Australia: A MOTHER-load of oppositions: Energy Beverages successfully opposes trade mark application for KANGAROO MOTHER

A recent Federal Court decision between the owners of the MOTHER Mark and Kangaroo Mother Australia provides guidance for prospective trade mark owners on what to consider before applying for a trade mark.

Background

Energy Beverages (EB) is a supplier of energy drinks for the Australian market, its MOTHER energy drink was launched by Coca-Cola in 2007 and subsequently acquired by EB in June 2015. The marks of concern for this case are 1230388 (388 Mark) and 1320799 (799 Mark) collectively known as the MOTHER Marks.

Kangaroo Mother Australia (KMA) is an Australian company incorporated in 2019. It has never traded. Erbaviva Natural Care (Erbaviva) assigned its application for registration of the KANGAROO MOTHER Mark to KMA on 10 March 2020.

EB opposed the registration of the KANGAROO MOTHER Mark by KMA before the Registrar's delegate. However the delegate found that EB failed to establish any of its grounds of opposition. EB sought an appeal of the delegate's decision on the following grounds:

• S 44 – The KANGAROO MOTHER Mark was substantially identical or deceptively similar to the 388 and 799 Mark.
• S 59 – There was no intention from Erbaviva to use the mark or authorise the use of the Mark to KMA.
• S 60 – Because of the reputation of the 388 and 799 Marks, the KANGAROO MOTHER Mark would be apt to mislead consumers because of this reputation.

Decision

Section 44 – Substantially Identical or Deceptively Similar

To establish this grounds, EB had to show that the KANGAROO MOTHER Mark was substantially identical with or deceptively similar to the MOTHER Marks in relation to similar goods or closely related services.

KMA had conceded that its registration of KANGAROO MOTHER in class 32 and 5 were of similar goods to the 388 and 799 Marks.

His Honour found that the MOTHER and KANGAROO MOTHER Mark were deceptively similar. In his reasoning, O'Callaghan J outlined that the test for deceptive similarity was whether there was a real risk that KMA's use of the KANGAROO MOTHER Mark will cause a significant number of ordinary persons to wonder whether the products with the MOTHER and KANGAROO MOTHER marks come from the same source.

His Honour found that the MOTHER Mark was highly distinctive in the context of its registered goods, being non-alcoholic beverages. Hence, the addition of the word KANGAROO did not give the KANGAROO MOTHER Mark the ability to distinguish itself from the 388 and 799 Marks. The Court found that it is likely that consumers would confuse that products shown with the respective marks had come from the same source.

Section 59 – No intent to use

Section 59 provides a ground of opposition provided that the applicant had no intent to use the mark in relation to the goods specified in the application. It should be noted that given the subjective nature of intention, this ground is notoriously difficult to establish. This is further exacerbated by the Aston presumption which puts the onus of finding a lack of intention on EB.

However the evidence (or lack thereof) and arguments submitted by KMA and EB provided overwhelming reason to find that there was no intent to use by KMA. The following reasons provided by O'Callaghan J were decisive in finding there was no intent to use the KANGAROO MOTHER Mark:

• There was scarce evidence of any documentation for any intended use that went beyond a limited range of products;
• Since filing in 2019, Erbaviva or KMA have not manufactured or attempted to manufacture the goods applied for. The court noted that per Goodman Fielder v Conga Foods, a failure to use after the filing date may enable a Court to infer that there was a lack of intention;
• The sole director's correspondence in relation to the application was "conjured in a matter of minutes by cutting and pasting from the IPONZ website" which was indicative of the intention to use being merely speculative and fanciful;
• The evidence (or lack thereof) submitted by KMA amounted to no more than a claim that the court should accept at face value that KMA desired to use the mark.

Section 60 – Use likely to Deceive or Cause Confusion due to Reputation

Section 60 notes that the registration of a mark may be opposed on the basis that the use of the applicant's mark would be apt to deceive or cause confusion. O'Callaghan J inferred that the MOTHER marks had a significant reputation in Australia due to its high volume of sales and significant market share in the Australian energy drink market. This was conceded by KMA.

His Honour also found that due to the reputation of the MOTHER Mark, it is likely that the KANGAROO MOTHER Mark would be apt to mislead due to its purported registration for breakfast cereal and other cereal descriptions. O'Callaghan J found that "a lot of people" would "interchange breakfast with an energy drink". Further, the trade channels in which the MOTHER energy drinks would be distributed overlapped potentially with the KANGAROO MOTHER products which included supermarkets, retail chains, and convenience stores and petrol stations. Due to this, the court found that consumers would be given reason to wonder whether the products with the marks in question come from the same source.

Section 197 – Amendment Application by KMA

On the penultimate day of the hearing, KMA attempted to amend the class of goods in what they outlined was to narrow the issues in dispute and to inform the Court that they did not intend to press the specifications indicated in strikethrough as a matter of efficiency.

O'Callaghan J likened the power to amend an application under section 197 of the Trade Marks Act to section 105 of the Patents Act. As such the discretions in s 105 applied to 197. This required the court to assess:

• Whether there has been a full disclosure of all relevant matters;
• Whether the applicant has sought to obtain an unfair advantage from the unamended specification
• Whether there has been unreasonable delay in the amendment; and
• Whether there were any other circumstances which would lead the court to refuse the application.

Here, the evidence submitted by EB enabled the court to infer that the amendment application in respect of some of the classes of goods was to avoid the consequence of the principle that a failure in one of the classes of goods would mean the whole application failed as a whole. The application under s 197 was rejected.

Takeaways

• Trade Mark owners need to have a clear intention to use the mark as opposed to a speculative or fanciful intention to use the mark;

It would be useful for owners to assess the market and trade channel in which their marks are going to be used in and whether their use would be apt to mislead or cause confusion to consumers.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.