NEW ZEALAND: Court Rules on the Effect of Non-Use Actions Lodged Against Cited Trademarks

NEW ZEALAND: Court Rules on the Effect of Non-Use Actions Lodged Against Cited Trademarks

NEW ZEALAND: Court Rules on the Effect of Non-Use Actions Lodged Against Cited Trademarks

This article first appeared in the INTA Bulletin and was reprinted with permission from the International Trademark Association (INTA).

On March 19, 2019, the Court of Appeal of New Zealand held that trademarks which are cited as objections to a trademark application but which are subsequently removed from the Trade Marks Register cannot obstruct the registration of a trademark, in International Consolidated Business Pty Ltd v. SC Johnson & Son Inc, CA72/2018 [2019] NZCA 61.

S C Johnson & Son Inc. (Johnson) applied to register the ZIPLOC trademark in International Class 16 (covering bags, including plastic bags; kitchen tidy bags and garbage bags; plastic bags for food storage, snacks and sandwiches; plastic freezer bags and plastic bags for medical products; cling wrap). The Intellectual Property Office of New Zealand (IPONZ) raised the prior registration for the identical ZIPLOC mark, belonging to International Consolidated Business Pty Ltd. (ICB), as a citation objection against Johnson’s application for the same mark. Three days after Johnson applied to register the ZIPLOC mark, it applied successfully for the removal of ICB’s ZIPLOC registration, which resulted in IPONZ accepting Johnson’s application to register the ZIPLOC trademark.

Subsequently, ICB successfully opposed Johnson’s application for the ZIPLOC mark, on the basis that its registration was still valid when Johnson applied to register the identical mark, notwithstanding that ICB’s registration was removed some four days later.

Johnson appealed to the High Court of New Zealand, which used its discretion to backdate removal of ICB’s ZIPLOC registration to a date prior to Johnson’s own ZIPLOC application.

ICB appealed to the Court of Appeal of New Zealand, which provided an extensive analysis of the relevant legislation relating to non-use “revocation” actions in New Zealand, before concluding that “the critical date for consideration of the state of the register is the actual date of entry on the register,” that is, the date upon which an application proceeds to registration. The court thus concluded that the fact that Johnson’s ZIPLOC application was filed three days prior to the effective date of removal of ICB’s ZIPLOC registration “had no bearing on the validity of Johnson’s application.” In other words, the presence of “zombie” marks should not obstruct the registration of a trademark in New Zealand if the zombie marks are removed subsequently.

The court went on to consider whether first use of the trademark effectively determines ownership permanently, or whether such a claim may be lost through cessation of use. The court held that if a registered trademark is removed because of non-use, any claim to ownership of that trademark can only be determined by the use subsequent to the non-use period.

Interestingly, this development appears to apply a statutory time limit to common law claims of ownership of a trademark in New Zealand through trademark use. Until now, the courts have not set a specific period for trademark ownership claims in which, under common law, use has ceased.

Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest. Law & Practice updates are published without comment from INTA except where it has taken an official position.

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