In a recent appeal to the High Court of Australia (High Court), the High Court set aside the orders of the Full Court of the Federal Court of Australia (Full Court) and the majority held the registered trade marks ORO and CINQUE STELLE were inherently adapted to distinguish their goods permitting the marks to be maintained on the register.

Background

  • Cantarella Bros Pty Limited (Cantarella) had taken action against Modena Trading Pty Limited (Modena) for, among other things, infringement of its ORO and CINQUE STELLE trade mark registrations.
  • Modena responded by seeking cancellation of Cantarella’s trade marks on grounds the words ORO and CINQUE STELLE were not distinctive.
  • A single judge of the Federal Court refused cancellation of Cantarella’s trade marks.
  • On appeal, the Full Court ordered cancellation of the trade marks in light of the association of coffee with Italy, the Italian words ORO and CHINQUE SETLLE when translated into English mean ‘gold and ‘five star’ respectively to signify quality, there are many Italian speakers in Australia and the words have been used by other traders.

Decision of the Majority

On appeal, the only issue for determination by the High Court was whether the words ORO and CINQUE SETLLE are inherently adapted to distinguish Cantarella’s goods. The majority founds that they were.

The majority ruled that the test to determine whether a trade mark is inherently adapted to distinguish is two-fold, requiring “consideration of the ordinary signification of the words proposed as trade marks to any person in Australia concerned with the goods to which the proposed trade mark is to be applied” followed by “an enquiry… [as] to whether other traders might legitimately need to use the word in respect of their goods”[1].

The majority followed the approach undertaken by the primary judge considering the ‘ordinary signification’ of the words and found the Full Court had erred in its approach. The majority found “ORO and CINQUE STELLE… [did not] convey a meaning or idea sufficiently tangible to anyone in Australia concerned with coffee goods as to be words having a direct reference to the character or quality of the goods”[2].

The majority said, in relation to the desire of other traders to use the words, the test is “not whether traders desired to use words, English or foreign, which convey an allusive or metaphorical meaning in respect of certain goods”, the test refers to “the legitimate desire of other traders to use a word which is directly descriptive in respect of the same or similar goods”[3]. The majority found the words to be allusive rather than descriptive.

This conclusion was based on the fact the majority found the evidence was insufficient to establish that other traders would be unable to describe their products as either Italian or premium nor did the evidence establish Australian’s related to coffee understood the words to describe the character or quality of coffee. Evidence of use by rival traders was also distinguishable.

Dissent

Justice Gageler, in dissent, agreed with the Full Court and found the evidence of use supported the conclusion “gold” and “five star” are ordinary English words and when “used in respect of goods or services, they signify quality”. Justice Gageler agreed with the conclusion by the Full Court that the Italian equivalents of those words were not inherently adapted to distinguish particularly in light of the goods common association with Italy, often enough imported from Italy and sold to Italian speakers.

Practical Implications

This case illustrates how trade marks cannot be descriptive in nature however they can allude to the character and quality of the good. Additionally, this case highlights when assessing foreign words as trade marks, the same test of inherent distinctiveness applies. They will be examined as they are perceived to both traders and consumers and the perception or evidence of the use of the word in its English translation cannot necessarily be relied on.