The High Court has handed down its eagerly awaited decision on the distinctiveness of the trade marks CINQUE STELLE and ORO (owned by Cantarella Bros Pty Ltd), finding that the trade marks are 'inherently adapted to distinguish' and therefore should remain on the trade marks register. This overturns the decision of the Full Court of the Federal Court of Australia and affirms the first instance decision by Justice Emmett. Associate, Megan Comerford, outlines the decision.

Background

Cantarella Bros Pty Ltd (Cantarella) (the company behind the famous Vittoria brand) owned the registered trade marks "ORO" and "CINQUE STELLE" in relation to coffee products. Cantarella alleged that Modena Trading Pty Ltd (Modena) was infringing those registered trade marks on its Caffe Molinari range of products. Modena challenged the validity of Cantarella’s registrations on the basis that the trade marks were not inherently adapted to distinguish the goods or services of Cantarella from those of other traders, because the words were descriptive of the goods they were applied to - “oro” is Italian for “gold” and “cinque stelle” means “five stars”.

At first instance, Justice Emmett found that the marks were inherently adapted to distinguish as required by section 41(3) of the Trade Marks Act 1995, because “the Italian words are not so obvious to ordinary English speaking persons in Australia that Cinque Stelle and Oro have a specific meaning”. Cantarella succeeded in establishing trade mark infringement, and Modena failed in its invalidity claim.

Modena appealed to the Full Federal Court, which overturned the original decision, primarily on the basis that the marks could not be regarded as distinctive to coffee traders and suppliers, a substantial number of whom would be aware of the Italian translation. As we reported, the Full Court ordered that the Cantarella trade marks be removed from the register.

The High Court granted Cantarella special leave to appeal in March 2014.

Incorrect filter applied by Full Court

The majority of High Court agreed with Justice Emmett, overturning the Full Federal Court’s decision and ordering that the first instance decision stand (meaning that the trade marks remain on the register, and Modena has infringed the trade marks).

Chief Justice French and Justices Hayne, Crennan and Kiefel, in the majority, found that the test of distinctiveness requires, firstly, a determination of the “ordinary signification” of a word to any person concerned with the goods to which the trade mark is applied (that is, “anyone ordinarily purchasing, consuming or trading in the relevant goods”). Then, once the “ordinary signification” of the word is established, the second consideration is whether other traders might legitimately need to use the word in respect of their own goods. In making this finding the High Court rejected outright the approach of the Full Court, which had held that the test for distinctiveness should be solely focussed on those who trade in the relevant goods or services.

Non parlo Italiano

Their Honours held that the evidence did not show that the words 'Cinque Stelle' and 'Oro' conveyed “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”. Although the majority accepted Modena’s evidence that ‘Cinque Stelle’ and ‘Oro’ had been used by traders other than these parties in relation to coffee products, that evidence fell short of establishing that the words were “'understood in Australia by persons concerned with coffee products to be directly descriptive of the character or quality of such goods”. (emphasis added)

This is particularly interesting given some of the evidence considered by Justice Emmett at first instance, including the 2006 Census which showed that Italian was the second-most spoken language in Australia. Despite this, it was nevertheless held that the meanings of the words would only be understood to a small minority of English-speaking people in Australia.

Smooth aftertaste for foreign brand owners

In the context of increased global trade, the High Court’s decision is a helpful one for foreign brand owners seeking to protect their trade mark rights in Australia, and for Australian businesses using foreign words as trade marks.

Short shot: register your trade marks!

Although Cantarella ultimately succeeded in its claim for infringement of its registered trade marks, its claims for misleading and deceptive conduct and passing off against Modena failed back at first instance, because Modena also used its CAFFE MOLINARI branding on its products.