Trade Mark News & Information

Trademark Lawyer Sydney – Full Federal Court – Caesarstone Appeal

Ceramiche Caesar S.p.A v Caesarstone Ltd [2020] FCAFC 124 (28 July 2020)

Successful appeals by Ceramiche Caesar SpA (Italian company) against registration of the CAESARSTONE word and Logo marks of Caesarstone Ltd (Israeli company).

This resolved an ongoing dispute between the two businesses involving three related matters.

The Full Federal Court (Nicholas, Burley and Thawley JJ) overturned the primary judge, Robertson J whose judgement is reported at https://www.selfmark.com.au/trademark-lawyer-federal-court-caesarstone/

The primary judge, Robertson J had previously:

  1. Found in favour of the Israeli company for a limited description of goods and overturned the Registrar’s decision upholding the Italian company’s opposition to registration in class 19 of the CAESARSTONE word mark by the Israeli company.
  2. Found in favour of the Israeli company for a limited description of goods and services and overturned the Registrar’s decision upholding the Italian company’s opposition to registration in classes 19, 20, 35 and 37 of the Caesarstone Logo mark by the Israeli company.
  3. Found in favour of the Israeli company for a limited description of services and declined to cancel its trade mark registration for the word mark CAESARSTONE in classes 35 and 37.

The Italian company appealed each of the orders by the primary judge. The parties agreed that the result of the first appeal will entirely determine the result in the second appeal and almost entirely determine the result in the third appeal.

Background

The Italian company owns a trademark registration dating from 23 November 2004 for the CAESAR Logo mark shown below and covering “ceramic tiles for indoor and outdoor use” in class 19.

The Italian company commenced selling ceramic wall and floor tiles in Australia under the CAESAR Logo mark in 1988.

The Israeli company owns an earlier trademark registration dating from 28 December 2000 for the word mark CAESARSTONE and covering “Worktops, sinktops; work surfaces and surrounds for kitchens, bathrooms, vanity units and offices, counter tops; table tops; bar tops; tops and facing surfaces for furniture, reception desks and reception areas” in class 20. This trademark registration was not part of the dispute.

The Israeli company’s application for the word mark CAESARSTONE subject of the first appeal was filed on 2 June 2005 and was accepted for “Panels for floors, floor coverings, wall cladding, ceilings; non-metallic covers for use with floors and parts thereof; profiles and floor skirting boards; none of the foregoing being in the nature of tiles” in class 19. At the time of filing, this application also covered “tiles”.

The Israeli company’s application for the Caesarstone Logo mark shown below and subject of the second appeal was filed on 19 November 2007 ( with priority from 26 August 2007) and accepted for “Panels for floors, floor coverings not in the nature of tiles, wall cladding, flooring not in the nature of tiles, and ceilings; non-metallic covers for use with floors and parts thereof not in the nature of tiles; profiles and floor skirting boards; slabs formed of composite stone for building panels, counter tops, vanity tops, floors, stairs, and walls” in class 19; “Worktops, sinktops; work surfaces and surrounds for kitchens, bathrooms, vanity units and offices, counter tops; table tops; bar tops; tops and facing surfaces for furniture, reception desks and reception areas” in class 20; “Wholesale and retail services; wholesale and retail stores and wholesale and retail showrooms featuring tops and facing surfaces, work surfaces, surrounds, tiles, panels, floor coverings, wall cladding, flooring, ceilings, slabs and tiles formed of composite stone for building panels, counter tops, vanity tops, floors, ceilings, stairs, and walls; provision of commercial information relating to the aforesaid goods; offering consulting, support, marketing, promotional and technical assistance in the establishment and operation of distributorship, dealership, franchising, wholesale and retail stores that feature tops and facing surfaces, work surfaces and surrounds, tiles, panels, floor coverings, wall cladding, flooring, ceilings, slabs and tiles formed of composite stone for building panels, counter tops, vanity tops, floors, ceilings, stairs and walls” in class 35; and “Installation, maintenance and repair services of worktops, sinktops, work surfaces and surrounds for kitchens, bathrooms, vanity units and offices, counter tops, table tops, bar tops, tops and facing surfaces for furniture, reception desks and reception areas, tiles, panels for floors, floor coverings, wall cladding, flooring, ceilings, non-metallic covers for use with floors and parts thereof, profiles and floor skirting boards, slabs and tiles formed of composite stone” in class 37.

The Israeli company’s trademark registration for the word mark CAESARSTONE subject of the rectification action was filed on 19 November 2007 ( with priority from 26 August 2007) and covers “Wholesale and retail services; wholesale and retail stores and wholesale and retail showrooms featuring tops and facing surfaces, work surfaces, surrounds, tiles, panels, floor coverings, wall cladding, flooring, ceilings, slabs and tiles formed of composite stone for building panels, counter tops, vanity tops, floors, ceilings, stairs, and walls; provision of commercial information relating to the aforesaid goods; offering consulting, support, marketing, promotional and technical assistance in the establishment and operation of distributorship, dealership, franchising, wholesale and retail stores that feature tops and facing surfaces, work surfaces and surrounds, tiles, panels, floor coverings, wall cladding, flooring, ceilings, slabs and tiles formed of composite stone for building panels, counter tops, vanity tops, floors, ceilings, stairs and walls” in class 35 and “Installation, maintenance and repair services of worktops, sinktops, work surfaces and surrounds for kitchens, bathrooms, vanity units and offices, counter tops, table tops, bar tops, tops and facing surfaces for furniture, reception desks and reception areas, tiles, panels for floors, floor coverings, wall cladding, flooring, ceilings, non-metallic covers for use with floors and parts thereof, profiles and floor skirting boards, slabs and tiles formed of composite stone” in class 37.

The Israeli company commenced selling engineered quartz polymer products in slab form for work tops and surfaces in Australia under the CAESARSTONE mark in 1998. From 2003, these slabs were distributed in Australia through two distributors, namely Tessera and its sub-licensee, Carsilstone. An Australian subsidiary, Caesarstone Australia, was formed in 2006.

Tessera and Carsilstone did not generally sell the Caesarstone slabs directly to individual consumers, but instead sold the slabs to stonemasons who would convert the slabs into finished products, including benchtops and countertops, vanities and surrounds and splashbacks, and sell the finished product to consumers. There has never been a dispute between the parties in relation to Caesarstone’s right to use and register the Caesarstone trade mark for these products.

The respective trade marks had been coexisting in Australia, but the dispute arose from the Israeli company’s attempt to extend its activities from work tops and surfaces to flooring and wall claddings, including splashbacks, which have the same function as the Italian company’s ceramic tiles.

Decisions by Registrar

In the first appeal, the Registrar’s delegate upheld the opposition under s44 based on the Italian company’s earlier registration for the CAESAR Logo mark. The delegate considered the Israeli company’s non-tile floor and wall claddings were similar goods to ceramic tiles. He also took the view that, in the context of these goods, the CAESARSTONE trade mark was deceptively similar to the registered CAESAR Logo mark. The delegate formed the view that the likelihood of deception or confusion is very high and declined to favourably exercise the honest concurrent use or other circumstances provisions in favour of the Israeli company.

In the second appeal, the Registrar’s delegate also upheld the opposition under s44 based on the Italian company’s earlier registration for the CAESAR Logo mark. The delegate regarded the Israeli company’s applied for goods in class 19 to be similar to those covered by the Italian company’s earlier registered CAESAR Logo mark, but its class 20 goods were sufficiently different. The delegate also regarded the Israeli company’s class 35 retail and wholesale services and class 37 installation, maintenance and repair services were, insofar as they extended to services provided in relation to ceramic tiles, closely related to the ceramic tiles covered by the Italian company’s registered CAESAR Logo mark. Not surprisingly, the delegate also considered the applied for CAESARSTONE Logo trade mark was deceptively similar to the Italian company’s earlier registered CAESAR Logo mark. The design element in the applied for mark did not make any appreciable difference to the comparison of the respective marks. The memorable and essential feature of both trade marks is the word CAESAR.

The delegate then went on to consider whether the Israeli company could satisfy the ‘honest concurrent use’ exception, but formed the view that the use being relied upon was not use of the composite mark sought to be registered. Rather, the Israeli company’s evidence related to use of the plain word CAESARSTONE and an earlier composite mark.

In case he was wrong on that aspect, the delegate went on to consider the Israeli company’s evidence. However, much of the evidence related to quartz slabs for use on work tops. The flooring applications for these slabs was after the relevant 2007 priority date. The delegate found that “any concurrent use of the trade marks is minimal, and either dated after the priority date, or was not in relation to the conflicting goods and services”. The delegate was also not prepared to apply the “other circumstances” exception even though the Israeli company had an earlier registration for its CAESARSTONE trade mark in class 20 covering worktops and work surfaces. The Israeli company’s evidence was insufficient to justify registration for the extended applications of its quartz slab products.

Primary judge

Robertson J, at first instances, made some general findings.

His Honour found that, in most cases, the Italian company used the CAESAR Logo beneath the word CERAMICHE and that word would be readily understood as equivalent to the English word CERAMIC which lacks distinctiveness. This was not use as a composite mark. Rather, the word CAESAR was of first importance in recalling this mark.

His Honour considered a splashback is a wall cladding. Further, what is or is not a tile is largely answered by reference to the dimensions of the material in question. An unfabricated slab is not a tile but, once shaped by a stonemason into panels for floors or wall cladding, it then becomes in the nature of a tile. Class 19 is the correct class for the Israeli company’s slabs.

Robertson J found the applied for CAESARSTONE word and Logo marks of the Israeli company were deceptively similar to the Italian Company’s registered CAESAR Logo mark.

The class 19 goods of the Israeli company are similar to those class 19 goods covered by the Italian company’s registered CAESAR Logo mark. Further, the Israeli company’s class 35 and class 37 services are closely related to the class 19 goods covered by the Italian company’s registered CAESAR Logo mark because they include such services in respect of tiles.

The absence of actual confusion in the market does not support the Israeli company’s contention that the respective marks and the designated goods and services are relevantly distinguishable.

First appeal – opposition to CAESARSTONE word mark

Given the findings that the applied for CAESARSTONE word mark is deceptively similar to the Italian company’s registered CAESAR Logo mark and covers similar goods, the s44 ground of opposition was upheld.

Robertson J then went on to find the s44(4) prior continuous use provision could be applied. His Honour found the Israeli company had used its CAESARSTONE word mark continuously from April 2001 for splashbacks (and necessarily for walling and wall cladding) and flooring. There was also continuous use, from 2001, by the Israeli company’s Australian licensees of the CAESARSTONE word mark for wholesale services (but not retail services) in class 35. It’s Australian licensees also offered technical and warranty assistance including repairs and installation advice to consumers continuously from at least 2002. Importantly, this was authorised use of the CAESARSTONE word mark under the control of the Israeli company.

Nonetheless, his Honour found the Italian company could trump this by relying on s58A and its continuous use of a deceptively similar mark, namely its CAESAR Logo mark, in Australia from an earlier time, namely 1988.

However, s58A does not prevent the operation of the honest concurrent use provision under s44(3)(a) and Robertson J found in favour of the Israeli company on this; although his Honour did not consider it appropriate to apply the “other circumstances” provision under s44(3)(b) in favour of the Israeli company. After considering discretionary factors, his Honour indicated that the Israeli company’s class 19 goods should be limited to panels for floors, floor coverings and wall cladding formed of composite stone slabs; none of the foregoing being in the nature of tiles.

Robertson J rejected the Italian company’s contention that the Israeli company did not have an intention to use the CAESARSTONE word mark due to it entering a limitation to its specification that all of its relevant goods were not in the nature of tiles. That limitation did not subtract all content from the words which precede it.

Second appeal – opposition to Caesarstone Logo mark

Robertson J considered the swirl device element in this Logo mark was insignificant and his Honour’s findings in relation to the CAESARSTONE word mark applied equally to the Logo mark. However, the Israeli company could not rely on honest concurrent use or prior continuous use before the 26 August 2007 priority date and so his Honour upheld the opposition under the s44 ground as the applied for mark was deceptively similar to the Italian company’s registered CAESAR Logo mark and covered similar goods and closely related services.

However, Robertson J considered it appropriate to apply the “other circumstances” provision under s44(3)(b) given the CAESARSTONE word mark was to proceed to registration for limited goods and the desire for conformity. His Honour ordered the CAESARSTONE Logo mark to proceed for with the specifications in classes 19, 35 and 37 limited to be in keeping with composite stone slabs not being in the nature of tiles.

Rectification action against CAESARSTONE word mark registration in classes 35 and 37

As a preliminary issue, Robertson J found the Italian company was a ‘person aggrieved’ and had standing to seek rectification.

Rectification under s88(2)(a) may be sought on any grounds on which registration of the trade mark may have been opposed. The Italian company relied on the same grounds as those discussed above under the first appeal.

His Honour’s conclusions regarding the CAESARSTONE word mark for class 19 goods subject of the first appeal applied to the rectification action against the CAESARSTONE word mark in respect of the services in classes 35 and 37. Robertson J also found that, as at the 26 August 2007 priority date, there was continuous use by the Israeli company of the CAESARSTONE word mark for wholesale services but not retail services in class 35. For class 37, there was continuous use for maintenance and repair services, but not for installation services. However, the Italian company had superior rights under s58A by virtue of is earlier use since 1988 of its CAESAR Logo mark for ceramic tiles.

His Honour did not directly discuss whether the Israeli company could rely on honest concurrent use of the CAESARSTONE word mark for wholesale services and/or maintenance and repair services relating to its composite stone slabs, splashbacks, wall cladding and flooring products; although it may be inferred from the general findings that it could do so.

A further ground of rectification under s88(2)(c) is that, because of the circumstances applying at the time when the application for rectification is filed (21 December 2015), the use of the trade mark is likely to deceive or cause confusion.

Deceptive similarity of the respective marks continued as at the 21 December 2015 date of the rectification action.

Robertson J found that the Italian company had established grounds for rectification under s88(2)(a) and (c) and indicated that, subject to s89 discussed below, he would not exercise the discretion in s 88 against rectification by cancelling the registration.

Under s89 the Court may decide not to grant an application for rectification on the ground that the trade mark is liable to deceive or confuse at the relevant time if the registered owner of the trade mark satisfies the Court that the ground relied on by the applicant for rectification has not arisen through any act or fault of the registered owner. Relevant considerations are the extent to which the public interest will be affected if registration of the trade mark is not cancelled; whether any circumstances that gave rise to the application have ceased to exist; and the extent to which the trade mark distinguished the relevant services before the circumstances giving rise to the application arose.

The discretion is enlivened if the Court is satisfied that the deceptive similarity has not arisen through any act or fault of Caesarstone. Robertson J considered the emphasis here is not limited to fault but to conduct connected with the ground of deceptive similarity. There are two relevant aspects of the public interest if the registration is not cancelled. The first is the issue of deceptive similarity, including no evidence of actual confusion, and the second is the Israeli company’s use of and reputation in the CAESARSTONE word mark for the relevant services. His Honour considered the public interest will be adversely affected if the Israeli company may no longer use the CAESARSTONE word mark for its services and favoured conformity of the outcome in the first appeal involving the CAESARSTONE word mark for goods and the issue of cancellation of registration of this word mark for the relevant services. However, his Honour found that that circumstances that gave rise to the application for rectification have not ceased to exist and that the CAESARSTONE word mark did not distinguish the relevant services before the circumstances giving rise to the application for rectification arose. His Honour did not attach any significant weight to the Italian company not opposing registration of the CAESARSTONE word mark for the relevant services.

Robertson J concluded that in the circumstances of this case, there should be conformity of result in relation to registration for the CAESARSTONE word mark in respect of certain services in Classes 35 and 37.

Full Federal Court

As a preliminary matter, the Italian company had to seek leave for the first two appeals, while the third appeal could be brought as of right. Leave to appeal was granted.

First appeal – opposition to CAESARSTONE word mark

The Full Court found that the primary judge erred in concluding that there was honest concurrent use of the CAESARSTONE word mark for the accepted class 19 goods.

The Full Court accepted the Italian company’s submission that, although the primary judge found honest concurrent use in respect of floor panels and wall cladding in the nature of tiles, the specification of goods as accepted contained the limitation “none of the foregoing being in the nature of tiles”. Hence, this limitation necessarily excluded the goods subject of the honest concurrent use finding.

The Italian company also submitted that the use of the CAESARSTONE word mark by the Australian distributors was not authorised by the Israeli company. The Israeli company did not ever sell manufactured products in Australia. Rather it sold, at arm’s length, raw materials (slabs) to Tessera and Carsilstone who then sold the slabs to stonemasons who converted the slabs into finished products.  Given the finding on honest concurrent use, it was not strictly necessary for the Full Court to determine this, but their Honours did express the view, by way of obiter, that providing transport instructions and technical information regarding fabrication and installation was insufficient to show the exercise of quality control over the finished goods. Further, the evidence relied upon for the exercise of any other type of control was also insufficient. The fundamental problem was that the Israeli company supplied raw goods (slabs) which were then turned into the finished end products.

The Israeli company contended that it was also open to apply the “other circumstances” provision of s44(3)(b) and permit registration of the CAESARSTONE word mark. However, the Full Court found a number of difficulties with this, particularly given the finding that the primary judge erred in finding the Israeli company used the CAESARSTONE word mark for the designated class 19 goods where there was a limitation excluding goods in the nature of tiles.

Hence, the Full Court upheld the Italian company’s appeal and refused registration of the CAESARSTONE word mark.

Second appeal – opposition to Caesarstone Logo mark

Given the parties agreed that the resolution of the second proceeding turned entirely on the outcome of the first proceeding, the Full Court upheld the Italian company’s appeal and refused registration of the Caesarstone Logo mark.

Third appeal – rectification action against CAESARSTONE word mark registration in classes 35 and 37

Given that the Israeli company agreed this should follow the result of the first appeal, the Full Court upheld the Italian company’s appeal and cancelled the CAESARSTONE word mark registration in classes 35 and 37.

It was unnecessary to consider the Italian company’s further submission concerning discretion under s88 of the Act.