DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re: Opposition by Mazen Abdul-Kader to an application under section 92 of the Act by Clipsal Australia Pty Ltd to remove trade mark number 1267136(9) -CLIPSO - in the name of Mazen Abdul-Kader
REPRESENTATION:
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Opponent: Phoebe Arcus of counsel instructed by Breen & Breen Solicitors
Applicant: Margaret Shearer of Banki Haddock Fiora Solicitors |
DECISION:
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2012 ATMO 2
Section 92 - use of trade marks - ownership – intention to use in good faith - use in good faith – trade mark to remain on register |
Background
- Mazen Abdul-Kader (‘the opponent’) is the registered owner of a trade mark, current details of which appear below:
Trade mark number: 1267136
Registered from: 27 October 2008
Trade mark: CLIPSO
Goods: Class 9:
Registered from: 27 October 2008
Trade mark: CLIPSO
Goods: Class 9:
Actuators (electric switches); air break switches; air operated electric switches; apparatus and instruments for switching electricity; audio switching apparatus; automatic time switches; automatic timing switches; change-over switches for use in demagnetising electromagnetic apparatus; change-over switches for use in demagnetizing electromagnetic instruments; circuit switches being operated by invertors; circuit switches being operated by motors; clip switches; coaxial switches; data packet switching apparatus; data packet switching installations; data switches; data switching apparatus; decade switches; devices for switching over energy tariffs; digital cross-connected switching apparatus; digital telephone switching apparatus; dimmer switches; domestic switches (electric); double pole switches; driving apparatus for switch points; electric breakers (switches); electric contact switches; electric lock switches; electric switchboxes; electric switches; electric switches being leaf switches; electric switches for electronic power control; electric switching apparatus; electrical devices for the switching of data; electrical push button switch assemblies; electrical push button switches; electrical push leaf switches; electrical push switches; electrical switch apparatus protected by synthetic covers; electrical switch assemblies; electrical switch boards; electrical switch boxes; electrical switch cabinets; electrical switch timers; electrical switches; electrical switchgear; electrical switching apparatus; electrical switching instruments; electrical time switches; electronic digital switching apparatus; electronic switches; electronic switching amplifiers; electronic switching apparatus; elevator switches; enclosed switch mode power supply apparatus; enclosed switchboards; fitted electrical switchboards; fittings for lights (switches); flexible circuits switches being electrical apparatus; grid switch panels; light switches; limit switches; liquid level switches; low voltage switching devices; mechanical contact switches; open and closed-loop switching apparatus; photo-electric switches; speaker switches; switch panels (electric); switch points (electric); switch socket outlets (electric); switchboards; switchboxes (electricity); switches, electric; switchgear (electric); switching boxes for use in electrical engineering; switching devices for electric contactors; switch-over circuits (electric); telephone switchboards; time switches, automatic; timers for switching on electrical devices at pre-programmed times; toggle switches (electric) (‘The Relevant Goods’)
- On 12 March 2010, Clipsal Australia Pty Ltd (‘the applicant’) filed an application under section 92(4)(a) of the Trade Marks Act 1995 (‘the Act’) for removal of the trade mark from the register.
- On 7 May 2010, the opponent filed Notice of Opposition to the removal, claiming use of the trade mark in good faith.
- The matter came before me, as a delegate of the Registrar of Trade Marks, for hearing in Sydney on 18 October 2011. The opponent was represented by Phoebe Arcus of Counsel, instructed by Breen & Breen Solicitors. The applicant was represented by Margaret Shearer of Bianki Haddock Fiora Lawyers.
Evidence
- The following evidence was filed and served pursuant to legislation:
- Evidence in support of the Opposition being a statutory declaration by Mazen Abdul-Kader made 4 May 2010 (First Abdul-Kader declaration).
- Evidence in answer comprising:
- a statutory declaration by Gary Busbridge made 3 November 2010 (Busbridge declaration); and
- a statutory declaration by Sarah Derderyan made 3 November 2010 (Derderyan declaration).
- Evidence in reply being a statutory declaration by Mazen Abdul-Kader made 4 May 2011 (Second Abdul-Kader declaration).
- Further evidence being a statutory declaration of Mazen Abdul-Kader made 4 May 2011 (Third Abdul-Kader declaration).
Relevant Legislation
- These proceedings were commenced after the date the 2006 amendments to the Act received Royal Assent, so the relevant legislation is as follows:
Application for removal of trade mark from Register etc.
92.(1) Subject to subsection (3), a person may apply to the Registrar to have a trade mark that is or may be registered removed from the Register.
(2) The application:
(a) must be in accordance with the regulations; and
(b) may be made in respect of any or all of the goods and/or services in respect of which the trade mark may be, or is, registered.
(3) An application may not be made to the Registrar under subsection (1) if an action concerning the trade mark is pending in a prescribed court, but the person may apply to the court for an order directing the Registrar to remove the trade mark from the Register.
Note: For prescribed court see section 190.
(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) ....
- The removal application was made only under s.92(4)(a), under which it is necessary to establish that the trade mark was registered without the necessary intention in good faith that it should be used, and that there had in fact been no use, or use in good faith, earlier than one month before the application for removal.
- Use, and authorized use, of a trade mark are dealt with in the following provisions:
Use of trade mark
7.(1) ...
(2) ...
(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) ...
Definitions of authorised user and authorised use
8.(1) A person is an authorised user of a trade mark if the person uses the trade mark in relation to goods or services under the control of the owner of the trade mark.
(2) The use of a trade mark by an authorised user of the trade mark is an authorised use of the trade mark to the extent only that the user uses the trade mark under the control of the owner of the trade mark.
(3) If the owner of a trade mark exercises quality control over goods or services:
(a) dealt with or provided in the course of trade by another person; and
(b) in relation to which the trade mark is used;
the other person is taken, for the purposes of subsection (1), to use the trade mark in relation to the goods or services under the control of the owner.
(4) If:
(a) a person deals with or provides, in the course of trade, goods or services in relation to which a trade mark is used; and
(b) the owner of the trade mark exercises financial control over the other person's relevant trading activities;
the other person is taken, for the purposes of subsection (1), to use the trade mark in relation to the goods or services under the control of the owner.
(5) Subsections (3) and (4) do not limit the meaning of the expression ``under the control of'' in subsections (1) and (2).
Relevant Dates
- The relevant non-use period for the purposes of paragraph 92(4)(a) of the Act is from the day on which the trade mark application was filed to one month ending on the day on which the non-use application is filed. Therefore, the relevant non-use period of the trade mark is from 27 October 2008 to 12 February 2010.
- Pursuant to paragraph 92(4)(a), the opponent’s intention to use the trade mark is to be determined as at 27 October 2008.
Onus
- Section 100 of the Act provides that the opponent bears the onus of rebutting an allegation under paragraph 92(4)(a) of the Act.
Narrowing the Issues
- At the beginning of the hearing, Ms Shearer made certain concessions in order to narrow the focus of the issues in dispute.
- Ms Shearer advised that the applicant did not wish to rely on “Wayback Machine” searches referred to in the Derderyan declaration as there was no context in which to interpret the results of searches.
- Ms Shearer made a further concession regarding the use of the trade mark. She stated that there was no “part use” issue, in that use of the trade mark was either on all of the relevant goods or none of them. The real issues, according to Ms Shearer, were whether the use was by the owner of the trade mark or an authorized user, or if so, whether such use was in good faith. The applicant’s position was also that the opponent’s application to register the trade mark was not in good faith.
Opponent’s Case in Rebuttal
- The opponent declared that he devised the trade mark and applied to register it. He then authorized the companies HEM Group Australia Pty Ltd and Clipso Electrical Pty Ltd to use the trade mark and distribute goods bearing the trade mark in Australia.
- The opponent exhibited company searches that show that he is one of the two directors of both companies and holds 50% shareholding in both companies. He is also the company secretary of HEM Group Australia
- The opponent exhibited examples of approvals gained by the companies to sell various electrical devices, a product guide brochure and websites, along with invoices for sales of various products comprising the Relevant Goods.
- Ms Arcus submitted that there was an abundance of evidence that the opponent, by way of the use of authorized users, used the trade mark in the relevant period in Australia in relation to the relevant goods. She further submitted that the opponent had maintained a connection with the goods in the course of trade by his selection of goods, his quality control of the goods, his selection and design of the advertising and packaging of the goods, his financial control over the goods and his position as director of the authorized users.
- Further, Ms Arcus pointed to the evidence demonstrating more than ‘token’ commercial use, rather it was a continuous course of genuine trade of goods sold under the trade mark.
Applicant’s Case
- As stated earlier, the applicant accepted that the companies - HEM Group Australia Pty Ltd and Clipso Electrical Pty Ltd - had used the trade mark during the relevant period for all of the relevant goods. However, the applicant did not accept that this was use by the opponent, or use in good faith.
- Ms Shearer put forward two alternative, but not mutually exclusive, premises for the use of the trade mark in Australia.
- The first is that the opponent never intended to use nor has he used the CLIPSO mark during the relevant period and any use of the CLIPSO mark cannot enure to his benefit as registered owner. It was submitted that use of the CLIPSO mark is not use by the opponent in good faith or otherwise. At best, Ms Shearer said, the company or companies of which the opponent is a director use the CLIPSO trade mark in Australia as a distributor/agent/licensee of goods sourced from Ningbo Clipso Electrical Co Ltd of China (“Ningbo Clipso). Accordingly, the opponent’s filing of the application was not with a good faith intention because he was not at the filing date the owner of the trade mark and did not intend to use the trade mark himself (nor authorize others to do so or assign the trade mark to a body corporate for its use). Further, it was submitted, the opponent has not subsequently used the mark in good faith or otherwise since the fundamental flaw in the choice of applicant for the trade mark persists into the use.
- The alternative submission was that the intention on filing the CLIPSO application could not have been in good faith and the subsequent use could not be use in good faith because the opponent’s intended use was not in good faith nor was the use based on that intention. Ms Shearer submitted that this was because adoption and use of the CLIPSO trade mark by the opponent, when considered against the range of goods upon which the applicant’s CLIPSAL trade mark is used by the applicant, the reputation of the CLIPSAL mark and the CLIPSAL mark itself, can only have been in order to deceive or cause confusion to consumers and, additionally, infringes in many cases the registered trade mark of the applicant being Registration 982758 Dolly Switch.
Use of the Trade Mark
- The first Abdul-Kader declaration satisfies me that there has been commercial use of the trade mark by HEM Group Australia Pty Ltd and Clipso Electrical Pty Ltd. In the first Abdul-Kader declaration, the opponent says that he authorized those companies to use the trade mark.
- The use of a trade mark is authorized use only to the extent that the user uses the trade mark “under the control of the owner of the trade mark”: section 8(2) of the Act. The essential requirement is that there must be a connection in the course of trade with the registered proprietor even though the connection might be slight, such as selection or quality control or control of the user in the sense in which a parent company controls a subsidiary: Pioneer Kabishiki Kaisha v Registrar of Trade Marks [1977] HCA 56; (1977) 137 CLR 670 at 683. Additionally, at 684, Aicken J reiterates that there is no requirement for a registered proprietor to manufacture the goods.
- In the third Abdul-Kader declaration, the opponent states, and exhibits relevant registrations, that he is managing director and 50% shareholder of HEM Group Australia Pty Ltd and Clipso Electrical Pty Ltd. In both of these companies, the other director and shareholder is the same person. I am satisfied that these companies are authorized users of the trade mark.
- Ms Shearer submitted that the true owner of the trade mark is the Chinese manufacturer, identified as Ningbo Clipso. The submission was based on research into Ningbo Clipso described in the Derderyan declaration, combined with an alleged paucity of the opponent’s evidence regarding Ningbo Clipso.
- While Ms Shearer’s submissions are based on a plausible hypothesis drawn from the research conducted, I am not satisfied that it amounts to evidence of fact. While the opponent has been very economical in describing his business connection with Ningbo Clipso, he has declared that he sources his goods from the Chinese manufacturer. None of the applicant’s evidence in answer contradicts the opponent’s evidence such that he might have been expected to provide further details of his relationship with the Chinese manufacturer.
- There is no evidence to support the hypothesis that Ningbo Clipso existed prior to and/or independently from the opponent’s application to register the trade mark. Nor is there any evidence to support the submission that the CLIPSO trade mark was adopted in order to deceive or cause confusion to consumers; I shall discuss this aspect later in this decision
Use of the Trade Mark in Good Faith
- The major issue in contention in these proceedings was that of using the trade mark “in good faith”. The opponent submitted that since the use of the trade mark was real, as opposed to token, commercial use, it was therefore in good faith. The applicant submitted that the opponent’s intention at the time of filing was in bad faith and subsequent use of the trade mark could not repair the fundamental flaw with the filing intention.
- Counsel for the opponent pointed to the opponent’s application to register his trade mark and his declaration to that effect as satisfying the requisite intention to use the trade mark in good faith. Ms Arcus rejected the applicant’s allegation of colourable activity and submitted, in any event, that such an allegation was not relevant to section 92(4) of the Act. She submitted that use in good faith must be real or genuine use in the commercial sense, rather than colourable activity and ‘token’ use: Johnson & Johnson Australia Pty Ltd v Sterling Pharmaceuticals Pty Ltd [1991] FCA 310; (1991) 30 FCR 326, at 354 per Gummow J.
- Ms Arcus also referred to the Full Federal Court decision in Liquideng Farm Supplies Pty Ltd & Ors v Liquid Engineering 2003 Pty Ltd [2009] FCAFC 7; (2009) 79 IPR 437, in which the Court considered a submission that the use of the trade marks in question was not ‘in good faith’ since those words were wide enough to cover circumstances in which the trade marks were used by the registered proprietor in relation to the same goods in order to take advantage of the positive association between those goods and the removal applicant. In rejecting this submission, the Court held (at [51] – [56] ) that the main concern of section 92(4) is with the genuineness of actual use as opposed to motives or conduct leading to or concerning that use. At [56] the Court concluded:
“[Section] 92(4) of the Act requires no more than a genuine intent to use the mark for commercial purposes, and that the reference to bona fide intention to use is not sufficiently wide to encompass the circumstances of the present case.’
- To support the applicant’s submission, outlined in paragraph 23 above, Ms Shearer referred to a number of decisions of this office where bad faith has been found to preclude an intention in good faith or use in good faith[1]. However, those decisions involved registrations for trade marks that were identical to those of other parties. In any event the later Full Federal Court judgment in Liquideng Farm Supplies Pty Ltd & Ors v Liquid Engineering 2003 Pty Ltd, supra, is clear as to the meaning of good faith for the purposes of section 92 of the Act.
- A low threshold has been set with regard to intention to use in that the act of making the application is prima facie evidence of an intention to use. Here, we also have the declaration of the opponent as evidence of the intention. Further, as the section 92(4)(a) ground requires both lack of intention to use and lack of use, proof of use rebuts the allegation, regardless of whether lack of intention can be shown.
- Having regard to the Act and relevant judicial authorities, along with the evidence and submissions of the parties, I am satisfied that the opponent has rebutted the applicant’s allegation of non-use.
- The similarity or otherwise of the trade marks of the parties is not relevant in these proceedings. Section 92(4) specifically limits the grounds for removal to those specified in the section. This is not the appropriate forum in which to deal with issues relating to whether or not the trade mark should have been registered: Edwards v Liquid Engineering 2003 Pty Ltd [2008] FCA 970. Removal proceedings are not meant to provide a ‘second bite at the cherry’ for parties who have missed time limits for initiating oppositions to registration of trade marks.
Decision and Costs
- The evidence satisfies me that there has been genuine commercial use of the trade mark with respect to the goods specified in the registration during the relevant period. The opposition is accordingly established and I therefore refuse to remove the trade mark.
- As the successful party, the opponent is entitled to his costs and I award costs against the applicant as per Schedule 8 of the Trade Marks Regulations 1995.
