In Australia, the Registrar has the discretion to revoke acceptance of an Application for Registration of a Trade Mark in terms of Section 38 of the Trade Marks Act 1995 (“the Act”) if he or she is satisfied that the Application: (a) should not have been accepted; and (b) that it is reasonable to revoke the acceptance, taking into account all of the circumstances.
It is worth bearing this discretionary power of the Registrar in mind in Opposition Proceedings against a Trade Mark Application, particularly in circumstances where the accepted Mark is contained wholly within an earlier registration.
An example of a typical circumstance in which Section 38 is applicable arose in recent Opposition Proceedings at the Australian Trade Marks Office against Trade Mark Application No. 1597007 (“the Application”) for TASMAN, which was filed in the name Endeva Pty Ltd (“the Applicant”).
The Application was filed in Class 25 for apparel (“clothing, footwear, headgear”), and claimed a priority date of 18 December 2013. After examination, a clear Report issued on 16 January 2014 indicating that the Application had been accepted. Acceptance was advertised on 8 May 2014. Winterworth Pty Ltd (“the Opponent”) filed a Notice of Intention to Oppose on 8 July 2014, followed by its Statement of Grounds and Particulars on 8 August 2014.
In the meantime, a Notice of Intention to revoke the acceptance of the Application (“the Notice”) was sent to the Applicant on 9 July 2014, stating that the Examiner had not taken into consideration an earlier registration, Trade Mark Registration No. 1452777 (“the earlier registration”):
The earlier registration included the word “TASMAN”, and was considered to claim the same or similar goods in Class 25 to that of the Application. Accordingly, the Registrar considered revocation of acceptance to be reasonable, in view of the earlier registration and the surrounding circumstances. The matter proceeded to a Hearing.
Since the Hearing related to the Notice, only the Applicant (and not the Opponent) was required to provide submissions. However, the Delegate was not persuaded by any of the Applicant’s arguments, and revoked acceptance of the Application. The Delegate also directed that the Application undergo re-examination once the period for appeal had expired.
Exercising the discretion to revoke acceptance
The discretion of the Registrar to revoke the acceptance of an Application for registration is defined in Section 38 of the Act as requiring two factors:
- First limb of the test: Was there a valid ground for rejecting the Application?
After reviewing the examination file of the Application, the Delegate concluded that the search strategy used by the Examiner should have located Trade Mark No. 1452777 and extracted it for consideration. However, there was no record that this had been done by the Examiner.
The earlier registration included the word TASMAN and was filed for similar goods in Class 25. The Delegate considered that there was a valid ground for rejecting the Application during the examination process in that the Mark was substantially identical with, or deceptively similar to, the earlier registration in terms of Section 44 of the Act.
The Applicant argued that TASMAN was sufficiently different to the early registration, which included the term “UGG” in prominent and distinctive font. It was submitted that the recognisability of the term “UGG” in Australia was such that it overshadowed the other components of the Mark of the earlier registration. The Applicant also argued that the use of the term TASMAN in the earlier registration was likely to suggest a geographical origin of the products.
In contrast, the Applicant argued that TASMAN was a “portmanteau” word. That is, the Mark was a compounded word made up of the shortened version of “Tasmania” and “man.” It was also brought to the Delegate’s attention that a number of Trade Marks containing the word TASMAN already co-exist on the Registrar, so that there could be no deceptive similarity of the respective Marks.
The Delegate was not persuaded by these arguments and stated that she was satisfied that a likelihood of confusion existed. The additional components in the earlier registration were not considered to be sufficient to differentiate the Marks from each other.
- Second limb of the test: is it reasonable to revoke acceptance?
Taking into account the search strategy of the Examiner that failed to locate the earlier registration, the Delegate took the view that information had been overlooked which, had it been properly considered, would have resulted in a valid ground for rejection being raised.
The Applicant argued that the dispute between the parties would be better served in the forum of Opposition Proceedings. The Delegate did not accept this view and, on balance, considered that it would be preferable to exercise the discretion under Section 38 as the matter was still in its early stages.
There are not many instances in which the discretion under Section 38 has been applied. Circumstances in which Section 38 may be applicable include: where the Application has been accepted due to an administrative error or oversight by an Examiner of the Australian Trade Mark Office during the examination process, such as: (a) the appropriate research not being carried out; (b) an inappropriate search strategy being used; or (c) where an application is accepted because a citation was missed due to an indexing error.
Many of these circumstances are outside of the control of the Applicant. However, in arguing against a Notice to revoke acceptance, an Applicant needs to put forward arguments for both limbs of the test. That is, that no valid ground to reject the application existed at the time of acceptance, but also that it is not reasonable to revoke acceptance in the circumstances. Arguments against a Section 38 Notice include where the basis of the revocation merely amounts to a change of opinion or where the balance of convenience favours the Applicant.