Full Court overturns Federal Court decision on registrability of foreign terms

In Modena Trading Pty Ltd v Cantarella Bros Pty Ltd ([2013] FCAFC 110, September 30 2013), the Full Court of the Federal Court of Australia has allowed an appeal against a decision of the Federal Court upholding a claim of trademark infringement and dismissing all cross-claims for cancellation. 

Cantarella Bros Pty Ltd was the owner of the Australian trademarks ORO and CINQUE STELLE. Relevantly, in Italian, the word 'oro' means 'gold', while the expression 'cinque stelle' means 'five stars'. Modena Trading Pty Limited is the importer of Molinari coffee products, some of which used the words 'oro' and 'cinque stelle' on their packaging and in other marketing materials. Cantarella brought trademark infringement proceedings against Modena. Modena denied trademark infringement and cross-claimed for cancellation or removal of the marks under Sections 88 and/or 92 of the Trademark Act.

Justice Emmett found at first instance that there was infringement and rejected the cross-claim by Modena. Modena had argued, on the question of whether the marks were inherently adapted to distinguish the goods of Cantarella under Section 41 of the act, that the words 'oro' and 'cinque stelle' are words that other traders might, without improper motive, want to use as "varietal indicators" on their Italian-style coffee products. Emmett J concluded that the words were adapted to distinguish on the basis that the extent of Italian speakers was not so wide that the words 'oro' and 'cinque stelle' would be sufficiently well understood. His Honour relied in part on the determination of 'distinctive' from Johnson and Johnson Australia v Sterling Pharmaceuticals Pty Ltd ((1991) 30 FCR 326): "what is important is that a significant number of consumers in the relevant market identify the plaintiff's goods as coming from one trade source".

The Full Federal Court overturned the decision of Justice Emmett. With respect to the question of whether a mark is inherently adapted to distinguish, the Full Court noted the decision of Kitto J in Clark Equipment Co v Registrar of Trademarks ((1964) 111 CLR 511):

"the question whether a mark is inherently adapted to distinguish [is to] be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motive – in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess – will think of the word and want to use it in connexion with similar goods in any manner which would otherwise infringe a registered trademark granted in respect of it."

The court went on to summarise (at 83) the test for distinctiveness, somewhat inconsistently to the above statement of Kitto J, as focusing on the likelihood of traders in the relevant goods or service thinking of, and wanting to use, the words "in suit, although not as a mark".

The court concluded that there were a number of factual findings which would support the conclusion that a trader would wish to use the ORO and CINQUE STELLE marks in relation to their coffee, such as:

• the fact that the marks were suggestive of something of highest quality;
• the strong association between 'pure coffee' and Italy;
• the number of Italian speakers in Australia; and
• the fact that many coffee traders has used the words to describe their coffee in the past.

Further, the court noted that a number of Trademark Office decisions support the conclusion that, where a word would not be registrable in its English form, a similar objection should exist to any foreign language version of that word.

For these reasons, the court concluded that the marks ORO and CINQUE STELLE were not inherently adapted to distinguish under Section 41 of the Act and ordered that the registrations be cancelled.

James Gonczi, Allens