//piperpat.com/page/listing/the-scotch-whisky-association-v-the-mill-liquor-save-ltd/important-nz-cases

The Scotch Whisky Association v The Mill Liquor Save Ltd

(2012 NZHC 3205, 30th November 2012)

The Scotch Whisky Association (SWA) appealed to the High Court after losing its opposition to The Mill Liquor Save Limited’s (MLS) application to register MACGOWANS for whisky flavoured spirits; none of the foregoing being whisky in proceedings before an Assistant Commissioner. The Judge upheld the appeal after finding SWA successful on one of its grounds.

A preliminary issue was whether five statutory declarations filed as evidence in reply by SWA could be accepted as such. The Assistant Commissioner held the evidence to be inadmissible because it was in the nature of evidence in chief as it adduced fresh facts concerning alleged confusion. SWA argued that while the evidence contained fresh facts it still qualifies as evidence in reply if it responds to the applicant’s evidence. Regulation 82 requires the opponent to file the first evidence. The Judge noted that particularly in cases involving alleged deception or confusion it is the opponent who is in the best position to file evidence first, since otherwise the applicants would have to anticipate the nature of the alleged confusion without seeing the opponent’s substantive evidence. The Judge upheld the Assistant Commissioner’s finding that the evidence was inadmissible. The applicant cannot file evidence after the opponent’s reply evidence, so it would be unfair for the opponent to file evidence in its evidence in reply that makes out the grounds of opposition. As required by regulation 85 the evidence must be strictly in reply. Further, the evidence could have been filed earlier.

The Assistant Commissioner had also rejected all of SWA’s pleadings relating to whether MLS’s MACGOWANS mark would be likely to deceive or cause confusion. A quirk of this case is that SWA does not claim the MACGOWANS mark is deceptive or confusing in relation to one of its own marks. In fact SWA has no marks of its own, it is an association set up to promote and protect the integrity of the Scotch Whisky trade description. SWA argued that the MACGOWANS mark would deceive or confuse the public into thinking that the product is or contains whisky and / or comes from Scotland. While the Judge attributed a greater variance of sophistication to the purchasing public, it was still held that the adoption of a Gaelic name is not distinctive of a Scottish product, let alone Scotch whisky. The Judge accepted that MLS’s evidence showed that any initial doubt by the purchasing public whether the product was whisky, let alone Scotch whisky, would be dispelled by a moment’s reflection on the price difference. The Judge contrasted this case with the protection available to a known trade description (such as champagne) and concluded that it was a bridge too far to grant SWA a monopoly in the use of Gaelic names for an alcoholic beverage.

Unless there is evidence or reason to believe to the contrary the applicant is given the benefit of the doubt that they will use the mark in relation to the specification as filed. However, in this case SWA argued that such a presumption is displaced by MLS’s goods only having 13.9% alcohol, which does not meet the relevant legal definition for spirits of 37% alcohol. In the earlier proceedings the Assistant Commissioner had accepted MLS’s argument that spirits should be given a broader interpretation along the lines of a dictionary definition as strong alcoholic liquor for drinking. However, the Judge held that those likely to read the specification would give the word ‘spirits’ a technical meaning, and that the specification must be consistent with the intended use. As MLS’s product cannot be labelled as a spirit, MLS’s trade mark application was not allowed to proceed to registration.