Section 62A of the Australian Trade Marks Act provides that the
registration of a trade mark may be opposed on the ground that the
application was made in "bad faith". This is a relatively
new ground of opposition (applying to trade mark applications
accepted on or after 23 October 2006) and we have this year seen
the first substantive decisions from IP Australia on this
In Hard Coffee Pty Limited v Hard Coffee Main Beach Pty
Limited  ATMO 26 (1 April 2009), Hard Coffee Pty Limited
("Hard Coffee") successfully opposed applications to
register "HARDCOFFEE MAIN BEACH" and
"HARDCOFFEE" in classes 30 and 43 for coffee related
beverages and coffee shop services. Hard Coffee had sold one of its
coffee shops to M.B Raymond & Co Pty Limited and the director
of this company, Mr Raymond, was also the director of the applicant
company, Hard Coffee Main Beach Pty Limited. The contract of sale
between Hard Coffee and M.B Raymond & Co Pty Limited expressly
stated that Hard Coffee retained ownership of the intellectual
property in the HARD COFFEE name.
The hearing officer was of the view that the applications were
filed "in the face of rights that Mr Raymond had previously
acknowledged" and that, having signed the contract of sale, Mr
Raymond had a responsibility not to file the applications.
The hearing officer held that to demonstrate "bad
faith", there would need to be:
an element of intentional dishonesty; or
a deliberate attempt to mislead the Registrar in some way by
means of the application; or
in circumstances where an applicant claims that the application
was not made in bad faith but, rather, as a result of its own
ignorance or naivety, then the evidence would need to show that the
circumstances were such that the "reasonable man"
standing in the shoes of the applicant, should be aware that he
ought not to apply for trade mark registration.
The hearing officer emphasised that the onus of demonstrating
"bad faith" falls squarely on the party making the
allegation. If, however, the opponent submits sufficient evidence
to establish bad faith on the balance of probabilities, the onus
shifts to the applicant. In this opposition, the applicant did not
file any evidence or submissions in response to the opponent's
evidence in support of the opposition. This failure to file
evidence in answer was considered by the hearing officer to
strengthen the opponent's case of bad faith.
In Bombala Council v Peter Wilkshire  ATMO 33 (26 May
2009), the hearing officer adopted the "HARD COFFEE"
approach, noting that this approach is broadly consistent with that
adopted in the UK. The hearing officer considered the history of
dealings between the applicant and the opponent, including the
settlement of Federal Court proceedings, and concluded that the
applicant had applied to register a mark which he had previously
recognised as the property of another. The hearing officer was
satisfied that circumstances were such that a "reasonable
person" standing in the shoes of the applicant would have been
aware that he/she ought not to apply for trade mark
Madderns has recently been successful in establishing "bad
faith" in an opposition filed on behalf of our client, Clipsal
Australia Pty Ltd. The delegate referred to both Hard Coffee and
Bombala Council and concluded that the evidence filed by Clipsal
Australia Pty Ltd had made out a prima facie case under section 62A
such that a plain and direct response from the applicant was
required. The applicant chose not to challenge or dispute the
opposition in any way and the hearing officer considered that such
silence "... is eloquent".
These decisions suggest that, for opponents, it is important to
present sufficient evidence to establish bad faith on the balance
of probabilities, assessed by reference to a "reasonable
person" test, so that the onus then shifts to the applicant.
For applicants, it is important to respond to any evidence of
"bad faith" or run the risk that silence may be construed
as supporting the opponent's case.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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