Cantarella Bros Pty Limited v Modena Trading Pty Limited  HCA 48 (3 December 2014)
The High Court has handed down its decision in the much awaited appeal as to whether the trade marks ORO and CINQUE STELLE were properly registered by Cantarella for coffee products.
The trial judge had previously found the registrations to be valid and infringed by Modena. This was overturned by the Full Federal Court.
Cantarella’s appeal was confined to the validity of its trade mark registrations. The High Court (by majority French CJ, Hayne, Crennan and Kiefel JJ, with Gageler J dissenting) has upheld Cantarella’s appeal and found its ORO and CINQUE STELLE trade marks were ‘inherently adapted to distinguish’ and validly registered as of 24 March 2000 and 6 June 2001 respectively.
It was not in dispute that “oro” is an Italian word meaning “gold” and “cinque stelle’ are Italian words meaning “five stars”.
The High Court agreed with Cantarella that inherent adaptation to distinguish is tested primary by checking the ordinary meaning (ordinary signification) of these words at the time of registration and the target audience is anyone ordinarily purchasing, consuming or trading in the relevant goods. The test as to the likelihood that other traders might legitimately desire to use these words in connection with their goods is a secondary consideration and only comes into play where the relevant word is understood as having a directly descriptive meaning. The Court stated, at paragraph 71:
As shown by the authorities in this Court, the consideration of the “ordinary signification” of any word or words (English or foreign) which constitute a trade mark is crucial, whether (as here) a trade mark consisting of such a word or words is alleged not to be registrable because it is not an invented word and it has “direct” reference to the character and quality of goods, or because it is a laudatory epithet or a geographical name, or because it is a surname, or because it has lost its distinctiveness, or because it never had the requisite distinctiveness to start with. Once the “ordinary signification” of a word, English or foreign, is established an enquiry can then be made into whether other traders might legitimately need to use the word in respect of their goods. If a foreign word contains an allusive reference to the relevant goods it is prima facie qualified for the grant of a monopoly. However, if the foreign word is understood by the target audience as having a directly descriptive meaning in relation to the relevant goods, then prima facie the proprietor is not entitled to a monopoly of it. Speaking generally, words which are prima facie entitled to a monopoly secured by registration are inherently adapted to distinguish.
The words “oro” and “cinque stelle” were not shown, by Modena’s evidence, to convey a meaning or idea sufficiently tangible to anyone in Australia concerned with coffee goods as to be words having a direct reference to the character or quality of the goods. The test as to the likelihood of other traders legitimately desiring to use these words does not apply to words which convey an allusive or metaphorical meaning.
Gageler J referred to the language of s41 giving effect to the public policy “that a trader ought not to be allowed to obtain by registration… a monopoly in what other traders may legitimately desire to use”. His Honour considered the focus of the test imported by the words “inherently adapted to distinguish”, now in s 41 of the Act, is on the extent to which the monopoly granted on registration of a trade mark would foreclose options otherwise available to rival traders acting in the ordinary course of their businesses without any desire to benefit from the applicant’s reputation.
Gageler J agreed with the Full Federal Court that the evidence indicated the words gold and five stars, when used in respect of goods or services, signify quality and the Italian equivalents of those words were not inherently adapted to distinguish.