Rodney Jane Racing Pty Ltd v Monster Energy Company
[2019] FCA 923
•21 June 2019
FEDERAL COURT OF AUSTRALIA
Rodney Jane Racing Pty Ltd v Monster Energy Company [2019] FCA 923
Appeal from: Monster Energy Co v Rodney Jane Racing Pty Ltd [2018] ATMO 57 File number(s): VID 553 of 2018 Judge(s): O'BRYAN J Date of judgment: 21 June 2019 Catchwords: TRADE MARKS – registration – opposition – appeal from decision of Registrar of Trade Marks refusing registration – whether appellant had valid claim to ownership of marks at priority date – whether appellant intended to use or authorise use of marks at priority date – whether marks likely to deceive or cause confusion – appeal allowed
EVIDENCE – admissibility of documents downloaded from websites, the Wayback Machine, Facebook and Instagram and data generated by Google Analytics – whether documents constitute business records under section 69 of the Evidence Act 1995 (Cth) – whether Court should exercise its discretion under section 135 of the Evidence Act 1995 (Cth) to exclude the evidence
Legislation: Trade Marks Act 1995 (Cth) ss 7(3), 8, 42(b), 58, 59, 60 Cases cited: ACCC v Air New Zealand Limited (No 1) (2012) 207 FCR 448
ACCC v Air New Zealand Limited (No 5) (2012) 301 ALR 352
ACCC v Coles Supermarkets Australia Pty Ltd (2014) 317 ALR 73
Asden Developments Pty Ltd (in liq) v Dinoris (No 2) (2015) 235 FCR 382
ASIC v Hellicar (2012) 247 CLR 345
Aston v Harlee Manufacturing Co (1960) 103 CLR 391
Australian Meat Group Pty Ltd v JBS Australia Pty Ltd (2018) 363 ALR 113
Australian Postal Corporation v Digital Post Australia Pty Ltd (2013) 308 ALR 1
Berlei Hestia Industries Ltd v Bali Co Inc (1973) 129 CLR 353
Brooks v Fairfax Media Publications Pty Ltd [2015] NSWSC 986
CA Henschke & Co v Rosemount Estates Pty Ltd (2000) 52 IPR 42
Caesarstone Ltd v Ceramiche Caesar SpA (No 2) (2018) 133 IPR 417
Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45
Charan v Nationwide News Pty Ltd [2018] VSC 3
Chong v CC Containers Pty Ltd (2015) 49 VR 402
Coca-Cola Co v All-Fect Distributors Ltd (1999) 96 FCR 107
Colorado Group Limited v Strandbags Group Pty Limited (2007) 164 FCR 506
Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd (2004) 209 ALR 1
de Cordova v Vick Chemical Co (1951) 68 RPC 103
Delfi Chocolate Manufacturing SA v Mars Australia Pty Ltd (2015) 115 IPR 82
Dowling v Commonwealth Bank of Australia [2008] FCA 59
Dunlop Aircraft Tyres Ltd v Goodyear Tire & Rubber Company (2018) 134 IPR 220
E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2008) 77 IPR 69
E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144
Flexopack S.A. Plastics Industry v Flexopack Australia Pty Ltd (2016) 118 IPR 239
Food Channel Network Pty Ltd v Television Food Network GP (2010) 185 FCR 9
Gain Capital UK Ltd v Citigroup Inc (No 4) (2017) 123 IPR 234
Google Inc v ACCC (2013) 249 CLR 435
Hansen Beverage Company v Bickfords (Australia) Pty Ltd (2008) 75 IPR 505
Hansen Beverage Company v Bickfords (Australia) Pty Ltd (2008) 171 FCR 579
Hills Industries Ltd v Bitek Pty Ltd (2011) 214 FCR 396
Hugo Boss AG v Jackson International Trading Co Kurt D Bruhl GmbH & Co KG (1999) 47 IPR 423
Jafferjee v Scarlett (1937) 57 CLR 115
Jones v Dunkel (1959) 101 CLR 298
Lodestar Anstalt v Campari America LLC (2016) 244 FCR 557
Manly Council v Byrne [2004] NSWCA 123
Mars Australia Pty Ltd v Sweet Rewards Pty Ltd (2009) 81 IPR 354
McCormick & Co Inc v McCormick (2000) 51 IPR 102
McMahon v John Fairfax Publications Pty Ltd (No 4) [2012] NSWSC 216
Metro Business Centre Pty Ltd v Centrefold Entertainment Pty Ltd (2017) 127 IPR 1
Moorgate Tobacco Co Ltd v Philip Morris Ltd (No 2) (1984) 156 CLR 414
National Telecoms Group Ltd v John Fairfax Publications Pty Ltd (No 1) [2011] NSWSC 455
Optical 88 Ltd v Optical 88 Pty Ltd (No 2) (2010) 275 ALR 526
Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191
Pedavoli v Fairfax Media Publications Pty Ltd (2014) 324 ALR 166
Pfizer Products Inc v Karam (2006) 219 FCR 585
Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd (2017) 251 FCR 379
Pioneer Kabushiki Kaisha v Registrar of Trade Marks (1977) 137 CLR 670
Polo Textile Industries Pty Ltd v Domestic Textile Corporation Pty Ltd (1993) 42 FCR 227
Qantas Airways Ltd v Edwards (2016) 338 ALR 134
Re Rysta Ltd’s Application (1943) 60 RPC 87
Registrar of Trade Marks v Woolworths Limited (1999) 93 FCR 365
Roach v Page (No 15) [2003] NSWSC 939
Roach v Page (No 27) [2003] NSWSC 1046
RPS v R (2000) 199 CLR 620
Saville Perfumery Ltd v June Perfect Ltd (1941) 58 RPC 147
Seven Network Ltd v News Limited [2007] FCA 1062
Shape Shopfitters Pty Ltd v Shape Australia Pty Ltd (No 2) [2017] FCA 474
Shell Company of Australia Ltd v Esso Standard Oil (Aust) Ltd (1963) 109 CLR 407
Shell Company of Australia Ltd v Rohm and Haas Company (1949) 78 CLR 601
Singtel Optus Pty Ltd v Optum (2018) 140 IPR 1
Southern Cross Airports v Chief Commissioner of State Revenue [2011] NSWSC 349
Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592
Sports Warehouse Inc v Fry Consulting Pty Ltd (2010) 186 FCR 519
Stone & Wood Group Pty Ltd v Intellectual Property Development Corporation Pty Ltd (2018) 357 ALR 15
Telstra Corp Ltd v Phone Directories Co Pty Ltd (2014) 316 ALR 590
Telstra Corporation Limited v Phone Directories Co Australia Ltd (2015) 237 FCR 388
Tivo Inc v Vivo International Corporation Pty Ltd [2012] FCA 252
Trident Seafoods Corp v Trident Foods Pty Ltd (2018) 137 IPR 65
Vendor Advocacy Australia Pty Ltd v Seitanidis (2013) 103 IPR 1
Vitali v Stachnik [2001] NSWSC 303
Vivo International Corporation Pty Ltd v Tivo Inc (2012) 294 ALR 661
Voxson Pty Ltd v Telstra Corporation Limited (No. 10) (2018) 134 IPR 99
Yarra Valley Dairy Pty Ltd v Lemnos Foods Pty Ltd (2010) 191 FCR 297
Date of hearing: 5, 6, 7 March 2019 and 15, 16 April 2019 Registry: Victoria Division: General Division National Practice Area: Intellectual Property Sub-area: Trade Marks Category: Catchwords Number of paragraphs: 206 Counsel for the Appellant: Mr E Heerey QC with Mr P Creighton-Selvay Solicitor for the Appellant: Kahns Lawyers Counsel for the Respondent: Mr B Caine SC with Ms S Ryan Solicitor for the Respondent: Davies Collison Cave Law ORDERS
VID 553 of 2018 BETWEEN: RODNEY JANE RACING PTY LTD (ATF THE RODNEY JANE RACING TRUST) (ACN 101 266 460)
Appellant
AND: MONSTER ENERGY COMPANY
Respondent
JUDGE:
O'BRYAN J
DATE OF ORDER:
21 June 2019
THE COURT ORDERS THAT:
1.The appeal be allowed.
2.The decision of the delegate of the Registrar of Trade Marks given on 26 April 2018 be set aside.
3.Australian trade mark applications numbered 1670840, 1670841 and 1670842 be registered.
4.Until further order and on the ground that it is necessary to prevent prejudice to the proper administration of justice under section 37 AF of the Federal Court of Australia Act 1976 (Cth), publication of the following confidential exhibits be prohibited, other than to external solicitors and counsel retained for the purposes of this proceeding:
(a)Confidential Exhibit SAP-2 to the affidavit of Sam Anthony Pontrelli sworn 4 October 2018;
(b)Confidential Exhibit SPT-2 to the affidavit of Samuel Peter Thiele affirmed 4 October 2018; and
(c)Confidential Exhibit TJK-1 to the affidavit of Thomas J Kelly sworn 4 October 2018.
(d)Confidential Exhibit RBJ-20 to the affidavit of Rodney Bruce Jane sworn 22 November 2018.
(e)Confidential Exhibit RBJ-22 to the affidavit of Rodney Bruce Jane sworn 12 February 2019.
(f)Confidential Exhibit RBJ-23 to the affidavit of Rodney Bruce Jane sworn 12 February 2019.
(g)Confidential Exhibit RBJ-25 to the affidavit of Rodney Bruce Jane sworn 12 February 2019.
(h)Confidential Exhibit RBJ-26 to the affidavit of Rodney Bruce Jane sworn 12 February 2019.
(i)Confidential Exhibit RBJ-30 to the affidavit of Rodney Bruce Jane sworn 12 February 2019.
(j)Exhibit A2 being the email from Dean Hockley dated 2 May 2013.
(k)Exhibit A3 being the email from Phil Weir dated 15 April 2013.
(l)Exhibit A4 being the email from Dean Hockley dated 10 April 2013.
5.The respondent pay the appellant’s costs of this proceeding and the proceeding before the Registrar of Trade Marks.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
RULINGS
O’BRYAN J:
1. INTRODUCTION
On 27 January 2015, the appellant, Rodney Jane Racing Pty Ltd (RJR), applied for registration under Part 4 of the Trade Marks Act 1995 (Cth) (the Act) of three trade marks (which I will refer to as the RJR marks) in class 12 in relation to “alloy wheels for automobiles excluding motorbikes”. The RJR marks are as shown in the following table. As can be seen, each of the RJR marks includes the word “Monster”:
No 1670840
No 1670841
No 1670842
Registration of the RJR marks was opposed by the respondent, Monster Energy Company (MEC). MEC is a supplier of energy drinks. Since 2002, MEC has promoted and sold its energy drinks and associated products throughout the world under several trade marks, represented below, including in Australia since 2009. On 24 April 2018, a delegate of the Registrar refused registration of the RJR marks pursuant to s 60 of the Act: Monster Energy Co v Rodney Jane Racing Pty Ltd [2018] ATMO 57. The delegate concluded that MEC had made out the ground of opposition in s 60 of the Act in respect of several of its trade marks.
By notice of appeal filed 14 May 2018, RJR appeals against the decision of the delegate under s 56 of the Act, joining MEC as respondent to the appeal. The appeal involves a hearing de novo: Registrar of Trade Marks v Woolworths Limited (1999) 93 FCR 365 at [32] (Woolworths). The onus is borne by the opponent to registration: Woolworths at [45]. The standard of proof is the balance of probabilities: Telstra Corporation Limited v Phone Directories Co Australia Ltd (2015) 237 FCR 388 at [133]. It is common ground between the parties that the date on which the grounds of opposition must be established is the filing date of the application for registration (27 January 2015), which I will refer to as the priority date: Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 (Southern Cross); Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd (2017) 251 FCR 379 (Pham Global).
MEC maintains its opposition to registration of the RJR marks. It relies on the ground of opposition found by the delegate of the Registrar, s 60, as well as the further grounds stated in its amended notice of contention dated 31 January 2019 being ss 42(b), 58 and 59 of the Act. MEC did not press ground 2 of its amended notice of contention.
In respect of its opposition under ss 42(b) and 60 of the Act, MEC relies on its reputation in each of the following trade marks owned by it (MEC marks):
(a)the word marks “Monster” and “Monster Energy”; and
(b)
device marks which incorporate a device that is referred to as the “M-icon” (and which resembles a claw mark or scraping that might be made by a figurative monster) either on its own or in conjunction with a stylised depiction of the words “Monster Energy” (using script for the word “Monster” that is suggestive of Gothic script) as shown below:
In respect of s 60 of the Act, MEC contends that, before the priority date for the registration of the RJR marks, the MEC marks had acquired a reputation in Australia and, because of that reputation, the use of the RJR marks on alloy wheels for motor vehicles would be likely to deceive or cause confusion. Relying on s 57 of the Act, MEC also opposes registration of the RJR marks on the basis stated in s 42(b) of the Act: that the use of the RJR marks would be contrary to law. In that respect, MEC contends that the use of the RJR marks on alloy wheels for motor vehicles would be likely to mislead or deceive consumers in contravention of ss 18 and/or 29 of the Australian Consumer Law by reason of:
(a)the reputation of MEC in Australia as at the priority date in the MEC marks; and
(b)the similarity between the RJR marks and the MEC marks.
In closing submissions, Senior Counsel for MEC acknowledged that if the Court found against it under s 60, it would follow that the Court would find against it under s 42(b) of the Act. As the evidence relied upon in respect of ss 60 and 42(b) is the same, it is convenient to address both sections together.
In respect of s 58, MEC contends that RJR did not have a valid claim to ownership of the RJR marks as at the priority date. In respect of s 59, MEC contends that RJR did not have the requisite intention to use the RJR marks as at the priority date. Under both sections, MEC argues that another company closely associated with RJR (through common shareholdings and directors), Bob Jane Corporation Pty Ltd (Bob Jane Corporation), was the owner of the RJR marks and had the requisite intention to use the marks as at the priority date. The evidence relied upon in respect of ss 58 and 59 is the same, and it is also convenient to address both of those sections together.
For the reasons that follow, the grounds of opposition are not made out. It is convenient to address the ownership and intended use issues (ss 58 and 59) before addressing the likely to deceive or cause confusion issues (ss 60 and 42(b)).
2. OWNERSHIP AND INTENDED USE
2.1 Overview
On these issues, the dispute between the parties is whether RJR or Bob Jane Corporation is to be regarded as the owner of the RJR marks as at the priority date for the purposes of s 58 of the Act, and a corresponding issue as to which of those companies had the intention to use the RJR marks as at that date for the purposes of s 59 of the Act. The dispute arises out of the circumstances in which the RJR marks were created and first used and the corporate and commercial relationship between RJR and Bob Jane Corporation, including particularly the dual positions held by Rodney Jane as the sole director of RJR and as a director and CEO of Bob Jane Corporation.
RJR contends that, as at the priority date, it was the owner of the RJR marks because it (through Mr Jane) authored the marks and controlled the first use of the marks as trade marks in respect of alloy wheels by Bob Jane Corporation. RJR argues that all relevant conduct undertaken by Mr Jane was undertaken by him in his capacity as the sole director of RJR and not in his capacity as a director and CEO of Bob Jane Corporation. RJR says that it was always its intention to license Bob Jane Corporation to use the RJR marks under the control of RJR.
MEC contends that, as at the priority date, Bob Jane Corporation was the owner of the RJR marks because it authored the marks and had been using the marks since about May 2013. MEC says that, despite Mr Jane’s testimony to the contrary, the documentary record shows that all relevant steps taken in the creation and use of the RJR marks before the priority date were taken by or on behalf of Bob Jane Corporation.
To resolve the dispute, it is necessary to have close regard to the evidence concerning the creation and first use of the RJR marks. Before turning to that evidence, it is helpful to refer to the applicable legal principles (about which there was no dispute between the parties).
2.2 Legal principles
Section 58 of the Act provides that registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark. The word “owner” is not defined in the Act. Its meaning has been established by a number of decisions, reflecting both the common law origins of trade mark rights and the statutory provisions. Most relevant for present purposes are the decisions of the Full Court of the Federal Court in Food Channel Network Pty Ltd v Television Food Network GP (2010) 185 FCR 9 (Food Channel) and Pham Global. Those decisions establish the following principles:
(a)While at common law, rights in a trade mark are established by use, the Act allows an applicant to obtain title to a trade mark prior to use so long as the requirements in s 27 of the Act are met. Those requirements are that the applicant claims to be the owner of the trade mark and the applicant is either using or intends to use (or authorises or intends to authorise another to use) the mark in relation to the goods or services concerned: Food Channel at [49]; Pham Global at [18].
(b)In respect of a mark that has not been used prior to the application for registration, the basis of a claim to ownership has been found in the combined effect of authorship of the mark, the intention to use it upon or in connection with the goods and the application for registration: Food Channel at [52] citing Shell Company of Australia Ltd v Rohm and Haas Company (1949) 78 CLR 601 at 627 per Dixon J; Pham Global at [18] and [19].
(c)In respect of a mark that has been used prior to the application for registration, ownership is established by authorship of the mark and prior use: Food Channel at [55]; Pham Global at [19].
(d)An intention to use the trade mark may be inferred from the making of an application to register the mark: Food Channel at [67], [70] and [72].
(e)The question of ownership is to be determined as at the date of application for registration: Pham Global at [14], [31].
(f)The ground of opposition in s 58 is not confined to a party itself claiming ownership of the trade mark. The ground can be established by any third party showing that the applicant is not the owner: Food Channel at [58]. However, the court should be cautious to allow the legal fiction of the corporate veil to defeat registration in a case where one of a group of companies, all controlled by the same directing mind and will, used the mark prior to the other: Food Channel at [61].
(g)The burden of proof to establish the ground of opposition under s 58 is on the opponent. If the evidence is not sufficiently clear to enable a finding of fact to be made about ownership of the mark at the time of registration, the opponent will fail on that ground of opposition: Food Channel at [48].
Authorship of a trade mark involves the origination or first adoption of the word or design as and for a trade mark: Shell Company of Australia Ltd v Rohm and Haas Company (1949) 78 CLR 601 at 628 per Dixon J; applied in Aston v Harlee Manufacturing Co (1960) 103 CLR 391 at 399 per Fullagar J.
In E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144, French CJ, Gummow, Crennan and Bell JJ approved (at [43]) the statement by the Full Court of the Federal Court in Coca-Cola Co v All-Fect Distributors Ltd (1999) 96 FCR 107 at [19] (Coca-Cola) that:
“Use ‘as a trade mark’ is use of the mark as a ‘badge of origin’ in the sense that it indicates a connection in the course of trade between goods and the person who applies the mark to the goods … That is the concept embodied in the definition of “trade mark” in s 17 – a sign used to distinguish goods dealt with in the course of trade by a person from goods so dealt with by someone else.”
As observed by their Honours (at [42]), the essential characteristics of a trade mark are distinguishing goods of a registered owner from the goods of others and indicating a connection in the course of trade between the goods and the registered owner. A use of a mark in an advertisement of goods is a use in the course of trade and is a use in relation to the goods advertised: Shell Company of Australia Ltd v Esso Standard Oil (Aust) Ltd (1963) 109 CLR 407 at 422 per Dixon J; Moorgate Tobacco Co Ltd v Philip Morris Ltd (No 2) (1984) 156 CLR 414 at 433-434 per Deane J (Gibbs CJ and Mason, Wilson and Dawson JJ agreeing).
Ownership based on first use of a trade mark can be established through use by an authorised user. Section 7(3) of the Act provides that: “An authorised use of a trade mark by a person (see section 8) is taken, for the purposes of this Act, to be a use of the trade mark by the owner of the trade mark”.
The expressions “authorised user” and “authorised use” are defined in s 8 of the Act in the following terms:
(1)A person is an authorised user of a trade mark if the person uses the trade mark in relation to goods or services under the control of the owner of the trade mark.
(2)The use of a trade mark by an authorised user of the trade mark is an authorised use of the trade mark to the extent only that the user uses the trade mark under the control of the owner of the trade mark.
(3)If the owner of a trade mark exercises quality control over goods or services:
(a) dealt with or provided in the course of trade by another person; and
(b) in relation to which the trade mark is used;
the other person is taken, for the purposes of sub-section (1), to use the trade mark in relation to the goods or services under the control of the owner.
(4)If:
(a) a person deals with or provides, in the course of trade, goods or services in relation to which a trade mark is used; and
(b) the owner of the trade mark exercises financial control over the other person’s relevant trading activity; and
the other person is taken, for the purposes of sub-section (1), to use the trade mark in relation to the goods or services under the control of the owner.
(5)Sub-sections (3) and (4) do not limit the meaning of the expression under the control of in sub-sections (1) and (2).
Sections 8(2) and (3) are deeming provisions that identify a number of situations in which a person will be taken to use a registered mark under the control of the owner: Dunlop Aircraft Tyres Ltd v Goodyear Tire & Rubber Company (2018) 134 IPR 220 at [75] per Nicholas J (Dunlop). However, by virtue of s 8(5), ss 8(3) and 8(4) are not exhaustive of what may constitute control for the purpose of s 8(1) and (2): Caesarstone Ltd v Ceramiche Caesar SpA (No 2) (2018) 133 IPR 417 at [592] per Robertson J (Caesarstone).
Control must be exercised by a putative trade mark owner over the activities of the trade mark user such that the essential function of the trade mark, set out in s 17, is maintained. In Pioneer Kabushiki Kaisha v Registrar of Trade Marks (1977) 137 CLR 670, Kitto J stated that (at 683):
…the essential requirement for the maintenance of the validity of a trade mark is that it must indicate a connexion in the course of trade with the registered proprietor, even though the connexion may be slight, such as selection or quality control or control of the user in the sense in which a parent company controls a subsidiary. Use by either the registered proprietor or a licensee (whether registered or otherwise) will protect the mark from attack on the ground of non-user, but it is essential both that the user maintains the connexion of the registered proprietor with the goods and that the use of the mark does not become otherwise deceptive.
Control under s 8 of the Act means actual control in relation to the use of the trade mark, which involves questions of fact and degree. There must be control as a matter of substance. The mere fact that the registered owner granted a licence to use the trade mark is not sufficient to establish control within s 8: Lodestar Anstalt v Campari America LLC (2016) 244 FCR 557 at [97] per Besanko J (Allsop CJ, Greenwood and Nicholas JJ agreeing) (Lodestar). His Honour also observed:
[95] The meaning of “under the control of” in s 8 is informed by the principle stated by Aickin J in Pioneer, that is to say, that the trade mark must indicate a connection in the course of trade with the registered owner. The connection may be slight, such as selection or quality control or control of the user in the sense in which a parent company controls a subsidiary. It is the connection which may be slight. Aickin J was not saying the selection or quality control or financial control which may be slight.
…
[98] As I have said, actual control will be a question of fact and degree. A licence agreement may contain a term that sets out in detail a quality standard to be achieved. The details in the agreement may be such that it is not necessary for the registered owner to give directions or instructions from time to time. The licensee, aware of its obligations, may faithfully comply with those obligations without any entreaties or demands from the licensor.
Control for the purposes of s 8 may be established by many factors. As set out above, s 8(3) stipulates that exercising quality control over the relevant goods or services establishes control; and s 8(4) stipulates that exercising financial control over the trading activities of the user establishes control. In Caesarstone, Robertson J observed that it was sufficient that the registered owner was responsible for the manufacture of the goods (Caesarstone slabs) and gave instructions to the user as to how the goods should be transported to ensure their quality (at [595]); in that manner, the registered owner provided sufficient control over the wholesaling and retailing of the goods (at [597]). In that case, the control went further and included many obligations as to the promotion, fabrication and installation of the goods (described at [598] and [599]). In Dunlop, Nicholas J found that control was established by virtue of the financial and managerial control that the parent company (being the registered owner) exercised over its Australian subsidiary (being the relevant trade mark user) (at [85]-[88]).
In contrast, a licence agreement without more may be insufficient to establish control, at least where it has no effect on the way in which the user conducts its business: Lodestar at [97] and [103]. Similarly, a commonality of directors does not, without more, establish control, in circumstances where the registered owner is a subsidiary of the relevant trade mark user: Trident Seafoods Corp v Trident Foods Pty Ltd (2018) 137 IPR 65 at [100] per Gleeson J.
2.3 Factual history
The evidence concerning RJR and the history of the creation and use of the RJR marks was primarily given by Mr Jane.
Mr Jane is the son of Bob Jane who founded the business which trades as “Bob Jane T-Marts”. The business began in around 1965 with a single automotive tyre store in Melbourne. In 1972, the first Bob Jane T-Marts franchise was granted to a franchisee in New South Wales. In the 1970s and 1980s the business grew, with outlets being established in Brisbane, Sydney and the Australian Capital Territory and elsewhere. The business is now one of Australia's leading automotive tyre and wheel retailers. It is comprised of company owned stores operated by Bob Jane Corporation and franchised stores operated by third parties under licence from Bob Jane Corporation. Bob Jane T-Marts stores are located in every capital city and major regional area throughout Australia and, as at January 2015, there were approximately 135 stores in Australia (of which approximately 45 were company owned stores and the balance were franchise stores). At all relevant times, all of the shares in Bob Jane Corporation have been held by Bob Jane Holdings Pty Ltd and all of the shares in that company have been held by Mr Jane’s mother, Geraldine Jane. Mr Jane has been a director of Bob Jane Corporation since 2000, and is one of two directors today, the other being Alex Ying-Lee Chung. Mr Jane has also been the Chief Executive Officer of Bob Jane Corporation since 2002 and, in that capacity, has responsibility for the management of Bob Jane Corporation and the Bob Jane T-Marts business.
RJR was incorporated in 2002. Mr Jane is the sole director of the company and responsible for all aspects of its business. RJR has no employees. Since 2006, RJR has been owned by Mr Jane’s mother, Geraldine Jane. Following its incorporation, the principal activity of RJR was the development and promotion of the Rodney Jane Racing motorsport brand including the brand name “RJR Wheels”, which has been used in relation to wheels on performance vehicles.
On 22 June 2009, RJR and Bob Jane Corporation entered into a licence agreement (2009 Agreement) by which RJR granted Bob Jane Corporation an exclusive licence to use the “RJR Wheels” brand and Bob Jane Corporation agreed to promote that brand as its principal brand of wheels across all Bob Jane T-Marts stores. The 2009 Agreement was executed by Mr Jane on behalf of RJR and by Alex Chung (the other director of Bob Jane Corporation) and Mr Jane on behalf of Bob Jane Corporation. Mr Jane gave evidence that, thereafter, a range of brands and logos were developed for RJR to use to market various models of wheels. The development of wheel designs became a “pet project” for Mr Jane and he kept this work within RJR, being the company bearing his name, rather than Bob Jane Corporation.
Mr Jane gave evidence that he began giving serious consideration to the idea of developing a range of “Monster” branded wheels in about early 2010. Mr Jane explained that his interest in “Monster” as a brand name emanated from an interest he had with Monster Trucks when he was younger. In particular, he recalled that, in about 1987, Bob Jane Corporation modified a Holden Rodeo pick-up to create the Bob Jane Monster Truck which was used in events and for promotional purposes. Monster Truck events have been held at Calder Park Raceway, of which Mr Jane is a director. Mr Jane recalled attending a Monster Truck event at Calder Park Raceway in early 2010 at which the crowd was estimated to be in the tens of thousands. Mr Jane gave evidence that:
For me, the word “Monster” in an automotive context always conjured up images in my mind of Monster Trucks and what they represent – big, strong, car-crushing vehicles with oversized tyres and wheels. About a decade ago, I became aware of the growing market in Australia for pick-up style utes, 4WDs and off-road vehicles …. I considered that the owners of such vehicles would be attracted to alloy wheels and chunky tyres that enhanced the appearance of their vehicles and matched the image of their vehicles.
When cross-examined, Mr Jane explained his conception of “Monster” as a brand in the following terms:
I had grown up around monster trucks. We had, you know, a Holden Rodeo monster truck with a 455 Oldsmobile motor in it that I used to drive...
…we used to have monster shows at – monster truck shows out at Calder. The orientation of the brand “Monster”, you know, for me growing up, you know, every kid thought a monster truck was the coolest thing they had ever seen…
…I had an F250 when my son, Max, was born, that we used to tow a race car around with, and ultimately I kept driving after that. You know, he used to call it a monster truck…he was obsessed with two things – monster trucks and football. And, you know, I think that really reignited my interest in this – this concept of pickup trucks with, you know, monster, and you know, the fact that the the emerging vehicle at the time was a, you know, was a Hilux. It was becoming the biggest selling car in Australia, and at the same time there was a massive decline in Commodore and Falcon, you know, coming at us, which was our biggest wheel market. So you know, it worked perfectly, Monster as a brand, to fit that market, as – as a monster truck, you know.
In February 2011, RJR lodged a trade mark application in class 12 for the word “Monster”. The application did not pass examination and lapsed in September 2012. Notwithstanding the lapse of that application, Mr Jane remained interested in the brand name “Monster” for a new range of tyres and wheels to appeal to the 4WD and off-road vehicle market. Mr Jane considered that the word “Monster” complemented the image he had already developed in relation to the Rodney Jane Racing wheels but directed more towards pick-up style vehicles.
In about March 2013, Mr Jane requested the assistance of Zsuzsanna Zalatnai in developing logos to be used in conjunction with the “Monster” brand on a range of alloy wheels. At all times since February 2013, Ms Zalatnai has been the National Marketing Manager for Bob Jane T-Marts. She was initially employed by Bob Jane Corporation; however, on a date she could not recall, Ms Zalatnai became an employee of Advertising Development Services Pty Ltd (while continuing to perform the role of National Marketing Manager for Bob Jane T-Marts). Mr Jane gave evidence that he is “the shareholder” of Advertising Development Services Pty Ltd but not a director and that Advertising Development Services Pty Ltd provides marketing services to the Bob Jane T-Marts business. Mr Jane requested Ms Zalatnai to have someone draw up some possible logos for the “Monster” brand. Mr Jane instructed Ms Zalatnai that a prominent colour used in the “Monster” brand should be red and that the logo should conjure up a visual suggestion of a monster with eyes and a mouth.
Ms Zalatnai gave evidence that she engaged a graphic designer, Drafthouse Creative Studio, and that they sketched out four draft logos which they provided to Ms Zalatnai in early April 2013. Their work was billed to Strohfeldt Consulting, which was the advertising agent for the Bob Jane T-Marts business. Strohfeldt Consulting managed the designers ordinarily engaged by the Bob Jane T-Marts business and Drafthouse Creative Studio was one of those designers.
Mr Jane gave evidence that, in early April, Ms Zalatnai provided him with some draft logo designs. There is no documentary record of that but, on 9 April 2013, Ms Zalatnai sent an email to Mr Jane which appears to assume an earlier communication. The email was sent to the address [email protected] and attached four designs for the “Monster” logo. The email had the subject line “Feedback please – Monster logo” and stated (in part):
Hi Rodney,
Sorry to hassle you with this, but I am just cautious of the deadline for the logo. We would really need some feedback/direction from you. (My understanding is that we need to finalise this by Friday)
Mr Jane replied by email later that day in the following terms (errors in the original):
HI Zsuzsa
Sorry for delay I like 4 the most and kids think iys the best also.
I would consider in the cap logo adding some Red maybe the symbol and use a black background with silver monster and Bob Jane writting.
Thanks Rod
The logo selected by Mr Jane became the marks the subject of this proceeding. Having selected the logo, Mr Jane requested Ms Zalatnai to have three dimensional mocks-ups of alloy wheels with the logo on the hubcap created for his review. On 15 April 2013, Strohfeldt Consulting issued an invoice in an amount of $1,980 for “Monster wheels logo. Four concepts developed plus selected concept mock up for wheel example centre cap”. The invoice was addressed to “Advertising Development Services Pty Ltd | Bob Jane T-Marts”. Pictures of the three dimensional mock-ups of alloy wheels with the logo on the hubcap were attached to the invoice.
Mr Jane gave evidence that, in the period March to May 2013, he had various discussions with Dean Hockley, who was then the National Sales Development Manager for Bob Jane T-Marts, and Phil Weir, who was the International Sales and Marketing Manager for Mullins Wheels Pty Ltd (Mullins Wheels), regarding the production and sale of wheels bearing the RJR marks. Mullins Wheels distribute alloy wheels in Australia. Mr Jane had known and dealt with Mr Weir and Mullins Wheels since the late 1990s. The effect of Mr Jane’s evidence was that, in these discussions, he was seeking to develop and have produced a “Monster” wheel style for RJR, he wanted the wheel to be produced by Mullins Wheels and he wanted the wheel to be marketed and sold exclusively through Bob Jane T-Marts stores. Hence it was necessary for Mr Jane, Mr Weir and Mr Hockley to meet and discuss the commercial arrangements. Mr Jane stated that his discussions with Mr Weir concerned the appearance of the wheel (which was to be an aggressive, black, four wheel drive wheel for utes) and the characteristics of the wheel (load ratings, diameter and width). Mr Jane was confident that Mullins Wheels would produce a wheel that complied with all Australian standards and legal requirements and was safe and would not fail because he had dealt with Mullins Wheels for a long time. Correspondingly, the discussions involving Mr Hockley concerned the number of wheels that Mr Hockley believed could be sold through Bob Jane T-Marts, which dictated minimum manufacturing quantities and the production cost, which in turn affected the commercial viability of the product. Mr Jane selected a wheel offered by Mullins Wheels called the “Jackal”.
On 10 April 2013, Mr Hockley sent an email to Mr Jane with respect to a proposed program for the ordering, production and supply of “Monster” wheels by Mullins Wheels to Bob Jane T-Marts stores. Although the email commences with the sentence “Hello Rod and I have attached the proposed pricing schedule for the new Monster Wheels ‘Black-Jack’ program”, it is apparent that Mr Jane was the intended recipient of the email (the word “and” being a typographical error). The email contains proposed details for the commercial arrangements for the production of the “Monster” wheels including pre-ordering, lead times, delivery, management of inventory and pricing, and concludes with a request for Mr Jane’s approval as follows (error in original):
Rod I do believe that this is a good opportunity for BJC and the stores and if you are happy with the pricing matrix and the overall program we can commence the pre-sell to gauge store commitment to the program as Mullins will need to see that 600 unit initial commitment from stores to get the program rolling.
Can discuss when your available.
On 15 April 2013, Mr Weir sent an email to Mr Hockley titled “Bob Jane Black Jackal” asking, amongst other things, whether Mr Hockley had obtained the “decal sign off for the black (sic) Jackal”.
On 29 April 2013, Mr Hockley sent an email to John Kulikowski who worked in telesales for Bob Jane Corporation. The email was a copy of the email that Mr Hockley had sent to Mr Jane on 10 April 2013.
On 1 May 2013, Mr Hockley sent an email to Mr Jane, at his email address [email protected], and copied to Mr Kulikowski, containing a draft email proposed to be sent to Bob Jane T-Marts stores to announce and promote the “Monster” wheels and to seek pre-orders from the stores. The email had the title “Monster Wheels Program” and commenced as follows (error in original):
Hello Rod and below is the draft email for the stores on the Monster Wheel Program. Can you please review as I would like to send this out today to get the pre-orders rolling. The artwork has been sent to the factory to get the decal underway and they will send a sample for sign off as soon as it is completed.
The draft email to Bob Jane T-Marts stores followed that opening paragraph, and commenced as follows (errors in original):
Hello T-Marts,
I am very excited to release the new Monster Wheels brand to the RJR stable. This new brand will be targeted at the 4x and SUV market. The 1st style to be introduced into the Monster Wheels range is the "Black-Jack". The "Black-Jack" will be supplied by Mullins wheels as an exclusive product for Bob Jane T-Marts. Size and pricing details are on the attached. The wheels will be warehoused and distributed by Mullins Wheels.
Mr Jane gave evidence that he amended the draft email to Bob Jane T-Marts stores because he did not consider that Mr Hockley “had described well enough what Monster was really standing for” and Mr Jane wanted to “make a statement to the stores of the market we were chasing with this product”. Mr Jane stated that the market he wanted to chase was the “ute and 4x4 market…with an aggressive wheel which typically comes with an aggressive tyre” and that the “Rodney Jane Racing concept of Monster was to go and chase that market”. After Mr Jane had amended the draft email, the email was then sent by Mr Hockley to Bob Jane T-Marts stores on 2 May 2013 in the form approved by Mr Jane. The email commenced as follows (errors in original):
Hello T-Marts,
We are very excited to release the new Monster Wheels brand to the RJR stable. This new brand will be targeted at the 4x4 and SUV market. The lst style to be introduced into the Monster Wheels range is the "Black-Jack". The "Black-Jack" will be supplied by Mullins wheels as an exclusive product for Bob Jane T-Marts. This is a trial program and will require everyone's support to ensure its success, the ongoing exclusivity is dependent upon continued volume. The 4x4 / SUV segment continues to grow and some of our competitors are very strong within this arena. The new "Black-Jack" covers a large range of vehicles and todays best sellers. Such as Toyota Hi-Lux, FJ Cruiser, Mitsubishi Triton & Holden Colorado just to name a few. In the 16x8 we have the 45 offset to suit new Few Ford Ranger and Mazda BT50. This fitment is currently being developed in 17x8 also and we expect to have this ready for July production. This market segment represent a great opportunity as the demand to dress up these vehicles is strong, dealer work is also great as they looking for that point of difference to attract both tradies and 4x4 enthusiasts alike.
Size and pricing details are below and also attached. The range has been priced aggressively with the "Black Jack" being $30 to $40 per wheel cheaper than the YHI Crawler. The wheels will be warehoused and distributed by Mullins Wheels.
Mr Jane gave evidence that he approved the email “from the Rodney Jane Racing perspective” to ensure that it represented what Mr Jane was trying to do from an RJR point of view. Mr Jane also said that he is not ordinarily involved in approving product announcements relating to Bob Jane Corporation products. The implication of his evidence was that he was involved in the product announcement relating to the “Monster” wheels because they were an RJR product.
On 22 May 2013, RJR filed trade mark application numbers 1558366, 1558367 and 1558368. Those applications were identical to the marks the subject of this proceeding, save that the applications sought to register the marks in classes 12, 35, 37 and 41.
On 17 June 2013, Mr Weir of Mullins Wheels sent an email to Mr Kulikowski stating that Mullins Wheels required a letter from Bob Jane Corporation authorising it to commence production of wheels bearing the RJR marks. Mr Jane gave evidence that that authorisation was not given until RJR had licensed the use of the marks to Bob Jane Corporation. That occurred two days later.
On 19 June 2013, RJR and Bob Jane Corporation entered into a further licence agreement (2013 Agreement) pursuant to which RJR granted Bob Jane Corporation a non-exclusive, non-assignable, worldwide licence to use various trade marks listed in Schedule 1 to the agreement (which included the RJR marks) in respect of the promotion and sale of goods and services for which the marks were registered or sought to be registered. The recitals to the 2013 Agreement recorded that RJR was the owner of all of those trade marks. Bob Jane Corporation agreed to pay RJR licence fees for its use of the RJR marks and provided RJR with the right to exercise quality control over Bob Jane Corporation’s use of the marks. In respect of quality control, cl 5.1 stipulated that:
BJC will use its best endeavours to protect the integrity of the RJR brand and ensure the highest quality of manufacture promotion and display of any goods or services sold or promoted under the RJR Marks pursuant to this Agreement. BJC shall also use its best efforts to ensure that goods and services sold or promoted by BJC under the RJR Marks shall comply with all applicable laws and standards.
Clause 5.6 stipulated that:
RJR shall have the right to exercise quality control over BJC's use of the RJR Marks to a degree reasonably necessary to maintain validity of the RJR Marks and to protect the goodwill associated therewith. BJC shall use the RJR Marks only on or in connection with goods and services that conform to the specifications and standards of quality which RJR prescribes, and will not deviate materially from such standards without prior written approval from RJR. In order to verify compliance, RJR may from time to lime require BJC to submit samples and other marketing or promotional items bearing the RJR Marks for approval.
Also on 19 June 2013, and according to Mr Jane after the 2013 Agreement had been executed, Mr Chung (a director of Bob Jane Corporation) sent a letter to Mullins Wheels formally authorising it to arrange production of up to 2,500 alloy wheels bearing the RJR marks.
There was no evidence that RJR had ever prescribed specifications or standards for the wheels on which the RJR marks were to be used in writing, as contemplated by cl 5.6 of the 2013 Agreement. However, Mr Jane gave evidence that he selected Mullins Wheels as the producer of the Monster wheels because he had dealt with them for a long time and Mr Jane believed that Mullins Wheels were very familiar with the requirements for wheels to suit vehicles in Australia, from a safety and quality perspective. Mr Jane also gave the following evidence with respect to his supervision of the quality of the “Monster” wheels, in his dual capacities as a director of RJR and the CEO of Bob Jane Corporation:
(a)Mr Jane conducted personal inspections to check the quality of “Monster” wheels that were being supplied, as part of his regular visits to Bob Jane T-Marts stores.
(b)At various times since June 2013, Mr Hockley consulted Mr Jane in relation to various wheel designs, including in relation to designs featuring the possible use of the RJR marks. Before Mr Hockley could order any new “Monster” wheel model from Mullins Wheels, he was required to consult with Mr Jane and obtain his approval.
(c)In about 2016, PDW Group replaced Mullins Wheels as the preferred manufacturer of “Monster” wheels. During that process, Mr Jane attended and participated in meetings with the PDW Group to satisfy himself that they were capable of producing alloy wheels of a sufficiently high quality for sale under the RJR marks.
(d)Mr Jane continued to review sample wheel designs from time to time to determine which styles would be future models to be sold in the Bob Jane T-Marts system as “Monster” wheels.
Pursuant to the Franchising Code of Conduct, Bob Jane Corporation is required to update its Disclosure Document for franchisees and potential franchisees each year. The 2015 Disclosure Document lists the three RJR marks on the list of trade marks used in the Bob Jane T-Marts business and records that the marks are owned by RJR.
Bob Jane Corporation paid RJR licence fees, in accordance with the 2013 Agreement, in return for RJR granting it permission to use the RJR marks. For the period from August 2013 to January 2015, the licence fees paid by Bob Jane Corporation to RJR totalled $4,918.55.
In August 2013, the trade mark applications that had been filed in May 2013 met with adverse reports, primarily due to the existence of the word mark 701401 “Monster” in class 12 owned by Ducati Motor Holding SpA. The adverse reports were not answered by their deadline of 23 October 2014 and Mr Jane decided to allow those applications to lapse, and then instructed his solicitors to file fresh applications. Applications for the marks the subject of this proceeding were then filed on 27 January 2015 in the name of RJR. Those applications were only filed in class 12 and were in relation to alloy wheels for automobiles excluding motorbikes. On 10 February 2015, RJR and Bob Jane Corporation signed an “Addendum” to the 2013 Agreement that substituted the 2015 trade mark application numbers for the original 2013 trade mark application numbers.
2.4 Disposition of the section 58 issue – RJR is the owner of the RJR marks
As at the priority date, there had been prior use of the RJR marks by Bob Jane Corporation. The parties are agreed that the first use of the RJR marks occurred through the email sent by Mr Hockley to Bob Jane T-Marts on 2 May 2013. There was then further use of the RJR marks before the priority date through the promotion and sale of alloy wheels bearing the marks. In those circumstances, ownership is established by the authorship of the RJR marks and the prior use. The relevant questions are:
(a)was RJR or Bob Jane Corporation the author of the RJR marks; and
(b)was the use of the RJR marks by Bob Jane Corporation use as an owner or as an authorised user under the control of RJR as owner?
Authorship
In relation to authorship, the evidence establishes that Mr Jane conceived the idea of “Monster” branded wheels and directed the creation of the logos which became the RJR marks. MEC argues that the evidence supports the conclusion that, in doing so, Mr Jane was acting in his capacity as the CEO of Bob Jane Corporation and not in his capacity as the director of RJR. In support of that contention, MEC relies principally on the fact that Mr Jane asked Ms Zalatnai to help him develop the logos, Ms Zalatnai being the National Marketing Manager for Bob Jane T-Marts, and that Ms Zalatnai engaged Drafthouse Creative Studio to create the logos, which was a design firm used by Bob Jane T-Marts’ advertising agency, Strohfeldt Consulting. The invoices for the work were addressed to Bob Jane T-Marts. Various communications about the logos were sent by email to Mr Jane at the address [email protected], the domain name for which is owned by Bob Jane Corporation.
Taken on their own, the foregoing facts might support a conclusion that Mr Jane was acting in his role as CEO of Bob Jane Corporation in directing the creation of the RJR marks. The facts cannot, however, be taken on their own. Mr Jane gave evidence that he created the RJR marks in his capacity as director of RJR and the surrounding facts, outlined earlier, are consistent with and corroborate his evidence. The key facts are the following.
First, the RJR business includes responsibility for the management of some of the intellectual property relating to the Bob Jane T-Marts business. Upon its incorporation, RJR’s principal activity was the development and promotion of the Rodney Jane Racing motorsport brand and associated intellectual property, including the brand “RJR Wheels”. In 2009, RJR entered into a licensing agreement with Bob Jane Corporation in respect of that brand (the 2009 Agreement). Under that agreement, Bob Jane T-Marts sold wheels bearing that brand. Thus, prior to the creation of the RJR marks, there had been a commercial relationship between RJR and Bob Jane Corporation for the licensing of trade marks owned by RJR.
Second, in 2011 RJR applied for registration of the word “Monster” as a trade mark. That act corroborates Mr Jane’s evidence that, in taking steps to create the “Monster” trade mark, Mr Jane was doing so on behalf of RJR.
Third, on 22 May 2013, RJR filed the original trade mark applications in respect of the RJR marks. Again, that act corroborates Mr Jane’s evidence that his prior actions in creating the RJR marks were undertaken by him in his capacity as director of RJR and not in his capacity as CEO of Bob Jane Corporation.
Fourth, shortly after the creation of the RJR marks, RJR and Bob Jane Corporation entered into a licence agreement in respect of the marks (the 2013 Agreement). While entering into that Agreement cannot, of itself, change the facts that occurred prior to the date of the Agreement, it sheds light on the proper characterisation of the prior events. It confirms Mr Jane’s belief, and an understanding between the corporate entities, that the creation of the RJR marks had been undertaken by Mr Jane in his capacity as director of RJR, not in his capacity as CEO of Bob Jane Corporation.
Fifth, Bob Jane Corporation has complied with the 2013 Agreement, paying royalties to RJR in accordance with the Agreement. Bob Jane Corporation has never challenged RJR’s ownership of the RJR marks.
Given the above facts, there is no reason to doubt Mr Jane’s evidence that in creating the RJR marks he was acting in his capacity as director of RJR. I accept his evidence. That evidence is not contradicted by the fact that Mr Jane utilised the services of employees and contractors of Bob Jane Corporation in order to undertake design work. Given the corporate and commercial relationship between RJR and Bob Jane Corporation, and Mr Jane’s intention that the RJR marks would be licensed to Bob Jane Corporation, it is understandable that RJR might utilise design services available through Bob Jane Corporation while creating trade marks that would be owned by RJR. The fact that various communications were sent to Mr Jane at his email address [email protected] is of little moment. There is no evidence that RJR had a domain name for emails or that Mr Jane had any other email address (although the evidence shows that RJR had letterhead). Mr Jane’s evidence was that he rarely used emails and preferred to communicate directly with people in the office using printed documents where necessary.
For the reasons given above, I am satisfied that RJR was the author of the RJR marks. MEC has the onus of proving that RJR was not the owner, either by proving that RJR was not the author of the RJR marks or was not the first user. It has failed to discharge the onus of proving that RJR was not the author.
Prior use
In relation to prior use, the evidence establishes that Mr Jane selected the producer of the wheels that would bear the RJR marks, Mullins Wheels, selected the style of wheel to be produced, directed the first communication and promotion of the “Monster” wheels to Bob Jane T-Marts stores and then continued to review and control alterations to wheel styles and the producer of the wheels. Again, MEC argues that the evidence supports the conclusion that, in undertaking those tasks, Mr Jane was acting in his capacity as the CEO of Bob Jane Corporation and not in his capacity as the director of RJR. The evidence relied upon by MEC in support of that argument are the facts that: Mr Hockley, the National Sales Development Manager of Bob Jane T-Marts, was involved in establishing the commercial arrangements with Mullins Wheels for the supply of wheels bearing the RJR marks; the “Monster” wheels were first promoted to Bob Jane T-Marts stores through an email sent on 2 May 2013 by Mr Hockley; a director of Bob Jane Corporation, Mr Chung, authorised Mullins Wheels to apply the RJR marks to the wheels being supplied by Mullins Wheels; and the “Monster” wheels were sold through Bob Jane T-Marts stores.
There is no dispute between the parties that Bob Jane Corporation was a user of the RJR marks. The dispute is whether Bob Jane Corporation was an authorised user of the marks under the control of RJR as owner such that its use is taken, for the purposes of the Act, to be a use of the marks by RJR (pursuant to s 7(3) of the Act). The evidence, outlined above, supports the conclusion that Bob Jane Corporation was an authorised user of the RJR marks under the control of RJR as owner. The key facts concerning RJR’s control of the use of the RJR marks are the following.
First, Mr Jane selected the producer of the wheel to which the RJR marks would be applied, and selected the type of wheel (in terms of appearance and characteristics) that would be supplied. For the reasons explained in the context of the authorship of the RJR marks, in my view the evidence establishes that, in selecting the supplier and type of wheels to be supplied, Mr Jane was acting in his capacity as director of RJR.
Second, whilst dealing with Mr Weir from Mullins Wheels, Mr Jane was also directing Mr Hockley in relation to the commercial arrangements for the supply of wheels bearing the RJR marks. In doing so, it may be accepted that Mr Jane was acting in two capacities: as director of RJR and as CEO of Bob Jane Corporation. There was no necessary inconsistency or conflict in Mr Jane performing both roles. The circumstances are consistent with the apparent intention of the parties that Bob Jane Corporation would be an authorised user of the RJR marks.
Third, Mr Jane controlled the form of the email sent to Bob Jane T-Marts stores by Mr Hockley on 2 May 2013. The parties agree that that email constituted the first use of the RJR marks as trade marks. That is because the email involved the advertising and promotion of goods bearing the marks to Bob Jane T-Marts franchise stores. Mr Jane’s control over that communication is clear from the fact that Mr Hockley sent a draft to him for his approval on 1 May 2013 and Mr Jane made material changes to the draft email. The changes made by Mr Jane were to describe more fully the target market for the “Monster” wheels. The email itself identified RJR as the owner of the “Monster” wheels brand: it commenced with the sentence “We are very excited to release the new Monster Wheels brand to the RJR stable”. The evidence of Mr Jane was that he approved the revised email in his capacity as director of RJR and not in his capacity as CEO of Bob Jane Corporation. In my view, Mr Jane’s evidence is consistent with the surrounding facts and circumstances, and I accept his evidence.
MEC advanced a Jones v Dunkel submission in respect of the failure by RJR to call Mr Hockley as a witness, to the effect that an inference can be drawn that Mr Hockley’s evidence would not have been helpful to RJR’s case. I reject the submission. The rule in Jones v Dunkel permits, but does not require, a tribunal of fact to infer that the evidence of an absent witness, if called, would not have assisted the party who failed to call that witness: Jones v Dunkel (1959) 101 CLR 298 at 308 per Kitto J and 321 per Windeyer J; RPS v R (2000) 199 CLR 620 at [26] per Gaudron ACJ, Gummow, Kirby and Hayne JJ. However, the rule does not entitle a court to speculate about “what other evidence might possibly have been led”: ASIC v Hellicar (2012) 247 CLR 345 at [165] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ. The rule will not support an adverse inference unless the evidence otherwise provides a basis upon which that unfavourable inference can be drawn: Chong v CC Containers Pty Ltd (2015) 49 VR 402 at [208] per Redlich, Santamaria and Kyrou JJA. Further, the rule does not operate to require a party to give merely cumulative or corroborative evidence: Manly Council v Byrne [2004] NSWCA 123 at [61]-[65] per Campbell J (Beazley JA and Pearlman AJA agreeing); Seven Network Ltd v News Limited [2007] FCA 1062 at [473] per Sackville J. In the present case, Mr Jane gave direct evidence concerning the control he exercised over the use of the RJR marks by Bob Jane Corporation and the capacity in which he exercised that control. The documentary evidence and surrounding facts and circumstances were consistent with Mr Jane’s evidence. In those circumstances, there was no requirement for RJR to call Mr Hockley and there was no gap in the evidence required to be filled by Mr Hockley.
Fourth, on 19 June 2013, RJR and Bob Jane Corporation entered into a licence agreement in respect of various trade marks including the RJR marks. While that Agreement cannot alter the character of actions undertaken prior to the Agreement, it provides corroboration of the characterisation that is otherwise open on the evidence. In my view, the entry into the 2013 Agreement corroborates the fact that the earlier actions undertaken by Mr Jane controlling the use of the RJR marks by Bob Jane Corporation were undertaken in his capacity as director of RJR (as owner of the marks). That conclusion is also supported by the evidence showing that Bob Jane Corporation complied with the 2013 Agreement by paying royalties to RJR, and that Mr Jane continued to control the selection of the wheels bearing the RJR marks and the selection of the producer of those wheels.
For the reasons given above, I am satisfied that Bob Jane Corporation was, from the outset, an authorised user of the RJR marks under the control of RJR and that, as a consequence, RJR was the first user of the marks. MEC has failed to discharge the onus of proving that RJR was not the first user of the marks.
2.5 Disposition of the section 59 issue – RJR always intended to use the RJR marks
Section 59(a) of the Act provides that a trade mark may be opposed on the ground that the applicant does not intend to use, or authorise the use of, the trade mark in Australia. On this ground of opposition, MEC relies on materially the same evidence and arguments advanced in respect of s 58. It contends that the evidence shows that RJR did not exercise control over the use of the RJR marks by Bob Jane Corporation and never intended to use or authorise the use of the marks within the meaning of the Act.
In closing submissions, Senior Counsel for MEC conceded, quite properly, that the determination of the s 58 issue would be largely determinative of the s 59 issue. For the reasons given in the preceding section, I find that, as at the priority date, Bob Jane Corporation was an authorised user of the RJR marks under the control of RJR which is dispositive of the s 59 issue. Indeed, as at the priority date, RJR’s intention to authorise the use of the RJR marks in Australia is readily established by the combined effect of: the filing of the original applications for registration of the marks and the subsequent applications; the entry into the 2013 Agreement granting a licence to use the marks to Bob Jane Corporation; and the control (through Mr Jane) of the use of the marks exercised by Bob Jane Corporation.
3. LIKELY TO DECEIVE OR CAUSE CONFUSION
3.1 Overview
MEC also opposes registration of the RJR marks under ss 42(b) and 60 of the Act. On these grounds of opposition, the dispute between the parties is whether the use of the RJR marks would be likely to deceive or cause confusion because of the reputation of the MEC marks. As noted earlier, Senior Counsel for MEC acknowledged that if the Court found against it under s 60, it would follow that the Court would also find against it under s 42(b) of the Act. Accordingly, while some reference is made to s 42(b) below, the primary issue concerns s 60.
The evidence shows, and there is no dispute, that MEC has a strong reputation in Australia in its device marks which consist of the M-icon on its own or used in conjunction with the stylised depiction of the words “Monster Energy”. That reputation is as a producer of energy drinks and as a sponsor of extreme sports including motorsports. The extent of that reputation, particularly in relation to motorsports, is considered further below. The parties dispute whether MEC has a reputation in the word “Monster” that is distinct from its reputation in its device marks.
MEC acknowledges that the RJR marks and the MEC marks are not visually similar (and, contrary to the decision of the Registrar’s delegate below, the respective marks do not share “striking similarities”). MEC contends that the use of the RJR marks would be likely to cause confusion because a notional consumer, aware of the reputation of the MEC marks, would (as at the priority date):
(a)perceive the reference to “Monster” as signifying that the RJR marks were associated with MEC;
(b)perceive that the “Monster” design of the RJR marks differed from MEC’s M-icon; and
(c)conclude that the design of the RJR marks were those of MEC and another commercial entity with whom MEC had entered into a commercial relationship (and, in the case of the RJR marks bearing the name “Bob Jane”, the other commercial entity would be identified as Bob Jane Corporation or its business Bob Jane T-Marts).
In other words, MEC contends that the notional consumer would believe, or would be confused as to whether, MEC had entered into a commercial relationship with the producer of wheels bearing the RJR marks in the manner of brand extension, lending the MEC “Monster” name to a different logo.
MEC’s contention is based on the argument that the word “Monster” is the essential feature in each of the MEC marks (save for the M-icon when used alone); that it is dominant both visually and aurally in the MEC marks; and that the name “Monster” is the way in which the MEC marks would ordinarily be recalled and described by consumers. MEC submits that when the MEC marks are used on its energy drinks and in its extensive marketing activities, the word “Monster” is prominent whether that word is used by itself or in conjunction with the word “Energy”. MEC submits that the word “Monster” is reinforced where the M-icon is also used because the M-icon looks like the letter “M” and has a “monster-like vibe”.
On MEC’s case, the strength of MEC’s reputation in the word “Monster”, being an essential feature of the MEC marks (save for the M-icon when used alone), is such that a notional consumer (aware of that reputation) would be likely to associate the use of the word “Monster” in connection with automotive wheels with MEC, or at least be confused about such an association.
RJR contends that there is no likelihood of confusion arising from the use of the RJR marks (as at the priority date). In support of that contention, it makes the following arguments: MEC has a strong reputation in its device marks, but not in the word “Monster” alone; the reputation of the MEC marks is in relation to energy drinks and the sponsorship of extreme sports, but not in relation to the sale of automotive wheels; the word “Monster” has a descriptive meaning and there has been extensive third party use of that word as a trade mark in relation to a range of goods and services; there are striking dissimilarities between the RJR marks and the MEC marks; and the RJR marks are registered in relation to goods (alloy wheels) that are sold at a relatively high price and for which consumers make a considered purchasing decision.
3.2 Legal Principles
Section 60
Section 60 of the Act provides that 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.
The purpose of s 60 is to provide protection for prior well-known marks, whether registered or not: Explanatory Memorandum to the Trade Marks Amendment Bill 2006 at [4.10(1)].
The ordinary meaning of the word “reputation” is the recognition of a person or thing by the public generally or the estimation in which a person or thing is held by the public generally: McCormick & Co Inc v McCormick (2000) 51 IPR 102 at [81] (McCormick). The reputation of a trade mark has quantitative and qualitative dimensions. The quantitative dimension concerns the breadth of the public that are likely to be aware of the mark, which can be evidenced by the quantum of sales, advertising and promotion of goods or services to which the mark is applied. The qualitative dimension concerns the image and values projected by the trade mark, which affects the esteem or favour in which the mark is held by the public generally: see McCormick at [85]-[86].
There was no dispute between the parties as to the following general principles governing the application of s 60:
(a)First, the likelihood of deception or confusion from the use of the opposed mark must arise because of the reputation of the other mark: Delfi Chocolate Manufacturing SA v Mars Australia Pty Ltd (2015) 115 IPR 82 at [29] per Jessup J (Delfi). The Court must compare “mark and reputation” rather than “mark and mark”: Tivo Inc v Vivo International Corporation Pty Ltd [2012] FCA 252 at [306] per Dodds-Streeton J (Tivo), citing with approval Pfizer Products Inc v Karam (2006) 219 FCR 585 at [27] per Gyles J.
(b)Second, the reputation of the other mark is to be assessed at the priority date of the opposed application: Southern Cross at 595, cited in Pham Global at [21].
(c)Third, the relevant comparison is between the prior mark as actually used and a notional normal and fair use of the mark sought to be registered: Qantas Airways Ltd v Edwards (2016) 338 ALR 134 at [178] (Qantas). See also Berlei Hestia Industries Ltd v Bali Co Inc (1973) 129 CLR 353 at 362 (Berlei); Vivo International Corporation Pty Ltd v Tivo Inc (2012) 294 ALR 661 at [113]-[115].
(d)Fourth, s 60 is not constrained by the concept of deceptive similarity – the words of s 60 do not refer to resemblance at all. The question is purely one of prior reputation: Qantas at [142].
(e)Fifth, the test for confusion under s 60 is not limited to whether consumers might think that the respective marks are the same. It is sufficient that consumers might wonder whether the respective goods might be connected in the course of trade: Explanatory Memorandum, [4.10(3)]; McCormick at [82]; Southern Cross at 595. It is enough if consumers might think that the product bearing the impugned mark is a variant of, or related to, an existing brand: Southern Cross at 594-595, 597; Woolworths at [50]; Polo Textile Industries Pty Ltd v Domestic Textile Corporation Pty Ltd (1993) 42 FCR 227 at 229-230; Australian Postal Corporation v Digital Post Australia Pty Ltd (2013) 308 ALR 1 at [70] (Australian Postal Corporation).
(f)Sixth, there is no requirement that it be more probable than not that the use of the opposed mark will deceive or cause confusion. All that is required is that there is a real and tangible danger of confusion or deception. It is enough if the ordinary person entertains a reasonable doubt: Southern Cross at 595; Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd (2004) 209 ALR 1 at [76] (Crazy Ron’s). The creation of an incorrect belief or mental impression and causing confusion “may go no further than perplexing or mixing up the minds of the purchasing public…”: Coca-Cola at [39]; Tivo at [102] per Dodds-Streeton J. In Australian Postal Corporation, the Full Court stated (at [70]):
… the threshold for confusion is not high. Courts must compare the marks visually and aurally in the context of how the marks are used, and decide if there is a reasonable probability that the ordinary person to whom the marks are targeted, entertains a reasonable doubt as to the relationship between the marks. But there must be a realistic assessment, and a mere possibility of confusion is not enough.
(g)Seventh, evidence of actual confusion is not required: Berlei at 355 per Barwick CJ.
(h)Eighth, a mark may acquire a reputation in Australia through indirect exposure in the press, on television and on the internet: Tivo at [336] per Dodds-Streeton J; Hansen Beverage Company v Bickfords (Australia) Pty Ltd (2008) 171 FCR 579 at [64] per Finkelstein J.
The parties’ submissions were at variance on a number of matters, although the variance was mainly a matter of emphasis.
First, the parties placed different emphasis on the significance of the objective similarity of the marks in question. RJR emphasised statements in the cases to the effect that, in assessing the risk of confusion, the “degree of similarity between the allegedly conflicting marks will be a relevant consideration”: Qantas at [142] and [172] per Yates J; Singtel Optus Pty Ltd v Optum (2018) 140 IPR 1 at [205] per Davies J (Singtel Optus). Further, when considering a logo mark, all visual features must be considered, including font, the arrangement and use of graphic elements, the use of any corporate name, the orientation of the mark and its constituent parts, whether text is upper case or lower case, and the overall shape, geometricity and stylistic impression of the mark: Australian Meat Group Pty Ltd v JBS Australia Pty Ltd (2018) 363 ALR 113 at [71]-[73] (Australian Meat Group). In contrast, MEC emphasised that, while the respective marks must be considered as a whole, consumers are likely to have an imperfect recollection of the prior mark, retaining only a general recollection of that mark: Re Rysta Ltd’s Application (1943) 60 RPC 87 at 108; de Cordova v Vick Chemical Co (1951) 68 RPC 103 at 105-6 (de Cordova); Crazy Ron’s at [77]-[79]. For that reason, attention needs to be given to the “essential feature(s)” of the prior mark which would be recalled by the consumer, being the “idea which the mark will naturally suggest to the mind of one who sees it”, or a “significant” or “distinctive” element of the mark or aspect(s) of the mark, or the feature “which strikes the eye and fixes itself in the recollection”: Jafferjee v Scarlett (1937) 57 CLR 115 at 121-2; Saville Perfumery Ltd v June Perfect Ltd (1941) 58 RPC 147 at 162; de Cordova at 105-106; Crazy Ron’s at [74], [79]-[84]; Optical 88 Ltd v Optical 88 Pty Ltd (No 2) (2010) 275 ALR 526 at [108]-[110]. MEC submitted that confusion may result if that feature is then adopted in the trade mark of another. RJR countered with the submission that, under s 60, “a strong reputation is likely to militate against any likelihood of confusion where there are differences between the marks under comparison”: Singtel Optus at [205] per Davies J. This is because a consumer “with a stronger awareness of the respondent’s mark” is more likely to be “immediately struck by the differences between the two marks”: Delfi at [29] per Jessup J.
Second, the parties placed different emphasis on the similarity of the goods and services in respect of which the respective marks were used or intended to be used. MEC emphasised that the prior mark need not have established a reputation in Australia that is specific to the goods or services which are the subject of the opposed application: Hugo Boss AG v Jackson International Trading Co Kurt D Bruhl GmbH & Co KG (1999) 47 IPR 423 at 436-7 (Hugo Boss); McCormick at [85]; in Qantas at [143]. While RJR accepted the correctness of that principle, it placed reliance on observations made in a number of cases to the effect that it is a material consideration in the application of s 60: Singtel Optus at [203] per Davies J; Qantas at [143] per Yates J; Gain Capital UK Ltd v Citigroup Inc (No 4) (2017) 123 IPR 234 at [148] per Markovic J; Hills Industries Ltd v Bitek Pty Ltd (2011) 214 FCR 396 at [208] per Lander J. RJR also emphasised the relevance of the nature of the goods or services to which the opposed mark is sought to be registered and the characteristics of the class of consumers for those goods and services, as those factors bear upon the interest and likely attention of the relevant consumers in making a purchase and therefore the likelihood of confusion: Pham at [71]; Stone & Wood Group Pty Ltd v Intellectual Property Development Corporation Pty Ltd (2018) 357 ALR 15 at [19] and [63].
Third, there was some disagreement as to whether the use of the RJR marks before the priority date was relevant to the s 60 assessment. MEC submitted that the use or reputation of opposed marks is generally not relevant to the comparison of marks under s 60. The language of s 60 asks simply whether the use of the opposed mark is likely to deceive or cause confusion because of the reputation of the prior mark. The assessment is made by considering a notional normal and fair use of the opposed mark. MEC accepted that account could be taken of the notional consumer’s familiarity with an element of the opposed mark where that element has a degree of notoriety or familiarity of which judicial notice can be taken (such as the brand Woolworths): Woolworths at [61] per French J; CA Henschke & Co v Rosemount Estates Pty Ltd (2000) 52 IPR 42 at [52]; Crazy Ron’s at [90]; Australian Meat Group at [41]. However, it submitted that that principle has no application to the RJR marks. RJR submitted that it is well established that, when assessing whether a party (here MEC) had acquired a distinctive reputation in a mark, third party usage of that mark “weighs heavily against the conclusion” (Yarra Valley Dairy Pty Ltd v Lemnos Foods Pty Ltd (2010) 191 FCR 297 at [256]-[257] per Middleton J) and that third party usage will make it more difficult for a party to establish that use of that mark is likely to deceive (Telstra Corp Ltd v Phone Directories Co Pty Ltd (2014) 316 ALR 590 at [580] per Murphy J, in the context of passing off and misleading or deceptive conduct). RJR submitted that it followed that use of the RJR marks before the priority date would be relevant to the s 60 assessment in so far as that use diminished the likelihood that the MEC marks had acquired a distinctive reputation in the word “Monster” (also relying on Colorado Group Limited v Strandbags Group Pty Limited (2007) 164 FCR 506 at [136] per Allsop J). That proposition was accepted by MEC.
There was no disagreement between the parties that s 60 must be applied separately to each of the RJR marks and in respect of each of the MEC marks. It is therefore necessary to consider: what is the reputation of each of the MEC marks considered separately? In that respect, the primary contentions advanced by MEC recognised that it was MEC’s device marks, comprising the M-icon and the stylised depiction of the words “Monster Energy”, that had acquired a reputation in Australia, rather than the word mark containing the single word “Monster”. MEC’s primary contention was that the essential element of its device marks was the word “Monster”, such that consumers would be likely to be confused by the use of the RJR marks, which featured the brand “Monster”.
Section 42
Section 42(b) provides that an application for registration of a trade mark must be rejected if its use would be contrary to law. In that respect, MEC relies on ss 18 and 29 of the ACL. The principles governing the application of ss 18 and 29 are well established and neither party referred to them in any detail. The principles governing s 18 were recently summarised by Beach J in Flexopack S.A. Plastics Industry v Flexopack Australia Pty Ltd (2016) 118 IPR 239 at [259]-[277] (Flexopack). Similar principles govern the application of s 29 of the ACL: Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45 at [97]-[107]; ACCC v Coles Supermarkets Australia Pty Ltd (2014) 317 ALR 73 at [35]-[47]; Flexopack at [259]-[277].
There are, however, two important differences in the enquiry required by s 60 of the Act on the one hand and under ss 18 and 29 of the ACL on the other. First, the enquiry under s 60 requires consideration of whether the reputation of a pre-existing mark is likely to deceive or cause confusion; the enquiry under ss 18 and 29 is not so confined and all relevant circumstances can be considered. Second, under s 60 it is sufficient to show that consumers are given “cause to wonder” as to the source of the applicant’s goods, but that is not sufficient under the ACL: Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191 at 198 per Gibbs CJ; Google Inc v ACCC (2013) 249 CLR 435 at [8] per French CJ, Crennan and Kiefel JJ.
3.3 The reputation of the MEC marks
MEC adduced a substantial quantity of evidence concerning the use of the MEC marks in connection with the sale of its energy drinks and associated promotional activity in order to show the strength of the reputation in Australia of the MEC marks. That evidence was principally given by Mr Pontrelli, who is the Senior Vice President of Marketing for MEC, and by Mr Thiele, who is the Vice President – Oceania at Monster Energy AU Pty Ltd (the Australian subsidiary of MEC) (MEAU). RJR largely embraced the evidence of Messrs Pontrelli and Thiele, submitting that their evidence showed that each can of Monster Energy drink sold by MEC, and all of its associated promotional activity, whether by way of sponsorships or merchandising, prominently featured the device marks consisting of the M-icon and the stylised depiction of the words “Monster Energy”, not the word mark consisting of the plain (i.e. not stylised) word “Monster”. RJR argued that it was MEC’s device marks that had a strong reputation, not the word mark “Monster”, and that the strength of the reputation in the device marks reduced the likelihood of confusion from the use of the RJR marks. RJR’s submission is correct.
Energy drinks
The original Monster Energy drink was launched by MEC in the USA in April 2002 with a target audience of male consumers in the 18-34 age bracket. Between 2002 and the end of 2014, MEC sold more than 13 billion cans of Monster Energy drink to consumers in 134 countries generating revenues of more than US$14 billion. MEC launched the original Monster Energy drink in Australia in July 2009 through its wholly-owned subsidiary MEAU. The packaging of the original drink had a black background with the M-icon and the word “Energy” coloured green. Also from 2009, MEC, through MEAU, launched variants of the Monster Energy drink which were sold in Australia prior to January 2015. All of the variants featured prominently the M-icon and the stylised depiction of the word Monster. On many of the variants, the word “Energy” was supplemented (or occasionally replaced) by the specific variant name such as “Monster Ripper Energy + Juice” and “Monster Energy BFC”, and the variants used different colours on the packaging. By way of illustration, those examples are depicted below:
Monster Energy Original
(sold in Australia since 2009)
Monster Ripper
(sold in Australia between 2009 and 2013)
Monster Energy “BFC”
(sold in Australia between 2009 and 2013)
The admissibility of website pages under the business records exception has been considered in a number of cases.
In Roach v Page (No 27) [2003] NSWSC 1046, Sperling J ruled inadmissible extracts from the websites of two businesses which described the quality control procedures undertaken by each business. His Honour referred to his earlier ruling in Roach v Page (No 15) [2003] NSWSC 939 in which his Honour had observed that not every publication by a business is a “record of the business” within the meaning of s 69. In the earlier ruling (at [5] and [6]), his Honour concluded that:
The records of the business are the documents (or other means of holding information) by which activities of the business are recorded. Business activities so recorded would typically include business operations so recorded, internal communications and communications between the business and third parties.
On the other hand, where it is a function of a business to publish books, newspapers, magazines, journals (including specialised professional, trade or industry journals), such publications are not records of the business. They are the products of the business, not a record of its business activities. Similarly, publications kept by a business such as journals or manuals (say, for reference purposes) are not records of the business.
In Roach v Page (No 27), Sperling J concluded that a flyer, media advertisement or a website publication, extolling the virtues of the business, is not a record of a business within the meaning of s 69.
The reasoning of Sperling J in Roach v Page (No 15) and Roach v Page (No 27) has been cited on many occasions, including in Hansen Beverage Company v Bickfords (Australia) Pty Ltd (2008) 75 IPR 505 at [133] per Middleton J; National Telecoms Group Ltd v John Fairfax Publications Pty Ltd (No 1) [2011] NSWSC 455 at [70]-[71] per Davies J; McMahon v John Fairfax Publications Pty Ltd (No 4) [2012] NSWSC 216 at [22]-[26] per McCallum J; and ACCC v Air New Zealand Limited (No 5) (2012) 301 ALR 352 per Perram J (ACCC v Air New Zealand Limited (No 5)).
Sperling J’s rulings were, of course, directed to the specific types of documents in issue before him. In Southern Cross Airports v Chief Commissioner of State Revenue [2011] NSWSC 349, Gzell J cautioned against applying Sperling J’s reasoning as a rule of law in place of the statutory test, stating (at [41]-[44]):
I do not understand Sperling J to have spoken categorically about what constituted a business record. In addition to the documents by which activities of a business are recorded I would include as business records documents relevant to the conduct of the business.
The introductory words of s 69(1)(a)(i) of the Evidence Act that the provision applies to a document that is, or forms part of, the records belonging to or kept in the course of, or for the purposes of a business, encompasses more than documents recording the activities of a business.
For example, a valuation of the assets of a business for insurance purposes or for the purpose of determining appropriate depreciation rates does not record the activities of a business but it is kept in the course of, or for the purposes of, the business.
It is preferable, in my view, not to seek to define a business record but to be guided to a decision whether or not a document is a business record by the terms of the statutory provision itself.
Similarly, in Charan v Nationwide News Pty Ltd [2018] VSC 3, Forrest J observed (at [463]):
…the distinction between “product” and “records” is problematic. It does not appear in the text of s 69(1). The language used in the provision is broad and appears to encompass any documents kept by a person, body or organisation “in the course of, or for the purposes of” a business. To exclude documents that are part of the records of an organisation, however generated and for whatever purpose under this provision (as opposed to a subsequent discretionary exclusion under s 135) involves, I think, an artificial distinction not covered by the wording of the section.
As recognised by Perram J in both ACCC v Air New Zealand Limited (No 5) and Voxson Pty Ltd v Telstra Corporation Limited (No. 10) (2018) 134 IPR 99 at [37] (Voxson), there is no invariable rule that pages of a website are not business records within the meaning of s 69. Ultimately, whether the results of an internet search can be shown to be a business record within the meaning of s 69 depends upon the content of the webpage and what is able to be established (whether directly or by inference) about the content of the page. Business records include invoices (as per Asden Developments Pty Ltd (in liq) v Dinoris (No 2) (2015) 235 FCR 382 at [11]-[16] per Reeves J) and contractual terms and conditions and customer communications (as per Dowling v Commonwealth Bank of Australia [2008] FCA 59 at [13], [15] per Reeves J).
In my view, documents by which a business offers a product for sale, which typically includes a description of the product and the price and possibly other terms and conditions of the offer, would constitute business records within the meaning of s 69. That would be so whether the documents are made available to potential customers via the company’s website or in the company’s retail store. However, documents which are merely promotional or descriptive of the activities of a company, such as might be found on an “About Us” link on a website, are unlikely to constitute business records, consistently with the conclusions reached in Roach v Page (No 27) and ACCC v Air New Zealand (No 5).
Historic webpages generated through the use of the “Wayback Machine” have been ruled inadmissible in a number of cases: see for example E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2008) 77 IPR 69 at [126] per Flick J; Shape Shopfitters Pty Ltd v Shape Australia Pty Ltd (No 2) [2017] FCA 474 at [23] per Mortimer J; and Voxson at [36]-[37] per Perram J. As observed by Perram J in Voxson, the Wayback Machine website conveys an implicit representation that the website has copied third party webpages into its archive and recorded the date on which it did so and that the webpage which appears in its archive is the webpage which existed on that date. As such, documents produced using the Wayback Machine are necessarily hearsay (indeed, second hand hearsay in the sense that the archived webpage is itself hearsay). In each of the cases referred to above, the business records exception in s 69 was not satisfied as there was no admissible evidence to establish that the archived webpages formed part of the records of the business conducted by the Wayback Machine or that the webpages were created by someone who might be expected to have had personal knowledge of the facts which had been recorded.
Turning to the evidence in dispute, it is unnecessary to consider in detail the first category of evidence because I have ruled that it is irrelevant. I observe, though, that if the webpages were relevant, I would have admitted the evidence in so far as it consisted of webpages offering products for sale and where the existence and identity of the business conducting the website was proved.
The second category of evidence comprised archived webpages generated by the use of the Wayback Machine. No evidence has been adduced concerning the business of the Wayback Machine. In the absence of such evidence, and consistently with the decisions referred to earlier, I am not satisfied that the archived webpages are business records. I therefore rule them inadmissible.
The third category of evidence consists of historical “posts” on Facebook and Instagram accounts maintained by a business. This category raises difficult questions. It is necessary to consider each of the three elements of the definition of business records.
The first element is whether the Facebook and Instagram posts sought to be adduced in evidence are or form part of the records belonging to or kept by an entity in the course of, or for the purposes of a business, or at any time were or formed part of such a record. In a business context, the posts are communications by the business concerned to persons who follow the Facebook or Instagram account of the business. I infer that such followers would be past or potential future customers of the business. Taking the Sin City Rims Facebook posts as an example (described above), the posts are not a direct record of a business activity; drawing necessary inferences in favour of MEC, the posts are a form of promotion, publicising the sale of “Monster Energy” wheels. While email communications of a business have been found to be business records (see ACCC v Air New Zealand Limited (No 1) (2012) 207 FCR 448 at [58] per Perram J and the cases there cited), the Sin City Rims Facebook posts are of a different nature in that they are not communications to specific persons but are published more broadly to “followers”. Nevertheless, applying the statutory language, it seems to me that the Sin City Rims Facebook posts are documents that form part of the records belonging to or kept by Sin City Rims in the course of or for the purposes of its business. The posts are a record of the communications made by the business to its followers, and are analogous to emails that might be sent to a customer distribution list.
The second element is whether the Facebook and Instagram posts contain a previous representation made or recorded in the document in the course of, or for the purposes of, the business. For the reasons already given, I am prepared to find that this second element is also satisfied. I infer that the posts are communications by the business concerned directed to potential customers of the business. However, a more difficult question is to determine what is being communicated by the post, which is relevant to the third element of the definition of business records. MEC asks me to infer that the pictures posted to the Facebook or Instagram accounts display vehicles with wheels bearing an MEC mark sold by Sin City Rims prior to the date of the posts. Certainly that inference is open. But without further evidence, other inferences are also open. It may be that the pictures uploaded to the Facebook and Instagram accounts are pictures taken by “followers” of the businesses concerned, showing products of general interest to the business and other followers, but which were not purchased from the business concerned.
The third element is whether the previous representation in the document was made by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact, or was made on the basis of information directly or indirectly supplied by such a person. There are a number of difficulties in satisfying this element in the present case. The first difficulty is identifying what the representation is. The second difficulty, associated with the first, is identifying the source of, and the background to, the photos and information in the posts. As noted above, I infer from the posts that the photos of vehicles that are depicted originated from a third person (Jarred and Jase respectively). That fact does not exclude the application of s 69 (Vitali v Stachnik [2001] NSWSC 303 at [8] per Barrett J). However, given the nature of the Facebook and Instagram posts, there is no basis for the Court to make any clear finding as to what is represented by the post and whether the representation was made by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact, or was made on the basis of information directly or indirectly supplied by such a person.
Accordingly, I am not satisfied that the Facebook and Instagram posts are business records and I rule them inadmissible.
The fourth category of evidence comprises product catalogues which contained descriptions of various motorcycle related products apparently being offered for sale, some of which bore an MEC mark. In my view, such documents are capable of constituting business records. However, the documents were retrieved from a website called Issuu and there is no evidence concerning that website or any business conducted by it. There is no evidentiary basis to find that the catalogues are business records of Issuu. Nor is there any evidence as to the identity or operation of the businesses that published the catalogues, nor is there any evidence as to whether, where, when and how any such catalogues were made available to members of the public in Australia. For that reason, I am not satisfied that the catalogues are business records and I rule them inadmissible.
General discretion to exclude evidence
RJR also submitted that each of the categories of website evidence ought to be excluded under s 135 of the Evidence Act. RJR submitted that the probative value of the evidence was slight for the reason that there was no evidence as to the nature of the businesses that operated the websites, how many customers they might have, or how many people visited their website in a given period. RJR also submitted that admitting the evidence would be unfairly prejudicial to it because it has no opportunity to test the evidence.
I accept the submission that the probative value of the contested evidence is slight. At its highest, it presents a snapshot of instances in which automotive wheels or motorcycle related products have been offered for sale and possibly sold in Australia bearing an MEC mark. There is no basis on which to assess the scale of any such offers or sales. For that reason, the evidence has very little probative value to an assessment of the reputation of the MEC marks in Australia.
On the other hand, I am not generally persuaded that the admission of the evidence might be unfairly prejudicial to RJR. This is a civil proceeding where the onus rests on MEC. The evidence will be given such weight as it deserves, recognising its shortcomings. Further, it is not entirely the case that RJR could not test the evidence. The evidence was adduced to prove that particular businesses had offered for sale and possibly sold various products in Australia bearing an MEC mark. If it chose, RJR could have subpoenaed the various businesses referred to in the evidence to obtain records of any sales of products bearing an MEC mark. Understandably, RJR has chosen not to do that. But I do not consider that RJR was unable to test the evidence. As such, if the evidence had otherwise been admissible, I would not have exercised the discretion to exclude it under s 135.
4.2 Affidavit of Ben Keith Fraser
MEC objected to the whole of the affidavit of Ben Keith Fraser sworn 21 November 2018, other than paragraphs 1 and 50 to 57, on the grounds of relevance and hearsay. Alternatively, MEC asked me to exclude the evidence under s 135. RJR did not read paragraph 73. On 15 April 2019, I ruled inadmissible the following paragraphs and the exhibits thereto: 4-7, 9-13, 15, 22, 23, 25, 26, 28, 30, 32, 33, 35, 38, 39, 42, 44, 46, 48, 58-67, 69 and 71-76. These are my reasons for that ruling.
Mr Fraser gave evidence of internet searches he conducted on 23 October 2018 and exhibited screenshots of the results of his searches to his affidavit. Mr Fraser visited the homepage of IP Australia, clicked the “Search trade marks” link and typed the word “Monster” into the search function, producing 816 results. He then filtered the results to “trade mark words” and “registered” status, which reduced the number of results to 246, and exhibited the list of results. Mr Fraser then clicked on the links to several of the listed trade marks, and exhibited a printout of the trade mark details from IP Australia. The details included a depiction of the trade mark, the priority date and the registration date and the goods or services in respect of which the mark was registered.
In addition, in respect of some of the listed trade marks, Mr Fraser conducted internet searches of the name of the owner of the mark and/or the mark using Google. By way of illustration, Mr Fraser conducted a search of “Monster Cable”, locating a website purportedly the Australian website for Monster Cable which described the entity as the largest headphone manufacturer in the world. Mr Fraser then clicked on the “Our Story” tab and exhibited a screenshot of the results, including a page that promoted its collaboration with several brands including the automobile brand Lamborghini. Mr Fraser exhibited screenshots of several other pages of the website that contained promotional descriptions of the business under the “About Monster” link. Mr Fraser repeated this exercise in respect of several other “Monster” marks. In respect of some of the websites visited, Mr Fraser exhibited screenshots of products offered for sale by the business via the website. However, none of the webpages, and therefore none of the offers, were dated before the priority date.
RJR submitted that the evidence was adduced to prove the extent to which the word “Monster” had been used by traders in Australia as a trade mark before the priority date. It was submitted that such evidence was relevant to the nature and extent of MEC’s reputation in the word “Monster” in the marketplace. To illustrate, it was said that if the evidence showed that there had been extensive use of the word “Monster” as a mark in respect of alloy wheels, and if MEC had not used its marks in that product category, it would be open to the Court to conclude that a notional consumer would not associate the use of the word in that category with MEC. RJR acknowledged that the evidence obtained from the IP Australia website, showing registration of marks, did not directly prove use or extent of use of the marks. However, it submitted that many of the marks were registered before the priority date, in some cases 20 or 30 years earlier, and the Court could draw an inference that at least some of the marks had been used before the priority date. RJR also submitted that the evidence demonstrated that a large number of traders had adopted the name “Monster” with the intention of using the name as a trade mark. RJR also acknowledged that none of the website pages of the businesses that used the “Monster” marks predated the priority date. However, it submitted that the Court could infer that the marks had been used before the priority date because the registration of the marks had been in place well before the priority date.
The evidence can be divided into two categories. The first category is the result of searches conducted on the IP Australia website of the trade mark registrations. The objection is that the evidence is irrelevant because registration does not prove use or extent of use before the priority date. I will allow the evidence. I accept that its probative value is limited. Nevertheless, I infer that many of the traders who have registered a “Monster” mark have used the mark at least to some extent, and it follows that there are a significant number of traders who have adopted the “Monster” mark. Although I have not excluded the evidence on the ground of relevance, the evidence has not been material to my overall conclusions in this case.
The second category of evidence is the result of Google searches of the name of the owner of the mark and/or the mark. The objection is that the evidence is irrelevant (because it shows use of the marks after the priority date) and is hearsay. I uphold those objections and will not admit that evidence. First, many of the webpages are promotional and descriptive of the businesses (downloaded from the ‘About Us’ sections of websites). For the reasons explained earlier, such material is inadmissible hearsay. Second, in so far as the webpages are in the nature of offers for products, those offers show use of the marks after the priority date and I cannot infer from the evidence that the relevant company used the marks in a similar manner before the priority date. The evidence is irrelevant for that reason. That evidence is contained in the paragraphs of the affidavit I have ruled inadmissible, and the exhibits thereto.
4.3 Affidavit of Zsuzsanna Zalatnai
MEC objected to paragraphs 6 and 7 of the Affidavit of Zsuzsanna Zalatnai sworn 20 November 2018 and exhibit ZZ-3 on the ground of hearsay. On 15 April 2019, I ruled that evidence to be admissible. These are my reasons for that ruling.
Ms Zalatnai is the National Marketing Manager for Bob Jane T-Marts. Ms Zalatnai gave evidence that she had collated from Bob Jane T-Marts’ computer system data concerning the number of visitors to the Bob Jane website and to pages of that website which featured “Monster” wheels. That data was recorded in exhibit ZZ-3. In further oral evidence in chief, Ms Zalatnai stated that exhibit ZZ-3 was a document printed out from Google Analytics, which was used by Bob Jane T-Marts for measuring traffic to the Bob Jane website. Ms Zalatnai stated that Bob Jane T-Marts had a Google Analytics account which gave access to the information presented in the document. She also stated that Bob Jane T-Marts used the data obtained from Google Analytics to make marketing decisions as to what would be displayed on the Bob Jane website. Bob Jane T-Marts used the data for ongoing marketing campaigns.
Exhibit ZZ-3 is hearsay. It is evidence of previous representations (data relating to visits to the Bob Jane website) adduced to prove the facts asserted by the representations. MEC submitted that the document did not come within the business records exception in s 69 of the Evidence Act, in part because it had been prepared in contemplation of litigation within the meaning of s 69(3).
Data obtained from Google Analytics by businesses operating websites has been admitted into evidence in a number of cases: Sports Warehouse Inc v Fry Consulting Pty Ltd (2010) 186 FCR 519 at [56]-[57]; Vendor Advocacy Australia Pty Ltd v Seitanidis (2013) 103 IPR 1 at [115]; Pedavoli v Fairfax Media Publications Pty Ltd (2014) 324 ALR 166 at [133]-[134] (Pedavoli); Brooks v Fairfax Media Publications Pty Ltd [2015] NSWSC 986 at [7]; Metro Business Centre Pty Ltd v Centrefold Entertainment Pty Ltd (2017) 127 IPR 1 at [57]-[60], [66]-[68], and [111]; and Pham Global at [62] and [77]. However, in most of those cases, there was no challenge to admissibility.
In Pedavoli, an objection was taken to the admissibility of a document recording Google Analytics data. McCallum J concluded that the document was admissible as a business record of the entity that operated the website. Her Honour concluded that the document formed part of the records belonging to the entity for the purposes of its business. Her Honour also found that the document was produced by a computer (using Google Analytics). In accordance with s 146 of the Evidence Act, her Honour considered that it was reasonably open to find that the process used is one that, if properly used, produces the outcome of identifying the number of website page views on the dates in question.
With respect, I agree with the conclusions expressed by McCallum J. Although no direct evidence was adduced in relation to the Google Analytics service, I infer from the evidence of Ms Zalatnai and exhibit ZZ-3 that Google Analytics is a service supplied by Google to individual businesses which tracks and records traffic to the business’ website. Ms Zalatnai gave evidence that Bob Jane T-Marts has an account with Google Analytics and is able to retrieve such data through the account. Ms Zalatnai also gave evidence that Bob Jane T-Marts uses the data in the course of and for the purposes of the business at Bob Jane T-Marts.
I am satisfied that exhibit ZZ-3 satisfies the requirements of the business records exception. Although the data is apparently stored by Google Analytics, and only comes into the possession of Bob Jane T-Marts when it is accessed through the Bob Jane T-Marts account, it is data kept by Google Analytics for Bob Jane T-Marts and is accessible by Bob Jane T-Marts whenever it chooses to access it. The data therefore forms part of the records belonging to Bob Jane T-Marts in the course of and for the purposes of its business. The document contains a previous representation made or recorded in the course of and for the purposes of the business of Bob Jane T-Marts and, given the nature of the Google Analytics service, I infer that the relevant representations in the document were made on the basis of information indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the underlying facts.
In my view, s 69(3) is not applicable to exhibit ZZ-3. I infer from the evidence of Ms Zalatnai and exhibit ZZ-3 that Bob Jane T-Marts’ account with Google Analytics pre-dated this proceeding. The underlying data was recorded and stored by Google Analytics for Bob Jane T-Marts in an ongoing capacity and the underlying data (which is the relevant representation in the document) was not prepared or obtained for the purpose of conducting, or for or in contemplation of or in connection with, a proceeding.
Accordingly, in my view paragraphs 6 and 7 of, and exhibit ZZ-3 to, the Affidavit of Ms Zalatnai are admissible.
5. CONCLUSION AND ORDERS
In conclusion, I uphold RJR’s appeal against the decision of the delegate of the Registrar of Trade Marks, and I reject each of the grounds of opposition raised by MEC. The orders I will make are to allow the appeal, set aside the decision of the delegate and to order that RJR’s trade mark applications proceed to be registered. I will also order that MEC pays RJR’s costs of this proceeding and the proceeding before the Registrar of Trade Marks.
I certify that the preceding two hundred and six (206) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice O'Bryan. Associate:
Dated: 21 June 2019
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