Establishing trade mark ownership in Australia – EZ does (not do) it

MS Marketing Inc. v EZ Imports Pty Ltd [2019] ATMO 159 (8 November 2019)

 

The Issue

Competing companies separately engaged the services of the same Chinese contract manufacturer to produce a range of electric wheelchairs, mobility scooters and associated parts and accessories.

EZ Imports Pty Ltd (“EZ”) sought to register a trade mark in Australia which was successfully opposed by MS Marketing, Inc (“MS”) on the basis of their superior claim to ownership of the relevant mark.

The Law

In Australia, rights in a trade mark can be established either by use or by registration.  Australia’s Trade Marks Act 1995 supplements the common law where first use of a trade mark establishes a qualified right to continue that use. The right of use and to registration is limited to the specific trade mark or a substantially identical trade mark in relation to the same kind of thing as the goods for which first use can be established.

The Facts

MS engaged a graphic designer in November 2013 who designed the EZ LITE CRUISER Logo mark (as shown below). MS used that trade mark for the relevant goods in Australia from at least December 2013.  Under the terms of its agreement with the graphic designer, copyright in this logo was transferred to MS in November 2013.

 

The Trade Mark
The Trade Mark
Opponent's Trade Mark
Opponent’s Trade Mark

 

 

 

 

 

In August 2017, EZ filed an application by which it sought to register the EZ MOBI CRUISER Logo (as shown above). This was opposed by MS.  EZ claimed that it was not aware of MS or its use of the EZ LITE CRUISER Logo mark in Australia.  Further, EZ claimed that both companies sourced their wheelchairs from the same manufacturer in China and that MS only sought to register a trade mark in Australia after EZ obtained the Australian distributorship of such goods.

MS supplied a copy of their distribution agreement with the Chinese contract manufacturer (dated June 2016) which stated (inter alia) that “EZ LITE CRUISER and other such trademarks” are owned by MS.  Further, this agreement explicitly stated “that each of the marks used by MS is the exclusive property of MSand “does not grant licence, right or permission” for the Chinese contract manufacturer “to use them without obtaining MS prior written permission”.  MS did not provide such permission to either EZ or the Chinese contract manufacturer.

The Decision

The Hearings Officer found the marks shown above to be substantially identical as they shared the same “dominant cognitive cues” and “essential elements”.  The Hearings Officer found the only discernible difference between these marks were the terms “Lite” and “MOBI”, which suggested specific qualities that are generally desirable for the relevant goods, namely, that they are “Lite” (i.e. lightweight) and “Mobi(le)”.

MS were able to demonstrate that their use of the EZ LITE CRUISER Logo mark in Australia commenced well before EZ filed (or started using) the EZ MOBI CRUISER Logo mark and that their use of the EZ LITE CRUISER Logo mark in Australia was in relation to the “same kind of thing” as EZ’s goods, namely electric wheelchairs, mobility scooters and associated parts and accessories.

As a result, MS was able to demonstrate that it possessed a superior claim to ownership and the Hearings Officer refused to register the EZ MOBI CRUISER Logo mark.

The Point

A person supplying goods in Australia from a foreign manufacturer can legitimately claim ownership of a trade mark in Australia but they first need to show that they control the quality of the goods being sold and control use of the trade mark.

Beyond that ownership of a trade mark will generally be determined by ascertaining  the person who was first in time to either (i) use that mark (or a mark that is substantially identical) in Australia in relation to specific goods and/or services, or the “same kind of thing” or (ii) file an application for the trade mark covering the relevant goods and/or services.