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It may glibly be said that if an Australian trade mark has not been used during the previous 3 years, in relation to the goods and services and in respect of which it is registered, then its registration may be challenged through an application for removal for non-use. In the 12 November 2021 decision in Freshfood Holdings Pte Ltd v Pablo Enterprise Pte Ltd (No 2) [2021] FCA 1404, the Federal Court of Australia dealt with the question of whether it should exercise its discretion under section 101(3) of the Trade Marks Act 1995 (Cth) (Act) not to remove the trade mark, notwithstanding the absence of relevant use.

is the trade mark still fresh?

Freshfood Holdings (Freshfood) and its predecessors in title had owned the registered trade mark “PABLO”, in relation to coffee, since 1961. The mark had been used extensively from the 1960s to 1990s, but there had been no sales since 2009.

Pablo Enterprise (Pablo) applied under section 92(4)(b) of the Act for removal of the “PABLO” mark on the basis that it had not been used during the relevant period of 28 April 2016 to 28 April 2019 (relevant period). Though Freshfood opposed Pablo’s application, the Registrar of Trade Marks found in Pablo’s favour in determining to remove the mark.

Freshfood appealed the decision to the Federal Court of Australia, for what is a de novo determination of the matter, rather than a consideration of and determination on alleged errors by the Registrar. For reasons unknown, Pablo did not participate in the appeal, though it had appeared at the original hearing before the Registrar.

was the trade mark used?

Freshfood had been unable to demonstrate sales of “PABLO”-branded coffee during the relevant period. While Freshfood’s CEO had alleged export sales to New Zealand, PNG and Pacific islands during the relevant period, the court dismissed this evidence on the basis that there would have been documentation of such sales; Freshfood presented no documentation.

While there was a sign at Freshfood’s manufacturing premises displaying a number of brands including “PABLO”, the court concluded that there was no use of the mark during the relevant period. There was no endeavour being made to trade in “PABLO”-branded coffee.

should discretion be exercised?

In deciding whether to exercise the court’s discretion under section 101(3) not to remove the mark, Thawley J cited with approval the considerations set out by the Full Court of the Federal Court of Australia in PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd (2021) 391 ALR 608.

Namely whether or not:
1. there has been abandonment of the mark;
2. the proprietor still has residual reputation in the mark;
3. there have been sales since the relevant period ended;
4. the removal applicant had entered the market in knowledge of the registered mark;
5. the registered proprietor was aware of the applicant’s sales under the mark.

The burden is on the removal opponent to show that removal is not reasonable at the time the decision is made. Relevantly:

  • Freshfood had not abandoned the mark, as subsequent sales demonstrated;
  • 500 kg of coffee bearing the mark was exported to New Zealand less than 3 months after the end of the relevant period. Further sales ensued in Australia, including ongoing supply contracts signed in 2021;
  • Freshfood had residual reputation in the “PABLO” mark due to its historical use.

In light of this evidence, and Pablo’s non-participation in the proceedings, Freshfood’s appeal was allowed.

lessons

Even if the owner has not used its mark, it is still important for both sides to address the question of the section 101(3) discretion – it may be decisive. The case also illustrates that unused marks can be successfully defended against non-use removal in certain circumstances.

If any of the above raises questions, the IP team at Macpherson Kelley can assist you with all of your trade mark needs.

This article originally appeared in World Trademark Review on 24 November 2021.

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keeping a trade mark ‘fresh’: the onus is on the opponent

24 January 2022
nils versemann

It may glibly be said that if an Australian trade mark has not been used during the previous 3 years, in relation to the goods and services and in respect of which it is registered, then its registration may be challenged through an application for removal for non-use. In the 12 November 2021 decision in Freshfood Holdings Pte Ltd v Pablo Enterprise Pte Ltd (No 2) [2021] FCA 1404, the Federal Court of Australia dealt with the question of whether it should exercise its discretion under section 101(3) of the Trade Marks Act 1995 (Cth) (Act) not to remove the trade mark, notwithstanding the absence of relevant use.

is the trade mark still fresh?

Freshfood Holdings (Freshfood) and its predecessors in title had owned the registered trade mark “PABLO”, in relation to coffee, since 1961. The mark had been used extensively from the 1960s to 1990s, but there had been no sales since 2009.

Pablo Enterprise (Pablo) applied under section 92(4)(b) of the Act for removal of the “PABLO” mark on the basis that it had not been used during the relevant period of 28 April 2016 to 28 April 2019 (relevant period). Though Freshfood opposed Pablo’s application, the Registrar of Trade Marks found in Pablo’s favour in determining to remove the mark.

Freshfood appealed the decision to the Federal Court of Australia, for what is a de novo determination of the matter, rather than a consideration of and determination on alleged errors by the Registrar. For reasons unknown, Pablo did not participate in the appeal, though it had appeared at the original hearing before the Registrar.

was the trade mark used?

Freshfood had been unable to demonstrate sales of “PABLO”-branded coffee during the relevant period. While Freshfood’s CEO had alleged export sales to New Zealand, PNG and Pacific islands during the relevant period, the court dismissed this evidence on the basis that there would have been documentation of such sales; Freshfood presented no documentation.

While there was a sign at Freshfood’s manufacturing premises displaying a number of brands including “PABLO”, the court concluded that there was no use of the mark during the relevant period. There was no endeavour being made to trade in “PABLO”-branded coffee.

should discretion be exercised?

In deciding whether to exercise the court’s discretion under section 101(3) not to remove the mark, Thawley J cited with approval the considerations set out by the Full Court of the Federal Court of Australia in PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd (2021) 391 ALR 608.

Namely whether or not:
1. there has been abandonment of the mark;
2. the proprietor still has residual reputation in the mark;
3. there have been sales since the relevant period ended;
4. the removal applicant had entered the market in knowledge of the registered mark;
5. the registered proprietor was aware of the applicant’s sales under the mark.

The burden is on the removal opponent to show that removal is not reasonable at the time the decision is made. Relevantly:

  • Freshfood had not abandoned the mark, as subsequent sales demonstrated;
  • 500 kg of coffee bearing the mark was exported to New Zealand less than 3 months after the end of the relevant period. Further sales ensued in Australia, including ongoing supply contracts signed in 2021;
  • Freshfood had residual reputation in the “PABLO” mark due to its historical use.

In light of this evidence, and Pablo’s non-participation in the proceedings, Freshfood’s appeal was allowed.

lessons

Even if the owner has not used its mark, it is still important for both sides to address the question of the section 101(3) discretion – it may be decisive. The case also illustrates that unused marks can be successfully defended against non-use removal in certain circumstances.

If any of the above raises questions, the IP team at Macpherson Kelley can assist you with all of your trade mark needs.

This article originally appeared in World Trademark Review on 24 November 2021.