Unilever Australia Ltd v Karounos

4 The ground upon which Unilever seeks to rely is that provided for in s 92(4)(b) of the Trade Marks Act 1995 (Cth) ("the Act"), namely non-use of the mark. It is relevant to note that under this paragraph, once an allegation of non-use is made, as here by Unilever, the onus is on the opponent (the respondents in the current proceedings) to adduce sufficient evidence to rebut the allegation.

UNILEVER'S SUBMISSIONS 5 Unilever submits that I should order the removal of the word and device mark for non-use in respect of goods and services in the remaining classes for the following reasons: (a) While in the judgment I expressed the tentative view that Unilever had conceded at least some use of the words "Real Fish'n Chips" as a mark, no such concession had in fact been made. I have been referred to the transcript of the hearing in these proceedings in support of this submission. (b) The only evidence of use of the word and device mark for food and beverages (classes 29 and 30) or restaurant and take-away services (class 42) is to be found in the affidavit and oral evidence of Mr Karounos. It is submitted that I should not accept Mr Karounos' evidence. (c) Alternatively, even if the evidence of Mr Karounos that there were fish and chips shops operating was to be accepted, there is no evidence that those shops were selling anything other than fish and chips so that the word and device mark should be removed in respect of all classes except fish and chips in class 42. (d) That the fact that evidence of witnesses was not called by the respondents to show use of the word and device mark enables the inference to be drawn that such evidence would not have assisted the respondents' case: see Jones v Dunkel (1959) 101 CLR 298. 6 Consequently, Unilever submits that the respondents have failed to rebut the onus imposed upon them by s 100(1)(c) of the Act and that, if any use of the word and device mark was evidenced, the respondents failed to establish that that use was as a trade mark. SHOULD THE WORD AND DEVICE MARK BE REMOVED IN RESPECT OF THE REMAINING CLASSES? The transcript 7 The transcript is perhaps equivocal on the question whether Unilever did concede that there was evidence of use of the word and device mark. However, I am prepared to give leave to Unilever to waive any concession it may have made and to consider afresh the evidence adduced. Evidence of use 8 Unilever submits (and I agree) that the only evidence before me that could amount to evidence of use as a trade mark of the word and device mark was that given by Mr Karounos. 9 As I noted in my previous reasons, the evidence of Mr McEntegart, including the annexures to his affidavit, said by the respondents to amount to evidence of use did not relate to use of the word and device mark but rather the word mark "REAL". If that evidence was capable of establishing any relevant use, that use would relate solely to the word mark. The market research conducted by Mr Hancock in April/May 1999 was unrelated to the word and device mark. 10 The only other evidence led by the respondents that could be said to go to the use of the word and device mark is the various agreements, the business card and the letterhead that were tendered. As I noted in my previous reasons, mere business cards or letterhead cannot suffice to prove on their own any use of a trade mark as a mark in relation to goods or services. 11 The various agreements tendered in evidence do not constitute any evidence of use of the word and device mark. The mere entry into a licence agreement is not evidence of use. The licence agreements in evidence merely conferred the right to the use of intellectual property, which included the word and device mark, in all classes except class 35. While the licence agreements contemplate the grant of franchises, as Unilever submits no evidence of the existence or grant of any such franchise was adduced. It would be inappropriate to infer the grant or operation of any such franchise, whether by Bacalon Pty Ltd or some other person, from the mere fact that a fish and chips shop operated under the name "Real Fish'n Chips". At best, this evidence shows an intention to confer rights to use the word and device mark for a contemplated real fish and chips franchise. This is not sufficient to establish any relevant use. 12 The Agency and Management Agreements in evidence give rise to the same problem. The Management Agreement was entered into as a prerequisite to a contemplated sublicence agreement between Mr Maxwell and Jilahk Pty Ltd. The Agency Agreement merely appoints Mr Maxwell as Mr Karounos' agent for the negotiation of licences and assignments of intellectual property including the word and device mark. 13 Further, there is no evidence linking any of these agreements with the registered owner of the word and device mark. They are accordingly not evidence of use by the registered owner of that mark. 14 Mr Karounos gave evidence that the last time a Real Fish'n Chips shop had operated in Adelaide was 1998 or early 1999 and that this shop had been operated by Bacalon Pty Ltd. I accepted the truth of this evidence in my previous reasons for judgment. Unilever had submitted in its "Supplementary Submissions in Reply" that this evidence should not be accepted because Mr Karounos was uncertain in choosing between 1998 and 1999 and because when he pleaded to the non-use allegation in the defence he stated that there was no use by Maxwell (including its sub-licensees) in the non-use period. It will be recalled that tendered in evidence was a sub-licence agreement between Mr Maxwell and Bacalon Pty Ltd ("Bacalon"), the company said to have been operating the last Real Fish'n Chips shop. 15 I do not consider that the failure by Mr Karounos specifically to refer to the sub-licence agreement between Mr Maxwell and Bacalon or to the operation by Bacalon of a Real Fish'n Chips shop in his defence requires the conclusion that his evidence should not be believed. The omission is not inconsistent with his denial of the allegation of non-use in his defence on the basis, inter alia, that a licence had been granted to Mr Maxwell, that a sublicence was granted to Bacalon and that Bacalon had operated a Real Fish'n Chips shop in the relevant non-use period. Additionally, the statement in Mr Karounos' defence relating to Mr Maxwell's failure to use the word and device mark was contained in the particulars to an alternative defence based on non-use resulting from circumstances beyond the control of the respondents. Similarly, this statement does not preclude the grant of a sub-licence by Mr Maxwell to Bacalon or a finding of a relevant use of the mark by a sub-licensee of Mr Maxwell, namely operation of a Real Fish'n Chips shop by that company. The particular to the defence was rather that there was a failure or inability on the part of Mr Maxwell to use the word and device mark "to the full extent envisaged in the terms of the Maxwell licence" (emphasis added). 16 In my opinion, these matters do not provide a sufficient justification for rejecting Mr Karounos' evidence. It is not uncommon for a witness to be uncertain as to the exact timing of events, particularly when they occurred some two years previously. And it may be observed that the difference in timing between the two possible end dates is not great. JONES V DUNKEL 17 Unilever relied upon the failure of Mr Karounos to adduce evidence of the following matters: · Advertising involving the use of the word and device mark or photographs showing use. · In relation to evidence of franchises, royalty receipts or other evidence of the payment of royalties and franchise manuals or the like which, it is submitted, would have been extremely easy to produce had franchises in fact been granted. · Evidence of payments by Mr Maxwell to Mr Karounos pursuant to the relevant agreements tendered. In particular, the failure to call Mr Maxwell or provide an explanation as to his whereabouts was emphasised. It is submitted that such evidence would have been readily able to be called by the respondents from other parties to enable the respondents to discharge the burden placed upon them by s 100(1)(c). 18 There are two formulations of the rule in Jones v Dunkel. The first is that where there is an unexplained failure to call a witness to give evidence on a material matter in issue it may be inferred that the evidence of that witness would not assist the case of the person who fails to call the witness. So it may here be inferred that had Mr Maxwell been called to give evidence about franchise agreements actually entered into his evidence would not have assisted the respondents. The second formulation is that the unexplained failure allows the Court more comfortably to draw an inference that is otherwise already open. 19 The rule does not permit inferences to be drawn where the evidence otherwise does not leave it open to draw such inferences. In particular, it does not follow from the rule that the failure of a party to call evidence, where such evidence would be required to satisfy the onus cast on the party, leads to the conclusion that such evidence as the party has adduced is to be disbelieved. The question in the present case is and remains whether the respondents have adduced sufficient evidence to satisfy the onus upon them to show on the balance of probabilities that there has been use of the word and device mark in the relevant period and in respect of the relevant class. CONCLUSION 20 The only evidence of use is that a Real Fish'n Chips shop operated at a time during the relevant non-use period. I am prepared to accept that this was the case. I accept Unilever's submission, however, that there was no evidence that anything other than fish and chips was sold. Indeed, there was no evidence adduced as to what this shop sold. However, it may readily be inferred that cooked fish and chips were sold to the public for take-away meals or, perhaps, consumption in the shop. Anything further would not be an inference but would be mere conjecture. 21 The provision of take-away fish and chips does not, as submitted by Unilever, merely fall within class 42. Class 29, which covers "take-away foods … including fish", also encompasses the provision of take-away fish. Consequently, I would order the removal of the word and device mark in respect of all classes except fish in class 29 and fish and chips in class 42. I would also order that Mr Karounos pay the costs of Unilever. I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Hill.

Associate: Dated: 7 December 2001 Counsel for the Applicant: A C Bennett SC with R J Webb