SouthCorp Brands Pty Limited v Eastern tomorrow jinjiang Import and Export Co Ltd

[2018] ATMO 38

TRADE MARKS ACT 1995

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

Re:Opposition by Southcorp Brands Pty Limited to registration of trade mark applications 1757197 (33) – RUSH RICH and stylised turret/tower and arc device and 1757198 (33) – RUSH RICH and Chinese characters – filed in the name of Eastern Tomorrow (Jinjiang) Import and Export Co., Ltd.

Delegate:	Cristy Condon
Representation:	Opponent: Ben Fitzpatrick of Counsel instructed by Andrew Butler of Wrays Applicant: Blake Knowles of Cullens Patent and Trade Mark Attorneys
Decision:	2018 ATMO 38 Trade Marks Act 1995 – s 52 proceedings – ss 42, 58, 59, 60 and 62A – Trade Marks filed in bad faith – Trade Marks rejected.

Background

1. On 7 March 2016 Eastern Tomorrow (Jinjiang) Import & Export Co., Ltd (‘the Applicant’) filed two trade mark applications (‘the applications’). Relevant details of the applications appear below:

Trade mark	(‘Rush Rich mark’)	(‘Chinese Character mark’)
Trade mark no.	1757197	1757198
Filing date	7 March 2016	7 March 2016
Specification of goods	Class: 33 Fruit extracts (alcoholic); Baijiu (Chinese distilled alcoholic beverage); Vodka; Brandy; Spirits (beverages); Digesters (liqueurs and spirits); Liqueurs; Rice alcohol; Aperitifs; Wine	Class: 33 Fruit extracts (alcoholic); Baijiu (Chinese distilled alcoholic beverage); Vodka; Brandy; Spirits (beverages); Digesters (liqueurs and spirits); Liqueurs; Rice alcohol; Aperitifs; Wine
Endorsement	The applicant has advised that the CHINESE characters appearing in the trade mark may be transliterated as BEN FU which may be translated into English as RUSH; RICH.

1. Following examination of the applications the Rush Rich mark and the Chinese Character mark (collectively ‘the Trade Marks’) were advertised as accepted for possible registration in the Australian Official Journal of Trade Marks on 28 July 2016.

2. Southcorp Brands Pty Ltd (‘the Opponent’) filed the Notices of Intention to Oppose the registration of the Trade Marks on 13 September 2016 followed by the Statements of Grounds and Particulars (‘SGP’) on 11 October 2016.

3. The Applicant filed the Notices of Intention to Defend on 10 November 2016.

4. The evidence stage commenced and the Opponent filed the following declarations as evidence in support of both of the oppositions:

• Owen John Malone (Director Intellectual Property, of Treasury Wine Estates Limited) made on 17 February 2017 with accompanying Exhibits OJM-1 to OJM-12 (‘Malone’); and,

• Liz Ge (occupation unspecified) made on 17 February 2017 with accompanying Exhibits LG-1 to LG-6 (‘Ge’).

1. The Applicant did not file evidence in answer, therefore, the declarations and exhibits described in [5] above constitutes the entire evidence filed in relation to both of the applications.

2. The Opponent made a request to be heard in relation to the opposition matters and, in accordance with my directions that were sent by email on 25 October 2017, the hearings were set down to be heard together in one hearing on 7 December 2017. The parties filed written submissions in respect of the Trade Marks prior to the oral hearing.

3. The matters came before me, a delegate of the Registrar of Trade Marks on the scheduled day. The Opponent was represented by Mr Ben Fitzpatrick of Counsel who was instructed by Mr Andrew Butler of Wrays. The Applicant was represented by Mr Blake Knowles of Cullens Patent and Trade Mark Attorneys.

4. Also present at the hearing were Mr Zhao, who is the CEO of the Applicant’s associated Australian company ‘Australia Rush Rich Winery Pty Ltd’, and Mr Zhang, who is Mr Zhao’s assistant. They did not participate in the hearing.

5. At this time I will momentarily defer to the evidence filed in these proceedings as it provides the following information about each of the parties involved in these matters:

The Opponent

1. Mr Malone says the Opponent is a part of the Treasury Wine Estates Limited (‘the Treasury’) which is one of the world’s largest premium wine producers. He does not explain the nature of the relationship but this is unimportant to the grounds of opposition discussed below. In his declaration Mr Malone claims the Treasury controls more than 15,000 hectares of vineyards in the wine regions of the Barossa Valley in Australia, the Napa Valley in California, New Zealand and Italy. This amounts to more than 20 wineries throughout the world.[1]

   [1] Ms Ge refers to the Treasury being the Opponent’s parent company; see Ge, [6].

2. One of the Treasury’s brands is ‘Penfolds’ and it is a well-known brand of Australian wine. According to Mr Malone it was founded in 1844[2].

   [2] Malone, [8].

3. The ‘Penfolds’ wine brand is at the centre of the dispute in these proceedings.

The Opponent’s trade marks

1. The Opponent claims to use the following two trade marks in relation to its ‘Penfolds’ wines:

   (‘the Opponent’s Chinese Characters mark’) and;

   (‘the Opponent’s Crest mark’).

The Applicant

1. The Applicant is recorded on each of the applications as Eastern Tomorrow (Jinjiang) Import & Export Co., Ltd. It has not provided any evidence in these proceedings; however, the Opponent’s evidence does provide some insight into the Applicant. In this regard, Mr Malone deposes:

   The Chinese language version of the Applicant’s name is 东方明日（晋江）进出口有限公司.

   …

   the Applicant has represented to IP Australia that its equivalent name in English is Eastern Tomorrow (Jinjiang) Import and Export Co. Ltd.

   However, in respect of its Chinese trade mark applications, the Applicant has represented to the Chinese Trade Mark Office that its equivalent English name is East Bright Sunshine Import and Export Co. Ltd.[3]

   [3] Malone, [58].

Grounds of Opposition and Onus

1. In relation to the opposition to the Chinese Character mark the SGP nominates 5 grounds of opposition available under ss 42, 58, 59, 60 and 62A of the Act.

2. In relation to the opposition to the Rush Rich mark the Opponent relies on ss 42, 59, 60 and 62A of the Act.

3. These grounds were pursued by the Opponent at the oral hearing on 7 December 2017. I note that the s62A ground was heavily relied on by the Opponent at the oral hearing.

4. The Opponent bears the burden to establish one or more of its grounds of opposition on the balance of probabilities.[4]

   [4] See Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133] affirming the approach of Gyles J in Pfizer Products Inc. v Karam [2006] FCA 1663, [26].

5. The date at which the rights of the parties are to be determined[5] is 7 March 2016, which in this case, is the filing date (‘the relevant date’).

Evidence

[5] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 595, see also s 29(1) Trade Marks Act 1995 (Cth).

The Opponent’s Evidence

1. Malone contains the following claims/statements, paraphrased below:

   ·     The Treasury became the world’s largest listed wine company in 2011. It maintains a website at penfolds.com.

   ·     ‘Drinks International’ crowns ‘Penfolds’ the ‘World’s Most Admired Wine Brand’ in March 2016. [6]

   [6][6] Malone, [10]; OJM-1.

   ·     In 1995 a company named Whitehorse Holdings, based in Guangzhou, China, was appointed by the Southcorp Wines Asia Pty Ltd (the Opponent’s related company) as the exclusive distributor in China for ‘Penfolds’ wines. Mr William Han, the owner of Whitehorse Holdings, translated the ‘Penfolds’ brand to the Chinese name ‘Ben Fu’ being the Chinese phonetic approximation of ‘Penfolds’. Mr Malone says that Mr Han also recommended that Southcorp Wines adopt the aforementioned Chinese character version of this name for ‘Penfolds’ in China.[7] These are the Chinese characters that appear in the Opponent’s Chinese Character mark at [14] of this decision.

   [7] Malone, [11] - [12].

   ·     Mr David Combe, a former politician and diplomat who was senior Vice-President International of the Treasury’spredecessor company in the 1990’s was responsible for the company’s Asian strategy and for its substantial growth in export markets including China.[8]

   ·     Whitehorse Holdings as exclusive distributor of ‘Penfolds’ wines, advertised the ‘Penfolds’ brand, the Opponent’s Chinese character mark and the Opponent Crest mark in relation to wine, in China, through advertisements showing those brands on, for example, the sides of buses, in trade magazines, and on outdoor banners.[9]

   ·     Between 1999 and 2004 the Treasury’s exclusive distributor changed a few times but by 2004, ASC Fine Wines, which was at the time the number one wine distributor in China, was appointed as the exclusive distributor of ‘Penfolds’ wines in China. The ‘Penfolds’ brand and the Chinese character, , version of the name ‘Ben Fu’ continued to be used in the Chinese marketplace for ‘Penfolds’ wines by ASC Fine Wines on behalf of the Treasury and/or the Opponent.

   ·     The market for ‘Penfolds’ wines in China has seen exponential growth in demand, and sales of ‘Penfolds’ wines in China now account for much of the Treasury’s annual global turnover which is in the billions of dollars.[10]

   ·     The Treasury began using the online Chinese language marketplace platform Tmall.com/ via an ASC Fine Wines Tmall store to sell ‘Penfolds’ and Chinese Character mark, , brand wines to Chinese and international consumers. Australian consumers could also purchase Penfolds/brand wine products from this marketplace store.

   ·     At the end of 2015, the Treasury’s Chinese business assumed control of its e-commerce business in China, and it was then that the Treasury established its own flagship store on Tmall.com and offered the ‘Penfolds’ brand wines including those branded with the Chinese characters.

   ·     The sale of ‘Penfolds’/products on Tmall.com is also available to Australian consumers.[11] Offers for sale of ‘Penfolds’/brand wine products have been made continuously from 2014 to date.[12] I note for now that there is no contemporaneous evidence of this in any of the exhibits.

   ·     The Opponent’s Chinese character mark and the Opponent’s Crest mark contain the same Chinese characters and they are also the same Chinese characters as those in the Applicant’s Chinese Character mark.

   ·     The parties have been involved in legal disputes in China prior to the relevant date. Mr Malone says that one of these actions resulted in a bad faith finding on the Applicant’s part[13] and that the Treasury was deemed to be the owner of the ‘Ben Fu’ trade mark in China.[14]

   ·     The Applicant has also filed applications to register 17 trade marks in China, in class 33, in respect of trade marks containing the Chinese characters [15]

   [8] Malone, [14].

   [9] Malone, [15].

   [10] Malone, [21].

   [11] Malone, [31]; Ge, [25].

   [12] Malone, [32].

   [13] See Malone, [71]. The ‘Bad Faith’ finding was in relation to the Applicant’s Chinese trade mark registration no. 11157214 that consists of Chinese characters for which the Chinese phonetic approximation is ‘ben fu jiu yuan’, and its English translation is ‘Penfolds Wine Estate’.

   [14] See OJM-4 which contains a press release dated 17 January 2017 which describes the Treasury’s success in the Beijing People’s Court legal action, confirming the Treasury’s right to use the ‘Ben Fu’ mark in China.

   [15] See OJM-10 for a list of these trade mark applications.

2. In relation to this last dot point Mr Malone says (emphasis added):

   ·     The Opponent is aware of a number of the Applicant’s trade marks in China which contain the Chinese characters  (ben fu / Penfolds) as part of the Applicant's attempts to secure a registered trade mark position for property misappropriated from of the Opponent.

   ·     I note for example the Applicant’s Chinese trade mark registration no. 11157214 for  , for which the Chinese phonetic approximation is 'ben fu jiu yuan', and the English translation is 'Penfolds Wine Estate', which was filed on 3 July 2012. The Opponent first took action in China against that registration on 10 July 2014, and has since been successful in a bad faith invalidation action against that registration.

   ·     I also note the Applicant’s Chinese trade mark registration no 11230365 for  , for which the Chinese phonetic approximation is 'da li ya ben fu jiu zhuang', and the English translation is 'Australian Penfolds Wine Estate', which was filed on 19 July 2012.

   ·     I also note the Applicant’s Chinese trade mark application no. 19016445 for , for which the Chinese phonetic approximation is 'ben fu jiu yuan ao xin' and the English translation is 'Penfolds Winery Australia Heart', which was filed on 28 January 2016.

   ·     It is clear from the foregoing that the Applicant was aware of the Opponent, of the Opponent’s claimed rights in the Ben Fu / Penfolds / Chinese character mark , and of the Opponent’s concerns about the Applicant’s adoption of trade marks containing the Opponent’s own brand in China, well before it filed the present applications in Australia on 7 March 2016.

   ·     A review of the Chinese Trademark Office database indicates that the Applicant has not filed an application in China for registration of one of the opposed marks in these proceedings, namely because it knows that it would fail having regard to its knowledge of the Opponent's true ownership of the Chinese characters in China.

   ·     With regard to the trade mark the subject of application no 1757197 a Chinese company named Bao Le Li Jia Wines Co., Ltd. (which is also known as “Jinjiang Pernod Ricard Wine Co., Ltd.), whose Chinese name is “晋江保乐力加酒业有限公司”), located at Room 112-212, Building No. 4 #2, Huatai International Xincheng, Luo Shan Street, Jinjiang City, Quanzhou City, Fujian Province, China, is the owner of a registration for that mark in China.

   ·     The above-named company has also sought to register a number of trade marks in China in order to misappropriate the Opponent's rights, including the following:

   ·     Application No 11018259 for (Ben Fu Ao Zhou, meaning 'Penfolds Australia') in Class 33: This mark was rejected by the Chinese Trademark Office and is invalid.

   ·     Application No 11230285 for (Ao Zhou Ben Fu Jiu Yuan, meaning 'Australia Penfolds Winery') covering services such as “advertising; import & export agency ; sales promotion for others’ in class 35: This mark was also rejected by the Chinese Trade Mark Office and is invalid.

   ·     The legal representative of that company is a Chinese individual, Zeng Xianming (曾贤明), who is also one of the shareholders of the Applicant Eastern Tomorrow (Jinjiang) Import and Export Co Ltd, also known as East Bright Sunshine Import and Export Co Ltd in China as previously discussed herein.

   ·     The above trade mark ownership structure is again clearly calculated to hide or blur the close connection between the Applicant and its closely related entities, all of whom are engaged in the same fraudulent misappropriation of the Opponent's reputation, property and rights. [16]

   [16] Malone, [70]-[79].

3. Copies of pages from benfucn.com (which is the website referred to by Mr Malone in [22] above) and penfolds.com are included in Exhibit OJM-11. Mr Malone goes on to state that this benfucn.com website is accessible to Australian consumers and is clearly either the Applicant’s website or one which is administered by an entity connected with the Applicant, because of the prominent presence of the Rush Rich mark, and explicit mention of the Trade Marks. I note that this website is a rather shameless copy of the penfolds.com website. The only noticeable difference is that it is headed with the Rush Rich mark (where ‘Penfolds’ is on the penfolds.com equivalent webpage) and it is all in Chinese language but both websites have the same page layout, include the same photos of the Treasury’s ‘Penfolds’ staff, etc.

4. The Opponent relevantly submits [50]:

   A consideration of the websites at the Chinese language version of (which may be accessed by selecting ‘China’ from the drop down menu of the home-page of and reinforces the Applicant’s bad faith.

   Apart from being in a different language, the content of the English and the Chinese language versions of are the same.[17]

   [17] Ge, [7].

5. Further and obviously aimed at the Applicant’s character, Mr Malone says the Applicant has attempted to misappropriate the trade marks of others.[18]

   [18] See OJM-9 for Australian trade mark applications for ‘BENTLEY’ in class 33.

6. The rest of the Opponent’s evidence is a declaration from Ms Ge together with Exhibits LG-1 to LG-6. Ms Ge has no affiliation with the Opponent or the Treasury and is she is fluent in both English and Mandarin Chinese having moved from Shanghai, People’s Republic of China to Australia when she was 20 years old (she does not say how long she has been living in Australia).[19]

   [19] Ge, [1].

7. According to Ms Ge the word ‘Penfolds’, the Chinese characters  and ‘Ben Fu’ are synonymous. She says the Chinese characters are the Chinese character version of ‘Penfolds’. The transliteration of which is ‘Ben Fu’. [20] In other words ‘Ben Fu’ is the Chinese phonetic expression of ‘Penfolds’.

   [20] Ge, [9].

8. Ms Ge also claims that the Applicant’s endorsement, which appears on the Chinese Character mark’s application, says that the Chinese characters can be translated in to English as ‘Rush Rich’ and this is :

   ‘a direct, rough and very superficial way of translating the Chinese characters. Mandarin Chinese is a far more subtle and complex language than being a simple literal reflection at face value of the Chinese characters as they are represented, and requires a much deeper interpretation and understanding of the underlying meaning of the characters in order to arrive at a proper English translation.

   I firstly observe in that regard that the words RUSH RICH are ungrammatical in English and are therefore really meaningless, which immediately indicates to me the misleading nature of Eastern Tomorrow’s deliberate attempt to transliterate the Chinese characters into English words which do not capture the true essence of the Chinese characters, nor do they reflect the true nature of those characters.[21]

   [21] Ge, [10] – [11].

9. Exhibit LG-1 to Ge contains a copy of an incomplete sales catalogue that appears to have been produced by the Applicant or a related company. In this catalogue the Chinese characters are used many times including beneath the Rush Rich trade mark.

10. The sales catalogue in LG-1 also contains a copy of a photograph of wine barrels which is clearly an exact copy of the photo appearing on the Treasury’s website at penfolds.com and Malone says this was copied without the Treasury’s authority.[22] Ms Ge says the Rush Rich mark appears in this sales brochure and immediately below it are Chinese Characters which can be translated into English as ‘Australian Penfolds Vineyard’.

    [22] Malone, [50].

11. With respect to Exhibit LG-2, Ms Ge says she believes this is an extract from the Applicant’s or a closely related company’s on-line store at toaboa.com in which the Chinese characters appear repeatedly and the Rush Rich mark appears with the Chinese characters meaning 'Australian Penfolds Vineyard'. Relevantly, she also says that under a photograph which she observes to be the ‘Penfolds Magill Estate’ in South Australia are the words RAWSON’S RETREAT and immediately below these words are Chinese characters which translate to ‘Penfolds Winery’. She says the description that follows on that site also refers to the brand ‘Penfolds’ on a number of occasions.

12. Ms Ge states that the article in LG-3 about the history of ‘Penfolds’ leaves her with ‘no doubt that this article establishes that the Chinese characters  mean ‘Penfolds’ and that ‘Penfold’s’ or the Chinese character equivalent was known to the Chinese public as early as 1995.[23] The following three exhibits described below also show that the Treasury’s ‘Penfolds’/brand wine is available for sale in China and can also be bought by Australian customers in Australia.

    [23] Ge, [15].

13. LG-4 consists of copies of webpages at taobao.com and tmall.com and the search results on the websites for the terms ‘Penfolds’ and the Chinese characters . These results show genuine ‘Penfolds’ brand products.

1. LG-5 consists of screenshot of the website taobao.com search results for the term ‘benfu’. In Australia Ms Ge claims that she can order and buy the Treasury’s ‘Penfolds’ wine from the taobao.com and tmall.com websites. This can be done through a Chinese language search engine called baidu.com.[24]

   [24] Ge, [24]-[25].

2. LG-6 consists of search results from the search engine baidu.com for ‘Penfolds’ and the Chinese characters .

The Applicant’s arguments

1. In terms of the s 62A ground of opposition, the Applicant’s arguments included that the question of bad faith must be decided with regard to the subject matter of each Trade Mark; that the allegations of the Treasury’s photographs being copied from its penfolds.com website is irrelevant for determining the subjective intention of the Applicant at the time it filed the applications.

2. The Applicant also says that the manner in which the Rush Rich mark has been argued is confusing, most notably due to the phrasing of this ground in the SGP. 

3. The Applicant submits:

   The ground speculates as to motives of the Applicant which are not supported by any objective evidence.  Conversely, the evidence shows that the mark is in fact in use in China, which leads to a logical inference (particularly given the goods are Australian wine), that the mark is in use in Australia. 

   Further, it is difficult to understand how the filing of a trade mark for Rush Rich & Tower could constitute bad faith, when the Opponent has never made any claim to rights in the term “Rush Rich”, nor in the tower device, and Rush Rich & Tower is neither identical or deceptively similar to trade marks in which the Opponent can claim rights in Australia or elsewhere.

   Further, given that the evidence does not establish the Opponent has any proprietorship or reputation in the Chinese character mark in Australia, it is not possible to conclude that the filing of the Rush Rich & Character mark constituted some attempt to usurp or misappropriate rights belonging to the Opponent. 

   The Opponent has no claim to the English words Rush Rich, and the characters in question are subject to differing interpretations. As such, there should not be a presumption that the Opponent has a monopoly over these characters, regardless of what other elements they may be combined with. In the absence of proprietorship or reputation in a particular mark, it is illogical to conclude that there has been bad faith.[25]

Discussion

[25] Applicant’s submissions, [78] – [81].

Section 62A

1. Section 62A of the Act provides:

   62A Application made in bad faith

   The registration of a trade mark may be opposed on the ground that the application

   was made in bad faith.

2. Some examples of applications made in bad faith are provided in the Explanatory Memorandum to the Trade Marks Amendment Bill 2006 and include:

• persons who monitor new property developments, register the names of new developments as trade marks for a number of services and then threaten the property developers with trade mark infringement proceedings unless the developers licence or buy the trade marks;

• persons who have a history of applying for trade marks that are deliberate misspellings of other registered trade marks;

• persons who identify trade marks used overseas but with no Australian use as yet who then apply to register the trade marks in Australia for the express purpose of selling them to the overseas owners.

1. According to DC Comics v Cheqout Pty Ltd[26] all of the circumstances surrounding the application to register a trade mark are relevant.  Moreover, conduct after the priority date can be used to shed light on the Applicant’s subjective intent at the relevant date.[27] I note also that the Explanatory Memorandum examples of applications made in bad faith are not intended to be exhaustive.

   [26] [2013] FCA 478 at [62] (‘DC Comics’).

   [27] See DC Comics at [71]; see also Conde Nast Publications Pty Ltd v Taylor (1998) 41 IPR 505 at 509 (‘Conde Nast’); Cited with approval in Monk v Travel Leaders Franchise Group LLC (2013) 102.

2. In Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2)[28] Dodds-Streeton J made the following comments, quoting from Harrison’s Trade Mark Application[29]:

   Clearly the court, when considering bad faith, cannot apply a purely subjective test, called by Lord Hutton ‘the Robin Hood test’. The dishonest person or one with low standards cannot be permitted to obtain trade mark registrations in circumstances where a person abiding by a reasonable standard would not. The registration of a trade mark is designed to enable bona fide proprietors to protect their proprietary rights without having to prove unfair trading. Registration is not provided to help those with low moral standards.

   … The words ‘bad faith’ suggest a mental state. Clearly when considering the question of whether an application to register is made in bad faith all the circumstances will be relevant. However the court must decide whether the knowledge of the applicant was such that his decision to apply for registration would be regarded as in bad faith by persons adopting proper standards.[30]

   [28] [2012] FCA 81 (‘Fry’).

   [29] [2004] EWCA Civ 1028; [2005] FSR 10.

   [30] [2012] FCA 81, [147].

3. Later in the same decision Her Honour also said:

   The formulation in United Kingdom authority of bad faith as falling short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in a particular area is, in my view, an apt touchstone. An overly literal application may, however, tend to negate the relevance attributed to the applicant’s mental state in the combined test preferred in Harrison.

   Further, in my view, mere negligence, incompetence or a lack of prudence to reasonable and experienced standards would not, in themselves, suffice, as the concept of bad faith imports conduct which, irrespective of the form it takes, is of an unscrupulous, underhand or unconscientious character.[31]

   [31] Ibid [165]-[166].

4. In these matters the ground of opposition pursuant to s 62A of the Act was particularised in each of the SGPs as follows:

   1757197 - For the reasons set out in Section 59 above, the Opponent believes that the Applicant filed the application with the intention of gaining some trade mark protection for the 'Rush Rich' element, knowing full well that its application no 1757198 was likely to fail because of the misappropriation from the Opponent of the Chinese character elements of that mark which are said by the Applicant to signify 'Rush Rich'. That conduct falls short of commercially acceptable standards of behaviour.

   1757198 - The Opponent adopted in both Australia and China for use in relation to wine well before the priority date of the application. The Applicant has sought to register a trade mark incorporating the characters in China, and that application has been opposed by the Opponent on the basis of bad faith and prior reputation. That opposition was initiated before the priority date of application no 1757198. It is apparent from the foregoing that the Applicant knew of the Opponent's trade mark before it filed application no 1757198. The Opponent therefore believes that the Applicant filed the application with the intention of gaining some benefit from doing so. That conduct falls short of commercially acceptable standards of behaviour.

Circumstances Surrounding the Applications for Registration

1. For the purposes of considering the s 62A ground of opposition it is useful, and I think necessary due to the way the ground was particularised in the SGP for 1757197, to look at the circumstances surrounding the filing of the applications. This includes the relevant actions of each party. There is no other way that I can determine the Applicant’s subjective intention as referred to by Streeton-Dodds J in Fry. Moreover, as I have already established above, DC Comics allows me to examine the circumstances surrounding the filing of the applications when considering the s 62A ground.

2. The authorities I have referred to above do not require the Trade Marks to be either deceptively similar or substantially identical to any trade marks used by the Treasury in relation to wine. Nor does the Opponent need to show that they have any rights in the Trade Marks. In this particular matter I understand the Opponent’s main contention to be that the Applicant is using the Trade Marks in very close association with the Treasury’s intellectual property that is its ‘Penfolds’ brand. For example ‘Penfolds Australian Winery’ appears under the Rush Rich mark in the evidence.[32]

   [32] See OJM-11.

3. In terms of the Opponent’s position, I am satisfied that as early as 1995 the Treasury had decided to expand its ‘Penfolds’ brand wine into China and over the next few years it decided to adopt an exclusive distributor for its ‘Penfolds’ wine in China which would be marketed, et al, under the Chinese characters . I am further satisfied that ‘Ben Fu’ is the phonetic equivalent of ‘Penfolds’ in English.

4. The evidence also shows that the inclusion of the words RUSH RICH in the Chinese Character mark may be an attempt to hide the meaning that underlies the pronunciation of the Chinese characters in addition to the questionable endorsement filed in respect of the Rush Rich mark.

5. The benfucn.com website, which I am satisfied, is owned by the Applicant or at the very least a body connected with the Applicant, contains images of the Treasury’s business which Malone says have been illegally copied directly from the Treasury’s website at ‘Magill Estate’ winery and restaurant, other proprietary images and material including photos of ‘Penfolds’ wine making staff appear on the benfucn.com website. The website is essentially the penfolds.com website in Chinese language.

6. This is, in my view, a flagrant attempt to pass off some association with the ‘Penfolds’ wine and the Treasury. The rendering of the Rush Rich mark in red font on a white background in the exhibits is a blatant attempt to pass its wine products off as being or associated with the ‘Penfolds’ brand, noting that the Treasury also use these colours in association with the ‘Penfolds’ brand.

7. While bad faith is a serious allegation, the burden carried by the Opponent in these matters is only the civil standard, and although the particularisation of s62A in the SGP for the Rush Rich mark was a little confusing, as has been outlined above, the evidence is less so.

8. Whilst it may the case that the Opponent has not been able to definitively show that the Applicant is connected to the benfucn.com website (because the Applicant has used so many different company names), the evidence shows: The Applicant has a common shareholder with Bao Le Li Jia Wines Co., Ltd, the owner of the Rush Rich mark in China; both the Chinese Character mark and the Rush Rich mark are being used in China, in the course of trade, in close connection to ‘Penfolds’ and/or with photos taken from the Treasury’s penfolds.com website. This association resulted in legal action in China, with a finding for the Opponent. The Applicant has wilfully attempted to obfuscate its association with this matter, by way of altering the translation of its business name.

9. I am satisfied that the evidence has established a pattern of behaviour on the Applicant’s part and/or its associated companies which has shifted the onus to the Applicant to show that it did not file the Trade Marks in bad faith. It has not filed any evidence in this matter.

10. I am also satisfied that it is more probable than not that the Applicant and/or its associated companies have tried to pass off the Trade Marks as being used in connection with ‘Penfolds’ wine or as if having some endorsed relationship with the Treasury in China. Given the benfucn.com website and the sales catalogue in LG-1 reinforces this association, it is reasonable to infer that is exactly what the Applicant intends to do with the applications in Australia.

11. It seems to me that the Applicant is attempting to usurp for itself the ‘Penfolds’ brand’s reputation by leveraging an ambiguity around the same marks it is using in China which include the phrase ‘Rush Rich’ and/or the Chinese characters which would be understood by the significant proportion of Australians bilingual in both English and Mandarin Chinese to indicate ‘Penfolds’.

12. I find that a person standing in the Applicant’s shoes should have known that it should not apply for the registration of the Trade Marks.  The Applicant’s conduct falls short of the ‘standards of acceptable commercial behaviour observed by reasonable and experienced persons’.[33]

    [33] DC Comics, [77].

13. The Opponent has established the ground of opposition under s 62A in regard to both trade mark numbers 1757197 and 1757198.

Decision

1. Section 55 of the Act relevantly 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 any ground on which the application was opposed has been established.

2. I am satisfied that there is a ground for rejecting the trade mark numbers 1757197 and 1757198 of the Act.

3. In accordance with s 55 of the Act, I reject trade mark application numbers 1757197 and 1757198.

4. If the Registrar of Trade Marks is served with a notice of appeal within one month from the date of this decision, I direct that the disposition of the applications be in accordance with the Court’s direction or order.

Costs

1. The Opponent has sought an award of costs in its favour. I see no reason to depart from the general rule that costs follow the event. As the Opponent has established a ground of opposition, in respect of application number 1757197 I award costs against the Applicant under s 221 of the Act in accordance with the amounts in Schedule 8 of the Trade Marks Regulations 1995. In respect of application number 175198 I award reduced costs against the Applicant under s 221 of the Act in the same manner as Hume Industries (Malaysia) Berhard v James Hardie & Coy Pty Ltd.[34]

   [34] [2001] ATMO 78.

Cristy Condon
Hearing Officer
Oppositions and Hearings
Trade Marks and Designs
14 March 2018