Monday, December 16, 2013

Cash Converters v Webber (No 2): Res Judicata in Trade Mark Opposition Proceedings

The lamentable practice of some IP practitioners repeatedly filing trade mark applications in order to subvert the opposition process in the hope that an Opponent does not notice a second application has been the subject of scrutiny in proceedings before the Australian Trade Mark Registrar. On 10 December a decision of the Australian Trade Mark Registrar was handed down, applying res judicata to trade mark oppositions. (This is a matter in which I was Counsel for the Opponent.)

Res judicata is a fundamentally important part of the common law process. In an old English case, Re May, Brett MR stated:

“The doctrine of res judicata is not a technical doctrine applicable only to records. It is a very substantial doctrine, and it is one of the most fundamental doctrines of all courts, that there must be an end of litigation, and that the parties have no right of their own accord, after having tried a question between them and obtained a decision of a court, to start that litigation over again on precisely the same questions.”

In the decision just issued in Australia, the dispute was between two short term loan and pawn-broking services providers. The Applicant, the director of a former franchisee of the Opponent, filed an application for registration of “CASH EEZ” (stylised) in classes 35 and 36 on 10 December 2009 (First Casheez Application). The Opponent successfully opposed the First Casheez Application. The Trade Mark Registrar handed down a decision to refuse the First Casheez Application on 28 May 2013. The Trade Mark Registrar upheld the Opponent’s opposition on the basis of section 44 of the Trade Marks Act 1995 (Cth) (TMA). The Trade Mark Registrar found that “CASH EEZ” and “CASHIES” were phonetically identical and deceptively similar.

On 10 October 2011 (almost two years after the First Casheez Application was filed), the Applicant filed a second trade mark application, identical to the First Casheez Application, for the same mark (the Applicant’s Mark) in respect of the same services in classes 35 and 36 (the Second Casheez Application).

The Opponent argued that the Second Casheez Application should be refused on the basis that the Registrar’s refusal to register the First Casheez Application (Opposition Decision) gives rise to an estoppel which is determinative of this opposition. Alternatively, the Applicant should be prohibited from bringing the Second Casheez Application before the Registrar based on the legal principle of res judicata. For res judicata to apply, the Opponent said it must demonstrate that a final judgment has been made by a competent tribunal in respect of the same parties on the same subject matter which gives rise to an estoppel which is determinative of this opposition.

In Re Application of William Hunt & Sons (1911) 28 RPC 302, where two trade marks had been successfully opposed and then applied for once more by the applicant’s successors-in-title, the Registrar refused to register both trade marks on the ground of res judicata. This decision to refuse registration was upheld on appeal. The Opponent submitted that the same grounds for rejecting registration of the Second Casheez Application should be applied in this opposition.

The Opponent argued that res judicata is required in the context of trade mark registration to ensure finality in a decision of the Registrar to uphold an opposition. The Opponent should not be in a position where it has to re-argue matters already determined by a competent delegate of the Registrar. The Opponent argued that If the Applicant disagreed with the outcome of the decision to refuse registration of the First Casheez Application, the Applicant could have appealed. This second hearing is not, and should not be considered, a de facto appeal.

The Registrar’s delegate agreed, and said:

“Res judicata is essentially the principle for a judicial decision to be treated as conclusive between the parties…. The issue in this case is whether the Registrar of Trade Marks is estopped from considering the same issue previously made by the same administrative tribunal. There may be instances where decisions from delegates of the Registrar are final, involving identical parties and issues and thus where estoppel by res judicata would apply, effectively rendering the latter decision maker functus officio. In the current matter, I find that the Registrar of Trade Marks is functus officio as regards Hearing Officer McDonagh’s finding, but there remain issues she has yet to determine in relation to the opposition to the Trade Mark. Where I find that certain facts differ or there is new material not previously considered (and it is necessary to discuss it in order to reach a decision), I will address those issues.”

I’m hopeful that what this decision means is that Applicants will not try and bypass the opposition process through the opportunistic trick of filing repeated trade mark applications.

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