Woolly
Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261
DRUMMOND J
DRUMMOND
J:
1
This is an appeal under
s 104 the Trade Marks Act 1995
(Cth) (“the 1995 Act”) from a decision of the Registrar’s delegate under
s 101 to remove the first applicant’s mark from the Register. The second
applicant has, at all material times, been the controlling director of the
first applicant. Its mark was registered as from 15 July 1992 in respect of
beer and all other goods in Class 32. On 17 September 1998, the respondent made
application under s 92 of the 1995 Act for removal of the first
applicant’s mark on the ground provided for by s 92(4)(b), ie, non-use by
the first applicant during the three year period 17 August 1995 to 17 August
1998 of its mark in relation to all of those goods. By his decision of 30
November 1999, the Registrar’s delegate ordered removal of the mark from the
Register.
2
The issues for determination in
this appeal are:
(1) whether the
respondent had standing to make the application for removal of the first
applicant’s mark, ie, whether the respondent was “a person aggrieved” within
the meaning of that expression in s 92(1); if so
(2) whether the first
applicant, who opposed the application for removal, had discharged the burden
of proving that it had, at some time during the three year period referred to,
used the mark “or the trade mark with additions or alterations not
substantially affecting its identity”: see ss 100(1)(c) and (3)(a); if not
(3) whether the first
applicant has discharged the onus of proving that there was an obstacle to the
use of the trade mark “during that period”: see s 100(1)(c) and (3)(c).
3
The applicants disavowed any
claim to have the residual discretion in s 101(1) exercised in favour of
the first applicant if it failed to establish use and if it failed to establish
circumstances within s 100(3)(c).
(1) person aggrieved
4
Though the public and not just
the applicant for removal of a mark has an interest in non-used marks not being
allowed to remain on the Register, the right to apply for removal created by
s 92 is not given to “any person”, only to “a person aggrieved”.
5
The Registrar’s delegate cited The Ritz Hotel Ltd v Charles of the Ritz Ltd
(1998) 12 IPR 417 at 454 and said:
“The
applicant here has applied for registration of the word trade mark RAGING BULL
on application number 721838 and the statement of goods, ‘Beverages in this
class including beers’ in Class 32. The present trade mark has been cited as a
bar to the registration of application number 721838 and the opponent here has
also accused the applicant that it is in breach of WBE’s registration. Accordingly,
I find that the applicant is such a person and qualifies to apply for removal
of the present trade mark from the Register.”
6
I do not think that the
Registrar was correct in holding that if an applicant for trade mark
registration is barred by an existing registration that, without more, means he
is a “person aggrieved” with respect to the latter mark for the purposes of s 92.
In The Ritz Hotel Ltd, it was said at
454 that a “person aggrieved” in the present context:
“would
include any person who would be, or in respect of whom there is a reasonable
possibility of his being, appreciably disadvantaged in a legal or practical
sense by the register remaining unrectified …”
7
To be capable of registration
as a trade mark, a sign must be “used, or intended to be used, to distinguish
goods or services dealt with or provided in the course of trade by a person”
from the goods or services of others (s 17). Only a person so using or
intending to use a sign is entitled to apply for its registration as a trade
mark (s 27). It is a ground of opposition to registration of a trade mark
that the applicant does not intend to use the mark “in relation to the goods
and/or services” specified in the application. An object of the 1995 Act is to
create, by registration of trade marks, a species of tradeable property - see
ss 21 and 22 - but only where such marks are connected with actual or
contemplated trade in goods or services. It would be contrary to this object of
the 1995 Act to accord standing to a person to attack a registered mark on the
ground that that person had made his own application for registration of a
conflicting mark where there was no proof that the person either had a trade in
goods marked with the mark the subject of his registration application or had a
bona fide intention to trade in such goods. Such a person cannot be said to be
“appreciably disadvantaged in a legal or practical sense” by a mark he wishes
to attack remaining on the Register, though he might wish to traffick in marks
as distinct from to trade in marked goods.
8
But the respondent is the
trustee of a family trust which operates the “Bootleg Brewery”, a mini-brewery
in the Margaret River district of Western Australia. Since 1995, the respondent
has made a beer which he has sold under the name “Raging Bull”. He intends to
pursue this activity. By application filed 14 November 1996, he sought
registration of the word mark “Raging Bull” in respect of all goods in Class
32. On 27 April 1997, the Registrar cited the first applicant’s registered mark
as a bar to the registration of the respondent’s trade mark application. Moreover,
in July 1998, Mr Burmingham advised the respondent’s solicitor that any use by
the respondent of the first applicant’s mark or any similar mark would require
its permission and, in the course of this litigation, the first applicant, by
Mr Burmingham, has alleged that the respondent’s activity in producing his beer
under the name “Raging Bull” infringes its rights in its registered mark.
9
In these circumstances, there
can, in my opinion, be no doubt that the respondent is “a person aggrieved” for
the purposes of s 92 of the 1995 Act. In Continental Liqueurs Pty Ltd v GF Heublein and Bro Inc (1960) 103
CLR 422 at 427 - 428, an applicant for removal of a mark was held to be a
“person aggrieved” within s 72 the Trade
Marks Act 1905 (Cth) (“the 1905 Act”) on the following basis:
“It is
enough to say that the respondent has shown an intention of preventing the
applicant from using the word, if by any means it can do so, and on some future
occasion it may well rely for this purpose on the trade mark now in question.”
10
See also Kraft Foods Inc v
Gaines Pet Foods Corporation (1996) 34 IPR 198 at 210 and New South Wales Dairy
Corporation v Murray Goulburn Co-Operative Company Ltd (No 2) (1989) 14 IPR 75
at 77.
11
The argument of the applicants
that, by failing to search the Register and thus to discover the existence of
the first applicant’s mark before he commenced to use his own “Raging Bull”
mark in 1995 or before he applied for registration of that mark in 1996, the
respondent disentitled himself from the discretionary remedy of removal of the
first applicant’s mark is unsupported by authority. The dictum of Whitford J in
“ASTRONAUT” Trade Mark (1972) 89 RPC
655 at 669 - 670 relied on by the applicants relates solely to the issue
whether the Registrar’s decision to reject the removal application was
invalidated by bias by reason of the comment the Registrar made about the
applicant for removal’s conduct in not searching the Register. I can see no
reason in principle why a person whose existing trade may be disrupted because
the owner of a registered mark is threatening to enforce his rights against the
former should not have standing to challenge the continued registration of an
allegedly unused mark, whether that person commenced his trade with or without
knowledge of the registered mark. The applicants’ submission is in conflict
with Kitto J’s ruling in Continental
Liqueurs Pty Ltd v GF Heublein and Bro Inc at 428 that, in seeking to deny
an applicant for removal the status of a “person aggrieved” within s 72 of
the 1905 Act, it was irrelevant to inquire into whether the applicant had
engaged in reprehensible conduct in establishing the business upon which he
relied to show that he had a real interest in having the offending mark removed
from the Register. The reason is the same as that given by Kitto J for refusing
to exercise the residual discretion to allow the non-used mark nevertheless to
remain on the Register on the ground of allegedly unconscientious conduct of
the applicant for removal in building up its business. His Honour said, at 433,
that that discretion:
“… is not
one to be exercised upon a consideration of any demerits of the particular
person who happens to be moving for expungement. The question whether the
respondent’s non-user of his trade mark disentitles him to have it retained on
the register is really one between the respondent and the public, and not only
between the respondent and the applicant …”
12
Further, the respondent says he
adopted his “Raging Bull” word mark in ignorance of the first applicant’s
registered mark. He was not challenged on this. A failure to search the
Register before using his own mark shows nothing approaching unconscientious
conduct on the part of the respondent even if that were relevant to the
question of his standing in these proceedings.
(2) Was the applicants’ mark used?
13
While the applicants do not say
their mark was used continuously throughout the period August 1995 to August
1998, their case is that it was used at least during the period March to April
1996 (as well as intermittently on other occasions). If what the applicants did
in the March to April 1996 period amounts to “use” of their mark, that will be,
without more, a good answer under s 100(3)(a) sufficient to defeat the
respondent’s removal application.
14
In order to establish the
ground for removal of a trade mark from the Register provided for by
s 92(4)(b), the applicant for removal must show that “at no time during
that period”, ie, the relevant “continuous period of three years” has the
registered owner used the trade mark in Australia in relation to the relevant
goods. An application for removal cannot be made on an allegation of almost
continuous non-use throughout the whole of the three year period: only an
allegation of unbroken non-use throughout a continuous period of three years
will suffice. If a single user of the mark during that period is sufficient to
disentitle a person from making an application for removal based on
s 92(4)(b), the opponent must be entitled by s 100(3)(a) to rebut the
allegation on which such a removal application is based by proving a use (in
good faith) on just one occasion during the three year period.
15
In Settef SpA v Riv-Oland Marble Co (Vic) Pty Ltd (1987) 10 IPR 402,
McGarvie J, speaking of s 23(1)(b) the Trade
Marks Act 1955 (Cth) (“the 1955 Act), said, at 437:
“The defendant must
establish that during the three-year period to 4 July 1983 the plaintiff did
not once use the mark in good faith in Australia: the Estex case (1967) 116 CLR
254 at 258-9. The contest between the parties is whether the plaintiff during
that period used its trade mark in Australia at least once.”
16
There are differences in the
wording of s 23(1)(b) of the 1955 Act and s 92(4)(b) of the 1995 Act.
In contrast to s 23(1)(b) of the 1955 Act, which required proof of no use
in good faith to justify removal of a mark, s 92(4)(b) provides for
removal either where the registered owner has not “used the trade mark in
Australia” or where the registered owner has not “used the trade mark in good
faith in Australia”. Section 92(4)(b)(i) deals with no use at all;
s 92(4)(b)(ii) deals with use, but a use which is not in good faith. Consistently
with s 92(4)(b), s 100(1)(c) casts the burden on the opponent to
removal of rebutting any allegation by the applicant for removal that the mark
has not “been used, or been used in good faith”; s 100(3)(a) then declares
that the opponent is taken to have rebutted “the allegation that the trade mark
has not … been used, or been used in good faith” only if he establishes that
the mark “was used in good faith”. Proof by the opponent of use within the
relevant three year period is not sufficient to rebut the allegation of
non-use: only proof of use in good faith will suffice. But s 92(4)(b)(i)
and (ii) only restate, in verbose fashion, the ground for removal for non-use
in s 23(1)(b) of the 1955 Act. (The expression “use in good faith” has a
well understood meaning in this context, viz, real, as opposed to token, use in
a commercial sense: see New South Wales
Dairy Corporation v Murray Goulburn Co-Operative Company Ltd (1989) 14 IPR
26 at 45 and Shanahan, Australian Law of
Trade Marks and Passing Off, 2nd ed, 1990, at pp 272 -
274.)
17
Though s 92(4)(b) is
differently expressed from s 23(1)(b), I do not consider the changes in
wording are enough to justify any different approach to the operation of the
new provision in the respect now relevant. Section 23(1)(b) of the 1955 Act,
which exposed a registered mark to removal where “a continuous period of not
less than 3 years had elapsed … during which there was no use in good faith of
the trade mark”, is similarly worded in this respect to s 92(4)(b). An
application for removal could not properly be brought on the basis of almost
continuous user under s 23(1)(b), just as a removal application cannot now
be brought under s 92(4)(b) on such a basis. A single bona fide use of the
mark in the relevant period is sufficient to answer an application for removal
under both provisions.
18
Both counsel relied upon Moorgate Tobacco Co Ltd v Philip Morris Ltd
(No. 2) (1984) 156 CLR 414 as showing what was required for there to be a
use of the applicants’ mark sufficient to answer the respondent’s allegation of
non-use. Moorgate was concerned with
whether what had been done in the course of establishing trading relations
between an overseas trader and an Australian trader amounted to a use in
Australia of the trade mark of the overseas trader. The specific issue for
determination was whether, at the time Philip Morris applied for registration
of the mark in question, Moorgate was already the proprietor of that mark for
the purposes of s 40 of the 1955 Act because it had previously used the
mark as a trade mark in Australia. Moorgate relied on the fact that, in
connection with discussions with Philip Morris about the possible introduction
of its low tar cigarette in Australia, Moorgate’s overseas predecessor, Loew’s,
sent packets of cigarettes and associated advertising material displaying a
version of the mark to representatives of Philip Morris in Australia. In the
leading judgment, Deane J said at 433 - 434:
“The cases
establish that it is not necessary that there be an actual dealing in goods
bearing the trade mark before there can be a local use of the mark as a trade
mark. It may suffice that imported goods which have not actually reached
Australia have been offered for sale in Australia under the mark … or that the
mark has been used in an advertisement of the goods in the course of trade: … In
such cases, however, it is possible to identify an actual trade or offer to
trade in the goods bearing the mark or an existing intention to offer or supply
goods bearing the mark in trade. In the present case, there was not, at any
relevant time, any actual trade or offer to trade in goods bearing the mark in
Australia or any existing intention to offer or supply such goods in trade. There
was no local use of the mark as a trade mark at all; there were merely
preliminary discussions and negotiations about whether the mark would be so
used. The cigarette packets and associated advertising material were delivered to
Philip Morris to demonstrate what Loew’s was marketing in other countries and
what Philip Morris might market, under licence from Loew’s, if it decided to
manufacture and trade in the goods in Australia and to use the mark locally at
some future time. There was no relevant trade in the goods in Australia and the
delivery of the cigarette packets and associated material to Philip Morris did
not, in the circumstances, constitute a relevant user or use in Australia of
the mark ‘KENT GOLDEN LIGHTS’ for the purpose of indicating or so as to
indicate a connexion in the course of trade between the new cigarettes and
Loew’s.” (emphasis added)
19
At the hearing, attention was
concentrated on the second applicant’s dealings in the period March-April 1996
with Mr Warner of Sanctuary Cove Brewery, a subsidiary of Carlton United
Breweries (“CUB”), as establishing that the mark (or the mark with relevant
additions or alterations) was used in good faith by the first applicant during
the relevant three year period. The applicants submitted that Mr Burmingham’s
dealings with Mr Warner of CUB showed that the first applicant had used its
mark during the course of those discussions in that it then had an existing
intention to offer or supply goods bearing the mark in trade within the second
limb of Deane J’s dictum in the passage in emphasis in Moorgate.
20
The applicants, in my opinion,
misunderstand what Deane J said. His Honour made the comment relied on in the
context of explaining what was necessary to establish use of a mark in
Australia by an overseas trader, though there was no actual dealing in goods
bearing the mark in this country in the sense of no actual sales or offers of
sale of the goods here. The dictum cannot be read in isolation from this
context. Where an overseas trader has in some way committed goods for export to
Australia, eg, by actually shipping them or by earmarking them for export in
some other way, there will be actual trade in the marked goods in Australia
sufficient to show use of the mark here where the foreign goods have been
offered for sale in Australia under the mark, though none have yet arrived
here. Further, where such a commitment of the goods has occurred, there will be
“an existing intention etc”, sufficient to show use of the mark in Australia
where the mark has been used, in advertising in this country their future
availability for purchase here, though none of the goods earmarked for export
to Australia have yet arrived. Deane J did not say that a subjective intention
of the owner of the mark to use the mark in trade at some time in the future
was, without more, sufficient to show use of a mark. What he said was that such
an intention, if accompanied by objective proofs of that intention in the form
of evidence of action by the mark owner to commit goods bearing the mark to
actual trade in Australia, would suffice to show use of the mark here at the
time in question, though no marked goods had yet been offered for sale in this
country.
21
McGarvie J understood Deane J’s
dictum as being to this effect in Settef.
One issue there was whether an Italian company, Settef, had used its
“Riv-Oland” word mark in Australia before 1978 so as to become the proprietor
of the mark here and thus entitled to the registration of the mark which it
obtained in 1978. McGarvie J said at 417:
“I consider that it
follows from the authorities that a mark is used as a trade mark only if it is
used with a view to facilitating or promoting the operation of a trading
channel which in a business sense had already been opened to Australia. The
mark must be used for the purpose of trade … The forwarding of samples and
brochures [in 1967] is not sufficient to indicate that Settef was ready and
willing to fulfil such orders as it received from Australia. The purpose of
these items may well have been to ascertain whether there was a market in
Australia sufficient for it to be worthwhile for Settef to export here. Use of
the mark in such preliminary activities would not be a use in the course of
trade: Moorgate Tobacco Co Ltd v Philip Morris Ltd (No 2) (1984) 59 ALJR 77 at
83.”
22
His Honour held, however, that
by late 1968, Settef had made a sufficient use of the mark here to entitle it
to be recognised as the proprietor of the mark. But, according to McGarvie J, a
present intention to offer goods with the mark on them is not sufficient to
constitute use of the mark unless there then exists “a trading channel which in
a business sense had already been opened to Australia”.
23
But Moorgate has been accepted as establishing in other contexts that
there is a line of demarcation between use of a mark in trade and activities
with respect to the mark which are preliminary to actual use of the mark. In Settef at 437 - 440 and Conquip Holdings Pty Ltd v S & A
Restaurant Corp [2000] FCA 256 at [76] to [85], this distinction was
applied to determine whether a mark had been used by the registered owner so as
to defeat an application for its removal from the Register for non-use. In Buying Systems (Australia) Pty Ltd v Studio
SRL (1995) 30 IPR 517, the distinction drawn in Moorgate between acts of user of a mark and acts preliminary to
user was applied to determine whether an opponent to an application for
registration of a mark had a good ground of objection to registration because
the opponent had itself used the mark prior to the date of the other’s
application.
24
In Settef, in the course of considering the defendant’s counter-claim
for removal from the Register of the plaintiff’s mark under s 23(1)(b) of
the 1955 Act for non-use, McGarvie J referred to the evidence of a visit by a
Mr Tessarallo to a principal of Settef in Italy during the course of which
Tessarallo said he was interested in distributing Settef products in Australia.
The Settef principal said he would visit Tessarallo early the following year
and, in the meantime, would send him publicity material to enable him to
research the market. Soon after, he sent Tessarallo sample books and catalogues
of Settef’s “Riv-Oland” marked products and, a little later, visited Tessarallo
in Australia, but did not think he would be a suitable distributor, so Settef
took the matter no further. McGarvie J, at 439, concluded:
“I do not regard
Settef as having used its trade mark in its transactions with Mr Tessarallo. At
no time did it open a trading channel to him by indicating that it was ready
and willing to sell to him. The matter never advanced beyond preliminary
discussions as in Moorgate Tobacco …”
25
However, he found sufficient
use of the mark to defeat the counter-claim for removal in other evidence that
the principal of an Australian company, J & P Applicators, during a visit
to the Settef factory in Italy agreed to commence immediately to promote
Settef’s products to architects and other potential users in Queensland and
that, though J & P Applicators purchased only one drum of “Riv-Oland”
marked material and three small sample tins similarly marked, it had purchased
the drum to make sample panels of the material to show to architects,
developers and others and used at least some of the material for that purpose. McGarvie
J said, at 439:
“In my
opinion the plaintiff made use of its trade mark in Australia through its
transactions with J & P Applicators. Settef was ready and willing to supply
Riv-Oland material to the Australian market through the trading channel to J
& P Applicators. In the first consignment the mark was used in relation to
the material by being used in the invoice and by being marked on the drum. It
was a use in the course of trade although the drum was purchased to make
samples to show to prospective customers and although only one drum of material
was sold … Sending the samples, brochures and catalogues to a trader who had
agreed to distribute the product was also a use of the trade mark. In my
opinion the use of the mark in the invoice and upon the three small tins
supplied free of charge in the second consignment was a use in relation to the
plaintiff’s goods in the course of trade.”
26
In Conquip, the only evidence of any activity that took place in
Australia in the relevant three year period that was relied on to show use here
of the mark was the despatch to Australia on a confidential basis of standard
menus used in an American restaurant chain operated under a trade mark name by
the American owner in response to an inquiry from an Australian resident
interested in discussing the possibility of opening up restaurants in Australia
under that same name by agreement with the American owner. The evidence was
that negotiations were unsuccessful and did not result in the opening of any such
restaurant here. Not surprisingly, Heerey J held that these negotiations were
“as their terms plainly indicate” of a preliminary nature and did not lead to
any use of the marks in Australia. It can be inferred that the American owner,
by sending his marked menus to Australia in response to the inquiry then
intended to use his mark as a trade mark in Australia, if agreement were
reached with the Australian inquirer for the opening of a restaurant here. But
that was not enough to show use of the mark in this country.
27
In Buying Systems (Australia) Pty Ltd v Studio SRL, the question was
whether Buying Systems had used the mark (the word “Studio” in relation to
fashion and hairdressing magazines) prior to the use of that mark by Studio SRL
so as to defeat the latter’s claim to registration as proprietor of the mark
within s 40 of the 1955 Act. The critical date was 8 December 1983. In the
period September to November 1983, Grand, the principal of Buying Systems,
decided to set about publishing a new fashion magazine under the name “Studio
Collections”. He had business cards and letterheads with the word “Studio”
printed. He contacted potential advertisers and solicited advertisements for
the new magazine. Two of the organisations approached in this period ultimately
took up advertising space in the first issue, which appeared in mid-1984. Gummow
J concluded at 520:
“These steps amount
to sufficient activity by the opponent to produce the result that [Studio SRL]
the applicant for registration at the date of its application on 8 December
1983 could not accurately put itself forward as claiming to be proprietor of
the relevant mark. The activities of the opponent were sufficient to constitute
a relevant use of the mark in Australia for the purpose of indicating or so as
to indicate a connection in the course of trade between it and the new
magazine. This is not a case where those activities occurred without any
existing intention to offer or supply the magazine in trade. The case is quite
different from activities of the nature discussed in Moorgate.”
28
Buying Systems not only had an
existing intention to trade in the magazine, it had gone beyond making
preliminary arrangements to use the mark by December 1983. It had an
objectively ascertainable commitment to offering to supply the magazine in
trade demonstrated by its having purchased and used appropriate business cards
and letterheads in connection with the proposed offering of the magazine and by
having solicited advertisers for the magazine. (In the absence of evidence as
to the subsequent publication of the magazine, however, it may well have been
difficult for Buying Systems to satisfy the Court that, by December 1983, it
then had an intention to offer or supply goods bearing the mark in trade and
had done things sufficiently unambiguous to objectively show that it had that
intention.)
29
Mr Burmingham says that it was
in August 1994 that he collapsed and suffered a severe relapse of his chronic
fatigue syndrome sufficiently severe to disable him from working at that time. This
necessitated postponement of surgery on his knee planned for September 1994
until February 1995. It was not until December 1995 that he says his health
gradually began to improve “for the first time in a number of years”. By about
March 1996, he says his health had improved sufficiently to allow him to hold
his discussions with Mr Warner of CUB in relation to the manufacture and
distribution of “Raging Bull” drinks, including beer and soft drinks. It
appears he took the initiative in contacting a Mr Murphy of the CUB plant at
Yatala. Murphy referred him to Mr Warner, the manager of the CUB brewery at
Sanctuary Cove, which acted as a development base for new products for CUB,
including beer and soft drink. In April 1996, Mr Burmingham says he had a
number of discussions with Mr Warner. These involved “the manufacturing and
distribution of the range of ‘Raging Bull’ drinks, including beer and soft
drinks”. Mr Warner sought an assurance that Woolly Bull Enterprises was the
registered owner of the “Raging Bull” trade mark. Mr Burmingham provided Mr
Warner with a range of promotional material. I accept that this consisted of
material substantially identical to that contained in exhibit 14 to Mr
Burmingham’s first affidavit. None of this material depicts the registered
mark, though, in various places, it depicts both word and pictorial elements of
that mark. Mr Burmingham describes the course of discussions with Mr Warner as
follows:
“47. Mr Warner expressed a
great deal of interest during the course of these discussions in reaching an
agreement to manufacture the ‘Raging Bull’ drink products. During the course of
these discussions Mr Warner expressed the need for a long term commitment to
CUB by the Company in respect of the ‘Raging Bull’ brand name and products. I
advised Mr Warner that I was prepared to enter into an arrangement with CUB
whereby the Company would licence all rights for ‘Raging Bull’ drinks,
including the rights to use ‘Woolsy’ in all marketing and promotion of the
‘Raging Bull’ drink products. This arrangement was to be conditional upon my
cross-promotion of the other Raging Bull products and my consent and
availability to consult with CUB with respect to marketing concepts and
opportunities for Raging Bull drinks and other products (e.g. Raging Bull
Records, Raging Bull Clothing, ‘The Adventures of Woolsy’, etc.).
48. The extent of my
discussion with Mr Warner were such that I undertook to him not to commence any
discussions or arrangements with any other parties until it became clear that
an agreement could not be reached with CUB. At that time there was no apparent
reason why an agreement could not be reached with CUB, and the opportunity
still remains open. It is now my health and the existence of this litigation
which is preventing me from exploiting this opportunity. Annexed hereto and
marked with the letters ‘DGPB15’ is a true copy of correspondence, dated 5
April 1996, which I forwarded to CUB at that time …”
30
In his letter of 5 April 1996
to Mr Warner headed “Private and Confidential” and with reference to “‘Raging
Bull’™ drink products” Mr Burmingham wrote:
“Further
to our meeting and subsequent discussions regarding your possible interest in
manufacturing various drinks by the above name, I now provide the following
background and information for you as requested …”
31
Mr Burmingham summarised the
first applicant’s use of the “Raging Bull” trade mark on beer that was
manufactured and sold in Victoria during 1992 for the first applicant and the
use of the trade mark, variously described as “Woolsy - The Original Raging
Bull”, “Woolsy” and “Raging Bull”, in relation to a range of other goods such
as records and videos. He suggested various other contexts, including sporting
events, in which the “Raging Bull” trade mark might be used and concluded this
letter as follows:
“As previously
advised to you, as ‘WOOLSY’™ is
distinctly Australian, it would be
my preferred option to work in conjunction with an Australian company and one which uses, as far as possible, natural
products and processes, such as your organisation.
As also discussed,
I can appreciate your concern to enter into an arrangement whereby you could be
left holding stock, etc., as with past experiences, and for this reason, I
would be prepared to look at an arrangement whereby your company would license
the ‘RAGING BULL’™ beer and soft
drinks, including the Trade Marks, and use of the character ‘WOOLSY - The Original Raging Bull’™
and other intellectual property rights, as well as making myself available on a
consulting basis for advice on marketing of the ‘RAGING BULL’™ drinks and cross-promotions with other associated
activities involving ‘WOOLSY’™ and
other ‘RAGING BULL’™ products, as
preferred by you.
…
I trust this
information satisfies all your immediate requirements for information and
background on the product and related ‘RAGING
BULL’™ activities, and look forward to talking with you further and
hopefully proceeding with an arrangement to our mutual benefit.”
32
Mr Warner did not reply: he
said in his letter of 29 August 2000 that, “as he had advised previously”, he
did not receive Mr Burmingham’s letter of 5 April 1996 addressed to him, though
Mr Burmingham subsequently provided him with a copy in 1999.
33
Mr Burmingham’s discussions
with Mr Warner came to a halt for the reason, according to Mr Burmingham, that
soon after writing to Mr Warner on 5 April 1996, he sustained a fall which
caused a range of orthopaedic injuries and another relapse of his chronic
fatigue syndrome. Soon after that, he spoke to Mr Warner about these problems
and gave evidence that: “We agreed that it was not appropriate to proceed with
any arrangement until I recovered my health.” Mr Burmingham also says that “due
to my on going medical problems I found myself in a state of extreme
impecuniousness in 1996”. The consequence was that in November 1996 he entered
into a Deed of Arrangement with his creditors under Pt X the Bankruptcy Act 1966 (Cth), a step which
resulted in him having to resign as a director of the first applicant and to
“refrain from any activities on behalf of the Company which may have been
deemed to be activities of a director”. It was not until January 1998 that the
trustee of the Deed certified that the arrangements had been carried out.
34
Notwithstanding what he said
was his obligation under the Deed of Arrangement, between February and May 1997
(when he again collapsed and had to cease all work activities), Mr Burmingham
says he “commenced discussions with various parties regarding ‘Raging Bull’
licensing opportunities which would complement and cross-promote the ‘Raging
Bull’ beer”. So far as they are relevant to the issue of use of the trade mark
in relation to Class 32 goods during the relevant period, these activities
included meetings and discussions with a licensing agency, a graphic designer
and a costume designer (regarding the preparation of ‘Raging Bull’ costumes for
use in promoting ‘Raging Bull’ products, including its beer). Quotes were
obtained from some of these organisations for promotional and other work to be
done for the applicants but, on the evidence, they were never followed up by
the applicants. In February 1997, Mr Burmingham also had discussions with the
Wool Exchange Night Club in Geelong which made an offer to Mr Burmingham to
hire the night club venue to him “at a discounted rate of $1,000” for the
relaunch of “Raging Bull” drinks. The principal of the Wool Exchange also
offered his services as production assistant with respect to the production of
a promotional video “at a nominal rate of $300 per week”. These offers were not
followed up either by Mr Burmingham.
35
In July-August 1997, Mr
Burmingham was in England “for family matters”, but on his return in September
1997 again collapsed with a relapse of his chronic fatigue system. The only
actions he took up to August of that year in 1998 with respect to the first
applicant’s registered trade mark involved communications with the Trade Marks
Office with respect to keeping up the application for registration of the mark
(a registration which the first applicant obtained in June 1998) and in taking
action to protect his mark in the face of the activities of the respondent.
36
Mr Warner was not called as a
witness, though his letters of 13 April 1999 and 29 August 2000 to Mr
Burmingham, which the latter solicited for use in this litigation, were put
into evidence as original evidence. Mr Warner, in his earlier letter, says:
“During
our meetings possibilities of producing products under licence were raised,
Gold Coast Brewery’s concerns about producing product and contributing to
another party’s brand equity, and the situation of being left with stock in our
warehouse were also discussed.
Since the
time of our meetings in 1996 Gold Coast Brewery has undergone changes in
strategic direction, and no longer produces private labelled beer products or
softdrink products. As such, this facility is not in a position to pursue
opportunities of the nature proposed by yourself.”
37
In his letter of 29 August 2000
to Mr Burmingham, Mr Warner repeated the substance of what he had to say in his
letter of April 1999, speaking again of the discussion turning on the
production by CUB of beer under license from the first applicant and of his
associated concerns. Mr Warner concluded his letter:
“Even
though Gold Coast Brewery was unable to produce the ‘Raging Bull’ drinks, I
have referred you to other parties within CUB with whom I believe you are still
exploring production opportunities.”
38
The tenor of Mr Burmingham’s
own affidavit evidence and what he had to say in the letter of 5 April 1996
which he wrote to Mr Warner was to the effect that he was proposing that CUB
enter into a licence arrangement for the use by it of the first applicant’s
mark in connection with goods to be produced and sold by CUB. Counsel for the
applicants, however, sought to develop an argument on the basis of Mr
Burmingham’s oral evidence and of Mr Warner’s letter of 13 April 1999 that
something rather different to that was discussed between Mr Burmingham and Mr
Warner, viz, an arrangement under which CUB would dedicate part of its
production capacity to producing beverages to be sold to consumers under the
first applicant’s mark either by the first applicant alone or by a joint
venture between CUB and the first applicant. Mr Warner’s letter was admitted as
original evidence only and so cannot provide a foundation for any such finding.
But even if the letter were admissible without qualification, it would not be
capable of supporting the finding contended for, given what Mr Burmingham
himself has to say in his affidavit about his discussions with Mr Warner
turning on licensing arrangements and what Mr Warner himself says in
confirmation of that in the opening words of the letter. Nor would that
finding, if made, advance the applicants’ case that Mr Burmingham’s dealings
with Mr Warner showed a use of the applicants’ mark.
39
In oral evidence, in contrast
with his affidavit testimony and contemporaneous letter to Mr Warner, Mr
Burmingham suggested that the discussions he had with Mr Warner in early 1996
were with a view to CUB entering into an arrangement with the first applicant
for the production by CUB of beverages for the first applicant which would be
sold to consumers by the first applicant under its mark. I am not prepared to
accept this late-emerging evidence. But even if I were, it would not assist the
first applicant’s case that it then used its mark.
40
Though I have no doubt that Mr
Burmingham was, at least in the period March-April 1996, trying hard to
persuade Mr Warner to commit CUB to an arrangement with the first applicant
under which CUB would produce and sell beer under the first applicant’s
registered mark or a version of it, his efforts were unsuccessful. His
subjective intention, no doubt bona fide, was that the first applicant’s mark
be used in trade. But that is as far as the case for the applicants goes. It
does not involve any use of the mark sufficient for the purpose of
s 100(3)(a). Though it is not necessary, for there to be such a use of a
mark, that there be an actual trade in the sense of the offering for sale and
the sale of goods bearing the mark, the owner will not use its mark unless it
has so acted to show that it has gone beyond investigating whether to use the
mark and beyond planning to use the mark and has got to the stage where it can
be seen objectively to have committed itself to using the mark, ie, to carrying
its intention to use the mark into effect. Mr Burmingham was never able to get
beyond attempting to establish a means for the first applicant to use its mark
in trade. That does not amount to any use of the first applicant’s mark in
trade sufficient to defeat the removal application. It goes no further than
discussions preliminary to the first applicant actually committing itself to
the use of the mark in the course of trade.
41
Given this conclusion, it is
unnecessary to consider whether the provision by Mr Burmingham to Mr Warner in
April 1996 of the folder containing the “beer label” version of the registered
mark, though not the mark itself, was the use of the registered trade mark
“with additions or alterations not substantially affecting its identity” within
s 100(3)(a).
(3) An obstacle to use of the mark?
42
The final question for
determination is whether the applicants can defeat the respondent’s application
to remove the first applicant’s mark in reliance on s 100(3)(c), even
though the mark has not been used in the relevant period.
43
The critical issue here is the
interpretation of the expression “because of circumstances (whether affecting
traders generally or only the registered owner of the trade mark) that were an
obstacle to the use of the trade mark during that period” in s 100(3)(c).
44
The applicants submit that any
circumstances constituting an impediment to the use by the registered owner of
the mark, other than circumstances created by or within the control of the
registered owner, come within this expression. The respondent in effect submits
that the phrase covers only circumstances of a trade character that impede the
owner’s use of the mark; the respondent submits that the section takes its
present form to expand the limited operation of the precursors to
s 100(3)(c).
45
Section 26(3) the Trade Marks Act 1938 (UK) (“the 1938 UK
Act”) prevented reliance by an applicant for removal on the ground of non-use
on “any non-use of a trade mark that is shown to have been due to special
circumstances in the trade and not to any intention not to use or to abandon
the trade mark”. Section 23(4) of the 1955 Act was to the like effect. The
authorities on this provision establish the following propositions:
(1) “The non-user must be
due to circumstances of the trade and not to special circumstances attaching to
and belonging to the trader personally”: In
re Columbia Gramophone Co., Ld’s Trade Mark (1932) 49 RPC 621 at 628;
(2) The expression “the
trade” in the section means the same trade in which the registered proprietor
is engaged: Aktiebolaget Manus v RJ
Fulwood and Bland, Ld (1949) 66 RPC 71 at 79.
(3) The phrase “due to
special circumstances in the trade” refers “to circumstances which are
‘special’ in the sense of being peculiar or abnormal and which are experienced
by persons engaged in a particular trade as the result of the working of some
external forces as distinct from the voluntary acts of any individual trader”: Aktiebolaget Manus at 79.
(4) For circumstances to
be “special circumstances”: “it is not … necessary that the ‘special
circumstances’ should be such as to afflict all traders equally or indeed to
afflict all of them at all”: Aktiebolaget
Manus at 79.
(5) It is not necessary to show that the “special circumstances” made
use of the mark impossible; it is enough to show that those circumstances made
it impractical in a business sense, to use the mark: “BALI” Trade Mark (1966) 83 RPC 387 at 406.
(6) Even if “special circumstances” are established, they will excuse
non-use only if there is a causal link between them and the non-use: In re James Crean & Son Ld’s Trade Mark
(1921) 38 RPC 155.
46
It can be accepted that the
wording of s 100(3)(c) was deliberately adopted to give the sub-section a
wider operation than the narrowly worded provision contained in s 23(4) of
the 1955 Act. It is now not necessary to show unusual or abnormal, as opposed
to normal or usual, trading conditions (a difficult concept to comprehend and
apply) before s 100(3)(c) can operate. Ordinary incidents of the trade
cycle commonly encountered by traders, as well as abnormal ones, are now within
the provision. Further, it is clear that a circumstance of a trading nature
that has an impact only on the registered owner can also now be relied on to
justify non-use of the mark.
47
In the context of
s 100(3)(c), there are, however, good grounds for reading “circumstances”
as not embracing any event of any kind. The circumstances must be “an obstacle
to the use of the trade mark by the registered owner”. This suggests that they
must arise from or comprise events external to the registered owner in the
sense of not having been brought about by the voluntary act of the owner.
48
But if any circumstance
external to the owner, in the sense of being a circumstance not brought about
by the voluntary act of the owner, is within the provision, the Court would be
drawn into inquiries of a kind that it is difficult to accept were in the
contemplation of the Parliament. Financial impecuniosity could excuse non-use
of a trade mark, irrespective of how enduring and intractable the owner’s
impecuniosity might be. Illness of the registered owner could also excuse
non-use of the registered trade mark (as is the contention of the applicants
here). A falling out between joint registered owners of a mark that disrupts
the use by either of the mark might also be capable of excusing non-use. In all
such situations, questions could arise requiring investigation by the Court
into whether the obstructing circumstances were due to the conduct of the
registered owner.
49
If the Parliament intended any
circumstance external to the owner to be capable of providing an excuse for
non-use, little purpose would be served by the words in parenthesis in
s 100(3)(c), viz, “whether affecting traders generally or only the
registered owner of the trade mark”. The presence of these words is some
indication that the circumstances comprising an obstacle to use of the mark
must not only arise externally to the registered owner, but must also be
circumstances of a trading nature.
50
Section 100(3)(c) is, in my
opinion, sufficiently obscure to permit recourse to extrinsic materials as an
aid to its interpretation: see s 15AB(1)(b) the Acts Interpretation Act 1901 (Cth).
51
In his second reading speech on
the Trade Marks Bill 1995, the Minister said (Hansard, 27 September 1995 at p
MC1910):
“The bill
implements Australia’s obligations under the WTO Agreement, but its main thrust
is to implement the government’s response to the July 1992 report, ‘Recommended
changes to the Australian trade marks legislation’, as modified by the
consultation process I have already mentioned. That report was prepared by the
working party to review the trade marks legislation, which comprised
representatives from the legal and patent attorney provisions, industry and
government. It was asked initially to review and streamline the trade marks
legislation, but as the work progressed its objectives expanded to take into
account the international developments already described.”
52
In its report of July 1992 to
the Minister for Science and Technology, the Working Party, in section 3.1
dealing with removal of trade marks for non-use, said that its proposals “took
into account the provisions of the TRIPS Agreement”, ie, the Agreement on Trade
Related Aspects of Intellectual Property Rights. TRIPS forms part of the
General Agreement on Tariffs and Trade 1994, which is contained within the
Agreement establishing the World Trade Organisation 1994: see Lahore, Patents, Trade Marks & Related Rights
at par 50,065. The Working Party’s recommendations under the heading
“Defence against an application for removal” included the following:
“33A. A
registration may be protected against a claim for non-use by:
…
circumstances
which constitute an obstacle to the use of the registered trade mark, whether
applicable to traders generally, or specific to the proprietor of the mark. For
example, regulatory delay for pharmaceuticals, regulatory prohibition of use
(e.g. tobacco products), import restrictions or circumstances of war could
constitute special circumstances affecting a specific trader rather than all
traders in a particular field.
The above
description is used rather than ‘special circumstances’ in order to accommodate
the somewhat wider terms of Article 19 of the TRIPS Agreement.”
53
The TRIPS Agreement is appended
to the Working Party’s report. Article 19 - “Requirement of Use” - states:
“If use
is required to maintain a registration, the registration may be cancelled only
after an uninterrupted period of at least three years of non-use, unless valid
reasons based on the existence of obstacles to such use are shown by the
trademark owner. Circumstances arising independently of the will of the owner
of the trademark which constitute an obstacle to the use of the trademark, such
as import restrictions on or other government requirements for goods or
services protected by the trademark, shall be recognized as valid reasons for
non-use.”
54
It is apparent from these extrinsic
materials that s 100(3)(c) was not intended by the Parliament to provide a
defence to an attack on a registered trade mark for non-use on any grounds,
including grounds entirely personal to the trade mark owner that do not bear
any trading character, so long only as they do not arise from the voluntary
actions of the owner.
55
In my opinion, circumstances
within s 100(3)(c) will only exist when events arise that are capable of
disrupting trade in the area of commercial activity in which goods bearing the
registered owner’s mark are traded. For the statutory excuse to be made out,
those circumstances must cause (in a practical business sense) non-use of the
particular mark by the owner, whether or not they have an impact on any persons
other than the owner of that mark who are also involved in that same area of
commercial activity. There must be a causal link shown between the relevant
circumstances and the mark’s non-use. This requirement arises from the fact
that s 100(3)(c) creates an excuse only where the mark has not been used
by the registered owner “because of” circumstances etc. It will not assist the
opponent to removal to show the existence of an impediment to use of the kind
referred to in s 100(3)(c) if he does not also establish that, but for
that impediment, he would have used the mark. Cf In re James Crean & Son Ld’s Trade Mark at 162.
56
Circumstances that do not have
a trade character but which only affect a mark owner in his personal character,
such as illness afflicting the owner of the mark that is sufficiently disabling
to prevent the owner using the mark, can never therefore found an answer within
s 100(3)(c) to an application for removal of the mark for non-use.
57
I mention that s 46(1)(a)
the Trade Marks Act 1994 (UK) now
permits revocation of a trade mark on the ground that “within the period of
five years following the date of completion of the registration procedure it
has not been put to genuine use in the United Kingdom, by the proprietor … in
relation to the goods or services for which it is registered, and there are no
proper reasons for non-use”. This Act was introduced in order to implement the
first Trade Marks Directive of the Council of the European Communities; the
reason why the expression “proper reasons” appears in s 46 is not because
the draftsman decided that the expression “special circumstances in the trade”
in s 26 of the 1938 UK Act should be replaced by a different one, but
because he was required to implement the EC Directive. See Magic Ball Trade Mark (1999) 117 RPC 439 at 441 and 442. Decisions
in which this provision has been considered are collected in Kerly’s Law of Trade Marks and Trade Names,
13th ed, 2001, at par 9-62. They are, however, of little
assistance in seeking the meaning of s 100(3)(c) because of the different
genesis of the UK legislation and the different wording of that provision.
58
There is also a question
whether circumstances that constitute an obstacle to use of the mark must exist
throughout the whole of the three year period if they are to be sufficient for
the purposes of s 100(3)(c) or whether it is enough that they exist during
a part (no doubt, during more than a de
minimis part), of that period. The latter view is, in my opinion, the
better reading. For the reasons given, a single bona fide use of the mark
during the relevant three year period is, by force of s 100(3)(a), an
answer to an application for removal for non-use. An obstacle of the kind
referred to in s 100(3)(c) to the use of the mark that operates only for
part (ie, more than a de minimis
part) of the three year period provides the same justification for
non-cancellation as does a single user of the mark in the relevant three year
period, but only provided the opponent to removal establishes that the mark
would have been used during that part of the three year period but for the
existence then of the obstacle. A use of the mark which it is shown would have
occurred during part of the three year period, but for the existence of the
obstacle during that part of the period, has, in my opinion, the same claim to
be recognised as excusing non-use that an actual use during that particular
part of the period has.
59
But even if the evidence were
sufficient to establish that for some time more than a de minimis period in the three years 17 August 1995 to 17 August
1998 Mr Burmingham was seriously ill and that, but for his illness, he would
have ensured that the first applicant used its mark during the period of his
disability that, for the reasons given, is incapable of providing the first
applicant with an answer, pursuant to s 100(3)(c), to the respondent’s
allegation of non-use of the first applicant’s mark throughout that three year
period.
60 The appeal must be dismissed.