Fredco Trading Ltd v Miller
CA 20/05, Court of Appeal
Glazebrook, Robertson and Ellen France JJ
3 July 2006
This was an unsuccessful appeal from the High Court’s dismissal of Fredco’s challenge to the validity of the registration of the respondent’s shape mark - a “Klipon” plastic kiwifruit vine tie. A representation of the mark is set out below. The 2002 Act expressly includes shapes in the definition of “sign” in s5.
In the High Court, Venning J considered the mark against the various prohibitions on registration contained in s18. Section 18 provides that a mark that has no distinctive character may still be registrable if, as a result of use made of it or other circumstances prior to the date of application, the trade mark has acquired a distinctive character. Based on the evidence, Venning J concluded that the vine tie met the requirements of a trade mark (s18(1)(a)) but lacked distinctive character because its essential shape characteristics were largely determined by functional considerations. The mark was therefore prima facie caught by s18(1)(b). However, the Court was satisfied that there was sufficient evidence that the Klipon vine tie had acquired a distinctive character through use.
Onus of proof
As a preliminary matter, the Court of Appeal considered the onus of proof in an application for revocation. The appellant had accepted that it had the onus of showing that it was more probable than not that the mark was not registrable. However, it argued that the effect of the evidence of its expert, Dr Conroy, was to shift the evidential burden to the respondent. The respondent maintained that the evidential burden only shifted if there was evidence to overcome the prima facie validity of the registration. Dr Conroy was a branding expert giving theoretical evidence and did not consider the actual market. Accordingly, her evidence could not overcome the prima facie validity of the registration.
The Court agreed with the respondent, endorsing the discussion of onus of proof in Kerly’s Law of Trade Marks and Trade Names (14th ed). The onus lies on the party making the attack to prove the ground of invalidity to the normal civil standard on the balance of probabilities. Once established this automatically overcomes the prima facie validity (provided for in s162).
On the substantive issues, the Court of Appeal held:
- It was not necessary to decide if a functional mark can be a trade mark as the High Court finding was that the Klipon tie was largely (but importantly not purely) functional.
- The goods themselves can be the trade mark.
- The use of the product itself was relevant to the necessary enquiry of whether a functional shape has required a secondary meaning in the marketplace.
- The evidence supported identification of the Klipon tie by shape and a link to its origin.
- Overall the evidence was sufficient to show that the mark was being used as a badge of origin .
The Court upheld the High Court finding that the scale of use is a relevant but not determinative consideration in determining whether a sign has acquired distinctive character by use. It was not sufficient for the purposes of s18(2) for Miller to rely on its monopoly in the market without specific and reliable evidence of acquired distinctiveness as the result of use of the mark as a trade mark. On the facts, while the evidence was “not extensive”, the High Court had been right to conclude that s18(2) was met .
The Court also accepted that the availability of alternative shapes to achieve the same result was a relevant but not determinative consideration .
Separately the Court held that it was possible for a mark to acquire distinctiveness even as part of another mark (citing the European Court of Justice in the Société des Produits Nestlé SA v Mars UK Limited C-353/03). On the facts, the market was not a “limping mark” propped up by the “Klipon” name [81-2].