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2020

Pipers Bulletin 2020-8

Contents

  1. General

Australia

IP Australia Confirms Forthcoming Fee Changes

Subsequent to IP Australia’s release of its Cost Recovery Implementation Statement (CRIS) in late 2019 IP Australia has now confirmed the fee changes that will take effect from 1st October 2020.

The majority of the fee changes are as were previously notified. Notable fee changes include:

Patents

Currently renewal fees increase in 5-year blocks after the first block which is 6-years long. From 1st October 2020 renewal fees will be due from the 5th anniversary instead of the 4th anniversary, but will increase every year of the patent term (by increasing amounts), which collectively will result in increased revenue from renewals.

The current excess claim fee of $110 for every claim in excess of 20 at the point of acceptance will increase to $125 for every claim in excess of 20 up to and including the 30th claim and $250 for every additional claim thereafter. The current excess claim fee of $110 for every claim in excess of 20 following amendment after acceptance will increase to $250. The preliminary search and opinion fee will go from $2200 to $950 and the fee for filing applications by non-preferred means will increase by $100.

Trade Marks

Applications filed by approved means without using pick-list terms for the goods and services will be charged $400 per class instead of the current $330 per class, while the fee will remain at $250 per class for pick-list applications. Applications filed by other means will be charged $450 per class, up from $350.

The fee for entering Australia from a Madrid Protocol application will increase from $350 to $400 per class.

The fee for requesting a hearing will be reduced, but the daily fee for being heard in person will increase, resulting in an overall increase in fees for hearings heard in person that last for 2 or more days.

Designs

The fee for filing applications by non-preferred means will increase by $100. For applications containing more than one design relating to a product or products belonging to the same Locarno class the fee for every extra design will be reduced from $250 to $200 if filed by preferred means or otherwise increase to $400.

Renewals will increase from $320 to $400 if filed by preferred means and from $370 to $450 if filed by non-preferred means.

Plant Breeder’s Rights

The fee for filing applications by non-preferred means will increase by $100. Renewals will increase from $345 to $400 if filed by preferred means and from $395 to $450 if filed by non-preferred means. The fee for the designation of a qualified person (who performs various verifying and supervisory roles in relation to the plant breed) will increase from $50 per year to $240 for 3-years, as will the renewal their designation.

Trans-Tasman IP Attorneys

The application and renewal fees for Trans-Tasman IP Attorneys would increase by $50.

  1. Patents

PCT

Forthcoming PCT Fee Changes for Australia and New Zealand

Effective from 1st September 2020 the International Filing fees will change for Australia and effective from 1st October 2020 the International Filing fees will change for New Zealand. The table below gives the changes in the equivalent amounts in AUD and NZD: (PCT Newsletter; 2020/8)

PCT Intl Filing Fees

Intl Filing Fee

Fee per sheet over 30

PCT-EASY Reduction

(Varies according to electronic format)

Current Fee (AUD)

2,150

24

323 – 485

Fee from 01/09/2020

2,043

23

307 – 461

Current Fee (NZD)

2,288

26

344 – 516

Fee from 01/10/2020

2,162

24

325 – 488

Effective from 1st September 2020 the NZD equivalent amount for an International Search carried out by the USPTO will change as indicated below. (PCT Newsletter; 2020/8)

ISA (Currency = NZD)

Intl Search Fee (Current)

Intl Search Fee (01/09/2020)

USPTO (Large Entity)

3,496

3,246

USPTO (Small Entity)

1,748

1,623

USPTO (Micro Entity)

874

811

Effective from 1st September 2020 the Handling fee for an International Examination carried out by IP Australia, will change as indicated below. (PCT Newsletter; 2020/8)

IPEA (Currency)

IPEA Handling Fee (Current)

IPEA Handling Fee (1/09/2020)

IP Australia (AUD)

323

307

  1. Trade Marks

New Zealand

Court of Appeal Confirms ‘Actual’ v ‘Notional’ Use Distinction

In 2020 NZCA 306 Pharmazen Limited v Anagenix IP Limited the Court of Appeal confirmed that the likelihood of actual use is not relevant to discharging the onus of establishing lack of deception or confusion on a notional use basis.

In 2010 Anagenix achieved registration for its brand ACTAZIN in relation to kiwifruit powder in classes 5 and 29. Its product was sold in New Zealand for a short period in 2012, but a business decision was made to only sell into overseas markets on account of potential patent infringement. In 2016 Pharmazen applied to register ActiPhen, which relevantly included kiwifruit powder in class 5. After being accepted by IPONZ it was opposed by Anagenix principally on account of being likely to deceive or cause confusion under sections 25(1)(b) and 17(1)(a).

In assessing the section 25(1)(b) ground the Assistant Commissioner readily found the goods to be similar and that the marks are visually and phonetically similar, and concluded that a significant number of relevant consumers would likely be caused to wonder when seeing the ActiPhen mark in the absence of the ACTAZIN mark. Whereas section 25(1)(b) is assessed on a notional use basis, section 17(1)(a) is assessed on the basis of actual use. Given that ACTAZIN was only marketed to the New Zealand public for a short period in 2012 the Assistant Commissioner found that there was insufficient evidence of awareness to satisfy the reputational threshold under section 17(1)(a).

Pharmazen appealed to the High Court, where the Judge essentially arrived at the same conclusions under sections 25(1)(b) and 17(1)(a). The Judge also rejected Pharmazen’s contention that the distinct findings under sections 25(1)(b) and 17(1)(a) showed inconsistency by the Assistant Commissioner, and that it is in line with Court of Appeal precedent (under the Trade Marks Act 1953) to the effect that under section 25(1)(b) actual use and reputation in the opposer’s mark is not relevant.

Before the Court of Appeal Pharmazen contested both the section 25(1)(b) finding that ActiPhen is deceptively or confusingly similar to ACTAZIN, aned the distinction between notional use and actual use in the determination of that section. In the latter respect Pharmazen took particular issue with the application of that distinction where the opposer’s mark is not currently or likely to be marketed to the New Zealand public, arguing that the determination of whether the New Zealand market is likely to be deceived or confused needs to take into account the likelihood of the opponent participating in the market.

The Court of Appeal noted that while sections 17(1)(a) and 25(1)(b) use similar language and do not explicitly employ any respective distinction between actual use and notional use, that there is a long history of the Courts employing that distinction on account of the different purposes of the two sections. The purpose of section 17(1)(a) is to protect the public from deception or confusion, whereas the purpose of section 25(1)(b) is to protect the proprietor’s registered mark from the registration of a deceptively or confusingly similar mark. While the applicant can avoid section 25(1)(b) if they receive the consent of the registered proprietor, there is no such equivalent for section 17. For the public to be at risk of deception or confusion there must have been actual use of the registered mark. By contrast the purpose of protecting the proprietor’s interest in their registered mark can be satisfied by considering the likelihood of deception or confusion when the applicant’s mark is used in a normal and fair manner in a notional market.

The Court of Appeal also noted that requiring actual use in the New Zealand market for section 25(1)(b) purposes would mean that use of the mark for export would not be relevant, which is inconsistent with sections 7(1)(b) & (c), which deem the use of a mark for export purposes to be use in New Zealand. The Court of Appeal considered it would be paradoxical that sections 7(1)(b) & (c) can save Anagenix’s mark from a finding of non-use, but the same export use could not be relevant for section 25(1)(b) purposes. It was further noted that the infringement provisions of section 89 also only requires consideration of the likelihood of deception or confusion when the applicant’s mark is used in a normal and fair manner in a notional market, and that were Pharmazen’s mark to be registered they would have a defence to a finding of infringement.

In considering the similarity of ActiPhen to ACTAZIN the Court of Appeal found there to be sufficient similarities to conclude that they are relevantly similar and that the effect of some of the differences would depend upon how the words are pronounced. As both marks are invented words with no apparent meaning the conceptual comparison is neutral. Both marks are of similar length, have three syllables, share the first syllable and end with the same letter.

Pharmazen contested the relevance of the first shared syllable given that the botanical name for green kiwifruit is Actinidia deliciosa and that kiwifruit contains the enzyme Actinidin. However, the Court of Appeal found there to be a lack of any persuasive evidence to the effect that ACT is a recognised abbreviation of either Actinidia or Actinidin and as such is not generic or descriptive.

The Court of Appeal found the respective parties preferred pronunciations and the pronunciations preferred by the Assistant Commissioner and trial Judge to evidence that the two words are capable of a variety of pronunciations. It noted the lack of independent or expert evidence on likely pronunciation and took the view that both marks would be pronounced with a falling inflexion, thereby reducing the relevance of the last syllable.

The Court of Appeal also found the conclusion by the Delegate of the Australian Trade Mark Office that the two marks are not confusingly similar to not be of relevance, given that the Australian legislation puts the onus is on the opposer to establish deceptive similarity, whereas in New Zealand the applicant has to establish that their mark is unlikely to deceive or confuse.

Recent Decisions Emphasise Importance of Evidence for Establishing Invalidity

Three recent decisions by the same Assistant Commissioner delivered on the same day emphasise the importance of providing relevant non-hearsay evidence in order to at least make out a prima facie case of invalidity that is capable of challenging a registrations presumed validity.

2020 NZIPOTM 13 Sunlong (NZ) Limited v Shanghai Sunlong Bus Co Limited involved Shanghai Sunlong’s application to invalidate Sunlong (NZ)’s 2012 registration for the stylised dragon device mark, principally registered in relation to buses. Shanghai Sunlong’s principle grounds for revocation are that Sunlong (NZ) – who changed their name to Sinolink NZ Ltd in 2017 – are not the true owner of the device mark, made the application to register it in bad faith, that Sinolink’s use of the mark constitutes copyright infringement and that it is likely to deceive or confuse in line with section 17(1)(a) of the Trade Marks Act.

From 2012 until several months before the revocation application Sinolink (then named Sunlong (NZ)) purchased goods from Shanghai Sunlong and a distribution agreement to that effect was entered into in 2015. Shanghai Sunlong claimed to have only found out about the prior registration in 2016 when their application for an essentially identical mark had the registration cited against it. The Assistant Commissioner found that Shanghai Sunlong established the sale of at least one bus into New Zealand bearing a substantially identical mark prior to Sinolink’s first use or Sinolink’s application date. Even in the absence of any such prior use, the Assistant Commissioner found the distribution agreement evidenced that Sinolink was not the true owner of the mark and that even though their application for the mark predated the distribution agreement it could be inferred from the terms of the agreement that their application was made in bad faith.

Shanghai Sunlong’s pleadings in relation to the copyright infringement ground were sparse and hinged upon a declaration by one of its directors to the effect that it contracted an advertising agency to devise its device mark and that copyright was transferred to it. Given Shanghai Sunlong’s extensive use of the mark this explanation would at least be plausible. However, in the absence of more objective evidence, such as the contract of engagement documentation or corroborating declarations by the advertising agency, the Assistant Commissioner held that the evidence was insufficient to establish that Shanghai Sunlong owned the copyright in the device mark. Regarding section 17(1)(a) the Assistant Commissioner held that the single sale by Shanghai Sunlong before Sinolink’s application was not sufficient to meet the reputation awareness threshold.

2020 NZIPOTM 14 Zhu Hong v The New Zealand Way Limited involved The New Zealand Way’s (NZ Way’s) application to invalidate Zhu Hong’s 2016 registration for the fern and droplet device mark, principally registered in relation to water. NZ Way’s principle grounds for revocation are that the mark is likely to deceive or confuse in line with section 17(1)(a) of the Trade Marks Act, Zhu Hong’s use of the mark constitutes copyright infringement and that the application to register it was made in bad faith.

In 1999 NZ Way, which is jointly owned by New Zealand Trade and Enterprise and the NZ Tourism Board, commissioned a design company to design a distinctive fern leaf to use as a brand. This resulted in NZ Way registering the shown fern leaf device mark in various classes, including class 32 for inter alia mineral and aerated waters and other non-alcoholic beverages.

After finding that NZ Way’s fern leaf device is sufficiently original and qualifies as a work in which copyright subsists, the Assistant Commissioner found that NZ Way commissioning of the work, as evidenced by a declaration by a director of the design company, prima facie established their ownership of the copyright. After noting that copyright infringement can occur where the allegedly copied work forms only part of the other work, the Assistant Commissioner found that a substantial part of NZ Way’s fern leaf device is reproduced. The Assistant Commissioner noted the widespread use of fern devices in the New Zealand marketplace limits the originality of any given device and that it would not take much difference to avoid infringement. While not mentioned in the decision an example of this is the New Zealand Rugby Union’s fern leaf device, which was also registered as a trade mark (before NZ Way’s mark) for numerous goods and services, including the same water related goods. The fern leaf in Zhu Hong’s device was found to be objectively similar to the NZ Way fern leaf on account of the similarity of the arrangement of features and stylisation. Regarding the causal connection requirement for infringement, the Assistant Commissioner considered that a prima facie case for copying could be inferred on the basis that it is unlikely that someone could independently design such a similar a fern device.

Regarding section 17(1)(a) the Assistant Commissioner accepted that NZ Way licensed use of the fern leaf device well before Zhu Hong’s application, but nonetheless held that NZ Way had not met the reputation awareness threshold. In particular, there was found to be insufficient evidence from prior to the relevant date regarding the scale and scope of the licensing in relation to water products, or the advertising spend or other evidence that would allow a reasonable inference about the reputation NZ Way had in the device mark.

The bad faith ground also failed as the Assistant Commissioner found there to be insufficient evidence regarding Zhu Hong’s intention at the time of applying to register the mark or that would otherwise allow an inference that it fell short of reasonable standards of commercial behaviour.

2020 NZIPOTM 15 Le Hoang Diep Thao v Cong Ty Co Phan Dau Tu Trung Nguyen involved Cong Ty Co Phan Dau Tu Trung Nguyen’s (DTTN’s) application to invalidate Le Hoang Diep Thao’s (Diep Thao’s) 2017 registration for the shown device mark, principally registered in relation to coffee. DTTN’s principle grounds for revocation are that the mark is likely to deceive or confuse in line with section 17(1)(a) of the Trade Marks Act, and that the application to register it was made in bad faith.

DTTN claimed to have prior used various marks, all of which incorporate the G7 element and some of which incorporate the shield element. However, the Assistant Commissioner held that DTTN failed to establish that it has a reputation in its marks in New Zealand. In particular, without visitor numbers the website www.vietnamesecoffee.co.nz does not establish the scale of awareness of the G7 marks, no invoices, receipts or advertising spend evidence was provided, nor any evidence from independent sources. While the website includes a Facebook comments section, none of the comments specifically refer to the G7 brand. Further, the website is not DTTN’s, but is said to be run by a distributor of DTTN, leading the Assistant Commissioner to find that it has not been clearly established who produces the products mentioned on the website. This was further reinforced by the website (and DTTN’s name) containing references to Trung Nguyen even though there is a device mark registration for TRUNG NGUYEN in respect of coffee in the name of a third party.

The bad faith ground also failed as the Assistant Commissioner found there to be insufficient evidence regarding Diep Thao’s intention at the time of applying to register the mark or that would otherwise allow an inference that it fell short of reasonable standards of commercial behaviour. Something more than an allegation that Diep Thao ought to have known of DTTN’s alleged use is required to establish a prima facie case of bad faith.

About the Firm

Pipers IP
Address 1st Floor, Imagetext House, 3 Owens Road, Epsom, Auckland 1023, New Zealand
Tel 64-9-919 9450
Fax 64-9-919 9454
Email patents@piperpat.com
Link www.piperpat.com

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