Seed Technology & Marketing Pty Ltd v Seedco Australia Pty Ltd

[2012] ATMO 82

TRADE MARKS ACT 1995

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

Re:Oppositions by Seed Technology & Marketing Pty Ltd to applications under section 92 of the Act by Seedco Australia Pty Ltd to remove trade mark numbers 755807(31) - SEEDCO and 812644(31) - SEEDCO Logo - in the name of Seed Technology & Marketing Pty Ltd

Delegate:

Iain Thompson

Representation:

Opponent: Louise Emmett, Trade Mark Attorney of Madderns Patent & Trade Mark Attorneys

Applicant: Written submissions by Lisa Jarrett, Senior Associate of Kelly & Co. Lawyers

Decision:

2012 ATMO 82

s92 proceedings, evidence of use during relevant period -: residual reputation and exercise of Registrar’s discretion under s 101(3).

Applications for removal unsuccessful

Background

1. These matters concern applications by Seedco Pty Ltd (‘the Removal Applicant’) under subsection 92(4)(b) of the Trade Marks Act 1995 (‘the Act’) for the removal from the register of trade marks of the trade marks (‘the Trade Marks’) specified hereunder:

Registration No:              755807

Priority Date:  24 February 1998

Goods:Class 31: Seeds and grains including legume and forage seeds, cereals, pulses and vegetable seeds

Trade Mark:  SEEDCO

Registration No:              812644

Priority Date:  5 November 1999

Goods:Class 31: Seeds and grains including legume and forage seeds, cereals, pulses and vegetable seeds

Trade Mark:  

1. The applications for removal are opposed by the owner of the trade marks, Seed Technology & Marketing Pty Ltd (‘the Removal Opponent’).

2. The Removal Opponent has served and filed evidence in support of its opposition.  The Removal Applicant has not served and filed evidence in answer.

3. The matters came before me to be heard as a delegate of the Registrar of Trade Marks in Adelaide on 28 August 2012.  The Removal Opponent was represented by Louise Emmett, Trade Mark Attorney of Madderns Patent & Trade Mark Attorneys.  The Removal Applicant did not appear and relied on written submissions by Lisa Jarrett, Senior Associate of Kelly & Co. Lawyers.

The Relevant Period

1. The Removal Applicant filed the applications on 25 February 2011 on the grounds set out in section 92(4)(b) of the Act, namely that there had been no use, or no use in good faith, of the trade mark in the three year period ending one month before the filing date. Accordingly, the relevant period for the purpose of section 92(4)(b) is the three year period ending on 25 January 2011 (the ‘Relevant Period’).

Onus

1. The onus in these proceedings is on the Removal Opponent to prove use of the Trade Marks during the Relevant Period as is mandated by subsection 100(1) of the Act which provides:

   100Burden on opponent to establish use of trade mark etc.

   (1)In any proceedings relating to an opposed application, it is for the opponent to rebut:

   […]

   (c)any allegation made under paragraph 92(4)(b) that the trade mark has not, at any time during the period of 3 years ending one month before the day on which the opposed application was filed, been used, or been used in good faith, by its registered owner in relation to the relevant goods and/or services.

   Note 1:If the registered owner of the trade mark has authorised another person to use it, any authorised use of the trade mark by that person is taken to be a use of the trade mark by the registered owner (see subsection 7(3)).

   Note 2:For file, month and registered owner see section 6.

The Evidence

1. The Removal Opponent has served and filed the following statutory declarations as evidence in support of its opposition:

   ·     Craig John Myall, General Manager of the Removal Opponent;

   ·     Louise Lynette Emmett, Trade Marks Attorney of Madderns Patent & Trade Mark Attorneys,

   ·     Matthew Lyle Redemski of Elders Gambier Farm Supplies; and

   ·     Bryan Andrew Robertson of Langseeds.

2. Mr Myall attests as follows:

   [The Removal Opponent’s] business purpose is the marketing and distribution of high value planting seed and grain to international and domestic markets. [The Removal Opponent’s] business activities include the instigation and management of seed grower production, quality control of seeds and grains produced, trading capabilities, commercial partnerships in research and development, and efficient supply chain management. [The Removal Opponent’s] annual turnover is approximately $25 million to $35 million. [The Removal Opponent] is the largest exporter of high-quality Australian pasture seeds, exporting to approximately 70 countries with the largest export markets being Europe, South America and Asia.

   [The Removal Opponent] is jointly owned by Seedco Limited (“SL”) and Elders Rural Services Australia Limited.

   SL was formed in 1964 as a farmer-owned cooperative with an initial membership of 35 seed growers and with a primary purpose of marketing the seed production of its grower members. [The Removal Opponent] was formed in January 2003 and took over the SL business at that time. [The Removal Opponent] has continued with the development and support of seed growers initiated by SL and there are now hundreds of grower shareholders who grow seed for and sell seed through [the Removal Opponent]. Earlier this month [the Removal Opponent]’s business was acquired by Heritage Seeds.

3. The Trade Marks were assigned from SL to the Removal Opponent in 2003.  Concerning the use of the Trade Marks during the Relevant Period, Mr Myall states:

   [The Removal Opponent] purchases seeds and grains from growers. [The Removal Opponent] then engages processing sheds to package the seeds and grains in bags (generally 25kg bags) for distribution to [the Removal Opponent’s] suppliers and [the Removal Opponent’s] suppliers then on-sell the seeds and grains to the end-user consumers (eg farmers, graziers, crop growers and pastoralists).

   SL commenced selling seeds and grains in bags marked with the SEEDCO trade mark in the 1960s. Attached to this Declaration and marked as “CJM4” is the cover page of a booklet titled “SEEDCO Seeds of Success — A Twenty Five Year History” printed in 1988. I note the cover includes a picture of bags of “Siriver Lucerne”, a legume, bearing the SEEDCO logo. Attached to this Declaration and marked as “CJM5” is an extract from the booklet depicting the “First Seedco Promotion” from the 1960s.

   When [the Removal Opponent] was formed in 2003, [the Removal Opponent] took over Seedco’s large existing stock of bags marked with the SEEDCO trade mark and [the Removal Opponent] has continued to use up this stock of bags since this time. These types of bags can last for many years. Bags are stockpiled in bundles at the processing sheds ready to be filled with seeds or grains. Bags are not re-filled with seeds or grains once they have been used.

   Attached to this Declaration and marked as “CJM6” are photographs of bags bearing the SEEDCO mark. The first two photographs are of a bag featuring only the SEEDCO mark. The other four photographs are of a bag featuring both the SEEDCO mark and the SEEDMARK mark. I understand that there was a transition period after the formation of [the Removal Opponent] in 2003 during which time bags were printed featuring both marks as is illustrated by these photographs. [The Removal Opponent] now prints bags featuring only the SEEDMARK mark. Since 2003 there have consequently been bags in circulation featuring (a) only the SEEDCO mark (b) both the SEEDCO mark and the SEEDMARK mark and (c) only the SEEDMARK mark.

   I verily believe that [the Removal Opponent] sold seeds and grains in Australia in bags featuring the SEEDCO mark [during the Relevant Period] and I believe that sales of seeds and grains in such bags during this period were substantial. I also verily believe that [the Removal Opponent] exported seeds and grains in bags marked with the SEEDCO mark during this time.

4. There is a situation, therefore, where the Removal Opponent is allegedly using up, or exhausting a large supply of 25 kg bags on which the Trade Marks are used although use of the Trade Marks is being phased out in favour of the SEEDMARK trade mark.

5. As regards substantiating this allegation, Mr Myall states:

   I have been unable to track back to find an invoice relating to the sale of product in bags featuring the SEEDCO mark between 25 January 2008 and 25 January 2011 as it is not straightforward to identify which bags were used for particular sales (ie to identify whether the bags used for particular sales were marked with the SEEDCO mark or the SEEDMARK mark or both). I have, however, identified an invoice relating to a more recent sale. Attached to this Declaration and marked “CJM7” is a photograph of a representative of Total Agronomy Pty Ltd, a longstanding supplier of my Company located in Warragul in Victoria, beside a bag featuring the SEEDCO mark. Attached to this Declaration and marked “CJM8” is a copy of the invoice relating to the sale of this product dated 25 July 2011 and photographs of a bag featuring the Line Number listed on the invoice (the same bag as featured in four of the photographs included in “CJM6”). I have been able to confirm that this invoice relates to product sold in bags featuring the SEEDCO mark by tracking the Line Number listed on the invoice. The Line Number listed is N18/4-091. “N18” refers to the packing shed and “4” indicates that the product was produced in 2004. My Company’s computer system identifies that 7350 kg of this product was produced.

6. The invoice and photographs attached to Mr Myall’s declaration verify his account of the sale of these seeds.

7. Mr Myall also supplies a photograph of a McCarthy Transport truck bearing the SEEDCO Logo trade mark and states that the truck featuring this advertisement has been used by McCarthy Transport for the transport of seeds and grains between South Australia and Victoria for approximately 10 years and during the Relevant Period/

8. The declarations of Mr Redemski of Elders Gambier Farm Supplies and Mr Robertson of Langseeds attest to the ongoing presence in the rural supplies stores in which they work of pamphlets featuring the Trade Marks.  As the Applicant observes in its submissions, “The brochures were printed and supplied well before the Relevant Period, and continue to be in the possession of suppliers simply because they have not been replaced with rebranded materials.”  However, the depletion or exhaustion of the supply of brochures may objectively be seen to match the depletion or exhaustion of the Removal Opponent’s 25 kg seed bags which bear the Trade Marks.

9. The above evidence indicates that there remains a strong residual reputation in the Trade Marks.  In McCormick & Company Inc v McCormick [2000] FCA 1335, (2000) 51 IPR 102, Kenny J said, at [81]-[82]:

   What is intended by the word "reputation" in s 60? The word is defined in The Macquarie Dictionary as follows:

   reputation ... 1. the estimation in which a person or thing is held, esp. by the community or the public generally; repute ... 2. favourable repute; good name ... 3. A favourable and publicly recognised name or standing for merit, achievement, etc. ... 4. The estimation or name of being, having done, etc, something specified.

   Cf. The Oxford English Dictionary. In s 60, the word is, I think, apt to refer to "the recognition of the McCormick & Co marks by the public generally".

   Does the evidence establish that in Australia before 9 March 1992 the McCormick & Co marks were recognised by the public generally and, because of that, the use by Mary McCormick of her marks would be likely to cause the public confusion, as for example, by the public's mistakenly attributing a business connection between the two or attributing her product to the company?

10. In terms of the above test in McCormick, and the evidence supplied by the Removal Opponent I would assess the residual reputation in the Removal Opponent’s Trade Marks as persisting with some force in the relevant market.

Use of the Trade Marks?

1. Section 17 of the Act provides:

   17What is a trade mark?

   A trade mark is a sign used, or intended to be used, to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person.

   Note:For sign see section 6.

2. Subsection 7(4) of the Act provides:

   (4)  In this Act:

   use of a trade mark in relation to goods means use of the trade mark upon, or in physical or other relation to, the goods (including second‑hand goods).

3. And section 9 of the Act provides:

   9Definition of applied to and applied in relation to

   (1)For the purposes of this Act:

   (a)a trade mark is taken to be applied to any goods, material or thing if it is woven in, impressed on, worked into, or affixed or annexed to, the goods, material or thing; and

   (b)a trade mark is taken to be applied in relation to goods or services:

   (i)if it is applied to any covering, document, label, reel or thing in or with which the goods are, or are intended to be, dealt with or provided in the course of trade; or

   (ii)if it is used in a manner likely to lead persons to believe that it refers to, describes or designates the goods or services; and

   (c)a trade mark is taken also to be applied in relation to goods or services if it is used:

   (i)on a signboard or in an advertisement (including a televised advertisement); or

   (ii)in an invoice, wine list, catalogue, business letter, business paper, price list or other commercial document;

   and goods are delivered, or services provided (as the case may be) to a person following a request or order made by referring to the trade mark as so used.

   (2)In subparagraph (paragraph (1)(b)(i):

   covering includes packaging, frame, wrapper, container, stopper, lid or cap.

   label includes a band or ticket.

4. It is the Removal Applicant’s submission that none of the Removal Opponent’s activities in relation to the Trade Marks constituted use of the Trade Marks during the Relevant Period.  The argument is put thus:

   (1)      the Removal Opponent provided products in old grain bags bearing the Trade Marks, that are no longer in print;

   (2)      there are some seed providers who have in their possession brochures bearing the Trade Marks printed 10 years ago, which have not been replaced with rebranded materials;

   (3)      there are brochures and product guides printed before the Relevant Period used to inform the public of the acquisition of SL in 2003 by the Removal Opponent; and

   (4)      a truck which has been transporting the seeds from 2001 bears the Trade Marks.

   The Removal Applicant notes the Opponent’s evidence demonstrates that it rebranded to”SEEDMARK” in 2003, and the Removal Opponent no longer uses the Trade Marks in advertising or in connection with its products.

   The Removal Opponent has conceded in its evidence that:

   (i)it no longer uses the Trade Marks on any grain bags, brochures, advertising materials or any products produced within the Relevant Period;

   (ii)the grain bags bearing the Trade Marks were not in print during the Relevant Period, and the Removal Opponent was using the bags merely in order to “use up this stock of bags”;

   (iii)after 2003 the grain bags were produced bearing the new branding, and that the Removal Opponent now only prints grain bags bearing the Removal Opponent’s current trade mark;

   (iv)the brochures were printed and supplied well before the Relevant Period, and continue to be in the possession of suppliers simply because they have not been replaced with rebranded materials;

   (v)any orders for seeds or products arising from the brochures throughout the Relevant Period were satisfied by the provision of seeds and products under the new company branding, and not the Trade Marks; and

   (vi)the relevant truck was branded with the Seedco Trade Mark well before the Relevant Period, and has not been updated since the 2003 rebranding.

5. The Removal Applicant thus implicitly concedes that the Removal Opponent sold seed in bags during the Relevant Period bearing the Trade Marks but argues that this use was not a use of the trade marks as defined by the Act.

6. In E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2010] HCA 15; (2010) 241 CLR 144; (2010) 265 ALR 645; (2010) 86 IPR 224; (2010) 84 ALJR 352; [2010] AIPC 92-381 at [51] and [52] the High Court stated:

   The capacity of a trade mark to distinguish a registered owner’s goods from those of others, as required by s 17, does not depend on whether the owner knowingly projects the goods into the Australian market. It depends on the goods being in the course of trade in Australia. Each occasion of trade in Australia, whilst goods sold under the trade mark remain in the course of trade, is a use for the purposes of the Trade Marks Act. A registered owner who has registered a trade mark under the provisions of the Trade Marks Act can be taken, in general terms, to have an intention to use that trade mark on goods in Australia. It is a commonplace of contemporary international trade that prior to consumption goods may be in the course of trade across national boundaries.

   An overseas manufacturer who has registered a trade mark in Australia and who himself (or through an authorised user) places the trade mark on goods which are then sold to a trader overseas can be said to be a user of the trade mark when those same goods, to which the trade mark is affixed, are in the course of trade, that is, are offered for sale and sold in Australia. This is because the trade mark remains the trade mark of the registered owner (through an authorised user if there is one) whilst the goods are in the course of trade before they are bought for consumption [Estex Clothing Manufacturers Pty Ltd v Ellis and Goldstein Ltd (1967) 116 CLR 254 at 266-267]. As affirmed by Gummow J in Wingate Marketing Pty Ltd v Levi Strauss & Co [1994] FCA 1001; (1994) 49 FCR 89 at 136 “whilst a trade mark remains on goods, it functions as an indicator of the person who attached or authorised the initial use of the mark”. During the trading period, the trade mark functions as an indicator of the origin of the goods, irrespective of the location of the first sale.

   [Emphasis added]

7. In my consideration, in the sale of the bags bearing the Trade Marks during the Relevant Period, the Trade Marks were in the course of trade during the Relevant Period and functioned so as to indicate a connection in the course of trade between the owner of the Trade Marks and the goods.

8. The Removal Applicant has established its opposition to the removal of the Trade Marks from the Register of Trade Marks.

9. Should I be wrong in the above, I will now consider the Registrar’s discretion.

Discretion

1. Subsection 101(3) of the Act provides:

   (3)  If satisfied that it is reasonable to do so, the Registrar or the court may decide that the trade mark should not be removed from the Register even if the grounds on which the application was made have been established.

2. In Austin, Nichols & Co Inc v Lodestar Anstalt [2011] FCA 39; (2011) 90 IPR 310 (‘Lodestar’) at [126] and [127] Cowdroy J said:

   Section 101(3) of the Trade Marks Act invests the Registrar of Trade Marks and the Court with a broad discretion to allow a trade mark to remain upon the register even if the grounds on which an application for removal was made have been established.

   The discretion is unlimited: see Pioneer Computers Australia Pty Ltd v Pioneer KK [2009] FCA 135; (2009) 176 FCR 300 at [167], [172] and [173]. Further, it is unnecessary to demonstrate that ‘exceptional circumstances exist before the discretion may be exercised in favour of the holder of the trademark’: see Kowa Company Ltd v NV Organon [2005] FCA 1282; (2005) 66 IPR 131 at [98]; Pioneer Computers at [168]; E & J Gallo Winery v Lion Nathan Australia Pty Ltd (ACN 008 596 370) [2008] FCA 934; (2008) 77 IPR 69 at [198].

3. In Lodestar at [131] His Honour stated:

   Pioneer Computers, Bennett J at [169] succinctly stated the principles arising from Hermes[1] and adopted by Flick J in E & J Gallo Winery as follows:

   In E & J Gallo [2008] FCA 934; 77 IPR 69 at [202]- [203], Flick J stated that the following factors set out by Falconer J in Hermes Trade Mark [1982] RPC 425 were of assistance in considering the exercise of the discretion:

   ·     there had been no abandonment of the trade mark;

   ·     the registered proprietors of the mark still had a residual reputation in the mark;

   ·     there had been sales by the registered proprietors of goods for which removal was sought since the relevant period ended;

   ·     the applicants for removal had entered the market without having taken steps to ascertain from the Register whether anyone had a right to exclude their use of the mark;

   ·     the registered proprietors were not aware of the applicant’s sales under the mark.

   [1] Hermes Trade Mark [1982] RPC 425.

1. The first three dot-points, above, appear on the evidence before me to be satisfied.  In regards to abandonment, Bowen C.J., Northrop and Lockhart JJ. said in Re Riv-Oland Marble Co (Vic) Pty Ltd v Settef SpA [1988] FCA 344 at [9]:

   However, in my opinion, to show abandonment of the mark in circumstances such as the present it would be necessary to demonstrate more than slightness of use. There would have to be some evidence indicating an intention to abandon the trade mark to result in the right to proprietorship being lost; see Mouson & Co v Boehm (1884) 26 Ch D 398 at 405.

2. While it is apparent that the use of the Trade Marks is being phased out by the Removal Opponent, this phasing out did not, during the Relevant Period, constitute an abandonment of the Trade Marks (although eventually it might transpire to be such) and, as I have found above, the Trade Marks were in fact used during the Relevant Period.

3. Here, of course, there is no evidence from the Removal Applicant of whether it took steps to ascertain from the Register whether anyone had a right to exclude its use of the mark or if the Removal Applicant has used a relevant trade mark.  The Removal Opponent’s evidence is suggestive of a quite different course of action by the Removal Applicant.  In his declaration Mr Myall states:

   I am aware that the Removal Applicant has filed Trade Mark Application No. 1412448 for “SEEDCO” covering the following goods in classes 31 and 35:

   Class 31: Agricultural, horticultural and forestry products and grains not included in other classes; fresh fruits and vegetables; live animals; natural plants and flowers; foodstuffs for animals; seeds and grains including legume and forage, seeds, cereals, pulses and vegetable seeds; wheat, canola, barley, sorghum, triticale, oats, field peas, lupins, beans, chickpeas, faba beans, mung beans and rice; animal and livestock fattening preparations

   Class 35: Marketing, advertising and promotional services; business administration, consultancy, development and management; arranging trade exhibitions and shows; wholesale and retail services, including wholesaling and retailing of agricultural products including seeds and grains; import and export agency services; advisory, information and consultancy relating to the aforementioned services

   I am also aware that there is a trade mark registration (No. 1406524) in the name of the Removal Applicant for the composite mark depicted below.

   Attached to this Declaration and marked as “CJM17” is a print-out showing the details of Trade Mark Registration No. 1406524

   Attached to this Declaration and marked as “CJM18” is a print-out showing the registration details for the domain name seedco.com.au The registrant is listed as Seed Distributors Pty Ltd. Seed Distributors Pty Ltd is one of my Company’s competitors. Attached to this Declaration and marked as “CJM19” is a print-out from the website at The address listed (14-16 Hakkinen Rd, Wingfield, SA 5013) is the same address as that listed for Trade Mark Nos. 1412448 and 1406524 in the name of Seedco Australia Pty Ltd. Attached to this Declaration and marked “CJM20” are extracts from the ASIC database showing the company details for Seedco Australia Pty Ltd and Seed Distributors Pty Ltd. The principal place of business for both companies is listed as 14-16 Hakkinen Rd, Wingfield, SA 5013 and the same director is listed for each company.

4. Considered in combination, the applications for registration filed by the Removal Applicant suggest that it was well aware of the Removal Opponent’s trade marks and their strong residual reputation prior to both the filing of its applications for registration and these applications under section 92 of the Act.

5. Further, it would appear to me that the removal of registration 755807(31) SEEDCO from the Register would appear to serve no useful purpose because (absent evidence from the Removal Applicant to the contrary) the Removal Opponent is, prima facie, in a position to successfully oppose registration of application 1412448(31)(35) SEEDCO at least on a ground under section 58 of the Act based on the prior use of its identical SEEDCO trade mark in relation to goods and services which are the same kind of thing as, inter alia, seeds and the supply of seeds.

6. On this basis, the Registrar’s discretion in this matter should be exercised in favour of the Removal Opponent.

Decision

1. Section 101 of the Act provides:

   101Determination of opposed application—general

   (1)Subject to subsection (3) and to section 102, if:

   (a)the proceedings relating to an opposed application have not been discontinued or dismissed; and

   (b)the Registrar is satisfied that the grounds on which the application was made have been established;

   the Registrar may decide to remove the trade mark from the Register in respect of any or all of the goods and/or services to which the application relates.

2. I decide not to remove the Trade Marks in respect of any of the goods for which they are registered.

Costs

1. Having been successful in these matters, the Removal Opponent is entitled to its costs apportioned appropriately between these matters as per the official scale.

Iain Thompson

Hearing Officer

Trade Marks Hearings

26 September 2012