Mastronardi Produce Ltd v Registrar of Trade Marks [2014] FCA 1021 (Mastronardi)
In the Mastronardi decision handed down on 19 September 2014, Justice Gordon in the Victorian Division of the Federal Court of Australia had cause to consider the scope and operation of section 41 of the Trade Marks Act 1995 (Act), which has been the source of much judicial debate.
The case concerned an appeal from the Delegate of the Registrar of Trade Marks (Delegate), who had rejected trade mark application 1438732 (Application). The Application had been made for the word ”ZIMA” in class 31, in respect of a variety of tomatoes known as the ”golden grape".
Facts of the case and basis of appeal
Mastronardi Produce Ltd (Appellant) is a Canadian company that produces and distributes fruit and vegetables. As part of their business, they supply seeds and licences to grow unusual and distinctive products. When they do this, it is their practise to market them under registered trade marks.
In 2010 the Appellant’s president came up with the name ZIMA, to be used to market a range of tomatoes. The word had no meaning in the English language before that time. In 2011, it was registered as a trade mark in Canada, the United States, Japan and New Zealand.
The Appellant applied to register it as a trade mark in Australia in 2011, at which point, no ZIMA tomatoes had yet been marketed or sold (in fact none were sold until October 2013).
Section 47 of the Act relevantly provides that:
(2) an application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods… in respect of which the trade mark is sought to be registered (designated goods) from the goods of other persons.
(3) In deciding the question whether or not a trade mark is capable of distinguishing the designated goods…from the goods…of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods…from the goods…of other persons.
The Application was rejected by the Delegate of the Registrar of Trade Marks (Respondent) because:
the word ZIMA appeared to be a reference to a single kind of tomato plant and its fruit;
the Application lacked any inherent adaptation to distinguish the Appellant’s tomatoes.
The Delegate rejected the Application pursuant to s 41(2) of the Act, which is entitled “Trade mark not distinguishing applicant’s goods or services”.
In other words, the Application was rejected on the grounds that the trade mark would be used to describe a type of product, rather than in connection with the marketing and sale of the Appellant’s product.
The Appellant appealed from the Delegate to the Federal Court under s 35 of the Act. Such appeals are conducted on a de novo basis.
The issue on appeal was whether the word ZIMA was inherently adapted to distinguish the Appellant’s tomatoes from the tomatoes of other traders, such that it would be registrable under s 41(3) of the Act, and to that end there were two questions:
1) how would ZIMA have been understood as at 25 July 2011 by ordinary Australians, seeing as it was the first time the word had been used; and
2) how likely was it that other persons trading in tomatoes and being actuated only by proper motives would think of the word ZIMA and want to use it in connection with tomatoes in a manner which would infringe a registered trade mark granted to the Appellant.
The parties’ arguments
The Respondent argued that the Appellant intended to use ZIMA to distinguish a particular kind of tomato, and not as a trade mark to distinguish its tomatoes from that of other traders. The effect of this would be that, by using the trade mark to describe the type of goods, rather than merely their products, the trade mark could not be inherently adapted to describe the goods for which it was registered.
Therefore if the Appellant was granted a trade mark in respect of the word ZIMA, and the word ZIMA was actually a reference to a type of tomato, rather than just the Appellant’s own product, then it would effectively be granted a monopoly on that particular variety of fruit.
The Respondent relied on the decision Leachcroft Brothers Limited v Trade Marks [1954] Ch 210 in which Lloyd-Jacob J held at page 220-221:
In light of the evidence before me, it is clear that at the respective dates of application for each of those marks, the respondents intended only to use each mark in relation to one variety of rose, which variety as they well knew and intended either was or would be characterized by the same name recorded in the register of the Society.
…an intention to use the mark as the name of a variety appears to wholly inconsistent with a bona fide intention to use it as signifying a connection in the course of trade with the supplier, for which purpose it must necessarily be capable of differentiating between examples of the same variety coming from different trade sources. If the question be posed: was the name intended for use to distinguish rose trees of the respondents’ growing from rose trees of the same variety grown by others, or was it intended for use to distinguish one variety introduced by the respondents from the generality of roses, there can only be one answer, for the inevitable consequence of registration with the society was to give the name a variety status.
The Appellant on the other hand submitted that ZIMA was not the name of a new variety of tomatoes. Rather their position was that there were about 50 different cultivators of this particular type of tomato, and that the word ZIMA was simply used in relation to the product which they produced and distributed.
The decision of the Court
Justice Gordon held that there was a huge range of varieties of tomatoes (including a variety of the types of golden grape tomatoes), and that finding the line between a type of tomato and a brand, was difficult. At the time of the appeal, only one type of seed was being used to grow the Appellant’s product, however, other types were being trialled.
In resolving this appeal, Justice Gordon held:
[44] In any event other traders are not prevented from producing orange grape tomatoes and there are about 50 cultivars that will produce that type of tomato. Of the six cultivars presently used by Mastronardi, only two are supplied exclusively to Mastronardi. As can be seen …, there are a number of descriptors that other traders could find within the common heritage of the language to describe these tomatoes without having to use the word ZIMA…
[45] It follows from above that it is unlikely that other persons, trading in tomatoes and being actuated only by proper motives, would think of the word ZIMA and want to use it in connection with tomatoes in any manner which would infringe a registered trade mark granted in respect of it.
[46] Here Mastronardi sought to register a trade mark, the word ZIMA, to distinguish its goods (the tomatoes it sold) from the tomatoes of its trade rivals and indicate the trade source (and consequently quality) of its tomatoes. This is consistent with the meaning of trade mark in the TMA and the essential function of a trade mark is outlined in B & J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144.
Hence, Justice Gordon allowed the appeal and reversed the decision of the Delegate.
Lavan Legal comment
Whether or not a trade mark application is registrable will depend on (amongst other things) whether it is inherently adapted to describe or distinguish particular goods or services. That assessment will always be made in the first instance by a Delegate of the Registrar of Trade Marks.
While it may appear that these decisions are subjective, it is clear that on appeal a court will rationalise the statutory framework as objectively as possible.
In this case, the word ZIMA was invented by the president of the Appellant. It had never been used in Australia before, and at the time the Application was filed the products were not even on sale yet.
The evidence that there were still other cultivars of tomatoes in Australia who could use the same type of product, without using the registered trade mark, ultimately led Justice Gordon to find that the trade mark was capable of distinguishing the Appellant’s goods or services. In other words, the ZIMA trade mark was inherently distinguishable.
When it comes to branding your goods or services, it is important to be alive to the grounds on which it can be rejected.
Even though the Respondent was ordered to pay the Appellant’s costs, this litigation may have been avoided if the Appellant had been able to clarify from the outset that ZIMA would only ever be used exclusively in relation to its products, rather than in relation to a variety of fruit.