CROCODILE INTERNATIONAL PTE LTD v LACOSTE

Supreme Court of New Zealand William Young J, Glazebrook J, Arnold J, O'Regan J, France J 30 August 2016, 21 February 2017 [2017] NZSC 14

Trade marks – revocation – non-use – distinctive character – ss 7(1)(a) and 66(1)(a) Trade Marks Act 2002 (NZ)

Facts:

In 2008, Crocodile International Pte Ltd (Crocodile) applied to revoke Lacoste’s trade mark 70068 (the mark) under s 66(1)(a) of the Trade Marks Act 2002 (NZ) (the Act) on the grounds that no genuine use had been made of the mark for three years or more. The mark was in the following logo form:

Lacoste accepted it had never used the mark in that form. However, it relied on the extended definition of “use” under s 7(1)(a) of the Act to submit that it had registered and used other marks (the other marks) that amounted to use in a form differing in elements that did not alter the distinctive character of the mark in the form registered. The other marks were as follows:

          

The Assistant Commissioner of Trade Marks held that the registration of the mark should be revoked for non-use, rejecting Lacoste’s submission that the fact the mark and the other marks shared a “central message”, being the crocodile, could satisfy the definition of “use” under s 7(1)(a). However, the High Court and Court of Appeal disagreed and both held that Lacoste had used mark 70068 within the extended meaning of s 7(1)(a). The Court of Appeal held that the crocodile was depicted in a similar manner in the mark and the other marks, and that the main point of difference was that the crocodiles were facing in opposite directions.

Crocodile appealed to the Supreme Court. It was granted leave to appeal on the ground that the Court of Appeal erred in upholding the High Court decision to set aside the order made by the Assistant Commissioner of Trade Marks revoking trade mark 70068: Crocodile International Pte Ltd v Lacoste [2016] NZSC 88.

Held, allowing the appeal

“Use” under s 7(1)(a)

  1. The appropriate test is that set out by Lord Walker in Bud and Budweiser Budbrau Trade Marks [29]. The “three-stage” test referred to by Arnold J in NIRVANA trade mark and The London Taxi Corp Ltd is merely an elaboration of Lord Walker’s test [37]. 

    Bud and Budweiser Budbrau Trade Marks [2002] EWCA Civ 1534, [2003] RPC 25; Re Registered Trade Mark Nos 365200, 1199776 and 1384452 UK Intellectual Property Office Trade Mark Decision O/262/06, 18 September 2006; The London Taxi Corp Ltd v Frazer-Nash Research Ltd [2016] EWHC 52 (Ch), [2016] FSR 20 referred to.

  2. There is no difference in approach to determining the question of “use” under s 7(1)(a) where elements of a trade mark are removed as against where elements are added [41].

  3. A strong reputation in a trade mark may mean that greater changes can be made before distinctive character is lost than would be the case for a less established brand [52].

    Specsavers International Healthcare Ltd v Asda Stores Ltd [2014] EWCA Civ 1294, [2015] FSR 8 referred to.

  4. (obiter) The term umbra is used to denote the protection given to trade marks by stopping anyone else from using, or seeking to register, the exact trade mark registered [46]. The term penumbra is used to denote the protection given to trade marks by stopping anyone else from using, or seeking to register, a similar trade mark to the trade mark registered [46]. This protection is not as strong as the umbra [46].

    Laboratoire de la Mer Trade Marks [2002] FSR 51 (Ch); Maier v ASOS plc [2015] EWCA Civ 220, [2015] FSR 20 referred to.

  5. (obiter) In New Zealand, unlike England and Wales, appellate courts are not required to defer to the assessment of the Commissioner of Trade Marks [65]. Given the wide range of trade mark decisions that Commissioners are called upon to make, they may be expected to have a broader and more nuanced appreciation of the trade mark Register than judges, whose experience will generally be limited to the particular contested applications that come before them [66]. This may mean that, where an appeal raises this type of issue, the appellate court should hesitate to depart from the Commissioner’s qualitative assessment [66].

    Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103, [2008] 2 NZLR 141 referred to.

Application to facts

  1. The focus given by the High Court and Court of Appeal on the “central idea and message” of the trade mark did not accord with Lord Walker’s test in Bud and Budweiser Brau Trade Marks [61]. Concentrating on the central message risked ignoring or downplaying potentially significant visual differences between trade marks [61].

    Bud and Budweiser Budbrau Trade Marks [2002] EWCA Civ 1534, [2003] RPC 25 referred to.

  2. There was conceptual similarity between the mark and the other marks [72]. However there were significant visual differences between the mark and the other marks [73]. The depiction of the word “Crocodile” in cursive and on an angle in the mark was absent in the other marks [73(a)]. The animal was represented in a stylised way in the other marks and given a more realistic representation in the mark [73(b)]. The absence of an essential visual element of the mark, being the word “Crocodile”, from the other marks would in itself likely mean that the distinctive character of the mark had been altered [74].

    E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2010] HCA 15, (2010) 241 CLR 144 distinguished.

    “Residual discretion” under s 66(1) not to revoke a mark for non-use

  3. There is no residual discretion under s 66(1) of the Act not to revoke a mark for non-use [97]. The position under s 66(1) of the Act is different than under s 35 of the Trade Marks Act 1953 [93]. Even if the discretion had existed, the Court would not have exercised it in favour of Lacoste on the facts of the case [98].