Re Opposition by Mumusokr Co Ltd to registration of trade mark application 1847850 (35) - MUMUSO - in the name of Guangdong Saiman Investment Co Ltd

[2020] ATMO 74

TRADE MARKS ACT 1995

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

ReOpposition by Mumusokr Co Ltd to registration of trade mark application 1847850 (35) – MUMUSO – in the name of Guangdong Saiman Investment Co Ltd

Delegate:                 Robert Wilson

Representation:       Opponent: Self represented

Applicant: APT Patent and Trade Mark Attorneys

Decision:                   2020 ATMO 74

Trade Marks Act 1995 (Cth) - Section 52 opposition: s 62A considered – application made in bad faith – registration refused

Background

1. This decision concerns an opposition brought by Mumusokr Co Ltd (‘the Opponent’) pursuant to s 52 of the Trade Marks Act 1995 to registration of the trade mark the subject of the application detailed below in the name of Guangdong Saiman Investment Co Ltd (‘the Applicant’).

Application Number:	1847850
Filing Date:	27 May 2017
Services:	Class 35: Import-export agency services; Sales promotion for others; Procurement services for others (purchasing goods and services for other businesses); Marketing; Provision of an on-line marketplace for buyers and sellers of goods and services; Commercial administration of the licensing of the goods and services of others; Business management consultancy; Negotiation and conclusion of commercial transactions for third parties; Presentation of goods on communication media, for retail purposes; Rental of vending machines
Trade Mark:	MUMUSO	(‘the Trade Mark’)

1. Any references to sections or regulations, below, are references to sections or regulations of the Trade Marks Act 1995 (Cth) or the Trade Marks Regulations 1995 (Cth), respectively, unless otherwise indicated.

2. On 19 October 2017 the application’s acceptance for possible registration was advertised in the Australian Official Journal of Trade Marks. The Opponent filed a Notice of Intention to Oppose the registration on 18 December 2017 and a Statement of Grounds and Particulars (‘the SGP’) on 19 December 2017. The SGP nominated grounds of opposition under ss 58, 59, 60 and 62A. The Applicant filed a Notice of Intention to Defend on 13 February 2018.

   Evidence

3. The Opponent filed Evidence in Support of its opposition, being:

   ·Declaration made on 18 May 2018 by Shaojing Shen, the Business Development Manager of the Opponent, with Annexures A to I (‘Shen 1’).

4. The Applicant filed Evidence in Answer, being:

   ·Declaration made on 10 September 2018 by YE Guofu, the president of the Applicant, with Annexures YG-1 and YG-2 (‘the Ye declaration’).

5. The Opponent filed Evidence in Reply, being:

   ·Declaration made on 16 November 2018 by Shaojing Shen with Annexures A1 to D (‘Shen 2’).

6. Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing or to file written submissions. Neither party requested to be heard. Only the Applicant filed written submissions, those being prepared by the Applicant’s representatives, APT Patent and Trade Mark Attorneys.  It has fallen to me, as a delegate of the Registrar of Trade Marks, to decide the matter on the material discussed above.

   The Opponent

7. According to Shen 1, the Opponent’s first store was established in China on 24 December 2014. It is stated in Shen 2:

   [The Opponent’s] products and stores can be found in countries including but not limited to, China, Philippines, Vietnam, Russia, Australia, Cambodia, Canada, Dubai, Azerbaijan, Lebanon, Panama, Mexico, Guatemala, Turkey, United States, Indonesia, Nepal and India.

   Since its establishment in December 2014, [the Opponent] has opened over hundreds of retail outlets worldwide (more than 500).

   As the Applicant is attempting to register [the Trade Mark] in Australia, we have been forced to use the name MUMU LIFE in the interim until finalisation of the opposition. …

   Due to being forced to use MUMU LIFE in the interim, since August 2017 we have opened 2 retail stores in Sydney pending finalisation of the opposition.

8. Shen 1 indicates that the trade mark used by the Opponent is as shown below (‘the Opponent’s Trade Mark’).

The Applicant

1. According to the Ye declaration, the Applicant was founded in 2013 and its ‘principal business is operating MINISO retail stores’­. It is also declared that:

   The Applicant’s products and stores can be found in many countries, including but not limited to China, Australia, Japan, Korea, Vietnam, Malaysia, Indonesia, Singapore, Thailand, the Philippines, Saudi Arabia, Turkey, Canada, the USA.

   The Applicant’s strategy is to open retail outlets in many countries where there is a market and launch different brands selling their various categories of products. Since December 2014, around 80 retail outlets have been set up every month by the Applicant. Up to now, the Applicant has opened 893 retail outlets worldwide.

   The Applicant has opened 22 retail outlets in Australia located in Brisbane, Sydney and Melbourne. …

   The Applicant’s house brand is MINISO and is the banner of the retail stores we currently operate, and many of the products sold in the MINISO stores solely bear the MINISO brand. …

   The Applicant has plans to open and operate a second chain of retail stores under the MUMUSO banner.

   Grounds of Opposition, Onus and Standard of Proof

2. As indicated above, in the SGP the Opponent nominated grounds of opposition under ss 58, 59, 60 and 62A. To successfully oppose the registration of the Applicant’s Trade Mark, the Opponent need only establish one of those grounds. The onus of proof in an opposition rests upon the Opponent.[1] The relevant standard of proof is the ordinary civil standard based on the balance of probabilities.[2] The date at which the rights of the parties are to be determined is 27 May 2017, being the filing date of the application (‘the Relevant Date’).[3]

   Discussion

   [1] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58, [32].

   [2] Telstra Corporation Limited v Phone Directories Company Ltd [2015] FCAFC 156, [132]-[133].

   [3] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd [1954] HCA 82, [2].

   Section 62A – Application made in bad faith

3. Section 62A of the Act is reproduced below:

   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.

4. In the SGP the ground under s 62A was particularised as follows:

   The Applicant and us are competitors in this industry as we offer similar goods and services. Early this year our company decided to open its first branch in Australia in Sydney and we began preparation work such as advertising. It was after this and before we completed our preparation work that the Applicant made this application. The Applicant has knowledge that the name MUMUSO belongs to our company and it registered this trade mark with the knowledge that we have been using it worldwide and we intend to use it in Australia. We believe that the Applicant does not intend to use the trade mark but intends to interfere with our use.

5. The Explanatory Memorandum to the Trade Marks Amendment Bill 2006 provided some non-exhaustive examples of applications made in bad faith:

   • 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.

6. The case of Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) is a current leading Australian authority on s 62A. In that case, Dodds-Streeton J made the following comments:

   Clearly the court, when considering bad faith, cannot apply a purely subjective test, called by Lord Hutton ‘the Robin Hood test’. The dishonest person or one with low standards cannot be permitted to obtain trade mark registrations in circumstances where a person abiding by a reasonable standard would not. The registration of a trade mark is designed to enable bona fide proprietors to protect their proprietary rights without having to prove unfair trading. Registration is not provided to help those with low moral standards. …

   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 in bad faith by persons adopting proper standards.[4]

   [4] Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) [2012] FCA 81, [24]-[26].

7. Her Honour continued later in the same decision:

   The formulation in United Kingdom authority of bad faith as falling short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in a particular area is, in my view, an apt touchstone. An overly literal application may, however, tend to negate the relevance attributed to the applicant’s mental state in the combined test preferred in Harrison.

   Further, in my view, mere negligence, incompetence or a lack of prudence to reasonable and experienced standards would not, in themselves, suffice, as the concept of bad faith imports conduct which, irrespective of the form it takes, is of an unscrupulous, underhand or unconscientious character.[5]

   [5] Ibid [165]-[166].

8. Shen 1 indicates that the Opponent’s first store was opened in China on 24 December 2014, and that ‘since then it has been using its trade mark on its products, as the store name, and as its brand and image’. Annexure B of Shen 1 is declared to be ‘examples of the products being sold by MUMUSO’. The annexure includes photographs of a number of products in blister packs which bear prominently the Opponent’s Trade Mark.

9. Annexure C is declared to be ‘examples of the stores using the MUMUSO trade mark and opened globally’. The annexure includes photographs of what appears to be a number of retail outlets in shopping centres. The retail outlets also bear prominently the Opponent’s Trade Mark.

10. Shen 1 states that the Opponent has entered into cooperation agreements with companies in many different countries. Annexure D is declared to be, ‘photos of the execution ceremonies of the agreements and the subsequent opening of the stores’. The annexure appears to be as described and apparently shows execution ceremonies in the Philippines (on 3 February 2016), Thailand (on 3 February 2017) and Russia (on 3 March 2017).

11. Shen 1 further states that the Opponent has registered its trade mark in many different countries globally. Annexure E is declared to be, ‘examples of the registration application or certificate before [the Relevant Date]’. The annexure shows applications or registrations from jurisdictions including: the European Union (10 April 2017); International Registrations based on a Korean registration in India, Philippines, Russian Federation, Viet Nam (18 November 2016); Indonesia (7 January 2017); and, Malaysia (23 January 2017).

12. It is stated in Shen 1 that the Opponent ‘uses many social media platforms to establish its reputation worldwide’. Annexure F is declared to ‘some examples of the social media platforms used in different countries’. The annexure appears to show a number of pages from a social media platform. The pages bear prominently the Opponent’s Trade Mark and are dated from as early as 5 February 2016.

13. The Opponent’s evidence satisfies me that before the Relevant Date it had an established business with a presence in a number of countries outside of Australia. It is apparent from the evidence of both parties that they are operating in a similar market and it is highly likely that the Applicant was aware of the Opponent’s business and its use of its trade mark. Further, it is my view that the application to register, in Australia, a trade mark which is almost identical to one which is in use by a competitor in a number of foreign jurisdictions is, prima facie, an application made in bad faith. This appears, on the face of it, to be an attempt to frustrate a competitor’s expansion into Australia in a manner which is likely to be considered as unscrupulous, underhand or unconscientious by persons adopting proper standards. This situation is sufficient to warrant rebuttal by the Applicant.

14. The Applicant was on notice that a bad faith ground of opposition was one it may need to respond to; however, the Ye declaration provides no explanation of how it arrived at the trade mark or why, in the face of the Opponent’s use of its trade mark overseas, it chose to adopt an almost identical trade mark for use in Australia in connection with its proposed second chain of retail stores. Nor does the declaration state whether the Applicant was, or was not, aware of the Opponent or its use of its trade mark. These are glaring omissions.

15. The Ye declaration indicates that the Applicant ‘has applied for registration of [the Trade Mark] in many other countries around the world’. The declaration lists applications in seven countries (other than Australia). I note that the filing dates all post‑date the Relevant Date and the dates of the registrations of the Opponent provided in Annexure E to Shen 1.

16. The Applicant has made a number of submissions in respect of this ground, including:

    The evidence provided by the Opponent shows a rapidly growing business outside of Australia. …

    The evidence of the Opponent does not show what the size of the business was overseas at [the Relevant Date]. …

    Whilst the stated number of stores is large we are not given any indication of the turnover of [the Opponent’s] business now or on [the Relevant Date].

    There is no evidence that the MUMUSO Trade Mark was well known in Australia or generally in the world as at 27 May 2017.

    There is no evidence of any commercial dealings or approaches between the Applicant and Opponent, for example, there is no evidence of a pattern of behaviour in applying to register famous or prominent overseas Trade Marks in Australia by the Applicant.

    Similarly, there has been no acknowledgment by the Applicant that ownership of the Trade Mark in Australia lies with the Opponent.

    It is therefore submitted that the Opponent has not made out its case that the opposed application has been made in bad faith.

17. Although potentially relevant factors, it is not a requirement of bad faith that the Opponent establish: that its trade mark acquired a reputation either overseas or in Australia; it is the owner of the trade mark in Australia; or, there were prior dealings between the parties. The touchstone for this ground is that in applying to register the Trade Mark, the Opponent has acted in a manner which is unscrupulous, underhand or unconscientious in character. In the absence of any explanation as to how it arrived at the Trade Mark and/or why it chose to apply to register the Trade Mark in the face of the Opponent’s Trade Mark and its use overseas, I am satisfied that, in the circumstances surrounding this matter, the application to register the Trade Mark was made in bad faith. This ground of opposition is therefore established.

    Decision

18. Section 55 relevantly provides:

    55Decision

    (1)Unless subsection (3) applies to the proceedings, 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.

19. I have found the Opponent has established the ground of opposition it raised pursuant to s 62A. As the Delegate of the Registrar I accordingly refuse to register the Trade Mark.

    Costs

20. As the successful party, the Opponent is entitled to its costs and I accordingly award costs against the Applicant under s 221 in line with the amounts in Schedule 8 of the Trade Mark Regulations 1995 (Cth).

    Robert Wilson
    Hearing Officer
    Delegate of the Registrar of Trade Marks
    5 May 2020