CUB Pty Ltd v Elixir Signature Pty Ltd [2013] ATMO 74

Intellectual Property Development Corporation Pty Ltd v CUB Pty Ltd [2013] ATMO 73

Recent trade mark removal and opposition proceedings between two Australian breweries involving 59 heritage beer trade marks provides a useful discussion of when the Registrar may exercise her discretion under the Trade Marks Act to allow unused marks to remain registered and the considerations in relation to reapplying to register marks which are not in use.

In the highly-publicised proceedings, Elixir Signature Pty Ltd (trading as Thunder Road Brewing Company) sought removal on grounds of non-use of 53 registered trade marks owned by one of Australia's largest breweries, CUB Pty Ltd (formerly Fosters Australia Limited) and on grounds of lack of intention to use against one trade mark registration.  The removal proceedings were heard concurrently with five-related oppositions lodged by Intellectual Property Development Corporation Pty Ltd ("IPDC") against five trade mark applications filed by CUB.

See DCC's full summary of the decisions here

Historic beer brands challenged by local brewery

Elixir, the company behind a small Melbourne-based brewery, Thunder Road Brewing, is a member of the ICB Group of companies operating an import/export business in Australia, New Zealand, Europe, the USA, South Africa and throughout Asia including in the brewing industry.  IPDC is an IP holding company within the ICB Group.

CUB is one of Australia's leading brewers with a history going back to 1824.  Its evidence in the proceedings read like a history of brewing in Australia, detailing its expansionary business path and the acquisition of various competing businesses and their brands.

The evidence showed that the majority of the beer trade marks have long since fallen into disuse (some having not been used for over 50 years) for various commercial reasons.  However, where marks had not been used for some time, CUB's evidence sought to show that the relevant marks retained a residual reputation or that CUB had a continuing intention to use the marks, in particular highlighting that some of the marks had previously been used by CUB to commemorate special events and that it had plans to use some of the trade marks in a similar way in the future.

The registrar's discretion to allow unused marks to remain registered

The decisions are critical reading for the owners of trade marks which are not in use, but which may still have a reputation or, at the very least, some ongoing commerical value.  The decisions canvass the relevant considerations in relation to the exercise of the Registrar's Discretion as to whether to maintain unused trade marks.  They also deal with important issues in relation to who bears the onus in demonstrating an intention to use a trade mark and when an application to register a trade mark may have been filed in bad faith.  A detailed summary of the decisions is available on DCC's website HERE.

CUB's marks remain registered despite non-use

In the removal proceedings, CUB succeeded in maintaining the majority of its registrations in spite of not having used the marks.  CUB demonstrated a strong residual reputation in many of the marks and ongoing private interests in using the marks in the future.  Elixir's mere desire to use the marks was not sufficient to displace that interest.  Indeed, the Delegate recognised that beer drinkers can be quite partisan, noting that where there is a geographical reference in a brand, it is likely to serve to maintain the reputation of that brand longer than would otherwise be expected.  Further, the Delegate concluded that if these heritage beer brands were used, the buying public would expect that beer to be made in accordance with the original historical recipe to the extent possible and failure to meet this requirement would be somewhat misleading.

In the related opposition proceedings, the Delegate was not prepared to draw an adverse inference that CUB's applications had been filed in bad faith merely because they were filed as a defensive tactic and in response to IPDC's interest in using the marks.  Rather, the Delegate considered the inference to be drawn was that IPDC knew that CUB was the legal owner of the marks as it had approached CUB to acquire or license use of the marks and noted that no evidence had been provided to show that CUB (or a reasonable man in its shoes) should not have applied for the Trade Marks.  Further, the Delegate was not satisfied that IPDC had shifted the onus to the Applicant to demonstrate an intention to use the mark, as it had only made mere allegations rather than a prima facie case.

Key lessons for trade mark owners

The key lessons for the trade mark owner to be drawn from this decision are as follows:

  • A residual reputation in a trade mark may provide a basis for exercising the Registrar's discretion to maintain a trade mark in spite of non-use.
  • A risk of consumer confusion is an important public interest consideration when exercising the Registrar's discretion to maintain a trade mark in spite of non-use.
  • Trade marks containing geographical place names used for beer may have greater residual reputation in light of the partisan nature of beer drinkers.
  • A removal applicant's private interest in using a trade mark may be weighed against risk of confusion and potential loss of goodwill.
  • Use of marks within a family of trade marks may provide a basis to maintain registrations for other marks in that family which are not in use if consumer confusion may arise.
  • A mere desire to maintain a registration is not considered a sufficient reason to exercise the Registrar's discretion.
  • The onus is with an opponent to demonstrate why an application has been filed in bad faith or that the applicant does not have an intention to use the relevant mark.