In both Alphapharm and Medrad, the Court reaffirmed that following the decision of Gummow J in Martin Engineering v Trison Holdings, the approach taken by the High Court in Beecham Group v Bristol Laboratories was no longer applicable. Accordingly, it is not necessary that the patentee show a strong prima facie case for the validity of the patent and indeed even if the alleged infringer shows a prima facie case of invalidity, this will not in and of itself defeat the injunction application.

On the question of the balance of convenience and adequacy of damages, both Jagot J in Alphapharm and Kenny J in Medrad were influenced by the likely impact on “trade patterns” resulting from the entry of a competing product into a market where there was an existing monopoly. In Alphapharm, the alleged infringer sought to minimise this consideration by pointing to the fact that the patentee had itself introduced a product into the market which was likely to compete with the product the subject of the patent. However Jagot J gave little weight to this argument, noting that:

it is one thing for a patentee to obtain a patent for a new product and place that new product on the market anticipating that it may have some effect on its existing product. It is another altogether for a patentee with a reasonably strong prima facie case for infringement to be exposed to competition against its existing product by an allegedly infringing product while the claim is resolved.

The only issue of significance was whether the claims of the patent were directed to a pharmaceutical substance per se as required by section 70. Recognising the difficulty in satisfying this condition due to the presence of the backing and protective layers, LTS sought to characterise these features as equivalent to the binders or excipients used in tablets and capsules. Alternatively, LTS argued that the backing and protective layers were not essential to the claimed invention.

In relation to the essential nature of the backing and protective layers, the Hearing Officer pointed to concessions by LTS as to the significance of those layers in the successful and effective administration of the drug. Further, even if the backing and protective layers were not in fact essential to the working of the invention, they were clearly essential limitations of the relevant claims.

Regarding the nature of the “pharmaceutical compound” as claimed, the Hearing Officer referred to the decision in N. V. Organon [2009] APO 8 (reported here) and concluded:

Prima facie, the presence in NEUPRO® of an inert backing layer and a protective layer which is removed before use, would exclude it from being a “compound of substances” for the purposes of s 70. However, following the reasoning in Organon, these layers would not be fatal to an extension if the patentee could demonstrate that the product as a whole shows a level of integration or interaction between the component parts such that it would fall within the definition of a pharmaceutical substance under the Act. However, LTS’s submissions during prosecution of the extension have been that the backing and protective layers constitute separate and subsidiary physical integers, that “in no way contribute to the working of the therapeutic substance”. This position is wholly inconsistent with NEUPRO® as a whole, being considered “a substance (including a mixture or compound of substances)” within the definition of Schedule 1.

Accordingly, while the meaning of “a pharmaceutical substance per se” may well be broader following Organon, the condition will not be satisfied where claims clearly recite features which constitute separate and subsidiary physical integers.

Fosters, relying on section 17(1)(a), alleged that the trade marks applied for would be deceptive or would cause confused having regard to its own trade marks, shown below:

Foster’s had not sold any goods bearing the above trade marks in New Zealand at the relevant date. However, it had sold such goods in Fiji and sought to rely on that use to in support of its opposition.

The Assistant Commissioner accepted that Foster’s could rely on the use of its trade marks in Fiji in support of the opposition because of the significant number of people who travel between New Zealand and Fiji.  The evidence provided by Foster’s in support of this proposition included details of its share of the Fijian beer market and the number of New Zealand resident departures to Fiji from 1983 to 2007.

Nonetheless, the opposition was unsuccessful.  The Assistant Commissioner, having compared the trade marks, found that they looked different and did not share conceptual similarities, and as such use of the marks applied for would not cause deception or confusion.

Interestingly the Assistant Commissioner stated that because the marks being compared were logo marks, the sound of the marks, or the manner in which they would be spoken was not applicable or significant.

Onus and Standard of Proof

Before looking at the substance of Guylian’s appeal, Sundberg J considered the onus and standard of proof to be applied. On the question of onus, his Honour referred to a tension between the presumption of registrability mandated by section 33 and the text and structure of section 41.

Sundberg J held that while the presumption applied in considering whether a trade mark met the criteria of section 41(3) by being inherently adapted to distinguish, once the inquiry moved to either sections 41(5) or (6):

the presumption no longer has any operation, as the applicant is then required to either “satisfy” the Registrar (s 41(5)), or “establish” (s 41(6)), that the relevant criteria set out therein is met.

On the question of the standard of proof, his Honour preferred the views of Gyles J in Clinique Laboratories v Luxury Skincare Brands Pty Ltd (2003) 61 IPR 130 and Pfizer Products Inc v Karam (2006) 70 IPR 599 to the effect that the standard was the conventional balance of probabilities rather than the higher burden suggested by the Full Court in Lomas v Winton Shire Council (2003) AIPC 91-839.

Adaptation to Distinguish

The Office had rejected the application on the basis that the shape was not capable of distinguishing the goods of Guylian from those of other traders.

In challenging this decision, Guylian firstly contended that its seahorse shape was fanciful and stylised and therefore not sufficiently similar to the shape of a real seahorse such that other traders might legitimately wish to use it. Guylian pointed to the fact that the tail of its seahorse shape wrapped up behind the spine of the creature rather than forwards as in a real seahorse and that it was of a solid and chunky appearance rather than the slender shape of a real seahorse. In consider whether the shape was inherently adapted to distinguish, Sundberg J noted that:

In cases where a shape depicts a known object or concept (cf. wholly concocted or ambiguous shapes), and is therefore likely to signify the same to most if not all consumers, then a subsidiary question is whether the shape is nevertheless sufficiently distinctive or unique so that other traders wishing to represent the same or a similar concept will remain free to do so without infringing the mark.

His Honour concluded that while there would be other ways to depict a seahorse and Guylian’s shape had some distinctive features “I am satisfied that it is not so unique or imaginative that other traders, using a seahorse shape for its ordinary signification, will be able to avoid potentially infringing the mark if it were registered”.

Guylian also submitted evidence of the sales and marketing expenditure in relation to the seahorse shape, the use of that shape on packaging as well as survey evidence seeking to show an association in the minds of consumers between that shape and Guylian.

In relation to the use of the shape on packaging and other marketing materials, Sundberg J agreed with the Registrar’s submission that “the “Guylian” trade mark printed on Guylian’s packaging has the effect of diluting any trade mark significance that might otherwise attach to the seahorse shape” and that “any distinctiveness the shape has acquired is attributable to its use alongside the traditional Guylian trade marks, rather than as a trade mark itself”.

Regarding the survey evidence, his Honour referred to the decision of Jacob J in Unilever plc’s Trade Mark Applications [2003] RPC 35, quoting:

in the case of marks consisting of product shapes it is not enough to prove the public recognises them as the product of a particular manufacturer. It must be proved that consumers regard the shape alone as a badge of trade origin in the sense that they would rely upon that shape alone as an indication of trade origin.

Sundberg J concluded that while the evidence plainly showed an association between the seahorse shape and Guylian, it was not sufficient to show that the association was referable to Guylian having used the shape as a trade mark.

This decision illustrates the difficulty in establishing sufficient inherent or actual distinctiveness in secondary shape trade marks and the care which needs to be taken in producing survey evidence if it is to fully answer the questions raised under section 41.

IPONZ proposed to reject the application on the basis of lack of distinctive character (section 18(1)(b)).  The applicant did not file any evidence use and it was left to the Assistant Commissioner to decide whether the mark had sufficient inherent distinctiveness.

The applicant argued that consumers of perfume recognize the shapes of bottles as trade marks, and the applicant’s mark was distinctive by virtue of its combination of features, including an octagonal shaped bottle; with flat surfaces on the front and back; raised square studs in each corner (giving the bottle an industrial appearance); and a two level ziggurat cap.

The Assistant Commissioner concluded that the whole of the mark lacked the inherent distinctiveness required for prima facie registration, because:

• It consists largely of a rectangular bottle, which other traders are likely to wish to use;
• Other traders were also likely to wish to use features such as a similarly shaped cap or similar forms of decoration around their bottles; and
• The scope of the application was broad; the application only provided two perspectives of the mark, it was not limited to colour, size or materials, all increasing the likelihood of other traders being caught by the proposed registration of the mark.

The Assistant Commissioner’s approach is in line with the current practice at IPONZ. It is notoriously difficult to register bottle shapes as trade marks without either evidence of use or a high degree of stylisation contained within the mark.  However, it would be interesting to know whether the outcome in this case would have been different had the explanation of the trade mark further limited the mark in terms of colour, size and material composition.

All parties involved, including the hearing officer, accepted that GOLDEN BEAR was well known in golfing circles as the nickname of Jack Nicklaus.

However, the hearing officer did not agree that the DROP BEAR GOLF Logo was deceptively similar to any of Nicklaus’ marks.  He noted that many Australians would be aware that a “drop bear” is a non-existent species of “killer koala”, which is so far from being an ordinary bear that no consumer of golfing products would be confused.  The fact that the paw print in the device could not have been made by a koala and was in fact an ordinary bear paw print, was considered to carry very little weight.

The lack of sufficient resemblance between the marks meant that the opposition failed on the section 44, 60 and 42(b) grounds.

The opposition then took an “interesting procedural turn” when Nicklaus Companies challenged the ownership of the opposed mark under section 58.  The opposed mark was filed by Michael Randazzo, a director and General Manager of Kialoa Pty Ltd.  Subsequent to the filing of the opposed application, Kialoa Pty Ltd commenced use of the opposed mark and an assignment of the mark to Kialoa Pty Ltd was recorded shortly before the opposition hearing.  The opponent submitted that the facts established that Kialoa, not Randazzo, was the owner of the mark at the time of filing.  The hearing officer held that this argument was “fundamentally flawed”, as there was no evidence that Randazzo lacked the requisite intention to use at the time of filing and Kialoa’s own property rights (based on actual use) did not come into being until later.

In relation to the ENO mark, the hearing officer considered that it was neither substantially identical nor deceptively similar to the applicant’s ENOVA marks, noting that:

I believe that the significant differences, both visual and aural, between the ENO and ENOVA trade marks militate against the possibility that they would leave deceptively similar impressions in the minds of potential customers

In relation to the EUNOVA mark, the hearing officer referred to passages in the text Shanahan’s Australian Law of Trade Marks and Passing Off 4th ed to the effect that in an opposition, “cogent evidence” was required where the ground of opposition relied upon could have been raised during examination but was not and in particular that:

In addition to the usual burden on an opponent, there are the problems that an examiner has already decided that an objection under s 44(1) or (2) could not be established

In this case, despite no indication that the original examiner considered the prior EUNOVA mark, the hearing officer concluded that:

absent both prior notice and supporting evidence relating to the EUNOVA trade mark, I am prepared to lean against a finding of deceptive similarity with the applicant’s ENOVA trade marks

These findings also resulted in a failure to establish the grounds of opposition raised under sections 42(b) and 60.