Apple Inc. v Registrar of Trade Marks  FCA 1304 (3 December 2014)
The Federal Court has dismissed an appeal by Apple and upheld the Registrar’s decision finding the words APP STORE do not qualify for trade mark registration.
The APP STORE trade mark application was filed on 18 July 2008 and claimed various retail store services featuring computer software in class 35, telecommunication services in class 38 and computer software services in class 42. Apple launched its App Store service on 11 July 2008.
Section 41 as it stood prior to the 15 April 2013 amendments (giving effect to the presumption of registrability) was applicable in determining registrability of the APP STORE trade mark.
Yates J confirmed the relevant date for determining registrability was the 18 July 2008 filing date of the trade mark application and not the earlier Convention priority date from the corresponding foreign application filed on 7 March 2008.
This decision was issued on the same day as the High Court decision in the Cantarella case where ORO and CINQUE STELLE were found to be inherently adapted to distinguish coffee products and validly registered trade marks. The High Court stated that inherent adaptation to distinguish is assessed having regard to anyone ordinarily purchasing, consuming or trading in the relevant goods/services and is tested primarily by considering whether the word(s) have a directly descriptive meaning (ordinary signification) in the context of the relevant goods/services. If the word(s) merely conveys an allusive reference, then it is prima facie qualified for registration. However, if the word(s) has a directly descriptive meaning, the enquiry is then whether other traders might legitimately need to use the word(s) in respect of their goods/services.
Yates J referred to the Full Federal Court decision in the Cantarella case which was overturned by the High Court and which applied a predominantly trader focussed test as to whether other traders were likely to legitimately desire to use the word(s). However, given his Honour’s reasoning as discussed below, it seems that the same outcome would have been reached if his Honour had the benefit of the High Court’s decision.
After considering the evidence, which included affidavits from linguistic experts, Yates J was satisfied that, “well before 2008, the word “app” had a well-established and well-understood meaning as a shorthand expression for computer software that is an application, as opposed to operating, software”. His Honour was also satisfied that, “at the time that Apple applied for the APP STORE mark, the word “store” had a well-established and well-understood meaning among traders and the general public that was not confined to the traditional notion of a physical store, but extended, as well, to an online store for the provision of goods or services”.
In the context of the class 35 retail store services, Yates J concluded as follows:
I am satisfied on the balance of probabilities that, at the filing date, members of the public seeking to acquire application software would have understood APP STORE as no more than an expression to describe a trade channel – a store – by or through which application software could be acquired. The fact that the “acquisition” would have involved the acquisition of rights by way of licence does not, in my view, bear upon the matter.
For this reason, I am also satisfied on the balance of probabilities that, at the filing date, traders would have wished to use the words “app store”, in some form, to describe, without improper motive, the same trade channel and activity in respect of computer software. In other words, I am satisfied that, at that time, other traders might have wished to use the same words, in combination, for the signification which, as a matter of ordinary language, they then possessed.
It follows that I do not accept the contention that, at the filing date, APP STORE could only be fully-understood non-compositionally. Far from it. I am satisfied that, at that time, APP STORE was not to any extent inherently adapted to distinguish the designated services in Class 35.
… even if Apple was in fact the first to use the combination “app store”, I am satisfied that, at the filing date, the words in that combination bore no more than their ordinary signification when applied to the designated services in Class 35.
… In all the circumstances, Apple has not established that, because of the extent to which it had used “App Store” before the filing date, APP STORE did, at the filing date, distinguish the designated services in Class 35 as being Apple’s services and not those of other persons. It follows that, for this reason, the application must be rejected.
In the context of the services in classes 38 and 42, Yates J concluded as follows:
My finding that the application for registration of APP STORE for the designated services in Class 35 must be rejected determines the fate of the application as a whole. This is because there are no separate applications for registration of the mark for the designated services Classes 38 and 42. There is but one application covering registration of the mark for all the services that have been specified. If the application fails in one respect, it fails as a whole. In these circumstances, is not necessary for me to proceed to determine the registrability of APP STORE for the designated services in Class 38 or Class 42.
This is a rather curious position for his Honour to take and seemingly ignores multi-class trade mark applications. It is also the Registrar’s practice to accept or reject trade mark applications for some of the goods/services as claimed. In any event, Yates J went on to comment:
I am satisfied that, considered over the range of Apple’s specification of services in Classes 38 and 42, and bearing in mind the essentially descriptive nature of the words “app store”, the mark APP STORE is not to any extent inherently adapted to distinguish those services. Further, as with the designated services in Class 35, Apple has not established that, because of the extent to which it had used APP STORE before the filing date, the mark did, at the filing date, distinguish the designated services in Classes 38 and 42 as being Apple’s services and not those of other persons.
As a result of this decision, other traders should be free to use the words “app store” as a legitimate description for application software provided from an online store. However, care needs to be taken to avoid use of these words in a trade mark sense because Apple has an earlier 2006 trade mark registration for the conjoined word APPSTORE. In that regard, Yates J commented as follows:
First, the registrability of APPSTORE is not before me for determination. I do not know the circumstances in which trade mark 1156967 came to be registered or what, if any, evidence was placed before the Registrar in that regard. Secondly, APPSTORE and APP STORE are not the same mark. It is at least arguable – I say no more – that the conjoined form APPSTORE is to some extent inherently adapted to distinguish because of that form. Thirdly, as Wilcox J observed in Ocean Spray Cranberries, marks may have been wrongly registered in the past. It is an unwarranted distraction to investigate whether that is the case in the present matter.
If Apple did seek to enforce its rights in the APPSTORE trade mark registration, presumably the validity of that registration would be challenged.
Nonetheless, Apple has, since July 2008, acquired a very strong reputation and goodwill in the words APP STORE and could also rely on this to object to use by others of these words in a misleading or deceptive manner.
Apple may also file a new application to register the APP STORE trade mark and seek to persuade the Registrar that these words have become distinctive in fact of its online store services.