No surprises but a New Zealand removal case provides a good warning about the scope of removal actions

No surprises but a New Zealand removal case provides a good warning about the scope of removal actions

No surprises but a New Zealand removal case provides a good warning about the scope of removal actions

A recent New Zealand revocation case (aka non-use) demonstrates just how far the adage of “use it or lose it” applies to actions for partial revocation of a trade mark registration in Unilever PLC v Amazon Technologies Inc. [2020] NZIPOTM 17, proving that in New Zealand, peas are not in fact as alike as two peas in a pod – depending upon how they are processed.

In this case, Amazon applied for removal of Unilever’s New Zealand registration No. 74364 SURPRISE on the grounds of non-use. The parties agreed that Unilever had only used the mark on “dried peas”, noting that its registration covered a much broader range of goods in class 29.[1]

The entire case became an argument about peas. Specifically, Amazon wanted the registration restricted to “dried peas”. Unilever asserted that its registration should remain for “peas, namely dried, frozen and canned peas”.

The Guiding Principles in Partial Revocation

The Assistant Commissioner summed up the issues as follow:

The issue is what is a fair description of the goods on which the trade mark has been used? The interests of the owner, the applicant for revocation and the public must be taken into account … Revocation is commonly referred to as the ’use it or lose it’ provision of the Act …  Finding a fair description of the goods on which the mark has been used is a balancing exercise. In Decon Laboratories Ltd v Fred Baker Scientific Ltd Pumfrey J noted, ’[t]here is a balance to be held between the proprietor, other traders and the public having regard to the use which has in fact taken place.’“[2]

He then identified the key principles in revocation actions as follows:

  • the need to keep the register clear of unused registrations or registrations with excessively broad specifications;
  • the interest of the (revocation) applicant not being left with an unjustified exposure to infringement;
  • the owner’s interest in protecting its brand, (so that) consumers are not being deceived or confused by use of another trade mark;
  • the owner being entitled to commercially realistic protection, remembering protection is for the specific goods described and, by way of the test for infringement, extends to similar goods; and
  • an overly narrow specification may open the way for third party traders to use a confusing or deceptive trade mark without fear of infringement and deceive and confuse the public.[3]

There is no bright line distinction between dried, frozen and canned peas[4]

Few people apart from Trade Mark Attorneys are likely to lose sleep over assessing whether “dried peas” and “peas” are the same thing. However, the Assistant Commissioner needed to consider exactly that concept and did so at some length, as did Unilever and Amazon. Both sides provided fair and reasonable assessments to support their position, including citing a raft of relevant cases. Quite correctly, the Assistant Commissioner noted that whilst these cases are helpful, they “must not become a distraction at the expense of the necessary focus on the particular use and surrounding circumstances of the case”.[5]

The Assistant Commissioner concluded that there are different points of sale within a food retailer for dried, frozen or canned goods and that the processing of the aforementioned goods is different, concluding that the difference between fresh, preserved, dried, frozen and canned food “is a commercial one[6] and is neither “arbitrary or overly pernickety”.[7] As such, the Assistant Commissioner concluded that the revocation action was successful and that the coverage should be restricted to “dried peas”.

Are there any problems here?

The Assistant Commissioner’s conclusion included an assessment on potentially infringing use of the SURPRISE mark in relation to other vegetables or other types of peas (i.e., such as dried or frozen). He concluded that any such use may potentially be brought “within the penumbra of trade mark infringement”. However, whilst correct, such use would only constitute indirect trade mark infringement, allowing the hypothetical infringer to escape infringement if its use of SURPRISE were not likely to deceive or confuse.

In such a hypothetical case, if SURPRISE were used for frozen or canned peas and accompanied by prominent use of another mark (i.e. the third party’s house mark) it may be difficult to establish trade mark infringement, if there is little perceived risk of deception or confusion. This difficulty would not occur if the infringing SURPRISE-badged goods were covered by the trade mark registration.

A warning for brand owners in New Zealand

This case demonstrates that even when a registered mark has been used in New Zealand, its coverage may be trimmed so dramatically and specifically by a revocation action to threaten the scope of the effective enforceable protection afforded by its registration.

New Zealand is not Australia – again

This case demonstrates the difference between Australian and New Zealand trade mark law once more. Although a similar result may have been achieved in Australia, it is more likely that the Registrar’s discretion would have been exercised to maintain Unilever’s registration for “peas” generally.

Furthermore, in Australia brand owners can consider applying for a defensive trade mark registration to cover broader goods for a trade mark registration that can never be challenged for non-use. By way of example, in Australia, Unilever could potentially register SURPRISE as a “defensive” mark for peas and vegetables generally. If granted this special type of registration can never be challenged for non-use – an option not present in New Zealand[8]

The case is also an important warning sign for holders of New Zealand trade mark registrations. Specifically, even if the brand owner has been using its registered mark in New Zealand, the lack of discretion in a New Zealand revocation case coupled with this laser-like focus upon the goods for which the mark has actually been used, make the power of a revocation action in New Zealand much more significant than its Australian counterpart.

[1] (preserved, dried, frozen, canned, pre-cooked foods in this class but not including preserved vegetables)

[2] Paragraphs 5, 26 and 27

[3] Paragraph 36

[4] Paragraph 70

[5] Paragraph 63

[6] Paragraph 79

[7] Paragraph 82

[8] And one which admittedly, may not exist in Australia for much longer, if proposed changed to Australian trade mark law ever progress.

Next article Flagrant copyright infringement: Boomerang Investments Pty Ltd v Padgett (Liability) [2020] FCA 535 (24 April 2020)