Grounds 1 and 2: Section 41(3) of the Act - Inherently adapted to distinguish
57 Sections 41(2) and (3) provide:
Trade mark not distinguishing applicant's goods or services
(1) . . .
(2) A trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons only if either subsection (3) or (4) applies to the trade mark.
(3) This subsection applies to a trade mark if:
(a) the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons; and
(b) the applicant has not used the trade mark before the filing date in respect of the application to such an extent that the trade mark does in fact distinguish the designated goods or services as being those of the applicant.
58 The predecessor provisions to s 41(3) of the Act, found in s 24(1) of the Trade Marks Act 1955 (Cth) and s 16 of the Trade Marks Act 1905 (Cth) identified particular kinds of trade marks which were satisfactory:
personal names represented in a "special or particular manner";
signatures (of the applicant or a predecessor in his business);
"invented words";
words "not having direct reference to the character or quality" of designated goods or services, and not in ordinary meaning geographical names or surnames; and
other distinctive marks.
59 Although s 41(3) of the Act is not expressed with that kind of detail, nonetheless, the general principle for its application is well established. As James Lahore states at p 54,528 in Patents, Trade Marks and Related Rights (LexisNexis Butterworths, 2001), "the key to interpretation of s 41(3) of the 1995 Act is the case law under s 24(1)(a)-(d) of the 1955 Act".
60 As the learned authors of Shanahan's Australian Law of Trade Marks and Passing Off (5th ed, Thomson Reuters (Professional) Australia Limited, 2012), Mark Davison and Ian Horak stated at [20.10], correctly, in our opinion:
Trade marks which would have been eligible for registration in Part A of the Register under the Trade Marks Act 1955 (Cth) … that is, those which fell into the categories set out in s 24(1) of that Act, should be regarded as inherently adapted to distinguish under the 1995 Act.
61 Nonetheless, at the threshold in this appeal is the issue as to just what is the test for answering the statutory enquiry as to whether a trade mark is inherently adapted to distinguish the designated goods from those of other traders.
62 The following general principle was stated by Kitto J in Clark Equipment Company v Registrar of Trade Marks (1964) 111 CLR 511 at 514:
[T]he question whether a mark is adapted to distinguish [is to] be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives - in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess - will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it.
(Emphasis added.)
63 However, senior counsel for Modena contended at the hearing of the appeal that what was articulated by Kitto J in Clark Equipment was refined by his Honour in the later case of F.H. Faulding & Co Limited v Imperial Chemical Industries of Australia and New Zealand Limited (1964) 112 CLR 537 such that the following words found in Clark Equipment at 514, were to be understood as parenthetical and surplusage and for that reason omitted from the statement of principle in Faulding at 555. The words found in Clark Equipment but omitted from Faulding are:
- in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess - …
64 This was not a submission put to the primary judge nor is it to be found in Modena's outline of written submissions on appeal. Nonetheless, the issue was fully ventilated before us.
65 The first observation to be made is that Modena's submission is at odds with the weight of authority, including, when taken as a whole, the judgment of Kitto J in Faulding. True it is that, in that case, his Honour at 555, when stating the principle, does not include the parenthetical words, but Clark Equipment is cited without qualification as authority for what he did state. Moreover, at 556 in Faulding, after considering the evidence going to the issue of distinctiveness, his Honour couched his conclusion on that issue by reference to the meaning of the word "barrier":
…. according to its ordinary signification for descriptive use … so that any trader … would be very likely indeed, in the ordinary course of business and without any improper motive, to desire to use the word in order to distinguish … .
This demonstrates his Honour's employment of the parenthetical part of the principle set out in Clark Equipment.
66 Kitto J in Faulding cited Eclipse Sleep Products Incorporated v Registrar of Trade Marks (1957) 99 CLR 300 at 310; and Registrar of Trade Marks v W & G Du Cros Ltd [1913] AC 624 at 634, 635. Both were decided before Clark Equipment. In Eclipse at 310, the High Court expressed the test in much the same way as it was put by Kitto J in Faulding at 555. This was an adoption of what had been said by Lord Parker in Du Cros at 634-635. This, contends Modena, makes good its submission.
67 Full Courts of this Court have consistently treated Clark Equipment as setting out the general principle informing the enquiry concerning "inherently adapted to distinguish" for the purposes of s 24(1) and (2) of the 1955 Act (definition) and in s 41(2) and (3) of the Act. These cases have uniformly adopted and applied the reasoning as to "words forming part of the common heritage for the sake of the signification which they ordinarily possess" found in Kitto J's formulation in Clark Equipment. Such cases include Chancellor, Masters and Scholars of University of Oxford (Trading as Oxford University Press) v Registrar of Trade Marks (1990) 24 FCR 1 at 4-5 per Lockhart J; at 9 per Jenkinson J; Mid Sydney Pty Ltd v Australian Tourism Co Limited (1998) 90 FCR 236 at 249-250; TGI Friday's Australia Pty Ltd v TGI Friday's Inc (2000) 100 FCR 358 at [46]; Kenman Kandy Australia Pty Ltd v Registrar of Trade Marks (2002) 122 FCR 494 at [144]-[147] per Stone J (with whom French J agreed at [49]) and see per Lindgren J in dissent on the result but not on the principles at [80]-[85]; Philmac Pty Ltd v Registrar of Trade Marks (2003) 126 FCR 525 at [42]-[49]; Mantra IP v Spagnuolo (2012) 205 FCR 241 at [41]-[52].
68 At one level Modena's submission is correct and the general principle may be stated as it was by Kitto J in Faulding at 555. The formulation there nonetheless contains the expression "without any improper motive". This part of the general principle raises its own definitional questions. It is a synonymous phrase to that used by Kitto J in Clark Equipment namely, "actuated only by proper motives". It is evident that it is this phrase which the parenthetical words employed by Kitto J in Clark Equipment explicate as being: -
- in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess - …
69 That said, the explication is directed towards "words" forming part of the common heritage. Clark Equipment concerned the word "Michigan". Self-evidently, trade marks often consist of more than just words and may now involve shapes and even colours. The application of the parenthetical explication is apt only to cases involving a mark consisting of a word or words. The fact that Clark Equipment and Faulding are often treated as interchangeable authorities is perhaps explained because many cases involve a word or words as the mark.
70 Stone J in Kenman Kandy in obiter at [146] expressed the view that whilst Kitto J in Clark Equipment was referring to word trade marks because that was the issue before him "there can be no doubt that his Honour's test would equally apply to shapes or other signs forming 'part of the common heritage'".
71 We are not immediately persuaded as to the correctness of this observation. However, it is unnecessary to resolve this issue determinatively. This case involves the use of words and it cannot presently be doubted by this Court that Kitto J's formulation in Clark Equipment sets out the principle generally applicable.
72 Importantly, the parenthetical explanation is not to be applied as though it were a statute. Phrases such as "common right of the public" and "words forming part of the common heritage" are of broad expression and will have a content and application in a variety of ways depending on the facts and circumstances of the case in question.
73 It should not be thought, for example, that the "public" necessarily means the general population, or even the general adult population of Australia.
74 Sections 41(2) and (3) are directed to the distinctiveness of an applicant's goods or services from those of other persons. We shall, for convenience, describe them as "traders". Accordingly, the enquiry is directed at least to traders with goods and services of the relevant kind and the likelihood, in a case such as this, of their thinking of and wanting to use the word(s) in question. The reference to "likelihood" by Kitto J in Clark Equipment was described by Gibbs J in Burger King Corporation v Registrar of Trade Marks (1973) 128 CLR 417 at 425 as a reference to the possibility that another trader "might", without any improper motive, want to use the mark in relation to his or her goods. Depending on the goods and services involved, the class of traders may be very large or quite small. The enquiry may also have regard to the knowledge and practices of consumers as a relevant consideration informing the likely actions of the traders, but it will not necessarily be the focus of the inquiry.
75 French J (as his Honour was) in Kenman Kandy at [47] explained that the ultimate question in applying the test of "inherently adapted to distinguish" is whether the mark, considered apart from the effects of registration, is such that its use by the applicant is likely to attain its object of thereby distinguishing its goods from the goods of others. His Honour held, in effect, that the answer to this question posed in Clark Equipment was one that:
… does not involve adventures in the Aristotelian taxonomy of form and substance. It requires a practical evaluative judgment about the effects of the relevant mark in the real world.
76 The High Court in Eclipse at 309-310 in its consideration of the analogous s 16(2) of the Trade Marks Act 1905 (Cth) and the phrase "adapted to distinguish the goods of the proprietor of the trade mark from those of other persons" held that this meant "adapted to distinguish in Australia having regard to the practice and conditions of the trade here …".
77 In Clark Equipment the mark was the name "Michigan". The Court took into account that in the US State of Michigan there were important manufacturing centres and that it was well within the bounds of possibility that persons other than the appellant may in the future produce goods there similar to some or all of the goods comprised in the category for which the appellant sought trade mark registration. That inquiry was not in any way directed to the knowledge of consumers or potential consumers although it may have been so.
78 In Faulding the Court considered the understanding within the relevant trade of the words "Barrier Cream". Reliance was placed on relevant trade journals and pharmacopoeia in order to arrive at a conclusion as to the "ordinary signification" of those words and in turn to determine what any trader in such creams would be likely to desire to do in using the words. Again there was no enquiry as to the knowledge of the general public whether as potential consumers of the product or otherwise.
79 Indeed, the majority of cases have involved an inquiry on this issue which is focussed on knowledge and practice within the relevant trade. As Reeves J put it in Mantra IP, correctly in our respectful opinion, at [55]:
… one trader is to be prevented from obtaining, by registration, a private monopoly over the use of [a word(s)] … because other traders have a "common right of the public to make honest use of" it …
(Emphasis added.)
80 This approach is hardly surprising given the relevant statutory provisions in the various iterations of Trade Mark legislation in this country. Sections 41(2) and (3) are in effect directed to the goods of different traders, in the sense we have employed that term. It seems to us that "the public" in Kitto J's parenthetical phrase in Clark Equipment is primarily referring to members of the public who are or may become traders, and who in the future may want to use the word or words in question, although that evaluative judgment is required to be made at the time of filing the trade mark application. However, as we have explained, an appreciation of the words used, beyond the class of traders and extending to consumers of the relevant goods or services, may also inform the answer to the inquiry because it may also be relevant to consider what consumers in the particular market in which those goods or services are traded know of the mark, whether consisting of words or otherwise, bearing on whether other traders are likely to want to use them.
81 Where the words used are English language words then considerations of the "common heritage" being that of the general public from whom traders and consumers will be drawn may very well be apt. Such was the case in Mark Foy's concerning the words "Tub Happy". Williams J at 199, referring to the speech of Lord Herschell in Eastman Photographic Materials Company Ltd v Comptroller-General of Patents, Designs and Trademarks [1898] AC 571 said:
The vocabulary of the English language is common property: it belongs alike to all, and no one ought to be permitted to prevent the other members of the community from using for purposes of description a word which has reference to the character or quality of goods.
82 This was the approach taken by the primary judge. In determining whether CINQUE STELLE and ORO are sufficiently inherently adapted to distinguish Cantarella's goods from goods of other persons, his Honour posited whether the Italian words were "commonly understood" or "generally understood" in Australia by "ordinary English speaking persons" as meaning five stars and gold respectively.
83 However, this approach was not appropriate in the present case where common Italian words descriptive of quality, are in issue. That this approach was taken by the primary judge, is demonstrable error. It will not necessarily be the correct approach even where the mark in question is an English word but where its meaning is not "commonly understood". Such was the case in Eutectic Corporation v Registrar of Trade Marks (1980) 32 ALR 211. There, the word in suit was "Eutectic' which means "of a nature to melt early". It was not a commonly understood word but its meaning was known and used within the welding industry. It was held, accordingly, that it could not distinguish one trader's welding goods and materials from those of another. The test for distinctiveness, which protects against monopolisation of words of common heritage, is focussed, as we have mentioned, on the likelihood of traders in the relevant goods or services thinking of and wanting to use, as here, the words in suit although not as a mark. This does not necessarily invite the question of whether such words, when they are foreign words, are commonly understood by the majority of English-speaking Australians although, depending on the particular mark in question, it may do so. It follows that we do not accept Cantarella's submission that without such a common understanding, a foreign word is no different from any invented word.
84 The expressions "the common right of the public" and "common heritage" employed by Kitto J in Clark Equipment are fluid and their content will vary according to the particular case. It seems to us that they refer to the knowledge base, primarily, of the traders in the particular goods and services, for it is the question of their likely use of the mark which is to be considered, although as we have already observed, it may extend to potential consumers.
85 There is no necessity to approach the enquiry from an Anglocentric perspective in the Australian context which has rich cultural and ethnic diversities within its population. Adopting the language of Kitto J, to accommodate this reality in the marketplace, one may consider the relevant words against the collective diverse heritage. Viewed in that way, the "common heritage" here included that of traders in coffee products sourced from Italy. Such traders may well be Italian or local importers. They may be local distributors who have in mind the large Italian speaking population in Australia as well as other Australians who, when it comes to coffee, want something with an Italian look and feel. Much of this country's coffee heritage in its language has its provenance in the Italian language e.g. caffÈ latte; cappuccino; affogato; caffÈ machiatto and espresso. It is evident that pure coffee in Australia is often associated with Italy and Italian coffee products.
86 Distinctiveness, being a question of fact, will involve contextual considerations. In Re Applications by Hongkong and Shanghai Banking Group Ltd (1990) 19 IPR 223. Delegate Hardie when considering marks comprising Chinese language characters for distinctiveness took into account, as relevant context, that it was reasonable to assume that a significant proportion of those availing themselves of the services of a Hong Kong bank operating in Australia would be literate in Chinese. The pool of people under consideration was minimal as a proportion of the general population of Australia. This is but an example of, in effect, the application of a common sense approach, the "practical evaluative judgment of the effects of the relevant mark in the real world": Kenman Kandy at [47] per French J.
87 Distinctiveness is to be judged at the time of the application for registration and prospectively. However, in judging the likelihood of what traders may wish to do, it is relevant to know whether or not other traders have also used the words. Such was the case, for example, in Faulding concerning the use of the word "Barrier" in relation to the relevant class of creams. It is not necessary, contrary to the submissions of Cantarella, that other traders have used them as trade marks. The words in Italian are entirely descriptive of their quality as premium coffee products. Molinari, amongst others, has imported coffee products to Australia using the descriptive words Oro and additionally Molinari has done so using the descriptive words Cinque Stelle since well before Cantarella applied to register them as trade marks.
88 It is unnecessary, in our opinion, that consumers know what the words mean in English. However, given that Italian is the second most spoken language in Australia, self-evidently many people in this country would in fact know what the words meant. Moreover, as the primary judge noted (at [86]), Cantarella explains on its packaging that "Oro" means "gold". Many Italian speakers would have understood the words Cinque Stelle and Oro as common Italian laudatory and therefore descriptive words.
89 Howard Auto-Cultivators Limited v Webb Industries Proprietary Limited (1946) 72 CLR 175 does not, in our view, aid the resolution of this matter. That case concerned whether a particular word which had been registered as a trademark was an "invented word" within the meaning of s 16(1)(c) of the Trade Marks Act 1905. But even if invented words provide some analogy, the question of how the word is to be understood must be tested from the understanding of the relevant section of the public: see Howard Auto-Cultivators at 183-184.