Scaip S.R.L. v Worldwide Machinery Ltd

[2019] ATMO 57

TRADE MARKS ACT 1995

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

Re:Opposition by SCAIP S.R.L. to registration of trade mark applications 1592355 and 1592358 (7, 12, 37) - SUPERIOR MANUFACTURING WITH DEVICE - in the name of Worldwide Machinery Ltd.

Delegate:	Katrina Brown
Representation:	Opponent: Not represented at hearing Applicant: Joanna Lawrence of counsel, Ashurst Australia
Decision:	2019 ATMO 57 Trade Marks Act 1995 – s 52 opposition – ss 42(b), 44, 60, 58 and 62A considered – no grounds established – trade marks to proceed to registration.

Background

1. This decision is in respect of oppositions under section 52 of the Trade Marks Act 1995 (‘the Act’) by SCAIP S.R.L. (‘the Opponent’) to registration of the following trade marks (‘the Trade Marks’):

Trade Mark No	1592355	1592358
Trade Mark
Applicant	Worldwide Machinery Ltd (‘the Applicant’)
Filing Date	20 November 2013
Convention Priority Date	18 November 2013
Specification	Class 7: Construction and pipeline specialty equipment, including, pipe layers, hydraulic kits and conversion packages, padding machines, vacuum lifts, pipe bending machines, pipe carriers, pipe facing machines, pipeline accessories in this class, including bending sets, mandrels and line-up clamps Class 12: Motor vehicles, including, tractors and trucks Class 37: Conversion services for pipeline specialty equipment; rental services for construction and pipeline specialty equipment; construction and pipeline speciality equipment refurbishment services (‘the Applicant’s Goods and Services’)
Endorsement	Provisions of subsection s 44(4) and/or Reg 4.15A(5) applied.

1. In respect of trade mark number 1592355 the convention priority date applies to the following goods and services:

   Class 7: Construction and pipeline specialty equipment, namely, pipe layers, hydraulic kits and conversion packages, padding machines, vacuum lifts, pipe bending machines, pipe carriers, pipe facing machines, pipeline accessories

   Class 12: Tractors; trucks

   Class 37: Conversion services for pipeline specialty equipment; rental services for construction and pipeline specialty equipment

2. In respect of trade mark number 1592358 the convention priority date applies to the class 7 and class 12 goods set out at [2] of this decision. The convention priority date is not claimed in respect of the class 37 services. 

3. The Trade Marks were examined as required under s 31 of the Act. Acceptance of the Trade Marks was advertised in the Official Journal of Trade Marks on 10 November 2016.

4. For each of the Trade Marks, the Opponent filed a Notice of Intention to Oppose on 10 January 2017, followed by a Statement of Grounds and Particulars (‘SGP’) on 10 February 2017.

5. The Applicant filed a Notice of Intention to Defend the Trade Marks on 22 March 2017.

6. In due course the parties filed evidence in support of the oppositions and evidence in answer. The Opponent did not file evidence in reply.  

7. The matter came before me, a delegate of the Registrar of Trade Marks, in Canberra on 17 September 2018. The Applicant was represented by Joanna Lawrence of Counsel. The Opponent was not represented at the hearing and written submissions were not filed on its behalf.

   Grounds of opposition and onus

8. In each SGP the Opponent nominated grounds of opposition under ss 42, 44, 58, 60 and 62A.

9. The Opponent bears the onus of establishing at least one of the grounds of opposition.[1] The standard of proof is the ordinary civil standard of the balance of probabilities.[2]

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

   [2] Telstra Corporation Ltd v Phone Directories Co Pty Ltd [2015] FCAFC 156 [132].

   Evidence

10. The parties rely on the following declarations:

    Evidence in support

    ·     Declaration of Carole Raabe (Spruson & Ferguson) made on 29 June 2017 with Exhibit CR-1 (‘Raabe 1’).

    o   Exhibit CR-1 is a declaration of Carole Raabe made on 24 December 2014 with Exhibits 1 to 7 (‘Raabe 2’).

    I note that there is no statement made directly from an officer of the Opponent. The Opponent’s evidence consists of declarations made by its legal representative, who makes her declaration on the facts provided to her from the records of the Opponent or from other publicly available information.

    Evidence in answer

    ·     Declaration of David Sinclair (President of Applicant) made on 3 October 2017 with Annexures DS-1 to DS-2 (‘Sinclair 1’).

    o   DS-1 is a declaration of David Sinclair made on 18 September 2014 with Annexures DS-1 to DS-18 (‘Sinclair 2’).

    o   DS-2 is a declaration of David Sinclair made on 31 March 2015 with Annexures DS-20 to DS-22 (‘Sinclair 3’).

    ·     Declaration of Joanna Lawrence (Ashurst Australia) made on 4 October 2017 with Annexures JML-1 to JML-8 (‘Lawrence 1’).

    o   Annexure JML-1 is a declaration of German Flores (Art and Marketing Director of the Applicant) made on 15 September 2014 with Annexures GF-1 to GF-4 (‘Flores 1’).

    o   Annexure JML-2 is a declaration of Mel Whyte (CEO and Managing Director of Wasco (Australia) Pty Ltd) made on 18 September 2014 with Annexure MW-1 (‘Whyte Declaration’).

    o   Annexure JML-3 is a declaration of Bob Gavranich (Executive General Manager of PIHA Pty Ltd) made on 19 September 2014 (‘Gavranich Declaration’).

    o   Annexure JML-4 is a declaration of Steve Dobbie (Business Manager of the Australian Pipeline Industry Association Ltd) made on 19 September 2014 (‘Dobbie Declaration’).

    o   Annexure JML-5 is a declaration of Joanna Lawrence made on 19 September 2014 with Annexures JML-1 to JML-3 (‘Lawrence 2’).

    o   Annexure JML-6 is a declaration of Matthew Bennett (Plant and Equipment Manager of Monadelphous KT Pty Ltd) made on 19 September 2014 (‘Bennett Declaration’).

    o   Annexure JML-7 is a declaration of Mark Bumpstead (President of NACAP Australia Pty Ltd) made on 23 September 2014 (‘Bumpstead Declaration’).

    o   Annexure JML-8 is a declaration of German Flores made on 31 March 2015 with Annexures GF-5 to GF-9 (‘Flores 2’).

    The Applicant

11. The Applicant is described in Sinclair 2 as follows:

    Worldwide [Applicant] was established in 1950 in the United States of America. Worldwide is an international company specialising in the sale and rental of heavy construction machinery and equipment around the world.

    The Worldwide Group has seven different divisions focused on different elements of its construction machinery business, with two of those divisions focused on the pipeline industry. The SUPERIOR Manufacturing division manufactures a wide range of construction and pipeline machinery and equipment to customers around the world. The Worldwide Machinery Pipeline division sells, rents, distributes, and services the SUPERIOR MANUFACTURING products on a global scale.

    The Opponent

12. Raabe 2 provides the following information about the Opponent:

    The [Opponent] commenced operating between 1958 and 1960 in Parma, Italy when Franco Grassi opened a small mechanical workshop mainly involved in repairing and overhauling of farming tracked tractors, dozers, loaders and tracked machinery…

    A few years later, the company started a business relationship with Sapiem, an Italian oil and gas industry company. As a consequence of that relationship, the [Opponent] started offering repair and overhaul services for different types of tractors, special machinery and equipment exclusively used in pipeline projects.

    Today, the [Opponent] manufactures machinery and equipment for the pipeline industry, including pipe layers, pipe-carriers, flat bed tractors and padding machines. These goods are distributed around the world, including Australia.

    Prior opposition between the parties

13. The Applicant and Opponent were also parties to an opposition proceeding relating to the following trade mark (‘the Opponent’s Registered Trade Mark’):

Trade Mark No:	1600127
Trade Mark:
Owner:	SCAIP S.R.L
Filing Date:	23 May 2013
Priority Date:	29 November 2012
Specification:	Class 12: Vehicles; apparatus for locomotion by land, self-propelled land vehicles equipped with special machinery for creating oil pipelines, gas and water conduits; land vehicles comprising self-propelled equipment for placing pipes; self-propelled vehicles with screening equipment and sifting bucket; self-propelled crawler land vehicles with a loading platform; self-propelled crawler land vehicles equipped with vacuum lifters, suction cups for lifters, couplers, crimping machines, hydraulic chucks, self-propelled pipe bending machines

1. In this prior proceeding, SCAIP S.R.L was the Applicant (it is the Opponent in the current matter) and Worldwide Machinery Ltd was the Opponent (it is the Applicant in the current matter). 

2. The decision in this prior proceeding was issued on 31 March 2016. The delegate found that none of the grounds of opposition had been established.

3. The evidence filed by both parties in the prior proceeding is the same material relied upon in the current matter with the addition of Raabe 1 and Sinclair 1.

   Relationship between the parties

4. In Sinclair 2 the relationship between the parties is summarised as follows:

   SCAIP owns and operates the manufacturing facility in Parma, Italy, which manufactures the majority of the Worldwide SUPERIOR MANUFACTURING products sold in Australia according to Worldwide’s specifications and pursuant to training and direction by Worldwide’s Australian representatives. The remainder of the SUPERIOR MANUFACTURING products sold in Australia under the Opposed Trade Marks are manufactured at Worldwide’s Houston facility.

5. Ms Raabe, the Opponent’s representative, declares that the first exclusive distribution agreement between the parties was signed in 1997. This distribution agreement has not been entered into evidence. Distribution agreements dated 2007 (‘the 2007 Agreement’) and 2013 (‘the 2013 Agreement’) have been entered into evidence. Both of these agreements are claimed to be confidential. However, it is necessary that I discuss some of the provisions of these agreements to the degree necessary to provide sensible reasons for my decision. In order to preserve, as far as possible, the confidentiality of the agreements I will discuss them in broad terms and I will avoid what could arguably be commercially sensitive matters.

6. In the prior opposition between the parties the delegate described the relevant provisions of the 2007 agreement and the 2013 agreement. I accept and adopt the delegate’s summary which was as follows (noting that I have updated the references to the parties (that is, Applicant and Opponent) so that they correctly apply to the current matters):

   The 2007 agreement acknowledges that the [Opponent] has had significant experience in the pipeline construction industry and created its own line of pipeline construction equipment, and the [Applicant], through its sales and trading activities, has developed contacts and relationships in that specialised market. The agreement also acknowledges that the [Applicant] assisted in developing and refining the [Opponent’s] products. Under the 2007 agreement the [Opponent] granted to the [Applicant] the exclusive right to sell certain pipeline related products, subject to certain delineations of territory and customer-type. Included within that grant was the exclusive right of the [Applicant] to sell those pipeline-related products in Australia to pipeline contractors.

   In respect of intellectual property the 2007 agreement noted that all patent applications have and shall be made jointly and equally between the parties, and that the [Applicant] would cooperate with the [Opponent] to protect any trade marks of the [Opponent] (although there is no definition or indication as to what those trade marks may be). Upon expiry of the agreement the [Applicant] was to transfer or assign to the [Opponent] any right, title or interest in any of the [Opponent’s] trade marks that the [Applicant] may have acquired in distributing the products.

   The 2013 agreement[3] specified that it superseded and replaced any previous agreements, and it was still in force as at the date of Mr Sinclair’s declaration provided in evidence in reply. It too acknowledged the [Opponent] as an experienced producer of pipeline equipment and the [Applicant] as having ‘commercialized’ the [Opponent’s] products and having contributed to key design and manufacturing elements. Its introductory statements summarise the purpose of the agreement as ‘the Parties hereby commit to try to increase sales volumes of the products manufactured by [the Applicant], through strong commercial investments and by means of a careful planning of the production activity’. It provided that the [Opponent] (referred to as the ‘Supplier’) appointed the [Applicant] (referred to as the ‘Distributor’) as its exclusive distributor, subject to territorial delineations and with the exclusion of certain customers.

   As with the 2007 agreement, included within the terms of the 2013 agreement was the exclusive right of the [Applicant] to sell the pipeline related products in Australia. I note also that the [Applicant] was subject to a non-competition obligation specifying that it would not manufacture or sell any new pipeline related products in competition with those covered by the 2013 agreement (unless the [Opponent] was unable to supply them). I note further that that the ‘Standard Warranty Conditions’ specified in the agreement identify the [Opponent] as the party liable for warranty.

   In respect of intellectual property the 2013 agreement only made provisions in relation to patents… It is silent in respect of trade marks.[4]

   [3] Incorporating subsequent amendments that were made to it in 2015.

   [4] Opposition by Worldwide Machinery Ltd v SCAIP S.R.L (unpublished) decided 31 March 2016 [22].

7. Sinclair 2 sets out the following manufacturing and distribution process in respect of orders from Australian customers for products bearing the Trade Marks between 2005 and September 2014:

   Worldwide’s customers provide their product specifications and/or service orders to Worldwide’s Australian representatives, who then coordinate the orders with Worldwide’s United States team. Worldwide representatives in the United States then relay the purchase orders to SCAIP, who manufactures the products accordingly and ships them to Worldwide’s primary Australian yard in Brisbane. The products are met by Worldwide Australian representatives and then delivered to the customers, with Worldwide handling all product training, maintenance, repairs, and warranty services with the customers.

   Creation of the Trade Marks

8. Sinclair 2 states that up until September 2002, the Applicant used the following logo:

9. Sinclair 2 goes on to explain that in 2001 the Applicant decided to adopt a new, more contemporary logo. Evan Greenberg (‘Greenberg’), the then Senior Vice President of the Applicant, asked German Flores (‘Flores’), the Applicant’s Art and Marketing Director at the time, to create a new logo.

10. In Flores 2, Flores confirms that Greenberg asked him in November 2001 to update the logo set out at [22] of this decision. Flores declares that he set about designing a suite of new logos from November 2001 to February 2002.  He declares that between August 2002 and October 2002 he created the following versions of the new logo:

11. The “round” version is the subject of trade mark application 1592358 and the “straight” version is the subject of trade mark application 1592355.

12. Flores explains the evolution of his ideas and the development of the individual elements that form the Trade Marks. Exhibit GF-2 to Flores 1 consists of extracts from his electronic work files showing the names and dates of files declared to pertain to the different versions of the logo.

13. Flores declares that the “round” version and the “straight” version are his own original design and that Greenberg signed off on the final design.

14. The Opponent’s attorney declares that she is informed that logo versions were created by Giordano Grassi (‘Grassi’) of the Opponent. Exhibit 5 to Raabe 2 is a copy of a facsimile dated 10 April 2002 from Grassi to Greenberg and Flores. The facsimile states that Grassi is sending his ideas about ‘logo “Superior”’. The subsequent pages of the facsimile show the following logos, some with handwritten annotations:

    1.    2.

    3..

    4.

    5.

15. The second logo is annotated with ‘can you try work about this??’ [sic]. The third logo is annotated with ‘good’ and the fifth with ‘very good’.

16. In response, Flores declares that Grassi did not have any input into the design of the new logos and that the logo in the facsimile accompanied by the note ‘can you try work about this??’ was never progressed beyond preliminary design work. Flores also adds that the other logos depicted in the facsimile were created by him and him alone. In support of this, Flores has provided copies of his electronic ‘Rejected Logos’ folder, the relevant files of which were last modified in January 2002. Flores reiterates that ‘at all relevant times he was responsible for the logo design process, and that [his] instructions in this regard were from Mr. Greenberg of the Worldwide Group’.

    Section 58

17. Section 58 of the Act provides that the registration of a trade mark may be opposed on the ground that an applicant is not the owner of the trade mark. The term ‘owner’ is not defined in the Act. However it is well established that in the absence of fraud, the owner of a trade mark is the person who first uses it in Australia, or first files a trade mark application for it in Australia, whichever is the earlier.

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

    The Opponent’s SUPERIOR MANUFACTURING logo [the Opponent’s Registered Trade Mark] is substantially identical to the Applicant’s mark [the Trade Mark], and has been used for the same and or similar goods as those specified in the opposed application. Thus the Applicant cannot claim to be the owner of the opposed mark [the Trade Mark].

19. As reflected in the particularisation, to establish this ground of opposition the Opponent needs to show that:

    ·     the Trade Marks and the Opponent’s Registered Trade Mark are identical or substantially identical; and

    ·     the Applicant’s Goods and Services are the ‘same kind of thing’ as the goods and services that the Opponent’s Registered Trade Mark has been used on or in relation to.

20. These requirements are relatively uncontroversial in these matters. The Opponent’s Registered Trade Mark is identical to trade mark number 1592358. I also consider the Opponent’s Registered Trade Mark to be substantially identical to trade mark number 1592355: the dominant cognitive cues[5] are the same, namely the words ‘Superior Manufacturing’ and a circular device bisected by a wavy line. The parties deal in the same goods being pipeline and construction equipment.

    [5] Accor Australia & New Zealand Hospitality Ltd v Liv Pty Ltd [2017] FCAFC 56.

21. Whilst these two requirements have been met, there is a third and crucial requirement that is not reflected in the Opponent’s particularisation of this ground. Section 58 essentially provides a means of prioritising competing claims to ownership. As such, it is not enough for the Opponent to have used its registered trade mark. The Opponent must establish that it has the earliest claim to ownership by showing that it filed for or used its registered trade mark in Australia prior to both the application to register the Trade Mark and any actual use of the Trade Mark in Australia by the Applicant.

22. As a means of setting the goalposts for the Opponent, I note that the earliest use of the Trade Marks in Australia demonstrated in the Applicant’s evidence is dated 2007 being an advertisement from the APIA Directory. This is further supported by sales figures for 2007 declared to be for products and services sold or rented by the Applicant under the ‘Superior Manufacturing trade mark’ in Australia. The Applicant has also provided the advertising expenditure for 2007 which is declared to be in connection with products and services sold by the Applicant under the ‘Superior Manufacturing brand’ in Australia.

1. The Applicant’s first demonstrated use in 2007 predates both the filing and priority date of the Opponent’s Registered Trade Mark. As such, to establish this ground the Opponent needs to demonstrate that it used its registered trade mark in Australia prior to 2007.

2. I note that in Raabe 2, the Opponent’s legal representative declares that she is informed that the ‘SUPERIOR trade mark’ was first used by the Opponent prior to 1997. I cannot be certain of what constitutes the ‘SUPERIOR trade mark’ because the term is not defined in the declaration. Furthermore, it is not clear that this use was in Australia.

3. The Opponent’s legal representative also declares that she is informed that the ‘SUPER MANUFACTORING logo trade mark’ has been used by the Opponent since 2002 for its pipeline specialty equipment division. It is unclear to me whether the ‘SUPER MANUFACTORING logo trade mark’ is a reference to the Opponent’s Registered Trade Mark, or some other logo which contains the words ‘Super Manufacturing’, noting that the latter would not be identical, or substantially identical, to the Trade Mark. Once again, this statement is silent as to whether the use took place in Australia. Additionally neither of these assertions as to use is corroborated. 

4. The only example of use provided by the Opponent is a declaration of conformity for a hydraulic wedge mandrel dated in 2003. However there is no indication as to how this declaration of conformity pertains to use in Australia.

5. The Opponent has not substantiated its assertions as to its use of the Opponent’s Registered Trade Mark in Australia, let alone any use prior to 2007. Furthermore, despite the ambiguity of the relationship between the parties, the Opponent has not put forward any submissions or evidence to the effect that the Applicant’s use should in fact be attributed to the Opponent, in the sense that where a manufacturer has applied its own trade mark to goods, when those goods enter the market use of the trade mark continues to be that of the manufacturer.[6]

   [6] Estex Clothing v Ellis and Goldstein (1996) 116 CLR 254, 271.

6. For its part the Applicant asserts that so far as Australia is concerned, the Opponent manufactured the goods in accordance with specifications provided by the Applicant, the Applicant supplied the Opponent with the ‘Superior Manufacturing’ trade mark and the Opponent applied it to the goods under the Applicant’s direction. In this respect I refer to James North Australia v Blundstone Pty Ltd[7] in which the distributor was held to be the real user of the trade mark. In particular I note the following observations:

   it has to be remembered that the goods were manufactured by the defendant [manufacturer] for the plaintiff [distributor] pursuant to a specific order which directed and required that, as distinct from the range of safety boots that the defendant was normally manufacturing, these safety boots be provided with a special trim and a particular mark; that the mark itself was supplied to the defendant by the plaintiff and stipulated by the plaintiff for use for the plaintiff’s trade; that the plaintiff was the exclusive outlet to the consumer, and that that was always contemplated and agreed between the parties.[8]  

   [7] (1978) 48 AOJP 2419.

   [8] Ibid 2424.

7. It is the Opponent who bears the onus of proof in this proceeding and weighing the evidence there is not enough to satisfy me that the Applicant is not the owner of the Trade Marks.

8. The s 58 ground of opposition is not established.

   Section 44

9. Section 44 of the Act relevantly provides:

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

   (a) the applicant’s trade mark is substantially identical with, or                   deceptively similar to:

   (i) a trade mark registered by another person in respect of   similar goods or closely related services; or
     (ii) a trade mark whose registration in respect of similar goods   or closely related services is being sought by another person;   and
     (b) the priority date for the registration of the applicant’s trade mark in                  respect of the applicant’s goods is not earlier than the priority date for   the registration of the other trade mark in respect of the similar goods              or closely related services.

   …

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

   (a) beginning before the priority date for the registration of the other   trade mark in respect of:
     (i) the similar goods or closely related services; or
     (ii) the similar services or closely related goods; and
     (b) ending on the priority date for the registration of the applicant’s   trade mark;

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

10. Subject to s 44(4), the Opponent must establish that the Trade Marks are substantially identical with, or deceptively similar to, another trade mark with an earlier priority date, in the name of a person other than the Applicant, in respect of similar goods or closely related services.

11. In support of this ground the Opponent relies on the Opponent’s Registered Trade Mark. From the information set out at [1] and [14] of this decision, it is evident that the Opponent’s Registered Trade Mark is held in a name other than that of the Applicant and its priority date is earlier than that of the Trade Marks.

12. The comparison of the trade marks and the goods are relatively straightforward. For the reasons I have already stated in regards to the s 58 ground of opposition, I consider the Opponent’s Registered Trade Mark and the Trade Marks to be substantially identical. In respect to the comparison of the goods, the Opponent’s Registered Trade Mark has a broad claim for vehicles in class 12 which encompasses the claims of the Trade Marks in that class for motor vehicles. Additionally, taking into account all of the surrounding circumstances particularly the high degree of similarity between the trade marks, I consider the claims of the Opponent’s Registered Trade Mark in class 12 for specific pipeline equipment to be goods of the same description as some of the specific pipeline equipment claimed by the Trade Marks in class 7. Accordingly, the requirements of s 44(1) have been made out.

13. Section 44(4) enables a trade mark to be registered, which would otherwise be rejected under s 44(1), on the basis of prior continuous use. During the course of examination, the Applicant provided evidence of its use of the Trade Marks and the applications were accepted under the provisions of s 44(4).

14. As discussed in relation to s 58, the evidence before me establishes that the Applicant first used the Trade Marks[9] in Australia in 2007. To support its continuous use of the Trade Marks, the Applicant has provided: examples of the Trade Marks being used in the course of trade in Australia in relation to the relevant goods over a variety of dates from 2007 onwards; annual sales figures relating to the ‘Superior Manufacturing trade mark’ in Australia from 2007 to 2013 (the priority date of the Trade Marks); annual advertising expenditure for ‘Superior Manufacturing brand’ in Australia from 2007 to 2013.

    [9] In discussing the evidence I have not distinguished between the use of trade mark number 1592355 and 1592358. This is because pursuant to s 7 of the Act I do not consider that the differences between the Trade Marks substantially affect their identity. That is, I consider use of trade mark 1592355 to be use of trade mark 1592358 (and vice versa) with additions or alterations that do not substantially affect its identity.

15. As a whole, the evidence supports the Applicant’s assertion that it has prior continuous use of the Trade Marks. I also note that the Opponent has not provided any submissions or evidence that questions the Applicant’s evidence of use.

16. The s 44 ground of opposition is not established.

    Section 60

17. Section 60 of the Act provides:

    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.

18. To establish this ground of opposition, the Opponent must demonstrate the existence of a reputation in another trade mark in Australia before the priority date of the Trade Marks. The Opponent must then establish that because of the aforesaid reputation use of the Trade Marks would be likely to deceive or cause confusion.

19. This ground of opposition is particularised in the SGPs as:

    The Opponent has used the trade mark SUPERIOR in Italy since at least 1997 in relation to the manufacture of machines for gas pipelines. Subsequently, use of the trade mark SUPERIOR has extended worldwide, including use in Australia.

    The Opponent has also used trade marks containing the words SUPERIOR MANUFACTURING (in word and logo form) since at least 2002 in relation to various machinery and equipment for the pipeline industry, including (but not limited to) pipe layers, pipe-carriers, flat bed tractors and padding machines. Use of trade marks containing the words SUPERIOR MANUFACTURING (in word and logo form) has extended around the world, including use in Australia.

    As a result of the Opponent’s continuous and extensive use of trade marks containing the words SUPERIOR and SUPERIOR MANUFACTURING (in word and logo form) around the world, including Australia, the Opponent has acquired a reputation in these marks, such that use of the Applicant’s mark is likely to deceive or cause confusion.  

20. The Opponent’s evidence adds very little to the information that is provided in the SGPs. For the purposes of s 60 the reputation cannot be assumed; it must be established as a matter of the fact.[10] The Opponent has not provided any sales figures, advertising or promotional expenditure, or examples of its use of SUPERIOR or SUPERIOR MANUFACTURING (in word or logo form) in Australia or overseas jurisdictions, all of which may have been of assistance in supporting the Opponent’s claims.    Nor has the Opponent put forward cogent evidence or submissions to the effect that any reputation gained from the Applicant’s use of the Trade Marks should vest with the Opponent.

    [10] ConAgra Inc v McCain Foods (Australia) Pty Ltd [1992] FCA 159 [77].

21. The material before me is not sufficient to establish the s 60 ground of opposition.

    Section 42

22. Section 42(b) of the Act relevantly provides:

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

    …

    (b) its use would be contrary to law.

23. The Opponent must satisfy the Registrar that use of the Trade Mark would not could be contrary to law.[11] As observed by Rangiah J in Primary Health Care Limited v Commonwealth of Australia:

    It is not enough for a party opposition registration to show that s 18 of the ACL or s 52 of the TPA [Trade Practices Act 1974] might be contravened. The opponent must prove, on the balance of probabilities, that the provision would be contravened by use of the trade mark.[12]

    [11] Advantage-Rent-A-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683 [28].

    [12] [2017] FCAFC 174 [411].

24. This ground of opposition is particularised in the SGP as follows:

    Given the Opponent’s continuous and extensive use of marks containing the words SUPERIOR or SUPERIOR MANUFACTURING (in word or logo form), use of the Applicant’s trade mark for goods claimed in the opposed application would constitute passing off and/or misleading and deceptive conduct in breach of the Australian Consumer Law, and or trade mark infringement.

    Further, the Opposed mark infringes the Opponent’s copyright in its marks containing the words SUPERIOR or SUPERIOR MANUFACTURING.

    Australian Consumer Law

25. The Opponent has not specified what sections of the Australian Consumer Law (‘ACL’) that it is relying upon. I take the use of the words ‘misleading and deceptive conduct’ in the SGP to mean that the Opponent relies upon s 18 of Schedule 2 to the ACL. Section 18 of the ACL concerns conduct or representations that have, or are likely to, mislead or deceive.

26. I have found that the Opponent has not demonstrated a reputation in its registered trade mark and that the Opponent has not established that any reputation gained from the Applicant’s use should vest with the Opponent. It follows that it is unlikely that use of the Trade Marks will amount to misleading or deceptive conduct under the ACL because ‘for the public to be misled or deceived…there must be in the minds of the relevant public some established truth against which the notion of misleading or deceptive conduct can be measured’.[13]

    [13] Dairy Vale Metro Co-op Ltd v Brownes Dairy Ltd [1981] FCA 63 [42].

27. The Opponent has not satisfied me that use of the Trade Mark would not could be contrary to the ACL.

    Passing Off

28. Where use of a trade mark does not contravene s 18 of the ACL neither will it amount to the tort of passing off.

29. The relationship between passing off and s 52 of the now repealed Trade Practices Act 1974 (‘TPA’) was addressed in Re Equity Access Pty Ltd v Westpac Banking Corporation:

    the scope for the operation of s 52 will thus be broader than that involved in the tort of passing off so that in a case such as the present where the claim is for the protection of the reputation in a name against the use of the name by another, failure to succeed under s 52 or s 53 will invariably mean that proceedings for passing off would likewise fail.[14]

    [14] [1989] FCA 506 [40].

30. Section 18 of the ACL is the equivalent of s 52 of the TPA.[15] The above comments are equally applicable to the relationship between s 18 of the ACL and the tort of passing off.

    [15] Primary Health Care Limited v Commonwealth of Australia [2017] FCAFC 174 [410].

31. As I have found that s 18 of the ACL has not been contravened, it follows that use of the Trade Mark does not amount to passing off.

    Trade mark infringement

32. The Opponent alleges that use of the Trade Marks by the Applicant would be contrary to law because it amounts to trade mark infringement. 

33. Under section 125 of the Act an action for infringement may be brought in a prescribed court[16] or any other court that has jurisdiction to hear the action. An opposition proceeding before the Registrar of Trade Marks is not a proceeding before a court and as such:

    it is unlikely that the Delegate has the jurisdiction to hear a section 120 action by virtue of s 42(b). In any event, the wording and effect of section 120 is similar to sections 44 and 60 of the Act. If it were appropriate for me to determine s 120 (and I am of the view that it is not), the issues have already been adequately covered by the other grounds of opposition.[17]

    Copyright

    [16] See s 190 for the list of prescribed courts.

    [17] Parkside Towbars Pty Ltd v Tow-Safe Pty Ltd [2011] ATMO 17 [38].

34. The Opponent’s assertion is that use of the Trade Marks by the Applicant contravenes the Copyright Act 1968 (‘CA’).

35. Copyright in an artistic work is infringed by a person who, not being the owner of the copyright, and without licence of the owner of the copyright, reproduces or authorises the reproduction of the artistic work.[18]

    [18] Copyright Act 1968 s 36.

36. The owner of the copyright is the author of the artistic work noting that s 35(6) of the CA relevantly provides:

    Where a literary, dramatic or artistic work…is made by the author in pursuance of the terms of his employment by another person under a contract of service or apprenticeship, that other person is the owner of the copyright subsisting in the work…

37. The evidence relating to the creation of the Trade Marks is set out at [22] to [28] of this decision. That information supports the view that the words and devices that form the Trade Marks and the Opponent’s Registered Trade Mark are Flores’ original artistic works which he authored between August and October 2002. At the time of authoring these artistic works, Flores was employed by the Applicant as its Art and Marketing Director and the directions he received in relation to creating the Trade Marks were from Greenberg, the then Senior Vice President of the Applicant. In my opinion, Flores authored the trade marks in pursuance of the terms of his employment with the Applicant and therefore the Applicant is the owner of any copyright subsisting in those artistic works.

38. The s 42(b) ground of opposition has not been established.

    Section 62A

39. Section 62A provides:

    The registration of a trade mark may be opposed on the ground that the application was made in bad faith.

40. The phrase ‘bad faith’ is not defined in the Act. However, in Fry Consulting Pty Ltd v Sports Warehouse (No 2) Dodds-Streeton J made the following observations:

    Bad faith, in the context of s 62A, does not, in my opinion, require, although it includes, dishonesty or fraud. It is a wider notion, potentially applicable to diverse species of conduct.

    The formulation in the United Kingdom authority of bad faith as falling short of the standard of acceptable commercial behaviour observed by reasonable and experienced persons in a particular area is, in my view, an apt touchstone…

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

    The question is whether, in all the particular circumstances, the applicant’s knowledge was such that his decision to apply for registration at the relevant date would be regarded as in bad faith by persons adopting proper standards.[19]

    [19] [2012] FCA 81 [164].

41. In DC Comics v Cheqout Pty Ltd, Bennett J endorsed the approach taken by Dodds-Streeton J, stating: 

    Bad faith is a combined test that involves subjective and objective elements. The subjective element refers to the knowledge of the relevant person at the time of making the application. The objective element requires the decision-maker to decide whether, in the light of that knowledge, the relevant person’s behaviour fell short of acceptable commercial standards.

    The question is whether the conduct falls short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in the particular area. It is whether the knowledge of the applicant was such that the decision to apply for registration would be regarded as in bad faith by persons adopting proper standards.[20]

    [20] [2013] FCA 478 [62].

42. This ground of opposition is particularised in the SGPs as:

    The Applicant was aware at the time of filing the Opposed Application of the Opponent’s prior rights in Australia and throughout the world in marks containing the words SUPERIOR or SUPERIOR MANUFACTURING (in word or logo form).

43. In Hard Coffee Pty Limited v Hard Coffee Main Beach Pty Limited, the Registrar’s delegate stated:

    The onus of demonstrating ‘bad faith’ falls squarely on the party making such an allegation with the need for evidence able to fulfil the degree of proof required to satisfy the civil standard of ‘balance of probabilities’. That said, the allegation of ‘bad faith’ is a very serious one and a finding of bad faith should not be taken lightly. [21]

    [21] [2009] ATMO 26 [12].

44. In this matter, the Opponent has not provided cogent evidence to support its assertions. The agreements between the parties are of little assistance to the Opponent. The third agreement, which was in place at the time that the Trade Mark applications were filed, is completely silent in relation to trade marks; it does not identify any trade marks, specifically or generally, nor does it make any reference to the ownership, assignment or licensing of trade marks. The second agreement made reference to ‘the trademarks of SCAIP’ but did not elaborate on what those trade marks might be. Nor has the Opponent provided any explanation of its understanding of what was meant by ‘the trademarks of SCAIP’. For the Applicant’s part I note the following statement in Sinclair  1:

    I confirm that the reference to “the trademarks of SCAIP” in the 2007 Distribution Agreement is understood by Worldwide as a reference to the “SCAIP” trade mark and logo and the trade marks of other manufacturers whose products SCAIP supplies to Worldwide.

1. I also note that the Trade Mark applications were filed before the other matter between the parties commenced. As such, at the time of filing the Trade Mark applications the Applicant was not aware of the outcome of the other matter. 

2. In summary, the Opponent has not satisfied me that the Trade Mark applications were made in bad faith, in the sense that in all the circumstances persons adopting proper standards would so regard the decision to apply to register the Trade Marks, or that reasonable and experienced persons in the field would view such conduct as falling short of acceptable commercial behaviour.

3. Accordingly, I find that the s 62A ground of opposition has not been established.

   Decision

4. Section 55(1) of the Act provides:

   (1)     Unless subsection (3) applies to the proceedings, the Registrar must,          at the end, decide:

   (a) to refuse to register the trade mark; or
     (b) to register the trade mark (with or without conditions or   limitations) in respect of the goods and/or services then   specified in the application;

   having regard to the extent (if any) to which the ground on which the                    application was opposed has been established.

5. The Opponent has not established a ground of opposition.

6. Accordingly Trade Marks 1592355 and 1592358 may proceed to registration one month from the date of this decision.

7. If the Registrar is served with a notice (or notices) of appeal before that time, I direct that registration shall not occur until the appeal(s) has/have been decided or discontinued and that the disposition of the application(s) should otherwise be in accordance with the Court’s order or direction.

   Costs

8. The Applicant sought costs. As the successful party, the Applicant is so entitled.

9. In respect of Trade Mark 1592355 I award costs against the Opponent as per Schedule 8 of the Trade Marks Regulations 1995.

10. In respect of Trade Mark 1592358 I award reduced costs against the Opponent in the same manner as indicated in Hume Industries (Malaysia) Berhard v James Hardie & Coy Pty Ltd.[22]

    [22] [2001] ATMO 78.

    Katrina Brown
    Hearing Officer
    Oppositions & Hearings
    Trade Marks & Designs
    10 April 2019