SwissEnergy Pharma GmbH v Swisse Wellness Pty Ltd

[2023] ATMO 37

TRADE MARKS ACT 1995

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

Re:Request by Swisse Wellness Pty Ltd for an extension of time to file evidence in reply in the opposition by Swisse Wellness Pty Ltd to extension of protection to international registration designating Australia 2025599 (International Registration No. 1404630) (classes 3, 5, 29, 30, 32) – SWISS ENERGY BY DR. FREI (Fancy) – held by SwissEnergy Pharma GmbH.

Delegate:	Bianca Irgang
Representation:	Opponent: David Larish of counsel instructed by King & Wood Mallesons Holder: Stephen Rebikoff of counsel instructed by Davies Collison Cave Pty Ltd
Decision:	2023 ATMO 37 Application under regulation 17A.34K of the Trade Marks Regulations 1995 (Cth) for an extension of time to file evidence in reply– grounds for extension of time under regulation 17A.34K(2)(a) and (b) considered – no grounds established – application for extension of time refused. Application under regulations 21.15(4)/21.19(1) for material to be considered by the Registrar – granted. No award of costs.

Background

1. This decision concerns an application made by Swisse Wellness Pty Ltd  (‘Opponent’) for an Extension of Time (‘EOT’) to file the balance of the Evidence in Reply (‘EIR’) in support of the opposition to extension of protection to international registration designating Australia under number 2025599 (International Registration No. 1404630) is set out below:

Application Number:

2025599  

Filing Date:

7 June 2019

Goods and Services:

Class 3: Cosmetics; cosmetics for children; dentifrices; all the goods are from Switzerland.

Class 5: Medicines; medicinal alcoholic beverages; diabetic supplements; medicinal lotions and creams for dermatological use; fungicides; pharmaceutical preparations for treatment of sexual dysfunction; all the goods are from Switzerland.

Class 29: Fruit-based food preparations intended for athletes; all the goods are from Switzerland.

Class 30: Tea; all the goods are from Switzerland.

Class 32: Energy drinks; waters (beverages); all the goods are from Switzerland.

Trade Mark:

(‘Trade Mark’)

1. Unless otherwise indicated, any references to sections or regulations in this decision are references to sections or regulations of the Trade Marks Act 1995 (Cth) (‘Act’) or the Trade Marks Regulations 1995 (Cth) (‘Regulations’), respectively.

2. Pursuant to Regulation 17A.34J(6) EIR was to be filed by the Opponent by 1 September 2022. On 1 September 2022, the Opponent filed the declaration of Nick Mann and the declaration of Molly Flynn. The Opponent also sought an EOT of two weeks within which to file the balance of their EIR.  The basis of this application was that the parent company of the Opponent’s the H&H Group which is headquartered in Hong Kong and has continued to be severely impacted by the “zero-covid strategy” being one of the world’s most stringent COVID-19 restrictions.  According to the Opponent, Liza Zhou, China Legal Director of the H&H Group based in Guangzhou, China, resigned around August 2022. Ms Zhou had carriage of this matter on behalf of the Opponent until her resignation. The H&H Group had to appoint a new Group Legal Director and brief a new appointee on the opposition.

3. Further to this, the Opponent advised they engaged a marketing expert to provide expert evidence in opposition and that the Opponent’s marketing expert had only recently returned from a period of leave which delayed the compilation of the Opponent’s expert evidence.

4. Subsequently, the expert evidence was filed on 15 September 2022 (‘the Blanket declaration’).

5. A delegate of the Registrar of Trade Marks (‘Registrar’) wrote to the Opponent on 15 September 2022 indicating that the Registrar intended to grant the extension to 15 September 2022.  A copy of the Request and the delegate’s letter were sent to SwissEnergy Pharma GmbH (‘the Holder’) at the same time.

6. The Holder wrote to the Registrar and requested a hearing on the matter of the EOT stating that the EOT should be refused.

7. This office issued formal hearing notices to both parties setting the EOT to be heard on 23 February 2023, and I issued directions to the parties to file any additional submissions prior to hearing.

8. The Holder filed additional written submissions on 16 February 2023.  In considering the EOT I have had regard to each of the materials on the file set out in the paragraphs above.

   The Opponent’s Evidence and Submissions

9. The Opponent has not filed any sworn evidence in support of the request, rather relies on statements made in the EOT application and in its submission for the hearing.  In the EOT application the Opponent attributes the delay in filing its evidence to the Opponent’s China-based Legal Director resigning around August 2022 and having to brief a new appointee on the opposition. This, coupled with China’s zero-covid strategy, is the overall situation which resulted in the delay in finalising its EIR.

10. I note that the Opponent’s evidence is entirely unsworn and no material is annexed providing any support to the claims of exactly when the Opponent’s Legal Director resigned, any issues with briefing a new appointee on the opposition and how China’s zero-covid strategy had a material impact on the opposition. I would expect that documents evidencing the resignation, the engagement and briefing of a new appointee to the position and office closures without remote access due to China’s zero-covid strategy would be within the power of the Opponent to provide.

    The extension of time provision

11. Regulation 17A.34K is reproduced in full below. 

    17A.34K  Extension of time for filing

    (1)  A party may request the Registrar to extend a period for filing evidence mentioned in regulation 17A.34J.

    (2)  The Registrar may extend the period only if the Registrar is satisfied that:

    (a)  the party:

    (i)  has made all reasonable efforts to comply with all relevant filing requirements of this Subdivision; and

    (ii)  despite acting promptly and diligently at all times to ensure the filing of the evidence within the period, is unable to do so; or

    (b)  there are exceptional circumstances that justify the extension.

    (3)  The Registrar:

    (a)  must decide the length of the extended period having regard to what is reasonable in the circumstances; and

    (b)  may do so on terms that the Registrar considers appropriate.

    (4)  In this regulation:

    exceptional circumstances includes the following:

    (a)  a circumstance beyond the control of a party that prevents the party from complying with a filing requirement under this Subdivision;

    (b)  an error or omission by the Registrar or an employee that prevents a party from complying with a filing requirement under this Subdivision;

    (c)  an order of a court or a direction by the Registrar that the opposition be stayed.

12. Sub-regulation (2) provides two alternative grounds.  I must first be satisfied that at least one of those grounds has been established before my discretions to grant an extension of time, and the length of the extended period, are enlivened.  The Opponent bears the onus to satisfy the Registrar that the criteria in regulation 17A.34K(2)(a) or (b) have been met. This is an onerous test in line with regulation 5.15[1]. The Opponent has not argued for the EOT under Regulation 17A.34K(2)(a), however, for the sake of completeness and to demonstrate all the surrounding circumstances of the case I will discuss it.

    Regulation 17A.34K(2)(a) – Reasonable, prompt and diligent

    [1] Fonterra Co-Operative Group Ltd v Meiji Dairies Corporation [2014] APO 11, [10] (Delegate Dr S.D. Barker).

13. Regulation 17A.34K(2)(a) sets out two requirements. These are that a party “has made all reasonable efforts to comply with all relevant filing requirements of this subdivision” and “despite acting promptly and diligently at all times to ensure the filing of the evidence within the period, is unable to do so.” In Julie-Anne McCarthy and Bradley McCarthy v TRED Design Pty Ltd (‘TRED Design’), a delegate for the Commissioner of Patents relevantly explained identical requirements under the Patent Regulations 1991 (Cth):

    While the two legs are similar, the "reasonable" leg relates to "all relevant filing requirements", whereas the "promptly and diligently" leg relates to the period for filing "the appropriate evidence". Reasonableness appears to relate to conduct over the whole of the opposition, and not just the current evidence stage. I would expect that often where a person has acted reasonably, they will also have acted promptly and diligently (an exception might be where a person was diligently preparing evidence that was unnecessary for the opposition). The question posed by the regulation is whether the person seeking the extension satisfies each leg of the test. Where they fail to satisfy one of the legs, then an extension will not be available (in the absence of exceptional circumstances).[2]

    [2] [2013] APO 57, [28] (Delegate Dr S.D. Barker).

14. For this regulation to be established I must consider the Opponent’s conduct over the course of the whole opposition. The Opponent has not provided sufficient details of the staffing turnover difficulties that impacted on its ability to file the EIR in a timely manner. Nor has it established a consistent pattern of reasonable effort, promptness and diligence in relation to is efforts to file the balance of the EIR within the statutory timeframe including providing a timeline of the steps taken by the Opponent to prepare the EIR and how the staffing turnover issue or the of zero-covid strategy in China impacted on that timeline. 

15. To determine whether a party has acted promptly and diligently at all times requires an analysis of the chronology of events over the period of time provided to file the EIR.  In so analysing, it is not necessary for every minute of every day to be accounted for, though enough information should be provided to enable me to form an opinion on whether the Opponent ‘has acted reasonably, promptly and diligently.’[3] The delegate in TRED Design gave as an example (at [76]):

    The kind of information that could be provided is a brief account of actions taken (for instance, an outline of what was done, when it was done, how it was done, by whom it was done, as appropriate to the case) covering the period in question.

    [3] Ibid, [76].

16. No such evidence has been provided by the Opponent nor has the Opponent argued this regulation.  In the absence of any such evidence or argument, I am not satisfied that the Opponent has acted promptly and diligently at all times. Therefore, the ground for granting the EOT found in regulation 17A.34K(2)(a) has not been established.

    Regulation 17A.34K(2)(b) – Exceptional Circumstances

17. Regulation 17A.34K(4) states that the term exceptional circumstances includes three categories of events.  As the Opponent has not alleged an error or omission by the Registrar or an order of the court, this EOT only considers whether the Opponent has established that it has suffered a circumstance beyond its control that prevented it from complying with its filing requirements.

18. The issue in the present case is a matter of fact; namely that the burden is on the Opponent to establish that the circumstance existed and that the particular circumstance prevented it from complying with its filing requirements. The Opponent has pointed out that there is no requirement under regulation 17A.34K(2)(b) for the Opponent to have acted promptly and diligently at all times and that the Opponent only needs to establish the general meaning of ‘exceptional circumstances’ that prevented it from filing its evidence by the due date. However, while the two regulations are separate, regulation 17A.34K(2)(b) is not an easier regulation to satisfy. Nor does it permit the Opponent to have acted in a less than diligent or prompt manner through the course of the opposition until an exceptional circumstance prevented it from filing its evidence. The ‘exceptional circumstances’ listed in regulation 17A.34K(2)(b) are not a catch all for inconveniences endured during the filing of the evidence. The ‘exceptional circumstances’ referred to are more than usual or foreseeable business inconveniences.

19. The Opponent has submitted no sworn evidence on this point, relying on the unsworn statement in the EOT application and the submissions for hearing. It has adduced no documentary evidence demonstrating that the claimed resignation and briefing of a new appointee combined with China’s zero-covd strategy caused the delay in filing the balance of its EIR. The Opponent has asserted that these issues significantly impacted on its preparation of evidence as they are the reasons why the Blanket declaration was filed late stating:

    The circumstance(s) under reg 17A.34K(4)(a) were that the lawyer Liza Zhou, who had “carriage of this matter on behalf of the Opponent”, resigned the month before the Opponent’s evidence in answer was due, such that time was required to appoint a new Group Legal Director and brief them on the opposition. This unfortunately occurred while the H&H Group was experiencing “ongoing disruptive effects” of the epidemic prevention policy in China. Those factors, combined, were beyond the Opponent’s control.

    Put in terms of the ordinary meaning of “exceptional circumstances”, in the context of a business hampered by the epidemic prevention policy, the timing of the resignation meant that the new Group Legal Director had very little time to get up to speed on the opposition; combined with the fact that nobody else on behalf of the H&H Group was across the detail of the opposition, this was unusual or out of the ordinary.

20. These circumstances require discussion. The ‘ongoing disruptive effects’ being the epidemic prevention policy in China is of limited value in these circumstances. This is because the Opponent has provided no details of how this policy directly impacted on the filing of the EIR or how, after years of this zero-covid policy being in effect, the business was caught by surprise by these developments and had no contingency plans in place during the filing of the EIR.

21. The Opponent has provided no timeline for the preparation of evidence indicating exactly how the supposed exceptional circumstance had prevented it from complying with the filing requirements.  The expert was only briefed to provide evidence two days before the due date for EIR and was on leave at an unspecified time and duration. There is limited detail on why the expert was briefed so late in the evidence stage, when the expert was on leave and whether or not other experts could have been briefed to provide the same service.

22. An application for an EOT is a significant application and the burden is on an applicant for an extension to substantiate the facts relied upon for such an extension.  The Opponent has failed to substantiate, as a matter of fact, that it has suffered an exceptional circumstance beyond its control that prevented it from complying with its filing requirements.

23. For the reasons give above, I am not satisfied that an EOT should be granted under regulation 17A.34K(2)(b).

    Regulations 21.15(4) and 21.19(1)

24. The Opponent has argued that if the EOT should not be granted that it is appropriate for the discretion to be exercised under regulations 21.15(4)/21.19(1) by the Registrar to allow the Blanket declaration to be considered in these proceedings. The Opponent relies on the following matters:

    First, the nature of the amendment sought, and the Opponent’s conduct, militate in favour of the exercise of the discretion. In particular:

    (a) The extension sought is a short one: it is only 14 days.

    (b) The Registrar and the Applicant were on notice of the need and reason for the extension in advance of the filing deadline.

    (c) The evidence has been filed and is immediately available to the Registrar and the Applicant: cf Fed Square Pty Ltd v Federation IP Pty Ltd (2015) 113 IPR 453 at [51], [52].

    (d) The Opponent’s other evidence in reply was filed by the deadline notwithstanding the difficulties faced by the Opponent.

    Secondly, the Blanket Report is of substantial importance.

    …

    Thirdly, the public interest favours exercising the discretion.

    …

    Fourthly, although it would be a surprise if the Applicant chose to do so, the Opponent does not object to the Applicant seeking to file evidence responsive to the Blanket Report.

25. These are interesting points put forward by the Opponent. In particular, I note the probative value of the Blanket declaration. The Blanket declaration involves objective expert evidence in response to the Holder’s Cavin Declaration which is in its evidence in answer. The Opponent asserts that without the Blanket declaration the Opponent will not have any evidence that is responsive to these aspects of the Cavin Declaration.

26. I note that the Opponent filed the Blanket declaration on 15 September 2022 and that it was two weeks after the deadline for the EIR. However, the Holder has now had the Blanket declaration in its possession for some five months while waiting for the hearing on this EOT matter that it instigated. This five months has been a significant delay to proceedings and a significant amount of time for the Holder to have the Blanket declaration in its possession.

27. Under these circumstances I am reminded of the comments the Opponent drew my attention to in Seven Network (Operations) Ltd v Giorgio Armani SPA, Milan, Swiss Branch Mendrisio [2013] ATMO 70 at [16] (quoted with approval in Fed Square at [48]):

    “It is clearly desirable that unnecessarily protracted opposition proceedings be curtailed by these recent changes to our legislation. However, the important principle that 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, has not been diminished by these changes. It cannot but remain a potent factor to be weighed into the balance whenever a delegate exercises discretion under the legislation that has the potential to exclude evidence critical to an opposition outcome.”

28. While it is very unusual to refuse an application for an EOT and then allow the material to still be considered in the proceedings under the provisions of regulations 21.15(4) and 21.19(1), I am satisfied that the entirety of the circumstances of this particular case warrant it. The Opponent was unable to satisfy the requirements for the grant of an EOT but the public interest, the time the Holder has had access to the Blanket declaration and the probative value of the Blanket evidence satisfies me that the best course of action is for the Registrar to have access to the material when making the decision on the substantive issue. I am allowing the Blanket declaration into the evidence.

    Decision

29. I am not satisfied that there are exceptional circumstances that justify extending the period in which the Opponent may file EIR.  

30. Accordingly, I refuse to grant the EOT. As a consequence, the period for filing EIR ended on 1 September 2022 and the material filed after that date does not constitute EIR.

31. However, the Blanket declaration is allowed in under the provisions of regs 21.15(4) and 21.19(1). I am allowing the Holder one month from the date of this decision in which to provide material in response to the Blanket declaration.

32. The Opponent has sought orders as to costs but was not successful in its request for an EOT in which to file the balance of its EIR. However, the Opponent has been successful in its application to have the Blanket declaration considered as additional information by the Registrar’s discretion. Therefore, as both parties have been successful in their arguments to some extent I make no award of costs.

    Bianca Irgang

    Hearing Officer

    Trade Marks Hearings

    21 March 2023