Re: Opposition by Horizons (Asia) Pty Ltd to application under s 92 of the Trade Marks Act 1995 (Cth) by Enagic Co., Ltd to remove trade mark number 1280502 (classes 11 and 32) - Kangen - in the name of..
[2020] ATMO 181
•24 November 2020
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re:Opposition by Horizons (Asia) Pty Ltd to application under s 92 of the Trade Marks Act 1995 (Cth) by Enagic Co., Ltd to remove trade mark number 1280502 (classes 11 and 32) - KANGEN - in the name of Horizons (Asia) Pty Ltd.
Delegate: | Louise Tuohy |
Representation: | Opponent: Ng Lee for Horizons (Asia) Pty Ltd Applicant: Jacqueline Chelebian of Spruson & Ferguson, Patent and Trade Mark Attorneys |
Decision: | 2020 ATMO 181 Trade Marks Act 1995 (Cth) – removal application under ss 92(4)(a) and 92(4)(b) in respect of all goods – application successful; trade mark will be removed from Register. |
Background
Horizons (Asia) Pty Ltd (‘the Removal Opponent’) is the registered owner of the following trade mark:
Registration Number: 1280502
Trade Mark: KANGEN (‘the Trade Mark’)
Specification: Class 11: Apparatus for lighting, heating, cooking, refrigerating, drying, ventilating; apparatus for sanitary purposes excluding apparatus for water filtration; apparatus for purifying air, namely an air ioniser
Class 32: Beers, waters including mineral water, aerated water and ionized water, other non-alcoholic drinks, fruit drinks and fruit juices, syrups and other preparations for making beverages (collectively the ‘Goods’)
Enagic Co., Ltd (‘the Removal Applicant’) applied on 30 July 2018 under the provisions of ss 92(4)(a) and 92(4)(b) of the Trade Marks Act 1995 (‘the Act’) seeking removal of the Trade Mark from the Register for non-use. The removal application was made in respect of all of the Goods for which the Trade Mark is registered.
On 9 October 2018 the Removal Opponent filed a Notice of Intention to Oppose removal of the Trade Mark, followed by a Statement of Grounds and Particulars (‘the SGP’) on 8 November 2018.
On 4 December 2018, the Removal Applicant filed a Notice of Intention to Defend the removal application.
The parties filed the following evidence within the specified time frames:
Evidence in Support
Declaration by Ng Lee, consultant and administrator for the Removal Opponent, made on 25 June 2019 with Exhibits HA-A to HA-L (‘Ng1’).
The Removal Applicant did not file any evidence.
The Removal Opponent requested a hearing on 1 November 2019 and after a deferment of the hearing scheduled for 6 May 2020, I heard the matter on 8 October 2020 in Canberra, with both parties appearing by way of telephone conference link.
Ng Lee wrote a submission for the Removal Opponent (‘Removal Opponent’s written submission’) and spoke at the hearing on its behalf. Khajaque Kortian and Jacqueline Chelebian of Spruson & Ferguson Patent and Trade Mark Attorneys wrote a submission for the Removal Applicant (‘Removal Applicant’s written submission’) and Jacqueline Chelebian spoke at the hearing on its behalf.
Preliminary Matters
On 24 September 2020 the Removal Opponent filed a second declaration made by Ng Lee on 23 September 2020 with Exhibits HA-M to HA-N (‘Ng2’) and on 6 October 2020 filed a written submission by Ng Lee (‘Removal Opponent’s written submission 2’). Neither of these documents have been filed in accordance with the timeframes set out in regs 5.14 and 5.17 of the Trade Marks Regulations 1995 (‘the Regulations’)[1] for filing evidence or directions for submissions.
[1] Regs 5.14 and 5.17 of the Trade Mark Regulations 1995.
In the written submission the Removal Opponent pointed out that the Registrar and her delegate are empowered with discretion to consider any and all evidence reasonably submitted in an opposition hearing.[2]
[2] Removal Opponent’s written submission 2, 2.
In response I note that in some circumstances it may be appropriate for a delegate to consider material that is filed out of time. As the delegate, I am not bound by the rules of evidence but may be informed on any matter in a way that I reasonably believe to be appropriate[3] and/or may take into account information available to me that is relevant subject to the parties having been provided with this information and having a reasonable opportunity to make representations about the information.[4] The application of these provisions is discretionary and a party cannot compel the Registrar or her delegate in this regard.
[3] Reg. 21.15(4) of the Trade Mark Regulations 1995.
[4] Reg. 21.19 of the Trade Mark Regulations 1995.
At the commencement of the hearing the Removal Opponent and the Removal Applicant were given the opportunity to be heard on this matter.
The Removal Opponent argued that the Exhibits in Ng2 are not new evidence and are unredacted copies of evidence properly filed with Ng1.
The Exhibits filed under HA-M in Ng2 include a copy of a Notice to produce a document in a pleading or affidavit, a letter from Spruson & Ferguson addressed to the Federal Court of Australia, copies of two court filing receipts, a copy of an invoice dated 5.01.2009, and a copy of a letter from Hung Fung Trading Company (date and time stamped 14.04.14 21:50), and no such documents appear in Ng 1. Exhibit HA-N in Ng2 contains unredacted copies of the commercial and standard invoices which appear in redacted form in Ng1 under Exhibits HA-I and HA-J.
In relation to the written submission the Removal Opponent claimed it wished to reply to the arguments set out in the Removal Applicant’s written submission because the Removal Applicant had not filed any evidence in the opposition.
The Removal Applicant responded by stating that it did not object to the inclusion of the unredacted copies of evidence under Exhibit HA-N in Ng2. However, it objected to the consideration of the evidence at pages 9 to 11 in Exhibit HA-M of Ng2 which were not filed in Ng1 and also to the written submission.
Having considered the parties arguments, I am satisfied that the unredacted invoices in Ng1 now appearing in Ng2 under Exhibit HA-N should be considered in these proceedings, because these invoices are not additional evidence and I can make a more informed decision on the relevant evidence which is visible in Ng 2 under Exhibit HA-N. However, I am not satisfied that a compelling case has been made for the inclusion of the evidence filed in Ng2 under Exhibit HA-M or the written submission. In particular, I note that if this material, had been admitted, it would have had no impact on my ultimate decision in this matter.
Legal Framework
Part 9 of the Act deals with removal of trade marks from the Register due to non-use.
Section 92(4) of the Act relatively 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:
(a) that, on the day on which the application for the registration of the trade mark was filed, the applicant for registration had no intention in good faith:
(i) to use the trade mark in Australia; or
(ii) to authorise the use of the trade mark in Australia; or
(iii) 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 to which the non‑use application relates and that the registered owner:
(iv) has not used the trade mark in Australia; or
(v) has not used the trade mark in good faith in Australia;
in relation to those goods and/or services at any time before the period of one month ending on the day on which the non‑use application is filed;
(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.
[…]
Pursuant to s 100(1) of the Act, the Removal Opponent bears the onus of rebutting an allegation made under s 92(4)(a) or s 92(4)(b). Although distinct and alternative grounds, the Removal Opponent can rebut both by establishing that it used the Trade Mark in good faith in relation to the registered goods in the relevant period.[5]
[5] The Act, s 100(2)(a) and s 100(3)(a).
For the purposes of s 92(4)(a) the relevant period is any time before 30 June 2018. For the purposes of s 92(4)(b) the relevant period is the three-year period ending on 30 June 2018.
The burden of proof is the ordinary civil standard of the balance of probabilities[6].
[6] Pfizer Products Inc. v Karam [2006] FCA 1663 and more recently: Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156.
In accordance with s 101 of the Act, I may decide to remove the Trade Mark from the Register in respect of any or all of the Goods identified in the removal application, or if satisfied it is reasonable to do so, decide not to remove the Trade Mark from the Register.
In the SGP the Removal Opponent particularises its rebuttal of the ss 92(4)(a) and 92(4)(b) grounds as follows:
The trade mark concerned, KANGEN, abbreviated from the wording “KANG-GEN”, is an invented, phonetic adoption of two characters in Chinese language, has no meaning in English language and its equivalent has no meaning in a foreign language. The Opponent has, in good faith, first used the KANGEN trade mark in Australia in at least as early as 10 January 2009 and has continuously used it to the present, in respect of the designated goods and/or services. The Opponent’s use of the trade mark include but is not limited to the application of the trade mark directly onto the goods and/or services to serve the purpose of brand identification, prominent display of the trade mark in product packaging, advertising materials and digital media, as well as point of sale product display. The Opponent has continuously engaged in the marketing and selling of the KANGEN branded goods via its sales and distribution channels to customers in Australia and overseas. The Opponent has authorised use of the trade mark in Australia for goods to be sold to customers in Australia and also selected export markets. Over the years, the Opponent has continuously used and maintained the trade mark in business name and domain name registrations and renewals, as well as the trade mark registration renewal, and web development etc. for the purposes of ongoing promotion of the KANGEN brand name and badge of origin as being sourced from the Opponent in respect of the designated goods and/or services. An obviously the continuance of such market exposure has incurred financial costs to the Opponent.
The Applicant of the present removal is known to the Opponent as the then defeated “opponent” of a lengthy opposition proceedings in 2010-2014, in opposition to the registration of the Opponent’s KANGEN trade mark.
The Opponent rebuts any allegations of non use made under section 92(4)(a) and 92(4)(b) of the Trade Marks Act 1995.
Before proceeding I note that s 92(4)(a) merges with s 92(4)(b) once an impugned trade mark has been registered for five years.[7] As the Trade Mark had been registered for a period longer than five years at the date of the application for removal it is necessary only for me to consider the application for removal under s 92(4)(b).
[7] Shanahan’s Australian Law of Trade Marks and Passing Off (Lawbook Co., 6th Ed, 2016) [70.510].
Use of the Trade Mark in the Relevant Period
In order to successfully rebut an allegation under s 92(4)(b) of the Act, it is essential the Removal Opponent demonstrates that it used the Trade Mark in good faith in Australia in relation to the Goods during the relevant period. In Woolly Bull Enterprises Pty Ltd v Reynolds,[8] Drummond J observed that the expression ‘use in good faith’ has a well understood meaning in terms of s 92 of the Act, namely ‘real’, as opposed to token, use in a commercial sense. In relation to the type of evidence that would be sufficient to establish trade mark use, ‘the tribunal may not be persuaded by evidence that is solely from the internal files of the opponent’[9] or of a circumstantial nature,[10] although one invoice, if genuine, will suffice.[11] Little weight is to be given to assertions of use which are not supported by documentary evidence.[12]
[8] Woolly Bull Enterprises Pty Ltd v Reynolds [2001] 107 FCR 166, [153-154].
[9] Re Nodoz Trade Mark [1962] RPC 1.
[10] Trina Trade Mark [1977] RPC 131.
[11] Prosimmon Golf (Aust) Pty Ltd v Dunlop Australia Ltd (1987) 9 IPR 425; Geo W McPherson Nominees Pty Ltd. v Remington Arms Co. Inc. (1999) 47 IPR 636.
[12] Great White Shark Enterprises Inc v Joose Apparel Pty Ltd [1998] ATMO 8.
In confining the evidence to Exhibits dated within the relevant period, Exhibit HA-J in Ng1 and the unredacted version in Ng2 under Exhibit HA-N includes copies of commercial invoices dated during the relevant period in the name of Kangen Air & Water Technologies Australia – Division of Horizons (Asia) Pty Ltd as follows:
Commercial invoice dated 28.10.2015, for Kangen Natural Alkaline Water
Commercial invoice dated 13.06.2016, for Kangen Air Ioniser
Commercial invoice dated 10.08.2016, for Kangen Natural Alkaline Water
Commercial invoice dated 8.02.2017, for Kangen Natural Alkaline Water[13]
[13] Ng1, 23 [Exhibit HA-J], Ng2, 7 [Exhibit HA-N].
Exhibit HA-J in Ng1 and the unredacted version in Ng2 under Exhibit HA-N also includes copies of standard invoices dated during the relevant period in the name of Water Online as follows:
Invoice from 30.05.2017 for Kangen Water 600ml and 10 Litres
Invoice from 17.06.2017 for Kangen Water 600ml
Invoice from 22.07.2017 for Kangen Water10 Litres
Invoice from 13.09.2017 for Kangen Water 600ml
Invoice from 21.10.2017 for Kangen Water 600ml
Invoice from 13.11.2017 for Kangen Water 600ml
Invoice from 30.11.2017 for Kangen Water 600ml
Invoice from 8.01.2018 for Kangen Water 600ml
Invoice from 22.02.2018 for Kangen Water 600ml
Invoice from 21.03.2018 for Kangen Water 600ml
Invoice from 20.04.2018 for Kangen Water 600ml[14]
[14] Ng1, 23 [Exhibit HA-J], Ng2, 7 [Exhibit HA-N].
Exhibit HA-K in Ng1 contains copies of the search results from three Google searches dated 8.07.2017 for the words ‘KANGEN BRAND 600ml’; for images of ‘KANGEN BRAND 600ml’; and the words ‘KANGEN BRAND WATERONLINE’. The search results show excerpts from only one website targeting Australian consumers <wateronline.net.au> and lists Kangen 600ml water products available to be ordered.[15]
[15] Ng1, 26 [Exhibit HA-K].
None of the invoices or website extracts detailed in paragraphs above are in the name of the Removal Opponent. In Ng1 the Removal Opponent states that it has, on a selective and quality monitored basis, granted use of the Trade Mark to its affiliated businesses in Australia, Kangen Air & Water Technologies Australia and Water Online Australia.[16]
[16] Ng1, 24. See also Ng1 [Exhibit HA-H].
In this regard, Note 1 to s 100 of the Act states that if the registered owner of a trade mark has authorised another person to use it, any authorised use of the trade mark by that other person is taken to be a use of the trade mark by the registered owner.
Section 8 of the Act defines an ‘authorised user’ and ‘authorised use’ as follows:
8 Definitions of authorised user and authorised use
(1) A person is an authorised user of a trade mark if the person uses the trade mark in relation to goods or services under the control of the owner of the trade mark.
(2) The use of a trade mark by an authorised user of the trade mark is an authorised use of the trade mark to the extent only that the user uses the trade mark under the control of the owner of the trade mark.
(3) If the owner of a trade mark exercises quality control over goods or services:
(a) dealt with or provided in the course of trade by another person; and
(b) in relation to which the trade mark is used;
the other person is taken, for the purposes of subsection (1), to use the trade mark in relation to the goods or services under the control of the owner.
(4) If:
(a) a person deals with or provides, in the course of trade, goods or services in relation to which a trade mark is used; and
(b) the owner of the trade mark exercises financial control over the other person’s relevant trading activities;
the other person is taken, for the purposes of subsection (1), to use the trade mark in relation to the goods or services under the control of the owner.
(5) Subsections (3) and (4) do not limit the meaning of the expression under the control of in subsections (1) and (2).
Section 8 of the Act makes clear that use of a registered trade mark by an authorised user, will only be taken to be use by the registered proprietor of the trade mark if the registered proprietor exercises control over the use of the trade mark during the period in question so as to maintain a connection in the course of trade between the goods and the registered proprietor. That can be achieved if either quality control or financial control is exercised.[17]
[17] See Ceramiche Caesar S.p.A v Caesarstone Ltd [2020] FCAFC 124; Trident Seafoods Corporation v Trident Foods Pty Ltd [2019] FCAFC 100; and Lodestar Anstalt v Campari America LLC (No 2) [2016] FCAFC 92.
While the Removal Opponent stated that it has on a selective and quality monitored basis, granted use of the Trade Mark to the businesses shown on the invoices, I have not been provided with supporting evidence of either quality control or financial control being exercised over the use of the Trade Mark during the relevant period. Accordingly, I am satisfied the Removal Opponent has not established use of the Trade Mark in the relevant period.
Obstacle to Use
The Removal Opponent does not claim nor does the evidence raise matters which could be regarded as obstacles to use of the Trade Mark in the relevant period, pursuant to s 100(3)(c) of the Act.
The ground for removal under sub-s 92(4)(b) of the Act has been established.
Registrar’s discretion
Section 101 of the Act relatively provides:
101 Determination of opposed application – general
[…]
(3) If satisfied that it is reasonable to do so, the Registrar or the court may decide that the trade mark should not be removed from the Register even if the grounds on which the application was made have been established.
[…]
The Removal Opponent bears the onus of satisfying the Registrar that the discretion under section 101(3) ought to be exercised in its favour.[18]
[18] Optical 88 Ltd v Optical 88 Pty Ltd (No 2) [2010] FCA 1380, [273].
The question to be asked is whether it is reasonable not to remove the Trade Mark in respect of the Goods, even though the Removal Opponent did not establish that it had used the Trade Mark in relation to the Goods.[19]
[19] Austin, Nichols & Co Inc v Lodestar Anstalt [2012] FCAFC 8, [28].
The delegate in CUB Pty Ltd v Elixir Signature Pty Ltd[20] found the following factors which have been referred to by members of the judiciary in a number of removal decisions, including by Flick J in Gallo who considered them to be of assistance in considering the exercise of the discretion:
·there had been no abandonment of the trade mark;
·the registered proprietors of the mark still had a residual reputation in the mark;
·there had been sales by the registered proprietors of goods for which removal was sought since the relevant period ended;
·the applicants for removal had entered the market without having taken steps to ascertain from the Register whether anyone had a right to exclude their use of the mark; and
·the registered proprietors were not aware of the applicant’s sales under the mark.
[20] CUB Pty Ltd v Elixir Signature Pty Ltd [2013] ATMO 74.
The Removal Opponent argues that it has spent years of efforts in building and promoting a brand name being the registered Trade Mark in Australia,[21] and stressed in the hearing that it had not abandoned the Trade Mark.
[21] Opponent’s written submission 21-22.
The Trade Mark has been registered since 10 January 2009 and outside of the Removal Opponent’s predecessor’s initial promotional and marketing expenditure made in 2012,[22] the Removal Opponent has failed to establish sales or promotion of the Goods outside the relevant period, or a residual reputation resulting from use of the Trade Mark in relation to the Goods in the Australian market outside that time.
[22] Ng1, 28.
Whilst acknowledging the broad discretion available under s 101(3) of the Act, having considered all the claims and material before me, and in the absence of any detailed submissions or persuasive evidence from the Removal Opponent in this regard, I am satisfied that it is in the public interest for the Trade Mark to be removed from the Register in respect of the Goods.
Decision
I find the Removal Opponent has not rebutted the allegation of non-use. I direct that trade mark registration 1280502 be removed from the Register in respect of all goods to which the registration applies, one month from the date of this decision. In the event of an appeal, I direct that the Trade Mark will not be removed until the appeal has been discontinued or, in the event of a decision from the Court, that the Trade Mark be subject to that order.
Costs
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 Removal Opponent as allowed by Schedule 8 of the Regulations.
Louise Tuohy
Hearing Officer
Oppositions and Hearings
Trade Marks and Designs
24 November 2020
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