Uncontested appeal leads to the registration of the a2 Milk and TRUE A2 trade marks

What you need to know

• In an uncontested appeal, the Federal Court has ordered the trade mark applications filed by the a2 Milk Company for a2 Milk and TRUE A2 to proceed to registration. 
• Lion Dairy and Drinks had successfully opposed the Applications before the Trade Marks Office on the basis that each mark lacked sufficient distinctiveness. The parties subsequently reached a settlement and had sought orders by consent for the Applications to proceed to registration. 
• The TMO declined a request from a2MC to issue a letter indicating that it had no objection to its decisions being set aside. To resolve the "legitimate uncertainty" created by the position adopted by the TMO, the Federal Court agreed to hear the matter. 
• Without the benefit of contradictory argument, Justice Bromwich concluded that the Applications were sufficiently inherently adapt to distinguish because the term a2/A2 did not amount to a direct description but rather made an allusive reference to a2MC's products and their qualities. 
• Justice Bromwich also noted that the additional evidence filed by a2MC which included historical marketing surveys and expert lexicology evidence, clearly distinguished the company's products from other businesses. 

What you need to do

• Even when a trade mark dispute is settled by the parties, the Court may still be required to deliver a judgement on the matter, particularly if there are ongoing public interest considerations. 
• Securing registration of a word mark is likely to afford substantial competitive advantage and providing evidence from a multitude of sources to support the use and reputation of a mark can be a convincing way to obtain that registration.

Most milk in Australian supermarkets contains a mixture of both A1 beta-casein and A2 beta-casein milk proteins. The A1 milk proteins are said to produce digestive problems for some consumers. 

The a2 Milk Company (a2MC) sells baby formula and fresh milk which do not contain A1 protein, under brand names featuring the term a2/A2. 

a2MC applied to register the word marks a2 Milk and TRUE A2 (Applications) covering a range of dairy goods. A trade competitor, Lion Dairy and Drinks (LD&D) opposed the Applications under section 41 of the Trade Marks Act 1995 by contending that because "A2" held a descriptive meaning, each mark lacked the sufficient level of distinctiveness required to distinguish a2MC's products. 

The Trade Marks Office (TMO) accepted LD&D's arguments and refused the registration of the Applications on the basis that:

• the a2 Milk mark would generally have been understood in the marketplace as indicating that the milk component of the designated goods contained only A2 beta-casein protein; and
• the word "true" in the TRUE A2 mark simply emphasised the descriptive meaning of "a2", namely that of a product that does not contain A1 beta-casein protein. 

a2MC sought an appeal of the TMO's decisions to the Federal Court. In the meantime, the parties reached a settlement. The appeal was therefore heard in circumstances where: 

• the Court had been notified by LD&D that it no longer wished to participate in the proceedings; and
• the parties had sought orders by consent that the Applications proceed to registration.

Because of the public interest considerations relevant to the issue of distinctiveness, the Court was not in a position to make such orders based solely on the agreement between the parties. In two cases with a similar set of circumstances, the public interest concerns had been addressed by the trade mark applicant obtaining a letter from the TMO that indicated the Trade Marks Registrar did not oppose the original decisions being set aside. 

Relying on this guidance, a2MC sought a similar letter from the TMO. However in this case the request was declined, with the Deputy Trade Mark Registrar concluding that she "was unable to issue a letter indicating that she has no objection to the decisions of her Delegates being set aside." 

Justice Bromwich was satisfied that this left some legitimate uncertainty as to the fate of the Applications. Therefore in the interests of certainty and finality and having regard to the de novo nature of each appeal proceeding, Justice Bromwich decided to accede to a2MC's request to hear the matters. 

Justice Bromwich noted that a2MC had "assisted the Court to a considerable degree, wisely advancing its own interests" by filing a substantial body of evidence including:

• historical survey evidence obtained to inform a2MC's activities (which the Court distinguished from surveys conducted for litigation evidence which was prone to fall foul of outcome bias);
• expert lexicology evidence as to the use in the community of the term A2;
• expert marketing evidence to analyse the educative, as well as persuasive impact of a2MC's advertising and related strategies; and
• visual evidence as to how a2MC's products appear on supermarket shelves. 

While giving "the usual degree of weight" to the Registrar of Trade Marks' decisions, Justice Bromwich was satisfied, on the evidence before him and without the benefit of contradictory argument, that the terms a2/A2 make an allusive reference to a2MC's products and their qualities but are not directly descriptive. Justice Bromwich considered that a use of the term 'A2' by another trader to do more than identify that their product contains A2 bovine beta-casein protein would not be properly motivated and there was  accordingly no reason to deny the registration of the Applications.

Justice Bromwich also commented that the evidence of past use before the priority dates of the Applications and the intended continuing use clearly established that the a2 Milk and TRUE A2 marks would operate to distinguish a2MC's goods from those of other traders.

Justice Bromwich concluded that it was appropriate to order that each Application proceed to registration.