Energy Beverages LLC v Frucor Suntory New Zealand Ltd

• Jurisdiction: New Zealand
• Judge: Brown J
• Judgment Date: 11 November 2022
• Neutral Citation: [2022] NZCA 536
• Docket Number: CA38/2021
• Court: Court of Appeal
• Year: 2022

Between

Energy Beverages LLC

Appellant

and

Frucor Suntory New Zealand Limited

Respondent

[2022] NZCA 536

Court:

Cooper, Brown and Courtney JJ

CA38/2021

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

Intellectual property appeal against decision declining to remove a trade mark on the grounds oof non-use and that it was a sign — seven year limitation period for challenge — colour mark — effect of the use of the adjective “predominant” — Trade Marks Act 2002

Counsel:

G F Arthur KC, R C Watts and A N Birkinshaw for Appellant

A H Brown KC, A E Isaacs and S Aymeric for Respondent

The appeal was dismissed.

• A The appeal is dismissed.

• B The appellant must pay the respondent costs for a standard appeal on a band A basis and usual disbursements. We certify for second counsel.

JUDGMENT OF THE COURT

Table of Contents

	Para no
Introduction	[1]
Obtaining and removing registered trade marks	[5]
Registration	[5]
Invalidity	[10]
Revocation	[12]
Factual background	[13]
The Assistant Commissioner's decisions	[19]
The use challenge	[20]
The validity challenge	[22]
The High Court judgment	[25]
The validity challenge	[25]
The use challenge	[30]
The issues on appeal	[34]
Issue 1: Did the Judge err in holding that the time bar in s 75 prevents a challenge to the Registration under s 18(1)(a)?	[35]
Issue 2: Does the use of the phrase “predominant colour” cause the Registration to be unclear and for more than one sign?	[55]
The contest	[56]
The law and practice governing trade mark applications	[61]
(a) A representation of the trade mark	[61]
(b) Colour marks	[66]
The chronology of the application for TM 795206	[69]
The meaning of “predominant”	[74]
(a) Quantitative analysis	[79]
(b) Qualitative assessment	[82]
Whether a registration may cover multiple signs?	[90]
Issue 3: Did the Judge err in holding that the Registration should be interpreted as being defined by the written description of the colour on the register, namely Pantone 376C?	[107]
Issue 4: Does the difference between the darker shade of green in the image on the register and written description Pantone 376C mean the Registration is ambiguous and too imprecise?	[117]
Result	[118]

REASONS OF THE COURT

(Given by Brown J)

Introduction

1 Trade mark 795206 1 of the respondent (Frucor) was registered on 23 June 2012 2 (the Registration) as a representation comprising a swatch of green colour together with the following explanation: 3

- The mark consists of the colour green (Pantone 376c), as shown in the representation attached to the application, applied as the predominant colour to the goods, their packaging or labels. Section 18(2) of the Trade Marks Act 2002 applies.

2 However the scan by the Intellectual Property Office of New Zealand (IPONZ) of the green metal specimen affixed to the paper application generated a different shade of green from Pantone 376C. The different shades are as follows:

3 The appellant, Energy Beverages LLC (EBL), applied:

(a) on 20 June 2017 for revocation of the Registration on the ground of non-use of the colour green appearing in the representation on the register; and

(b) on 8 August 2017 for a declaration that the Registration was invalid on the ground that it comprised a sign that did not qualify as a trade mark.

Both applications sought removal of Frucor's trade mark from the register of trade marks.

4 Those applications were declined by the Assistant Commissioner of Trade Marks. 4 EBL's appeal in the High Court was dismissed. 5 EBL now appeals on both its non-use and invalidity contentions. Frucor supports the judgment both in its terms and on other grounds.

Obtaining and removing registered trade marks

Registration

5 The definition of “trade mark” in s 5(1) of the Trade Marks Act 2002 (the Act) states:

trade mark—

(a) means any sign capable of—

(i) being represented graphically; and

(ii) distinguishing the goods or services of one person from those of another person; …

…

6 A “sign” is defined in s 5(1) as including:

(a) a brand, colour, device, heading, label, letter, name, numeral, shape, signature, smell, sound, taste, ticket, or word; and

(b) any combination of signs.

7 An application for registration must contain a clear representation of the trade mark. 6 Regulation 44(g) of the Trade Marks Regulations 2003 (the 2003 Regulations) provides that if the trade mark is a colour or colours an applicant must supply a description acceptable to the Commissioner of Trade Marks of the colour or colours before their application can be accepted.

8 Part 2 of the Act contains several provisions which preclude the Commissioner from registering trade marks. Of significance for this case are ss 17 and 18. Section 17 materially states:

17 Absolute grounds for not registering trade mark: general

(1) The Commissioner must not register as a trade mark or part of a trade mark any matter—

(a) the use of which would be likely to deceive or cause confusion; or

(b) the use of which is contrary to New Zealand law or would otherwise be disentitled to protection in any court; or

(c) the use or registration of which would, in the opinion of the Commissioner, be likely to offend a significant section of the community, including Māori.

(2) The Commissioner must not register a trade mark if the application is made in bad faith.

…

Section 18 provides:

18 Non-distinctive trade mark not registrable

(1) The Commissioner must not register—

(a) a sign that is not a trade mark:

(b) a trade mark that has no distinctive character:

(c) a trade mark that consists only of signs or indications that may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin, time of production of goods or of rendering of services, or other characteristics of goods or services:

(d) a trade mark that consists only of signs or indications that have become customary in the current language or in the bona fide and established practices of trade.

(2) The Commissioner must not refuse to register a trade mark under subsection (1)(b), (c), or (d) if, before the date of application for registration, as a result of either the use made of it or of any other circumstances, the trade mark has acquired a distinctive character.

9 On registration of a trade mark the Commissioner must enter on the register the actual date of registration and the deemed date of registration 7 and, in the case of an application for the registration of a series of trade marks, must register the trade marks as a series in one registration. 8 The register 9 is prima facie evidence of

any matters required or authorised by or under the Act to be entered in it. 10

The contents of the register are prescribed by s 182 of the Act.

Invalidity

10 The power to remove an invalidly registered trade mark is provided in s 73 of the Act:

73 Invalidity of registration of trade mark

(1) The Commissioner or the court may, on the application of an aggrieved person (which includes a person who is culturally aggrieved), declare that the registration of a trade mark is invalid to the extent that the trade mark was not registrable under Part 2 at the deemed date of its registration.

(2) Despite subsection (1), the registration of a trade mark that has acquired a distinctive character after its registration must not be declared invalid even though the trade mark was not registrable under section 18(1)(b), (c), or (d) at the deemed date of its registration.

…

11 However, after seven years from the date of application for registration certain trade marks are presumptively valid. Section 75 states:

75 Presumption of validity of registration of trade mark

The registration of a trade mark is, after the expiration of 7 years from the deemed date of registration, deemed to be valid unless—

(a) the registration was obtained by fraud; or

(b) the trade mark should not have been registered on any of the grounds set out in section 17( 1) or (2); or

(c) the registration may be revoked on any of the grounds set out in section 66.

Revocation

12 Validly registered trade marks may be revoked on various grounds prescribed in s 66 of the Act. One such ground is that at no time during a continuous period of three years or more was the trade mark put to genuine use in the course of trade in

Factual background

13 A paper application to register a shade of green as a trade mark was received by IPONZ from Frucor on 29 August 2008 by post. The application comprised a paper form with a green coloured metal specimen (the colour swatch) stapled to that form. It was date-stamped 29 August 2008 by IPONZ and allocated the trade mark application number 795206.

14 What next occurred is conveniently recorded in a written statement of the Commissioner: 12

5. At the time application no. 795206 was lodged, IPONZ was transitioning to a paper-less system. Part of the transition involved digitalising physical applications received. In accordance with digitalisation process, the paper application (TM application no. 795206) was scanned along with the attached metal specimen of the mark on 2 September 2008.

6. The application was examined on the basis of the application as it appeared digitally on the IPONZ online system after scanning and in conjunction with the other material provided, including the Pantone reference for the colour in the metal swatch.

7. [Frucor] submitted evidence in support of registration on 5 August 2009, 8 July 2010 and 18 March 2011 in physical form. The evidence included a physical sample of [Frucor's] aluminium can packaging featuring the colour to be registered as a trade mark along with print outs of photographs and other printed promotional materials. The examiner was satisfied that the...