Full Federal Court confirms that YELLOW is descriptive of print and online directories

In the recent decision of Telstra Corporation Limited v Phone Directories Company Pty Ltd ([2015] FCAFC 156), the Full Federal Court has upheld an earlier decision of Justice Murphy by refusing to allow Telstra Corporation to register the word mark YELLOW in respect of a range of goods and services connected to telephone directories. Although the outcome was the same, the Full Court took a different approach to Murphy J on some matters and some of the more interesting parts of the judgment are considered.

Murphy J had found that YELLOW was not registrable as a trademark by Telstra as it had no inherent capacity to distinguish Telstra’s online directory and print directory-related goods and services. In short, his honour found that, as a result of the longstanding use by many traders in Australia and around the world of that word and colour for online and print directories, the colour yellow and the word 'yellow' had come to signify online and print directories. It was therefore highly likely that innocent traders would want to use the word 'yellow' to describe their directories. His honour determined that “the YELLOW trademark [refers] to a character or quality” of online and print directories.

Telstra appealed on a number of grounds. However, the two major grounds were in relation to whether or not the word 'yellow' was descriptive of print and online directories and therefore the YELLOW trademark had no inherent adaptation to distinguish the designated goods and services. Telstra’s appeal was unsuccessful as the Full Court concluded that the word 'yellow' was descriptive of the designated goods and services and, therefore, the YELLOW trademark had no inherent adaptation to distinguish the designated goods and services.

Telstra’s submission was that, even if the YELLOW mark signified the goods and services associated with the print and online directories, it was not descriptive of them. To this end Telstra contended that YELLOW was not descriptive of its print and online directory goods and services, but is instead descriptive of goods that are inherently yellow like, for example, bananas. Conversely, words that would be descriptive of the goods and services which were the subject of Telstra’s trademark application were words such as “business directories”, “advertising directories” and “classified directories”, and the YELLOW mark was not such a word.

The Full Court disagreed, finding that YELLOW was “not inherently adapted to distinguish in the same way as the examples of descriptive words for print and online directories given by Telstra of business directories, advertising directories and classified directories are merely descriptive” (at [118]).

To put it another way, if the YELLOW trademark did in fact signify print and online directories to consumers of those goods and services, then the word 'yellow' was as descriptive of those goods and services (for the purposes of the Trademarks Act 1995) in the same way as it is descriptive of a banana. 

Taking up the High Court’s approach in the recent case of Cantarella Bros Pty Ltd v Modena Trading Pty Ltd ([2014] HCA 48), Telstra attempted to argue that Murphy J had not considered the ordinary signification that the YELLOW mark would have for Australians concerned with the relevant products. The Full Court rejected this argument, noting specific parts of Murphy J’s judgment where it considered that he had clearly “addressed the ordinary meaning of the word 'yellow' and he addressed its significance in relation to print and online directories”. Telstra therefore failed to show that there was any error in Murphy J’s finding that the word 'yellow' signified print and online directories for the relevant consumers.

The judgment is also noteworthy as it deals with the standard of proof required for an opponent to be successful in stopping a trademark becoming registered. It had perhaps been unclear, as a result of competing approaches being taken by single judges, whether an opponent needed to prove that an opposed trademark should clearly not be registered, or whether they simply needed to show that, on the balance of probabilities, it should not be registered. The Full Court specified that the standard of proof is proof on the balance of probabilities.

Murphy J stated that he also would have rejected the registration of the YELLOW trademark on the grounds that it was deceptively similar to one or more of four earlier applications, in relation to comparable classes and designated goods and services. Those earlier applications included:

1. THE YELLOW ENVELOPE;
2. YELLOW DUCK;
3. YELLOW ZONE; and
4. YELLOW DOOR.

The Full Court disagreed and, instead, preferred the reasons of the delegate of the registrar of trademark who had heard the matter originally, specifically:

• Each of the earlier applications is visually distinct as a result of the inclusion of the additional noun;
• In each case the word 'yellow' “fades as a strongly distinguishing feature of the potentially conflicting trademarks in the presence of an arbitrary noun with actually distinguishes the marks”;
• Each of the earlier applications is phonetically different;
• Each of the earlier applications is aurally different; and
• In each case the additional noun gives rise to a very different idea than the abstract notion of a colour.

Therefore, the YELLOW trademark was not deceptively similar to the earlier applications.

Two of the opponents also cross-appealed in relation to Murphy J’s refusal to allow registration of a trademark they had applied for YELLOWBOOK.COM.AU in relation to an online business directory listing both contact details and advertising information. The Full Court upheld Murphy J’s judgment on this ground, finding that YELLOWBOOK was deceptively similar to YELLOW PAGES and that the addition of '.com.au' was largely insignificant for the purpose of this analysis.

Stephen Stern and Ben Mawby, Corrs Chambers Westgarth, Melbourne