Bed Bath ‘N' Table Pty Ltd v Global Retail Brands Australia Pty Ltd
[2023] FCA 1587
•14 December 2023
FEDERAL COURT OF AUSTRALIA
Bed Bath ‘N’ Table Pty Ltd v Global Retail Brands Australia Pty Ltd [2023] FCA 1587
File number: VID 314 of 2021 Judgment of: ROFE J Date of judgment: 14 December 2023 Catchwords: TRADE MARKS — infringement — whether the respondent’s use of the “House BED & BATH” mark infringed the applicant’s registered trade marks comprising the words “BED BATH N’ TABLE” — whether the applicant has an independent reputation in the words “BED BATH” — whether the words “bed” and “bath” are purely descriptive — relevance of alleged confusion evidence — infringement not established.
TRADE MARKS — infringement — defences to infringement — whether the respondent can establish the defence under s 122(1)(b)(i) of the Trade Marks Act 1995 (Cth) — in the event of infringement being established, the respondent has not made out the defence.
TRADE PRACTICES — misleading or deceptive conduct — alleged breaches of s 18 and s 29(1)(a), (g) and (h) of the Australian Consumer Law — well-established reputation of the applicant — wilful blindness of the respondent as to whether store name likely to mislead or deceive consumers — elements of claims established — passing off — reputation — elements of claims established.
Legislation: Competition and Consumer Act 2010 (Cth)
Evidence Act 1995 (Cth)
Trade Marks Act 1995 (Cth)
Trade Practices Act 1974 (Cth)
Fair Trading Act 1986 (NZ)
Cases cited: A Nelson & Co Ltd v Martin & PleasancePty Ltd (2021) 157 IPR 376
Adidas AG v Pacific Brands Footwear Pty Ltd (No 3) (2013) 103 IPR 521
Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd (2021) 162 IPR 52
Anheuser-Busch Inc v Budejovicky Budvar (2002) 56 IPR 182
Apple Inc v Registrar of Trade Marks (2014) 109 IPR 187
Australian Meat Group Pty Ltd v JBS Australia Pty Ltd (2018) 137 IPR 385
Australian Postal Corp v Digital Post Australia Pty Ltd (2013) 105 IPR 1
Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641
Bohemia Crystal Pty Ltd v Host Corp Pty Ltd (2018) 129 IPR 482
Brands Ltd v Bed Bath ‘N’ Table Pty Ltd (2023) 174 IPR 261
Brick Lane Brewing Co Pty Ltd v Torquay Beverage Co Pty Ltd (2023) 170 IPR 195
CA Henscke & Co v Rosemount Estates Pty Ltd (2000) 52 IPR 42
Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd (2007) 72 IPR 261
Campaign Master (UK) Ltd v Forty Two International Pty Ltd (No 3) (2009) 181 FCR 152
Cantarella Bros Pty Ltd v Lavazza Australia Pty Ltd (No 3) [2023] FCA 1258
Cat Media Pty Ltd v Opti-Healthcare Pty Ltd [2003] FCA 133
Caterpillar Inc v Puma SE (2021) 162 IPR 430
Champagne Heidsieck et Cie Monopole Societe Anonyme v Buxton [1930] 1 Ch 330
Chocolaterie Guylian NV v Registrar of Trade Marks (2009) 82 IPR 13
ConAgra Inc v McCain Foods (Aust) Pty Ltd (1992) 23 IPR 193
Conde Nast Publications Pty Ltd v Taylor (1998) 41 IPR 505
Domain Names Australia Pty Ltd v .au Domain Administration Ltd (2004) 63 IPR 1
E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144
Energy Beverages LLC v Cantarella Bros Pty Ltd (2023) 170 IPR 281
Fine & Country Ltd v Okotoks Ltd [2012] EWHC 2230
Flexopack SA Plastics Industry v Flexopack Australia Pty Ltd (2016) 118 IPR 239
Gain Capital UK Ltd v Citigroup Inc (No 4) (2017) 123 IPR 234
State Street Global Advisors Trust Co v Maurice Blackburn Pty Ltd(No 2) (2021) 164 IPR 420
Global Brand Marketing Inc v YD Pty Ltd (2008) 76 IPR 161
Halal Certification Authority Pty Ltd v Flujo Sanguineo Holdings Pty Ltd (2021) 163 IPR 433
Halal Certification Authority Pty Ltd v Flujo Sanguineo Holdings Pty Ltd [2023] FCAFC 175
Hashtag BurgerPty Ltd v In-N-Out Burgers, Inc (2020) 159 IPR 186
Health World Ltd v Shin-Sun Australia Pty Ltd (2005) 64 IPR 495
Homart Pharmaceuticals Pty Ltd v Careline Australia Pty Ltd (2017) 126 IPR 498
Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216
Hy-Line Chicks Pty Ltdv Swifte (1996) 115 CLR 159
In-N-Out Burgers, Inc v Hashtag Burgers Pty Ltd (2020) 150 IPR 73
Knight v Beyond Properties Pty Ltd (2007) 74 IPR 232
Lift Shop Pty Ltd v Easy Living Home Elevators Pty Ltd (2014) 106 IPR 419
London Lubricants (1920) Limited’s Application (1924) 42 RPC 264
Mid SydneyPty Ltd v Australian Tourism Co Ltd (1998) 42 IPR 561
Mitolo Wines Aust Pty Ltd v Vito Mitolo and Son Pty Ltd (2019) 142 IPR 182
Nature’s Blend Pty Ltd v Nestlé Australia Ltd (2010) 87 IPR 464
Optical 88 Ltd v Optical 88 Pty Ltd (No 2) (2010) 89 IPR 457
PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd (2020) 154 IPR 68
PDP CapitalPty Ltd v Grasshopper Ventures Pty Ltd (2021) 160 IPR 174
Pham GlobalPty Ltd v Insight Clinical Imaging Pty Ltd (2017) 141 IPR 1
Phone Directories Co Australia Pty Ltd v Telstra Corp Ltd (2014) 106 IPR 291
Samsung Electronics Australia Pty Ltd v LG Electronics Australia Pty Ltd (2015) 113 IPR 11
SAP AustraliaPty Ltd v Sapient Australia Pty Ltd (1999) 48 IPR 593
Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd (2023) 408 ALR 195
Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407
Singtel Optus Pty Ltd v Optum Inc (2018) 140 IPR 1
SMA Solar Technology AG v Beyond Building Systems Pty Ltd (No 5) [2012] FCA 1483
Solahart Industries Pty Ltd v Solar Shop Pty Ltd (2011) 92 IPR 165
Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592
Sports Warehouse Inc v Fry Consulting Pty Ltd (2010) 87 IPR 300
State Government Insurance Corp v Government Insurance Office of New South Wales (1991) 28 FCR 511
Stone and Wood Group Pty Ltd v Intellectual Property Development Corp Pty Ltd (2018) 129 IPR 238
Swancom Pty Ltd v Jazz Corner Hotel Pty Ltd (No 2) (2021) 157 IPR 498
Swancom Pty Ltd v The Jazz Corner Hotel Pty Ltd (2022) 168 IPR 42
Sydneywide DistributorsPty Ltd v Red Bull Australia Pty Ltd (2002) 55 IPR 354
Telstra Corp Ltd v Phone Directories Co Pty Ltd (2014) 107 IPR 333
Toddler Kindy Gymbaroo Pty Ltd v Gymboree Pty Ltd (2000) 51 IPR 1
Verrocchi v Direct Chemist Outlet Pty Ltd (2015) 112 IPR 200
Vivo International Corp Pty Ltd v Tivo Inc (2012) 99 IPR 1
WingateMarketing Pty Ltd v Levi Strauss & Co (1994) 28 IPR 193
Division: General Division Registry: Victoria National Practice Area: Intellectual Property Sub-area: Trade Marks Number of paragraphs: 538 Date of last submission/s: 25 August 2023 Date of hearing: 29 — 30 November 2022, 5 — 15 December 2022, 29 March 2023 Counsel for the Applicant: Colin Golvan AM KC with Ian Horak SC and Lucy Davis Solicitor for the Applicant: Phillips Ormonde Fitzpatrick Lawyers Counsel for the Respondent: Bruce Caine KC with Peter Creighton-Selvay and Rebecca De Stoop Solicitor for the Respondent: DLA Piper ORDERS
VID 314 of 2021 BETWEEN: BED BATH ‘N’ TABLE PTY LTD
Applicant
AND: GLOBAL RETAIL BRANDS AUSTRALIA PTY LTD
Respondent
ORDER MADE BY:
ROFE J
DATE OF ORDER:
14 DECEMBER 2023
THE COURT ORDERS THAT:
1.If the parties agree on the appropriate orders to be made by the Court reflecting these reasons for judgment, including as to relief and costs, the parties file a minute of proposed orders by 4.00 pm on 9 February 2024.
2.If the parties are unable to agree on the orders which should be made, each of the parties file and serve by 4.00 pm on 9 February 2024:
(a)A minute of the orders that the party proposes; and
(b)Any outline of submissions in support of the proposed orders (not exceeding five pages in length).
3.In the event the parties are unable to agree on the orders which should be made, the matter be listed for hearing at 10.15 am on 15 February 2024.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
ROFE J:
1 INTRODUCTION
[1]
2 WITNESSES
[15]
2.1 Lay witnesses
[15]
2.2 Expert witnesses
[21]
3 CORE FACTS
[24]
3.1 Soft homewares
[24]
3.2 Bed Bath N’ Table
[26]
3.2.1 BBNT stores
[36]
3.2.2 BBNT online and social media presence
[43]
3.2.3 BBNT brand extensions
[48]
3.3 GRBA
[52]
3.3.1 House
[56]
3.3.2 GRBA’s earlier attempt to enter the soft homewares market
[64]
3.4 Reputation
[69]
3.5 Other retailers in the soft homewares market
[73]
3.6 Cross-promotion
[76]
3.7 Co-location of soft homewares stores
[78]
3.8 Consumers
[82]
3.9 Sub-branding
[88]
3.10 Use of “bed” and “bath” as category or navigational descriptors
[92]
3.11 Google Analytics data
[99]
3.12 Tendency to shorten
[111]
3.13 Instances of use of the House B&B mark
[125]
4 ADOPTION OF THE HOUSE B&B NAME
[128]
4.1 Mr Lew’s evidence
[169]
4.2 Ms McGann’s evidence
[189]
4.3 Mr Caruana’s evidence
[219]
4.4 Ms Cameron’s evidence
[226]
4.5 Mr Kupshik’s evidence
[232]
4.6 Conclusion
[234]
5 EXPERT EVIDENCE
[243]
5.1 Use of “bed” and “bath”
[243]
5.2 Brand extensions
[253]
6 ALLEGED CONFUSION EVIDENCE
[259]
6.1 Example instances of alleged confusion
[286]
6.1.1 BBNT witnesses
[286]
6.1.1.1 Ms D’Alessio
[290]
6.1.1.2 Ms Erdossy
[292]
6.1.1.3 Ms Dimopoulos
[297]
6.1.1.4 Ms Harry
[299]
6.1.1.5 Ms Downes
[300]
6.1.1.6 Ms Chatfield
[302]
6.1.1.7 Ms Timms
[307]
6.1.1.8 Ms van der Plight
[309]
6.1.1.9 Mr Tabe
[313]
6.1.1.10 Ms Vigors
[316]
6.1.2 GRBA witnesses
[317]
6.1.2.1 Ms Turner
[317]
6.1.3 GRBA discovery
[319]
6.1.4 Shopping centres
[321]
6.1.5 GRBA internal confusion
[323]
6.1.5.1 Rockingham BB
[324]
6.1.5.2 Doncaster — Bed Bath and Table
[329]
6.2 Admissibility and weight of the confusion evidence
[333]
7 TRADE MARK INFRINGEMENT
[341]
7.1 Relevant sections of the Trade Marks Act
[342]
7.2 Principles
[345]
7.2.1 Use as a trade mark
[347]
7.2.2 Substantial identity
[353]
7.2.3 Deceptive similarity
[365]
7.3 The parties’ submissions
[374]
7.4 Consideration
[389]
7.4.1 Use as a trade mark
[389]
7.4.2 Use of “BED & BATH” not solely descriptive
[399]
7.4.3 Overlap of goods and services
[406]
7.4.4 Substantial identity
[409]
7.4.5 Deceptive similarity
[415]
7.4.5.1 BBNT v House B&B
[432]
7.4.5.2 BBNT v BED & BATH
[443]
7.5 Defence to infringement
[451]
7.5.1 Principles
[454]
7.5.2 Consideration
[463]
8 AUSTRALIAN CONSUMER LAW
[482]
8.1 Relevant Provisions
[484]
8.2 Principles
[486]
8.3 Relevant class of consumer
[493]
8.4 The parties’ submissions
[496]
8.5 Consideration
[504]
8.5.1 The conduct
[504]
8.5.2 Trade and commerce
[506]
8.5.3 Whether conduct misleading or deceptive or likely to mislead or deceive
[507]
9 PASSING OFF
[523]
9.1 Principles
[525]
9.2 Consideration
[530]
10 NEW ZEALAND CASE
[534]
11 CONCLUSION
[535]
12 FINAL NOTE
[538]
1. INTRODUCTION
For over three decades, the parties, both substantial retailers, each with descriptive words in their names, have managed to co-exist in distinct spaces in the broader homewares sector. Over time, each has built up a substantial reputation in its brand, until one day one decides to open a sub-brand in the domain of the other, using a name that incorporates words from the brand of the other.
Since 1976, Bed Bath N’ Table Pty Ltd (BBNT) has conducted a business operating a network of stores selling soft homewares under the trade mark “BED BATH N’ TABLE”.
BBNT is the owner of Australian Trade Mark Registration Numbers:
(a)654780 for the sign BED BATH ‘N’ TABLE, registered in class 24 (780 TM);
(b)654781 for the sign BED BATH ‘N’ TABLE, registered in class 42 (781 TM); and
(c)1878972 for the sign BED BATH N’ TABLE, registered in class 24 and class 35 (972 TM).
(collectively, the BBNT marks)
There is no challenge to the validity of the BBNT marks. They are taken as being distinctive and valid across the full scope of their registration.
Global Retail Brands Australia Pty Ltd (GRBA) is the owner of a business selling kitchenware and hard homewares under a trade mark incorporating the word “House”.
In addition, GRBA owns and operates retail stores under the following House sub-brands: “House WAREHOUSE”, “House OUTLET”, “House POP UP”, “House CASA | MAISON | HOME”, and “House Superstore” (as well as other brands, including “The Custom Chef”, “Robins Kitchen” and “MyHouse”).
In May 2021, GRBA began operating a new soft homewares business selling products for the bedroom and bathroom, using the following logo/mark:
(House B&B logo or House B&B mark)
The first House BED & BATH (House B&B) store was opened in the Doncaster shopping centre in Victoria. Since May 2021, GRBA has launched a number of other stores under the House B&B logo including at Chadstone shopping centre.
BBNT alleges that by launching House B&B, GRBA has:
(a)infringed the BBNT marks under s 120 of the Trade Marks Act 1995 (Cth);
(b)contravened s 18(1) and s 29(1)(a), (g) and (h) of the Australian Consumer Law (ACL) as contained in Sch 2 of the Competition and Consumer Act 2010 (Cth); and
(c)engaged in the tort of passing off.
GRBA’s alleged infringing conduct commenced in May 2021 when it opened its first House B&B store, trading under the House B&B logo. Therefore, that is the critical date to assess the reputation enjoyed by BBNT and the state of the soft homewares market in Australia.
GRBA denies each of the above allegations. It contends that its use of the words “bed” and “bath” is purely descriptive, the words are used as category or navigational descriptors to describe categories of soft homewares, and therefore the words do no work in designating commercial origin when read in conjunction with the well-known House trade mark.
Initially, GRBA sought to challenge various registered trade marks owned by BBNT through a cross-claim filed on 4 August 2021. By consent orders dated 8 November 2022, GRBA’s cross-claim was dismissed.
This hearing was on the issue of liability only. BBNT sought to be heard separately on relief if it was successful.
For the reasons given below, I am not satisfied that GRBA has infringed BBNT’s marks. However, I have found that GRBA has contravened s 18(1) and s 29(1)(g)–(h) of the ACL, and engaged in passing off.
2. WITNESSES
2.1 Lay witnesses
BBNT called the following lay witnesses, each of whom were cross-examined (aside from Mr Cruise):
(a)Mr Jonathan Dempsey, who made three affidavits dated 25 January 2022, 19 April 2022 and 27 September 2022. Mr Dempsey is the Managing Director and sole director of BBNT.
(b)Ms Kate Mackie, who made one affidavit dated 11 February 2022. Ms Mackie is the Head of Buying and Product Development at BBNT.
(c)Mr Rodney Cruise, who made one affidavit dated 24 December 2021. Mr Cruise is an expert intellectual property researcher and patent attorney.
BBNT also filed three affidavits from its solicitor, Mr David Longmuir, dated 4 February 2022, 28 September 2022 and 8 November 2022. Mr Longmuir was not cross-examined.
BBNT sought to rely on affidavits from 36 witnesses — who were either store managers, assistant store managers or sales staff — deposing to instances of alleged confusion. Early on the first day of the trial, I directed that BBNT select its best 10 “confusion” witnesses.
Following my direction, BBNT called the following “confusion” witnesses, each of whom were cross-examined:
(1)Ms Maria Michelle D’Alessio, a former assistant store manager at BBNT in Doncaster, Victoria. Ms D’Alessio made one affidavit in these proceedings dated 5 May 2022.
(2)Ms Natalie Anna Erdossy, an assistant store manager at BBNT in Chadstone, Victoria. Ms Erdossy made one affidavit in these proceedings dated 4 February 2022.
(3)Ms Elizabeth Rita Dimopoulos, a sales assistant at BBNT in Chadstone, Victoria. Ms Dimopoulos made one affidavit in these proceedings dated 16 May 2022.
(4)Ms Nicole Louise Harry, a former assistant store manager and current store manager at BBNT in Woodgrove, Victoria. Ms Harry made one affidavit in these proceedings dated 6 May 2022.
(5)Ms Giulia Lea Downes, a sales assistant at BBNT in Doncaster, Victoria. Ms Downes made one affidavit in these proceedings dated 4 May 2022.
(6)Ms Karis Rae Chatfield, a store manager at BBNT in Busselton, Western Australia. Ms Chatfield made one affidavit in these proceedings dated 23 February 2022.
(7)Ms Shelley Grace Timms, an assistant store manager at BBNT at DFO Perth, Western Australia. Ms Timms made one affidavit in these proceedings dated 14 February 2022.
(8)Ms Honor Bettina van der Plight, a store manager at BBNT in Doncaster, Victoria. Ms van der Plight made one affidavit in these proceedings dated 10 February 2022.
(9)Mr Mitchell John Andrew Tabe, an assistant store manager at BBNT in Doncaster, Victoria. Mr Tabe made one affidavit in these proceedings dated 4 May 2022.
(10)Ms Tori Vigors, an assistant store manager at BBNT in Busselton, Western Australia. Ms Vigors made one affidavit in these proceedings dated 3 May 2022.
GRBA called the following lay witnesses, each of whom was cross-examined (aside from Mr Butler):
(1)Mr Steven Lew, the founder, Executive Chairman and a director of GRBA, who made three affidavits dated 6 May 2022, 22 August 2022 and 19 October 2022. He is also a director of Global Retail Brands Pty Ltd, the parent company of GRBA, and the Executive Chairman of several companies, including:
(i)House, which his website (< describes as “Australia’s #1 largest specialty kitchenware retailer”;
(ii)Robins Kitchen, which his website describes as “Australia’s #2 largest specialty kitchenware retailer”; and
(iii)the Playcorp Group of Companies, which distributes apparel to third-party customers.
(2)Ms Ashleigh Cameron, GRBA’s Head of Design, who made one affidavit dated 6 May 2022.
(3)Ms Meghan Jane McGann, GRBA’s Head of Brand and Media, who made one affidavit dated 6 May 2022.
(4)Mr Darron Gary Kupshik, a director and the Chief Operating Officer of GRBA, who made two affidavits dated 6 May 2022 and 19 October 2022.
(5)Ms Kylee Ann Brodrick, a regional sales manager at GRBA, who made one affidavit dated 5 August 2022.
(6)Mr Bernard Bartholomew Caruana, GRBA’s Store Development Manager, who made one affidavit dated 6 May 2022.
(7)Ms Janice Nicola Mary Turner, shop manager at House B&B in Halls Head, Western Australia, who made one affidavit dated 4 August 2022. She was previously employed by BBNT as a store manager for eight years.
(8)Ms Jennifer Powell, a store manager at House B&B in Chadstone, Victoria, who made one affidavit dated 10 August 2022.
(9)Ms Louise Mary Sevenich, a sales consultant at House B&B in Chadstone, Victoria, who made on affidavit dated 5 August 2022.
(10)Mr Christopher Butler, the Office Manager at the Internet Archive in San Francisco, United States, who made two affidavits dated 21 December 2021 and 24 October 2022.
GRBA also filed four affidavits from two of its lawyers (neither of whom were cross-examined):
(a)Three affidavits of Ms Robynne Sanders dated 17 December 2021, 5 August 2022 and 19 October 2022; and
(b)One affidavit of Mr Ben Mawby dated 6 May 2022.
2.2 Expert witnesses
BBNT called independent marketing expert evidence from Professor Don O’Sullivan who made one affidavit dated 14 February 2022. Professor O’Sullivan is a professor of marketing at the Melbourne Business School, University of Melbourne, and has held various academic roles since 1992.
GRBA called independent expert evidence from Associate Professor Gergely (Greg) Nyilasy who made one affidavit dated 6 May 2022. Associate Professor Nyilasy is a professor of marketing and entrepreneurship at the Melbourne Business School, University of Melbourne, and has held various academic roles since 2010.
The experts prepared a joint expert report and gave evidence in person by way of a concurrent evidence session.
3. CORE FACTS
3.1 Soft homewares
The term “soft homewares” encompasses textile goods, such as bedding and bed linen (for example, sheet sets, pillowcases and quilt covers), bathroom products (bath linen, such as towels, and bathroom accessories, such as soap dishes and shower caddies), household linen (for example, table cloths, table runners, napkins, teas towels and place mats), kitchenware (for example, cutlery, plates and bowls, serving ware and glasses, cups and mugs) and other homewares (for example, cushions, throws, vases and candles).
The parties adopted the term “soft homewares” to refer to bedroom and bathroom products as described above, to be contrasted with “hard homewares” such as pots, pans, plates, knives and cutlery. I have adopted that definition in these reasons.
3.2 Bed Bath N’ Table
BBNT has continuously traded in Australia under, and in respect of, the trade mark comprising the words “BED BATH N’ TABLE” since 1976. The BBNT business operates throughout Australia and retails soft homewares in both physical stores and online. It has retailed a vast range of soft homewares products, including textile goods, such as bedding and bed linen, bathroom products, household linen, kitchenware, and other homewares. BBNT does not sell beds, baths or tables.
BBNT has approximately 30% of the Australian market share of the speciality homewares and allied products market based on store numbers. Mr Dempsey considered that BBNT’s main specialty competitors (that is, businesses that specialise in bed linen, bathroom products and household linen) were Adairs, MyHouse, Pillow Talk, Linen House and Sheridan. Other notable competitors selling bed linen and bathroom products are Myer, Kmart, Target, Domayne, Canningvale (online only), Spotlight, Westelm, Pottery Barn, Big W, Best & Less, Freedom, Temple & Webster (online only), Harris Scarfe and David Jones. As at December 2021, Adairs operated about 159 physical stores, and Sheridan operated around 57. BBNT operated 167 physical stores at that time. Mr Dempsey stated in his first affidavit that “Adairs is our closest competitor, in my opinion, both in terms of market share and look and feel”.
Confidential sales data showed that as at 2021, BBNT had annual sales in the hundreds of millions of Australian dollars. BBNT is evidently a significant business and occupies a dominant position in the speciality soft homewares sector.
On the basis of BBNT loyalty and customer information, Mr Dempsey’s evidence was that the main BBNT customer demographic is predominantly female and in the 25–65 age bracket.
BBNT’s branding is carefully managed through regimented “brand guidelines” and has consistently, since at least the mid-1990s, been presented in block capital letters on a plain background, as shown below:
Store signage typically appears with illuminated white letters, with green on the inside of the letters and no background, and also in frosted white writing on the front glass of the store.
BBNT has used its branding in full and without alteration on a dark green background in respect of its clearance outlets and rewards program, as shown below:
The BBNT mark has appeared on packaging of some of BBNT’s goods and on ancillary point of sale and related materials, such as invoices, bags and catalogues.
BBNT has made very substantial sales of products from BBNT stores for decades and has also spent considerable funds on advertising featuring the BBNT mark, including the distribution of many millions of catalogues and the sending of many millions of promotional emails each year to the members of its loyalty scheme. BBNT has also advertised extensively in magazines such as Better Homes & Gardens, Australian Style, Home Beautiful, Vogue Living and Australian Country Style, and newspaper lift out supplements and weekend magazines. BBNT’s business has also been featured on television programs including Channel 7’s “Postcards” and Channel 7’s “House Rules”. More recently, BBNT has shifted its advertising focus more towards online advertising on its website, social media and email.
Mr Dempsey accepted that BBNT did not shorten the BBNT name on the internal or external signage of its store, in any advertising or on the BBNT website.
3.2.1BBNT stores
BBNT stores generally operate in prime retail locations with high consumer traffic, such as major shopping centres like Westfield Doncaster shopping centre where the first House B&B store opened.
According to BBNT’s statement of claim, each BBNT store front typically has:
(a)a prominent store front appearance including an open glass store front displaying homewares;
(b)prominent display signage bearing the BBNT mark appearing above the entryway to the store;
(c)the BBNT mark in frosted writing on the front glass of the store; and
(d)BBNT signage visible through the front windows and/store entryway.
(the BBNT Get-up)
Mr Dempsey gave evidence in his first affidavit and during cross-examination of more factors of get-up than are listed in the statement of claim, including the finishes of the store floors, the point of sale signage and the product signage.
Mr Dempsey’s evidence was that BBNT stores are carefully designed to create a home/boutique feel, with a bed or beds and linen/pillows displayed in the front windows, which he said was consistent with conveying a sense of quality and trust to consumers. He considered the store’s design to be a key element of consumer association with the BBNT brand, as being able to feel and experience the product was important to BBNT customers. The design is meant to approximate what you find in a good home. The presentation of a typical BBNT store is shown below:
BBNT accepts that a store front including an open glass display of homewares and made-up beds is not unique to BBNT. BBNT claims that what is unique about the BBNT store presentation was the Get-up in combination with the store name. As depicted above, the BBNT store front also includes prominent display signage with “BED BATH N’ TABLE” (see above left on the vertical blade sign). BBNT contends that this display signage is a common feature to all its BBNT stores. The words “BED BATH N’ TABLE” also appear prominently above the doorway in white illuminated writing.
BBNT stores promote exclusive lines of products, such as Morgan & Finch and Sleeping Beauty. It also promotes some third party branded products such as Sanderson, Harlequin and Morris & Co, which are produced under licence and a related company is the exclusive distributor in Australia. Products under those brands, and other house brands such as “Cotton House” are only available through BBNT stores or, for select products, are supplied to David Jones by BBNT.
In around 2016, BBNT launched a customer rewards scheme called “HOMEstyle — BED BATH N’ TABLE”. This was promoted in-store through printed flyers encouraging customers to join. The BBNT customer rewards scheme rewards loyal customers and offers exclusive everyday savings, along with access to special offers and VIP events throughout the year. Customers can join the program in-store or online. Loyalty scheme members receive regular emails from BBNT. As at May 2021, the BBNT customer loyalty scheme had almost 3 million members in Australia.
3.2.2BBNT online and social media presence
BBNT launched its online store in November 2013 (< BBNT products are offered for sale through the BBNT online store.
Since August 2017, BBNT has operated a Facebook page at < As at January 2022, the BBNT Facebook page had been liked approximately 130,000 times.
BBNT operates an Instagram account at < As at July 2021, the BBNT Instagram page had 285,000 followers.
BBNT also operates a Pinterest account at < As at December 2021, the BBNT Pinterest page had 7,100 followers.
BBNT undertakes digital display advertising which includes advertising via publisher websites such as Google or Facebook, and Google search advertising.
3.2.3BBNT brand extensions
BBNT has also launched a number of concept stores, each of which included the use of “BED BATH N’ TABLE” in full and without alteration, on a dark green background, with other trade marks such as “THE WORKS”, as shown below:
BBNT holds a trade mark registration for “THE WORKS”. However, Mr Dempsey accepted that “BED BATH N’ TABLE THE WORKS” (THE WORKS) was a single brand, which leverages off the parent brand.
THE WORKS stores are larger in size than traditional BBNT stores and offer a wider variety of products, including cookware, dinnerware, home fragrances, handbags, gift cards, stationery and home décor items. However, THE WORKS stores still carry all the products carried by traditional BBNT stores, such as bed linen and towels.
For a few years in the mid-2010’s, BBNT also operated two stores in Chatswood Chase in Sydney and Chadstone shopping centre in Victoria as HOMEWORKS. As shown in the images below, the BBNT mark on the dark green background was underneath the word HOMEWORKS. Mr Dempsey considered that it was important that the other BBNT stores retained the BBNT brand identity and endorsement, which was maintained via the BBNT mark still featuring in the store branding.
3.3 GRBA
As well as House, GRBA owns several other brands, including The Custom Chef, Robins Kitchen, MyHouse and PetHouse Superstore.
In 2014, GRBA acquired the assets of Lineville Pty Ltd, which had gone into liquidation and traded as Robins Kitchen. Robins Kitchen was a hard homewares retailer, which Mr Lew described as being similar to House. GRBA reopened the Robins Kitchen stores and, as at 2022, there were around 60 Robins Kitchen physical retail stores and an online store. Robins Kitchen stores sell essentially the same products as House branded stores.
House stores are located in areas with high foot traffic, and often near supermarkets. GRBA follows the same strategy for Robins Kitchen stores, but GRBA prefers to place Robins Kitchen stores at the opposite end of the shopping centre to the House store. As a result, generally if a Robins Kitchen store is located near a Woolworths, Coles or Aldi, the House store will be at the other end of the shopping centre, near the other supermarket/s present in the shopping centre. Mr Lew said that the co-location strategy with House and Robins Kitchen has been successful for GRBA.
According to Mr Lew, it was GRBA’s practice to apply for trade marks when it made a foray into a business outside of what the customer would deem the traditional House area of kitchenware and cookware. Examples were PetHouse SUPERSTORE and House CASA | MAISON | HOME.
3.3.1House
Since at least 1978, GRBA’s predecessors operated retail stores in Australia under the brand “House”. GRBA acquired that business in July 2007 and, as at May 2021, there were approximately 100 physical “House” branded stores open throughout Australia, selling kitchenware and hard homewares. The House stores are generally located in major shopping centres or retail precincts, often near supermarkets, and prominently feature the House mark. GRBA has a substantial reputation in House as a retail brand throughout Australia. In May 2021, the House brand was well-established in the hard homeware market.
House stores typically feature discount marketing in crowded displays with discount signage, typically in yellow and red. The signs display phrases such as “UP TO 80% OFF” and “CLEARANCE CLEARANCE CLEARANCE”. The signs are prominent, often covering most of the shopfront windows and are hung as bunting across the tops of store doorways. House stores are in an open format and, consistent with selling hard homewares not soft homewares, do not have beds in the window. Each House store has between 1,500 and 2,000 sales tickets on products and shelves, the majority of which feature the House mark. The presentation of typical House stores is shown in the two images below:
Mr Lew’s evidence was that House currently has seven sub-brand stores that it trades under and that 30% of House stores are sub-branded. GRBA owns and operates, or has operated, retail stores under the following House sub-brands: House WAREHOUSE, House OUTLET, House POP UP, House CASA ׀ MAISON ׀ HOME, and House Superstore.
GRBA commenced use of the trade mark “House WAREHOUSE” in 2014 for stores located in homemaker or outlet centres, not shopping centres. Mr Lew’s evidence was that the word “warehouse” was selected to inform consumers that the stores were selling higher volumes of product at cheaper prices. The House WAREHOUSE logo is shown below:
GRBA commenced use of the trade mark “House Superstore” in 2021. GRBA uses that mark on stores with a large footprint that sell a wide range of products. House Superstores are located in Ballina, Kalgoorlie and Warrnambool and sell everything for every room in the house. These stores therefore sell products from both traditional House stores (hard homewares) and from House B&B stores (soft homewares). The House Superstore logo is shown below:
GRBA operates an online House store at < that is visited by “many millions of users”. The House B&B website can be accessed from a tab on the House online store.
GRBA sells a large range of products in its House branded retail stores. Around 95% of all the products sold in House stores are supplied to GRBA by a related company, Playcorp. Playcorp sources its products from supplier factories and then resells them to GRBA. Only about 5% of products sold in physical House stores is supplied by independent third-party suppliers, with the balance supplied by Playcorp. The figure is approximately 25% for the House website. The products supplied by Playcorp are not branded House. All products sold through House branded retail stores are branded with other trade marks.
GRBA has 15 registered trade marks which incorporate “House”, including multiple trade marks with the words “for home and kitchen”. All trade marks for the House logo (except for one) use the same capitalisation and font as the logo shown below:
3.3.2GRBA’s earlier attempt to enter the soft homewares market
Despite House branded stores focussing on hard homewares, House has always sold some soft homewares that are associated with kitchenware, such as napkins, placemats, aprons and tea towels. However, in 2008, GRBA tried (unsuccessfully) to enter the soft homewares market under the brand “House CASA | MAISON | HOME”. In addition to selling hard homewares, these stores also sold bedroom and bathroom products, and other home decorations products.
GRBA has several trade mark registrations for the words “CASA | MAISON | HOME” in a large number of classes. GRBA has a trade mark registration for the House CASA ׀ MAISON ׀ HOME logo as depicted below:
Mr Lew referred to CASA ׀ MAISON ׀ HOME as a “sub-brand”. Mr Lew’s evidence was that the tag line “CASA MAISON HOME” was added to the House trade mark to differentiate these stores from traditional House stores, whilst still using the House brand to take advantage of existing customer brand recognition.
According to Mr Lew, the inclusion of “CASA MAISON HOME” in the brand was unsuccessful in differentiating these stores from traditional House stores as consumers did not recognise the difference. Nor did they associate House CASA | MAISON | HOME stores with bedroom, bathroom and home decoration products. This is evident from the picture of a House CASA | MAISON | HOME store front below, as these stores looked far more like the traditional House stores selling kitchenware than a soft homewares store.
After about two years, GRBA discontinued bedroom, bathroom and home decoration products from these stores.
3.4 Reputation
Both BBNT and GRBA accept that the other has a substantial and independent reputation in their respective marks: BED BATH N’ TABLE and House.
The experts agree that the BBNT mark appears prominently on stores and that BBNT is a well-established brand in the soft homewares category with which many consumers are likely to be familiar. As GRBA’s witness Ms Turner observed: “Everybody loves Bed Bath ‘N’ Table. Who doesn’t love Bed Bath ‘N’ Table? You know, it’s a great store.”
BBNT says that, despite its name, it is not engaged in selling beds, baths or tables and therefore “BED BATH N’ TABLE” is an arbitrary combination of words.
The experts made similar comments regarding the House brand being featured prominently on stores, well-established and recognised by consumers in its particular category — hard homewares. Mr Lew agreed that the mark House was itself inherently descriptive, but that GRBA had established reputation in that mark through extensive usage in over 140 stores, trading over four decades.
3.5 Other retailers in the soft homewares market
The major retailers in the soft homewares market in Australia may be classified broadly into department stores, speciality linen stores and discount department stores. The retailers include Adairs and Sheridan (specialty linen stores), Myer and David Jones (department stores), and Kmart, Big W, Target and Harris Scarfe (discount department stores). There were also a range of other smaller specialty retailers selling soft homeware products, including Pillow Talk and Linen House. Mr Dempsey gave evidence that increasingly bed linen, bathroom products and household linen are sold through retailers which operate predominantly online (such as Temple & Webster) and through the online stores of retailers which have physical stores. Both Adairs and Sheridan were well known as specialty linen retailers. Mr Dempsey agreed that Adairs was BBNT’s closest competitor. Mr Lew also considered that the leading specialty competitors of House B&B, in addition to BBNT, were Adairs and Sheridan.
The experts and relevant lay witnesses all agreed that it is common for speciality retail linen stores to have similar store designs which comprises large shopfront glass windows with a made-up display bed visible through the windows near entrance and the store name over the entrance. This “Hamptons” style look with white walls, wooden floorboards and no discount signage is intended to convey “a quality image” and a home feel that is luxurious and upmarket. This differentiates these stores from those with a strong discount focus, such as House, JB-HIFI or Chemist Warehouse, which tend to use yellow markdown signage.
None of BBNT’s existing competitors use “bed” or “bath” in their name. Until GRBA’s launch of House B&B, BBNT had been the only retailer in Australia that used the words “bed” and “bath” in its name for over 40 years.
3.6 Cross-promotion
Cross-promotion with other brands or related brands is a common practice in the soft homewares sector. For example, Adairs has had cross-promotions with Urban Home Republic, and Pottery Barn has had cross-promotions with its related brands West Elm and William Sonoma.
As noted above, BBNT sells exclusive lines such as Morgan & Finch and Sleeping Beauty as well as some third party branded products such as Sanderson, Harlequin and Morris & Co, which are produced under licence and a related company is the exclusive distributor in Australia.
3.7 Co-location of soft homewares stores
Partly as a result of shopping centres tending to group like stores together, specialty soft homeware retailers like Adairs, Sheridan and BBNT are often clustered together in “precincts” in shopping centres. As a result, House B&B is in close proximity to BBNT in many shopping centres, such as Doncaster where the first House B&B store was opened.
Ms Chatfield, in the course of giving confusion evidence, asserted that the geographic proximity between BBNT and House B&B stores, some often 100 metres apart, and the fact they both displayed bedding products in the store window, contributed to customer confusion.
Ms Turner gave evidence that in Western Australia “you will always find that Bed Bath N’ Table was beside Adairs or House was beside us”.
House and BBNT were often found in the same shopping centres, but not necessarily in close proximity to each other in the same centre as they sold different goods.
3.8 Consumers
Both parties accepted that the relevant class of consumer shopping for soft homewares is the general public or the “ordinary reasonable consumer”.
One thing to emerge from the “confusion” evidence (discussed below) was how little attention many customers appeared to pay to the store that they were entering. Many appeared unconcerned as to the particular shop that they were in until they were seeking to use a voucher or scan their loyalty card. According to Ms Turner, “a lot of people come in and they don’t know where they are”.
Ms Turner gave evidence that when she worked at BBNT, sometimes customers would pull out an Adairs loyalty card when at the BBNT register. According to Ms Turner, there were “hardcore” Adairs, BBNT and Sheridan customers and then there were the general customers that were looking for a particular item who were not concerned which shop they bought it from.
There was a wide spectrum of consumer involvement in the decision to enter a soft homewares store. At one end, some consumers would be browsing between stores in the soft homewares precinct, whilst at the other end, a consumer might be seeking a particular item such as a quilt cover from a particular retailer.
One group of consumers was undoubtedly focussed on what store they were entering. These were the consumers that had purchased a product online via “Click and Collect” and were attending the store to collect the product that they had purchased. For these consumers, it was important to be attending the correct store.
As I will discuss further below, the witnesses who gave evidence regarding confusion at shopping centres, where customers were either confused about which store they were in or simply did not know where they were, often had imperfect recollections about these interactions and therefore such evidence must be treated with some caution.
3.9 Sub-branding
Professor O’Sullivan’s evidence was that it is common for companies to market a product or service using two brands — a family brand (a brand that sits across multiple products or services) and a sub-brand (a product or service-specific brand). He considered that consumers were highly accustomed to this multi-brand approach to marketing. He gave as examples:
(a)Nestlé using both Nescafé and Gold Blend together to market a range of soluble coffee; and
(b)Woolworths using its apple peeling logo in the logo for its Metro stores.
According to Professor O’Sullivan, sub-branding is commonly used in retail settings where a company wishes to signal that it is introducing a new range or retail format (either through organic growth or acquisition), or that it is collaborating with another brand or has integrated (acquired) another brand. Associate Professor Nyilassy in the joint session did not disagree with this aspect of Professor O’Sullivan’s evidence.
Other sub-brand examples from Professor O’Sullivan’s evidence, included by GRBA in its submissions, included:
(a)Adairs launching “Adairs Kids” for retailing homeware products relating to children;
(b)Cotton:On launching “Cotton:On KIDS” for retailing children’s clothing;
(c)Toys R Us launching “Babies R Us” for retailing baby-related products; and
(d)Coles launching “Coles Express” in relation to a range of convenience stores.
Adairs also has “adairs HOMEMAKER” and “adairs OUTLET”, and Cotton:On also has “Cotton:On BODY”. GRBA itself, of course, also has several House sub-brands as outlined above.
3.10 Use of “bed” and “bath” as category or navigational descriptors
There was evidence of substantial use by third party sellers of soft homewares in Australia of “bed” and “bath” as navigational or category descriptors both inside their physical stores or on their online stores. GRBA contends that such use is ubiquitous in relation to the retailing of bedroom and bathroom products. To take some examples:
(a)in the stores of major retailers and BBNT competitors:
(i)“BED & BATH”, and “Bed” and separately “Bath” in Big W stores;
(ii)“bed & bath”, “bath & bed”, “bedding” and separately “bath” in Kmart stores;
(iii)“Bath & Bed Linen” in David Jones stores;
(b)and on their (and other retailers’) websites:
(i)“BED & BATH” and “Bed and Bath” on the David Jones website;
(ii)“BED & BATH” on the Myer website;
(iii)“BED & BATH” on the Temple & Webster website;
(iv)“BED & BATH” on the Freedom website;
(v)“bed, bath & home” on the Harris Scarfe website;
(vi)“Bed, Bath and Kitchen” and “Bed, Bath & Kitchen” on the Kmart website;
(vii)“BED” and separately “BATH” on the Spotlight website;
(viii)“Bed” and separately “Bath” on the MyHouse website;
(ix)“Bath” and separately “Bedding” on the BIG W website; and
(x)“Bath & Beach” on the Sheridan website.
According to Mr Lew, “bed and “bath” are also used as category descriptors in catalogues.
Each of these examples of the use of the words “bed” and “bath” are navigational aids on websites or general category descriptors found inside shops and are seen by the consumer after they enter the physical store or enter the website. None of the examples in evidence were the use of the words “bed” and “bath” on store exteriors or external store branding. None of these uses is the use of the words “bed” and/or “bath” as a trade mark. As noted above, GRBA accepted that no retailer in Australia other than BBNT used “bed” or “bath” in its name.
Mr Dempsey accepted, albeit reluctantly, that “bed” and “bath” were commonly used in the industry for their descriptive nature to navigate customers to bedroom or bathroom products. BBNT itself has used “bed” and “bath” (and also “table) as navigational aids for consumers and as category descriptors on its own website from at least November 2013 until May 2021.
However, as can be seen from the examples extracted above where “bed” and “bath” are used as part of a composite phrase rather than used separately, the order of the two words is typically, but not always, “bed” and then “bath”. For example, in some Kmart stores and on David Jones’ website, “bath” precedes “bed”. Further, when used together and not separately, “bed” and “bath” are generally used in a composite phrase including “and” (or “&)” but in some cases, such as Kmart and Harris Scarfe’s websites, “bed” and “bath” are separated by commas in a composite phrase with a third category (“bed, bath & home” in the case of Harris Scarfe and “Bed, Bath and Kitchen” in the case of Kmart). These examples highlight that BBNT is far from the only retailer to use “bed and bath” or even “bed, bath and [other]” as a composite phrase to describe categories of products, even if they are the only retailer to use that combination of words in their name and in trade marks. Professor O’Sullivan explained that “[c]onsumers who visit [BBNT’s] website would learn that bed is a shorthand for bedroom ware, and bath is a shorthand for bathroom ware”.
Associate Professor Nyilasy’s evidence was that “almost every one of BBNT’s ‘most significant competitors’ uses similar terms to the words bed and bath to categorise their products” and that “therefore the category of bed and bath products in general will come to mind when [consumers] see the words bed and bath”. Associate Professor Nyilasy explained that bed and bath are “generic words that are overlearned and overused in everyday language”, there is “no amount of marketing that could erase those generic associations”, because “it’s impossible to erase the generic associations in people’s heads from these Anglo-Saxon words”.
GRBA therefore submits that the extremely generic nature of the words “bed” and “bath” is a core fact to be taken into account in the determination of the issues in this proceeding.
3.11 Google Analytics data
Mr Dempsey annexed a two-page report prepared by the BBNT marketing department from the Google Analytics data available to BBNT. The table was annexed to support his proposition that the terms “bed and bath” and “bed n bath” were frequently used by customers to locate BBNT’s website and online store.
The Google Analytics data records the terms searched by internet users on the Google search engine during the period January to October 2021, before those users then clicked onto the BBNT website. The table prepared by the BBNT marketing department displays results from the Google Analytics data in columns under headings including “search query”, “clicks”, “impressions” and “CTR”.
The number of “clicks” is the measure of the number of clicks on the < website from a Google Search results page, not including clicks on paid AdWords search results. The number of “impressions” refers to the number of times any URL from the < website appeared in search results viewed by a user, not including paid AdWords search impressions. The CTR or “click through rate” provides an indication of the extent to which users considered or treated any listing on Google as responsive to their Google search. The CTR was calculated as a percentage of the impressions which ultimately result in clicks to the BBNT website (CTR = clicks/impressions x 100).
The data in the table is arranged from the search term with the highest clicks to the term with the lowest clicks. BBNT claimed that the search results are confidential, and therefore I will refer to them in broad terms without using actual figures.
The top three search terms used by internet users before navigating to the BBNT website were:
(1)“bed bath and table” (by far the largest number of clicks and impressions, by an order of 10 times larger than the next most clicked search term);
(2)“bed bath n table”; and
(3)“bed bath table”.
All of these top three search terms had a CTR in the low 70%.
The term with the fourth highest amount of clicks, “bed and bath”, had a similar number of impressions to the second and third terms, but around half the clicks, with a corresponding CTR of around half that of the second and third terms.
Many of the other search terms listed on the first page of the Google Analytics data as generating clicks on the BBNT website also featured the BBNT brand as a composite whole, including: “bedbathntable”, “bedbath and table”, “bed bath & table”, “bed bath and table sale”, “bed bath and table outlet”, “bed bath and table nz”, “bath bed and table”, “bed bath and table christmas”, “bed bath and table cushions”, “bed bath and table quilt covers”, “Bed and bath table”, “bedbathandtable”, and “bedbathtable”.
It appeared from the results that when internet users searched for the BBNT brand as a composite whole and were presented with a hyperlink to the BBNT website, they generally visited the BBNT website. Namely, the CTR to the BBNT website was high when internet users searched for the BBNT brand by using some combination of the words “bed”, “bath” and “table”. In contrast, it was rare for internet users to visit the BBNT site after searching for “bed” and/or “bath”. Mr Dempsey accepted in cross-examination that the Google Analytics data demonstrated that approximately 95% of the clicks on the URL < followed the entry of search terms other than “bed” and “bath” simpliciter.
GRBA sought to highlight the disparity by observing that a higher percentage of internet users clicked through to the BBNT website after searching for “silk face mask” than those who searched for “bed bath” or “bed & bath”. More than 80% of users who searched those two terms did not click through to the BBNT website.
Mr Dempsey conceded that it is not possible to tell from the Google Analytics data whether when an internet user typed the words “bed bath” into Google, they were searching for BBNT or using the words “bed bath” as a category descriptor.
Every reported occasion in the table where a Google search was undertaken for a BBNT store at a specific location in Australia, each of the words “bed” “bath” and “table” were used, together with the location. For example, internet searches for “bed bath and table hobart”, “bed bath and table adelaide”, “bed bath and table perth”, “bed bath and table ballarat”, “bed bath and table canberra”, “bed bath and table hawthorn”, “bed bath and table bendigo”, “bed bath and table geelong”, and “bed bath and table townsville”, were all reported as generating clicks on the BBNT website. In contrast, there were not any reported searches for “bed bath” or “BED & BATH” linked to any location in Australia.
3.12 Tendency to shorten
BBNT contends that there is evidence of consumers and others dealings with BBNT to refer to the store as “BED BATH” or “BED & BATH”. The tendency of consumers to truncate, shorten and abbreviate store or other names is well-known and entirely natural, as was recognised in London Lubricants (1920) Limited’s Application (1924) 42 RPC 264 at 279 (per Sargant LJ).
BBNT primarily relied on the evidence of its store managers and employees to support the existence of this tendency to shorten. Each of Ms Erdossy, Ms D’Alessio, Ms Dimopoulos, Ms Harry, Ms Downes, Ms Chatfield, Ms Timms, Ms van de Plight, Mr Tabe and Ms Vigors gave evidence that they experienced customers shortening the BBNT name to “BED BATH”. However, these witnesses provided significantly varying estimates of how often they experienced customers shortening the BBNT name. The estimates ranged from only “a few occasions”, to “once every two months”, to “a few times a month”, to “about once a week”, to “once or twice a day”, to 50%, to 60%, to 80%, and even 95%.
The evidence from store employees is essentially survey evidence. However, the survey evidence presented by BBNT is of a very low quality because it is not randomised or representative and derives from highly generalised, subjective recollections. BBNT did not undertake any properly controlled consumer survey to establish the extent to which consumers might abbreviate the BBNT name, or adduce evidence from a single consumer as to their own practice in abbreviating the BBNT name. The evidence derives purely from BBNT’s handpicked “10 best” store witnesses (and some of the other store witnesses who were not called). This Court has rejected the utility of survey evidence of this kind (not randomised, representative or properly conducted) on numerous occasions: Telstra Corp Ltd v Phone Directories Co Pty Ltd (2014) 107 IPR 333 at [332] (per Murphy J); Samsung Electronics Australia Pty Ltd v LG Electronics Australia Pty Ltd (2015) 113 IPR 11 at [346] (per Nicholas J); Australian Postal Corp v Digital Post Australia Pty Ltd (2013) 105 IPR 1 at [49] (per North, Middleton and Barker JJ); Adidas AG v Pacific Brands Footwear Pty Ltd (No 3) (2013) 103 IPR 521 at [180]–[212] (per Robertson J); Apple Inc v Registrar of Trade Marks (2014) 109 IPR 187 at [219]–[231] (per Yates J).
I therefore give the evidence of BBNT’s store employees some weight as it showed that a reasonable number of consumers have a tendency to shorten BBNT to “BED BATH” or “BED & BATH”, but I do not think it is conclusive of establishing that tendency.
BBNT also relied on some further evidence of shortening.
Ms Mackie provided evidence of third parties emailing BBNT and shortening the name of BBNT to “BED BATH” or “BED & BATH”. However, each of the seven examples provided by Ms Mackie were from overseas correspondents and therefore I give this evidence very little weight as it does not reflect the tendency of ordinary consumers in the Australian market. Ms Mackie did not provide any examples of local customers, staff or suppliers shortening the name of BBNT in email correspondence. Nor did any other BBNT witness provide such evidence.
Mr Dempsey gave the following examples of shortening by the media and general public:
(a)A news reporter said “Bed and Bath” on the Today Show on Channel 9 on 24 October 2021 in reference to BBNT hiring staff post-Covid lockdown.
(b)A disgruntled customer said “Bed and Bath” in a Facebook livestream on 19 November 2021 when she complained that she was denied entry into a BBNT store due to vaccination requirements.
Again, these examples have no representative weight to establish a tendency among the ordinary consumer.
Finally, BBNT pointed to evidence of GRBA staff shortening the name of BBNT. Ms Kuzmanovich, GRBA’s state manager of Western Australia, referred to a BBNT store as the “Bed Bath store”. Further, both Ms Turner and Ms McGann referred to BBNT as “Bed Bath” in cross-examination. These are all one-off examples of shortening and not necessarily supportive of a general tendency among GRBA staff, let alone consumers, to shorten the BBNT name. Notably, BBNT did not point to any documentary evidence, such as internal email correspondence, of BBNT staff shortening the name.
Even if I was wholly satisfied that consumers have a tendency to shorten the BBNT name, I do not consider that, in any event, BBNT has established that it has any independent reputation in “BED BATH” or “BED & BATH” alone.
As Associate Professor Nyilasy explained, there is “a difference between the informal and formal use of Bed and Bath”. The mere fact that consumers might, in certain contexts such as instore, contract the BBNT name, does not mean that consumers will expect the contracted words “BED BATH” to be “institutionally applied” (ie used by BBNT as a badge of origin). Associate Professor Nyilasy said that consumers will not “form that expectancy” unless there has been institutional use of that contraction.
In this case, the evidence was clear that BBNT had not made any institutional use of “BED BATH”. To the contrary, BBNT strictly followed its brand guidelines at all times, which required use of the brand only as a composite whole. Mr Dempsey accepted that BBNT had not contracted its brand to “BED BATH” in any advertising or promotion prior to May 2021. He agreed that BBNT used the BBNT mark in full (not contracted) on social media, such as Facebook, Instagram, Pinterest, and on its online store. Further, in its history of brand extensions and sub-brands, BBNT has always used the whole of the BBNT name in unaltered form, in combination with the dark green colour background. In so doing, BBNT has further reinforced to consumers that it is the composite phrase “BED BATH N’ TABLE” which indicates a commercial connection with BBNT, and not simply “BED BATH” or “BED & BATH”.
The Google Analytics data reflects that BBNT’s institutional consistency in using the composite whole of the name has been digested by consumers. As discussed above, the Google Analytics data clearly recorded that when internet users searched for BBNT, they overwhelmingly did so by searching for the BBNT brand as a composite whole, and when they searched for specific BBNT stores, they exclusively did so by reference to the BBNT name as a composite whole. I give this objective evidence more weight than the subjective recollections of the BBNT store witnesses.
I therefore consider that, although consumers may have a tendency to occasionally shorten the BBNT name in informal settings such as in store or on the phone, BBNT has not established that it has a reputation, in any formal or institutional sense, in “BED BATH” or “BED & BATH” alone.
3.13 Instances of use of the House B&B mark
In an appendix to its submissions, BBNT listed 15 different instances of the use of the House B&B mark. These included examples of House B&B store signs (some of which are below) with and without the horizontal line between “House” and “BED & BATH”, where “House” was illuminated, where “House” was in solid black font, and where the “BED & BATH” was cut out from a solid block.
There were also examples of where “House BED & BATH” appeared on a single line on printed receipts, or on social media.
Finally, there were examples of use on gift cards, advertising, employee name badges, signage directories at shopping centres, store windows, domain names (such as < and various websites (such as < The image below shows one such example of frosted glass window decals:
4. ADOPTION OF THE HOUSE B&B NAME
In a very short timeframe and at the last minute before the launch of its new store in Westfield Doncaster shopping centre, GRBA resolved that House B&B would be a better brand than MyHouse, even though the MyHouse brand incorporated the word “House” and was a long-established business in NSW.
GRBA contends that the intention (and the effect) of GRBA adopting House B&B was to send a message that the well-known retailer House had moved away from its core activities, kitchenware and cookware, and extended its activities into bedroom and bathroom products.
BBNT contends that GRBA’s intention behind the adoption of the House B&B mark is relevant to the following issues:
(a)the ACL case;
(b)trade mark infringement;
(c)the question of deceptive similarity; and
(d)the good faith defence under s 122(1)(b)(i) of the Trade Marks Act if GRBA is found to have infringed the BBNT marks.
The events which led to GRBA’s last minute change from MyHouse to the House B&B mark and the layout of the House B&B stores were the subject of a significant amount of evidence and cross-examination.
The chronology of events leading up to the adoption of the House B&B mark is as follows.
In around June 2020, GRBA acquired the MyHouse business from administrators. MyHouse sold predominantly soft homewares (as opposed to the hard homewares predominantly sold through GRBA’s House and Robins Kitchen stores). The MyHouse stores consisted of a network of 26 stores in NSW and one in Victoria which closed shortly before the acquisition. After the acquisition, one MyHouse store re-opened in Victoria and two new stores were opened in Queensland.
GRBA initially planned to open over 50 MyHouse stores, and the set-up costs of the new soft homewares stores was substantial — in the many millions of dollars. Ms McGann agreed that the MyHouse acquisition and the intention to open another 35 stores was a very big investment for GRBA and one would expect great care to be exercised in thinking of branding options if the brand was to change.
As at around June 2020, House had little or no trading reputation in the soft homewares market. In fact, GRBA’s attempts to enter that market (as House CASA ׀ MAISON ׀ HOME) had largely failed, and therefore the entrance into this market was a new category for GRBA.
Mr Caruana, GRBA’s Store Development Manager, was instructed by Mr Lew to design a new fit out for the MyHouse stores. Mr Lew was looking for a fit out that was “more modern and consistent with how GRBA fitted out its other retail stores, but appropriate for a store that sold ‘soft’ furnishings”. Mr Caruana had not previously designed a fit out for a store that sold mainly soft homewares. His evidence was that his first step was to become familiar with the products sold in the MyHouse stores, as this would determine the types of product displays required. Mr Caruana also took external and internal photographs of a BBNT store (amongst others) as part of his research. As part of this process, Mr Caruana determined that, as the MyHouse stores had done prior to the acquisition by GRBA, at least one bed needed to be displayed at the front of each MyHouse store to ensure that customers could see the products (in particular, quilt covers) available for sale, including from outside the store.
Mr Lew also instructed Mr Caruana to include the concept of a “linen press” shelving located prominently close to a bed in store with quilt covers and pillow cases out of their packages to enable them to be placed on the bed so that customers could see how they looked and felt. At the instruction of Mr Lew, Mr Caruana designed the display bays for new MyHouse stores to display sheets and quilt covers in portrait, as opposed to landscape, orientation, the latter being the orientation generally used in most soft homewares stores.
According to Mr Caruana, the new design for the fit out of MyHouse stores needed to be consistent with GRBA’s design ethos for its other stores. In particular:
(a)it needed to have as much product as possible in the store, not kept in the back room;
(b)the design needed to be modular, to allow elements of the fit out to be used regardless of the dimensions of the store (for example, using six wall bays rather than eight); and
(c)the elements of the fit out had to be capable of being used in all stores operating under the MyHouse brand, to benefit from economies of scale on the cost of design and manufacturing.
In about June 2020, Mr Caruana met with Mr Lew and his wife in their home to discuss store features they wanted to integrate into the MyHouse store design concept. Mr Caruana presented the first store fit out sketches and they discussed and agreed upon colours, fastenings and finishes.
Due to the onset of the COVID-19 pandemic, GRBA did not open any new MyHouse stores in 2020. The first opportunity to do so arose in early 2021 when GRBA leased a store in Westfield Doncaster. This was to be the first new MyHouse store opened by GRBA since its acquisition of the MyHouse business. Mr Caruana described the Westfield store as a “warm shell”, meaning the previous tenants had left some of their fit out behind, including the flooring and wall treatments. The store was one floor above a BBNT store. Mr Lew visited the Doncaster site prior to May 2021.
Mr Lew informed Mr Caruana of the new Doncaster store by email on 13 April 2021. By this time, Mr Caruana had completed his design of the new MyHouse fit out, and so he started making arrangements to use the modular fit out components he had designed in this new MyHouse store.
As the new Doncaster store was large and square, Mr Caruana created a layout that had two beds in the windows promoting the products displayed, and a third bed on the main floor with the linen press nearby. Mr Caruana located the cash register where it had been for the previous tenant so that the existing electrical wiring and cabling would not need to be relocated.
On 28 April 2021, Mr Caruana emailed Mr Lew and Ms McGann, GRBA’s Head of Brand and Media, three layout options that he had prepared for the MyHouse store in Doncaster.
On the afternoon or evening of 3 May 2021 — at the “very last minute”, only days before the first MyHouse store was scheduled to open on 14 May 2021 in Westfield Doncaster — Ms McGann queried during a telephone call with Mr Lew whether it was “too late to consider rebranding and calling this a HOUSE branded store?”. Mr Lew’s initial reaction was that this was “a good idea”, as it would “allow GRBA to leverage off the goodwill associated with the HOUSE brand”.
On further reflection, Mr Lew considered that if the new store was branded House, GRBA could also use the House customer database and potentially negotiate better leases with shopping centres. It would also give customers more confidence in this new store as they were familiar with the House brand and, after only a year of trading, there was little awareness of the MyHouse brand outside NSW.
Later that day at 9.10 pm, Ms McGann emailed Mr Lew, stating:
Thanks for calling
We WILL make this work and more than that — SOAR.
Just on our chat
Something to mull over
SHE KNOWS WHAT WE DO WELL
WE OFFER EXCELLENT PRODUCT WITH A GREAT VALUE PRICE TAG
WHY DOES A [ROBINS KITCHEN] AND A [HOUSE] IN THE SAME CENTRE ALWAYS FAVOUR HOUSE IN SALES? — SHE KNOWS AND TRUSTS THE BRAND.
We have all this BRAND LOYALTY TO LEVERAGE
Just something to think about? Not 100% there myself but there is something in it??
Before we roll out too many MYHOUSE — One could be [HOUSE] — we could try?Aim to always open in the SAME centre so can push them either which way for deals — double our audience.
Will have Bed bath and table running scared.
HOUSE bed & bath.
HOUSE BATH AND BED
HOUSE BEDWORKS(the running scared email or 3 May 2021 email)
In cross-examination, Ms McGann described the second option of potential brand names (“HOUSE BATH AND BED”) as “playful”.
Mr Lew’s evidence was that the 3 May 2021 email was the first he had heard of “House BED & BATH” as a potential brand. Mr Lew’s evidence was that despite the reference to BBNT in the 3 May 2021 email, he and Ms McGann had never had a discussion about BBNT. Mr Lew rejected the proposition that the proposed name was derived from BBNT, saying “I never thought about Bed Bath ’N’ Table”, adding, what became a common refrain from Mr Lew and Ms McGann, “the words bed and bath are common descriptors in the category of all soft furnishings”. He also rejected the idea that the words “BED & BATH” triggered an association with the only competitor identified in the running scared email, BBNT, responding that “the terminology ‘Bed & Bath’ in that combination and usage of words is highly used by a lot of retailers, and it’s very highly understood by the consumer”.
Mr Caruana spoke with Mr Lew on 4 May 2021. During that conversation, Mr Lew said that he was thinking of changing the MyHouse store name.
In a text message to Ms McGann at 7.03 am on 5 May 2021, Mr Lew sent the House B&B logo from Ms McGann’s email of 3 May 2021 with the comment “I think you could be right”. Ms McGann’s text in response stated: “We start at 80% instead of 0% re roll outs with a customer base”. Ms McGann agreed that these figures were in relation to House entering the soft homewares market, and that she saw a significant advantage in being branded House B&B as opposed to MyHouse. Ms McGann considered “BED & BATH” to be a “callout to what categories we sell in that store”, to indicate to the customer that the shop would not be selling cookware. Ms McGann’s evidence was that House was the advantage — it had the customer database, the credibility, the trust and the recognition. Ms McGann described House B&B as the “same brand” with a completely different product offer.
At 7.32 am on 6 May 2021, Ms Cameron sent 12 House B&B logo concepts to Mr Lew, copied to Ms McGann. Each featured the House® mark with variations of “BED & BATH” in different fonts and all in upper case. For each version, there was a mock-up of how it would appear over a store entrance. Ms McGann and Ms Cameron were unable to explain the change to all upper case from the lower case version in her 3 May 2021 email.
At 7.40 am on 6 May 2021, Ms McGann responded to Ms Cameron’s email copying in Mr Lew, stating “I like 8 then 11”. At 9.56 am, Ms Cameron sent three sets of mocked up pairs of store fronts with House and House B&B on them, with “BED & BATH” scaled differently on each.
On 6 May 2021, Mr Lew made the final decision to proceed with the now House B&B logo as his preferred option. Following a request from Mr Lew’s executive assistant at 3.25 pm on 6 May 2021 to “fast track the registration of the HB&B logo in Australia in class 35 only”, Mr Kenmar, GRBA’s corporate lawyer, lodged a Headstart application with IP Australia for the House B&B logo at 5.03 pm that same day.
In an email to Mr Lew sent at 5.10 pm on 6 May 2021, Ms McGann commented “we need to do due diligence on some ‘house keeping’”. She then set out a number of queries (in bold) to which Mr Lew responded 20 minutes later by filling in the answer next to Ms McGann’s questions, including the following:
1.CHECK WITH LEGAL?
·HOUSE Bed & Bath
BEING FAST TRACKED ….. NOT A BIG CONCERN FROM LAWYERS.
·Check we can proceed — no objections
·Send logo off to register
When asked why it was necessary to check with legal, given the brand was “House”, Ms McGann responded that she was not sure whether there were any legal implications with the name change on the lease that GRBA had signed for the Doncaster store and whether GRBA could change its lease agreement with the centre. Ms McGann refused to concede that the “check with legal?” query related to a concern about using “BED & BATH” as a brand. She added after further questioning that she suggested they check with legal because “it is protocol in our company to check with Legal on almost everything we do in terms of brand, regardless of what the brand is”.
Ms McGann’s evidence on this issue was frankly unbelievable. Despite the email saying “send logo off to register”, Ms McGann said that she did not have trade mark issues in mind when saying check with legal. However, given that Mr Lew’s response referred to “being fast tracked”, which was the language used to request that Mr Kenmar “fast track the registration”, Ms McGann’s reference to concerns about the name on the lease is clearly not what Mr Lew took “check with legal?” to mean. Mr Lew’s evidence was that he understood “check with legal?” to mean “to check if the marks are available for registration” — that is, to see if GRBA could get the House B&B mark registered. It is therefore highly unlikely that Ms McGann intended to refer to the lease when she said “check with legal?”. This conclusion is supported by the fact that no one else at GRBA referred to seeking legal advice about the lease and there is no record of any such advice being sought. In my view, and for further reasons explained below regarding Ms McGann’s credibility as a witness, her explanation regarding the lease was likely a subsequent invention to avoid conceding that there might have been a concern about
“BED & BATH” being used as a trade mark.According to Mr Lew, the “fast tracking” related to the speed at which a response would be received in respect of the Headstart application. Mr Lew’s evidence was that a Headstart application gives a picture within around five days of whether there are any marks cited against the mark. Mr Lew’s evidence was that he understood the “check we can proceed — no objections” comment to be a reference to no objections coming from the trade marks office. In his comment about “not a big concern from lawyers”, the “concern” was as to the speed of response to the Headstart application. Mr Lew made no mention about seeking legal advice about the store lease.
On 6 May 2021, Mr Lew met Mr Caruana at the Doncaster store. Mr Lew asked Mr Caruana if he could get signage for the new brand made and put up in time for the launch of the store in four days. Mr Caruana agreed that he could get the signage made up in time as long as Mr Lew was happy for “House” to be illuminated like the other House stores, but not the other words, as Mr Caruana could use an already fabricated “House”. Mr Caruana gave evidence that the Doncaster shopping centre management imposes limitations on storefront signage, including that only one sign on the same façade is allowed to be illuminated in the store’s signage.
On 10 May 2021, Ms McGann sent an email to Mr Lew, copied to Mr Caruana, which discussed the possibility of an “additional semi transparent pull down screen behind the print banner so that the content in the bays doesn’t interfere with the visual on the beds”. The email noted that “Bed bath and table do it”.
On 11 May 2021, GRBA received an assessment from IP Australia which raised a single citation (unrelated to BBNT). According to Mr Lew, as GRBA had successfully overcome this citation in relation to other uses of its trade marks incorporating House in the past, he expected it would also be overcome in relation to House B&B. Mr Lew accepted that the Headstart application expressly noted that “Headstart cannot provide legal business advice such as … whether you will be infringing another trader’s common law rights”. Mr Lew’s evidence was that he understood that in order to be confident that GRBA was not infringing another trader’s common law rights he needed to get proper legal advice.
GRBA applied for the registration of the House B&B logo on 12 May 2021:
being trade mark application number 2176694. The application was accepted on 5 July 2021 but was opposed by BBNT, and the opposition is presently on hold.
On 13 May 2021, the new signage with the House B&B logo was installed at the Westfield Doncaster store. Mr Caruana’s evidence was that, other than the signage, the layout and fit out of the Westfield Doncaster store did not change from the original plans he had prepared when it was intended to be a MyHouse store.
On 14 May 2021, GRBA launched the House B&B store in Westfield Doncaster using the signage shown below:
Also on 14 May 2021, Inside Retail published an article titled “Full House: Steven Lew’s GRB unveils new homewares brand” which reported on GRBA’s launch of a new brand “House — Bed & Bath”. That same day, GRBA registered a number of domain names incorporating Housebedbath (.com, .com.au, .com.nz and .co.uk).
On 25 May 2021, BBNT’s solicitors sent a letter to GRBA, noting the existence of the BBNT marks, and BBNT’s “extremely high level of brand recognition throughout Australia, in the name BED BATH N’ TABLE”, and requesting that GRBA rename the new store at Westfield Doncaster. The letter noted that GRBA’s conduct in choosing to name its new store “House BED & BATH” was conduct which constituted misleading and deceptive conduct contrary to s 18 and s 29 of the ACL, passing off and trade mark infringement.
GRBA’s lawyers responded to this letter on 1 June 2021. The letter set out the trade mark registrations held by GRBA and noted that the House brand and trade marks were well known in Australia in the homewares sector. The letter noted that House B&B was a “clear brand extension” of the iconic House brand, and said that the mark was not deceptively similar to the BBNT marks. There was no mention of the concept of “bed” and “bath” being category descriptors or navigational aids. The letter appended a list of four registered trade marks which contained the words “bed” and “bath”.
GRBA opened a House B&B store in Knox shopping centre about a month after the Doncaster store opened. At the time that BBNT commenced these proceedings on 11 June 2021, there were two House B&B stores in operation. The Doncaster store closed in January 2022 as the lease on the store was only for seven months. Since May 2021, GRBA has launched a number of retail stores, each featuring either the use of the House B&B Logo or one of the other instances of the use of the House mark set out at [125] and [127] above.
On 13 October 2021, GRBA was advised by IP Australia that its trade mark application for House B&B was accepted. Mr Lew agreed that he knew that acceptance of a trade mark did not equate to registration of the mark.
4.1 Mr Lew’s evidence
Mr Lew has extensive business experience, including in retailing hard homewares. He publicly promotes himself as the founder and executive chairman of GRBA, Australia’s number one largest specialty kitchen retailer. The businesses under Mr Lew’s control have very significant annual revenue.
Mr Lew gave evidence that “brand” is very important to his business and in the home furnishing sector.
The second point is that Flick J was not dealing with a situation where the infringer’s conduct constituted wilful blindness.
Ultimately, even if I accept that Mr Lew and Ms McGann genuinely held the subjective belief that there was no similarity between the House B&B mark and the BBNT marks, and therefore no confusion would arise from the adoption of the House B&B mark, that is not sufficient to establish good faith for the purposes of s 122(1)(b). As Beach J observed at [118] in Flexopack:
If good faith were to be construed as merely being satisfied on the basis of a stated subjective belief that one did not know of the other, it could lead to a situation where one could justify trade mark use with one’s ignorance. The failure to make proper inquiries should not place a respondent in a better position than if such inquiries had been made.
As such, GRBA’s conduct in adopting the mark, discussed above at [234]–[241], does not constitute what I consider in the circumstances of this case to be proper enquiries or reasonable diligence to ascertain that its chosen name did not conflict with a registered trade mark: see Flexopack at [110] (per Beach J). Therefore, GRBA did not act in good faith in adopting the House B&B mark and, if I am wrong on infringement, GRBA cannot rely upon the defence in s 122(1)(b).
Finally, GRBA’s actions after receiving BBNT’s letter of demand on 25 May 2021, and thereby being formally put on notice of BBNT rights, are inconsistent with a party acting in good faith.
GRBA contends that BBNT is wrong to allege that the conduct of GRBA cannot cease to be use in good faith upon being put on notice of BBNT’s allegations. GRBA relies on the Full Court’s finding in Digital Post at [52], [56], [90] and [93] (per North, Middleton and Barker JJ) that the respondent was acting in good faith pursuant to s 122(1)(a) of the Act even though it was aware of potential confusion and the applicant’s reputation in the registered mark. However, as their Honours stated in Digital Post at [94] “[t]his is not a situation like Anheuser-Busch where there was wilful blindness to the potential for confusion”. This comment suggests that their Honours considered that good faith could not be established where wilful blindness is established.
That recognition makes it easy to reconcile the approach in Digital Post with Beach J’s far stricter approach in Flexopack. Although not described as such, Beach J in Flexopack was clearly dealing with a situation of wilful blindness as evinced by his Honour’s comment at [150] that any ignorance of the applicant’s trade mark was “only due to [the respondent’s] own indifference and his failure to make the inquiries that an honest and reasonable person would have made in his position”. This characterisation of Flexopack also disposes of GRBA’s reliance on Halal Certification Authority Pty Ltd v Flujo Sanguineo Holdings Pty Ltd (2021) 163 IPR 433 at [52], [67], [123], [132], [135] and [141]–[142] (per Bromwich J). In Halal Certification, Bromwich J described the infringer’s conduct as “honest” and “no more than an oversight” (at [67] and [141]) which clearly takes their conduct outside the realm of wilful blindness. These findings were not challenged on appeal in Halal Certification Authority Pty Ltd v Flujo Sanguineo Holdings Pty Ltd [2023] FCAFC 175 at [112]–[117] (per Nicholas, Burley and Cheeseman JJ).
I do not consider that a party who is wilfully blind to the prospect of infringing can be said to be acting in good faith when the likelihood of deception is expressly raised with them by the owner of the registered mark. In the circumstances of this case, once the potential conflict was brought to GRBA’s attention, it was impermissible for it to just keep ignoring and failing to investigate BBNT’s concerns or seek “proper” or substantive legal advice.
Accordingly, if I am incorrect on the question of trademark infringement, GRBA cannot rely upon s 122(1)(b)(i) as a defence to any infringement.
8. AUSTRALIAN CONSUMER LAW
BBNT alleges that by adopting the House B&B mark, GRBA has engaged in misleading and deceptive conduct. BBNT also has an alternative case based on the similarities in store get-up further reinforcing the association between the parties. However, BBNT does not advance a case with respect to similarities in store front get-up alone (without regard to branding) against GRBA.
For the reasons given below, I am satisfied that GRBA has engaged in misleading and deceptive conduct.
8.1 Relevant Provisions
Section 18(1) of the ACL, headed “Misleading or deceptive conduct” provides that:
A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
BBNT also alleges breaches of s 29(1)(a), (g) and (h) of the ACL. Section 29 is headed “False or misleading representations about goods or services”. Subsection (1) relevantly provides:
(1)A person must not, in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services:
(a) make a false or misleading representation that goods are of a particular standard, quality, value, grade, composition, style or model or have had a particular history or particular previous use; or
…
(g) make a false or misleading representation that goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits; or
(h) make a false or misleading representation that the person making the representation has a sponsorship, approval or affiliation; or
…
8.2 Principles
The High Court in Self Care at [80] summarised the well-established principles:
Determining whether a person has breached s 18 of the ACL involves four steps: first, identifying with precision the “conduct” said to contravene s 18; second, considering whether the identified conduct was conduct “in trade or commerce”; third, considering what meaning that conduct conveyed; and fourth, determining whether that conduct in light of that meaning was “misleading or deceptive or … likely to mislead or deceive”.
It is always necessary to commence by asking: “what is the alleged conduct?”. If that conduct constitutes conduct in trade and commerce, the High Court at [82] of Self Care identified that the third and fourth steps then require the court to characterise, as an objective matter, the conduct viewed as a whole and its notional effects on the state of mind of the relevant class of persons, judged by reference to its context. Their Honours noted that the context includes both:
·the immediate context — all the words in the document, or other communication and the manner in which those words are conveyed, not just a word or phrase in isolation. In Self Care, the immediate context included the surrounding words and the design of the packaging and the website.
·the broader context — the relevant surrounding facts and circumstances.
The non-contentious principles to be applied in assessing a breach of the ACL were set out by Beach J in Flexopack [259]–[277]. His Honour then summarised those principles in State Street Global Advisors Trust Co v Maurice Blackburn Pty Ltd(No 2) (2021) 164 IPR 420 at [708]–[717]:
[708] First, conduct will be likely to mislead or deceive if there is a real or not remote chance or possibility of misleading or deceiving. To assess this one looks at the potential practical consequences and effect of the conduct. And whether conduct is misleading or deceptive or likely to mislead or deceive is a question of fact, which must be determined having regard to all the relevant circumstances.
[709] Second, there is no meaningful difference between the words and phrases “misleading or deceptive”, “mislead or deceive” or “false or misleading”.
[710] Third, where the issue is the effect of conduct on a class of persons (rather than identified individuals to whom a particular misrepresentation has been made or particular conduct directed), the effect of the conduct or representations upon ordinary or reasonable members of that class must be considered (Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45; 169 ALR 677; 46 IPR 481; [2000] HCA 12 (Campomar) at [102] and [103]). This hypothetical construct avoids using the very ignorant or the very knowledgeable to assess effect or likely effect; it also avoids using those credited with habitual caution or exceptional carelessness; it also avoids considering the assumptions of persons which are extreme or fanciful. I should note here that much the same standard is applied in a case of passing off in assessing whether a representation of the relevant kind was made and its likely effect on the potential purchaser.
[711] Fourth, the objective characteristics that one attributes to ordinary or reasonable members of the relevant class may differ depending on the medium for communication being considered. There is scope for diversity of response both within the same medium and across different media.
[712] Fifth, for the purposes of s 18, one must identify the relevant conduct and then consider whether that conduct, considered as a whole and in context, is misleading or deceptive or likely to mislead or deceive. Such conduct is not to be pigeon-holed into the framework or language of representation (cf the language of s 29).
[713]Sixth, conduct is misleading or deceptive or likely to mislead or deceive if it has the tendency to lead into error. But conduct causing confusion or wonderment is not necessarily co-extensive with misleading or deceptive conduct. Mere confusion or wonderment will not establish misleading or deceptive conduct. Further, there may be evidence of initial confusion, but where such confusion was transient and did not result in any person seeking to commence negotiations or invite approaches, such a temporary and commercially irrelevant error would fall short of amounting to misleading or deceptive conduct.
[714] Seventh, for the purposes of s 18, the words “likely to mislead or deceive” demonstrate that it is not necessary to show actual deception. Relatedly, it is not necessary to adduce evidence from persons to show that they were actually misled or deceived.
[715] Eighth, there must be a sufficient nexus between the impugned conduct or apprehended conduct and the customer’s misconception or deception. Subject to one qualification, the error or misconception must result from the relevant respondent’s conduct and not from other circumstances for which that respondent was not responsible. But conduct that exploits or feeds into and thereby reinforces the pre-existing mistaken views of members of the relevant class may be misleading or deceptive or likely to mislead or deceive.
[716] Ninth, conduct that is merely transitory or ephemeral where any likely misleading impression is likely to be readily or quickly dispelled or corrected does not constitute conduct that would infringe s 18.
[717] Tenth, in determining whether a contravention of s 18 has occurred, the reactions of the hypothetical individual within the class are considered. Under the Campomar test, the hypothetical individual is a reasonable or ordinary member of the class.
To expand upon Beach J’s summary, conduct which induces temporary or commercially irrelevant error, although persuasive, is not sufficient to enliven s 18 of the ACL or constitute passing off: SAP Australia Pty at [51] (per French, Heerey and Lindgren JJ); Knight v Beyond Properties Pty Ltd (2007) 74 IPR 232 at [58] (per French, Tamberlin and Rares JJ). Further, there is a difference between a customer who is “momentarily confused” and a customer who is “misled or deceived in a material sense”: Brick Lane Brewing Co Pty Ltd v Torquay Beverage Co Pty Ltd (2023) 170 IPR 195 at [112] (per Stewart J).
As Besanko J observed in Mitolo at [360]:
the question of whether conduct is misleading or deceptive is a question of fact; it is an objective question and one which is to be considered in the light of all the surrounding facts and circumstances. Conduct is misleading or deceptive if it induces error or is capable of inducing error: Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592; 212 ALR 357; [2004] HCA 60 at [109]–[111] per McHugh J; Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357; 270 ALR 204; [2010] HCA 31.
In relation to new market entrants, Murphy J in Telstra observed at [539]–[540]:
[539] Experience teaches that it is far from unusual for a new entrant to a market to attempt through packaging, use of colour, or use of other trade indicia to attract some of the familiarity that consumers have in the products of the market leader. As Mr Weissenberg said:
The first brand that comes into the marketplace and establishes the category sets the tonality for everyone else and, you know, they follow in terms of packaging, in terms of colour use, etc. That is quite a common thing.
But that is not the same thing as setting out to deceive.
[540] It is also necessary to keep in mind that it is no part of the court’s task to be critical of the respondents for taking an element of Telstra’s get up unless they have engaged in misleading or deceptive conduct or passing off: Dr Martens Australia Pty Ltd v Figgins Holdings Pty Ltd (1999) 44 IPR 281; [1999] FCA 461 at [306]–[307] per Goldberg J. The authorities are replete with examples where traders “sail close to the wind” by copying elements of a competitor’s get up, but maintain sufficient differences such that misleading or deceptive conduct or passing off cannot be made out. The question is whether the trader goes too far and steps over the line into misrepresentation.
Finally, an intention to deceive is highly relevant to whether conduct is likely to deceive potential consumers. As Dixon and McTiernan JJ said in an already quoted and oft cited passage in Australian Woollen Mills at 657: “when a dishonest trader fashions and implements a weapon for the purpose of misleading potential customers it at least provides a reliable and expert opinion on the question whether what is done is in fact likely to deceive”. However, an intention to deceive is not determinative and must be weighed against other evidence as, after all, an intention to deceive may nevertheless fail in its purpose: Telstra at [553]–[555] (per Murphy J).
8.3 Relevant class of consumer
Both parties accepted that the relevant class of consumer is the general public. The effect of the conduct on the ordinary and reasonable member of the general public is what must be considered. The ordinary and reasonable consumer is a hypothetical construct to whom the court attributes characteristics and knowledge in order to characterise the impugned conduct. This hypothetical construct avoids using the very ignorant, the very knowledgeable, the very cautious or the exceptionally careless members of the class to assess the effect or likely effect of the conduct: Self Care at [83] (per Kiefel CJ, Gageler, Gordon, Edelman and Gleeson JJ). The court must put itself in the position of the ordinary and reasonable consumer.
The reasonable consumer in this case is a member of the public looking to browse and/or buy soft homewares products. The attributes and knowledge of the reasonable consumer include:
(a)a familiarity with the main speciality retailers of soft homewares products in Australia — BBNT, Adairs and Sheridan;
(b)an awareness that department stores such as Myer, Kmart, Harris Scarfe and David Jones also sell soft homewares; and
(c)knowledge that major brands may have sub-brands.
I consider that the reasonable consumer is more engaged in their surroundings and what shop they enter than the purely window shopper type browser. I discount from the reasonable consumer the purely window shopper because I consider such a person to have little to no interest in which shop they enter, as they are looking to while away the time and the exercise is more an entertainment experience than a consumer one.
8.4 The parties’ submissions
BBNT claims that GRBA has, by its conduct, represented that the House B&B brand and the House B&B stores opened by GRBA are associated with, approved by or licensed by BBNT.
The conduct of which BBNT claims gives rise to the representation commenced with GRBA’s use of House B&B as the name of its new soft homewares store launched at Doncaster shopping centre on 14 May 2014, and extends to, among other uses, the use of the House B&B mark on the external signage over the entrance to all of its retail stores and the use of the House B&B mark on the House website.
BBNT contends that the similar branding can properly be characterised as conveying that the two businesses have formed an alliance or arrangement to sell similar or related products; or that a co-branding relationship existed; or that there was a mis-association in the nature of consumers believing that the businesses were one and the same, or part of the same corporate group.
BBNT contends that the impact of GRBA adopting the House B&B logo on its first store is to be assessed against the reputation of BBNT, which at the relevant time operated around 167 stores.
As a preliminary matter, GRBA submits the evidence at trial does not establish that BBNT enjoys any independent reputation or goodwill in the BBNT Get-up (defined above at [37]) or the ordinary English words “bed” and “bath” when divorced from the BBNT marks. GRBA also submits that the House B&B mark and House B&B stores are readily distinguishable from the BBNT brand and BBNT stores.
GRBA contends that the words “bed” and “bath” are descriptive and relies on the comments of Stephen J in Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216 at 229–30 to submit that a court will not grant a de facto monopoly in the descriptive words “BED & BATH”. In Hornsby, the Sydney Building Information Centre Ltd claimed that the use of the name Hornsby Building Information Centre Pty Ltd amounted to misleading and deceptive conduct. Both parties provided building information services. Stephen J described the names of both parties (at 228) as consisting of “three descriptive words, prefixed by a word of locality”, and observed at 229:
There is a price to be paid for the advantages flowing from the possession of an eloquently descriptive trade name. Because it is descriptive it is equally applicable to any business of a like kind, its very descriptiveness ensures that it is not distinctive of any particular business and hence its application to other like businesses will not ordinarily mislead the public.
Despite each case being reliant on its own facts, including surrounding contextual circumstances, GRBA relied upon several further cases based on claims of descriptive trading or product names that were not found to mislead or deceive consumers for the purposes of s 18 of the ACL or its predecessor in s 52 of the Trade Practices Act.
As I observed above, I consider the words “bed” and “bath” in both marks in this case to be more allusive than purely descriptive. Neither mark is directly or “eloquently” descriptive in the manner of the corporate names in Hornsby or any of the other cases relied upon by GRBA.
8.5 Consideration
8.5.1The conduct
The relevant conduct is GRBA’s use of House B&B as the name of its new soft homewares stores, first launched at Doncaster shopping centre on 14 May 2021, including the use of the House B&B mark on the external signage over the entrance to its store and the use of the House B&B mark on the House website. According to BBNT, at the time of the hearing, there were at least 17 House B&B stores displaying signage which improperly indicates a connection with BBNT.
BBNT also contends that GRBA wrongfully used the House B&B name on its website, store receipts, social media, shopping centre directories, advertising and promotional materials including store opening flyers, gift cards and employee name badges.
8.5.2Trade and commerce
GRBA’s use of House B&B as the name of its new soft homewares store and its use of the House B&B mark on external shop signage on its retail stores, and all of the other relevant conduct out set out above, is clearly use of the House B&B mark in trade and commerce.
8.5.3Whether conduct misleading or deceptive or likely to mislead or deceive
On 14 May 2021, a new soft homewares store opened in the homewares precinct of Doncaster shopping centre, up one floor from the existing BBNT store and across from Adairs. Externally, it was much like other soft homewares stores: the store had large glass windows through which made up beds could be seen. Across the entrance to the store was the House B&B sign:
The question to determine is what meaning does GRBA’s use of the House B&B mark on a shopfront at the launch of the House B&B store in Doncaster on 14 May 2021, assessed in all the context (both broad and immediate), convey to the reasonable consumer as I have described them above?
The relevant broader context in which the conduct is to be judged includes the following (as at May 2021):
(a)BBNT had acquired an extensive reputation in the BBNT marks in Australia which had been accumulated over 40 years of use in the soft homewares market.
(b)The BBNT mark, despite containing ordinary English words, had become factually distinctive of BBNT as a result of over 40 years of use in Australia.
(c)BBNT had around 167 stores in Australia.
(d)The BBNT stores commonly had large front windows through which could be seen one or two made up beds in “Hamptons style” and frosted glass window decals with the BBNT mark. This style was similar to stores of other soft homewares retailers such as Adairs.
(e)Soft homewares retailers are often co-located in close proximity in shopping centres.
(f)GRBA had, over 40 years, acquired an extensive reputation in the brand House and its hard homewares stores in Australia.
(g)House stores had a particular “discount” look, unlike the style of the soft homewares retailers (described above) and sold kitchenware products.
(h)GRBA had around 140 House stores in Australia.
(i)No retailers in Australia other than BBNT used the words “bed” and “bath” in their store name or external signage. BBNT therefore has had over 40 years of “unique” use.
(j)Soft homewares retailers use “bed” and “bath” as category descriptors inside their retail stores (as opposed to on external signage), particularly department stores.
(k)Soft homewares products range in price from a few dollars (face washer or coaster) to a few hundred dollars (quilt covers).
The relevant immediate context includes the prominent use of “House” in the House B&B mark and the use of that mark on a soft homewares style shopfront. Also relevant is the appearance of House B&B stores. They are different to the typical House store with which consumers are familiar, with its cluttered appearance and discount signage. House B&B stores adopt the “Hamptons style” look of the other soft homeware retailers. The supposed differentiators pointed to by GRBA — the portrait orientation of the sheet sets and the presence of a linen press — are not readily observable to the customer outside the store.
It is also highly relevant that when it adopted the House B&B mark, GRBA was aware of the existence of BBNT and its reputation in the soft homewares sector, as both had been operating in the broader homewares sector for around 40 years. When combined with a surprising lack of legal advice and the fierce determination not to change the name of the store when the prospect of confusion was first brought to GRBA’s attention, GRBA’s attitude to the possibility of confusion of House B&B with BBNT can only be described as one of wilful blindness. Although GRBA’s wilful blindness may not amount to an intention to deceive consumers, it provides a similarly “reliable and expert opinion on the question of whether [GRBA’s conduct] is in fact likely to deceive”: see Australian Woollen Mills at 657 (per Dixon and McTiernan JJ).
In Sydneywide DistributorsPty Ltd v Red Bull Australia Pty Ltd (2002) 55 IPR 354, Weinberg and Dowsett JJ (Branson J agreeing) observed at [117] that:
where a trader, having knowledge of a particular market, borrows aspects of a competitor’s get-up, it is a reasonable inference that he or she believes that there will be a market benefit in so doing. Often, the obvious benefit will be the attraction of custom which would otherwise have gone to the competitor. It is an available inference from those propositions that the trader, with knowledge of the market, considered that such borrowing was “fitted for the purpose and therefore likely to deceive or confuse”. Of course, the trader may explain his or her conduct in such a way as to undermine the availability of that inference.
(Emphasis added.)
I consider that such an inference of the kind described in Sydneywide at [117] is available to be drawn on the basis of the evidence in this case. GRBA has tried to explain its conduct to undermine that inference by saying that the “BED & BATH” part of the name was chosen purely because those words are appropriate category descriptors. However, if I reject the evidence of Mr Lew and Ms McGann as truthful or plausible, as I do for the reasons given above, then GRBA has no proper explanation to undermine that inference.
As discussed above at [175], Mr Lew selected the name “House BED & BATH” from the other two options presented to him by Ms McGann (“House BATH AND BED” and “House BEDWORKS”) because, although all three options employed category descriptions of the products sold in store, “BED & BATH” “rolls off the tongue” more easily than the other two names. The suggestion that “BED & BATH” “rolls off the tongue” is in all likelihood the result of the 40 years of use of those words in Australia by BBNT as part of its name. It is not the natural order for reference to those words. That is, the usual sequence is to have a bath before you go to bed, especially for small children. Notwithstanding that BBNT does not have an independent reputation in the words “BED BATH” alone, BBNT’s longstanding reputation in its name which included the words “bed” and “bath” (and in that order) is undoubtedly part of the reason that those words appealed to GRBA, which could leverage off that well-known pairing of words in entering a new market for the first time.
The similarities in store get-up (albeit typical for a soft homewares store) further reinforce the association that consumers may draw between House B&B and BBNT. The competing House B&B store and BBNT store at Chadstone, which are located in close proximity to one another, but not side by side, appear as follows:
The reasonable consumer would not see the words “bed” and “bath” in the House B&B store name primarily as category descriptors. Consumers are familiar with seeing those words used as category descriptors inside stores (including large department stores), not on the exterior of stores. As at mid May 2021, the reasonable consumer was not familiar with seeing “bed” and “bath” on a store front other than over the entrance to a BBNT store.
The reasonable consumer coming across a House B&B store for the first time would recognise that it is not a House store of the kind that they are used to seeing. Although the “House” logo is displayed prominently, it does not have the cluttered “discount” look of a traditional House store but rather has the appearance of the typical soft homewares stores with which the consumer is aware, such as BBNT or Adairs.
I consider that when the conduct is viewed as a whole, in the immediate and broader contexts identified above, the reasonable consumer coming across a House B&B store for the first time would question whether there was some kind of association between the two well-known brands; that perhaps House had merged with BBNT or taken it over.
Whilst the effect of the conduct may dissipate over time as consumers learn that there is no association between House B&B and BBNT, and that House B&B is actually a House sub-brand, there are likely to be consumers who have been enticed into the House B&B store in the belief that it has some association with BBNT. I consider that any confusion that may arise is more than “merely transitory or ephemeral” or “likely to be readily or quickly dispelled” (see State Street at [713] and [716] (per Beach J)) but rather may have, on occasion, led a consumer to purchase products from House B&B in the mistaken belief that it was a BBNT, or BBNT-related, store.
I am fortified in my conclusion that the reasonable consumer may be “caused to wonder” (see Self Care at [70]–[71]) whether there is an association between House B&B and BBNT by the existence of the evidence that consumers actually did question whether there was such an association. That evidence included the following examples:
(a)Following the distribution of flyers advertising the opening of the House B&B store in Chadstone on 29 October 2021, Ms Erdossy (an employee at BBNT Chadstone) said that she served about five or six customers that day who referred to, or sought to rely upon, the leaflet. Four of those customers told Ms Erdossy that they thought BBNT and House B&B were part of the same group, or asked if they were.
(b)Ms van der Plight gave evidence of a telephone conversation on 11 June 2021 with a caller who asked if BBNT were “BED & BATH” and when told “we are BED BATH N’ TABLE and they are House BED & BATH”, the caller said something like “that's very confusing” and “but you're the same company”.
(c)Ms van der Plight also gave evidence of a telephone conversation with a lady wanting to place an order who said she was out the front of the store. However, the lady was, in fact, outside a House B&B store. The lady asked Ms van der Plight why BBNT and House B&B have such similar names if they were not the same company.
(d)Ms Tabe gave evidence that on 2 November 2021, a customer called and asked when the Bessemer products are going off sale. When she was told that BBNT did not sell Bessemer products, she asked if they were House B&B and then said, “Are you related to House BED & BATH?”.
Although I give the alleged confusion evidence relied upon by BBNT very little weight on its own, these examples of confusion strengthen the inference I have independently reached that GRBA’s conduct was misleading or deceptive: see SGIC at 529 (French J); Homart at [32] (per Burley J).
Accordingly, I am satisfied that by adopting the name House B&B and launching the first House B&B store in May 2021 at Doncaster shopping centre, GRBA engaged in misleading and deceptive conduct contrary to s 18(1) of the ACL and made false and misleading representations that House B&B stores were somehow associated or affiliated with BBNT contrary to s 29(1)(g) and (h) of the ACL.
9. PASSING OFF
BBNT submits that findings can be made as to passing off based on the same facts as identified in respect of the ACL claim. It contends that by virtue of that conduct, BBNT has likely suffered damage to its reputation and diversion of its business (the precise amount which can be later quantified in a quantum hearing).
GRBA contends that BBNT's passing off claim fails for the same reasons that BBNT’s misleading and deceptive conduct claim fails, and relies on the same line of authorities referred to at [502] and the comments of Stephen J in Hornsby to support its argument.
9.1 Principles
The elements for the tort of passing off are well established. The tort of passing off involves “three core concepts: reputation, misrepresentation and damage”: Stone and Wood Group Pty Ltd v Intellectual Property Development Corp Pty Ltd (2018) 129 IPR 238 at [82] (per Allsop CJ, Nicholas and Katzmann JJ) citing ConAgra Inc v McCain Foods (Aust) Pty Ltd (1992) 23 IPR 193 at 246–7 (per Gummow J). As the Full Court said in Stone and Wood at [83], the tort “protects the right of property in business, goodwill or reputation”: see also Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd (2007) 72 IPR 261 at [98] (per Black CJ, Emmett and Middleton JJ); ConAgra at 231 (per Lockhart J).
Beach J summarised the elements of the tort of passing off in State Street at [748]:
(a) first, the existence of a reputation, at the time of the respondent’s impugned conduct, in the mind of the relevant purchasing class for the applicant’s goods or services;
(b)second, a misrepresentation by the respondent, whether intentional or inadvertent, that its goods or services are those of the applicant; and
(c) third, that the applicant has suffered or is likely to suffer damage.
The tort of passing off and misleading and deceptive conduct are closely related and are often considered together as overlapping claims. However, as the Full Court explained in Cadbury at [98]:
the causes of action have distinct origins and the purposes and interests that both bodies of law primarily protect are contrasting. Passing off protects a right of property in business or goodwill whereas Part V is concerned with consumer protection. Part V is not restricted by common law principles relating to passing off and provides wider protection than passing off.
O’Bryan J in Urban Alley, citing Flexopack and Hornsby, made a similar point at [233]:
While ss 18 and 29 have a broader operation than passing off, as a practical matter, where the facts of a case are said to amount to passing off, the principles applicable to that cause of action offer guidance in relation to the application of ss 18 and 29 …
It is well established that, although both claims generally run together, an ACL claim has broader application and is generally easier to establish than a passing off claim. The key distinction being that, unlike in passing off, reputation is not an element of the statutory cause of action under the ACL, even though it may be relevant: see In-N-Out Burgers, Inc v Hashtag Burgers Pty Ltd (2020) 150 IPR 73 at [182] (per Katzmann J); Cadbury at [99] (per Black CJ, Emmett and Middleton JJ). Of course, in a case like this where the reputation of the applicant is not an issue, that distinction is irrelevant.
9.2 Consideration
Both parties accepted that where the Court is satisfied that the conduct of GRBA is misleading or deceptive (or likely to be so), the same conclusion follows in respect of passing off. That acknowledgment is consistent with the authorities discussed above in a case such as this where the reputation of the applicant is not in dispute. I am satisfied that the three elements of passing off have been established.
First, there was no dispute that BBNT has acquired a substantial reputation in the BBNT marks and BBNT name. As Mr Lew himself acknowledged, BBNT is a “very prominent and successful brand” and “very well established in the market”.
Second, given my conclusions above with respect to the ACL claim, I am satisfied that GRBA made a misrepresentation that House B&B is associated with BBNT.
Finally, once it is accepted that GRBA’s conduct has likely misled or deceived consumers into thinking that House B&B stores are operated by, or otherwise associated with, BBNT, there is at least a likelihood of damage to BBNT in the form of diversion of business by reason of the misrepresentation of trade association.
10. NEW ZEALAND CASE
Following the conclusion of the hearing, I made orders permitting the parties to provide short supplementary submissions on the relevance of Brands Ltd v Bed Bath ‘N’ Table Pty Ltd (2023) 174 IPR 261. This recent decision of the New Zealand High Court concerned an application by Brands Ltd, who trades as BED BATH & BEYOND, which alleged that BBNT had engaged in trade mark infringement, passing off and breach of the Fair Trading Act 1986 (NZ) by its use of BED BATH ‘N TABLE. I do not consider that this case is relevant to the current matter because, among other things, it concerned different facts, evidence, and statutory contexts. As such, it is unnecessary to further address the case or those submissions of the parties.
11. CONCLUSION
BBNT was ultimately only partially successful. For the reasons given above, I am not satisfied that GRBA engaged in trade mark infringement.
However, a different conclusion follows with respect to misleading and deceptive conduct and passing off. It is the reputation of BBNT, which could not be considered in assessing trade mark infringement, that is crucial in leading to a conclusion that GRBA engaged in misleading and deceptive conduct in circumstances where the House B&B mark was not found to be deceptively similar to the BBNT mark. Further, although GRBA may have not set out with an intention to deceive or confuse consumers, it was wilfully blind as to the prospect of confusion arising from the adoption of a name that appropriated two words from one of its largest competitors. GRBA was simply unable to undermine the obvious inference that was open that GRBA borrowed the words “bed” and “bath” from BBNT’s name in order to attract customers from BBNT, and that such borrowing was “fitted for [that] purpose and therefore likely to deceive or confuse” consumers: Australian Woollen Mills at 657 (per Dixon and McTiernan JJ); Sydneywide at [117] (per Weinberg and Dowsett JJ).
BBNT sought to be heard separately on the issue of relief. Accordingly, I will make orders for the provision of a further hearing on relief if the parties cannot agree on orders to reflect these reasons. The issue of costs of the proceeding should also be dealt with at that stage if no agreement can be reached.
12. FINAL NOTE
Before I finish, I note that we lost three much loved fathers/fathers-in-law/grandfathers during the trial. I again extend my condolences to the lawyers and appreciate the resilience of the legal teams that enabled the evidentiary part of the trial to continue and be completed in December 2022. It was for this reason that closing submissions were adjourned until late March 2023.
I certify that the preceding five hundred and thirty-eight (538) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Rofe. Associate:
Dated: 14 December 2023
7
23
5