It takes a village: Trade mark non-use case resolved by consent

A person can apply to have a registered trade mark removed for “non-use”.  The owner of the mark bears the onus of adducing evidence of its use of the mark (in the relevant period) in connection with the goods and services included in its registration.

A mark is taken to have been used when it functions as a badge of origin, to distinguish the goods or services provided in the course of trade.  By way of example, the Nike “swoosh” logo is used when it appears on a pair of shoes, or on marketing materials promoting the sale of shoes.

Use as a trade mark also includes circumstances where the registered owner authorises another person to use the mark, subject to the owner retaining sufficient control of the use.

A successful non-use application can result in the trade mark being removed from the register.  VUR Village Trading No 1 Limited (VUR) brought such an application against Village Roadshow IP Pty Ltd (Village Roadshow).  VUR’s application concerned Village Roadshow’s registrations of the below trade mark in classes 9, 35 and 41:

VUR claimed Village Roadshow had not used the trade mark with respect to goods and services listed in classes 9, 35 and 41 between 6 August 2016 and 6 August 2019. 

VUR’s application was initially successful, with the Registrar’s delegate deciding that:

• the registration in class 9 be removed in its entirety; and
• the registrations in classes 35 and 41 be partially removed, only with respect to certain services.

Village Roadshow appealed to the Federal Court of Australia.  VUR then cross-appealed, challenging the decision to only partially remove the registrations under classes 35 and 41

On the eve of trial, the parties notified the Federal Court that they were negotiating a settlement, resulting in the trial being adjourned.  The parties subsequently informed the Federal Court that an agreement had been reached and that they would consent to orders setting aside the delegate’s original decision to remove (both wholly and partially) Village Roadshow’s registrations. 

Although the parties (including the Registrar) had agreed, the Federal Court was still required to consider whether it was appropriate to make orders setting aside the original decision, without the matter being determined on the merits.  To that end, the Federal Court considered the public interest in maintaining the integrity of the trade mark register.  The Federal Court observed that it is in the interests of consumers for unused trade marks to be removed from the register.

In any event, the Federal Court determined that it was appropriate to make the orders agreed to by the parties, in light of:

1. VUR’s consent to the orders;
2. the Registrar’s decision not to oppose the making of the orders; and
3. the new evidence of use produced by Village Roadshow, which VUR accepted would likely enliven the discretion to allow the trade marks to remain on the register. 

Lavan comment

Although Village Roadshow was ultimately successful in defending its trade marks, it endured legal costs and uncertainty before resolving the matter by consent.  Had Village Roadshow been able to produce better evidence before the Registrar’s delegate, then the need to appeal to the Federal Court may not have arisen.  This speaks to the importance of keeping up-to-date records of your trade mark usage, in case you are required to respond to a non-use application at short notice.

From VUR’s perspective, its initial success was short-lived.  An appeal to the Federal Court is a hearing de novo, meaning that the Court hears the matter afresh, rather than merely reviewing the Registrar’s original decision.  This allowed Village Roadshow to put on new evidence, which appears to have put the question of “non-use” beyond doubt.

Finally, the case is a timely reminder that the Court must be satisfied it is proper to make orders, even when agreed by consent.  Although the Court ultimately agreed to make the orders in this case, parties ought to be prepared to persuade the Court when filing a minute of consent orders, including by preparing written submissions.

If you require assistance or advice in relation to trade marks, do not hesitate to contact Iain Freeman or Andrew Sutton.

Thank you to Freya Surma-Litchfield, Solicitor, for their valuable research and assistance with this article.

Disclaimer

The information contained in this publication does not constitute legal advice and should not be relied upon as such. You should seek legal advice in relation to any particular matter you may have before relying or acting on this information. The Lavan team are here to assist.

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