Federal Court’s Decision on ‘EVENPAY’ (29-Jan-2019)
A Red-Letter Day for Red Energy?
With a recent decision by the Federal Court of Australia regarding a Trade Mark case, we might be seeing further relaxation of the requirements for trade mark registration.
In its 21 September 2018 decision regarding an appeal from Red Energy Pty Ltd, the court allowed a registration for the trade mark EVENPAY for a wide variety of services, including financial services.
The mark in question combines two common words, ‘even’ and ‘pay’, which could ordinarily be used in a sentence for financial services (e.g. ‘We even pay your bills online for convenience.’). In the appeal, Red Energy made a number of submissions which were noted by the Judge as being helpful. These submissions included the following points:
(a) EVENPAY does not appear to directly describe or indicate ‘the kind’ of Goods and Services covered by the Application as it is too abstract to perform that function, even in respect of the class 36 services which include financial services.
(b) The EVENPAY mark appears to be formed from a combination of two words in a syntactically unusual way. The absence of a space between the words also arguably reinforces the distinctiveness of the mark.
(c) The EVENPAY mark appears to be evocative, not descriptive. In this respect, the word ‘EVEN’ does not appear to be the natural descriptor for payments of an equal amount.
The Court ruled found that EVENPAY did not have an ordinary meaning or signification in respect of the designated goods and services. In paragraph 13 of the judgement, the Judge noted:
(a) EVENPAY appears to present as an invented word.
(b) EVENPAY appears not to have a meaning in the context of these services that a consumer would immediately perceive.
(c) EVEN would seem to have multiple meanings, adding to the ambiguity and richness of meaning from a consumer standpoint. Those meanings include being divisible by two, level, smooth or balanced. It is also used as an adverb to give emphasis to an action, as in ‘she will even travel to…’.
(d) Further, the apparent lack of any ordinary signification or meaning appears to be reinforced by the removal of the space between EVEN and PAY.
(e) Further, whilst being formed from the combination of two words, the combination seems to me to be syntactically unusual which takes it outside of ‘the common stock’.
In paragraph 14 of the judgement, the Judge noted:
(a) The meaning of EVENPAY is not immediately apparent. In Bohemia Crystal Pty Ltd v Host Corporation Pty Ltd (2018) 129 IPR 482; [2018] FCA 235, Burley J noted that “[n]aturally, the desire of traders to use a word may depend on the perception of consumers’ understanding of it” (at [90]).
(b) Any descriptiveness of any of the designated Goods or Services is oblique.
(c) There is no evidence of third-party descriptive use of EVENPAY as at or even after the priority date, or evidence of the needs of other traders. In any event, as Mr Smith points out, such evidence would be more appropriately considered in the context of an opposition proceeding or a removal proceeding.
(d) Further, other traders have a universe of alternative marks to choose from.
In this case, the Registrar chose not to file any submissions or evidence to oppose the Appeal. The judge did, however, have the finding of the trade mark decision at hand.
In our opinion, this is a great decision for trade mark applicants as it supports the case for combined common word marks, also called ‘portmanteau’ words (two words telescoped together).
It will be interesting to see whether the approach of the Trade mark Office will change in view of this decision.
Author: Eric Badong