IN THE INTELLECTUAL PROPERTY OFFICE OF NEW ZEALAND [2015] NZIPOTM 9 IN THE MATTER of the Trade Marks Act 2002 AND IN THE MATTER of trade mark application nos. 149111 in class 30, 173987 in class 29, 173988 in class 30, 293733 ONLY CC’S IS TASTING LIKE THESE in class 29, 293734 ONLY CC’S IS TASTING LIKE THESE in class 30, 316068 in class 29, 316069 in class 30, 752029 CC’S in classes 29 and 30, and 752033 in classes 29 and 30, all in the name of BLUEBIRD FOODS LIMITED Owner AND IN THE MATTER of an application for revocation by GRIFFIN’S FOODS LIMITED Applicant for revocation Page 2 of 36 Hearing on 11 June 2015 T Huthwaite for the owner No appearance for the applicant for revocation TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 3 of 36 Introduction 1. This decision is in respect of applications to revoke the following trade mark registrations: Trade mark registration no. Mark Priority date Class(es) 149111 30 September 1983 30 173987 7 August 1987 29 173988 7 August 1987 30 293733 ONLY CC’S IS TASTING LIKE THESE 12 June 1998 29 293734 ONLY CC’S IS TASTING LIKE THESE 12 June 1998 30 316068 13 September 1999 29 316069 13 September 1999 30 26 July 2006 29 and 30 26 July 2006 29 and 30 752029 CC’S 752033 2. Full details of these trade mark applications are set out at Schedule 1. 3. The owner of each of these marks is Bluebird Foods Limited (Bluebird). 4. The applicant for revocation is Griffin’s Foods Limited (Griffins). 5. Griffins has filed the following trade mark application: Trade Mark Application no. Mark Application date Classes 984544 CC'S 16 September 2013 29 and 30 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 4 of 36 6. Full details of this trade mark application are set out at Schedule 2. It is currently in abeyance pending the outcome of this proceeding, and I understand that it has not yet been examined. 7. The Trade Marks Act 2002 (Act), and the regulations made under that Act (Regulations), apply to these proceedings. Grounds 8. Griffins relies on a single ground of revocation, namely that at no time during a continuous period of 3 years or more were the trade marks put to genuine use in the course of trade in New Zealand, by the owner for the time being, in relation to goods in respect of which they are registered (s 66(1)(a) of the Act). Evidence 9. Bluebird filed the following evidence in support of the continued registration of its trade mark registrations: 10. Name Occupation Date of evidence Exhibits Reference Jodene Nigro Marketing Manager of Bluebird Foods Limited 13 February 2014 10 Nigro 1 Griffins did not file any evidence. Preliminary issue – application to file further evidence 11. On 30 April 2015, Bluebird applied to file further evidence out of time. This further evidence comprised a second statutory declaration from Ms Jodene Nigro. That declaration was not executed properly; it was re-executed on 15 May 2015 and re-filed on 26 May 2015 (Nigro 2). 12. Apparently, Griffins advised by telephone that it opposed the filing of this further evidence. 13. On 21 May 2015, the Office gave notice of its intention to refuse to admit the further evidence, for the following reasons: TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 5 of 36 a. The case had been ready to be decided since Griffins advised in its letter of 17 April 2014 that it would not be filing evidence; b. The evidence related to product on sale in February 2015 – nearly 10 months after all the evidence in the proceeding had been completed; c. No information or evidence was provided on the steps taken to get the product to stores during the intervening 10-month period; d. There was no information which explained either the delay in making the request, or circumstances that were ‘out of the ordinary’; e. The substantive hearing set down for 12 May 2015 had to be vacated to allow time to consider this eleventh-hour request. 14. Regulation 34 provides that evidence may be filed out of time if there are “genuine and exceptional” circumstances that justify filing the evidence, or if the evidence could not have been filed earlier: 34 Evidence out of time (1) This regulation and regulation 35 apply to the following proceedings: … (c) an application for revocation of the registration of a trade mark: … (2) A party to a proceeding must not file evidence after the prescribed time unless the party has applied to the Commissioner for permission to file it and the Commissioner allows it. (3) The Commissioner may allow the evidence to be filed only if— (a) the Commissioner considers that there are genuine and exceptional circumstances that justify filing the evidence; or (b) the evidence could not have been filed earlier. (4) In this regulation, prescribed time means, in relation to a proceeding to which this regulation applies, the time prescribed in these regulations by which the evidence or type of evidence must be filed. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 6 of 36 15. The leading case is the decision of Lang J in Muir Electrical.1 In that case, his Honour observed that whether exceptional circumstances exist (and also, presumably, whether or nor the evidence could have been filed earlier) is not a matter of judicial discretion. Rather it is a matter of fact requiring judicial assessment. Any residual discretion may not be exercised until such time as those circumstances have been found to exist.2 Genuine and exceptional circumstances 16. Although Bluebird submits that there were genuine and exceptional circumstances that justify filing the evidence, in my view, the facts of this case fall more properly within the second limb of the test, which is that the evidence could not have been filed earlier. Could not have been filed earlier 17. In Foodstuffs NZ Limited v Fresh Express Group Pty Limited, Assistant Commissioner Walden found that of the three exhibits that were the subject of the application, two could not have been filed earlier.3 The deadline for filing the relevant evidence in that case was 14 August 2006 and those exhibits were dated 29 August 2006 and 31 August 2006 respectively.4 18. Similarly, in this case, the evidence sought to be filed relates to matters arising after the deadline for filing the relevant evidence. As a matter of fact, therefore, I find that the evidence could not have been filed earlier. Discretion 19. In light of this finding, I must now consider whether the Commissioner’s discretion to allow the evidence to be filed should be exercised in favour of Bluebird. 1 Muir Electrical Company Pty Ltd v The Good Guys Group Limited, HC Auckland CIV-2009-404-4965, 18 December 2009. That case concerned an application under reg 32 for an extension of time in which to file certain evidence, but it is also relevant to the application of reg 34 of the Regulations. 2 Ibid at [83], citing R v Rajamani [2008] 1 NZLR 723. 3 Foodstuffs NZ Limited v Fresh Express Group Pty Limited [2007] NZIPOTM 40 at 13. 4 Ibid. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 7 of 36 Efficiency and economy of proceedings 20. There is a strong public interest in ensuring that parties meet statutory deadlines and file their evidence within the prescribed time. In Muir Electrical, Lang J said that the public interest will usually favour the party opposing an application for an extension under reg 32 (and, presumably, reg 34 also).5 Prejudice to the parties 21. Bluebird would suffer some prejudice if its application were refused. It would not be able to put forward its best and most complete case. 22. On the other hand, however, the evidence relates to matters outside the relevant non-use period, so it is of relatively limited significance – although I accept Mr Huthwaite’s submission that it may be relevant in terms of demonstrating that Bluebird’s preparatory use of its marks during the relevant period eventually culminated in actual use of those marks. 23. I do not consider that Griffins would be significantly prejudiced if Bluebird were allowed to file further evidence out of time. It has elected not to file evidence or to take any other formal steps in this proceeding beyond filing the relevant applications. Full and fair hearing 24. There is a public interest factor in having the substantive merits of the case investigated fully and properly. In Jellinek’s Application, which involved an application to file further evidence on appeal, Evershed MR said:6 In approaching this matter one has, in the first place, to be careful not to work any injustice on the party seeking to bring forward further material lest, if that if that party should in the end be unsuccessful, he should feel that his cause has not been fully investigated. 5 Muir Electrical Company Pty Ltd v The Good Guys Group Limited, HC Auckland CIV-2009-404-4965, 18 December 2009 at [71]. 6 Jellinek’s Application (1946) 63 RPC 59 at 61. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 8 of 36 25. There is also authority to the effect that the public interest in having all relevant evidence before the decision-maker is to be given greater weight in the context of trade mark proceedings, which involve matters of public interest.7 Finding in relation to exercise of discretion 26. On balance, I consider that the lack of any real prejudice to Griffins, coupled with the public interest in having all of the relevant evidence available to the decisionmaker, favours allowing the application to file the further evidence. 27. I allow the second declaration of Ms Nigro to be admitted into evidence, and I confirm that I have taken it into account for the purposes of this decision. Is Griffins an aggrieved person? 28. Section 65(1) of the Act provides that an “aggrieved person” may apply to the Commissioner or the Court for the revocation of the registration of a trade mark. 29. The term “aggrieved person” under the Act is to be given a liberal or wide interpretation, consistent with s 5(1) of the Interpretation Act 1999.8 30. Griffins has the onus of establishing that it was an aggrieved person as at the application date of 16 September 2013.9 It alleges that it was an aggrieved 10 person at that time for the following reasons: a. On 16 September 2013 Griffins applied to register the trade mark CC’S in classes 29 and 30; b. Griffins proposes to use the trade mark CC’S on the goods covered by its trade mark application; c. Bluebird’s trade mark registrations will prevent Griffins’ trade mark application from being accepted by the Commissioner of Trade Marks; 7 See, for example, Pioneer Hi-Bred Corn Company v Hyline Chicks [1978] 2 NZLR 50 at 73-4, which related to the filing of further evidence on appeal. 8 Fareed Khalaf Sons Company trading as Khalaf Stores v Phoenix Dairy Caribe NV HC Wellington CIV 2002-485-000207, 3 September 2003 at [23]. 9 Manhaas Industries (2000) Limited v Fresha Export Limited [2012] NZHC 1815 at [21]. 10 Applications for revocation, paragraphs 1-6. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 9 of 36 d. Bluebird may object to Griffins’ use of the trade mark CC’S by relying on its registered trade mark rights; e. Griffins will be appreciably disadvantaged in a legal or practical sense by the registration remaining on the register. 31. Bluebird denies that Griffins is an aggrieved person. It says that Griffins’ failure to adduce any evidence in support of its aggrieved person status is fatal. In this regard, Bluebird relies on the following passage from Unique Drinks of NZ Ltd v New World Premium Brands Ltd:11 [18] In view of the owner denying the applicant is an aggrieved person, the applicant has the onus of proving that it is an aggrieved person on the balance of probabilities. However, the applicant has filed no evidence. Finding [19] It follows that, at the application date, the applicant has not established that it was an aggrieved person. The applicant’s application for revocation therefore fails. There is no need to consider whether the owner used its mark during the relevant period. 32. Nonetheless, Mr Huthwaite acknowledged, responsibly, that in determining this issue I may take notice of facts that are a matter of public record. In this case, unlike the Unique Drinks decision referred to above, the applicant for revocation has filed a trade mark application, and that application forms part of the public record. 33. Bluebird says that there is no evidence or any real indication that Bluebird’s CC’S marks will prevent Griffins’ trade mark application from being accepted. At this stage, it says, such a finding would be purely speculative, and it would not be appropriate for the Commissioner to usurp the examiner’s role in this regard. Similarly, it says that it would not be appropriate for the Commissioner to speculate that Bluebird would object to use of the mark by Griffins on the basis of its earlier registrations. 34. Trade mark application no. 984544 filed by Griffins is identical to Bluebird’s trade mark registration no. 752029, and it is filed in respect of the same classes of 11 Unique Drinks of NZ Ltd v New World Premium Brands Ltd [2013] NZIPOTM 33 at [18] – [19]. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 10 of 36 goods (classes 29 and 30). The mark applied for by Griffins also has similarities with Bluebird’s other trade mark registrations set out above, and is also filed in the same classes of goods as those marks. 35. The statement of use made in respect of Griffins’ trade mark application records that “the mark is being used or proposed to be used, by the applicant or with his/her consent, in relation to the goods/services”. 36. I consider that it would require a wilful suspension of disbelief for me to find that Griffins’ trade mark application and/or any use it makes of the mark is not likely to be disadvantaged by Bluebird’s trade mark registrations. I note, for example, that Bluebird’s counsel characterises Griffins’ trade mark application as a straightforward “bad faith smash and grab” attempt to misappropriate Bluebird’s brand. 37. In my view, the public record indicates that Griffins wishes to own and use the CC’S brand to the exclusion of Bluebird. I find that Griffins is appreciably disadvantaged in these intentions by Bluebird’s registrations remaining on the register as at 16 September 2013, and that accordingly Griffins was an aggrieved person at that time. Application for revocation for non-use (s 66(1)(a)) 38. Section 66(1)(a) of the Act provides: 66 Grounds for revoking registration of trade mark (1) The registration of a trade mark may be revoked on any of the following grounds: (a) that at no time during a continuous period of 3 years or more was the trade mark put to genuine use in the course of trade in New Zealand, by the owner for the time being, in relation to goods or services in respect of which it is registered 39. As noted above, the applications for revocation were filed on 16 September 2013, and therefore the relevant three-year period is 16 August 2010 to 16 August 2013.12 12 Section 66(1A) of the Act provides that for the purposes of s 66(1)(a), continuous period means a period that commences from a date after the actual date of registration and continues uninterrupted up to the date one month before the application for revocation. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 11 of 36 40. Bluebird must establish that during the period 16 August 2010 to 16 August 2013, it put the marks to genuine use in the course of trade in New Zealand, in relation to the goods in respect of which they are registered. Legal principles – genuine use in the course of trade 41. There is no de minimis rule regarding the amount of use of a trade mark in the context of revocation proceedings as long as the use is genuine.13 42. In Ansul BV v Ajax Brandbeveiling BV, the European Court of Justice held that the following factors were relevant to an assessment whether use of a mark amounted to “genuine use”:14 a. Genuine use means use that is not merely token, serving solely to preserve the rights conferred by the mark. Such use must be consistent with the essential function of a trade mark, which is to guarantee the identity of the origin of goods or services to the consumers or end users, by enabling them, without any possibility of confusion, to distinguish the product or service from others which have another origin. b. Genuine use entails use of the mark on the market for the goods or services protected by that mark and not just internal use by the undertaking concerned. The protection the mark confers and the consequences of registering it in terms of enforceability vis-a-vis third parties cannot continue to operate if the mark loses its commercial raison d’etre, which is to create or preserve an outlet for the goods or services that bear the sign of which it is composed, as distinct from the goods or services of other undertakings. Use of the mark therefore has to relate to goods or services already marketed or about to be marketed and for which preparations by the undertaking to secure customers were underway, particularly in the form of advertising campaigns. Such use can be either by the trade mark proprietor or by a third party with authority to use the mark. 13 Kerly’s Law of Trade Marks and Trade Names (15th ed, Sweet & Maxwell, London, 2011) at [10-048] – [10-061]; Laboratoires Goemar SA v La Mer Technology Inc [2005] EWCA Civ 978. See also Metalman New Zealand Ltd v Scrapman BOP Ltd [2014] NZHC 2028. 14 Ansul BV v Ajax Brandbeveiling BV [2003] RPC 717 at 725-6, summarised in Metalman New Zealand Ltd v Scrapman BOP Ltd [2014] NZHC 2028 at [14]. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 12 of 36 c. When assessing whether there has been genuine use of the trade mark, regard must be had to all the facts and circumstances relevant to establishing whether the commercial exploitation of the mark is real. This may involve consideration of whether the use in question is warranted in the economic sector concerned to maintain or create a share in the market for the goods or services protected by the mark. d. Assessing the circumstances of the case can include giving consideration to the nature of the goods or services at issue, the characteristics of the market concerned and the scale and frequency of use of the mark. Use of the mark does not always have to be quantitatively significant for it to be deemed genuine, as that depends on the characteristics and market of the goods or services in question. 43. In Cure Kids v National SIDS Council of Australia Ltd, it was held that in some circumstances, preparatory use may amount to genuine use of a trade mark, notwithstanding the fact that there is no actual end use in the consumer market.15 Australian courts have held that the distribution of business cards, use of letterheads on correspondence to potential advertisers and the production of a brochure was preparatory use which amounted to genuine use.16 Nonetheless, the mark must be communicated to a third party in such a way as can be said to be ‘consistent with the essential function of a trade mark’, as explained in Ansul.17 Did Bluebird use its marks during the relevant period? 44. Bluebird did not sell any products bearing the marks during the relevant period, but it says that, nonetheless, it made genuine use of the marks by preparing to relaunch the brand during 2012 and 2013. 45. Bluebird first introduced its CC’S brand of corn chips into the New Zealand market in the early 1980s.18 In keeping with the Mexican heritage of corn chips, it used the slogan “only CC’s is tasting like these”, pronounced with a Mexican accent.19 15 Cure Kids v National SIDS Council of Australia Ltd [2014] NZHC 3366 at [106]. Buying Systems Australia Pty Ltd v Studio SRL [1995] FCA 1063; (1995) 30 IPR 517 at [9], applied in Cure Kids v National SIDS Council of Australia Ltd [2014] NZHC 3366 at [106]. 17 Laboratories Goemar SA v La Mer Technology Inc [2005] EWCA CIV 978 at [48], applied in Cure Kids v National SIDS Council of Australia Ltd [2014] NZHC 3366 at [116] – [117]. 18 Nigro 1, paragraph 3. 16 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 13 of 36 46. In 2010, Bluebird discontinued its CC’S range of corn chips, and introduced a new brand called DORITOS.20 Almost immediately, a social media campaign was launched, seeking the re-introduction of the CC’S range.21 47. The year 2013 was Bluebird’s 60th birthday year. As part of its celebrations, Bluebird decided to re-release the DISCOS and CCS products.22 48. Preparation for the re-release of the CC’s and DISCOS nostalgia brands began in 2012.23 In support of this statement, Ms Nigro attaches to her evidence a copy of Bluebird’s 60th birthday brief, which I understand was prepared in 2012.24 That brief does not, however, mention either CC’s or DISCOS products. It says: Product: 49. Bluebird PC, Extrusions (i.e. Twisties), Grainwaves The DISCOS re-release went according to plan, and DISCOS branded product began to be sold throughout New Zealand from April 2013. However, problems were encountered with the re-release of CC’s and it did not take place.25 50. In March/April 2013 Bluebird’s corn chip production was severely impacted by problems with the new season’s corn crop, which was a new corn hybrid. There were problems with cooking the corn chips made from the hybrid corn, and trials had to be conducted to refine processing.26 The disruption to the production of corn chips resulted in significant reduction of Bluebird’s stock levels of DORITOS corn chips, so that promotion of DORITOS chips had to be reduced in order to maintain supply.27 51. In addition, in May 2013, Bluebird’s corn stocks were affected by an infestation of weevils.28 The infestation resulted in reduction in supply of corn suitable for processing into corn chips. 19 Nigro 1, paragraph 4. Nigro 1, paragraph 5. 21 Nigro 1, paragraph 6. 22 Nigro 1, paragraph 8. 23 Nigro 1, paragraph 10. 24 Nigro 1, exhibit JN-8. 25 Nigro 1, paragraph 12. 26 Nigro 1, paragraph 12. 27 Nigro 1, paragraph 13 and exhibit JN-10. 28 Nigro 1, paragraph 14. 20 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 14 of 36 52. Due to the disruption of corn chip production the re-release of CC’s branded corn chips was shelved in order for all resources to be focussed on supplying DORITOS branded product to New Zealand consumers.29 53. On 17 June 2013 (after the difficulties with corn chip production were said to have arisen) copies of media kits were produced and sent to a range of customers, retailers and media companies “to help you celebrate 60 years of Bluebird”.30 54. The media kit represents the only “external” use of the marks made during the three-year period. Bluebird relies upon this particular use as demonstrating actual use of the marks during the relevant period. 55. Only one page of the media kit was included in evidence, and this page is reproduced at Schedule 3. It is headed “Take a look back over the years… Remember these?”, and features images of six Bluebird products, including CC’S and DISCOS. It does not say that any of the six products would be re-launched or otherwise made available. 56. As noted above, this kit was distributed after the production problems arose in respect of the manufacture of corn chips. Bluebird’s intentions with regard to the re-launch of CC’S at the time this kit was distributed are unclear. It seems likely that by this time the re-launch plans had been shelved, at least for the time being. 57. I am not convinced that this use of the mark CC’S was in relation to goods that were about to be marketed and for which preparations to secure customers were underway. Nor do I accept that this use of the mark was to create or preserve an outlet for CC’S corn chips, or that it amounted to a real commercial exploitation of the marks in the sense of maintaining or creating a share in the market for the goods or services protected by the marks. 58. The references in the media kit to various old products and packaging, including the reference to CC’S, seem designed primarily to evoke feelings of nostalgia and affection, not to maintain or create a share in the market for the featured products. 59. Accordingly, I find that Bluebird has not discharged the onus it bears to show that there was genuine use of its marks during the relevant period. 29 30 Nigro 1, paragraph 15. Nigro 1, paragraph 8 and exhibit JN-6. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 15 of 36 Was Bluebird’s non-use of the marks due to special circumstances? 60. Section 66(2) of the Act makes provision for maintaining a mark that has not been used due to “special circumstances”: However, despite subsection (1), a trade mark may not be revoked for its non-use if its non-use is due to special circumstances that are outside the control of the owner of the trade mark. 61. In Woolly Bull Enterprises Pty Ltd v Reynolds, the Court set out various criteria for examining whether or not there were special circumstances, including the following:31 a. The phrase “due to special circumstances in the trade” refers “to circumstances which are ‘special’ in the sense of being peculiar or abnormal and which are experienced by persons engaged in a particular trade as the result of the working of some external forces as distinct from the voluntary acts of any individual trader”; b. It is not necessary to show that the “special circumstances” made use of the mark impossible; it is enough to show that those circumstances made it impractical, in a business sense, to use the mark; c. Even if “special circumstances” are established, they will excuse non-use only if there is a causal link between them and the nonuse. 62. The High Court in Manhaas Industries (2000) Ltd v Fresha Export Ltd observed that the legislative threshold for establishing “special circumstances” is high:32 [27] Thus, of the three jurisdictions referred to, New Zealand is the only one that continues to require proof of special circumstances if the owner of an unused trade mark is to avoid risking having their trade mark deregistered. New Zealand has however ceased to require proof of a direct link between the special circumstances relied upon and the trade in which the trade mark owner engages. 31 Woolly Bull Enterprises Pty Ltd v Reynolds (2001) 51 IPR 149 at [45], applied in Cure Kids v National SIDS Council of Australia Ltd [2014] NZHC 3366 at [136]. 32 Manhaas Industries (2000) Ltd v Fresha Export Ltd [2012] NZHC 1815 at [23] – [30]. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 16 of 36 … [30] These authorities make it clear that the threshold that a registered owner of an unused trade mark must meet is particularly high. The phrase “special circumstances” in a statute invariably involves the need to establish rare and highly unusual factors that are beyond the control of the person who seeks to rely upon those special circumstances. The enquiry in this context is very fact specific. 63. As noted above, Bluebird discontinued the CC’s range of corn chips in 2010.33 There is no suggestion that this decision was taken as a result of any special circumstances. 64. Bluebird apparently planned to re-release Bluebird brands DISCOS and CCs in 2013.34 There is no evidence as to when this decision was taken, or by whom. 65. DISCOS branded products were re-launched as planned in April 2013. It is not clear precisely when in 2013 the re-launch of CC’S was intended to take place, although it seems likely that this was also due to occur in April 2013. 66. As outlined above, in March/April 2013 Bluebird’s corn chip production was impacted by problems with the new season’s corn crop. There were problems with cooking the corn chips made from the hybrid corn.35 The disruption to the production of corn chips resulted in significant reduction of Bluebird’s stock levels of DORITOS corn chips, so that promotion of DORITOS had to be reduced in order to maintain supply.36 67. On 11 April 2013, the following email was circulated under the subject heading “Doritos Issue”:37 … we have an impending issue on Doritos that is going to require some urgent attention. In short, we are having extreme difficulty processing the current batch of corn and it is almost certain we will be out of stock by next week. Dylan is working on some options to import Australian finished product as a short-term measure, however we also need to dampen demand by removing promotional activity. Nigel, can you please coordinate grocery plans to reduce Doritos activity on all packs as quickly as possible… Can you also discuss and agree what would need to happen 33 Nigro 1, paragraph 5. Nigro 1, paragraph 8. 35 Nigro 1, paragraph 12. 36 Nigro 1, paragraph 13 and exhibit JN-10. 37 Nigro 1, paragraph 13 and exhibit JN-10. 34 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 17 of 36 with each customer in order for them to accept Australian-manufactured 175g packs of our three leading products (i.e. need UBFs, codes can be linked etc). Gavin, likewise within your team, we are going to need to remove activity immediately. Please do not communicate to TMGs/TMIs or customers yet, as we need to have a plan in place for the next few weeks… 68. By the time these production problems arose, it is not clear how advanced preparations were in terms of the planned re-release of CC’S products. There is no mention in this email of CC’S products, or the impact that the production problems would have on the planned re-release. This seems odd, especially if the CC’S re-launch was to take place at the same time as the launch of DORITOS in April 2013 – i.e. precisely the time when this email was sent. 69. On 12 April 2013, a further email was circulated within Bluebird:38 Summary of Doritos Supply & Demand Discussion 2:30 p.m. Friday 12/04/13 Production Summary Over the last 4 – 5 weeks we have had lower than planned performances from our Corn Line driven mostly by mechanical issues. These performance issues eroded some of our normal safety stock and meant that we started this week on a lower than planned stock position. This week we also began to use a new season’s crop of corn and unexpectedly have had severe problems with corn cooking on the Corn line. This resulted in poor quality product being produced which was not saleable for most of the week. Having used this variety of corn previously we were not expecting any impact with this seasonal change. The Manufacturing, R & D and Engineering teams have been working continuously throughout this week to understand this issue. After extensive trials and by testing alternative corn supply from another vendor we were finally able to isolate new season corn as the key quality problem affecting this line on Thursday night. Continuing to use this alternative corn supply has allowed production to continue today and the line is now running and performing normally at this stage. 38 Nigro 1, paragraph 13 and exhibit JN-10. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 18 of 36 The impact of this disruption is that stock levels of a number of corn products are now very low and this will lead to out of stocks across a number of corn products from early next week. Details to be confirmed. The decision was made today to make the core flavours only in all pack groups at least in the short term. Details to be confirmed by Andrew. Demand Summary In order to reduce customer OOS’s Nigel and his team have been looking at promotional activity that can be removed between now and mid May. Removing these [sic] volume will allow us to build inventory and to restore normal service levels quicker. This work will be completed ASAP and sent to Paul and Andrew who will update their supply plans to understand how long the service issues are expected to continue. Feedback is expected on Monday. Other Options To further help the service position Dylan is currently in negotiations with Australia to secure the importation of an additional 10,000 cases of Australian Corn product into NZ. This would be harmonised SKU’s only and have the same consumer packaging as NZ product. The intention is that this stock would be sold through Foodstuffs Auckland only to reduce operational and consumer impact. The viability of the supply is not yet confirmed in further detail is expected on Monday. 70. Again, there is no discussion of how the production problems would affect CC’S products. The email relates solely to DORITOS products. 71. Bluebird says that, on top of these production problems in April 2013, in May 2013, its corn stocks were affected by an infestation of weevils.39 The infestation resulted in reduction in supply of corn suitable for processing into corn chips. The extent of the infestation and its effects on CC’S products is not clear, however. 72. Bluebird also seeks to rely upon “compliance with stringent product testing and quality control” as a factor affecting its production of corn chips:40 The scale of Bluebird’s corn chip production, and the amount of raw corn material required by that process, made it impossible to quickly source an alternative suitable supply of raw corn material. Compliance with stringent product testing and quality 39 40 Nigro 1, paragraph 14. Nigro 1, paragraph 16. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 19 of 36 control necessary in the food industry further compounded Bluebird’s corn chip production problems. 73. Ms Nigro says that due to disruption of corn chip production in 2013, the rerelease of CC’s branded corn chips was shelved, in order for all resources to be focussed on supplying DORITOS branded product to New Zealand consumers.41 74. It is not clear from the evidence when the decision to shelve the re-release of CC’S in 2013 was taken, or by whom, or whether there were any other contributing factors. 75. In my view, there is insufficient evidence that Bluebird’s non-use of its marks was due to the special circumstances upon which it seeks to rely. Should the Commissioner’s discretion be exercised in favour of the owner? 76. In Cure Kids v National SIDS Council of Australia Ltd, Moore J confirmed that the use of “may” in section 66(1) of the Act, rather than “must”, indicates that there is a discretion not to revoke the registration of a mark even if the grounds set out in that section are made out.42 77. After reviewing the relevant authorities, his Honour concluded that the following factors are to be taken into account in the exercise of the discretion: a. Did the owner intend to abandon the mark? b. Were the steps taken to revive the mark bona fide and unrelated to the application for revocation? c. During the period of dormancy did the owner, nonetheless, have a residual reputation in the mark? d. Has there been a credible and effective use of the mark after the relevant period ended? e. Will anyone be deceived or confused or likely to be deceived or confused if the mark remains on the register? 41 42 Nigro 1, paragraph 15. Cure Kids v National SIDS Council of Australia Ltd [2014] NZHC 3366 at [171]. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 20 of 36 f. Will the continued ownership of the trade mark block another’s legitimate desire to use the trade mark? 78. I will consider each of these in turn. Did Bluebird intend to abandon the marks? 79. In my view, it is clear that Bluebird did not intend to abandon the marks. Prior to the application for revocation, Bluebird was at least considering re-launching the CC’S brand. Were the steps taken to revive the marks bona fide and unrelated to the application for revocation? 80. I consider that Bluebird’s preparations in 2012/ 2013 in respect of its 60th birthday celebrations were bona fide. These steps were taken prior to the application for revocation and were unrelated to it. Although very little was provided in terms of contemporaneous documentation showing that the 60th birthday celebrations were to include a re-launch of CC’S, Ms Nigro has given uncontested evidence that “as part of the sixtieth birthday celebrations, Bluebird planned to re-release Bluebird brands DISCOS and CC’s.”43 81. It is less clear, however, whether or not the more recent use of the marks described in Nigro 2 was also bona fide and unrelated to the application for revocation. By that time, Bluebird was on notice of the application for revocation and this hearing was imminent. 82. The first production run for CC’S branded corn chips started on 5 January 2015.44 Stock levels were built over the course of January 2015, and were available for order from 2 February 2015.45 Product has been available in stores from 9 46 February 2015. 83. There is no explanation for the lengthy hiatus from 2012, when planning for the re-launch began, and the actual re-launch in 2015. I cannot disregard the 43 Nigro 1, paragraph 8. Nigro 2, paragraph 3. 45 Nigro 2, paragraph 4. 46 Ibid. 44 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 21 of 36 possibility that the re-launch of the product in February this year was simply an attempt to bolster Bluebird’s position for the purposes of these proceedings. During the period of dormancy did the owner nonetheless have a residual reputation in the mark? 84. I consider that Bluebird has a residual reputation in the mark CC’s, despite the period of dormancy, as evidenced by the following: a. from the early 1980s until 2010 (a period of nearly 30 years), tens of millions of dollars of CC’S products were sold in New Zealand;47 b. CC’S products were advertised on television in New Zealand during the 1980s, 1990s and 2000s;48 c. When the CC’S range of corn chips was discontinued, a social media campaign was launched seeking the reintroduction of CC’S. This campaign does not appear to have been extensive, but there is evidence of Facebook comments spanning the period from November 2010 until December 2013;49 d. When the decision was taken to replace CC’S corn chips with DORITOS corn chips, the New Zealand Herald published a story entitled “Kiwi icons kicked off shelves to make way for US chips” (27 March 2010);50 e. In July 2012, CC’S corn chips featured in another New Zealand Herald article entitled “Five foods Kiwis want back on shelves”. The article said that the catch phrase ONLY CC’S ARE TASTING LIKE THESE “wormed [its] way into the minds of New Zealanders everywhere in the 1990s”, and that “when Bluebird cut the iconic Kiwi brand in 2010, New Zealanders immediately began stockpiling the chips and multiple Facebook pages aimed at saving them sprung up.” 47 Nigro 1, paragraph 3. Nigro 1, paragraph 4. 49 Nigro 1, paragraph 6 and exhibit JN-3. 50 Nigro 1, exhibit JN-2. 48 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 22 of 36 Has there been a credible and effective use of the mark after the relevant period ended? 85. There has been use of at least some of Bluebird’s marks after the relevant period ended.51 86. The word “use” is defined in s 7 of the Act as follows: 7 Meaning of use of trade mark (1) In this Act, unless the context otherwise requires, use, in relation to a trade mark, includes – (a) use in a form differing in elements that do not alter the distinctive character of the trade mark in the form in which it was registered 87. The packaging on the product sold from February 2015 onwards bears the trade mark 88. (trade mark no. 752033).52 The use of this mark also amounts to use of the word mark CC’S, and possibly also of (trade mark nos. 316068 and 316069) and (trade mark nos. 173987 and 173988). 89. I note, for example, that in Pioneer Computers Australia Pty Ltd v Pioneer KK the Federal Court of Australia held that use of the word “Pioneer” in a particular stylised font constituted use of an earlier stylised representation of that word.53 The Court said that the second mark “clearly evolved from the first mark by, e.g., modernising it from capitals to partly lowercase”, and held that the alterations did not substantially affect the identity of the trade mark: the differences were minor and reflected a change of style rather than a substantive change or a change in the source of the goods and services. 51 See, for example, Nigro 2, paragraphs 3 and 4 and exhibit JN-1. Nigro 2, exhibit JN-1. 53 Pioneer Computers Australia Pty Ltd v Pioneer KK (2009) 80 IPR 38 at [116] – [117]. 52 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 23 of 36 90. In my view, however, the use of trade mark of trade mark no. 149111 and . does not amount to “use” I consider that the differences between are such that they alter the distinctive character of trade mark no. 149111 in the form in which it was registered. 91. The new packaging also bears the slogan “ONLY CC’S EES TASTING LIKE THEES”.54 I consider that the use of this slogan amounts to “use” of the trade mark ONLY CC’S IS TASTING LIKE THIS (trade mark nos. 293733 and 293734). The slogan as it appears on the packaging is intended to represent the mark ONLY CC’S IS TASTING LIKE THIS pronounced in a particular accent, and I consider that it would be understood as such. Will anyone be deceived or confused or likely to be deceived or confused if the mark remains on the register? 92. There is no suggestion that anyone is likely to be deceived or confused if the marks were to remain on the register. Will the continued ownership of the trade marks block another’s legitimate desire to use those marks? 93. The continued ownership of the trade marks may well block Griffins’ desire to use those marks. However, Bluebird submits strongly that Griffins’ desire to use the marks is not legitimate. In the absence of any evidence or submissions from Griffins, that allegation is difficult to assess. Finding – exercise of discretion 94. Taking into account all of the factors set out above, I consider that the Commissioner’s discretion should be exercised in favour of the marks remaining on the register. 54 Nigro 2, exhibit JN-1. TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 24 of 36 95. In particular, I am influenced by the fact that Bluebird did not abandon its marks; the evidence that there is a residual reputation in the marks despite the period of dormancy; and the fact that no one would be deceived or confused if the marks were to remain on the register in the name of Bluebird Foods Limited – in fact, the opposite may be true. Findings and directions 96. I find that: a. Griffins is an aggrieved person; b. Bluebird has not used the marks during the relevant period; c. Bluebird has not established that its non-use of the marks was due to special circumstances; d. Nonetheless, the Commissioner’s discretion should be exercised in favour of the marks remaining on the register. 97. Accordingly, I direct that trade mark nos. 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, and 752033 are to remain on the register. Costs 98. As the successful party, Bluebird is entitled to costs. It also seeks additional costs, for the following reasons: a. Griffins did not file any evidence in support of its applications for revocation. Its applications were speculative and vexatious; TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 25 of 36 b. Griffins has done the bare minimum to keep the proceeding alive. It did not file evidence or written submissions, or appear at the hearing. It has put Bluebird to significant expense in defending the applications for revocation in full. c. Due to the lack of particulars in Griffins’ applications, the lack of evidence filed by Griffins, and the lack of indication as to which grounds were being pursued, Bluebird has been required to make submissions on every point relating to the applications for revocation; d. Bluebird filed evidence that clearly indicated that its marks should remain on the register, yet Griffins did not withdraw its applications for revocation. 99. I do not agree that increased costs are justified in the circumstances of this case. I have found that Bluebird did not make genuine use of its marks during the relevant period. It is only because of the exercise of the Commissioner’s discretion that the marks remain on the register. 100. Also, I note that because nine separate but largely identical applications were filed, the owner receives something of a windfall in respect of its costs of preparing and filing nine counterstatements. 101. I award scale costs to Bluebird in the sum of $4,720, calculated as follows: Item in IPONZ scale of costs Amount Preparing and filing counter statements (x 9) 2,700.00 Preparing and filing the owner’s evidence 400.00 Preparation of case for hearing 500.00 Attendance at hearing by counsel (1.5 hours) 270.00 Hearing fee 850.00 TOTAL: $4,720 to the owner TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 26 of 36 Dated this 9th day of July 2015 ________________________________ Jane Glover Assistant Commissioner of Trade Marks Baldwins for the owner A J Park for the applicant for revocation TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 27 of 36 Schedule 1: Details of Bluebird Foods Limited’s trade mark registrations Trade mark registration no. 149111 Trade mark Trade mark name CC'S CORN CHIPS STYLISED Trade mark type Combined Class 30 [Nice classification Schedule 4] Goods cereal based snack foods Statement of use Proposed to be used by a registered user Status Registered Filed on 30 September 1983 Trade mark no. 173987: Trade mark Trade mark name CC'S Trade mark type Combined Class 30 [Nice classification Schedule 4] Goods cereal based snack foods, being corn chips TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 28 of 36 Statement of use Proposed to be used by a registered user Status Registered Filed on 7 August 1987 Trade mark no. 173988: Trade mark Trade mark name CC'S Trade mark type Combined Class 29 [Nice classification Schedule 4] Goods Potato crisps, cooked vegetable products Statement of use Proposed to be used by a registered user Status Registered TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 29 of 36 Filed on 7 August 1987 Trade mark no. 293733: Trade mark ONLY CC'S IS TASTING LIKE THESE Trade mark name ONLY CC'S IS TASTING LIKE THESE Trade mark type Word Class 29 [Nice classification Schedule 4] Goods preserved, dried and cooked fruit and vegetables; snack foods in this class such as, but not limited to potato chips; dips in this class Statement of use Being used by the proprietor(s), (being the applicant) Status Registered Filed on 12 June 1998 Trade mark no. 293734: Trade mark ONLY CC'S IS TASTING LIKE THESE Trade mark name ONLY CC'S IS TASTING LIKE THESE TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 30 of 36 Trade mark type Word Class 30 [Nice classification Schedule 4] Goods preparations made from cereal; snack foods in this class such as, but not limited to corn chips; dips in this class Statement of use Being used by the proprietor(s), (being the applicant) Status Registered Filed on 12 June 1998 Trade mark no. 316068: Trade mark Trade mark name CC'S Trade mark type Combined Class 29 [Nice classification Schedule 4] Goods salad dressing; cheese dips; snacks and dishes all consisting of vegetables, fruits and foodstuffs included in this class TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 31 of 36 Statement of use Proposed to be used by the proprietor(s), (being the applicant) Status Registered Filed on 13 September 1999 Trade mark no. 316069: Trade mark Trade mark name CC'S Trade mark type Combined Class 30 [Nice classification Schedule 4] Goods sauces including barbecue sauce, spiced and seasoned sauces; snacks and dishes all consisting of foodstuffs included in this class; seasonings Statement of use Proposed to be used by the proprietor(s), (being the applicant) Status Registered Filed on 13 September 1999 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 32 of 36 Trade mark no. 752029: Trade mark CC’S Trade mark name CC'S Trade mark type Word Classes 29 and 30 [Nice classification Schedule 8] Goods Class 29: snack foods of all kinds in this class, including dehydrated fruit snacks, dehydrated fruit and gummy confections, fruit based snack foods, fruit substitute based snack foods, nut based snacks, fruit and nut based snack foods, snack mix consisting primarily of processed fruits and/or processed nuts, dried fruit snacks, potato crisps and chips, cheese dips and cheese snacks, protein based food preparations; edible oils and fats including salad oil, peanut oil, soybean oil, canola oil, olive oil, vegetable oil, sunflower oil, oil for cooking; margarine and shortenings; cooking fat; butter; cream Class 30: preparations made from cereals, bread, pastry and confectionery; snack foods of all kinds in this class; breakfast cereals, cereal and vegetable derived food products to be used as a snack food; meal replacements, including cereal based food bars; corn based cereal based snack foods, including granola based snack bars, rice based snack foods, wheat based snack foods; ready to eat cereal derived food bars; nutritional supplement bars; carbohydrate based food preparations, muesli; muesli bars; oats, oatmeal; extruded snack foods including corn snacks, corn chips, rice snacks; crackers; pretzels; candied nuts; popped popcorn; microwave popcorn; popcorn bars; sauces; salsas; dips and spreads; baking products including flour and cake mixes; pancake mixes; bread premixes; dessert mixes; plain and self-raising flour; cornflour; custard powder; baking powder; pre-mixed food products derived from grains including cakes; pancakes; pikelets; pudding mixes; gravy mixes; ready to eat cakes and other grained based bakery products; bread; bread crumbs; muffins; biscuits and cookies; pastry; cakes; pies; flans; tarts; waffles; cheesecakes; puddings; pastries; frozen and chilled unbaked pastry and pastry filled products; prepared meals in this class including frozen; chilled and unbaked meals; foodstuffs in this class used as ingredients for prepared meals; savoury pies and savoury pastries; health foods TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 33 of 36 Statement of use The mark is being used or proposed to be used, by the applicant or with his/her consent, in relation to the goods/services Status Registered Filed on 26 July 2006 Trade mark no. 752033: Trade mark Trade mark name CC'S Trade mark type Combined Classes 29 and 30 [Nice classification Schedule 8] Goods Class 29: snack foods of all kinds in this class, including dehydrated fruit snacks, dehydrated fruit and gummy confections, fruit based snack foods, fruit substitute based snack foods, nut based snacks, fruit and nut based snack foods, snack mix consisting primarily of processed fruits and/or processed nuts, dried fruit snacks, potato crisps and chips, cheese dips and cheese snacks, protein based food preparations; edible oils and fats including salad oil, peanut oil, soybean oil, canola oil, olive oil, vegetable oil, sunflower oil, oil for cooking; margarine and shortenings; cooking fat; butter; cream Class 30: preparations made from cereals, bread, pastry and confectionery; snack foods of all kinds in this class; breakfast cereals, cereal and vegetable TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 34 of 36 derived food products to be used as a snack food; meal replacements, including cereal based food bars; corn based cereal based snack foods, including granola based snack bars, rice based snack foods, wheat based snack foods; ready to eat cereal derived food bars; nutritional supplement bars; carbohydrate based food preparations, muesli; muesli bars; oats, oatmeal; extruded snack foods including corn snacks, corn chips, rice snacks; crackers; pretzels; candied nuts; popped popcorn; microwave popcorn; popcorn bars; sauces; salsas; dips and spreads; baking products including flour and cake mixes; pancake mixes; bread premixes; dessert mixes; plain and self-raising flour; cornflour; custard powder; baking powder; pre-mixed food products derived from grains including cakes; pancakes; pikelets; pudding mixes; gravy mixes; ready to eat cakes and other grained based bakery products; bread; bread crumbs; muffins; biscuits and cookies; pastry; cakes; pies; flans; tarts; waffles; cheesecakes; puddings; pastries; frozen and chilled unbaked pastry and pastry filled products; prepared meals in this class including frozen; chilled and unbaked meals; foodstuffs in this class used as ingredients for prepared meals; savoury pies and savoury pastries; health foods Statement of use The mark is being used or proposed to be used, by the applicant or with his/her consent, in relation to the goods/services Status Registered Filed on 26 July 2006 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 35 of 36 Schedule 2: Details of Griffin’s Foods Limited’s New Zealand trade mark application: Trade mark registration number 984544 CC'S Trade mark Classes 29 and 30 [Nice classification Schedule 10] Goods Class 29: Meat, fish, poultry and game; meat extracts; preserved, dried, cooked fruits and vegetables; jellies, jams, fruit sauces; milk and milk products; edible oils and fats; snack foods in this class, potato chips, nuts and coated nuts. Class 30: Farinaceous foods; flour and preparations made from cereals; food consisting primarily of grains, corn, cereal or other vegetable material including corn chips, tortilla chips, pita chips, rice chips, rice cakes, pretzels, puffed and extruded snacks; biscuits including crackers; cakes; pastry; bread; snack foods in this class; chocolate and chocolate products; confectionary including frozen confectionary; salad dressings, mayonnaise; mustard; vinegar, sauces, condiments; snack food dips. Statement of use The mark is being used or proposed to be used, by the applicant or with his/her consent, in relation to the goods/services Status Abeyance Application date 16 September 2013 TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033 Page 36 of 36 Schedule 3 – media kit TM Nos 149111, 173987, 173988, 293733, 293734, 316068, 316069, 752029, 752033