Fighting to retain heritage beer brands - A CUB trade mark success story - Trademark

In the largest set of opposition proceedings in Australian trade mark history, iconic Australian brewer CUB has emerged victorious from a dispute with a rival brewer intent on assuming control of a selection of CUB's heritage brands.

INTRODUCTION

A connection with the past can be a powerful force in attracting custom. Marketers occasionally capitalise on the potency of collective nostalgia and restore classic brands to active duty on a full-time basis (MONACO BAR) or special release basis (MELLO YELLO). Once popular brands may be discontinued, but still remain in the affections of consumers (POLLY WAFFLE and TORANA).

From the brand owner's perspective, it often makes commercial sense to maintain statutory protection for discontinued or periodically used trade marks which possess substantial equity and the potential for successful redeployment.

The Trade Marks Act is often described as embodying a "use it or lose it" philosophy. Whilst that is true to a point, there are important factors that can militate against the commandeering of seemingly vulnerable brands.

Corrs is proud to have represented CUB in defeating a serious challenge to some of its much-loved heritage beer brands.

THE DISPUTE

Through Elixir Signature Pty Ltd (Elixir), Philip Withers operates Thunder Road Brewery in Brunswick, Melbourne. Another company controlled by Mr Withers, Intellectual Property Development Corporation Pty Ltd (IPDC), performs the brand-owning role for Thunder Road Brewery.

Mr Withers approached CUB in 2009 with a proposal to acquire or take a licence to use a selection of CUB's beer brands which had not been marketed for some time, but which remained of considerable value to CUB. These brands remained in the affections of a significant number of consumers and formed part of CUB's rich heritage. CUB had a track record of periodic releases of "heritage brands" and, after Mr Withers' approach, CUB filed fresh trade mark applications to enhance protection for key heritage brands.

Mr Withers and CUB could not agree on terms for Thunder Road Brewery using (or owning) any of the heritage brands. Through Elixir and IPDC, Mr Withers sought to assume control of CUB's heritage brands BALLARAT BITTER (and the associated Ballarat Bertie character), RICHMOND LAGER, BULIMBA (including the GOLD TOP brand), NQ LAGER and KENT. Elixir/IPDC's strategy included:

filing trade mark applications for the heritage brands;
seeking to remove CUB's registrations for the heritage brands on the ground of non-use; and
opposing, on grounds of "bad faith" and "lack of intention to use", CUB's freshly-filed applications for the heritage brands.

Elixir/IPDC broadened the dispute substantially by also seeking the removal of a raft of registrations for marks which CUB had not used in the previous three years and by opposing CUB's fresh applications for registration of some of those marks. This aspect of the attack included brands such as ABBOTS LAGER and TOOTHS and some historical labels for CARLTON DRAUGHT, MELBOURNE BITTER, CAIRNS DRAUGHT and BRISBANE BITTER.

At the request of the parties, the Trade Marks Office agreed to consolidate 5 of the oppositions by IPDC to CUB's trade mark applications and 54 of the oppositions by CUB to Elixir's removal applications. In its totality, the dispute became the largest set of opposition proceedings in Australian trade mark history.

Evidence spanned 32 declarations and the hearing was conducted over two days before a panel of three Delegates of the Registrar of Trade Marks. Decisions on the 59 consolidated oppositions were issued on 10 September 2013 in Intellectual Property Development Corporation Pty Ltd v CUB Pty Ltd [2013] ATMO 73 and CUB Pty Ltd v Elixir Signature Pty Ltd [2013] ATMO 74.

The sheer scale of the dispute was in large part a consequence of the removal in 2006 of the "person aggrieved" standing requirement from the non-use provisions of the Trade Marks Act. Previously, removal of a mark from the Register could only be sought by a person commercially disadvantaged by the registration. The abolition of the standing requirement meant that there was no filter in place to prevent Elixir/IPDC from filing removal applications in relation to brands in which they had no apparent interest.

THE REGISTRAR'S DECISION ON THE OPPOSITIONS TO CUB'S TRADE MARK APPLICATIONS

CUB prevailed in each of the five oppositions to its applications.

The Delegate of the Registrar declined to infer that CUB had filed its applications "purely as a defensive or tactical response to the interest Mr Withers had shown in regard to using [CUB's] prior registrations." More generally, the Delegate held that IPDC had not provided any evidence supporting the contention that CUB's filing of the applications fell short of the standards of acceptable commercial behaviour for the purposes of the "bad faith" ground of opposition.

On the issue of intention to use, the Delegate was not satisfied that IPDC's evidence shifted to CUB an onus to demonstrate an intention to use the marks. Nevertheless, the Delegate concluded that if the onus had shifted to CUB, the evidence of CUB sufficiently addressed any adverse inference that might be drawn from IPDC's evidence. The Delegate held that CUB genuinely intended to use the marks and this would be enough even if the primary motivation for filing the applications was to prevent use of the marks by Elixir/IPDC.

THE REGISTRAR'S DECISION ON THE 54 OPPOSITIONS TO REMOVAL

CUB's evidence addressed a range of factors relevant to the exercise of the Registrar's discretion including:

CUB's non-abandonment of the marks;
existence of residual reputations in the marks on the part of CUB;
use of the marks in good faith before or after the relevant non-use period;
the prospects of confusion arising from removal of the registrations; and
the respective private commercial interests of the parties.

Elixir/IPDC focussed on the public interest in clearing out unused marks from the Register and contended that CUB was "acting as a roadblock to the freedom of other Australian companies from using historical trade marks" and that the geographically descriptive nature of marks such as BALLARAT BITTER was a policy consideration favouring "freeing up" such marks for use by others.

In a resounding victory for CUB, the Delegate applied the discretion to thwart Elixir/IPDC's ambitions to gain access to particular heritage brands, concluding as follows:

CUB cannot be said to have abandoned the marks in circumstances where it had periodically used the marks before and after the relevant period and had plans for further releases.
CUB had a residual reputation in the brands.
In the beer product category where branding commonly incorporates references to the (at least initial) site of production, the geographic significance of a mark like BALLARAT BITTER is likely to sustain, rather than dilute, the residual reputation in the mark.
CUB's private interests as owner of the marks in question and successor-in-title to the original brand owners prevailed over Elixir/IPDC's "mere desire to use a trade mark which is owned by someone else" (at [132]). Mr Withers' stated objective of "setting free" unused heritage trade marks did not withstand scrutiny.
The public interest in ensuring that the Register was clear of unused marks was outweighed by the public interest in avoiding consumer confusion. Confusion was a likely product of Elixir/IPDC's use of marks which possessed a residual reputation. Confusion was particularly likely where CUB retained ownership of (and used) other marks forming part of the same brand family as the marks being challenged. The Delegate considered that "a family of trade marks all of which contain a specific and significant identifying word should travel together, that is, they should belong to a single trade source if confusion is to be avoided" (at [144]).

The Registrar's decision affirmed CUB's long-held position that its heritage brands are of legitimate ongoing interest to it and that it is not open to other traders to commence use of those brands.

RELEVANCE TO OTHER OWNERS OF HERITAGE BRANDS

For brand-owning companies, especially those with long, successful and diverse histories, the Registrar's decisions should provide support for the preservation of heritage brands which another trader seeks to exploit. There is scope for the registration of brands released intermittently to survive attack even where non-use during the relevant three year period is established. Filing fresh trade mark applications for heritage brands is also a valid strategy if coupled with an intention to use the brands even if the owner is aware of the non-use issue and aware of another trader's interest in using the brand.

A person with ambitions to adopt a heritage brand without the permission of the original brand owner (or successor in business) faces a conundrum. The affection with which that brand is recalled creates the commercial incentive to appropriate the brand and provides the very basis for thwarting such ambitions.

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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