An application to register a trademark under the 1995 Act may only be made by a person who claims to be the owner of the mark. (s27). One of opposition to registration is that the trademark applicant is not the owner of the mark (S58). At common law, one of the ways you can obtain property in a trademark is by using it and acquiring a reputation in the mark. In Australia establishing ownership of an unused mark derives from a combination of authorship of the mark, an intention to use it upon or in connection with goods or services and the act of applying for the trademark. Authorship in this context doesn’t mean that the applicant invented it, or that it is novel. The Applicant need only show that they were the first to adopt it as a trademark for the goods or services. A person may take another person’s idea or design and apply to have it registered. The person who came up with the idea can’t use as a ground of opposition the fact it was their idea. On the other hand, if they can establish copyright in the mark, then this is a means by which they can challenge the registration. (see Advantage-Rent-A-Car Inc v Advantage Car Rental Pty Ltd)
If a person copies a mark from one which is in use overseas, the first applicant or user in Australia will become the recognised proprietor of the mark for the purpose of registration in Australia. Often during negotiations with foreign companies, who havn’t used their trade mark in Australia, Courts have held that Australian applicants have an entitlement to seek registration of the foreign mark in their own name. It is a case of ‘first in, first served’ and whilst it is a sharp to appropriate a trade mark from a foreign owner it is tolerated, as demonstrated in the Tastee Freez case where the Australian applicant, having registered the US Trademark was held to be entitled to ownership of it.
This practice however is not looked upon favourably by Courts who have been sympathetic to foreign owners, and indicated they are prepared to accept a minimal amount of use of a foreign trademark ‘as a trade mark’ by it’s foreign owner in Australia in order to confer ownership upon them. (see Seven Up Co v OT Ltd). In the Seven Up case, the US company were not however able to successfully obtain rectification of the register under S71 & S72 of the former Trademarks Act 1905-1936.
The High Court of Australia has held that, in the absence of fraud, an applicant can become the registered proprietor of a trade mark which has been used extensively by a foreign trader for similar goods in another country. However, this is provided that the mark hasn’t been used at all in Australia as at the date of the application for registration. At common law, the first person to use the trade mark in a country will become the proprietor of a mark there. (Re: Registered Trade Mark “Yanx”, Thunderbird Products Corp v Thunderbird Marine Products Pty Ltd) Because Courts generally frown upon this practice, they are prepared to accept either a very small amount of use of the mark in Australia by the foreign owner, or alternatively, take into account whether or not the mark has become associated in the minds of Australians with the foreign owner’s goods because of the effect of extensive advertising in publications circulated in Australia or in some other manner. There needn’t be an actual dealing with goods bearing the trade mark before there can be local use, before there can be ‘use of a trade mark’ (eg a mark used in an advertisement of goods in the course of trade – Shell Co. of Australia v Esso Standard Oil (Australia) Ltd) It is sufficient for use if imported goods that havn’t actually reached Australia have been offered for sale in Australia under the mark. Preliminary discussions and negotiations without any more about whether or not the mark will be used in Australia will not be enough.
In the Seven Up case the foreign owners were unable to have the registration expunged from the register. The situation would be different if there is some fraud or breach of confidence, or breach of contract. This underscores the importance of using ‘non-disclosure agreements’ or ‘confidentiality agreements’ in the negotiating phase.
In Moorgate Tobacco Co Ltd v Philip Morris Ltd, the parties were in negotiations over the use of the US foreign mark ‘Golden Lights’ for cigarettes, however prior to the negotiations being concluded, an application was made to register the trade mark in Australia. The US company filed an action in the High Court of Australia, contending that the mark had been used in Australia. The owner relied upon the sending of samples and advertising materials of the trade mark to Australia as constituting ‘use’ for this purpose . However the High Court rejected this activity as constituting ‘use as a trademark’. The use must consist of use in the course of trade or commerce, in accordance with the definition of a trade mark, and would be fulfilled by something such as an order for goods or an evidence of an intention to use the goods in the course of trade. One single order or sale would have sufficed to prove the requisite use. (see Thunderbird Products Corp v Thunderbird Marine Products – the sending of brochures and forwarding of a loosely assembled boat for mould making by the maker of the boat by a US company to an Australian company amount to to use of the trade mark, even though the prototype was not actually available for sale, but which was to be used by the Licensee to make boats from the mould which would be sold in Australia)
Similarly in Settef S.p.A v Rivoland Marble Company, a foreign company’s consignments of their products which beared the trade mark RIVO-LAND prominently, accompanied by brochures and explanatory literature to their Australian distributors, who in turn used the products and samples to promote their sale, was deemed to be sufficient use to establish their rights of ownership over the trade mark. Use must be demonstrated in the context of the definition of a trade mark S6(2) & S17.
Proprietorship is conferred on the first user of the mark in Australia, but that proprietorship must be in respect of the “same kind of thing”. The act relied upon to constitute ‘use’ must be such that it creates an impression that goods of a particular trader are intended to be for offered for sale in Australia. Invoices and other evidence of sale of goods must be use of the trade mark on the same goods or same kind of goods.
A foreign owner wanting to upset a registered trade mark would therefore need to present evidence of a prior transaction/s which would fall within the definition of ‘use as a trade mark’.
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