Re: Trade mark applications number 711744 and 711745 in the name of

[1999] ATMO 36

TRADE MARKS ACT 1995

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

Re:      Trade mark applications number 711744 and 711745 in the name of
  MULTIX PTY LTD

Background

Applications number 711744 and 711745 were filed on 1 July 1996, in the name of Multix Pty Ltd (the applicant).  Each of the applications seeks registration of a trade mark consisting of an ‘aspect of packaging’ namely the colour of the packaging in which the designated goods are marketed.  At the date of filing, the trade marks were represented by means only of the following verbal descriptions:

Trade Mark application 711744 -

The trade mark consists of the colour red as the predominant background colour on the packaging of the goods.

Trade Mark application 711745 -

The trade mark consists of the colour red as the predominant background colour in combination with the colour white used in printing word marks on the packaging of the goods.

The applications specify goods in classes 6 and 21 described as:

Class 6-       Aluminium foil, and foil products formed therefrom, all being goods in class 6

Class 21 -Domestic utensils, including aluminium trays and containers, and trays and containers formed from aluminium foil

At examination, grounds for rejection were raised under section 41 of the Trade Marks Act 1995 (the Act) on the basis that other traders would be likely to wish to use the same, or very similar, colouring for the packaging of their similar goods or closely related services.  In response to this objection the applicant filed evidence of use of the marks consisting of a Statutory Declaration by Francis Harold Glasson, marketing manager of Multix Pty Ltd.  This gives details of the history of the marks, and sales and advertising figures.  Exhibits B and C to the declaration provide samples of the trade mark in use on packaging and in advertising and promotional material. Exhibit D is a report compiled by a market research consultancy (the Open Mind Research Group) entitled ‘COMALCO ALFOIL - DEVELOPING AN APPROPRIATE BRANDING STRATEGY’. A supplementary report from the Open Mind Research Group titled ‘MULTIX ALFOIL RED PACK RESEARCH’ was filed at a later stage of examination.

Mr Glasson, in his declaration, says that use of the subject trade marks commenced at least as early as 1973.  He says that Comalco Limited (the previous owner of the marks and owner of the trade mark COMALCO) at that time used the marks through a registered user arrangement with Leigh-Mardon Pty Ltd.  Exhibit A to Mr Glasson’s declaration is a copy of parts of an agreement dated 29 June 1973 between Comalco Ltd and Leigh-Mardon Pty Ltd.  The trade marks, Mr Glasson says, were then purchased by Multix Pty Ltd by agreement dated 1 July 1996.  The trade mark ALFOIL (registration number 169697) was also assigned from Comalco Limited to the applicant at that time.  All the samples of the trade marks provided by the applicant, as examples of use of the subject trade marks, carry one or more of the word trade marks COMALCO, ALFOIL, MULTIX and TRADITIONAL STRENGTH.

The marketing reports from the Open Mind Research Group were prepared on behalf of the applicant.  In submissions to the examiner, the attorneys for the applicant submitted that the ‘quantitative’ and ‘qualitative’ research results included in these reports demonstrate that the purchasing public identify red package colouring with the applicant or the applicant’s predecessor in business.

After consideration of the evidence and the consumer surveys in the marketing reports, further examiner reports were issued maintaining the grounds for rejection.  The examiner pointed out that the word marks on the packages appeared to be the primary identifiers, not the package colouring, and that the colour recognition level by consumers, reported in the surveys, did not indicate that the colouring was recognised as a distinctive trade mark.  The examiner also pointed out that there were other traders using red colouring on the packaging of their aluminium foil goods and that, in those circumstances, it would be very difficult for the applicant to show that the colour functioned as a trade mark and that, as a badge of origin, it denominated the applicant’s goods. The grounds for rejection were stated in terms of subsection 41(6) and the evidence was found to be insufficient for the purposes of paragraph 41(6)(a). In short, the examiner held that the evidence of use submitted did not establish that, at the date of filing, the trade marks had been used to the extent that they did, in fact, distinguish the designated goods as being those of the applicant.

The applicant’s attorneys sought a hearing on the matter, which was held before me in Melbourne on 4 June 1998.  At the hearing, the applicant was represented by Mr Russell Waters, of Phillips Ormonde & Fitzpatrick, patent and trade mark attorneys of Melbourne.

The representations of the trade marks

During the examination of the trade mark applications, the applicant was requested to provide pictorial representations of the trade marks in addition to the verbal descriptions provided on filing of the applications.  This requirement is set out in section 4.8 of Part 21 of the Trade Marks Office Draft Manual of Practice and Procedure (the Draft Manual).  The applicant’s attorneys declined to provide pictorial representations, claiming that this was only a general requirement for graphical representation of colour trade marks and was not appropriate to these particular trade marks.  Following the hearing, I gave the applicant a further opportunity to define the trade marks more clearly by means of pictorial representations.  In particular, I wished to clearly understand the extent and location of the red colouring on the packaging.

In response, the applicant provided a representation as shown below. This shows two perspectives of the packaging, with shading in the areas where the red colouring appears on the packages.

At the same time, the verbal descriptions of the trade marks were amended as follows:

Trade Mark application 711744 -

The trade mark consists of the colour red as the predominant background colour on the packaging of the goods, as exemplified by the attached representations in which the background colour in the shaded ares is the colour red.

Trade Mark application 711745 -

The trade mark consists of the colour red as the predominant background colour as exemplified by the attached representation in which the background colour in the shaded areas is the colour red, in combination with the colour white used in printing word marks on the packaging of the goods.

This decision is in respect of the trade marks as now represented.

The law

Section 41 of the Trade Marks Act 1995 deals with trade marks in terms of whether or not they are capable of distinguishing an applicant’s goods or services. The matter to be decided here is whether there are grounds for rejection of these trade marks under Section 41 of the Act and, if so, whether the registrability of the trade marks must be assessed under the provisions of subsection 41(5) or the more stringent requirements of subsection 41(6). Section 41 has been judicially considered by Justice Branson in the OREGON case Blount Inc v The Registrar of Trade Marks (1998) 40 IPR 498.

Her Honour observes that, in applying the provisions of section 41, and in deciding whether a trade mark is capable of distinguishing, the Registrar has three options. He or she may conclude:

(a)       that the trade mark is inherently adapted to distinguish the designated goods  or services from the goods or services of other persons and capable, on that basis alone, of so distinguishing the designated goods or services; or

(b)       that 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; or

(c)       that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, but there is uncertainty, on that basis alone, that the trade mark is actually capable of distinguishing the designated goods or services.

Justice Branson goes on to outline the consequences of each of these findings.  If the Registrar reaches conclusion (a) he or she must accept the application by reason of subsection 33(1).  If option (b) applies, then the provisions of paragraphs (a) and (b) of subsection 41(6) are brought into operation and the application must be rejected unless the applicant establishes that, because of the extent to which it has used the trade mark before filing the application, the trade mark does distinguish the designated goods.  If the Registrar reaches conclusion (c), then the provisions of paragraphs (a), (b) and (c) of subsection 41(5) are brought into operation. Then, in deciding whether the trade mark does or will distinguish the designated goods, and may therefore be accepted as a trade mark capable of distinguishing the applicant’s goods, the Registrar must take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods, the use, or intended use, of the trade mark by the applicant and any other circumstances which may be relevant. 

Therefore the first step in determining the issues of section 41 is to consider the extent to which these trade marks are inherently adapted to distinguish the designated goods from the goods of other persons. As Justice Branson confirms in her decision, the expression inherently adapted to distinguish in section 41 has the same significance as it had under the Trade Marks Act 1955. The meaning of those words was explained in Clark Equipment Company v Registrar of Trade Marks, the MICHIGAN case, 111 CLR 511 and this continues as good precedent under the Trade Marks Act 1995.

In the MICHIGAN case the trade mark in question was a word mark but the principle applies equally to any sign.   Adapting the words of Justice Kitto at p 514:

... the question of whether a mark is adapted to distinguish [is to] be tested by reference to the likelihood that other persons trading in goods of the relevant kind and being actuated only by proper motives  …  will think of the [sign] and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it.

Applying this to the subject trade marks, the question is whether other traders, actuated only by proper motives, are likely to wish to use the colour red as “background” colouring on the packaging of their aluminium foil products, or similar goods, in a way that might infringe these trade marks if they were to proceed to registration.  In the case of application 711745 the test may go a stage further and it may be necessary to consider whether it is likely that other traders will also wish to print word trade marks in white on packaging which has red “background” colouring.  The more likely it is that this will happen, the less the inherent adaptation of the applicant’s trade marks. If, as the examiner has maintained, it is very likely indeed, the trade marks must be seen to fall into Justice Branson’s category (b) as marks which are not to any extent inherently adapted to distinguish the designated goods.

Submissions and discussion

Before making his submissions and discussing the applicant’s evidence, Mr Waters handed up a Statutory  Declaration from Ms Emily Ianuali, marketing manager of Multix Pty  Ltd.  He pointed to her experience in the retail grocery industry where she has worked for 15 years , including a period of four and a half years with the applicant company, claiming that this qualified her to comment on the retailing of household aluminium products.  Mr Waters went on to make substantial submissions on the registrability of the subject trade marks.

Inherent adaptation to distinguish

In his submissions, Mr Waters argues strongly that both trade marks have a degree of inherent adaptation to distinguish and fall within the provisions of subsection 41(5) rather than subsection 41(6).

First, Mr Waters maintains that the practice set out in the Draft Manual implies that colour trade marks may have some inherent adaptation to distinguish.  He referred me to section 4.3 and paragraphs 4.3.1 and 4.6.3 of Part 21 of the Draft Manual, which he claims imply that the standard of proof for “colour” trade marks is at the level of subsection 41(5) rather than the more stringent requirement under subsection 41(6). He claims that further support for this is provided by the existence of colour trade marks registered under the provisions of the Trade Marks Act 1955, which required that a mark have at least a degree of adaptation to distinguish before it could achieve registration. In particular he referred me to the “pink batt” trade mark 576188 which consists of the colour pink applied to insulation batts.

I find that I am not in agreement with Mr Waters on the issues raised in these submissions.  There is no doubt that the Trade Marks Act 1995 includes colour as an aspect of packaging in the definition of a trade mark and this is clearly stated in the Draft Manual (Part 21 section 4.3).  However, the guidelines provided in paragraphs 4.3.1 and 4.6.3 of Part 21 must be seen for what they are – just guidelines on the requirements for registration of marks consisting of colour applied to goods or their packaging. Paragraph 4.3.1 does not imply, as Mr Waters suggests, that single colours will always be considered to have a degree of inherent adaptation to distinguish. It clearly states that such marks must be subject to “special considerations”.  These special considerations will include the nature of the goods, the market in which they are sold, the particular colour for which registration is sought and whether that colour serves a particular function in respect of the goods, or there is a competitive need for it within the market concerned.

The “pink batt” trade mark 576188 to which Mr Waters refers was considered to have some inherent adaptation to distinguish because the material from which insulating batts are fabricated is not naturally pink and the applicant was able to show that no other manufacturers coloured their insulating batts, and in particular, that no other manufacturers produced pink coloured batts.  Even so, a great deal of evidence of use by the applicant was required and the fact that the applicant had been the registered proprietor of the successful word mark PINK BATTS for some 13 years was a further factor in favour of registration.  The situation was similar in the Blue Paraffin case [(1977) RPC 493] - the second case which Mr Waters relied upon. There too paraffin is naturally colourless and it was out of the ordinary to add colour. The court found there that for those goods the colour blue was an added extra which was capable of indicating the trade origin of those goods. In contrast, the subject marks consist of colour, commonly in use as an aspect of packaging and, in the Australian market, the packaging of aluminium foil, and domestic utensils and containers formed from aluminium foil, is as a matter of course printed up in colour.

Secondly, Mr Waters submits that the explanatory note which accompanies subsection 41(6) implies that colour marks do not fall within the provisions of the section.  The note states that marks that are not inherently adapted to distinguish goods or services are mostly those that are “ordinarily used” to indicate various features of those goods or services.  Mr Waters submits that colour does not have an “ordinary use” in relation to the designated goods and on this basis he maintains the marks are excluded from consideration under this subsection and must be seen to possess a degree of inherent adaptation to distinguish. This degree, he claims is higher for the mark covered by application 711745 which consists of two colours in combination.  However, I do not agree with his proposition as it ignores the fact that the note is qualified by the word “mostly”.  While the note serves as a useful guide for many kinds of trade marks,  “mostly” means that the list is not exhaustive. It therefore does not cover all marks which are not inherently adapted to distinguish goods or services.  The test which must be applied to the subject trade marks is that referred to above from the MICHIGAN case.   

When I apply that test to these trade marks in relation to the goods in the specification, I do not agree with Mr Waters’ submission that the trade marks are inherently capable of distinguishing the applicant's goods.  Traders in all fields, as a matter of course, use colour on their packaging to make the packaging more attractive to consumers. Red has long been a colour which is used to draw attention, as shown by its use for letterboxes and for signs indicating danger.  The colour red is commonly used by traders in many fields to attract attention to their goods.  In this sense colour is a functional aspect of packaging and the colour red is particularly desirable for this purpose.  It therefore seems to me highly likely that other traders in the aluminium foil market will think of the colour red and, without improper motive, will wish to use this eye catching colour on their packaging and in doing so will be fulfilling a competitive desire to attract attention to their goods.  As per Kitto J. in the MICHIGAN case (supra), if they choose to use red, alone or in combination with other colours, in a way that might be seen to form a “background”, they should not be put at risk of infringing the applicant’s trade mark, until such time as the applicant can clearly establish that the red colouring they seek to register is factually distinctive of their goods.  Nor do I consider that the printing of word marks in white on a red background colouring adds to the inherent adaptation to distinguish.  If the word marks are capable of distinguishing the applicant’s goods it will be the words themselves which identify the goods, not the fact that they are printed in white.  It is not uncommon to use white or another very light colour to represent trade marks on a coloured background, purely for the purpose of making the marks easily readable. 

There are already other traders using the colour red on their packaging for aluminium foil and this fact was raised during examination. Mr Waters points out that inherent adaptation to distinguish is to be assessed without considering the effect of use, whether that is use by the applicant or another party. He further submits that the applicant’s predecessor in business was the only trader to use the colour red “as a background colour” on its packaging from 1973 to June 1994, a belief attested to by Ms Ianuali in her declaration. Therefore he claims that use by other traders of the colour red on their packaging was not without improper motive but rather an attempt by competitors to benefit from the applicant’s position as a market leader.  This is, however, an unsupported allegation and in any case seems to hinge on an interpretation of what is meant by use as a “background colour” since Ms Ianuali does not say that there were no other traders using the colour red per se on the packaging of their similar goods during the period.  Therefore, while I agree with Mr Waters that the use of the red colouring by other traders does not of itself effect the inherent adaptation of the colour to distinguish the designated goods, in my view, the fact that it is already in use is a clear indication that there is an apparently honest wish by others to apply the colour to the packaging of their goods.

In summary, nothing that has been put before me has persuaded me in the least, that other traders will not, innocently, wish to use the colour red, or the colour red combined with white lettering, in any manner or to any degree, on the packaging of their own similar goods.  Therefore, I find that the trade marks as represented have no inherent adaptation to distinguish the applicant’s designated goods and the grounds for rejection have been quite properly taken under subsection 41(6).  The applications must be rejected unless the applicant is able to establish that because of the extent of its use of the trade marks before the filing date the trade marks do in fact distinguish the designated goods as being those of the applicant.

The evidence of use

The evidence of use of the trade marks is contained in the Glasson declaration.  Mr Glasson says that the trade marks have been used continuously in relation to a range of aluminium foil products since at least 1973. In support of this statement, Exhibit A to his declaration is a copy of parts of an agreement dated 29 June 1973 between Comalco Ltd and Leigh-Mardon Pty Ltd.  Mr Glasson says this agreement covers authorised use of the subject trade marks by Leigh-Mardon Pty Ltd.  However, I note that while the agreement refers to COMALCO ALFOIL it does not mention any other trade marks.  There are some undertakings referred to which concern the COMALCO ALFOIL “package design” but the nature of the design is not specified and there is no reference to any colour being an aspect of that packaging.  Therefore I do not see that this material is evidence of the date of commencement of use of the trade marks subject of these applications.

The examples of the trade marks applied to packaging and used in promotional material provided in Exhibits B and C to the Glasson declaration are almost all recent in origin.  The only example which bears a date earlier than 1994 is in what appears to be a magazine insert entitled ‘101 Household Hints with COMALCO ALFOIL’ on which the date ‘8/4/70’ is hand written.  This shows a package of aluminium foil bearing the trade marks COMALCO, printed in white, and ALFOIL, printed in white with a black outline, on a package coloured red, yellow and ‘silver’.  Red is not the predominant colour on this package nor could it be described as the ‘background’ colour of the package.  There is nothing in the evidence provided that demonstrates when the predominantly red packaging, depicted in the representations filed for these trade marks, first came into use. Therefore, Mr Waters’ claim that these trade marks have been used since at least 1973 is unsubstantiated.

In making his submissions Mr Waters referred me to the high sales values and advertising expenditure quoted in the Glasson Declaration.  Annual retail sales of the designated goods averaged $10 million to $12 million for the period 1989 to 1996 and approximately $3.5 million was spent on advertising in the period 1993 to 1996.  These are impressive figures particularly since, as stated in the marketing reports, they are sold in a market where consumers purchase the products infrequently.  However, one thing which is clear from the exhibits provided is that the packages in which the goods have been marketed have always carried one or more word marks; these are COMALCO and ALFOIL on earlier packaging and MULTIX, ALFOIL and TRADITIONAL STRENGTH more recently.  As the examiner pointed out, the words on the packaging serve as the primary identifiers and in these circumstances it is more difficult for the applicant to demonstrate that the subsidiary features, in this case the red colouring, or the red colouring with the word marks printed in white lettering, function as trade marks in their own right.

Mr Waters submits that there are many examples of dual trade marks, particularly where one mark is also the name of the trade mark owner, as in Holden Kingswood, Ford Falcon and Kraft Vegemite, and that this does not detract from the registrability of the second mark in its own right.  This may well be so but I note that in the examples he has given, the words Kingswood, Falcon and Vegemite are each inherently adapted to distinguish the goods in question and are separately registrable. When a secondary mark which lacks inherent adaptation to distinguish is always used with a house mark the situation is very different and the secondary mark falls into the category of “limping marks” referred to by Jacob J in Philips Electronics NV v Remington Consumer Products (40 IPR 279 at page 301) as one “always used with what is obviously a proper trade mark”. In that case the “limping mark” was a representation of a three-headed shaver and therefore one which “primarily denotes function” but Jacob J also used the term in respect of the descriptive word TREAT in British Sugar Plc v James Robertson & Sons Ltd [1996] RPC 281. At page 302 he notes the difficulty of demonstrating that such a mark distinguishes the goods of a particular trader when he says

It is precisely because a common laudatory word is naturally capable of application to the goods of any trader that one must be careful before concluding that merely its use, however substantial, has displaced its common meaning and has come to denote the mark of a particular trader.  This is all the more so when the mark has been used in conjunction with what is obviously taken as a trade mark.  

This, I believe, applies equally to the use of ordinary colours as an aspect of packaging in a field where it is common to use coloured packaging to attract attention to the goods.  Here the question is whether the use of red colouring on the applicant’s packages, which also carry words that are obviously trade marks, has resulted in the red colouring coming to denote the mark of the applicant.  As Jacob J points out “merely its use, however substantial” is not enough to show that. 

The market research evidence

The other evidence provided by the applicant to support these applications is contained in the two research reports produced by the Open Mind Research Group. Mr Waters submits that these reports show, both on a qualitative and quantitative level, that consumers associate red packaging with the products of the applicant and its predecessors in title, Comalco Limited.

The research was carried out between 1995 and 1997 to “assess consumer reactions to packaging design options for managing the brand change from Comalco Alfoil”.  The qualitative research consisted of a “small scale exploratory study” involving in depth analysis of information from a relatively small number of respondents.  Some of the conclusions drawn from this were that the “red pack” is “an essential and recognisable feature of the (Comalco) brand”, that “red means quality” and that “colour (is) a key criterion in this product category”.  On this basis the research company recommended that the applicant “maintain the red pack colour because it has become an important feature for the brand”.  However, I note that one of the recommendations was that the company should use both the COMALCO and MULTIX trade marks on the pack initially, which suggests that the research company also recognised that the brand name was a primary identifier of the goods.

The second report by the Open Mind Research Group, dated October 1997, gives details of the quantitative research carried out.   The result of this research, said to be relevant here, was that just over 50% of the 461 consumers surveyed “associated the brands Comalco and/or Multix with having a red pack” and that no other brand came near this level of association.  The research company explicitly stated that this association was particularly strong given that the telephone surveys used for this report did not have the visual clues of an array of packs of these goods.  Mr Waters submits that this level of product recognition is sufficient to show that the trade marks applied for do in fact distinguish the applicants goods and that the evidence provided is sufficient even if the criteria under subsection 41(6) are to be applied.  I cannot agree with Mr Waters that this is the case.  Firstly, the survey was structured so that the respondents were only given a choice of five brands with which to associate a “red pack” of which two were Comalco and Multix and the others were Glad, Tiger and Oso.  The survey was carried out over the period from August 1996 to May 1997 (after the date of filing these applications) by which time it seems from Mr Waters’ submissions that there were at least two other competitors of the applicant (Farmland and Bi-Lo) using red colouring on their packaging, who were not included in the survey.  Secondly, if the red colouring on the pack was really serving as a badge of origin for the applicant I would have expected far in excess of 50% of aluminium foil product purchasers to associate a ‘red pack’ with the applicant or its predecessor in business.

The results seem to emphasise the fact these trade marks did not at the date of filing distinguish the applicants’ goods.  In spite of the amount of money spent on advertising (up to 2 million dollars a year) and the number of aluminium foil products sold each year (around 5 million items a year), the survey results say that nearly 50% of consumers did not associate the Multix brand or the Comalco brand with red packaging.  I am not satisfied therefore that the evidence furnished shows that the trade mark subject of application number 711744 had achieved the necessary recognition in the relevant market needed for application of the provisions of paragraph 41(6)(a).  Nor am I satisfied that the evidence shows that, in the case of application number 711745, the use of the colour red on the packaging in combination with the colour white used in printing word marks on the packaging, is any more capable of distinguishing the applicant’s goods.

Decision         

I have found that the trade marks subject of these applications are not to any extent adapted to distinguish and therefore fall under the provisions of subsection 41(6) of the Act.  Having considered the evidence on file, I have found that it fails to establish that the trade marks do distinguish the designated goods in terms of paragraph 41(6)(a). The trade marks are therefore not capable of distinguishing the applicant’s goods and, in accordance with the provisions of subsection 41(2), I reject applications number 711744 and 711745.

Coral Henry
A/Senior Examiner
16 April 1999