Telstra Corporation Limited v Phone Directories Company Australia Pty Ltd - [2010] ATMO 37

TRADE MARKS ACT 1995

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

Re:Opposition by Telstra Corporation Limited to registration of trade mark application 1135497(16, 35) - LOCAL DIRECTORIES YOUR LOCAL PHONE BOOK - filed in the name of Phone Directories Company Australia Pty Ltd.

Delegate:

Iain Thompson

Representation:

Opponent: Siobhan Ryan of Counsel instructed by Sally Foreman of Davies Collison Cave

Applicant: Chris Round, Solicitor of Middletons

Decision:

2010 ATMO 37

S52 opposition: s41 – the question under subs 41(3) to be tested by reference to the intrinsic nature or denotation of the trade mark itself and not whether other traders are innocently using the trade mark in the normal course of trade; subsection 41(6) - trade mark not used by applicant; registration refused.

Costs awarded against applicant.

Background

In this matter Phone Directories Company Australia Pty Ltd of Robina, Queensland (‘the applicant’) has applied to register a trade mark, current details of which appear below:

Application No: 1135497

Priority Date: 14 September 2006

Goods/Services: Class: 16 Printed publications and annual private, professional and commercial telephone, locality and street directories
Class: 35 Advertising; advertising services relating to the provision and promotion of telephone directories and telephone directory business supplements of all kinds (including directories and business supplements provided to users in tangible or intangible form and those held in magnetic, electronic, electro-optic or other media) including agency services in respect of such directories and business supplements; advertising services in any media promoting the services and goods of advertisers in such directories and business supplements; advertising survey services, including telephonic and electronic surveys relating to telephone directories and telephone directory business supplements; co-operative advertising with those who advertise in telephone directories and telephone directory business supplements; advertising services and business services relating to the effective use of advertising services provided via the Internet including the compilation of advertisements for use on the Internet

Trade Mark: Local directories your local phonebook

(‘the opposed trade mark’)

Endorsements: Provisions of subsection 41(5) applied.

Provisions of paragraph 44(3)(b) applied.
(‘the application’)

The first endorsement, above, reflects grounds for rejection found during the examination of the application and evidence presented by the applicant to the examiner in resolution of that ground. The second endorsement reflects a conflicting trade mark – 1088135 (Australian Local directories your local phonebook Logoform) – which was, at that time, registered in the name of Australian Local Directories Pty Ltd but which was assigned to the applicant on 1 July 2009.
The application was advertised for possible registration on 31 January 2008. On 30 April 2008, Telstra Corporation Limited of Melbourne, Victoria (‘the opponent’) filed Notice of Opposition (‘the Notice’) to the registration of the trade mark.
The Notice includes most grounds available under the Trade Marks Act 1995 (‘the Act’).
As a delegate of the Registrar of Trade Marks, I heard the submissions of the parties at a hearing in Melbourne on 14 April 2010. The applicant was represented by Mr Chris Round of Middletons and the opponent was represented by Siobhan Ryan of Counsel instructed by Sally Foreman of Davies Collison Cave.
I believe an accurate summation of the opponent’s position is that the main thrust of its submissions go to section 41 of the Act – accordingly, my discussion of the evidence and emphasis elsewhere in this decision will accordingly reflect that ground.

The Evidence

The parties have served and filed the following evidence:

Declaration:	Position:	Date made:
Evidence in support
Christopher James Doody	Regional Marketing Manager - Telstra Country Wide	30 May 2008
Stephen Thomas Harvy (‘Harvy 1’)	Group Marketing Manager - Yellow Pages® Sensis Pty Ltd	6 June 2008
Stephen Thomas Harvy (‘Harvy 2’)	Group Marketing Manager - Yellow Pages® Sensis Pty Ltd	23 December 2008
Evidence in Answer
Catherine Rose McGarry	General Manager of the Applicant and of Phone Directories Company Pty Ltd	25 May 2009
Evidence in reply
Stephen Thomas Harvy (‘Harvy 3’)	Group Marketing Manager - Yellow Pages® Sensis Pty Ltd	26 August 2009
Sally Erica Foreman	Senior Associate – Davies Collison Cave	7 April 2010

Mr Doody’s declaration attests to the use and application for registration of the opponent’s ASK A LOCAL trade mark (application number 1034104). I note that this ASK A LOCAL trade mark application was withdrawn and a divisional filed under 1136210 – the divisional has been accepted for possible registration and opposed by the applicant in these proceedings. Details of the opponent’s ASK A LOCAL divisional application are:

Application No: 1136210

Priority Date: 13 December 2004

Goods/Services: Class: 38 Telecommunication of information (including web pages), computer programmes and any other data; information services related to telecommunications; transmission of information on a wide range of topics, including on-line transmission.
Class: 42 Research services

Trade Mark: ASK A LOCAL

Mr Doody states that the ASK A LOCAL trade mark was first used by the opponent in 2004 during an advertising campaign in Newcastle which was associated with a sporting team known as the New Castle Knights and offered broadband access and a number of free local phone calls. This campaign was extended in the years 2004, 2005 and 2006 in the Newcastle region. Mr Doody says that the ASK A LOCAL trade mark was used on correspondence, point of sale materials, local marketing brochures, television advertisements, radio advertisements, outdoor advertisements, online, in press, in stadium advertising and on “ilites”[1] and “tabletop advertisements”.
[1] I am not certain what ‘ilites’ are but these could be the ‘metrolites’ referred to elsewhere in the declaration. ‘Metrolite’ does not appear to be a dictionary word.
A similar campaign was run under the ASK A LOCAL trade mark by the opponent in association with the Penrith Panthers sporting team and ran from February or March 2005 until March 2006 – during this campaign the ASK A LOCAL trade mark was used on point of sale materials, in press (including featuring in the Penrith Press, Hawkesbury Courier and Blue Mountains Gazette), outdoor advertising (including advertising on the back of buses and at railway stations), in association with a competition for $20 mobile phone plan for a chance to win a free Panthers jerseys and on “metrolites” and “table tops”.
In March 2006 the ASK A LOCAL trade mark featured on the front of the Penrith Panthers publication, Volume 20, No. 2, a publication of Panthers Entertainment Group. The publication, which is in evidence, claims to have a circulation of 130,000 people and 260,000 readers.
Mr Doody says that the ASK A LOCAL trade mark has been used on internal materials by the opponent and in these additional public ways, examples of which are exhibited to his declaration:
·     in mail outs, including a mail out in 2006/2007 to approximately 20,000 recipients in Western Australia including Mount Helena, Ravensthorpe, Leinster, Norseman, Munchea and Wundowie;
·     on the applicant’s t-shirts; and,
·     in a brochure produced for North and North West Queensland.
Mr Doody also exhibits examples of the opponent’s use of the tag line “LOCAL PEOPLE, LOCAL KNOWLEDGE, LOCAL SOLUTIONS” which appeared in a number of its advertising and promotional materials in the South Region and in the Northern Territory from about 2000.
Mr Doody says that the opponent has expended in excess of one million on advertising and promoting goods and services provided under the ASK A LOCAL trade mark since its inception up to 2007.
Sales under the ASK A LOCAL trade mark were several million.[2]
[2] It is not clear to me whether the figures provided in relation to the ASK A LOCAL trade mark are confidential.
Mr Harvy, in his first declaration, states that the opponent has been producing and distributing its Yellow Pages® directories branded with the word LOCAL on the covers since at least 1997 when the phrase “All the local answers” appeared on the covers. The declarant states, “From at least 1999, Telstra’s local directories were referred to as Yellow Pages® local directories, and this phrase appeared on their covers. The word LOCAL has been used by Telstra continuously on the Yellow Pages® local directories since 1997.” He continues, “Following the rebranding in 1993/1994, the Yellow Pages® local directories became a growing segment of the Yellow Pages® product portfolio.” These generated a two fold increase in revenues between 1994 and 1997. Confidential figures are supplied by Mr Harvy which show that the increase in both distribution of the directories and revenues was substantial.
Mr Harvy says that the opponent has used the following expressions, which included the word LOCAL, in advertising and promoting its directories business in the years since 1997:
·     YOUR YELLOW PAGES LOCAL DIRECTORY;
·     YOUR LOCAL YELLOW PAGES/DIRECTORY;
·     YOUR LOCAL DIRECTORY;
·     YOUR LOCAL DIRECTORY HAS ARRIVED;
·     THERE IS A BETTER WAY TO FIND YOUR LOCAL CUSTOMERS;
·     YOUR NEW (AND IMPROVED) YELLOW PAGES LOCAL DIRECTORY;
·     EXPECT MORE LOCALS TO POP IN (OR POP UP) / EXPECT MORE LOCAL BUYERS TO POP UP;
·     THE LOCAL YELLOW PAGES DIRECTORY
·     NEED IT LOCALLY;
·     EASTERN SUBURBS YELLOW PAGES LOCAL DIRECTORY;
·     GET TO KNOW YOUR LOCALS; (1) MEET THE LOCALS;
·     YELLOW PAGES LOCAL - SORTED;
·     THE LOCAL IS CLOSING
·     ADVERTISE IN YOUR LOCAL YELLOW PAGES DIRECTORY ... AND THE LOCALS WILL FIND YOU;
·     LOCAL MAPS, LOCAL INFORMATION, LOCAL BUSINESSES, LOCAL PRODUCTS (or similar variations);
·     YELLOW PAGES LOCAL;
·     IMPROVE YOUR LOCAL BUSINESS LANDSCAPE;
·     TARGET PEOPLE LOOKING TO SHOP LOCALLY;
·     YELLOW LOCAL;
·     YOUR LOCAL IS NOW OPEN FOR BUSINESS;
·     DISCOVERING YOUR LOCAL COMMUNITY;
·     YOUR LOCAL SHOPPING CENTRE or LOCAL SHOPPING CENTRE;
·     LOCAL DIRECTORY;
·     THE LOCAL KNOW-IT ALL;
·     LAST CALL AT YOUR LOCAL;
·     LAST CHANCE TO GET IN WITH THE LOCALS; and
·     YOUR LOCAL AREA
Ms McGarry’s declaration of 25 May 2009 serves primarily to bring into evidence (and supplement) her declaration of 21 December 2007 which was filed by the applicant to address the examiner’s objections under subsection 41(5) during examination of the application. I am not assisted by the fact that, at paragraph 2 of the earlier declaration, Ms McGarry claims confidentiality for the earlier declaration in its entirety. At one level the easy solution is to comply with Ms McGarry’s wishes and to exclude the earlier declaration from any consideration. However, I proceed under the assumption that, since it is served and filed in answer to the opponent’s evidence, I must be expected to discuss the declaration in some detail except for discussion of potentially confidential business material such as circulation figures for phone books, turnover, etc.
Ms McGarry explains, in her earlier declaration, that the applicant’s directory publications include an A—Z directory listing of both business and residential phone numbers, and a classified advertisements section, all pertaining to a specific regional territory. Street directories and other government and community information pertaining to the relevant territory are included in the publications.
According to Ms McGarry’s evidence, in 1993 the applicant began selling advertising in its printed regional telephone directories. In 2005, the applicant has also sold advertising space in its online version of its phone book.
Ms McGarry says that directory publications have been delivered annually to every household, business and government agency with additional extra copies made available, for a specified period, at promoted pick-up points.
·     Since 1994 - PDC has distributed directory publications in Cairns, Townsville, Mt Isa, Rockhampton, Mackay, Sunshine Coast, Darwin and Alice Springs regions.
·     Since 2004 - PDC has distributed directory publications in Coffs Harbour, Port Macquarie, Taree and Foster Tuncurry regions.
·     Since 2007 - PDC has distributed directory publications in the Northern Rivers and Port Stephens regions of New South Wales.
Ms McGarry further affirms that in 2001 the applicant began using the expression YOUR LOCAL PHONE BOOK as a trade mark. At the time, this slogan was (Ms McGarry says) used in conjunction with the “well-known” PDC DIRECTORIES logo that had been used by the applicant for approximately 7 years. Ms McGarry does not specify what this PDC logo is.
I believe that it is possible that Ms McGarry refers to either of the trade marks which appear below which appear on the 1990s directories of the applicant:

Ms McGarry states that the applicant started using the phrase Your Local Phone Book as a trade mark in 2001. I reproduce a copy of the lower portion of the applicant’s 2004/2005 Alice Springs phone book:

Ms McGarry goes on to says that, in 2004, the applicant decided to update its branding – the result was the trade mark which appears below on 2005 directories:

In a further iteration of the trade mark, the letters PDC, which appear over the banner, LOCAL DIRECTORIES, were dropped from the above, sometime (I would gauge from the evidence) in 2006. The use, however, of the above graphical elements by the applicant has been quite inconsistent in the examples in evidence, with the words Your local phone book appearing above the words LOCAL DIRECTORIES in some directories, or the name of the particular town or district being inserted where the letters PDC appear. The horizontal lines which break up the above graphical elements also appear in some iterations of the above and not in others.
A version of the latter trade mark has also been registered. Details of this registration are:

Registration No: 1088135

Priority Date: 30 November 2005

Goods/Services: Class: 35 Advertising; advertising services relating to the provision and promotion of telephone directories and telephone directory business supplements of all kinds (including directories and business supplements provided to users in tangible or intangible form and those held in magnetic, electronic, electro optic or other media) including agency services in respect of such directories and business supplements; advertising services in any media promoting the services and goods of advertisers in such directories and business supplements; advertising survey services, including telephonic and electronic surveys, relating to telephone directories and telephone directory business supplements; co-operative advertising with those who advertise in telephone directories and telephone directory business supplements; advertising services and business services relating to the effective use of advertising services provided via the internet including the compilation of advertisements for use on the Internet

Trade Mark:

Endorsement: Provisions of subsection 41(5) applied.

Ms McGarry also refers me to the applicant’s website of 2006 – yourlocalphonebook.com.au. The creation of that website is both contemporaneous with the filing of the application and, in fact, the website no longer exists – my experience shows that visitors who attempt to access that site are redirected to the applicant’s current website at localdirectories.com.au.
The balance of the applicant’s evidence goes to the use, or intended use, of the trade mark after the priority date - 14 September 2006. However, I note that the most common appearance of the opposed trade mark after the priority date is within the trade mark with the following format, with variations in minor details:
The Harvy 3 declaration is an update on the opponent’s use of the word LOCAL in relation to its goods and services. For reasons which will become apparent, it is not necessary to my decision to discuss this evidence.
The Foreman declaration addresses formality issues relating to two earlier declarations.

Section 41

Section 41 of the Act provides:
Trade mark not distinguishing applicant’s goods or services
41.(1) For the purposes of this section, the use of a trade mark by a predecessor in title of an applicant for the registration of the trade mark is taken to be a use of the trade mark by the applicant.
Note 1: For applicant and predecessor in title see section 6.
Note 2: If a predecessor in title had authorised another person to use the trade mark, any authorised use of the trade mark by the other person is taken to be a use of the trade mark by the predecessor in title (see subsection 7(3) and section 8).
(2) An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (designated goods or services) from the goods or services of other persons.
Note: For goods of a person and services of a person see section 6.
(3) In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.
(4) Then, if the Registrar is still unable to decide the question, the following provisions apply.
(5) If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:
(a) the Registrar is to consider whether, because of the combined effect of the following:
(i) the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;
(ii) the use, or intended use, of the trade mark by the applicant;
(iii) any other circumstances;
the trade mark does or will distinguish the designated goods or services as being those of the applicant; and
(b) if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons; and
(c) if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken not to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons.
Note 1: For goods of a person and services of a person see section 6.
Note 2: Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).
(6) If the Registrar finds that the trade mark is not inherently adapted to distinguish the designated goods or services from the goods or services of other persons, the following provisions apply:
(a) if the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant—the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other persons;
(b) in any other case—the trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons.
Note 1: Trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate:
(a) the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; or
(b) the time of production of goods or of the rendering of services.
Note 2: Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).

As I understand Ms Ryan’s argument, the nub is that the opposed trade mark lacks any inherent adaptation to distinguish and should be refused registration in terms of subsection 41(6) but that, if it does have any adaptation to distinguish, it could only be because of the word ‘local’ and that because of the opponent’s extensive use of the word ‘local’ the applicant’s use of the opposed trade mark would deceive or confuse in terms of sections 44 or 60.
The applicant argues that the opposed trade mark is capable of distinguishing in terms of subsection 41(2) but, if I find otherwise, should be (because of its use or intended use) registrable in terms of subsection 41(5).
The scheme and operation of section 41 were discussed by Branson J in Blount Inc v Registrar of Trade Marks [1998] FCA 440 where she said:
Subsections (3) to (6) of s 41 of the Act are designed to control the process by which the Registrar is to reach a conclusion as to whether the trade mark for which registration is sought is capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (“the designated goods or services”). If the trade mark is not so capable, the application for its registration must be rejected (s 41(2)). Subsection (3) requires the Registrar first to “take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons”. Having taken such matter into account, it is theoretically open to the Registrar to conclude:
(a) that the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons and capable, on that basis alone, of so distinguishing the designated goods or services; or
(b) that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons; or
(c) that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, but there is uncertainty, on that basis alone, that the trade mark is actually capable of so distinguishing the designated goods or services.
The structure of s 41 of the Act dictates that if the Registrar reaches conclusion (a) above, then he or she will decide the question whether or not the trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons by reaching the answer that it is so capable by reason of its inherent adaptability to distinguish (s 41(2) and (3)). The Registrar will, in such circumstances, be required, by reason of the terms of s 33(1) of the Act, to accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application.
If the Registrar reaches conclusion (b) or (c) above, he or she is, within the meaning of s 41(4) “unable to decide the question”. That is, he or she is unable, simply by taking into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services, to answer the question whether or not the trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons.
If the Registrar reaches conclusion (b) above, then the provisions of paragraphs (a) and (b) of s 41(6) are brought into operation. If the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date of the application, the trade mark does distinguish the designated goods or services as being those of the applicant, the Registrar will not reject the application pursuant to s 41(2). The Registrar will, in such circumstances, accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application (s 33(1)). If the applicant fails to establish that because of the extent to which the applicant has used the trade mark before the filing date of the application, the trade mark does distinguish the designated goods or services as being those of the applicant, the Registrar must reject the application pursuant to s 41(2).
If the Registrar reaches conclusion (c) above, then the provisions of paragraphs (a), (b) and (c) of s 41(5) are brought into operation. If the Registrar, having considered the combined effect of the matters listed in subparagraphs (i), (ii) and (iii) of s 41(5)(a), is satisfied that the trade mark does or will distinguish the designated goods or services as being those of the applicant, he or she will not reject the application pursuant to s 41(2). The Registrar will, in such circumstances, accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application (s 33(1)). If the Registrar, having considered the combined effect of the matter listed in subparagraphs (i), (ii) and (iii) of s 41(5), is not satisfied that the trade mark does or will distinguish the designated goods as being those of the applicant, the Registrar must reject the application (s 41(2)).
The start-point for my consideration of the inherent adaptability of the trade mark to distinguish the applied-for goods and services is thus subsection 41(3) – it is to first take into account the extent to which the trade mark is prima facie inherently adapted to distinguish the designated goods or services from the goods or services of other persons. The test for inherent adaptation was discussed in Clark Equipment Co v Registrar of Trade Marks [1964] HCA 55; (1964) 111 CLR 511 where Kitto J said at paragraph 5:
That ultimate question must not be misunderstood. It is not whether the mark will be adapted to distinguish the registered owner’s goods if it be registered and other persons consequently find themselves precluded from using it. The question is whether the mark, considered quite apart from the effects of registration, is such that by its use the applicant is likely to attain his object of thereby distinguishing his goods from the goods of others. In Registrar of Trade Marks v. W. & G. Du Cros Ltd. (1913) AC 624, at pp 634, 635 Lord Parker of Waddington, having remarked upon the difficulty of finding the right criterion by which to determine whether a proposed mark is or is not “adapted to distinguish” the applicant’s goods, defined the crucial question practically as I have stated it, and added two sentences which have often been quoted but to which it is well to return for an understanding of the problem in a case such as the present. His Lordship said: “The applicant’s chance of success in this respect (i.e. in distinguishing his goods by means of the mark, apart from the effects of registration) must, I think, largely depend upon whether other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connexion with their own goods. It is apparent from the history of trade marks in this country that both the Legislature and the Courts have always shown a natural disinclination to allow any person to obtain by registration under the Trade Marks Acts a monopoly in what others may legitimately desire to use.
Mr Round’s submissions and the evidence of the applicant stress the fact that no other trader uses the expression Local directories your local phonebook in relation to their directories in Australia. As the applicant’s evidence claims the applicant to be one of only two such directory publishers in Australia, this lack of use of the phrase by another trader in Australia is not surprising. However, if, hypothetically, there were a large number of other phone directory publishers in Australia and the expression was not being used in trade, this fact would not be decisive as to the inherent adaptability of the opposed trade mark to distinguish: see Eutectic Corporation v Registrar of Trade Marks (1980) 1A IPR 550 where the trade mark EUTECTIC was (because of its dictionary and technical meanings) held to lack any inherent adaptability to distinguish in respect of welding materials, notwithstanding its lack of use as a term in the trade (and, indeed, the ignorance of many in the trade as to its technical meaning).
This ‘lack of use by others in trade’ argument has obvious problems – it may be, for instance, that no trader apart from a putative applicant uses the colour BLUE on its service stations; however, this fact on its own does not change the intrinsic nature of the colour trade mark BLUE on service stations as regards that colour’s inherent adaptability to distinguish in respect of service station goods and services: Woolworths Limited v BP plc (No 2) [2006] FCAFC 132; Philmac Pty Limited v The Registrar of Trade Marks [2002] FCA 1551. The fact that no other trader is using the trade mark in the ordinary course of trade and without improper motive is not determinative, per se, of the inherent adaptability of the proposed trade mark to distinguish – however, the fact that other traders are innocently using a sign in the ordinary course of trade in relation to their similar goods or services provides corroboration of a finding of lack of inherent adaptability. In fact, the answer to the question of inherent adaptability lies in consideration of the intrinsic nature and attributes of the trade mark itself and whether, in future, it will or is likely to be innocently needed by other traders to use in relation to their similar goods or services in the normal course of trade.
The absence of other traders, or other traders who are likely to need to use an expression, is a factor to be considered in any assessment of the capacity of a trade mark to become distinctive, or whether it has in fact become distinctive. It is one factor to be taken into account in considering a matter under either of subsections 41(5) or (6). It is not a factor in the evaluation of the prima facie inherent adaptability of a trade mark to distinguish – that assessment lies in the inherent qualities of the trade mark.
Where this assessment lies was spoken of by Rodgers J at page 554 of Eutectic, above:
The relevant question was posed by Dixon CJ in Mark Foy’s Ltd v Davies Coop & Co Ltd (1956) 95 CLR 190 at 195; 1A IPR 470 at 471:
The test must lie in the probability of ordinary persons understanding the words, in their application to the goods as describing or indicating or calling to mind either their nature or some attribute they possess.
“Ordinary persons” received more detailed consideration in a decision which although dealing with an invented word has equal application to s.24(1)(d). In Howard Auto Cultivators Ltd v Webb Industries Pty Ltd (1946) 72 CLR 175, his Honour’s statement of principle directs the inquiry in case of a specialised product to the ``section of the community following a particular pursuit or possessing special vocational or technical interests’’. I gratefully accept the guidance provided by Lee J in his recent decision in Bausch & Lomb Inc v Registrar of Trade Marks (1980) 28 ALR 537 at 542 et seq. After referring to Dixon J’s judgment, his Honour said in the context of the appeal before him:
In my view one must approach the matter not as a layman with a loose knowledge to which I have referred, but from the point of view of how the word would be accepted among those who in fact distinguish the lens of one manufacturer from that of another by reference to a trade name, and in this case these are in the main the specialists in the field of eye care and to a lesser extent their patients.
Here, of course, the ‘ordinary person’ is the user of the telephone directory or the advertisers therein.
Mr Round submitted that the opposed trade mark only makes sense when consumers understand there is a business called “Local Directories” that supplies a telephone directory it describes as “Your local phonebook.” Consumers, Mr Round argued, need to look further to understand the opposed trade mark and a business in the ordinary course would not seek to confuse consumers by using such a phrase. I think that, if such an argument were good, expressions such as “Best flowerpots, your best plant container,” “Green barrows, your green wheelbarrow” or “Sharp axes, your sharp hatchet” should be regarded as having some inherent adaptation or capacity to distinguish. Such trade marks might be better illuminated if one knows that there are businesses called Best Flowerpots, Green Barrows and Sharp Axes, but the fact that there are or may be such businesses does not directly bear on the question concerning the inherent adaptation of such trade marks. The knowledge of the ordinary person that there are such businesses as Best Flowerpots, Green Barrows or Sharp Axes is an educative process and what I am here considering is the prima facie inherent adaptation of the trade mark. The educative process has not yet taken place – the educative process can only take place through use of the trade mark and the use of a trade mark should only be considered once it is determined that the issue falls under either of subsections 41(5) or (6): Ocean Spray Cranberries Inc v Registrar of Trade Marks [2000] FCA 177.
It is, I consider, with reference to traders producing telephone directories which target specific areas or localities, nearly impossible to avoid use of the words, ‘local directories,’ ‘local telephone directories,’ ‘local phone books,’ ‘local phone directories,’ ‘local listings,’ ‘local businesses’ and similar phrases employing the use of the word ‘local’. The opponent’s evidence aptly illustrates this and the applicant’s own evidence tends to support this view; the earlier McGarry declaration talks at paragraph 19.3 of ‘Local Banking institutions,’ at paragraphs 24.3 and 24.14 it talks of ‘local newspapers’ and at paragraph 32 it states “[the applicant] intends to increase the number of local phone directories it provides in these States and Territory, in addition to commencing the publishing of local phone directories in Victoria, South Australia, Western Australia, Tasmania and the Australian Capital Territory.”
I note that the word ‘local’ (as the opponent’s evidence illustrates) is used by advertising people to stress the notion that we live in a community rather than a society – the word ‘local’ is one which tends to be ‘loaded’ – and it is used as such in the opponent’s operations as shown in its evidence. Put another way, there is, according to the applicant’s evidence, one trader other than the applicant who publishes phone directories in Australia – this other person has used over 27 signs which include the use of the word ‘local.’
Pertinent to these observations are the words of Hearing Officer Kirov who, in Dawson Media Pty Ltd v News Digital Media Pty Ltd [2009] ATMO 37 at paragraph 36, referred to:
… the recent registry decision of Ruralco Holdings Limited v Robert and Alison Kerr [2007] ATMO 61 (28 September 2007) where Hearing Officer Williams found a trade mark featuring the words ‘THE LOCAL BLOKE Lawn & Garden Care’ combined with a simple device was not deceptively similar to marks that had been in use for more than 30 years featuring the words ‘Your Local Bloke’ in combination with the letters CRT and a simple device. It must be said that the evidence of the opponent’s prior marks’ longstanding use before the hearing officer was apparently significantly more substantial than that before me. Nevertheless, after noting the descriptive nature of the words ‘local bloke’ common to the marks under consideration, the hearing officer reasoned that:
Perhaps, however, a finding adverse to the opponent can safely be rested on a degree of equivocation; to the extent that the opponent has used the words in question as a trade mark, they are inherently words of such a character that their use by others is not likely to cause deception or confusion.
In other words, the expression THE LOCAL BLOKE … lacks inherent adaptation to distinguish the relevant goods or services of one trader from another trader’s similar goods or services.
In my consideration, the expressions ‘local directories’ and ‘local phonebooks’ in the opposed trade mark state nothing more than a description of exactly what the goods and services are. The addition of the word ‘your’ to the generic words ‘local phonebook’ adds no inherent adaptation to the trade mark. As a whole, in my assessment, the trade mark Local directories your local phonebook, although poorly punctuated, lacks any inherent adaptation to distinguish the goods and services of the applicant from those of other traders and the matter therefore falls for consideration in terms of subsection 41(6).
Having decided that the issue falls for consideration under subsection 41(6) of the Act, I am to consider whether because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant.
In considering the use of the trade mark, the following provision of the Act applies:
7 Use of trade mark
(1)If the Registrar or a prescribed court, having regard to the circumstances of a particular case, thinks fit, the Registrar or the court may decide that a person has used a trade mark if it is established that the person has used the trade mark with additions or alterations that do not substantially affect the identity of the trade mark.
Note:For prescribed court see section 190.
(2)To avoid any doubt, it is stated that, if a trade mark consists of the following, or any combination of the following, namely, any letter, word, name or numeral, any aural representation of the trade mark is, for the purposes of this Act, a use of the trade mark.
(3)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.
(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).
(5)In this Act:
use of a trade mark in relation to services means use of the trade mark in physical or other relation to the services.
The opposed application has a priority date of 14 September 2006. The trade mark that I can locate in the applicant’s evidence which has been used by the applicant before that date which most resembles the trade mark Local directories your local phonebook is that which the applicant first used in 2005 (see paragraph 25, above) and which, for convenience, I reproduce below:

The trade mark immediately above (albeit with the word ‘Australian’ substituted for the letters PDC) is also very similar to the applicant’s registration 1088135 which I have detailed at paragraph 27, above. The trade mark the subject of that registration was accepted for registration under the provisions of subsection 41(5) of the Act.
The lack of inherent adaptation to distinguish within the words Local directories your local phonebook is such that I must infer that the delegate found that there was sufficient adaptation to distinguish within the get-up of the 1088135 trade mark for it to be assessed in the light of the principle applied in Diamond T Motor Car Co’s Application (1921) 38 RPC 373 – ie that, though each of the word constituents (LOCAL DIRECTORIES and Your local phone book) in the compound trade mark might lack any inherent adaptation to distinguish, the arrangement or graphical set out is arguably not one which other traders in like-kind goods or services are likely to need to innocently use (although the delegate was unable to decide, on that basis alone, that the trade mark was capable of so distinguishing the designated goods or services[3] and that the provisions of subsection 41(5) therefore applied). Thus, the emphasis on what is registered under 1088035 is focused on the get-up, rather than the words within the trade mark.
[3] See subsection 41(5) of the Act.

It follows logically that the use of the registered trade mark – which is a ‘get-up’ trade mark, is not a use of the unadorned words. The words themselves are a simple statement as to the nature of the goods and services and lack any inherent adaptation to distinguish. So it is important to distinguish between the use of the get-up trade mark and the use of the words themselves. As Jacob J observed in British Sugar plc v James Robertson & Sons Ltd [1996] RPC 281 (‘Treat’) at 303:
There is an unspoken and illogical assumption that “use equals distinctiveness”. The illogicality can be seen from an example: no matter how much use a manufacturer made of the word “Soap” as a purported trade mark for soap the word would not be distinctive of his goods … I do not consider that the evidence filed to support the registration was anywhere near enough to support the conclusion that when the mark was registered, it was distinctive. Yes it had been used for about 5 years in conjunction with Silver Spoon, but it was not proved that the public regarded it as a trade mark — a reliable badge of trade origin — on its own.
There is no evidence before me that the applicant has used the unadorned words Local directories your local phonebook as a trade mark. The contextual occurrence of the words in the applicant’s trade marks at paragraphs 29 and 50, above, are in my consideration the kind of trade mark referred to by Jacobs J in Philips Electronics BV v Remington Consumer Products [1998] RPC 283, at 312:
...what we have here is a kind of “limping mark “, always used with what is obviously a proper trade mark. The same was true of Treat which was always used with “Silver Spoon”. [Supra.] Neither sign was ever used by the proprietor on its own. And this was evidence of a lack of capacity to distinguish. I do not of course say that you cannot have two trade marks used for the same goods, or that part of a sign - a “sub-sign” - cannot also be a trade mark: both Ford and Fiesta are obviously valid marks. But there are these other cases, where a sign proffered as a valid mark cannot really stand up on its own
There is no evidence before me that, before the priority date of the opposed application, the public regarded the unadorned expression Local directories your local phonebook as a distinctive trade mark of the applicant.
If I am wrong and the ground should be in terms of subsection 41(5), the applicant has not adduced evidence of the use or intended use of the unadorned words as a trade mark.
In the alternative, if the issue of the use of the trade mark Local directories your local phonebook is considered in the light of subsection 7(1), above, the get up in trade mark 1088035 is such that it should be viewed as an alteration or addition which substantially affects the identity of the trade mark – there can be no other reason, (other than an alteration in the identity of the unadorned words Local directories your local phonebook) that would, in my consideration, permit the acceptance of trade mark 1088035 under the provisions of subsection 41(5) rather than subsection 41(6). This being so, the applicant has had no use of the opposed trade mark as it has not been used without additions or alterations that do not substantially affect its identity.
It follows that the opponent has established its ground under section 41 of the Act.
It is not necessary to consider the other grounds pursued by the opponent at the hearing.

Decision

Section 55 of the Act provides:
Decision
55. Unless the proceedings are discontinued or dismissed, 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.
Note: For limitations see section 6.
As the opponent has established its opposition under subsection 41(6), I refuse to register application 1135497.

Costs

The opponent is entitled to its costs in this matter which I award against the applicant at the official scale.

Iain Thompson

Hearing Officer

Trade Marks Hearings

25 May 2010