Seven v 7-Eleven: key lessons for trade mark owners

In Brief - The recent Federal Court case of Seven Network (Operations) Limited v 7-Eleven Inc [2023] FCA 608 (Seven v 7-Eleven) serves as a timely reminder to Australian businesses that if they want to ensure their registered trade marks are not open to challenge, they must use the trade marks in a real commercial manner in connection with the goods and services the trade marks are registered in relation to.

Significantly, the case makes it clear that the use of a trade mark in a website domain name or on a website banner is not in itself sufficient to establish real commercial use of the trade mark. 
'Use' of the trade mark must make it clear to the reasonable consumer that the goods or services being offered are being offered by reference to the trade mark (and, by extension, by the company that owns the relevant mark).

In Seven v 7-Eleven, the Federal Court upheld in part a decision by a delegate of the Registrar of Trade Marks to remove Seven Network (Operations) Limited's (Seven) '7NOW' mark from the trade mark register in relation to certain goods and services. 

Thawley J held that Seven's use of the word '7now' within the domain name www.7now.com.au and/or its use of the 7NOW logo on a banner at the top of the webpage was not in itself enough to establish that Seven had used the 7NOW Mark in relation to the relevant goods and services.

Matter background

Seven has been the registered owner of Registered Trade Mark No 1540574 since 7 August 2013 (7NOW Mark). The trade mark was for the word '7NOW' in the following classes:

1. Class 9: Computer software
2. Class 35: Advertising including "the promotion and sale of goods and service for others…"
3. Class 38: Broadcasting services
4. Class 41: Entertainment services.

On 10 July 2019, 7-Eleven Inc (7-Eleven) filed a non-use application concerning Seven's 7NOW Mark.

On 23 March 2020, 7-Eleven applied to register its own mark which included the words '7NOW' and a figurative mark containing the words 7 NOW in relation to Class 35, 'Retail convenience stores; online retail convenience store services for a wide variety of consumer goods featuring home delivery service and in-store pickup'.

When 7-Eleven's application was examined by a delegate of the Registrar of Trade Marks, the delegate raised Seven's 7NOW Mark as a conflict. 

On 30 June 2021, a delegate of the Registrar found in 7-Eleven's favour in the non-use action, holding that Seven had not used the 7NOW Mark in relation to various goods and services in classes 9 and 35 between 24 July 2018 and 10 June 2019 (Non-Use Period). 

The Federal Court proceedings

Seven appealed the delegate's decision to the Federal Court. The key issues at trial were:

• whether Seven had used the 7NOW Mark in respect of the Defended Goods and Services during the Non-Use Period (Issue 1)
• if not, whether the Court should exercise its discretion under section 101 of the Trade Marks Act 1995 (Cth) (TMA) to remove the 7NOW Mark from the trade mark register in respect of the Defended Goods and Services (Issue 2).

The Defended Goods and Services, which 7-Eleven argued should be removed from the trade mark register due to non-use pursuant to section 92 of the TMA, were:

• computer software, from class 9
• the promotion and sale of goods and services for others, from class 35
• retail and wholesale services, from class 35
• the bringing together, for the benefit of others, of a variety of goods enabling customers to conveniently view and purchase those goods, from class 35 (Defended Goods and Services).

In response to 7-Eleven's allegations, Seven claimed that it had used the 7NOW Mark during the Non-Use Period, breaking its use into two further periods: 

• the 'redirect period' which occurred between 24 July 2018 and 1 April 2019 (Redirect Period)
• the '7NOW website period' which occurred between 1 April 2019 and 10 June 2019 (7NOW Website Period).

Throughout the Redirect Period, the domain name www.7now.com.au (which Seven owned), automatically redirected users to the 7PLUS website at www.7plus.com.au. Seven argued that this use of the 7NOW Mark was use as a trade mark about the Defended Goods and Services because the 7PLUS website made various television programs available for streaming, including programs that promoted goods and services on behalf of third parties.

Throughout the 7NOW Website Period, the domain name www.7now.com.au stopped redirecting users to the 7PLUS website and instead landed users on a standalone 7NOW page which provided links to various other websites, including streaming portals for Seven's channels and programs. Throughout the 7NOW Website Period, the 7NOW website featured a '7NOW' banner across the top of the webpage, shown below:


 
Seven argued that this use of the 7NOW Mark was use as a trade mark in relation to the Defended Goods and Services as the 7NOW website:

• advertised other publications and business which themselves offered various goods and services
• offered consumers access (by providing links) to a range of e-commerce platforms which provided retail services. 

The Court's findings

In relation to Issue 1, Thawley J held that Seven had not used the 7NOW Mark in respect of the Defended Goods and Services during the Non-Use Period. Thawley J held that the 7NOW Mark was not being used as a trade mark during the Redirect Period, as:

• Seven's use of the 7NOW Mark in the domain name www.7now.com.au was not a trade mark use (at [60])
• apart from Seven's use of '7now' in the domain name www.7now.com.au, Seven were not using the 7NOW Mark in connection with any business or commercial activity (at [60])
• Seven were not offering any goods or services in connection with the 7NOW Mark (at [61]).

Thawley J held that the 7NOW Mark was not being used as a trade mark during the 7NOW Website Period as, despite the website banner:

• the typical consumer would not consider that the 7NOW website was being used to promote or advertise the publications and businesses linked on the page; rather, the typical consumer would understand that the 7NOW website was simply hosting links by which he or she could click through to access those other businesses (see [107]-[108])
• the typical consumer would not consider that the e-commerce services linked on the 7NOW website were being offered by 7NOW, particularly because the 7NOW Mark was not used on e-commerce websites themselves (at [118]).

In relation to Issue 2, Thawley J did not consider it reasonable to exercise his discretion under section 101 as:

• removing the 7NOW Mark from the trade mark register in relation to the Defended Goods and Services would not cause any substantial prejudice to Seven's other '7-formative marks' (at [144])
• the use of '7NOW' by another entity was unlikely to cause confusion among consumers or damage Seven's private interests (at [146]) if a consumer saw the 7NOW Mark used in connection with the sale of food or goods typically found in convenience stores, which was how 7-Eleven proposed to use the mark, they would not assume a connection with Seven (at [146]).

Implications

This case demonstrates that to establish 'use' of a trade mark during a relevant period, a trade mark owner will need to point to more than use of the mark in a website domain name or website banner. 

A trade mark owner needs to show that it has offered goods and services by reference to the trade mark, and to establish that if a consumer saw the mark they would assume that the goods or services being offered are being offered by the company that owns the mark.

It is important businesses use their registered trade marks in direct connection with the goods or services that the trade marks are registered in relation to. This might include printing the trade mark on uniforms, invoices, tender documents and/or products.