Case: Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261 , 107 FCR 166
Outcome: followed
To fall within s 100(3)(c) it is not sufficient for the owner of a trade mark to point to circumstances peculiar to himself. There must be some circumstance which in a practical business sense caused the non-use of the mark: Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261 , 107 FCR 166. Drummond J there summarised the approach to be adopted as follows: [46] It can be accepted that the wording of s 100(3)(c) was deliberately adopted to give the subsection a wider operation than the narrowly worded provision contained in s 23(4) of the 1955 Act. It is now not necessary to show unusual or abnormal, as opposed to normal or usual, trading conditions (a difficult concept to comprehend and apply) before s 100(3)(c) can operate. Ordinary incidents of the trade cycle commonly encountered by traders, as well as abnormal ones, are now within the provision. Further, it is clear that a circumstance of a trading nature that has an impact only on the registered owner can also now be relied on to justify non-use of the mark. [47] In the context of s 100(3)(c), there are, however, good grounds for reading "circumstances" as not embracing any event of any kind. The circumstances must be "an obstacle to the use of the trade mark by the registered owner". This suggests that they must arise from or comprise events external to the registered owner in the sense of not having been brought about by the voluntary act of the owner. [48] But if any circumstance external to the owner, in the sense of being a circumstance not brought about by the voluntary act of the owner, is within the provision, the Court would be drawn into inquiries of a kind that it is difficult to accept were in the contemplation of the Parliament. Financial impecuniosity could excuse non-use of a trade mark, irrespective of how enduring and intractable the owner's impecuniosity might be. Illness of the registered owner could also excuse non-use of the registered trade mark (as is the contention of the applicants here). A falling out between joint registered owners of a mark that disrupts the use by either of the mark might also be capable of excusing non-use. In all such situations, questions could arise requiring investigation by the Court into whether the obstructing circumstances were due to the conduct of the registered owner. [49] If the Parliament intended any circumstance external to the owner to be capable of providing an excuse for non-use, little purpose would be served by the words in parenthesis in s 100(3)(c), namely, "whether affecting traders generally or only the registered owner of the trade mark". The presence of these words is some indication that the circumstances comprising an obstacle to use of the mark must not only arise externally to the registered owner, but must also be circumstances of a trading nature. His Honour considered that s 100(3)(c) was " sufficiently obscure " to occasion recourse to extrinsic material, including the Second Reading Speech . His Honour continued: [54] It is apparent from these extrinsic materials that s 100(3)(c) was not intended by the Parliament to provide a defence to an attack on a registered trade mark for non-use on any grounds, including grounds entirely personal to the trade mark owner that do not bear any trading character, so long only as they do not arise from the voluntary actions of the owner. [55] In my opinion, circumstances within s 100(3)(c) will only exist when events arise that are capable of disrupting trade in the area of commercial activity in which goods bearing the registered owner's mark are traded. For the statutory excuse to be made out, those circumstances must cause (in a practical business sense) non-use of the particular mark by the owner, whether or not they have an impact on any persons other than the owner of that mark who are also involved in that same area of commercial activity. There must be a causal link shown between the relevant circumstances and the mark's non-use. This requirement arises from the fact that s 100(3)(c) creates an excuse only where the mark has not been used by the registered owner "because of" circumstances etc. It will not assist the opponent to removal to show the existence of an impediment to use of the kind referred to in s 100(3)(c) if he does not also establish that, but for that impediment, he would have used the mark. Compare Re James Crean &amp; Son Ltd's Trade Mark [(1921) 38 RPC 155] at 162. [56] Circumstances that do not have a trade character but which only affect a mark owner in his personal character, such as illness afflicting the owner of the mark that is sufficiently disabling to prevent the owner using the mark, can never therefore found an answer within s 100(3)(c) to an application for removal of the mark for non-use. 167 In the present proceedings there were undoubtedly discussions between Gallo Winery and McWilliams Wines as to the launch in Australia of BAREFOOT wine. But by May 2007 the negotiations had not proceeded beyond just that, negotiations. Compare: Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261 at [40] , [2001] FCA 261 ; 107 FCR 166 at 179. There was unquestionably an intention to launch BAREFOOT wine in Australia " in around September 2007 ". But, and unlike the position in Buying Systems , there had been no step taken during the non-use period comparable to the placing of advertisements or the printing of letterheads or business cards. The only step which had been taken was the unilateral step taken by McWilliams Wines to allocate some of its wine. Gallo Winery was pleased that such a step had been taken as it preserved the possibility of a launch in September 2007. That was a step taken, however, by McWilliams Wines and not by Gallo Winery. 168 Gallo Winery , it is considered, had only engaged in preliminary or preparatory acts: Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261 at [28] , [2001] FCA 261 ; 107 FCR 166 at 175 per Drummond J. See also: Burrell R, The Requirement of Trade Mark Use: Recent Developments in Australia (2005) 16 AIPJ 231 at 238. 189 A single use during the non-use period, it should be accepted, is sufficient: Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261 at [14] [17], [2001] FCA 261 ; 107 FCR 166 at 171 2 per Drummond J. 190 And " good faith " means a real as opposed to a token use in a commercial sense. It requires a " substantial and genuine " use: NSW Dairy Corporation v Murray Goulburn Co-operative Co Ltd (No 1) (1989) 14 IPR 26 at 45. Gummow J concluded: In these circumstances, it is clear that in the three year period ending 6 June 1988 (being the period specified in s 23(1)(b)) the moo mark had been used by the registered proprietor not only in relation to cheese, but also in relation to flavoured milk in the sense required to preserve the registration, subject only to the further requirement that the use answered the description of having been bona fide. In "Concord" Trade Mark [1987] FSR 209 ; Falconer J held that to be bona fide within the meaning of the equivalent provision in the British legislation (s 26 of the 1938 Act) use should be substantial and genuine judged by ordinary commercial standards considered in relation to the trade concerned. ... I should add that use by the first respondent would not cease to be bona fide even if the evidence had been that it used the trade mark only after it appreciated that the registration was vulnerable to an attack on the ground of non-use by reason of the lack of activity of the second respondent; nor would it cease to be bona fide, even though, as is the case on the evidence, neither the officers of the first respondent nor its patent attorney, who dealt with the second respondent at the time the assignment was taken in 1987, had enquired closely of the second respondent as to the extent of its previous user of the trade mark... Aff'd: NSW Dairy Corporation v Murray Goulburn Co-operative Co Ltd [1990] HCA 60 ; (1990) 171 CLR 363. This approach was endorsed by Drummond J in Woolly Bull Enterprises Pty Ltd v Reynolds [2001] FCA 261 at [16] , [2001] FCA 261 ; 107 FCR 166 at 171.