Dick Smith Investments Pty Ltd v Ramsey  FCA 939 (12 August 2016)
Successful appeal by Dick Smith overturning the Registrar’s decision reported here and finding that the OZEMITE trade mark had been used in good faith during the three year period ending on 1 May 2011.
By way of background, the OZEMITE trade mark had been registered since 28 October 1999. There was considerable publicity relating to the launch of a yeast and vegetable extract spread as a competitor to the iconic Vegemite brand of spread. However, due to difficulties in obtaining suitable brewers’ yeast and developing the desired taste from ingredients sourced from Australian suppliers, sales did not commence until mid 2012.
In the intervening period, Ramsay launched its AUSSIEMITE brand of yeast spread in or around January 2001. He was intent on beating Mr Smith to the market in the belief that ‘the first to market won’. Ramsey subsequently obtained trademark registration of AUSSIEMITE on 8 November 2006 with effect from 7 May 2001 under the ‘other circumstances’ provisions. Dick Smith opposed registration of the AUSSIEMITE trade mark but that action was unsuccessful.
Although the OZEMITE spread was not sold or offered for sale at any time during the relevant three year period, Katzmann J found that the OZEMITE trade mark had been used in the required sense by virtue of pre-launch publicity, specifically where Mr Smith appeared in a skit on The Chaser’s ABC television program in August 2010 and in an interview with Mr Smith on radio station 5AA in Adelaide on 28 March 2011.
Her Honour reviewed the authorities and rejected Ramsey’s argument that there needs to be ‘an occasion of trade’ in respect of ‘vendible articles’ which requires at least a single act of sale to constitute relevant trade mark use. Rather, good faith use of a trade mark in the course of trade includes steps antecedent to a sale or the offering of sale. Katzmann J was satisfied that, notwithstanding the various setbacks in developing the OZEMITE product, Dick Smith had an objectively ascertainable commitment to producing a vendible product and had invested considerable funds in the development of this product. Her Honour considered the purpose of the television and radio appearance by Mr Smith was to revive, if not maintain, interest in the OZEMITE product amongst potential purchasers. These appearances revealed uses of the OZEMITE trade mark in ‘association with the goods in the course of their production and preparation for the market’. Each appearance involved use of the OZEMITE trade mark in good faith sufficient to rebut the allegation of non use.
Katzmann j went on to consider whether there were any circumstances that were an obstacle to use of the OZEMITE trade mark and agreed with the Registrar’s delegate that Dick Smith could not rely on this provision as an excusable reason for non use. The evidence relied upon was too imprecise to persuade her Honour that difficulties in sourcing brewers’ yeast was an obstacle to use during the relevant three year period. The setbacks in producing a product with a taste similar to that of the Vegemite product could not be characterised as arising from or comprising events external to Dick Smith or independent of its will. It is worth noting that her Honour expressed some doubt as to the correctness of the three conditions formulated by Drummond J in the Woolly Bull case, but reached no concluded view on this.
Her Honour also concluded, by way of obiter dicta, that even if the pre launch publicity was insufficient to constitute good faith use of the OZEMITE trade mark during the relevant period, she would have exercised discretion in Dick Smith’s favour and found that it is reasonable to not remove this trade mark from the Register. Dick Smith was not idle in the period since registration of the OZEMITE trade mark and there was a credible explanation for much, if not all, of the delay. At all material times, there was an ongoing intention to use the OZEMITE mark and the commitment of resources to achieve this. Her Honour also accepted that the OZEMITE mark has a residual reputation derived from the lengthy period during which it had been sporadically publicised and sales of the OZEMITE product since its launch after the relevant three year period were substantial.
Katzmann J clearly attached greater weight to the reliability of Mr Smith as a witness and expressed no confidence in Mr Ramsey’s evidence. Her Honour found that Ramsey settled upon the AUSSIEMITE brand some time after Mr Smith published his intention to develop his OZEMITE yeast spread. He was aware of Dick Smith’s application for trademark registration of OZEMITE and must have recognised the potential for consumer confusion by adopting a brand which was homophonous to OZEMITE. Indeed, in all likelihood, he desired to capitalise on that confusion. Removal of the OZEMITE trade mark from the Register is potentially conducive to public confusion. Indeed, there was some evidence of actual confusion following a controversial advertisement for the AUSSIEMITE product. Her Honour concluded:
There is likely to be less confusion if the OZEMITE mark remains on the Register, than if it is removed. The extent of publicity generated by Mr Smith over many years, including the extraordinary publicity given to the Ozemite name at the time of its conception, suggests that for many years to come a product which has the identical sound will be associated, at least in the minds of a not insignificant number of people, with Mr Smith. The best way of dispelling the notion that AUSSIE MITE is a Dick Smith product is to enable the two products to compete for attention on the supermarket shelves where consumers can see clearly which is the Dick Smith product and which the Ramsey one.