Re Oppositions by Murley Pty Ltd to registration of trade mark applications 1901398 (43) the Craft & Co Kitchen-Bar and 1901405 (43) the Craft & Co Kitchen-Bar (figurative) both in the name of The Craft & Co Pty Ltd

[2020] ATMO 2

TRADE MARKS ACT 1995

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

ReOppositions by Murley Pty Ltd to registration of trade mark applications 1901398 (43) THE CRAFT & CO Kitchen-Bar and 1901405 (43) THE CRAFT & CO Kitchen-Bar (figurative) both in the name of The Craft & Co Pty Ltd

Delegate:                 Robert Wilson

Representation:       Opponent: Self

Applicant: Williams Winter Pty Ltd

Decision:                   2020 ATMO 2

Trade Marks Act 1995 (Cth) - Section 52 oppositions: ss 41, 42(b), 43, 44, 58, 60 and 62A considered – no grounds established – trade marks may proceed to registration – no discount of costs for second opposition due to conduct of opponent

Background

1. The Craft & Co Pty Ltd (‘the Applicant’) applied to register the trade marks detailed below (‘the Applications’):

Application Number:

1901398

Filing Date:

19 January 2018

Services:

Class 43: Arranging for the provision of food; Arranging of wedding receptions (food and drink); Coffee bar and coffee house services (provision of food and drink); Consultancy services relating to food; Consultancy services relating to food preparation; Food and drink catering; Food cooking services; Food preparation; Hospitality services (food and drink); Night club services (provision of food and drink); Preparation of food and drink; Preparation of take-away and fast food; Providing food and drink; Providing information, including online, about services for providing food and drink, and temporary accommodation; Provision of carry out foods and beverages; Provision of information relating to the preparation of food and drink; Restaurant services for the provision of fast food; Snack bars (provision of food and drink); Take away food services; Take out food and beverage services; Takeaway food and drink services; Arranging for the provision of drink; Bar services; Wine bar services; Restaurant services; Restaurants; Cafe services; Cafes

(‘the Word Mark Services’)

Trade Mark:

THE CRAFT & CO Kitchen-Bar

(‘the Applicant’s Word Mark’)

Application Number:

1901405

Filing Date:

19 January 2018

Services:

Class 43: Arranging for the provision of food; Coffee bar and coffee house services (provision of food and drink); Consultancy services relating to food; Consultancy services relating to food preparation; Food cooking services; Food preparation; Hospitality services (food and drink); Night club services (provision of food and drink); Preparation of food and drink; Preparation of take-away and fast food; Providing food and drink; Providing information, including online, about services for providing food and drink, and temporary accommodation; Provision of carry out foods and beverages; Provision of information relating to the preparation of food and drink; Restaurant services for the provision of fast food; Snack bars (provision of food and drink); Take away food services; Take out food and beverage services; Takeaway food and drink services; Theatre restaurants (Provision of food and drink); Bar services; Inn keeping (bar, restaurant and accommodation); Wine bar services; Provision of information relating to restaurants; Restaurant services; Restaurants; Salad bar restaurant services; Self-service restaurants; Cafe services; Cafes

(‘the Logo Services’)

Trade Mark:

(‘the Applicant’s Logo’)

1. The Applicant’s Word Mark and the Applicant’s Logo will be referred to below, collectively, as ‘the Applicant’s Trade Marks’. The Word Mark Services and the Logo Services will be referred to collectively as ‘the Applicant’s Services’.

2. On 14 June 2018 the applications’ acceptances for possible registration were advertised in the Australian Official Journal of Trade Marks. On 14 August 2018 Murley Pty Ltd (‘the Opponent’) filed Notices of Intention to Oppose the registrations pursuant to s 52 of the Trade Marks Act 1995 (‘the Act’). The Opponent filed Statements of Grounds and Particulars (‘the SGPs’) on 14 September 2018. The SGPs nominated grounds of opposition under ss 41, 42(b), 43, 44, 58, 60 and 62A of the Act. The Applicant filed Notices of Intention to Defend the oppositions on 24 October 2018.

   Evidence

3. The Opponent filed the following Evidence in Support of its oppositions:

   ·Declaration made on 1 February 2019 by Brett Anthony Murphy, the Director of the Opponent, with Exhibits BM-1 to BM-9 (‘the Murphy declaration’).

4. The Applicant filed the following Evidence in Answer:

   ·Declaration made on 10 May 2019 by Roberto Cea, the Manager of Marketing of the Beverage Food Group, a related company of the Applicant, with Exhibits RC-1 to RC-21 (‘the Cea declaration’).

5. The Opponent did not file Evidence in Reply.

6. The Opponent was represented by Gadens Lawyers until shortly after the Applicant’s Evidence in Answer was filed. The Opponent has been self-represented since 16 July 2019.

7. Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing or to file written submissions. Since 16 July 2019 the Opponent has not responded to any correspondence from IP Australia. The Applicant requested to be heard and a hearing was scheduled for 3 December 2019; however, once it was clear that the Opponent was not going to appear at the hearing or file any written submissions the Applicant chose to rely on written submissions only. The Applicant’s submissions were prepared by Williams Winter Pty Ltd.

8. In my capacity as a delegate of the Registrar of Trade Marks I am to decide the matter and I will do so on the materials discussed in the previous paragraphs.

   The Opponent

9. According to the Murphy declaration:

   The Opponent is a registered company and was incorporated on 28 August 2014.

   The Opponent operates a hospitality business in Eltham, Victoria, under the business name ‘Craft Kitchen and Bar’ which was registered on 18 September 2017 (Business Name). The Business Name is held by The Trustee for Murley Unit Trust, who is the Opponent.

   The Opponent first used the trade mark ‘Craft Kitchen and Bar’ in connection with restaurants, bar and entertainment services in September 2017 and has continuously used the trade mark ‘Craft Kitchen and Bar’ since that time.

   The Applicant

10. According to the Cea declaration:

    The Applicant is a related company to The Beverage Good Group Pty Ltd which operates in the food and beverage industry in Australia and New Zealand.

    The Applicant is based in Preston Victoria. The Applicant was first incorporated on 19 August 2014. …

    The Applicant operates the following two hospitality businesses in Melbourne, Victoria:

    (a)390 Smith Street, Collingwood (‘the Craft & Co Collingwood’); and

    (b)170 Riverend Road, Bangholme (‘the Craft & Co Farm’). …

11. The Applicant is the owner of the following registration:

Trade Mark Number:	1700046
Filing Date:	5 June 2015
Trade Mark:	(‘the Applicant’s Earlier Logo’)

1. The Applicant’s Earlier Logo is registered in respect of a wide range of goods and services in Classes 1, 3, 9, 16, 29, 30, 32, 33, 39, 40, 41 and 43. The services for which it is registered in Class 43 are similar to the Applicant’s Services.

2. It is also stated in the Cea declaration that:

   The Applicant has used [the Applicant’s Earlier Logo] in relation to various hospitality services provided from the Craft & Co Collingwood continuously since the Applicant began trading from the venue in or about December 2015. The Craft & Co Collingwood includes a café, restaurant, bar, function space, brewery, distillery and micro-dairy. …

   The Applicant has used [the Applicant’s Earlier Logo] in relation to various hospitality services provided from the Craft & Co Farm continuously since the Applicant began trading from the venue in or about April 2016. The Craft & Co Farm includes a café, restaurant, bar and winery.

   Grounds of Opposition, Onus and Standard of Proof

3. As indicated above, in the SGP the Opponent nominated grounds of opposition under ss 41, 42(b), 43, 44, 58, 60 and 62A of the Act. 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 19 January 2018, being the filing date of the Applications (‘the Relevant Date’).[3] The Relevant Date is also the priority date for the purposes of ss 44 and 60.

   Discussion of grounds

   [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 41

4. Section 41 of the Act provides:

   41 – Trade Mark not distinguishing applicant’s goods or services

   (1)An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (the designated goods or services) from the goods or services of other persons.

   Note:      For goods of a person and services of a person see section 6.

   (2)A trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons only if either subsection (3) or (4) applies to the trade mark.

   (3)This subsection applies to a trade mark if:

   (a)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; and

   (b)the applicant has not used the trade mark before the filing date in respect of the application to such an extent that the trade mark does in fact distinguish the designated goods or services as being those of the applicant.

   (4)This subsection applies to a trade mark if:

   (a)the trade mark is, to some extent, but not sufficiently, inherently adapted to distinguish the designated goods or services from the goods or services of other persons; and

   (b)the trade mark does not and will not distinguish the designated goods or services as being those of the applicant having regard to the combined effect of the following:

   (i)the extent to which the trade mark is inherently adapted to distinguish the goods or services from the goods or services of other persons;

   (ii)the use, or intended use, of the trade mark by the applicant;

   (iii)any other circumstances.

   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: For goods of a person and services of a person see section 6.

   Note 3: 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 (5) and 7(3) and section 8).

   (5)For the purposes of this section, the use of a trade mark by a predecessor in title of an applicant for the registration of the trade mark is taken to be a use of the trade mark by the applicant.

   Note 1: For applicant and predecessor in title see section 6.

   Note 2: If a predecessor in title had authorised another person to use the trade mark, any authorised use of the trade mark by the other person is taken to be a use of the trade mark by the predecessor in title (see subsection 7(3) and section 8).

5. The Opponent particularised this ground in the SGPs in essentially identical terms, as follows:

   [The Applicant’s Trade Marks do not] distinguish the claimed services.

   The words ‘THE CRAFT & CO Kitchen-Bar’ are entirely descriptive of the Applicant's services. The word CRAFT is a generic, descriptive term used to describe small, independent, specialised or boutique providers of goods and services, and is commonly used in connection with the provision of food and beverages. Secondly, the elements ‘& CO’ refer to the generic term ‘and company’ so can therefore be discounted for the purposes of inherent registrability. Lastly, the words ‘Kitchen-Bar’ directly refer to the food and beverage services offered by the Applicant, specifically boutique food and beverage services.

   Other traders offering craft food and beverages use, and will continue to use, the words ‘craft’, ‘kitchen’ and ‘bar’ to describe the same or similar goods and services to [the Applicant’s Services]. This is because the words ‘craft’, ‘kitchen’ and ‘bar’ describe the kind, quality and intended purpose of the services. Other traders should be free to use these purely descriptive terms in the course of their business without fear of trade mark infringement.

   The addition of the device at the top of [the Applicant’s Logo] is insufficient to distinguish the mark as a whole.

6. The case law setting out the necessary considerations for determining whether a trade mark is inherently adapted to distinguish is plentiful and well established. In Registrar of Trade Marks v W & G Du Cros Ltd (‘Du Cros’), Lord Parker of Waddington said:

   The applicant’s chance of success in this respect (i.e. in distinguishing his goods by means of the mark, apart from the effects of registration) must, I think, largely depend upon whether other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connexion with their own goods.[4]

   [4] (1913) AC 624, 634-5.

7. In citing Du Cros with approval Kitto J in Clark Equipment Co v Registrar of Trade Marks stated:

   [W]hether a mark is adapted to distinguish [will] be tested by reference to  the likelihood of other persons, trading in goods of the relevant kind and being actuated only by proper motives – in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess – will think of the word and want to use it in connection with similar goods in any manner which would infringe a registered trade mark granted in respect of it.[5]

   [5] (1964) 111 CLR 511, 514.

8. The Applicant submitted the following in respect of the Applicant’s Logo:

   The allegation that [the Applicant’s Logo] lacks inherent adaptability to distinguish ought not have been pressed through to hearing. It has no reasonable prospect of success.

   The logo is dominated by a unique graphic device and THE CRAFT & CO is literally nonsensical.

   Finally, there is no evidence of other traders in the industry wanting to use this unique phraseology consisting of THE [TERM] & CO in relation to hospitality services. It is an odd and whimsical phrase if one considers ‘CRAFT’ descriptive. But here that place in the phrase is playfully filled by a term alluding to the services in a non-sensical singular manner.

   and the following in respect of the Applicant’s Word Mark:

   Save for the fact this mark does not contain a graphic device all the comments in relation to [the Applicant’s Logo] apply here.

   Hence neither of the Applicant’s Trade Marks lack inherent adaptability to distinguish.

9. I concur, on the whole, with the Applicant’s submissions and I am satisfied that the Applicant’s Trade Marks are inherently adapted to distinguish the Applicant’s Services. The Opponent has therefore failed to establish this ground of opposition.

   Section 44

10. Relevant provisions of the Act with respect to the s 44 ground are reproduced below:

    Section 44 - Identical etc. trade marks

    (1)…  

    (2)Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant's trade mark) in respect of services (applicant's services) must be rejected if:

    (a)it is substantially identical with, or deceptively similar to:

    (i)            a trade mark registered by another person in respect of similar services or closely related goods; or

    (ii)           a trade mark whose registration in respect of similar services or closely related goods is being sought by another person; and

    (b)the priority date for the registration of the applicant's trade mark in respect of the applicant's services is not earlier than the priority date for the registration of the other trade mark in respect of the similar services or closely related goods.

    Note 1: For deceptively similar see section 10.
    Note 2: For similar services see subsection 14(2).
    Note 3: For priority date see section 12.

    Note 4: The regulations may provide that an application must also be rejected if the trade mark is substantially identical with, or deceptively similar to, a protected international trade mark or a trade mark for which there is a request to extend international registration to Australia: see Part 17A.

    (3)If the Registrar in either case is satisfied:

    (a)that there has been honest concurrent use of the 2 trade marks; or

    (b)that, because of other circumstances, it is proper to do so;

    the Registrar may accept the application for the registration of the applicant's trade mark subject to any conditions or limitations that the Registrar thinks fit to impose. If the applicant's trade mark has been used only in a particular area, the limitations may include that the use of the trade mark is to be restricted to that particular area. 

    Note:  For limitations see section 6.

    (4)If the Registrar in either case is satisfied that the applicant, or the applicant and the predecessor in title of the applicant, have continuously used the applicant's trade mark for a period:

    (a)beginning before the priority date for the registration of the other trade mark in respect of:

    (i)            the similar goods or closely related services; or

    (ii)           the similar services or closely related goods; and

    (b)ending on the priority date for the registration of the applicant's trade mark;

    the Registrar may not reject the application because of the existence of the other trade mark.

    Note 1: An authorised use of the trade mark by a person is taken to be a use of the trade mark by the owner of the trade mark (see subsection 7(3)).

    Note 2: For predecessor in title see section 6.
    Note 3: For priority date see section 12.

    Section 10 - Definition of deceptively similar

    For the purposes of this Act, a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.

11. In the SGPs the Opponent nominated trade mark number 1580289 to support this ground. Although that trade mark was registered at the Relevant Date, it was subject to a later, successful, application for removal for non-use and therefore no longer supports this ground of opposition.[6] This ground is therefore not established.

    [6] 1872 Holdings VOF v Havana Club Holding SA [2017] ATMO 12, [18]–[23].

    Section 58

12. The ground based on s 58 of the Act is particularised in the SGPs in fundamentally identical terms as follows:

    The Opponent first used the trade mark CRAFT KITCHEN AND BAR, or a trade mark that is substantially identical or deceptively similar, in December 2017, and has continuously used the trade mark CRAFT KITCHEN AND BAR, or a trade mark that is substantially identical or deceptively similar, since that time.

    The Opponent’s date of first use pre-dates [the Relevant Date].

    The Applicant is therefore not the true owner of [the Applicant’s Trade Marks].

13. Section 58 of the Act is reproduced below:

    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.

14. The owner of a trade mark for particular goods/services is the person who first uses it in Australia, or first files a trade mark application in Australia, whichever is the earlier. It is now well established that in order to succeed under this ground of opposition the Opponent must establish three factors. These are:

    · The first factor: That the Applicant’s Trade Marks are identical, or substantially identical, to CRAFT KITCHEN AND BAR (‘the Opponent’s Trade Mark’);[7]

    ·     The second factor: That the Applicant’s Services are the ‘same kind of thing’ as the goods and/or services for which the Opponent’s Trade Mark was used;[8] and

    ·     The third factor: That a person other than the Applicant has the earlier claim to ownership of the Applicant’s Trade Marks based on use prior to whichever is the earlier of: (a) the application to register; or (b) any actual use of the Applicant’s Trade Marks by the Applicant.[9]

    The first factor

    [7] Carnival Cruise Lines Inc. v Sitmar Cruises Limited (1994) 31 IPR 375.

    [8] Re Hicks’ Trade Mark (1897) 22 VLR 636.

    [9] Settef SpA v Riv-Oland Marble Co (Vic) Pty Ltd (1987) 10 IPR 402, 413.

1. When considering ‘substantial identity’ in Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd  Windeyer J said:

   In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison.[10]

   [10] [1963] HCA 66, [12].

2. The relevant trade marks are juxtaposed below for ease of reference.

The Applicant’s Trade Marks	The Opponent’s Trade Mark
THE CRAFT & CO Kitchen-Bar	Craft Kitchen and Bar

1. There are a number of words which are common to the above trade marks. Nevertheless, the arrangement of those words along with the additional material present in both of the Applicant’s Trade Marks creates overall impressions which mean that neither of the Applicant’s Trade Marks is identical, or substantially identical, to the Opponent’s Trade Mark. In particular, ‘THE CRAFT & CO’ is likely to be seen as the primary indicator of trade source in the Applicant’s Word Mark. This is quite different to simply ‘Craft’ (which might be argued to have the distinguishing function in the Opponent’s Trade Mark). It might also be argued that the Opponent’s Trade Mark lacks inherent adaptation to distinguish, but it is not necessary that I consider that question here. The device present in the Applicant’s Logo creates another significant point of difference when that trade mark specifically is considered. The first factor is not satisfied; accordingly, this ground of opposition is not established. The other factors need not be considered.

   Section 60

2. The ground based on s 60 of the Act is particularised in the SGPs as follows:

   The Opponent has used the trade mark CRAFT KITCHEN AND BAR, or a trade mark that is substantially identical or deceptively similar, since December 2017, in connection with restaurant, bar and entertainment services.

   The Opponent has acquired a substantial reputation, particularly amongst Eltham locals, as a restauranteur providing services under or by reference to the trade mark CRAFT KITCHEN AND BAR.

   Due to the Opponent’s reputation, the Applicant’s use of [the Applicant’s Trade Marks] is likely to deceive or cause confusion.

3. Section 60 of the Act is reproduced below:

   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.

4. To establish this ground of opposition the Opponent must demonstrate that at the Relevant Date there was another trade mark which had acquired a reputation in Australia amongst a significant number of persons in the relevant market such that use of the Applicant’s Trade Mark would be likely to deceive or cause confusion. The Opponent has stated that its trade mark – CRAFT KITCHEN AND BAR – has such a reputation.

5. In McCormick & Co Inc v McCormick, Kenny J considered what is intended by the word ‘reputation’. Her Honour had consulted the Macquarie Dictionary and on the basis of the definition provided decided that, in s 60, reputation is ‘the recognition of the [trade mark] by the public generally’.[11] Her Honour quoted with approval the following words of Lockhart J from Re ConAgra Inc v McCain Foods (Aust) Pty Ltd:

   [R]eputation within the jurisdiction may be proved by a variety of means including advertisements on television or radio, or in magazines and newspapers within the forum. It may be established by showing constant travel of people between other countries and the forum and that people within the forum, (whether residents there or persons simply visiting there from other countries) are exposed to the goods of the overseas owner …[12]

   [11] [2000] FCA 1335, [81].

   [12] [1992] FCA 159, [118].

6. On the subject of reputation Kenny J also referred to the Hugo Boss decision, where the Registrar’s delegate observed:

   [I]t is true that the assessment of the reputation of a trade mark goes far beyond mere examination of sales or turnover of goods sold under that trade mark and contemplation of the advertising and promotional figures.

   As regards a trade mark, its reputation derives both from the quantum of sales under that mark and also its esteem, or image, projected by that trade mark. The quantum of sales, advertising and promotion contributes to the ‘recognition’ component of the trade mark’s reputation. The credit, image and values projected by a trade mark attaches to the ‘esteem’ component of the reputation as do the public events and other trader’s marks with which [the] owner of the trade marks in question chooses to associate the trade marks via sponsorships, cross-promotions, ‘contra deals’ and so forth.

   It follows that a trade mark used in relation to goods with comparatively low sales may have a high and strong reputation by virtue of the high credit or esteem in which it is held, or, conversely, that a trade mark which has very high sales may have a strong reputation notwithstanding the lack of esteem that attaches to it. The particular popular images, or sets of values, that attach to the trade mark are also, therefore, important parts of the reputation of the trade mark and may be as strong an associative force in the minds of the public as the association of the trade marks with the goods or services themselves.[13]

   [13] Jackson International Trading Co Kurt D Bruhl GMbH & Co KGv Hugo Boss AG [1999] ATMO 23 (Thompson).

7. The Opponent has indicated that it has used its trade mark since December 2017. The earliest use, therefore, is, at best, less than two months prior to the Relevant Date. I note, however, that one of the documents in Exhibit BM-1 to the Murphy declaration includes the words, ‘Open for business this Thursday, 25^th January 2018.’ Nevertheless, two months is an extremely short time for a trade mark to acquire the necessary reputation: the sales and/or marketing figures would need to be extraordinary.

8. The Murphy declaration contains the following statements regarding reputation:

   The Opponent is well-known in the Etham area by reference to its brand ‘Craft Kitchen & Bar’ for craft food and beverage services, as well as its associated art and craft activities, due to its use of consumer-facing materials and social media use including the following examples:

   Website operated by the Opponent featuring the trade mark ‘Craft Kitchen and Bar’. Exhibited and marked ‘BM-6’ are extracts from the Opponent’s website accessed on 31 January 2019.

   Websites of third party review websites which make reference to the Opponent's trade mark ‘Craft Kitchen and Bar’ and its food and beverage services. Exhibited and marked ‘BM-7’ are extracts from the websites of third party review websites accessed on 31 January 2019 referring to the Opponent's trade mark ‘Craft Kitchen and Bar’.

   Social media posts and pages operated by the Opponent featuring the trade mark ‘Craft Kitchen and Bar’. Exhibited and marked ‘BM-8’ are copies of social media pages and a selection of social media posts between 2017 and 2019.

9. The Applicant submitted the following regarding the Opponent’s evidence of reputation:

   The Opponent has not provided any figures which show the extent to which the Opponent’s goods and services have been provided under the Opponent’s Trade Marks, such as gross sales figures … The Opponent has also not provided any figures which show the extent to which the Opponent’s goods and services have been promoted or advertised under the Opponent’s Trade Marks, such as gross advertising expenditure. In McCormick & Company Inc v McCormick such advertising figures together with gross sales figures were recognised as key indicators of reputation.[14] It is telling that figures for neither has been provided.

   Further the Opponent has provided no data to indicate how many persons from Australia may have viewed any particular social media post or website prior [to the Relevant Date].

   [14] [2002] FCA 1335, [86].

10. I agree with Applicant’s criticisms of the Opponent’s evidence and am of the view that it falls well short of establishing that its trade mark acquired a reputation before the Relevant Date. Consequently, the Opponent has failed to establish this ground of opposition.

    Section 42(b)

11. Section 42 of the Act is reproduced below:

    42 Trade mark scandalous or its use contrary to law

    An application for the registration of a trade mark must be rejected if:

    (a) …

    (b) its use would be contrary to law.

12. The onus is on the Opponent to establish that use of the Applicant’s Trade Marks would be, rather than could be, contrary to law on the balance of probabilities.[15]

    [15] Advantage Rent-a-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683.

13. The particulars provided in the SGPs for this ground of opposition included the following:

    Due to the Opponent’s reputation, the Applicant’s use of [the Applicant’s Trade Marks would be] likely to deceive or cause confusion or amount to the making of a false representation, in breach of sections 18 and 29 of the Australian Consumer Law as set out in Schedule 2 of the Competition and Consumer Act 2010 (Cth). The Applicant’s conduct also amounts to passing off.

14. In the present matter the Opponent has failed to establish a ground of opposition under s 60 of the Act. As the test for misleading or deceptive conduct under s 18 of the Australian Consumer Law (‘the ACL’) is a more stringent test than that for deception or confusion under s 60,[16] I am satisfied that the Opponent has also failed to establish that the use of the Applicant’s Trade Mark would be contrary to s 18 of the ACL.

    [16] See, eg: Ownit Homes Pty Ltd v Ownit Conveyyancing Pty Ltd [2005] ATMO 47, [36]; Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191, 198 (Gibbs CJ).

15. Where a trade mark does not run afoul of s 18 of the ACL, neither will it run afoul of s 29 of the ACL, nor the tort of passing off. In Pacific Publications Pty Ltd v IPC Media Pty Ltd, Beaumont J considered—in connection with the superseded Trade Practices Act1974 (‘TPA’)—that ‘the Court’s conclusion on s 52 would necessarily carry with it a conclusion on s 53(c) and (d)’.[17] Sections 53(c) and 53(d) of the TPA are the equivalent provisions to ss 29(1)(g) and 29(1)(h) of the ACL. Hill J in Re Equity Access Pty Ltd v Westpac Banking Corporation also addressed the relationship between s 52 of the TPA and passing off. His Honour considered that:

    The scope for the operation of s 52 will thus be broader than that involved in the tort of passing off so that in a case such as the present where the claim is for the protection of the reputation in a name against the use of that name by another, failure to succeed under s 52 or s 53 will invariably mean that proceedings for passing off would likewise fail.[18]

    [17] [2003] FCA 104, [107].

    [18] [1989] FCA 506, [40] (citations omitted).

16. For these reasons I am not satisfied that use of either of the Applicant’s Trade Marks would be contrary to law. Therefore, the Opponent has failed to establish this ground of opposition.

    Section 43

17. Section 43 provides:

    An application for the registration of a trade mark in respect of particular goods or services must be rejected if, because of some connotation that the trade mark or a sign contained in the trade mark has, the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion.

18. This ground of opposition was particularised in the SGPs as follows:

    If [the Applicant] succeeds in registering [the Applicant’s Trade Marks] it will amount to a representation to consumers that it is the only provider of ‘craft’ food and beverage services and/or ‘craft’ ‘kitchen-bar’ services. The word ‘THE’ at the start of the Applicant's mark supports this connotation.

    This representation is false, in that many traders offer ‘craft’ food and beverage goods and services in Australia. The ‘craft’ food and beverage movement has been popular in Australia and overseas for a number of years now.

19. In McCorquodale v Masterson the court found:

    In an opposition to registration, s 43 of the Act requires an opponent to show that: (1) there is a connotation in the proposed trade mark or in a part of it; and (2) because of this connotation, the use of the proposed mark would be likely to deceive or cause confusion. The connotation must be contained within the mark itself. [19]

    [19] (2004) 63 IPR 582, [25].

20. Similarly in Pfizer Products Inc v Karam Gyles J said:

    ‘Connotation’ is a secondary meaning implied by the mark. The likelihood of deception or confusion must flow from the secondary meaning inherent in the mark itself. It is apparent that the underlying purpose of s 43 is a similar purpose to that lying behind ss 52, 53 and 55 of the Trade Practices Act 1974 (Cth). It is to prevent the public being deceived or confused as to the nature of the goods offered by reason of a secondary meaning connoted by the mark in question, rather than, for example, deception by reason of similarity with other marks … Section 43 might well prevent the registration of HERBAGRA for classes of goods with no connection with herbal ingredients. [20]

    [20] (2006) 70 IPR 599, [53] (emphasis added).

21. The Applicant submitted:

    [T]he common services of hospitality are sought by members of the public at large. As evidenced by Mr Cea [in the Cea declaration], such persons are used to seeing businesses referring to CRAFT and they are used to seeing businesses in the hospitality and food industry trading under branding consisting of the format ‘THE [GOOD/SERVICE] [SUFFIX]. He gives examples in relation to the following brands:

    a.The Coffee Club;

    b.The Cheesecake Shop;

    c.The Chocolate Box;

    d.The Food Warehouse; and

    e.The Lolly Shop.

    Therefore it is not likely that consumers would be likely to be deceived or confused into thinking that the Applicant is the only business in Australia providing craft beer or other craft drinks or food because it has ‘THE CRAFT’ in its branding.

    It is in fact highly unlikely …

22. I agree with the Applicant’s submissions. The Opponent has failed to establish this ground of opposition.

    Section 62A

23. In the SGPs the ground under s 62A was particularised as follows:

    a.The Applicant's filing of [the Applications] was made in bad faith.

    b.The Opponent has used the trade mark CRAFT KITCHEN AND BAR, or a trade mark that is substantially identical or deceptively similar, since December 2017, in connection with restaurant, bar and entertainment services.

    c.The Applicant filed [the Applications] on 19 January 2018.

    d.The Opponent sent a letter of demand with respect to its use of CRAFT KITCHEN AND BAR on 23 January 2018, asserting rights that it did not have (sic) in the recently filed [applications].

    e.The Opponents lawyers, Williams Winter, acted for the Opponent in connection with both the filing of [the Applications] and the letter of demand.

    f.In light of the above, it appears the Applicant was aware of the Opponent's use of CRAFT KITCHEN AND BAR at the time of filing [the Applications] and that the decision to file [the Applications] was an intentional act designed to curtail the Opponent's rights to offer its services by reference to the words CRAFT KITCHEN AND BAR.

24. The particulars are somewhat confusing; however, it is apparent from the Murphy declaration that a ‘cease and desist’ letter dated 23 January 2018 was sent by the Applicant to the Opponent. The letter is the basis for the assertion that the Applicant was aware of the Opponent’s use of the Opponent’s Trade Mark prior to filing the Applications.

25. 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.

26. 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.

27. The case of Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) is a current leading Australian authority on this section of the Act. 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.[21]

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

28. 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.[22]

    [22] Ibid [165]-[166].

29. I note that the cease and desist letter postdates the filing date of the Applications by four days and that two of those days were a Saturday and a Sunday. The letter is not indisputable proof that the Applicant was aware of the Opponent’s use of its trade mark prior to the Relevant Date; however, it seems likely, on the balance of probabilities, that the Applicant was aware. Nevertheless, the Applicant merely being aware of the existence of the Opponent’s Trade Mark does not mean that the Applications were made in bad faith.

30. I note the Applicant’s Earlier Logo and that it has a priority date in June 2015. The Opponent indicated it first used its trade mark in September 2017. The Applicant’s Logo contains a minor change to the Applicant’s Earlier Logo which consists of the addition of some descriptive words. The primary distinguishing part of the Applicant’s Word Mark, ‘THE CRAFT & CO’, appears in the Applicant’s Earlier Logo. In the face of those facts, I am not satisfied that the mere awareness of the Opponent’s use of its trade mark suggests that the Applicant’s conduct in making the Applications was unscrupulous, underhand or unconscientious in character. The Opponent has failed to establish this ground of opposition.

    Decision

1. Section 55 of the Act 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.

2. The Opponent has failed to establish any of the grounds of opposition it nominated in the SGPs. Accordingly, the Applicant’s Trade Marks may proceed to registration after one month from the date of this decision. If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until either the appeal is withdrawn or a court so orders.

   Costs

3. The Applicant has sought an award of costs in its favour. In opposition matters such as the present one, Section 221 of the Act and reg 21.13, together, provide the Registrar with a discretion to award costs ‘as the Registrar considers appropriate’.[23] In the normal course of events where two oppositions are heard together and no grounds of opposition are established, costs would be awarded against an opponent in line with the amounts in Schedule 8 of the Trade Mark Regulations 1995 (‘the Regulations’) with costs for the second of the two oppositions being assessed as set out in the table attached to the Hearing Officer’s decision in James Hardie & Co Pty Ltd v Hume Industries (Malaysia) Berhad.[24] In the present matter the Applicant has submitted that the usual discounting of costs for the second opposition is not appropriate. The Applicant submitted:

   Although such discounting may be seen in may instances to afford fairness to a party against whom a costs award is sought, in the present matter such fairness would be better served in properly compensating the Applicant.

   Having nominated 7 grounds of opposition, some of which were clearly hopeless, the Opponent has chosen not to either:

   a.Withdraw its oppositions; or

   b.Participate in the proceedings by at least refining its case through submissions.

   Such omission has unreasonably increased the costs of Applicant and it ought to properly be compensated.

   [23] Trade Mark Regulations 1995 (Cth) reg 21.13(1)(b).

   [24] (2001) 53 IPR 591.

4. I am persuaded by the Applicant’s submissions. The Applicant’s submission that ‘some’ of the grounds ‘were clearly hopeless’ was even somewhat generous. In my view most of the grounds were so unlikely to succeed that they should never had been included in the SGP in the first place, or at least, should not have been pursued to the bitter end. This has caused unnecessary costs for the Applicant in addressing those grounds and has unnecessarily taken up the Registrar’s time in having to deal with those grounds in this decision.

5. The items in Schedule 8 do not take into account the number of grounds of opposition nominated in a Statement of Grounds and Particulars. The costs recoverable by a party are the same whether a single ground with some prospect of success is nominated or seven largely hopeless grounds are nominated. It is open to the Registrar to take the conduct of a party to proceedings into account when awarding costs, and I do so here.

6. I award costs against the Opponent in line with the amounts in Schedule 8 of the Trade Mark Regulations for both oppositions.

   Robert Wilson
   Hearing Officer
   Trade Mark Oppositions and Hearings
   13 January 2020