New Entrant Evades Opposition by Turning Up the Heat

The recent Assistant Commissioner’s decision Waiwera LLC v Savernake Holdings Ltd [2020] NZIPOTM 16 involved actions against some of each side’s applications or registrations, with Savernake being successful in both respects despite being yet to trade.

Savernake is the IP holding company of a group of companies that have planned the development of premium health, fitness and aged care facilities, including the provision of aged care services. Savernake applied to register WAIWERA ONE for various goods and services related to the planned development, but faced opposition by Waiwera LLC and a related party (hereinafter Waiwera LLC) in relation to the health, fitness, retirement home and aged care services. In particular, Waiwera LLC relied upon the WAIWERA ARTESIAN device mark and the word mark WAIWERA for natural mineral water and drinking water; and the WAIWERA Est 1875 device mark for advertising and promotional activities.

Savernake applied to revoke the two device marks on the basis of non-use. On the basis of the evidence provided, and in line with the strict evidential requirement, the Assistant Commissioner readily found that the WAIWERA ARTESIAN device mark had not been used during the relevant 3-year non-use period. In the case of the WAIWERA Est 1875 device mark use was claimed on the basis of the mark being used on promotional t-shirts. However, the Assistant Commissioner rejected that, noting that use of a mark to promote goods does not constitute use for advertising and promotional services. Other promotional use was found to involve marks that differed from the mark as registered to an extent sufficient to not constitute use of the registered mark. Hence, given that no special circumstances were pleaded, both device marks were revoked for non-use.

Savernake applied to invalidate the word mark WAIWERA on various grounds that relate to the mark being a geographical signifier. A notable precursory issue was whether all those grounds were available given that the invalidity application was filed exactly 7-years from the deemed date of registration. Under section 75 of the Trade Marks Act 2002 a mark is deemed to be valid and subject to restricted grounds for invalidity after the expiration of 7-years from the deemed date of registration. The Assistant Commissioner readily found that section did not apply in this case as the invalidity application was not filed after the expiration of 7-years.

Waiwera LLC obtained registration of the mark on the basis of acquired distinctiveness. However, Savernake led evidence to the effect that Waiwera LLC misled the examiner into accepting the mark. Waiwera LLC claimed the mark had been continuously used by the various owners in relation to bottled water since 1875, but the evidence available showed that water bottling ceased in the early 1900’s and only resumed in 1992. Further, the prior owner of the thermal resort and pools complex who resumed water bottling in 1992 never used the mark WAIWERA on its own. Also, the aquifer that Waiwera LLC draws the water from is not exclusive to them and others who draw water from the aquifer also have rights to commercial use of that water. On the basis of this evidence the Assistant Commissioner held that the mark had been registered in bad faith given the misleading evidence of acquired distinctiveness and that given its geographical significance other traders would reasonably expect to be able to use the mark in relation to water.

Given the revocation and invalidity findings those registrations were not available for the purposes of Waiwera LLC’s opposition to Savernake’s accepted applications. Consequently, the relative ground of opposition under section 25(1)(b) could only rely on registrations for WAIWERA ARTESIAN SPRING in relation to amusement park services; amusement parks; animal parks and reserves (zoos); leisure park services; theme park services; and caravan parks. However, those services were found to be distinct to the services in Savernake’s applications and so the section 25(1)(b) ground failed.

For the absolute ground of opposition under section 17(1)(a) Waiwera LLC could also in principle rely on its unregistered marks, which included the marks Waiwera, WAIWERA and device marks in which WAIWERA is the predominant feature. However, the Assistant Commissioner found that only the WAIWERA mark in relation to bottled water met the threshold for awareness test as there was no evidence establishing that the other marks had a reputation in their own right as they were only shown in use with other marks. After finding WAIWERA and WAIWERA ONE to be phonetically and visually similar the Assistant Commissioner found bottled water to be complementary to health and fitness services, but not to retirement home services. However, in considering the surrounding circumstances of other traders rights to use WAIWERA, the Assistant Commissioner applied precedent to the effect that for a non-distinctive mark being used in relation to complementary goods or services is insufficient for establishing a real risk of confusion. Hence, the section 17(1)(a) ground failed, and consequently so did the Fair Trading Act, passing off and bad faith grounds.

In relation to the relative ground of opposition under section 25(1)(c) of using a mark that would be prejudicial to the interests of the owner of a well-known mark, the Assistant Commissioner noted that there was evidence of significant sales and spending on advertising. However, this was held to be insufficient to establish well-known status, and that further evidence such as market research or declarations from retailers may have assisted Waiwera LLC’s case in that respect.

The prior use ground also failed due to the low distinctiveness of the WAIWERA mark, which could not thereby count as prior use of WAIWERA ONE.

Author: Quinn Miller

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