American Airlines, Inc v AdvantageCard Pty Ltd

[2012] ATMO 6

TRADE MARKS ACT 1995

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS

Re:Oppositions by American Airlines, Inc to registration of trade mark applications 1218014, 1218016 & 1218017(35) - ADVANTAGECARD, ADVANTAGECARD REWARDS FOR HOMEMAKERS & ADVANTAGECARD REWARDS FOR THE BUILDING INDUSTRY  - filed in the name of AdvantageCard Pty Ltd.

Delegate:

Jock McDonagh

Representation:

Opponent: Eric Ziehlke of Chrysiliou IP

Applicant: Luke Merrick of counsel instructed by Actuate IP

Decision:

2012 ATMO 6

Section 52 oppositions – ss42, 44 and 60 pressed. Grounds under ss42, 44 and 60 not established – trade mark to proceed to registration– costs awarded against opponent

Background

1. These are oppositions brought by American Airlines, Inc (“the Opponent”) pursuant to s 52 of the TradeMarks Act 1995 (“the Act”) to registration of three applications filed in the name of AdvantageCard Pty Ltd (“the Applicant”) for the following trade marks:

Regn No.	Priority Date	Trade Mark	Class & Specification
1218014	07.01.08	Class: 35 Loyalty, rewards and discount schemes and programs; business organization and management of discount services; business services relating to the supply of benefits in connection with loyalty and incentive programs and schemes; advertising and promotional services; provision of information, advisory and consultancy services in relation to the aforementioned services
Regn No.	Priority Date	Trade Mark	Class & Specification
1218016	07.01.08	Class: 35 (as above)
1218017	07.01.08	Class: 35 (as above)

1. I will refer hereafter to the services covered by the three opposed applications collectively as “the Services” and to the opposed trade marks as “the Trade Marks”.

2. Following examination and acceptance of the applications the Opponent filed Notices of Opposition to the registration of the Trade Marks (hereafter referred to collectively as “the Notices”) on 29 January 2009.

3. The parties filed and served Evidence in Support, Evidence in Answer and Evidence in Reply as follows:

Evidence in Support

• Statutory Declaration by Bridget Blaise-Shamai made 20 October 2009, with Annexures XX-1 to XX-11 (“Blaise-Shamai”)

  • Statutory Declaration by Charles Sultan made 12 March 2010, with annexures XY-1 to XY-5 (“Sultan 1”)

Evidence in Answer

• Statutory Declaration by Mark Trueman made 20 September 2010, with Exhibits MT-1 to MT-7 (“Trueman 1”)
• Statutory Declaration by Mark Trueman made 21 September 2010, with Exhibits MT-1 to MT-5 (“Trueman 2”)
• Statutory Declaration by Mark Trueman made 21 September 2010, with Exhibits MT-1 to MT-5 (“Trueman 3”)

Evidence in Reply

• Statutory Declaration by Eric James Ziehlke made 8 March 2011, with annexure EJZ-1 (“Ziehlke”)
• Statutory Declaration by Stephen Limbrick made 21 March 2011, with annexure SL-1 (“Limbrick”)
• Statutory Declaration by Charles Sultan made 19 April 2011, with annexures YY-1 to YY-7 (“Sultan 2”)

1. I heard the matter as delegate of the Registrar of Trade Marks on 24 October 2011 in Canberra.  Eric Ziehlke of Chrysiliou IP, Patent & Trade Mark Attorneys, appeared for the Opponent. Luke Merrick of counsel, instructed by Actuate IP, Patent & Trade Mark Attorneys, appeared for the Applicant.

Grounds of Opposition

1. The Notices nominated most of the grounds of opposition available under the Act. The onus is upon the opponent to establish one or more of its grounds of opposition on the balance of probabilities.[1]

   [1] Following Gyles J in Pfizer Products Inc v Karam (2006) 70 IPR 599 at [6] to [26]. See also Chocolaterie Guylian N.V. v Registrar of Trade Marks (2009) 82 IPR 13 per Sundberg J at [22] to [27], Sports Warehouse, Inc v Fry Consulting Pty Ltd (2010) 87 IPR 300 per Kenny J at [30] to [40] and NV Sumatra Tobacco Trading Company v British American Tobacco Services Limited [2011] FCA 1051 (9 September 2011) per Greenwood J at [16] to [32].

2. At the hearing the opponent advised that it pressed only those grounds under sections 42, 44 and 60 of the Act. None of the evidence served and filed by the opponent appears to go to the other grounds in the Notices and for the sake of completeness I find that they have not been established.

3. Therefore, the grounds remaining for my consideration are those under sections 42, 44 and 60 of the Act. Should the opponent establish any one ground of opposition, there is no requirement for me to consider any of the other grounds of opposition.

Discussion

Section 44 – Identical etc. trade marks

1. Section 44 of the Act relevantly states:

   44.(2) Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant's trade mark) in respect of services (applicant's services) must be rejected if:

   (a) it is substantially identical with, or deceptively similar to:

   (i) a trade mark registered by another person in respect of similar services or closely related goods; or
   (ii) a trade mark whose registration in respect of similar services or closely related goods is being sought by another person; and

   (b) the priority date for the registration of the applicant's trade mark in respect of the applicant's services is not earlier than the priority date for the registration of the other trade mark in respect of the similar services or closely related goods.

   Note 1: For deceptively similar see section 10.

   Note 2:  For similar services see subsection 14(2).
   Note 3:  For priority date see section 12.

2. The opponent cited its portfolio of prior registered Australian trade marks, the details of which are follows

Regn No.	Priority Date	Trade Mark	Class & Specification
519305	15.09.89	Class: 39 Services rendered in the carriage or transport of passengers and freight by aeroplane and related or ancillary means of transport; and all other services necessarily connected with or ancillary to such transport including freight forwarding and storage, arranging of tours and travel information
702930	20.02.96	AADVANTAGE GOLD	Class: 39 Transportation of passengers by air, including providing a program of bonus flights for frequent travellers
702934	20.02.96	AADVANTAGE PLATINUM	Class: 39 Transportation of passengers by air, including providing a program of bonus flights for frequent travellers
721814	14.11.96	Class: 39 Services in relation to the transportation of passengers by air, inclusive of providing a program of bonus flights for frequent travellers
753045	19.01.98	AADVANTAGE EXECUTIVE PLATINUM	Class: 39 Transportation services, namely providing a program of bonus flights for frequent travellers
805290	27.08.99	AADVANTAGE	Class: 35 Promoting the goods and services of other by means of an incentive awards program, whereby purchase points are awarded for purchase made from vendor subscribers, which can then be rendered for merchandise and travel Class: 39 Providing air transportation services featuring a program of bonus flights for frequent travellers
826664	07.03.00	Class: 35 Promoting the goods and services of others by means of an incentive awards program, whereby purchase points are awarded for purchases made from vendor subscribers, which can then be redeemed for merchandise and travel Class: 39 Transportation of passengers and cargo; travel information and reservation services

1. Mr Ziehlke for the opponent submitted that, although it relied on all of the above prior registered trade marks, for the purposes of comparison, registration 805290 AADVANTAGE would be used as the best example, on the basis that if it not (at a minimum) deceptively similar to the Trade Marks, it follows that neither are the other prior registered marks. Mr Ziehlke conceded that none of the Opponent’s cited trade marks were substantially identical to the Trade Marks.

2. The term deceptively similar is defined in section 10 of the Act as follows:

   10. For the purposes of this Act, a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.

3. Deceptive similarity is to be assessed according to the tests set out in Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at paragraph 13 per Windeyer J:

   On the question of deceptive similarity a different comparison must be made from that which is necessary when substantial identity is in question. The marks are not now to be looked at side by side. The issue is not abstract similarity, but deceptive similarity. Therefore the comparison is the familiar one of trade mark law. It is between, on the one hand, the impression based on recollection of the plaintiff's mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant's television exhibitions. To quote Lord Radcliffe again: "The likelihood of confusion or deception in such cases is not disproved by placing the two  marks  side by side and demonstrating how small is the chance of error in any customer who places his order for goods with both the  marks  clearly before him . . . . It is more useful to observe that in most persons the eye is not an accurate recorder of visual detail, and that marks are remembered rather by general impressions or by some significant detail than by any photographic recollection of the whole": de Cordova v. Vick Chemical Co (1951) 68 RPC, at p 106. And in Australian Woollen Mills Ltd v. F.S. Walton & Co. Ltd. (1937) 58 CLR 641 Dixon and McTiernan JJ. said: "In deciding this question, the marks ought not, of course, to be compared side by side. An attempt should be made to estimate the effect or impression produced on the mind of potential customers by the mark or device for which the protection of an injunction is sought. The impression or recollection which is carried away and retained is necessarily the basis of any mistaken belief that the challenged mark or device is the same" (1937) 58 CLR, at p 658.

4. I am to estimate the effect of the trade marks on the minds of potential customers – in other words, the assessment is to take place in the context of the marketplace for the goods.  This contextual comparison was stressed in Re Application by the Pianotist Co Ltd (1906) 1A IPR 379 at 380, where Parker J said: 

   You must take the two words. You must judge of them, both by their look and by their sound. You must consider the goods to which they are to be applied. You must consider the nature and kind of customer who would be likely to buy those goods. In fact, you must consider all the surrounding circumstances; and you must further consider what is likely to happen if each of those trade marks is used in a normal way as a trade mark for the goods of the respective owners of the marks.

5. The standard which is applied to the assessment of whether the trade marks are deceptively similar was stated by French J in Registrar of Trade Marks v Woolworths [1999] FCA 1020; (1999) 45 IPR 411 at paragraph 50:

   In Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 at 594-5, which concerned the 1905 Act, Kitto J set out a number of propositions which have frequently been quoted and applied to the 1955 Act. The essential elements of those propositions continue to apply to the issue of deceptive similarity under the 1995 Act. Applied also to service marks and absent the imposition of an onus upon the applicant they may be restated as follows:

   (i) To show that a trade mark is deceptively similar to another it is necessary to show a real tangible danger of deception or confusion occurring. A mere possibility is not sufficient.

   (ii) A trade mark is likely to cause confusion if the result of its use will be that a number of persons are caused to wonder whether it might not be the case that the two products or closely related products and services come from the same source. It is enough if the ordinary person entertains a reasonable doubt.

   It may be interpolated that this is another way of expressing the proposition that the trade mark is likely to cause confusion if there is a real likelihood that some people will wonder or be left in doubt about whether the two sets of products or the products and services in question come from the same source.

   (iii) In considering whether there is a likelihood of deception or confusion all surrounding circumstances have to be taken into consideration. These include the circumstances in which the marks will be used, the circumstances in which the goods or services will be bought and sold and the character of the probable acquirers of the goods and services.

   (iv) The rights of the parties are to be determined as at the date of the application.

   (v) The question of deceptive similarity must be considered in respect of all goods or services coming within the specification in the application and in respect of which registration is desired, not only in respect of those goods or services on which it is proposed to immediately use the mark. The question is not limited to whether a particular use will give rise to deception or confusion. It must be based upon what the applicant can do if registration is obtained.

   In respect of the last proposition, Mason J observed in Berlei Hestia Industries Ltd v The Bali Company Inc [1973] HCA 43; (1973) 129 CLR 353 at 362:

   “...the question whether there is a likelihood of confusion is to be answered, not by reference to the manner in which the respondent has used its mark in the past, but by reference to the use to which it can properly put the mark. The issue is whether that use would give rise to a real danger of confusion."

6. I have taken into consideration the relative expense of the services offered under the respective trade marks.  Consumers selecting international travel options are likely to take care in making bookings. Indeed, there is a likelihood that a portion of the services would be sold by travel agents who would be likely aware of the trade marks of a wide group of traders and would thus be used to discriminating between them.

7. Counsel for the Applicant also reminded me that where an element of a trade mark is “common to the trade”, its presence must (at least to some extent) be discounted in considering whether the trade marks containing that element are deceptively similar. He referred to Conde Nast Publications Pty Ltd v Taylor (1998) 41 IPR 505, where Burchett J stated (at 511-512):

   At the same time, it should be borne I mind that “vogue” is neither a made-up word nor a word wholly without any direct application, in the ordinary use of the language, to the goods in question. A trader is not entitled to monopolize such a word, denying its use entirely to other traders. Deceptive or confusing use is barred by the applicant’s registration, but the Court should be careful not to shut out inappropriately other traders from the fair use of the language in ways that will not in reality deceive or confuse.

8. The Trade Marks share common features that I consider to be relevant for the purposes of comparison in accordance with the cited authorities. They each include a square and underline graphic element, they each include ADVANTAGEcard rendered as one word with the first element in capitals and the second in lower case.

9. The Opponent’s cited trade marks each share the ‘AA-’ prefix. Although comparison for the purposes of this ground is centered on registration 805290, I do note in passing that the Opponent’s trade marks 519305, 721814 and 826664 incorporate an eagle device between the initial As, which seem to be a reference to American Airlines.

10. The common feature of the Trade Marks and the Opponent’s cited trade marks is the word ‘advantage’. The word ‘advantage’ is an everyday English word. The Opponent’s evidence in Exhibit EJZ-1 (relating to the trade mark examiner’s search results for the Applicant’s trade mark application 1339212 ADVANTAGEcard) to Ziehle details some 11 trade marks that incorporate the word ‘advantage’ and are registered or sought to be registered in relation to loyalty or reward programs.

11. The word ‘advantage’ does seem to be a word ‘common to the trade’, and is a word suggestive of the services provided. Additionally, the emphasis to the ‘AD-’ prefix caused by the graphic ‘frame’ device combined with the ‘-card’ suffix of the Trade Marks, in comparison with the idiosyncratic double-A prefix of the Opponent’s trade marks would likely cause differing recollections of the respective marks in the minds of consumers.

12. I am not satisfied that there is a real likelihood that some people will wonder or be left in doubt about whether the two sets of services in question come from the same source. The ground of opposition under section 44 has not been established.

Section 60: Trade mark similar to trade mark that has acquired a reputation in Australia

1. Section 60 of the Act provides:

   The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:

   (a)another trade mark had, before the priority date for the registration of the first‑mentioned trade mark in respect of those goods or services, acquired a reputation in Australia; and

   (b)because of the reputation of that other trade mark, the use of the first‑mentioned trade mark would be likely to deceive or cause confusion.

   Note:For priority date see section 12.

2. It is not necessary to show under section 60 that the respective trade marks are deceptively similar although such a finding can be relevant in determining the likelihood of deception or confusion. Such a finding has not been found in this matter; however, that is not necessarily fatal to the section 60 ground.

3. Reputation is to be assessed according to the test set out in McCormick & Company Inc v McCormick (2000) 51 IPR 102 by Kenny J at paragraph 81:

   What is intended by the word “reputation” in s 60? The word is defined in The Macquarie Dictionary as follows:

   reputation ... 1. the estimation in which a person or thing is held, esp. by the community or the public generally; repute ... 2. favourable repute; good name ... 3. A favourable and publicly recognised name or standing for merit, achievement, etc. ... 4. The estimation or name of being, having done, etc, something specified.

   Cf. The Oxford English Dictionary. In s 60, the word is, I think, apt to refer to “the recognition of the McCormick & Co marks by the public generally”.

   Does the evidence establish that in Australia before 9 March 1992 the McCormick & Co marks were recognised by the public generally and, because of that, the use by Mary McCormick of her marks would be likely to cause the public confusion, as for example, by the public’s mistakenly attributing a business connection between the two or attributing her product to the company?

4. Further, at 127, Kenny J said:

   In practice, it is commonplace to infer reputation from a high volume of sales, together with substantial advertising expenditures and other promotions, without any direct evidence of consumer appreciation of the mark, as opposed to the product.

5. The Opponent’s evidence establishes that the opponent is an airline originally established in the USA in 1934 and has grown to being one of the world’s largest airlines, which operates primarily in the USA but also internationally. The Opponent does not operate out of Australia, although it did so for a two year period between 1990 and 1992. The Opponent does operate on a “code share” basis with Qantas, such that a Qantas passenger flying to USA destinations not serviced by Qantas will be booked on a flight operated by or affiliated to the Opponent. Miles flown on either carrier can count towards each other’s frequent flyer programs.

6. The evidence also establishes that the Opponent’s frequent flyer program is known as AADVANTAGE. It was established in 1981 and had approximately 5 million members worldwide, including approximately 85,000 in Australia. The program had worldwide revenues between 1998 and 2008 of some US$12 billion.

1. The Opponent does not offer flights directly to or from Australia. While it is the case that the Opponent’s services booked in Australia would be considered use of the trade marks in Australia[2], it is not clear from the evidence what the extent of this usage was.

   [2] Carnival Cruise Lines Inc v Sitmar Cruises Ltd (1995) 31 IPR 375, at 388

2. The Opponent has no physical presence in Australia, although the Opponent has brought my attention to the Opponent’s USA web-site that, according to Sultan 2 attracted an average of 25,000 “hits” per month from Australia over the past two years. Apparently, the AADVANTAGE program is strongly featured on the web-site. However, these hits are after the priority date of the Trade Marks.

3. The publications exhibited in Blaise-Shamai do not seem to be available in Australia and, in many cases, are very old and date back to 1989. I afford them very little weight in establishing a reputation in Australia as at 7 January 2008.  

4. There is no evidence about the “worldwide revenue” generated by the Opponent’s AADVANTAGE program that is referable to Australia.

5. The mentions of AADVANTAGE on the Qantas web-site, exhibited as XY-3 in Sultan appears from the tone and style of the text to be directed to USA customers of the Opponent, rather than to Australian customers.

6. I am not satisfied that the evidence provided by the Opponent demonstrates a requisite level of reputation within Australia such that (if the trade marks were similar) deception or confusion would become a likelihood amongst ordinary Australians.

7. The ground of opposition under section 60 of the Act has not been established.

Section 42 – Trade mark scandalous or contrary to law

1. Section 42 of the Act relevantly provides:

   42. An application for the registration of a trade mark must be rejected if:

   (a) …
   (b) its use would be contrary to law.

2. The Opponent submitted that use of the Trade Marks would constitute misleading and deceptive conduct in contravention of section 52 of the Trade Practices Act 1974 (“TPA”) (now section 18 of the Australian Consumer Law (“ACL”), consisting of Schedule 2 to the Competition and Consumer Act 2010, false representations as to sponsorship, approval or affiliation in contravention of section 53(a) of the TPA (now section 29(1)(a) of the ACL), and passing off.

3. The opponent based the section 52 of the TPA allegation on the deceptive similarity that I have found not to apply here. The remaining conduct was based on the concurrent use of the Trade Marks and the views expressed in declarations by the opponent’s legal representatives and employees. There was no evidence put on of any actual instances of members of the public being mislead or deceived.

4. For this ground to be established, I must be satisfied that use of the Trade Marks would be contrary to law: Advantage Rent-a-Car Inc v Advantage Car Rental Pty Ltd [2001] 52 IPR 24. There is insufficient evidence to so satisfy me.

5. The ground of opposition under section 42 of the Act has not been established.

Decision

1. Section 55 (1) of the Act provides:

   (1) Unless the proceedings are discontinued or dismissed, the Registrar must, at the end, decide:

   (a) to refuse to register the trade mark; or

   (b) to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;

   having regard to the extent (if any) to which any ground on which the application was opposed has been established.

   Note:  For limitations see section 6.

2. The Opponent has not established a ground of opposition under the Act. I direct that trade mark applications 1218014, 1218016 and 1218017 may proceed to registration after one month from the date of this decision.

3. If the Registrar is served with a notice of appeal on or before that time, I direct that registration shall not occur until the appeal has been discontinued, or in the event of a decision from the court, that the application be subject to that order. 

Costs

1. Both parties sought costs on the basis that costs should follow the event. The Applicant has been successful and I find that it is entitled to an award of costs. I award costs against the Opponent in accordance with Schedule 8 of the Trade Mark Regulations 1995, with costs for the second and third of the oppositions to be assessed as set out in the table attached to the Hearing Officer’s decision in James Hardie & Co Pty Ltd v Hume Industries (Malaysia) Berhad (2001) 53 IPR 591.

Jock McDonagh

Hearings Officer

Trade Marks Hearings

23 January 2012