would be regarded as bad faith by persons adopting proper standards.
[21] Harrison’s Trade Mark Application [2005] FSR 10 [at 26]
The initial explanation provided by Mr Zozulya implies an honest adoption of the trade mark DEFCON. He explains that it is a known English word which may be used in other contexts, and is an attractive concept linked to his own military-themed dance festival. The problem with those assertions is that DEFCON is not the Trade Mark which is ‘defqon; defqon1; defqon01’, an unusual spelling and number combination unique to the Opponent’s dance festival.
Additionally, Mr Zozulya later admits that he was aware of the existence of the Opponent prior to applying for the registration of the Trade Mark. Moreover, there is evidence to suggest he was aware of the Opponent from as early as 2005.[22] He studied the local and international markets prior to applying for the Trade Mark and discovered a dance event staged by the overseas Q Dance company in the Netherlands (‘Q Dance’).
[22] See below, at paragraph 37.
Prior to filing on 4 January 2007, Mr Zozulya contacted Q Dance suggesting a potential business relationship in Australia. He says:[23]
I had a few people attend defqon in 2005 who absolutely loved the set up and the organisation and recommended that a similar idea is taken to Australia…
What I am proposing is some sort of partnership whereby we can work mutually to bring defqon to Australia.
[23] Schmidt declaration, exhibits JS1-107 to 113.
Due to the fact that Q Dance had already entered into an agreement with Mr Simon Coffey in Australia (who would become director of the Australian company), it did not respond to Mr Zozulya’s email. As no response was forthcoming, Mr Zozulya attests to his assumption that Q Dance had no intention of commencing operations in Australia. The Applicant therefore commenced to organise the event known as ‘DEFCON’ and the Trade Mark application was lodged on 14 June 2007.
Some time after filing (on 11 December 2007), Mr Zozulya again wrote to Q Dance stating inter alia:
It came to my attention that you are having plans for Australia in 2008…With our knowledge of local market and government regulations I wanted to discuss potential partnership with you.
Once again, and for the same reason as above, Q Dance or the Opponent did not respond. Mr Zozulya again wrote on 25 June 2008:
It has come to my attention that our event, DEFCON Music Festival, has produced some sort of confusion among certain promoters and now there is a degree of misrepresentation about this event.
Our event concept is closely linked to military/army theme and after a careful consideration an appropriate name of defcon was considered to be the most suitable name for the event. At no stage was there an intention of using any existing brands or cause confusion.
The reason I am writing to you to make clear there was no any ill will in our event production and we have a huge respect for Q-Dance organization. (sic)
…
Although our event vastly features house, psy, and melodic trance genres, we are interested in some of the artists on your bill. Are you able to advise if you are willing to consider our offers for your talent?
Given the above, the Applicant’s adoption of this trade mark was deliberate when viewed in conjunction with the decision to employ the uncommon spelling of ‘Defqon’. I am also of the view that Applicant’s DEFCON trade mark originates from the Opponent’s trade mark. However, knowledge of the Opponent’s trade mark is not sufficient, by itself, to establish bad faith. In Re The Registered Trade Mark "Yanx"[24], Williams J said:
To try and register in Australia a word which the applicant to the knowledge of the respondent is using elsewhere on its cigarettes is sharp business practice. But it is not in itself fraudulent or a breach of the law.
[24] Re The Registered Trade Mark "Yanx"; Ex parte Amalgamated Tobacco Corporation Ltd. [1951] HCA 28; (1951) 82 CLR 199, at p 202.
The Opponent’s evidence supporting the bad faith ground has clearly shifted the onus to the Applicant to provide an explanation. The Applicant has done so. While the Applicant was aware of the Opponent’s trade mark at the time of filing, I am satisfied that the Applicant was unaware of the Q Dance’s plan to expand its business to Australia. Taking into account all the surrounding circumstances, I am not convinced that a reasonable person standing in the shoes of the applicant ought to have known not to apply for the registration of the Trade Mark. The ground of opposition under section 62A has not been established.
Decision
Section 55(1) provides:
(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.
The Opponent has established a ground of opposition under the Act. As a result, the Applicant is unsuccessful in this matter and I refuse to register Trade Mark application no. 1181572: Defqon; Defqon1; Defqon01.
Costs
The Opponent is successful and there is no reason why costs should not follow the event, as is ordinarily the case. I award costs against the Applicant to the extent allowed under Schedule 8 of the Trade Marks Regulations 1995.
Heath Wilson
Hearing Officer
Trade Marks Hearings
29 June 2011
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