Blue River Dairy LP v Spring Sheep Dairy NZ Limited Partnership
[2023] NZHC 1080
•8 May 2023
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2023-485-000031
[2023] NZHC 1080
UNDER The Trade Marks Act 2002 IN THE MATTER OF
an appeal from the decision of the Assistant Commissioner of Trade Marks dated
7 December 2022, [2022] NZIPOTM 31
BETWEEN
BLUE RIVER DAIRY LP, a New Zealand limited partnership having its registered Appellant
AND
SPRING SHEEP DAIRY NZ LIMITED
PARTNERSHIP, a New Zealand limited partnership having its registered office at 3 Melody Lane, Hamilton East, Hamilton, 3216, New Zealand
Respondent
Hearing: 1 May 2023 Appearances:
G Williams for the Appellant
G Hazel and G O Jackson for the Respondent
Judgment:
8 May 2023
JUDGMENT OF GENDALL J
Introduction
[1] In this proceeding, the appellant appeals a decision dated 7 December 2022 of the Assistant Commissioner of Trade Marks (the Assistant Commissioner) regarding an application the appellant made to revoke Trade Mark Registration number 1023801, Spring Sheep (the Trade Mark) owned by the respondent for non-use. In her decision, the Assistant Commissioner revoked part of the Trade Mark specification, but
BLUE RIVER DAIRY LP v SPRING SHEEP DAIRY NZ LIMITED PARTNERSHIP [2023] NZHC 1080 [8 May 2023]
confirmed that other parts of the respondent’s Trade Mark were not to be revoked for non-use. Both parties in this proceeding have now appealed that decision of the Assistant Commissioner. The substantive appeal has been set down to be heard in this Court at a one-day hearing on 1 August 2023.
[2] In the meantime, on 24 March 2023 the respondent filed an interlocutory application seeking leave to file further evidence on the appeal under R 20.16 of the High Court Rules 2016. The appellant opposes that application.
[3] Essentially, that interlocutory application concerns what the respondent as owner of the Trade Mark says is very limited but important further evidence to address the respondent’s use of that Spring Sheep Trade Mark. This evidence is to include details of the use of the Mark for a period after 10 June 2016 to 10 June 2019 inclusive (the Relevant Period) (being the period of non-use according to the appellant) to the extent that such evidence is germane to use within that Relevant Period.
The substantive appeal
[4] The appellant appeals to this court against those parts of the Assistant Commissioner’s decision1which held:
(a)The respondent within the three year Relevant Period had put its Trade Mark to genuine use in the course of trade in New Zealand, in relation to certain Class 5 goods including powdered infant formula, milk-based foods and beverages for infants containing sheep milk and the like. Accordingly, the Assistant Commissioner held the respondent’s Trade Mark was not to be revoked in respect of those goods for non-use.
(b)The use by the respondent of its Trade Mark in relation to the marketing in New Zealand of its stage 3 toddler milk also constituted use of the Mark for infant formula Class 5 goods.
1 [2022] NZIPOTM 31.
(c)Approaches the respondent had made to the two main supermarket chains in New Zealand, Progressive Enterprises and Foodstuffs, including details from a presentation given to Progressive Enterprises in May 2019, amounted to genuine use of the Trade Mark, sufficient to defeat a revocation application under s 65 of the Trade Marks Act 2002.
(d)Evidence before the Assistant Commissioner demonstrated the respondent had an objective commitment to use the Trade Mark in relation to infant formula and other class 5 goods; and
(e)Further evidence demonstrated that at the time of the Progressive Enterprises presentation, the respondent was “already producing infant formula in New Zealand for distribution overseas.”
Appellant’s substantive arguments
[5] At the forthcoming hearing of the substantive appeal in this proceeding, the appellant says it will argue that the Assistant Commissioner erred in fact and law by holding that the approaches the respondent made to the supermarket chains, Progressive Enterprises and Foodstuffs, including the May 2019 presentation given to Progressive, amounted to a genuine use of the Trade Mark sufficient to defeat the s 65 revocation application. According to the appellant, this is because a subjective intention to use a Trade Mark in relation to certain goods and/or exploratory actions with respect to the potential use of a Mark does not demonstrate the necessary objective commitment to the use of the Mark sufficient to establish “genuine use” that the case law requires.
[6] For there to be a genuine use by an owner of a Trade Mark, that owner must show that it has gone beyond investigating whether to use the Mark and beyond planning such use, and has itself got to the stage where it can be seen objectively to have committed itself to using the Mark; that is, to carrying its intention to using the Mark into effect.2
2 On this aspect see Fokker v Fokker (2019) 145 IPR 593, and Woolly Bull Enterprises PTY Limited v Reynolds (2001) 107 FCR 166, (2001) 51 IPR 149.
[7] Essentially, the appellant’s arguments at the substantive appeal will be to the effect that:
(a)none of the evidence the respondent adduced before the Assistant Commissioner demonstrated that it was committed to producing and marketing infant formula (or any other Class 5 goods) at any time during the Relevant Period; and
(b)evidence that the respondent did adduce before the Assistant Commissioner only established that it was intending to “market sheep milk as a range of three stages” generally for infants and toddlers.
Admission of further evidence on appeal under r 20.16
[8]Rule 20.16 relevantly provides:
20.16 Further Evidence
(1) Without leave, a party to an appeal may adduce further evidence on a question of fact if the evidence is necessary to determine an interlocutory application that relates to the appeal.
(2) In all other cases, a party to an appeal may adduce further evidence only with the leave of the court.
(3) The court may grant leave only if there are special reasons for hearing the evidence. An example of a special reason is that the evidence relates to matters that have arisen after the date of the decision appealed against and that are or may be relevant to the determination of the appeal.
(4) Further evidence under this rule must be given by affidavit, unless the court otherwise directs.
[9]Leave is sought here by the respondent under r 20.16(2) and (3).
[10] McGechan on Procedure, at para 20.16.02, in addressing the requirements for granting leave under r 20.16, states:
In B v A [2020] NZHC 580 the Court summarised the principles as follows (at [25]):
(a) the Court can receive further evidence if it thinks that the interests of justice require it to do so;
(b) it is wrong to allow an appellant to bolster his or her case with additional evidence that was available at the lower Court hearing, but not adduced because of the particular view of the case being taken at the time;
(c) admitting further evidence on appeal is exceptional rather than routine. A change of heart about how a case should have been run will not suffice. The prospect of further evidence triggering a substantial re-litigation before the appellate Court of the substantive case will count against admitting the further evidence;
(d) generally, the further evidence must be fresh, credible and cogent;
(e) evidence will not be regarded as fresh if it could, with reasonable diligence, have been produced at the trial;
(f) the absence of freshness is not an absolute disqualification. When the further evidence is not fresh, it will not generally be admitted unless the circumstances are exceptional and the grounds compelling. In addition, the further evidence needs to pass the tests of credibility and cogency;
(g) the interests of justice require the parties to put their best case forward at trial, in order to avoid wasting the Court’s limited time and resources. A high value is placed on finality when the parties have been afforded the opportunity and failed to take it; and
(h) the standard to be met is “rightly high”.
The proposed evidence
[11] The evidence for which the respondent seeks leave to adduce here is an affidavit from Shane Topp, the General Manager (Sales) of the respondent. That evidence, it appears, relates solely to sales of the respondent’s infant formula products in New Zealand after the Relevant Period.
[12] The respondent maintains this evidence is relevant here to the question of whether the respondent’s use of the Trade Mark was genuine, and in particular whether its “preparatory use” within the three-year Relevant Period of alleged non-use was also genuine.
Respondent’s submissions
[13] On its further evidence application, the respondent makes several arguments. First, its counsel, Mr Hazel, notes that the appellant suggested before the Assistant
Commissioner that the respondent had not genuinely used the Trade Mark on or in relation to the specific goods in question. Indeed, he adds it had shown “a lack of commitment to the Mark” because the respondent had not sold products under, and by reference to, that Mark in New Zealand, and this also included the time after the Relevant Period – the pleaded period of non-use.
[14] In response to these suggestions, the respondent says now that evidence of these matters was simply not provided by it at an earlier date as it was not put on notice as to its relevance until both the appellant made these submissions and also, in particular, until the appellant indicated it was intending to rely on matters taking place
after the pleaded Relevant Period.
[15] Accordingly, the respondent maintains in the interests of justice it should have an opportunity now to adduce evidence on this issue which relates particularly to what occurred after the alleged period of non-use. Accordingly, the respondent submits the r 20.16 test for introduction of additional evidence is met in this instance as it is particularly designed to meet a situation like the present. In summary, the respondent says the timing point raised for the first time by the appellant (that the respondent’s use of the Mark was not genuine because it was not using the mark on or in relation to infant formula goods until after the Relevant Period) was entirely new. It was the appellant’s submissions at that hearing before the Assistant Commissioner, a hearing which took place nearly two years after the close of evidence in this matter. The respondent notes too that at the hearing it did orally seek the Assistant Commissioner’s leave to file new evidence after the hearing confined to this issue, but the Assistant Commissioner declined leave.
[16] Finally, the respondent, with its present application for leave before this Court, maintains as I note that it is in the interests of justice for leave to be granted for the filing of this additional evidence which it says is fresh and cogent.
Appellant’s submissions
[17] The appellant’s position in response essentially is that all the evidence that was before the Assistant Commissioner is sufficient to determine relevant matters on this
appeal. It adds that the respondent should not now be allowed to attempt to bolster its case on these issues at the appeal for further reasons which are outlined as follows:
(a) This matter has already been determined by the Assistant Commissioner and there has been no appeal from that determination.
[18] As I have noted, at the hearing of the revocation proceeding before the Assistant Commissioner, the respondent sought leave to adduce the additional evidence it now seeks to adduce on this appeal. That request was declined.
[19] The respondent it seems did not appeal that aspect of the Assistant Commissioner’s decision. The time to do so, as I understand it, has now expired.
[20] In these circumstances, the appellant maintains the matter has been determined, a decision made, and this should not now be revisited.
(b) The proposed evidence is not relevant and therefore not cogent, nor are there special circumstances that justify its admission.
[21] As I understand the position, the proposed new evidence the respondent seeks to admit relates largely to its use of the Trade Mark for infant formula goods from January 2021 through to early 2023. The appellant contends, therefore, that this proposed evidence cannot be relevant to the question of whether the respondent used the Mark in relation to these goods within the Relevant Period. The appellant’s position is also that this proposed evidence cannot be relevant to whether the respondent had committed to using the Mark at any time during that Relevant Period. This January 2021 to early 2023 period is some time after the Relevant Period and it follows, according to the appellant, that the proposed evidence is not probative of the matters in issue in that it is not relevant in terms of s 7(2) of the Evidence Act 2006. Therefore, it should not be admissible.
[22] Accordingly, the appellant contends the proposed evidence is not cogent, nor are there any special circumstances justifying its admission and, indeed, if it is to be admitted, this would open the door in a floodgates manner for future similar arguments to be inappropriately raised.
Analysis
[23] In a 2009 decision of this Court, DaimlerChrysler AG v Sany Group Co. Limited3, which related to a similar application to the present to adduce further evidence on an appeal against a decision of the Assistant Commissioner of Trade Marks. Miller J noted that r 20.16 of the High Court Rules applies and went on to say:
[5] The Rule confers a general discretion upon the Court, to be exercised in accordance with the objective of the Rules; the just, speedy, and inexpensive determination of the proceeding. There are well-established principles to be applied in the exercise of the discretion. … there is power on appeal to re-hear evidence or receive further evidence, but the Court must be alert against an appeal from an expert body being turned into a new trial. The Court enquires whether the evidence could with reasonable diligence been called, whether it might affect the outcome if it accepted, and whether it is credible.
[6] Counsel debated whether the approach in trade mark cases is more flexible…I accept that trade mark cases display features that make the applicant’s task a little easier in practice. A trade mark is a monopoly, and there is a public interest in ensuring that it is not conferred in error.
[24] Relevantly, a similar point to this was accepted by Mallon J in this Court in Reiss (Holdings) Ltd v Network Clothing Company (Sales) PTY Limited4. In the Reiss (Holdings) Ltd case, which was also an appeal from a Trade Mark revocation decision, new evidence that the applicant for leave was not properly on notice about, was held to be admissible under r 20.16. As I see it, these are not entirely different situations from that prevailing in the present case before me.
[25] Here, a proper question arises as to whether the evidence in question is relevant to the issue of whether the respondent’s use, and in particular whether the respondent’s “preparatory use” within the Relevant Period of alleged non-use (being 10 June 2016 to 10 June 2019) was genuine. Before the Assistant Commissioner, the appellant argued that the respondent had not genuinely used the Mark in relation to the goods in question, and its counsel referred to “a lack of commitment to the Mark” on the part of the respondent, because it had not sold appropriate products then or even after the pleaded period of non-use.
3 DaimlerChrysler AG v Sany Group Limited, HC Wellington, CIV-2008-485-2333, 22 April 2009.
4 Reiss (Holdings) Ltd v Network Clothing Company (Sales) PTY Limited, HC Wellington, CIV-2007-485-2571, 19 May 2008 at [30].
[26] Notwithstanding this, in my view, the proposed evidence here is relevant and it is also fresh in that it was not “reasonably available at the first hearing”, nor could it with reasonable diligence have been adduced before the Assistant Commissioner.5
[27] That evidence clearly was not available at the time evidence was prepared and filed before the Assistant Commissioner. As I have noted, it relates largely to the respondent’s use of the Mark for infant formula goods from January 2021 through to early 2023. This period was well after all evidence for the hearing before the Assistant Commissioner was filed – this was by around October 2020.
[28] As to cogency, I am satisfied the proposed evidence is cogent, as it directly addresses the narrow point raised by the appellant, which as I understand the position had not been signalled before the Assistant Commissioner’s hearing. As I see it, evidence of use of the Mark by the respondent outside the Relevant Period could well be properly relied upon to indicate the genuineness of the use of that mark during the relevant period.6
[29] Lastly, I am satisfied here that any alleged prejudice the appellant claims it will suffer by leave being granted in this case will be minimal. Given the directions that will follow, if the respondent does wish to file evidence in response to the affidavit of Mr Topp, it will have time to do so.
[30] This case, in my view, has particular similarities to the decision of Miller J in the DaimlerChrysler case, where it was accepted special reasons existed for the purposes of r 20.16 and leave was granted for the provision of the new evidence.
[31] I conclude here that special reasons exist in this case to permit the respondent to file and serve the limited new evidence it seeks to adduce.
5 Complaints Committee No 1 of the Auckland District Law Society v P (2007) 18 PRNZ 760 (HC) and Comalco NZ Ltd v TVNZ Ltd, HC Wellington, AP117/94, 14 November 1996, and B v A [2020] NZHC 580 at [25].
6 Tahi Oils Ltd v Tahi Estate Ltd [2023] NZIPOTM5 at [77].
Result
[32] Given I have found special reasons do exist to allow the new evidence to be provided, the respondent’s application for leave to adduce the affidavit of Mr Topp is granted.
[33]The following timetable directions for this new evidence are now made:
(a)The respondent is to file and serve that updating evidence, being Mr Topp’s affidavit, no later than 19 May 2023.
(b)Any evidence in answer is to be filed and served by the appellant no later than 9 June 2023.
(c)Any evidence in reply to any evidence in answer filed and served by the appellant is to be filed and served by the respondent no later than 23 June 2023.
[34] As to costs, these are reserved. Counsel are encouraged to liaise with a view to settling the issue of costs between them. In the event that they are unable to do so, memoranda may be filed (sequentially) on the issue of costs and I will decide that question based on the papers and material which is before the Court. Those memoranda to be filed are each to be no more than four pages in length.
Gendall J
Solicitors:
Richmond Chambers for the Appellant
James & Wells Solicitors – Tauranga Branch for the Respondent
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