Pioneer Computers Australia Pty Limited v Pioneer KK  FCA 135, (February 23 2009).
The Federal Court has taken into account technological development and convergence in exercising its discretion when considering whether to remove goods and services from a registered trade mark on the grounds of non-use.
The decision is especially important because of its discussion of the circumstances in which the Court would be willing to exercise its discretion not to remove, or partially remove, a registered trade mark even if non-use of the trade mark is established.
FACTS OF THE CASE
Pioneer KK is the registered owner in Australia of the trade mark PIONEER for goods in Class 9 and services in Class 37. Pioneer Computers Australia Pty Limited (Pioneer Computers) applied to remove certain goods and certain services from the registered trade mark PIONEER on the grounds of non-use.
In proceedings before the Trade Marks Office, the Registrar's delegate found that although Pioneer KK had used its trade marks on computer peripherals, no use of the trade marks had been shown on the goods or services sought to be removed from the registrations. Even so the delegate decided that it was not viable to limit the registrations by removing those goods and services because the differences between computer goods and audio, audio-visual and home entertainment products does not allow for the drawing of “fine lines” between such goods. In exercising the discretion provided under the Trade Marks Act, the delegate concluded that the public interest was best served by not deleting the specified goods or services from the registrations.
Pioneer Computers appealed the delegate's decision and the matter came before Collier, J. of the Federal Court (Pioneer Computers Australia Pty Limited Pioneer KK (2009) FCA 135 (23 February 2009)).
In assessing Pioneer KK's use of the trade mark PIONEER the judge said that to maintain the registration of a mark in respect of a category of goods, it was not necessary to establish that the mark had been used on every type of product which might come within that particular term or description of goods. Even accepting that the term “computer peripheral devices” covered only devices connected externally to a computer, Pioneer KK had established use in the relevant period in respect of some computer peripherals, such as DVD-ROM drives, DVD writers and computer data storage jukeboxes. That, in the judge's view, was sufficient to establish Pioneer KK's right to maintain the registration in respect of the category of computer peripheral devices. According to the judge the category of computer peripherals is not closed and has changed in content since registration.
On that basis, the judge was satisfied that Pioneer KK had established use of its trade mark during the relevant period on some computer peripheral devices, namely, optical disc drives and jukeboxes, but it had not established use on any of the other goods sought to be removed. Even so, the judge's view was that there was sufficient convergence between consumer electronic products and computer products such that even though no use has been established during the relevant period across the entire category of computer peripherals, the public would still associate the PIONEER mark with Pioneer KK. However, the judge was not satisfied that the services provided by Pioneer KK extended to the services sought to be removed.
In relation to authorised use Pioneer Computers contended that use of the registered trade marks by Pioneer Australia for services provided by the Australian company did not accrue to Pioneer KK and that the mere fact that Pioneer Australia was a wholly-owned subsidiary and distributor of Pioneer KK's products did not establish any relevant control during the non-use period. However, the products sold by Pioneer Australia were created and supplied by or on behalf of Pioneer KK and, said the judge, the quality control of manufacture was exercised by the Japanese company. According to the judge, that control extended to both goods and services and the judge concluded that use of the trade marks by Pioneer Australia was under the control of Pioneer KK and authorised by it.
In considering the exercise of the Court's discretion the judge proceeded on the basis that the underlying policy of the Act was to give the Court sufficient flexibility to give effect to public interest considerations. Furthermore, it was the judge's view that use of a trade mark on closely related goods or services could be taken into account in considering the exercise of the discretionary powers conferred by the Act. The judge also accepted that the rights arising from the registration of a trade mark should not be confined to the stage of technological development of goods specified when the mark was registered.
The judge also considered that Pioneer KK's strong reputation in relation to products for the home, car and business (including computer related products and services related to those products) coupled with the concepts of brand extension and convergence would be highly likely to cause consumers to believe that there was an association with Pioneer KK and other goods sold under the name PIONEER. The judge was satisfied that both during and by the end of the relevant period, the average consumer would be familiar with the convergence of technologies and the uses to which the technologies had been put and the fact that this has enabled various manufacturers to expand their products to cover what might previously have been separate product lines of computer goods and audio-visual products. The result, according to the judge, is that consumers would be led to believe that a computer, audio-visual or multimedia product sold under the name PIONEER would be associated with Pioneer KK.
While this proposition was accepted in relation to the goods, the judge did not accept its application in relation to the services sought to be removed. Pioneer KK failed to establish use of the Pioneer KK trade marks on those services and the concepts of convergence and brand extension did not support the exercise of the discretion in favour of maintaining the registrations for those services.
According to the judge the factors in favour of maintaining the marks on the register had more to do with the public interest and the judge concluded that it was appropriate to exercise the discretion not to remove the goods. The considerations that favoured the exercise of the discretion in relation to the goods did not apply to the relevant services. On that basis the judge decided that those services should be removed from the second Pioneer KK registration.
At the end of the day, Pioneer KK was largely successful in retaining its trade mark registrations. However, Pioneer Computers achieved partial cancellation in respect of the trade mark PIONEER for certain services. The decision is especially important because of its discussion of the circumstances in which the Court would be willing to exercise its discretion not to remove, or partially remove, a registered trade mark even if nonuse of the trade mark is established.