STI Technologies (Holdings) Unit Trust v Google Inc
[2018] ATMO 54
•17 April 2018
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re:Opposition by STI Technologies Holdings Pty Ltd as Trustee for the STI Technologies (Holdings) Unit Trust to application under section 92 of the Act by Google Inc. to remove trade mark number 1369862(9,12) - DVS - in the name of STI Technologies Holdings Pty Ltd as Trustee for the STI Technologies (Holdings) Unit Trust
| Delegate: | Katrina Brown |
| Representation: | Removal Opponent – Davies Collison Cave Removal Applicant – Gilbert + Tobin |
| Decision: | 2018 ATMO 54 Trade Marks Act 1995 – opposed application for removal under s 92(4)(b) – no use in the relevant period by the registered owner or an authorised user – discretion exercised in relation to some goods – registration to be partially removed – no award of costs. |
Background
STI Technologies Holdings Pty Ltd as Trustee for the STI Technologies (Holdings) Unit Trust (‘the Removal Opponent’) is the owner of the following trade mark registration:
| Trade Mark No: | 1369862 |
| Trade Mark: | DVS (‘the Trade Mark’) |
| Priority Date: | 1 July 2010 |
| Specification: | Class 9: Audio apparatus for vehicles; audio electrical apparatus for in-car entertainment; car audio apparatus; electrical apparatus for fitting to vehicles to display visual information; video apparatus; audio products for use in vehicles; portable media players; liquid crystal display (LCD) televisions; display monitors; monitors; video devices; electronic and recorded multimedia publications; multimedia multiplexers; frequency converters Class 12: Car body modification parts for sale in kit form; car body parts made of plastic materials; interior fittings (trim) for vehicles; interior panels for vehicles; linings for vehicles; security systems for vehicles (other than locks); vehicle ride control devices; vehicle windows incorporating aerials for radio reception |
On 2 March 2016 Google Inc. (‘the Removal Applicant’) filed an application pursuant to s 92(4)(b) of the Trade Marks Act 1995 (‘the Act’) seeking removal of the Trade Mark from the Register. The removal application was made in respect of all of the goods for which the Trade Mark is registered; that is complete removal of the Trade Mark from the Register.
The Removal Opponent filed a Notice of Intention to Oppose the removal application on 1 April 2016, followed by a Statement of Grounds and Particulars (‘SGP’) on 30 April 2016.
The Removal Applicant filed a Notice of Intention to Defend the removal application on 7 June 2016.
The Removal Opponent subsequently filed evidence in support of its opposition to removal of the Trade Mark. The Removal Applicant did not file evidence in answer.
Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing. As neither party requested a hearing, the matter has been allocated to me, a delegate of the Registrar of Trade Marks, to decide based on the written record.
On 7 April 2017 IP Australia informed the parties that they had one month from that date to file any written submissions that they wished to rely upon. On 8 May 2017, IP Australia was informed that the parties were actively negotiating and the deadline for filing written submissions was extended to 21 May 2017.
Both parties filed written submissions on 19 May 2017. At that time, the Removal Opponent also filed an additional declaration and requested that the delegate take it into consideration when deciding this matter. On 20 July 2017, the Removal Applicant filed submissions in relation to the additional declaration.
The Law
Part 9 of the Act deals with the removal of trade marks from the Register due to non-use. Section 92 relevantly provides:
(4)An application under subsection (1) or (3) (non-use application) may be made on either or both of the following grounds, and on no other grounds:
…
(b) that the trade mark has remained registered for a continuous period of 3 years ending one month before the day on which the non-use application is filed, and, at no time during that period, the person who was then the registered owner:
(i) used the trade mark in Australia; or
(ii) used the trade mark in good faith in Australia;
in relation to the goods and/or services to which the application relates.The Removal Applicant alleges that the Removal Opponent did not use the Trade Mark in the course of trade in Australia at any time in the three year period ending on 2 February 2016 (‘the Relevant Period’).
Pursuant to s 100(1)(c) of the Act, the Removal Opponent bears the onus of rebutting an allegation made under s 92(4)(b) by establishing that the registered owner used the Trade Mark in the course of trade in Australia during the Relevant Period in relation to the registered goods.
As the Registrar’s delegate observed in Courier Luggage Pty Ltd v Wenger SA Inc:[1]
The use must be genuine commercial use in accordance with the test in Imperial Group Ltd v Philip Morris & Co [1982] FSR 72. A single bona fide use of the trade mark during the non-use period may be sufficient to resist an application for removal: Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261; (2001) 51 IPR 149 at [17]. However, Wilberforce J, in Nodoz Trade Mark (1962) RPC 1 (Nodoz) at 7, said that if a registered owner relies on one single act of use of the trade mark, then that single act ought to be established by “if not conclusive proof, at any rate overwhelmingly convincing proof.”
The tribunal may not be persuaded by evidence that is solely from the internal files of the opponent: Nodoz, supra; or of a circumstantial nature: Trina Trade Mark [1977] RPC 131; although one invoice, if genuine, may suffice: Geo W McPherson v Remington (1999) 47 IPR 636.
[1] [2015] ATMO 10 [8].
In accordance with s 101 of the Act, the Registrar may decide to remove the Trade Mark for all or some of the goods identified in the removal application, or if satisfied it is reasonable to do so, decide not to remove the Trade Mark from the Register.
Evidence
To rebut the allegation of non-use, the Removal Opponent relies on the following declaration which was filed as evidence in support:
Declaration of Stavros Siolis (Director of the Removal Opponent) made on 16 September 2016 with Exhibits SS-01 to SS-11 (‘Siolis 1’).
Material filed out of time
At the time of filing its written submissions, the Removal Opponent sought to introduce additional material being a supplementary declaration of Stavros Siolis made on 19 May 2017 with Exhibits SS-12 to SS-13 (‘Siolis 2’).
Regulation 21.15(4) of the Trade Marks Regulations 1995 (‘the Regulations’) states:
The Registrar is not bound by the rules of evidence, but may be informed on any matter that is before the Registrar in a way that the Registrar reasonably believes to be appropriate.
Furthermore, reg 21.19 states:
Registrar may use information available
(1) If:
(a) information that is available to the Registrar is relevant to proceedings before the Registrar; and
(b) the Registrar has reason to believe that the information is not known to a party to the proceedings; and
(c) the Registrar proposes to take the information into account in making a decision in the proceedings;
before making the decision the Registrar must:
(d) provide the information to the party; and
(e) give the party a reasonable opportunity to make representations about the information.
(2) For the purposes of paragraph (1)(e), the representations may be made in writing or at a hearing or by such other means as the Registrar reasonably allows.
The Removal Opponent provided reasons for the admission of Siolis 2 in accordance with part 51.2.6 of the Trade Marks Office Manual of Practice and Procedure. In response, the Removal Applicant made submissions as to why Siolis 2 should not be allowed.
I have carefully considered the submissions put forward by both parties in relation to the admissibility of Siolis 2. Siolis 2 explains the relationship between the Removal Opponent and Directed Electronics Australia Pty Ltd (‘Directed Electronics’), the entity that the evidence of use contained in Siolis 1 relates to. In my opinion, the information in Siolis 2 is of high probative value and is crucial to my ultimate decision. I am also of the opinion that considering Siolis 2 is in the public interest of the Register being a true reflection of the marketplace.
My decision is to allow Siolis 2. In doing so, I draw on the words of Delegate Murray in AgCare Biotech Pty Ltd v Crop Smart Pty Ltd:
A serious opposition should be able to be decided on the merits of the case, with all relevant information available to the delegate of the Registrar for the making of that decision. This principle remains undiminished and is a potent factor to be weighed into the balance whenever a Registrar’s delegate exercises discretion under the legislation that has the potential to exclude evidence crucial to an opposition outcome.[2]
[2] [2015] ATMO 7 [40] footnotes omitted.
The Removal Applicant made representations about Siolis 2 at the time of submitting its arguments as to why it should not be admitted. As such the important principles of procedural fairness set out in reg 21.19 have been met.
Discussion and reasons
As this is a removal action, it is crucial that the Removal Opponent demonstrates that the registered owner, or an authorised user, has used the Trade Mark in Australia in relation to the registered goods within the Relevant Period.
Undated examples of the Trade Mark in use, or examples dated outside of the Relevant Period, are of little assistance to establishing use within the Relevant Period.
The following exhibits to Siolis 1 contain the only examples of use of the Trade Mark that are dated within the Relevant Period:
Exhibit SS-05
Exhibit SS-08
Exhibit SS-09
Exhibit SS-05 contains two advertisements with the handwritten date 28 July 2014. The first advertisement is by Directed New Zealand. This advertisement shows use of the Trade Mark however it contains New Zealand phone and fax numbers and an email and website address with the identifier .co.nz. As such I am not satisfied that it demonstrates use in Australia which is specifically required by s 92(4)(b)(i) of the Act. The second advertisement is by Directed Australia and shows use of the Trade Mark in relation to an in-car entertainment system. I note that the Removal Applicant questions the providence of the handwritten date. In this matter, it is not necessary for me to explore this further as Exhibit SS-08 and SS-09 contain clearly dated examples of the Trade Mark being used in Australia within the Relevant Period.
Exhibit SS-08 contains authorised dealer price lists from 2014 and 2015. These lists show use of the Trade Mark by Directed Australia in relation to in-car entertainment systems and accessories which can be described as:
Roof mounted screen and DVD loader, USB and SD reader, built in FM transmitter and headphones;
Headrest kit including monitors, FM MOD, Dual DVD, IR headphones, poles, games discs, wireless remote and zip up covers;
Digital mobile TV tuner; and
Wireless headphones.
Exhibit SS-09 contains invoices from Directed Australia to various retailers located in Australia. The ten invoices dated within the Relevant Period show use of the Trade Mark in relation to goods described as: headrest monitor with in-built DVD player and headphones.
The astute observer will have noted that Exhibits SS-08 and SS-09 demonstrate use of the Trade Mark with the Relevant Period by Directed Australia rather than the Removal Opponent.
On the evidence before me, it appears that Directed Electronics refers to itself in the marketplace as Directed Australia. The invoices issued by Directed Australia in Exhibit SS-09 contain the ABN 50 126 066 322. This is the same ABN that is on the ASIC extract for Directed Electronics. For the purpose of this decision, I will refer to them as Directed Electronics.
To successfully rebut the allegation of non-use the Removal Opponent must establish that Directed Electronics is an authorised user of the Trade Mark as contemplated by s 8 of the Act.
Authorised user
Section 7(3) of the Act specifies that:
An authorised use of a trade mark by a person (see section 8) is taken, for the purposes of this Act, to be a use of the trade mark by the owner of the trade mark.
Section 8 of the Act relevantly provides:
(1) A person is an authorised user of a trade mark if the person uses the trade mark in relation to goods or services under the control of the owner of the trade mark.
(2) The use of a trade mark by an authorised user of the trade mark is an authorised useof the trade mark to the extent only that the user uses the trade mark under the control of the owner of the trade mark.
(3) If the owner of a trade mark exercises quality control over goods or services:
(a) dealt with or provided in the course of trade by another person; and
(b) in relation to which the trade mark is used
the other person is taken, for the purposes of subsection (1), to use the trade mark in relation to the goods or services under the control of the owner.
(4) If:
(a) a person deals with or provides, in the course of trade, goods or services in relation to which a trade mark is used; and
(b) the owner of the trade mark exercises financial control over the other person’s relevant trading activities;
the other person is taken, for the purposes of subsection (1), to use the trade mark in relation to the goods or services under the control of the owner.
(5) Subsections (3) and (4) do not limit the meaning of the expression under the control of in subsections (1) and (2).
It is evident that ‘control’ is a fundamental aspect of authorised use, with s 8(3) specifying ‘quality control’ and ‘financial control’ as non-exhaustive examples of the type of control required.
In Lodestar Anstalt v Campari America LLC Basenko J elaborated on the meaning of control in s 8:
The meaning of “under the control of” in s 8 is informed by the principle stated by Aickin J in Pioneer, that is to say, that the trade mark must indicate a connection in the course of trade with the registered owner. The connection may be slight, such as selection or quality control or control of the user in the sense in which a parent company controls a subsidiary…
I think control in s 8 means actual control in relation to the use of the trade mark and it means actual control in relation to the trade mark from time to time. I think (as the primary judge did) that that is the primary meaning of the word, and the English cases, so far as they go, support that conclusion. Control involves questions of fact and degree as does the notion of a sufficient connection. There must be control as a matter of substance.[3]
[3] [2016] FCAFC 92 [95].
The Removal Opponent asserts that it is part of a group of companies which includes Directed Electronics, and in these circumstances use of the Trade Mark by Directed Electronics indicates a connection in the course of trade with the Removal Opponent.
In regards to the relationship between STI Technologies and Directed Australia, Siolis 1 states:
STI Technologies (Holdings) Pty Ltd is part of the Directed group of companies, which includes Directed Electronics Australia Pty Ltd.
The Removal Opponent has provided ASIC extracts for STI Technologies and Directed Electronics. These extracts show that the two entities have the same registered office and principal place of business. The extracts also indicate that Stavros Siolis is the sole director of Directed Electronics however I note that he and Anthony Tselepis are the directors of STI Technologies.
On the information before me, it seems that there is a relationship between the Removal Opponent and Directed Electronics. However, it is not clear to me that the nature of the relationship is such that the Removal Opponent controls Directed Electronics in the sense that a parent company controls a subsidiary.
Siolis 2 states that the Removal Opponent’s intellectual property rights have been used under licence by Directed Electronics. Exhibit SS-13 consists of a Trade Mark Licence Agreement (‘Licence Agreement’) between the Removal Opponent and Directed Electronics. The Licence Agreement grants Directed Electronics the right to use trade marks owned by the Removal Opponent including the Trade Mark.
Importantly, the Licence Agreement is dated 19 May 2017 which is well after the Relevant Period. The Removal Opponent submits that the Licence Agreement formalises the arrangement that has been in place since 2007. This is supported by Recital C of the Licence Agreement which states:
DEA (Directed Electronics) was incorporated on 20 June 2007 and from approximately that date has been using the “DVS” mark with the consent and under the control of STI.
If I am to proceed on the basis that there was an informal licence agreement during the Relevant Period, the Removal Opponent must still show that they exercised actual control over Directed Electronics use of the Trade Mark during the Relevant Period.
The Removal Opponent has asserted that Directed Electronics use of the Trade Mark during the Relevant Period was under its control. However the Removal Opponent has not explained how it exercised control over Directed Electronics use of the Trade Mark, nor has the Removal Opponent described any activities that it undertook during the Relevant Period which would suggest that it exercised actual control from time to time, over use of the Trade Mark by Directed Electronics.
At this point, it is convenient to acknowledge that the Licence Agreement contains two provisions which appear to be quality control provisions.
Clause 4.4
Each Trade Mark shall be used and applied to the relevant Goods or in respect of the relevant Services in the manner prescribed in writing by STI from time to time.
Clause 4.7
STI may from time to time appoint a person to inspect any facility or method used for manufacturing and packaging of the Goods to which a Trade Mark is to be applied or the provisions of the Services in respect of which a Trade Mark is used.
The Removal Opponent is silent as to whether these quality control provisions were in place or performed during the Relevant Period. As such, I am unwilling to infer that the quality control provisions were included in the Licence Agreement because they reflect the quality control that was exercised by the Removal Opponent during the Relevant Period.
I am not satisfied that the Removal Opponent has established that Directed Electronics was an authorised user of the Trade Mark during the Relevant Period. As such the ground for removal under s 92(4)(b) of the Act has been made out.
Discretion
Even though the ground on which the removal application was made has been established, the Registrar has the discretion not to remove the Trade Mark from the Register.
Section 101 relevantly 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.
(4) Without limiting the matters the Registrar may take into account in deciding under subsection (3) not to remove a trade mark from the Register, the Registrar may take into account whether the trade mark has been used by its registered owner in respect of:
(a) similar goods or closely related services; or
(b) similar services or closely related goods;
to those to which the application relates.
In this matter, the question to be asked is whether it is reasonable not to remove the Trade Mark, even though the Trade Mark was not used by the registered owner, or an authorised user, during the Relevant Period.[4]
[4] Austin, Nichols & Co Inc v Lodestar Anstalt [2012] FCAFC 8 [28] (‘Austin’).
The Removal Opponent bears the onus of convincing the Registrar that it is reasonable not to remove the Trade Mark.[5]
[5] Optical 88 Ltd v Optical 88 Pty Ltd (No 2) [2010] FCA 1380 [273].
Section 101 confers a broad discretion upon the Registrar which ‘is limited only by the subject matter, scope and purpose of Part 9 of the Act’.[6] In Austin, the purpose of Part 9 of the Act was expressed as follows:
The purpose of Part 9 is to provide for the removal of unused trade marks from the Register. In that regard it is plainly designed to protect the integrity of the Register, and in this way, the interests of the consumer. At the same time, however, it seeks to accommodate, where reasonable, the interests of the registered trade mark owners.[7]
[6] Austin [35].
[7] Ibid [38].
A range of circumstances may be taken into account in exercising this discretion. The circumstances do not need to be exceptional, but they need to be sufficient to satisfy the Registrar that it is reasonable to exercise the discretion.[8]
[8] E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2008] FCA 1005 [198].
In Tivo Inc v Vivo International Corporation Pty Ltd Dodds-Streeton J summarised some relevant considerations for the exercise of the discretion:
In Austin, the Full Court affirmed that Flick J’s view that while public interest, particularly in the integrity of the Register, was the guiding principle behind the discretion, the private commercial interests of parties could be taken into account and the interests of both consumers and traders must be recognised (at [33]-[34]).
In E&J Gallo, Flick J identified (at [202]) the following factors additional to that in s 101(4) which, while not exhaustive, were also relevant to the exercise of the discretion: whether there has been no abandonment of the trade mark; whether the registered proprietor still had a residual reputation in the mark; whether there had been sales by the registered proprietor in relation to the goods for which removal was sought since the relevant period ended; whether 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; and whether the registered proprietors were aware of the applicants’ sales under the mark.[9]
[9] [2012] FCA 252 [467].
As already explained in this decision, there are deficiencies in the evidence such that the Removal Opponent has not been able to meet the specific requirements of s 92(4)(b) of the Act. Despite these deficiencies, the evidence demonstrates that this is not a case of an unused or abandoned trade mark cluttering the Register.
The evidence shows that the Trade Mark has been used before, during and after the Relevant Period by Directed Electronics, an entity related to the Removal Opponent. Mr Siolis, a director of both the Removal Opponent and Directed Electronics, declares that an informal licence has been in place since 2007 under which the Removal Opponent licensed use of the Trade Mark to Directed Electronics. As stated earlier in this decision, the existence of the informal licence is corroborated by Recital C of the Licence Agreement. The Licence Agreement evidences the Removal Opponent’s intention for this commercial arrangement to continue.
The Licence Agreement is in relation to all of the goods for which the Trade Mark is registered for. However, the evidence before me does not show use of the Trade Mark in relation to all of the goods. The evidence of use, both before, during and after the Relevant Period, shows use in relation to the following goods:
Roof mounted screen and DVD loader, USB and SD reader, built in FM transmitter and headphones;
Headrest kit including monitors, FM MOD, Dual DVD, IR headphones, poles, games discs, wireless remote and zip up covers;
Digital mobile TV tuner; and
Wireless headphones.
Considering all of the circumstances, I am satisfied that it is reasonable not to remove the Trade Mark in respect of the above goods, goods which are similar or likely to be sold in conjunction with them. Consequently, I consider it is reasonable to exercise the Registrar’s discretion to allow the Trade Mark to remain registered for the following goods:
Class 9: Audio apparatus for vehicles; audio electrical apparatus for in-car entertainment; car audio apparatus; electrical apparatus for fitting to vehicles to display visual information; video apparatus; audio products for use in vehicles; portable media players; liquid crystal display (LCD) televisions; display monitors; monitors; video devices; electronic and recorded multimedia publications; multimedia multiplexers.
Class 12: Interior fittings (trim) for vehicles being headrests, zip up covers for headrests and interchangeable posts for headrests.With respect to the goods in class 12, the advertisements in Siolis 1 clearly indicate that the headrest kit includes ‘zip up covers’ for the headrests and ‘interchangeable posts to fit most vehicle fittings’ which I take to be the posts which allow the headrest to be joined/secured to the seat. Some of the advertisements also suggest that the headrest kit includes the ‘headrest’ itself. It is on this basis that I have allowed the Trade Mark to remain registered in respect of the claim in class 12 for interior fittings (trim) for vehicles being headrests, zip up covers for headrests and interchangeable posts for headrests.
Decision
The application for removal under s 92(4)(b) of the Act has been successful. However, I am satisfied that it is reasonable to exercise the Registrar’s discretion and not remove the Trade Mark from the Register in respect of the goods set out at [55] of this decision, noting the refinement in class 12 to: Interior fittings (trim) for vehicles being headrests, zip up covers for headrests and interchangeable posts for headrests.
Therefore I direct that registration number 1369862 be partially removed from the Registrar of Trade Marks one month from the date of this decision, in respect of the following goods:
Class 9: Frequency converters.
Class 12: Car body modification parts for sale in kit form; car body parts made of plastic materials; interior panels for vehicles; linings for vehicles; security systems for vehicles (other than locks); vehicle ride control devices; vehicle windows incorporating aerials for radio reception.
If the Registrar is served with a notice of appeal within the relevant timeframe, the registration will be subject to the decision made by the court.
Costs
As both parties were, strictly speaking, partly successful I believe it appropriate in this case that each party bears its own costs.
Katrina Brown
Hearing Officer
Trade Mark Oppositions & Hearings
17 April 2018
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