Victor Stephen Palmer v Nike Innovate C.V.

[2023] ATMO 211

TRADE MARKS ACT 1995

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

Re:Opposition by Victor Stephen Palmer to application under section 92 of the Trade Marks Act 1995 (Cth) by Nike Innovate C.V. to remove trade mark number 718079 (class 25) - Flight 23 (figurative) - in the names of Victor Stephen Palmer, Cheryl Kistine Palmer and Andrew Victor Palmer.

Delegate:	Anne Makrigiorgos
Representation:	Opponent: One IP International Pty Ltd Applicant: Spruson & Ferguson
Decision:	2023 ATMO 211 Trade Marks Act 1995 (Cth) – application under ss 92(4)(a) and (b) – removal sought for entire registration – evidence does not establish that the trade mark has been used in good faith during the relevant period – discretion not exercised – registration to be removed

Background

1. On 20 January 2021, Nike Innovate C.V. (‘Applicant’) filed an application under ss 92(4)(a) and (b) of the Trade Marks Act1995 (Cth)[1] (‘Removal Application’) for the complete removal of the following registered trade mark in the names of Victor Stephen Palmer, Cheryl Kistine Palmer and Andrew Victor Palmer:

   [1] Unless otherwise stated, each reference to a section is a reference to a section of the Trade Marks Act 1995 (Cth) and each reference to a regulation is a reference to a regulation in the Trade Marks Regulations 1995 (Cth).

Registration Number	Trade Mark	Goods	Filing Date
718079	(‘Trade Mark’)	Clothing, footwear, headgear (‘Goods’)	23 September 1996

1. Victor Stephen Palmer (‘Opponent’) filed a Notice of Intention to Oppose removal of the Trade Mark and a Statement of Grounds and Particulars (‘SGP’) on 17 May 2021. The Applicant filed a Notice of Intention to Defend on 8 October 2021.

2. The Opponent filed Evidence in Support (‘EIS’) on 14 October 2021 which consisted of a declaration by Victor Stephen Palmer dated 30 April 2021 with various attachments (‘First Palmer Declaration’). The Applicant did not file any Evidence in Answer.

3. The parties were given the opportunity to be heard. An oral hearing was requested and heard by me as a delegate of the Registrar of Trade Marks on 22 November 2023 by video conference. Khajaque Kortian of Spruson & Ferguson appeared for the Applicant. Olaf Kretzschmar of One IP International Pty Ltd appeared for the Opponent. Observing was the Opponent. Written submissions were filed by both parties prior to the hearing.

Preliminary Matter

1. The Opponent’s written submissions include a second declaration of Victor Stephen Palmer dated 30 August 2023, with Annexures A to E, which provides further evidence in support of the opposition (‘Second Palmer Declaration’). I note that the Second Palmer Declaration has not been filed in accordance with the timeframe set out in the Regulations for filing evidence. The Opponent’s written submissions set out no basis as to why I should take this Second Palmer Declaration into account. In the hearing the Opponent’s representative claimed that when he became representative, ‘evidence needed to be filed as otherwise there would be nothing to say in the written submissions’. The Applicant has objected to the inclusion of the Second Palmer Declaration and submits that I should not have regard to it on the bases that there was no reason provided why this material could not have been put on as part of the EIS and the lack of probative value of the further evidence.

2. It is for the Opponent to rebut an allegation of non-use. Given the Removal Application claims non-use in the period during which the Opponent must establish use of the Trade Mark, namely the three year period ending on 20 December 2020 (‘Relevant Period), it should not have been any surprise that the Opponent would need to prove use of the Trade Mark in the Relevant Period on one or more of the Goods. The material in the Second Palmer Declaration would do little if anything to establish use, particularly since it does not offer up anything concrete in terms of use of the Trade Mark in the Relevant Period. Rather, it is composed entirely of unsupported assertions of use during the Relevant Period. This is determinative of the issue and I do not have regard to the Second Palmer Declaration. There is no purpose exploring any further what weight might in all the circumstances be attached to any of the material introduced by the Second Palmer Declaration, when all of it together could not materially affect the outcome of these proceedings. As such it is not necessary for me to consider in detail any of the other factors that can be weighed when deciding these issues (such as the length of the delay, the reasons offered for that delay, prejudice and the public interest).

3. I have therefore decided this matter based on the particulars set out in the SGP, the properly filed EIS and the written and oral submissions of the parties.

Summary of EIS

1. The declarant claims to have produced a range of clothing 30 years ago under the Trade Mark designed around basketball including t shirts, polo shirts, shorts, jumpers, trackpants, singlets and caps (‘Clothing’).

2. The declarant asserts his awareness of the Applicant’s interest in the Trade Mark by claiming that prior to adopting the Trade Mark, he called ‘Nike in America’ to ascertain whether they had any concerns with the Trade Mark being registered. The declarant further claims that the Applicant said they had no concerns. Palmer provides no indication of any date for these discussions nor any supporting evidence.

3. Palmer provides a number of undated photos of some Clothing bearing the Trade Mark. Palmer claims his son sold the Clothing to many sports stores but provides no indication of any date nor any supporting evidence such as invoices or advertising material. Palmer also claims that he and his son were unsuccessful in selling product to larger department stores again with no indication of any date nor supporting evidence. Finally, Palmer attests that after several years the owners of the Trade Mark stopped production, again with no indication of any date nor any intention to restart production.

Legal Framework

1. Part 9 of the Act deals with removal of trade marks from the Register for non-use.

2. In respect of this matter, s 92 relevantly provides (notes omitted):

Application for removal of trade mark from Register etc.

(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:

(a)  that, on the day on which the application for the registration of the trade mark was filed, the applicant for registration had no intention in good faith:

(i)  to use the trade mark in Australia; or

(ii)  to authorise the use of the trade mark in Australia; or

(iii)  to assign the trade mark to a body corporate for use by the body corporate in Australia;

in relation to the goods and/or services to which the non‑use application relates and that the registered owner:

(iv)  has not used the trade mark in Australia; or

(v)  has not used the trade mark in good faith in Australia;

in relation to those goods and/or services at any time before the period of one month ending on the day on which the non‑use application is filed;

(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.

1. The Applicant only presses 92(4)(b). I note that an application under s 92(4)(b) may not be made before a period of five years has passed from the filing date of the application,[2] and I confirm that five years since filing the Trade Mark have in fact passed.

   [2] Per s 93(2) prior to the Intellectual Property Laws Amendment (Productivity Commission Response Part 1 and Other Measures) Act 2018 (Cth) sch 1, pt 3 as applies in the present matter. The updated s 93(2) applies to trade marks filed from 24 February 2019 onwards.

2. The Opponent bears the onus of rebutting an allegation of non-use[3] by establishing, on the balance of probabilities,[4] that it has used the Trade Mark in respect of any or all of the Goods during the Relevant Period or that there were circumstances that were an obstacle to use in the Relevant Period.[5]

   [3] Act s 100(1)(c).

   [4] Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133] (Besanko, Jagot and Edelman JJ), albeit in respect of oppositions under s 52 of the Act.

   [5] Act s 100(3)(c).

3. In Woolly Bull Enterprises Pty Ltd v Reynolds,[6] Drummond J observed that the expression ‘use in good faith’ has a well understood meaning in terms of s 92, namely it is ‘real, as opposed to token, use in a commercial sense’. Provided the use is in good faith, ‘a single bona fide use of the mark’ may be enough to rebut an allegation of non-use,[7] but if a single act of use is relied upon then it should be established by ‘if not conclusive proof, at any rate overwhelmingly convincing proof’.[8] Importantly, little if any weight is to be given to bald assertions of use during the Relevant Period which are not supported by documentary evidence.[9]

   [6] [2001] FCA 261, [16].

   [7] Ibid [17].

   [8] Nodoz Trade Mark (1962) RPC 1, 7 (Wilberforce J).

   [9] Great White Shark Enterprises Inc v Joose Apparel Pty Ltd [1998] ATMO 8 (Delegate Forno); Aristedes Maniatis v Roche Diagnostics GmbH [2022] ATMO 59, [26] (Delegate Smith).

4. In accordance with s 101, if the grounds for removal are established, I may decide to remove the Trade Mark from the Register in respect of any or all of the Goods identified in the Removal Application, or if satisfied it is reasonable to do so, I may decide not to remove the Trade Mark from the Register. In other words, even if non-use is established, the Registrar retains a discretion not to remove the Trade Mark from the Register if satisfied that it is reasonable to do so.[10]

Discussion and Reasons

[10] Act s 101(3).

Use During the Relevant Period

1. The Relevant Period is crucial in a non-use matter. It is incumbent upon the Opponent to provide clearly dated evidence showing use of the Trade Mark upon, or in physical or other relation to, the Goods within that period in order to rebut the allegation of non-use. This has not happened. The evidence of use in the EIS was a) undated, b) contained unsupported assertions, c) in some instances, did not show the mark as registered and d) insufficiently contextualized, such that I cannot be satisfied that the purported use occurred during the Relevant Period.

2. Further, the entirety of the Opponent’s written submissions refer to matters which are not in evidence or are unsupported by evidence. The submissions are nothing more than a further attempt to introduce the same material in the Second Palmer Declaration, which I have already decided will not be considered part of the Opponent’s evidence. Given this, it follows that I will also not consider any submissions which refer to the contents of the Second Palmer Declaration.

3. I am satisfied that the Opponent’s evidence is utterly devoid of any concrete evidence of use of the Trade Mark during or after the Relevant Period and minimal evidence of use before the Relevant Period. Accordingly, the Opponent has not established that the Trade Mark has been used in good faith in relation to the Goods during the Relevant Period.

Obstacles to use

1. The Opponent did not submit that there were any obstacles to the use of the Trade Mark during the Relevant Period. For completeness, there is nothing to suggest that an obstacle prevented good faith use of the Trade Mark in relation to the Goods during the Relevant Period.

2. Accordingly, the Opponent has not rebutted the s 92(4)(b) ground for removal in respect of the Goods.

Registrar’s discretion

1. Pursuant to s 101, the Registrar has a broad discretion not to remove an unused trade mark if it is satisfied that it is reasonable to do so. In PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd, the Full Federal Court provided the following insights regarding the discretion under s 101(3):

   The following propositions are relevant to the exercise of this discretion:

   (1) It is broad and is unfettered in the sense that there are no express limits on it. It is to be understood as limited only by the subject-matter, scope and purpose of the legislation and, in particular, by the subject-matter scope and purpose of Part 9 of the Trade Marks Act.

   (2) The scope and purpose of the Trade Marks Act strikes a balance between various disparate interests. On the one hand there is the interest of consumers in recognising a trade mark as a badge of origin of goods or services and in avoiding deception or confusion as to that origin. On the other is the interest of traders, both in protecting their goodwill through the creation of a statutory species of property protected by the action against infringement, and in turning the property to valuable account by licensing or assignment. …

   (3) The particular purpose of Part 9, within which s 101 falls, is to provide for the removal of unused trade marks from the Register. It is designed to protect the integrity of the Register and in that way the interests of consumers. At the same time, it seeks to accommodate, where reasonable to do so, the interests of registered trade mark owners. Accordingly, the Court must be positively satisfied that it is reasonable that the trade mark should not be removed. The onus in this respect lies on the trade mark owner to persuade the Court that it is reasonable to exercise the discretion in favour of the owner. …

   (4) The discretion in s 101(3) is expressed in the present tense. It requires consideration of whether, at the time that the Court is called upon to make its decision, it is reasonable not to remove the mark.

   (5) The range of factors considered in the exercise of the discretion has included whether or not:

   (a) there has been abandonment of the mark;

   (b) the registered proprietor of the mark still has a residual reputation in the mark;

   (c) there have been sales by the registered owner of the mark of the goods for which removal was sought since the relevant period ended;

   (d) the applicant for removal had entered the market in knowledge of the registered mark;

   (e) the registered proprietors were aware of the applicant’s sales under the mark;

   (f) A further factor, explicitly noted in s 101(4), but which falls within the scope of the discretion in s 101(3), is whether or not the trade mark under consideration has been used by its registered owner in respect of similar goods or closely related services.[11]

   [11] [2021] FCAFC 128, [153] (Jagot, Nicholas and Burley JJ) (emphasis altered) (citations omitted).

2. Despite bearing the burden of persuasion, the Opponent has filed no submissions regarding the discretion nor has it furnished any cogent evidence that would favour the discretion being exercised. By contrast, the Applicant has submitted the public interest in maintaining the integrity of the Register will generally demand removal of a trade mark that remains unused within the Relevant Period. The Applicant has also directed me to its private interests in having the Trade Mark removed because of the association of the Trade Mark with the Applicant, as mentioned in the First Palmer Declaration, and that the Trade Mark is blocking the acceptance of its own application for 'FLIGHT' being trade mark application no. 2094404.

3. In these circumstances, it is not reasonable to exercise the discretion to preserve the registration. Simply put, the public interest in protecting the integrity of the Register is not served by allowing the Trade Mark to remain registered. As such, I decline to exercise the discretion.

Decision

1. The ground for removal under s 92(4)(b) has been established in respect of all the Goods. I direct that trade mark registration 718079 be removed from the Register one month from the date of this decision. In the event of an appeal from this decision, trade mark registration 718079 shall not be removed from the Register until the appeal has been discontinued or dismissed, or in the event of a decision from the court, the registration will be subject to that decision.

Costs

1. The Applicant has sought an award of costs. Costs usually follow the event. Accordingly, I award costs against the Opponent per s 221 in the amounts set out in Schedule 8 of the Regulations.

Anne Makrigiorgos
Hearing Officer
Oppositions and Hearings
Trade Marks and Designs
15 December 2023