The Proctor & Gamble Company v Max Mara Fashion Group

[2000] ATMO 71

TRADE MARKS ACT 1995

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

Re:

Background

Trade mark application 724849 for the words MAX & CO was accepted for registration and advertised so in the Australian Official Journal Of Trade Marks of 3 July 1997.  A notice of opposition was filed by The Procter & Gamble Company (the opponent) on 2 October 1997.  The opponent requested two extensions of time to serve its evidence in support, which service was completed by 2 July 1998.  In accordance with the provisions of regulation 5.10, Max Mara Fashion Group Srl (Mara) was due to serve its evidence in answer by 2 October 1998.

The matter at issue in this decision is not the opposition itself.  It is a preliminary matter, that of the due date for submission of evidence in answer to the notice of opposition and to the opponent's evidence in support.  These proceedings stem from a decision by the Office to refuse a request for an extension of time in which to serve this evidence. 

The legislation

Under the provisions of regulation 5.10, the applicant is allowed a period of three months after service of the opponent's evidence in support in which to serve a copy of its evidence in answer.  An extension of this period may be requested, and such requests are governed by regulation 5.15. 

Regulation 5.15, so far as it is relevant, reads as follows:

Extension of period to serve evidence and service of further evidence

5.15     (1)       A party to the opposition proceedings may apply to the Registrar:
         (a)       for an extension of the period for serving a copy of the evidence under regulation 5.7, 5.10 or 5.12; or
 …

(2)       The Registrar may grant an application on reasonable terms specified by the Registrar.

(3)       The Registrar must not grant an application unless the Registrar:
         (a)       is reasonably satisfied that the applicant has served a copy of the application, and of any documents accompanying the application, on the other party; and
         (b)       has given the parties a reasonable opportunity to make representations concerning the application; and
         (c)       is reasonably satisfied that:

(i)        in the case of an application to which paragraph (1) (a) applies—the extension of the period for serving a copy of the evidence;
 …
  is appropriate.

Mara has complied with sub-regulation 3(a), and sub-regulation 3(b) has been satisfied.  The opponent has not objected to the grant of the present extension.  However, an officer of the Trade Marks Office (TMO) has raised an objection to the grant of this extension, on the basis that the reasons relied upon are not persuasive.

History of requests for extension of time to submit evidence in answer

The applicant has made 7 applications for three month extensions of time to serve its evidence in answer.  Should the extension in dispute be approved, the total time allowed for service of the evidence, including the statutory three month period, will be 2 years. 

First application

The first application for an extension of time was for three months until 2 January 1999.  The reasons given are as follows:

The applicant is continuing to collect information and evidence to support its application.  There is nothing to indicate the opponent will be prejudiced by the delay.  It is the first extension request for service of Evidence-in-Answer, and in the public interest for it to be allowed, to enable the applicant to place all available relevant information before the Registrar.

This application was allowed. 

Second application

The second application for an extension of time was for three months again, until 2 April 1999.  The reasons given are identical to those of the first extension application and the application was again allowed.

Third application

The third application brought the time up to 2 July 1999.  This application was supported with a statutory declaration, as is required by the Office guidelines (set out in an Official notice published in the Australian Official Journal of Trade Marks of 8 May 1997) in respect of extension applications at this stage.  The grounds to support the application are as follows:

I am instructed by the applicant that genuine settlement negotiations between the parties are in progress with a view to settling these proceedings and other oppositions worldwide.  I am instructed that the conclusion of these negotiations is imminent.

This application was allowed without objection.

Fourth application

The fourth application brought the time up to 2 October 1999, 12 months after evidence was due.  The grounds in the supporting statutory declaration gave details on a proposed meeting between the legal representatives of the parties in July of that year to continue the process of negotiations.  Again, this application was allowed.

Fifth application

This application brought the time up to 2 January 2000, and was supported by brief submissions as follows:

I am instructed by the Applicant that genuine settlement negotiations between the parties are still ongoing with a view to settling these proceedings and other oppositions worldwide. 

On this occasion, the Office issued a warning letter, which is worded in part as follows:

The allowance of this extension will bring the total time allowed for preparation of evidence to 9 months or more.

Whilst the reasons provided for seeking an extension of time to serve evidence have satisfied the Registrar thus far, any further applications sought will need to be supported by more compelling documentation.

As no objections were received to the grant of the extension, it was allowed.

Sixth application

This application brought the time up to 2 April 2000, and was supported by exactly the same reasons as those for the fifth extension.  The Office issued another warning letter, worded in part as follows:

Allowance of the previous extension until 2 April 2000 means a total of 12 months or more … have now been allowed for the preparation of this evidence.

You are respectfully reminded that if this extension is allowed, any further application for time will need to be supported by compelling reasons which should include a timetable indicating either completion of service of evidence or for when settlement negotiations may be finalised.

Again, as no objection to the application for extension was received from the opponent, it was allowed.

Seventh application

The application for extension, which is the subject of these proceedings, was filed on 29 March 2000, and was supported by reasons identical to those given in the fifth and sixth requests.  On this occasion, the office issued a warning letter which said (emphasis in the original):

Nine months or more … have been allowed for the service of evidence and it is considered that the reasons given for the present extension, as stated, do not warrant the allowance of further time.

YOU ARE ALLOWED 14 DAYS FROM THE DATE OF THIS NOTICE TO PROVIDE A MORE COMPELLING EXPLANATION IN SUPPORT OF THE GROUNDS FOR THE REQUEST FOR THE FURTHER TIME SOUGHT, OR TO REQUEST A HEARING OF THE MATTER, ACCOMPANIED BY THE PRESCRIBED FEE. IN THE ABSENCE OF EITHER OF THOSE ACTIONS THE EXTENSION WILL BE REFUSED.

No response was received from Mara's agents within the time allowed, and despite the wording of the official notice, a duty officer in the Hearings section wrote out as follows:

I refer to your application, dated 29 March 2000, for an extension of time to serve evidence in answer in the above proceedings.  I also refer to the official letter acknowledging this request sent to you on 6 April 2000.

This letter allowed you 14 days from the date of the notice in which to supply more compelling reasons to support the extension application, or to request a hearing on the matter.  It is now over 21 days and you have not met the requirements set out in the official notice.

I remind you that extensions of time are for the purpose of gathering evidence in answer, and while negotiations are regarded as compelling reasons up to a point, you have ignored repeated requests for more compelling reasons and/or a timetable setting out expected progress in negotiations.  All extensions of time require sound reasons, and I am of the opinion that those you have given are, at this stage of proceedings, not sufficient.

I will allow you 7 days from the date of this letter to request a hearing in the matter of the extension of time (accompanied by the usual fee).  Failing receipt of this request within the time period, I intend to refuse the extension application.

Mara, through its agents, applied to be heard.  It did not appear in person but supported its case via written submissions.

Submissions

The submissions are prepared by Shelly Einfeld, a legal practitioner employed by Mara's agents in Australia, Spruson and Ferguson.  They give a history of the applications for extension of time from 30 June 1999 to the present, and also of contact between Spruson & Ferguson, and Mara's instructing agent in Milan, Jacobacci & Perani, up to and subsequent to the time of the extension request under dispute.  Attached to the submissions are copies of correspondence between the parties, which demonstrate continuing, if somewhat irregular, contact, offers and counter offers.  Mara advises that it is still waiting for a response to a settlement proposal made in early October 1999, and to its reminders in late February and early May this year.

Ms Einfeld referred to the Registrar's decision in The Australian Olympic Committee (AOC) v Brennan[1], and the factors relevant for consideration when deciding whether to grant an extension of time.  She specifies that extensions since 2 April 1999 have been requested and granted on the basis of ongoing negotiations between the parties.  She notes that the opponent has not opposed any extensions of time, and also that she has no reason to believe that the negotiations have broken down. 

[1] (1994) IPR 44

Ms Einfeld submits that the opponent would not be inconvenienced by the grant of this extension of time, nor would it suffer any undue hardship.  However, she says, the applicant would clearly be disadvantaged by refusal of the extension as it would be prevented from filing evidence of use of its trade mark.  She also submits that the public interest would be best served by allowing the extension so that settlement negotiations may continue.  Should these negotiations fail, she submits that the applicant should then be allowed to prepare and file its Evidence-in-Answer.  In the event of this occurrence, she submits that the opposition should then be determined on its merits and not on a "mere technicality".[2]

[2] Vangedal Nielsen v Smith (1980) 33 ALR 144

Discussion

The issue to be considered here is whether the requested extension of time should be allowed, given that the applicant for the extension (Mara) has not responded to a number of requests from the Office for additional information in support of its extension applications. 

The law and procedures

Regulation 5.15, quoted previously, is quite specific at subparagraph (3) in saying that the Registrar must not grant an application unless s/he is reasonably satisfied that the extension is appropriate, the grant being based on 'reasonable terms specified by the Registrar' (subparagraph (2)).  In this case, the Office has requested, more than once, that additional material be supplied to support the extension applications.  These requests have, over a period of approximately 6 months, gradually escalated when no additional information was received.

The Official notice referred to previously (which has now been superseded by a notice published in the AOJT on 18 and 25 November 1999), sets out the type of information - the "reasonable terms specified by the Registrar", required to support an extension application, at various times during the process.  The essential detail of the notice is that all applicants for an extension of time are required to give a full explanation of why additional time is required.

The precedents

A delegate of the Registrar considered the matter of excessive time in proceedings in the Jonathon Sceats[3] case, and commented as follows:

[3] Application by Jonathan Sceats Design Pty Ltd 15 IPR 59

It has been a matter of concern to the Registrar for some time, however, that the time taken to complete the service of evidence in some proceedings can extend for several years.  In the absence of any objection to the continuing extensions from the other side, the Registrar is now acting to bring matters to a more expeditious conclusion by requiring some positive indication that negotiations towards a settlement, or preparation of the required evidence, are being actively pursued.

The provisions of the regulations allow extensions of time for the submission of evidence.  But case law precedents allow negotiations between the parties as a reason for delaying submission.  On the other hand, there is an expectation that the evidence should be prepared in anticipation of its eventual service.

In considering whether or not the extension should be granted, I am mindful of the principles set out in decisions such as Lyons[4], Vangedal-Nielsen supra, and The AOC v Brennan, also supra.  The questions for consideration are briefly set out as follows:

[4] Lyons (trading as Mitty's Authorised Newsagency) v Registrar of Trade Marks (1983) 1 IPR 416

• the amount of time so far spent on this stage of the opposition

• the reasons the party has given for seeking the extension

• the relative inconvenience to the parties and

• the public interest.

Looking at each of these in turn, the amount of time so far spent is almost 2 years.  Beaumont J, in the Lyons case, supra, refers to "the notorious fact that opposition proceedings usually involve the gathering of evidence from third parties and this usually takes considerable time".  However, in this particular case, there is little information to suggest that this evidence gathering has proceeded at all, after its mention in the first two extension applications.  Two years could be regarded as excessive for the gathering of evidence in answer, but the matter must be considered in tandem with the second issue, that of the reasons Mara has given for needing the additional time.

These reasons are, basically, that it is involved in negotiations with the opponent to settle the matter on a world wide basis.  The Registrar considers a negotiated settlement to be a desirable outcome, and this matter was discussed in the Jonathon Sceats decision, supra.  The delegate commented, at page 61:

The Registrar will be slow to limit a party to such proceedings by refusing further time in which to put in evidence, particularly where the other side does not object, and there is a real prospect of the matter being settled by negotiation.  Where the delay has become excessive, and there is no definite end in sight, the Registrar must give greater weight to the general public interest of effective, timely administration of these provisions of the Act.

The standard letters sent out by the Office, and mentioned previously, are designed to elicit persuasive information from the party concerned, when time is moving on, and the reasons given do not supply any detail.  The rather bald statement that negotiations are in train is scarcely sufficient detail, when almost two years has elapsed without any indication of progress.  Faced with an elapsed time of close to two years, and the briefest of reasons, it appears difficult to justify allowing additional extensions.

Ms Einfeld, in her submissions refers to the next two matters, namely the relative inconvenience to the parties involved, and the public interest.  I agree with her submissions on the inconvenience aspect, as it appears that both parties are satisfied with the status quo, but Mara stands to be the loser if not given the opportunity to submit its evidence.

Ms Einfeld suggests that the public interest would be best served by allowing the requested extension so that the settlement negotiations may continue towards finalisation. She also submits that, should the negotiations be ultimately unsuccessful, the applicant should then be allowed to prepare and file its evidence.  This viewpoint has some merit, but the matter of elapsed time must be considered.  It is not in keeping with either good administrative practice or the public interest to allow negotiations to progress for several years without interference, and then allow an unspecified amount of additional time for gathering evidence when the negotiations prove unsuccessful.  There must be some indication of good faith in keeping to the requirements of the legislation.

There is also another aspect of the matter of the public interest which I think should be mentioned, and that is the public interest in the Registrar having before him all possible information on which to base his ultimate decision[5].  This aspect can be persuasive, in some circumstances, in making the decision to allow a party additional time to file its evidence.  I am making the assumption that Ms Einfeld is referring, in part, to this aspect in her comments about extra time to file evidence, should negotiations fail. 

[5] Bundy American Corp v Rent-a-Wreck Pty Ltd (1985) 5 IPR 307

In considering requests for extensions of time, in instances where a party concerned is an overseas company, I am mindful that the Australian agents are often caught in a difficult position.  The agent is required to keep the opposition process alive, and does this by applying for extensions of time, whilst waiting for information from their opposite numbers overseas.  That notwithstanding, the Regulations are specific in demanding that the Registrar be reasonably satisfied before allowing a request for an extension of time for serving evidence.  When faced with a repeated lack of information, apart from an indication that negotiations are in progress, to be even reasonably satisfied the Registrar is justified in requesting more compelling reasons.  It is up to the agent to present what additional information s/he is able to supply when it is requested by the Office.

Mara's agents have not reacted to a number of requests by the Office for additional information to support applications for extensions of time in which to serve evidence in answer in these proceedings.  This raises questions as to the seriousness with which the parties regard the proceedings.  Failure to supply such information when requested could be regarded as an abuse of process. 

Mara stands to lose most if the opportunity to supply evidence in answer is denied it. The opponent has already filed its evidence in support and has a case to fall back on in this opposition.  Mara's agent in Australia is, to a degree, at a disadvantage because of a lack of information from its Italian associates.  It should, however, be prepared to supply what information it has to hand, and especially when such information is requested by the Registrar.

Regulation 5.15 gives the Registrar the discretion to grant, or not to grant a request for an extension of time, on reasonable terms as specified by the Registrar.  The Registrar must be reasonably satisfied the requested extension is appropriate before allowing the grant.  Prior to the date of the hearing, there was no information before the Registrar to determine the appropriateness of the grant.  Refusing the application under these circumstances was entirely appropriate.

However, it has been shown via the written submissions, outlined previously, that there was more information available of the type suitable to support an extension request.  Why this information was not supplied upon request by the Office has not been made clear.  Nevertheless, there was information available and it is my belief that the submission of such information at the appropriate times could have completely changed the course of events.  This issue may never have come before a delegate in the way it has.

Given that the information now placed before the Registrar shows the parties were corresponding with other on a fairly regular basis in an effort to reach a mutually satisfactory arrangement, I consider it to be in the interests of natural justice to allow Mara additional time to gather and file its evidence in answer.

By allowing this extension request, I do not intend to suggest that any future requests will be allowed without compelling reasons.  It is important to remember that extensions of time are for the purpose of gathering evidence.  Unsupported claims of negotiations between the parties will not satisfy the Registrar, except for relatively short periods.  All future requests should be supported with reasons which include an indication of the progress of negotiations and the gathering of evidence, time frames for completion of the process, and the steps taken by the Australian end of proceedings to apprise themselves of information relevant to the case they have to support.  It is simply not appropriate for the matter to be left as an open-ended process, nor for a party to ignore the Registrar's official letters. 

Decision

The application for an extension of time to serve evidence in answer is allowed.  The final date for service of this evidence is thus 2 July 2000. 

Alison Windsor
Senior Examiner

19 July 2000