FEDERAL COURT OF AUSTRALIA
Anheuser-Busch, Inc v Budějovický Budvar, Národní Podnik [2002] FCA 390
TRADE MARKS - alleged infringement of trade marks 'Budweiser' and 'Bud' - no infringement by use of one impugned mark, infringement by use of another - use as a trade mark - good faith for the purposes of paragraph 122(1)(a) of the Trade Marks Act 1995 (Cth) not made out - claim under section 129 of the Act for groundless threats of infringement action not made out
TRADE PRACTICES - section 52 and paragraphs 53(c) and (d) of the Trade Practices Act 1974 (Cth) - misleading or deceptive conduct - use of the corporate name of the respondent including the word 'Budweiser'
PASSING OFF - use of the corporate name of the respondent including the word 'Budweiser'
Trade Practices Act 1974 (Cth) s 52, paras 53 (c) and (d)
Trade Marks Act 1995 (Cth) ss 6, 7, 10, 17, 117, 120, 122, 129
Australian Woollen Mills Ltd v F S Walton & Co Ltd (1937) 58 CLR 641 applied
Euromarket Designs Inc v Peters & Anor [2001] FSR 288 referred to
Registrar of Trade Marks v Woolworths Ltd (1999) 45 IPR 411 applied
The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1961) 109 CLR 407 applied
Mark Foys Ltd v Davies Coop & Co Ltd (1956) 95 CLR 190 applied
Angoves Pty Ltd v Johnson (1982) 43 ALR 349 referred to
Seven-Up Co v Bubble Up Co Inc (1987) 9 IPR 259 referred to
Re Smith Hayden & Co Ltd's Application (1946) 63 RPC 97 applied
Wingate Marketing Pty Ltd v Levi Strauss & Co (1994) 49 FCR 89 applied
Johnson & Johnson v Kalnin (1993) 114 ALR 215 applied
In the Matter of an Application by the Pianotist Company Ltd for the Registration of a Trademark (1906) 23 RPC 774 applied
Cooper Engineering Co Pty Ltd v Sigmund Pumps Ltd (1952) 86 CLR 536 applied
Murray Goulburn Co-operative Co Ltd v NSW Dairy Corporation Ltd (1990) 16 IPR 289 applied
New Zealand Breweries Ltd v Heineken's Bier Brewerij Maatschappij NV [1964] NZLR 115 referred to
Pioneer Hi-Bred Corn Co v Hy-line Chicks Pty Ltd [1979] RPC 410 referred to
Parker-Knoll Ltd v Knoll International Ltd [1962] RPC 265 referred to
Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 applied and referred to
Bridge Stockbrokers Ltd v Bridges (1984) 4 FCR 460 referred to
Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191 referred to
Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45 applied
Coca-Cola Co v All-Fect Distributors Ltd (2000) 96 FCR 107 applied
Carnival Cruise Lines Inc v Sitmar Cruises Ltd (1994) 31 IPR 375 applied
General Electric Co v General Electric Co Ltd [1973] RPC 297 referred to
Mars GB Ltd v Cadbury Ltd [1987] RPC 387 referred to
In re William Bailey (Birmingham) Ltd's Trade Mark Application (1935) 52 RPC 136 applied
Re Broadhead's Application for Registration of a Trade Mark (1950) 67 RPC 209 applied
Pepsico Australia Pty Ltd v The Kettle Chip Company Pty Ltd (1996) 33 IPR 161 referred to
The Sanitas Company Ltd v Condy (1887) 4 RPC 530 referred to
Ravenshead Brick Co Ltd v Ruabon Brick & Terra Cotta Co Ltd (1937) 54 RPC 341 referred to
Seltsam Pty Ltd v McGuinness (2000) 49 NSWLR 262 referred to
Luxton v Vines (1952) 85 CLR 352 referred to
Transport Industries Insurance Co Ltd v Longmuir [1997] 1 VR 125 referred to
Australian Competition & Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 referred to
George Ballantine & Son Ltd v Ballantyne Stewart & Co Ltd [1959] RPC 273 referred to
United Kingdom Tobacco Co Ltd's Application (1912) 29 RPC 489 referred to
George Ballantine & Son Ltd v Ballantyne Stewart & Co Ltd [1959] RPC 47 referred to
Baume & Co Ltd v A H Moore Ltd [1958] RPC 226 referred to
Polo Textile Industries Pty Ltd v Domestic Textile Corporation Pty Ltd (1993)
26 IPR 246 referred to
RKH Pty Ltd v Christian Dior (1985) 6 IPR 78 referred to
Sturtevant Engineering Co Ltd v Sturtevant Mill Co of USA Ltd (1936) 53 RPC 430 referred to
Associated Rediffusion Ltd v Scottish Television Ltd [1957] RPC 409 referred to
Crystalate Gramaphone Record Manufacturing Co v British Crystalite Co Ltd (1934) 51 RPC 315 referred to
Aldi Stores Ltd Partnership v Frito-Lay Trading Company GmbH [2001] FCA 1874 applied
Johnson & Johnson Aust Pty Ltd v Sterling Pharmaceuticals Pty Ltd (1991) 30 FCR 326 applied
Musidor BV v Tansing (t/as Apple Music House) (1994) 52 FCR 363 applied
Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (2000) 48 IPR 257 applied
Wrigley's (Australasia) Ltd v Life Savers (Australasia) Ltd (1936) 37 SR (NSW) 9 referred to
Royal Brunei Airlines v Tan [1995] 2 AC 378 applied
Adrema Ltd v Adrema-Werke GmbH [1958] RPC 323 applied
Re Bali Brassiere Co Inc's Registered Trade Mark and Berlei Ltd's Application (1968) 118 CLR 128 referred to
Riv-Oland Marble Co (Vic) Pty Ltd v Settef SpA (1988) 19 FCR 569 applied
CA Henschke v Rosemount Estates Pty Ltd (2000) AIPC 91-640 referred to
In re 'Thunderbird' Trade Mark (1974) 48 ALJR 456 applied
Pioneer Electronic Corporation v Registrar of Trade Marks (1977) 17 ALR 43 referred to
S & I Publishing Pty Ltd v Australian Surf Life Saver Pty Ltd (1998) 88 FCR 354 applied
Equity Access Pty Ltd v Westpac Banking Corporation (1990) ATPR 40-994 referred to
Cadbury-Schweppes Pty Ltd v Pub Squash Co Pty Ltd [1981] RPC 429; [1980] 2 NSWLR 851 applied
Thai Wood Import and Export Co Ltd v Shuey Shing Pty Ltd (1989) 17 IPR 289 referred to
Taco Company of Australia Inc v Taco Bell Pty Ltd (1982) 42 ALR 177 applied
Parker-Knoll Ltd v Knoll International Britain (Furniture & Textiles) Ltd [1961] RPC 346 referred to
Shanahan Australian Law of Trade Marks and Passing Off (2nd Ed)
Kerly's Law of Trade Marks and Trade Names (13th Ed)
Anheuser-Busch,
Inc v Budějovický Budvar, Národní Podnik & Ors
NG 194 of 1998
ALLSOP J
5 APRIL 2002
SYDNEY
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IN THE FEDERAL COURT OF AUSTRALIA |
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BETWEEN: |
ANHEUSER-BUSCH, INC APPLICANT |
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AND: |
BUDĚJOVICKÝ BUDVAR, NÁRODNÍ PODNIK FIRST RESPONDENT F.M. LIQUOR PTY LTD ACN 009 350 378 SECOND RESPONDENT HOUSE OF HOPS (AUST) PTY LTD ACN 072 644 341 THIRD RESPONDENT |
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DATE OF ORDER: |
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WHERE MADE: |
THE COURT ORDERS THAT:
1. on or before a date to be fixed, the applicant and the first respondent file agreed proposed short minutes of order, or, failing agreement, separate proposed short minutes of order, giving effect to the reasons published today; and
2. the proceedings be stood over to a date to be fixed for argument, if any, on the form of final orders and for the making of final orders.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
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IN THE FEDERAL COURT OF AUSTRALIA |
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APPLICANT |
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AND: |
BUDĚJOVICKÝ BUDVAR, NÁRODNÍ PODNIK FIRST RESPONDENT F.M. LIQUOR PTY LTD ACN 009 350 378 SECOND RESPONDENT HOUSE OF HOPS (AUST) PTY LTD ACN 072 644 341 THIRD RESPONDENT |
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JUDGE: |
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DATE: |
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PLACE: |
REASONS FOR JUDGMENT
Introduction [ 2 ]
the issues [ 2 ] - [ 3 ]
the applicant [ 4 ] - [ 28 ]
the first respondent [ 29 ]
the question of translation and pronunciation [ 30 ] - [ 32 ]
the history of beer making in Ceské Budějovice by
the first respondent and its predecessors [ 33 ] - [ 77 ]
the business of the first respondent [ 78 ] - [ 79 ]
the first respondent's promotion
- Czech Republic and Slovakia [ 80 ]
- abroad [ 81 ] - [ 89 ]
the first respondent's stated attitude [ 90 ]
the issues in
more detail [
91 ] -
[ 113 ]
the question of the importation into Australia
of beer labelled 'Budweiser Budvar' [ 114 ] - [ 119 ]
exporting beer labelled 'Budějovický Budvar'
to Australia [ 120 ] - [ 126 ]
The Trade Mark Case [ 127 ] - [ 134 ]
'Budějovický Budvar'
- substantial identity [ 135 ] - [ 140 ]
- deceptive similarity [ 141 ] - [ 182 ]
'Budweiser Budvar' on the front strip [ 183 ]
- trade mark use [ 184 ] - [ 192 ]
- defence under s 122 [ 193 ] - [ 196 ]
- good faith [ 197 ] - [ 219 ]
the effect of 'Budweiser Budvar' on
'Budějovický Budvar' [ 220 ] - [ 228 ]
the question of stationery and catalogues:
the qualification to paragraph 2 of the
undertaking [ 229 ] - [ 232 ]
Passing-off and the Trade Practices Act Claim [ 233 ] - [ 248 ]
The Cross-Claim [ 249 ] - [ 260 ]
Orders [ 261 ]
INTRODUCTION
2 This case primarily concerns the markings on bottles of beer which the first respondent, a Czech brewing company, exported to Australia in 1997 and which it intends to export to Australia. The applicant claims that the first respondent's past and proposed labels infringe its trade marks registered under the Trade Marks Act 1995 (Cth) (the TM Act) in particular 'Budweiser', 'Bud' and 'Budweiser King of Beers', that the past and proposed conduct has amounted, and will, if allowed, amount to a contravention of s 52 and paras 53(c) and (d) of the Trade Practices Act 1974 (Cth) (the TP Act) and that the conduct has amounted, and will amount, if allowed, to passing-off. Orders have previously been made against the second respondent. The third respondent, which was, for a time, the importing agent of the first respondent, is in liquidation. No application was made by the applicant to continue the proceedings against the third respondent. Various undertakings on a final, but 'without admissions', basis have been proffered to the Court by the first respondent. I will deal with these undertakings in due course.
3 The applicant, Anheuser-Busch, Inc. is a company incorporated in the State of Missouri in the United States of America. It is, and at all relevant times has been, registered as the proprietor of various marks under the TM Act and earlier Commonwealth trade mark legislation. There was no issue in the proceedings about the registration, ownership or validity of the trade marks. The five trade marks pleaded as those in respect of which the applicant complains about the conduct of the first respondent are as follows:
|
NUMBER |
MARK |
CLASS |
GOODS |
|
163032 |
BUD |
32 |
Beer, ale and porter and their
ingredients included in this class |
|
163033 |
BUDWEISER |
32 |
Beer, ale and porter and their
ingredients included in this class |
|
366841 |
BUDWEISER KING OF BEERS |
32 |
Beer |
|
549247 |
BUDWEISER |
25 |
All goods in this class |
|
549248 |
BUD |
25 |
All goods in this class |
4 The applicant is the principal subsidiary of Anheuser-Busch Companies, Inc. which is the parent company of the companies in what might be termed the Anheuser-Busch Group. Whilst the proceedings concern rights of, and complaints by, the applicant, the relevant facts to which I will be referring concern other, and in some cases predecessor, Anhueser-Busch companies. For this reason, from time to time, I will use the expression 'Anheuser-Busch' in a generic way to refer to the applicant or corporate interests relevantly connected to the applicant. No particular point was taken by the first respondent about the corporate forms of the applicant and its predecessor and related corporations.
5 Amongst other things, Anheuser-Busch makes and sells beer in the United States of America, licenses the making and selling of beer in various countries and sells beer in various countries around the world. It is the world's largest brewing organisation, and has been since about 1957.
6 Anheuser-Busch sells its beer in Australia and elsewhere under the brand 'Budweiser'. The beer is also labelled with the word 'Bud', and the phrase 'King of Beers' immediately after, or proximate to, the word 'Budweiser'.
7 Anheuser-Busch has been a producer of large quantities of beer since the nineteenth century. From 1876 until 1895, or thereabouts, when it purchased the business of the brewer C. Conrad & Co (including the label 'Budweiser') Anheuser-Busch produced beer under contract for C. Conrad & Co. Since that time, Anheuser-Busch has produced and sold beer branded 'Budweiser' in the United States and elsewhere in the world, on its own account.
8 The applicant's product is reasonably well known in Australia, at least amongst beer drinkers, as an American beer. For instance, Ms Strachan, who had great experience as a market researcher and marketing consultant in Australia, and who was called by the first respondent, agreed that at least among English speaking people in Australia the only meaning of the word 'Budweiser' is the applicant's beer, and that, in the context of beer, the only meaning of the word 'Bud', in Australia, is the applicant's beer. I should add that the agreement given to the those propositions involved agreement to questions expressed using the syllable and word 'Bud' pronounced to rhyme with 'mud', not 'good'.
9 The views of Ms Strachan, which were shared by Dr Beaton, a 'strategic marketing and management consultant', who was called by the applicant, make it necessary to examine the evidence concerning the reputation of the applicant's products in Australia only in order to give content to these views. It is also appropriate to say something of these matters in order to place my views in connection with the TP Act and passing-off counts, and with some aspects of the TM Act case, in context.
10 In 1996, 'Budweiser' was the largest selling brand of beer in the world and 'Bud Light', a low alcohol beer, was the third largest. 'Bud Light' has been manufactured and sold since about 1982. The word 'Bud' has appeared on packaging of Budweiser beer since about 1953.
11 In 1920, Anheuser-Busch's 'Budweiser' beer was shipped to 44 countries on 6 continents. It has been sold worldwide since the Second World War. In the 1990s it was brewed under licence in 11 countries and exported from the United States to another 70 countries, including Australia and New Zealand. 'Budweiser' beer appears to have been first imported into Australia in 1914, although Anheuser-Busch does not appear to have appointed a distributor in Australia until 1965.
12 Anheuser-Busch has undertaken an active expansionary export policy since the 1970s, based on significant advertising expenditure worldwide and the development of 'Budweiser' and 'Bud' as what might be termed, a global brand.
13 The worldwide advertising has been by a variety of means and in various media: the sponsorship of large sporting events, point of sale advertising, merchandising, print media and, in some countries, particularly the United States, the electronic media. It is unnecessary to be precise about advertising in the many different countries in which it has taken place, but it has occurred in the United States, Europe, the Asia-Pacific region and South America. For example, Anheuser-Busch has advertised in well known and internationally distributed magazines such as Sports Illustrated, Rolling Stone and Life.
14 Very large sums of money have been spent by Anheuser-Busch sponsoring large scale sporting events broadcast worldwide on television. Anheuser-Busch has sponsored (by using the word 'Budweiser') various teams and events. It has sponsored the American Football Superbowl. In 1984 and 1988 it sponsored the United States team at the Olympics. In 1988 it was sponsor of the Winter Olympics. In 1992 it sponsored the United States team at the Olympics. In 1992 it sponsored the United States team at the Winter Olympics. In 1994 it sponsored the United States team at the Winter Olympics and was the exclusive malt beverage advertiser at those Olympics. It was an 'official partner' of the Olympics at Atlanta in 1996 and it was a sponsor of the United States team at the 1998 Winter Olympics. Anheuser-Busch has been a major corporate and official sponsor at the soccer World Cup in 1986, 1990, 1994 and 1998. The World Cup was broadcast on television to a great many countries. Anheuser-Busch, as part of its sponsorship of that event, from time to time took highly visible stadium billboard advertising, displaying the word 'Budweiser', which could be seen on these worldwide television broadcasts.
15 Anheuser-Busch has been a significant sponsor of professional boxing in the United States, which is broadcast worldwide, including to Australia. Anheuser-Busch has, since 1983, sponsored 'Indy Car' racing in the United States, which is also broadcast worldwide.
16 There are also various large scale sponsorships by Anheuser-Busch for United States sporting events which are less widely telecast, such as professional basketball and professional baseball. Anheuser-Busch has used point of sale material around the world using the words 'Budweiser' and 'Bud'. It has, for many years, promoted its product by the use of outdoor signs. The Budweiser product has been 'placed' (so-called product placement) in many well known movies, many of which have been released in Australia.
17 Before coming to advertising and promotion in Australia and New Zealand it is appropriate to say that this extensive worldwide advertising must have produced recognition of the brands of 'Budweiser' and 'Bud' in many people in Australia, by reason of the travel of Australians overseas and the viewing by them, in their travels, of the kinds of advertising to which I have referred, as well as by viewing international television broadcasts within Australia.
18 In Australia, Budweiser has been imported by a distributor since 1965 and sold in retail outlets, hotels, bars, clubs and restaurants. It has been sold, at least since 1990, on airlines flying to and from Australia, including Air New Zealand, Singapore Airlines, Japan Airlines and United Airlines.
19 The level of expenditure by Anheuser-Busch on advertising in Australia was contained in a confidential exhibit. However, it would not be a breach of that confidence to say that the levels of direct expenditure in Australia by Anheuser-Busch on advertising and promotion of 'Budweiser' beer have been modest. Such modest amounts of money as have been spent have been directed to advertising in trade and liquor magazines, some speciality magazines such as Ralph and rugby magazines, a promotion on a commercial radio station, some advertising on Channel 9 in 1989 and some advertising on Channel 10 in 1998, point of sale material to liquor outlets, the production and sale of merchandise bearing the marks 'Budweiser', 'Bud' and 'Budweiser King of Beers', the funding of product launches at places of entertainment and the sponsoring of some sporting events and local sporting teams.
20 From about February 1997, there was apparently some change of emphasis or focus from point of sale material to media advertising. The precise extent and degree of that change is not clear from the evidence.
21 Budweiser beer has been sold in Australia over a number of years in slightly differently shaped containers: in what was called a 'flagship' bottle from 1965 to 1994, in a 'stubbie' bottle from 1994 to 1996, in a 'long-neck' bottle from 1997 and in cans from 1965. All these containers have been sold in cardboard packs and individually. They were often sold in shops and bars where imported or foreign beers were stocked. Not all the exhibits representing these different Anheuser-Busch containers had the mark 'Bud' on them. However, most did so, on the neck of the bottle. All carried the mark 'Budweiser'. All carried the phrase 'King of Beers'.
22 The level of sales of Budweiser in Australia over the years is contained in a confidential exhibit. There was evidence that sales in Australia and the Pacific are increasing. However, it is fair to say that sales in Australia have been modest, in a small segment of the Australian beer market for imported beers, which segment is relatively crowded with overseas competitors.
23 Budweiser has also been sold in New Zealand since at least 1980. It has been sold there in about 60% of liquor stores and 40% of 'on-premises retail outlets', which I take to be places where the beer can be drunk on the premises. Once again, the sales figures tendered were in a confidential exhibit, but it can be stated they have been modest.
24 In New Zealand, as in Australia, Anheuser-Busch has spent modest sums in the advertising and promoting of its beer using the marks 'Budweiser', 'Bud' and 'King of Beers'. The methods used to advertise and promote the products in New Zealand have been point of sale material, merchandising, signage, the promotion of social and sporting events and sponsorship.
25 In all this advertising and promotion in Australia and elsewhere the brand image sought to be conveyed with 'Budweiser' and 'Bud' is youthful American culture, described by Dr Beaton (and agreed with by Ms Strachan) as the self-image benefits sought to be promoted to the consumer. Dr Beaton described the elements of this self image of 'Budweiser' as patriotism in America, sporting prowess, youth, America and Americanisms and 'hipness' of being associated with America and Americanisms. Ms Strachan agreed and added one further element: a desire, especially by the young middle class, to associate with 'blue collar' values, rather than 'white collar'.
26 The above is sufficient to give content to the conclusory views of Ms Strachan and Dr Beaton. Whilst the direct sales and advertising of products bearing the marks 'Budweiser' and 'Bud' over the years in Australia have been modest, it is clear that there is a relatively clear recognition by many in Australia that, as Ms Strachan says, 'Budweiser' refers to American beer of Anheuser-Busch and, when used in the context of beer, 'Bud', as a word, evokes the same thing.
27 The applicant tendered examples of its labels from the time of production for C. Conrad to the present. The marks covering the period since shortly before the applicant appointed a distributor in Australia in 1965 were the following (the dates referred to below being part of the relevant exhibit, Exhibit C):










28 By way of example of bottles and cans sold by the applicant in Australia and New Zealand in the 1990s, the following photographs, which show the use of 'Bud' on the neck, represent the applicant's product:




the
first respondent
29 The first respondent is a Czech company, wholly owned by the Czech Republic, which manufactures and sells beer. Its principal European brewery is located in a town in the Czech Republic called Ceské Budějovice (in the Czech language) or Budweis (in the German language). The predecessor to the first respondent was established in 1894 or 1895 as a joint stock company named 'Cesky akciový pivovar v Ceských Budějovicich' (meaning Czech Joint Stock Brewery in Budějovice).
30 It is appropriate at this point to say something about translation. The name of the town, Ceské Budějovice, is not 'translated' into German as Budweis; rather, for many centuries, German speakers have lived in the town and in this part of Europe (Bohemia), and from time to time have ruled this part of Europe. There is a German name for the town: Budweis. From the seventeenth century (under Habsburg rule), with the growth of the vernacular, German was one of the official languages in Southern Bohemia. The town has a Czech name and a German name, though except for the interruption of the Second World War, the official name since 1918 has been Ceské Budějovice. The point was made by Mr Bocek, the 'General Director' (chief executive officer) of the first respondent, when he pointed out in his evidence that Ceské Budějovice is in Bohemia and there is another Budějovice, in Moravia, not called 'Budweis' or 'Moravian Budweis'.
31 The town name, Ceské Budějovice or Budweis, has adjectival or possessive forms in Czech and German, being Budějovický and Budweiser, respectively.
32 The pronunciation of the syllable 'Bud' in all these Czech and German forms is in a manner approaching rhyming with 'good' (represented the phonetic symbol Ş), as opposed to rhyming with 'mud' (represented by the phonetic symbol Λ). Also, the 'w' and the 's' in the German form are pronounced in German as a 'v' and resembling a soft 'z' in English, respectively.
33 It is necessary to set out a little more history to place this dispute in its commercial context.
34 The town Ceské Budějovice or Budweis was established in 1265 as a royal town under the then Bohemian King, Ottokar II, as part of the colonisation and renewal of central European regions, including Bohemia. Settlements such as Ceské Budějovice or Budweis were often (as this one was) established under royal, as opposed to local feudal or ecclesiastical, control; and commercial rights were generally granted to such new urban centres. One of the commercial privileges (and a valuable one) given to Ceské Budějovice or Budweis was a brewing right. Free born citizens of the town were granted the right to brew beer in their houses for their own consumption and business. The town itself was also granted this right. From this time brewing has been carried on in the town and brewing rights continued to be attached to homes in the town and to the town itself, down to the formation of the immediate predecessor of the first respondent in 1894 or 1895. A brewery was established in the town in 1495 and later expanded. Under the Habsburg and Austro-Hungarian Empire, regulation made exporting beer from the town or locality, where it was produced, generally not possible. However the beer from Ceské Budějovice or Budweis gained some notoriety for its style and quality in and from the sixteenth century so as to permit some distribution outside the town as beer from the town - in a sense, 'Budweiser' beer. Thus, the town has a history of making beer going back over seven centuries.
35 This long history of beer-making in the town leads to the question as to the extent to which the use of the adjectival forms Budějovický and Budweiser carry the meaning: 'of or from Budějovice' and 'of or from Budweis'. For the purposes of this case it can, I think, be readily accepted that Czech and German speakers, or perhaps, some Czech and German speakers familiar with the brewing of beer in Ceské Budějovice or Budweis, would ascribe this meaning to these possessive or adjectival forms. However, in Australia, few, if any, English speakers would appreciate this linguistic structure.
36 There is a history in Europe of brands of beer being referable to geographic, especially urban, locations. At least in part, this was because the commercial privilege of beer production was lucrative and often protected by restrictions on who could produce and sell beer in any given town and on the restrictions on export from towns and localities where it was produced. This, together, one assumes, with the difficulties of transport over long distances, led to the practice of beer and foodstuffs being labelled or marked with their geographical or town origins. Examples of such beers still made and sold are Kulmbach Bier (from Kulmbach), Warsteiner Bier (from Warsteiner), Weltenburger Bier (from Weltenburg), Oud Hoegaards Bier (from Hoegaarden in Belgium), Chimay (from Forges-lez-Chimay in Belguim) and Westmalle (from Male in Belgium).
37 In the late eighteenth century another brewery was established in the town known as the Burgher Brewery which was officially called Die Budweiser Bräuberechtigten-Bürgerliches Bräuhaus. This brewery was German owned (that is owned by German speakers of the town); and the brewery established in 1495 was Czech owned (that is by Czech speakers).
38 In 1894 or 1895 the joint stock company, Cesky akciový pivovar v. Ceských Budějovicich, was established. I will refer to this entity until the events of, and after, the Second World War as 'Cesky akciový pivovar' or 'the joint stock company'. In 1894 and 1895, there was still in existence the Burgher Brewery, referred to above, the brewery owned by German speakers, which was also producing beer in the town.
39 At this point it is necessary to understand a little more about events in the United States.
40 It is not clear on the evidence when Cesky akciový pivovar first began to sell beer in the United States. It does appear that prior to 1911 it was not selling beer in the United States under the name or brand 'Budweiser'. However, it does appear that the Burgher Brewery was doing so, or wanted to do so. In November 1909 the Burgher Brewery sought cancellation of the registration of trademark number 64,125 for the word 'Budweiser', registered on 23 July 1907 in the United States Patent Office in the name of Anheuser-Busch Brewing Association. On 4 September 1911 the Burgher Brewery 'conferred judgment' in favour of the 'registrant', Anheuser-Busch Brewing Association. From the evidence before me, in particular the cross-examination of Mr Bocek, I infer that this was part of wider arrangement between the two sides, that is Anheuser-Busch and the Burgher Brewery.
41 Mr Hajn (the archivist of the first respondent) deposed to the fact that Budweiser beer began to be sold abroad and from 1872 on the American market. He produced copies of letters from the nineteenth century in support of this statement. These letters, together with the evidence of Mr Bocek, make it tolerably plain that it was the Burgher Brewery exporting this named beer into America, and probably elsewhere overseas in the nineteenth century.
42 At about the same time, in 1911, Cesky akciový pivovar and Anheuser-Busch had dealings. On 19 August 1911 a document was signed on behalf of Cesky akciový pivovar by the chairman of the board of the company and a director, both being duly authorised. It was in the following terms:
Anheuser-Busch Brewing Association, a joint-stock company with its principal seat in the city of St. Louis, Missouri, United States of America, uses, while selling and distributing its beer products manufactured in the United States of America, for vessels of all kinds, for bottles and other packaging devices for filling its beer products, as well as for labels, caps and other devices for sealing bottles the verbal trademark 'Budweiser', which trademark, as a trademark registered in the name of the joint-stock company Anheuser-Busch Brewing Association, has been entered in the Trademark Register of the Patent Office of the Department of the Interior of the United States of America under ref. no. 64.125.
The undersigned Ceský akciový pivovar in Ceské Budejovice hereby states that Ceský akciový pivovar expressly acknowledges the right of the joint-stock company Anheuser-Busch Brewing Association to use the aforesaid trademark, registered in the name of Anheuser-Busch Brewing Association in the Trademark Register of the Patent Office of the Department of the Interior of the United States of America under ref. no. 64.125, in course of selling and distributing its beer products, as well as in course of marking the same, whether in the territory of the United States of America or in other non-European countries.
Ceský akciový pivovar in Ceské Budejovice therefore recognizes that it is not in the position to hold any objection against the joint-stock company Anheuser-Busch Brewing Association hereafter marking its products, as well as any and all means and aids used for the distribution thereof, with the word 'Budweiser', especially on vessels, stoppers, cases and other packages, and against its using the word 'Budweiser' in launching its products into distribution, whether per se or in combination with any other marks, patterns or additions chosen by it, with the exception of the word 'Original' or any similar designation or depiction that might mislead the public to believe that the beer products of Anheuser-Busch Brewing Association originate from the city of Budejovice in Bohemia.
The foregoing statement of the joint-stock company Ceský akciový pivovar in Ceské Budejovice also applies to the use of the word 'Budweiser' for marking of beer products of the joint-stock company Anheuser-Busch Brewing Association on notices, offers, price lists and public announcements.
Ceský akciový pivovar in Ceské Budějovice hereby expressly states that, by virtue of its statement to the effect that it is not in the position to object against the joint-stock company Anheuser-Busch Brewing Association using the aforesaid trademark registered in the Trademark Register of the Patent Office of the Department of the Interior of the United States of America under ref. no. 64.125, it does not waive its right to mark its own products with the word 'Budweiser' and/or other marks, patterns or additions for identifying the geographical origin of its beer products in selling or causing such products to be sold anywhere, i.e. including, without limitation to, the territory of the Unites States of America or other non-European countries.
IN WITNESS WHEREOF, Ceský akciový pivovar in Ceské Budejovice affixed its notarized signature hereunto.
Ceské Budejovice, on August 19, 1911.
[diacritical element above the
letter 'e' lacking in original]
43 Anheuser-Busch Brewing Associations paid 30,000 crowns for this document. The parties agreed that this sum was not commercially nominal at the time. The signed documentary receipt says 'against issuance of a document given in Ceské Budějovice on 19 September 1911'. Despite the discrepancy in date, the parties agreed that the document and the 30,000 crowns were directly related.
44 The first relevant trade mark of the joint stock company was the word mark 'Ceský budějovický granát' registered in Ceské Budějovice on 16 August 1922. The word 'granát' means garnet.
45 On 27 March 1925 the trade mark 'Ceský budějovický crystal' was registered by the joint stock company in Ceské Budějovice.
46 On 28 April 1930 the trade mark 'BUDVAR' was registered in the name of the joint stock company locally in Czechoslovakia and on 1 March 1932 in the international register in Berne at the Office of International Industrial Property. Mr Hajn explained that the word 'Budvar' was a word coined from parts of the words 'Budějovický' and 'Pivovar': that is, a coined word from the phrase Budějovický Brewery.
47 In 1931 the joint stock company was registered in the Commercial Register of Ceské Budějovice as 'Budvar, Ceský akciový pivovar'.
48 On 13 February 1934 the joint stock company registered in Ceské Budějovice a trademark for use in the English language containing the word 'Budweiser'. This mark was for the neck and body of a bottle as follows:


49 On 14 May 1936, by resolution of the general meeting, the joint stock company changed its name from 'Ceský akciový pivovar v. C.Budějovicich' to 'Budvar, Ceský akciovy pivovar v. C. Budějovice'. The resolution also dealt with the company's name in different languages. After the general meeting of the company on 14 May 1936, section 1 of the Articles of the company was in the following terms:
The firm name, which originally in Czech read as 'Ceský akciový pivovar v Ceských Budějovicich' was changed by a resolution of the General Meeting held on May 14, 1936, and reads in Czech as follows now: 'Budvar, Ceský ackciový pivovar, Ceské Budějovice', in German: 'Budbräu, Böhmisches Aktienbräuhaus, Budweis', in Slovak: 'Budvar, Ceský úcastinársky pivovar, Ceské Budějovice', in French: 'Budvar, Brasserie tchčque par actions ŕ Ceské Budějovice', in English: 'Budvar, Czech Joint-Stock-Brewery, Ceské Budějovice', in Serbo-Croation: 'Budvar Ceška dionicka pivara, Ceské Budějovice', in Bulgarian: 'Budvar, Cechska akcionerna pivovarna fabrika, Ceské Budějovice' in Hungarian: 'Budvar, Cseh Részvény-Sörfözde, Ceské Budějovice'.
50 The word 'Budvar' appears to have been placed in the name of the company because beers so marked were very popular. Indeed Mr Hajn said that the company name in fact changed to include 'Budvar' two years before the official change in 1936.
51 After prohibition ended in December 1933, the joint stock company commenced exporting to the United States. There was a debate before me as to whether this was a recommencement or a commencement. I will return to this in due course. It is sufficient here to note that Mr Hajn, who was not cross examined, said (in para 29 of his affidavit of 23 June 1999) that after prohibition in the USA 'had ended' the joint stock company 'started again exporting into this area'. In 1936 the joint stock company filed for registration of a trade mark in America. The mark was registered in 1937. It was as follows: