Beer Cartel Pty Ltd v Pirate Cartel Distribution Pty Ltd

[2018] ATMO 71

TRADE MARKS ACT 1995

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

Re:Opposition by Beer Cartel Pty Ltd to registration of trade mark application 1784130 (35) – PIRATE CARTEL - filed in the name of Pirate Cartel Distribution Pty Ltd

Delegate:	Nicholas Smith Decision on the Written Record
Decision:	2018 ATMO 71 Trade Marks Act 1995 (Cth) - Section 52 opposition: ss 43, 44, 58A, 60 and 62A considered – none established – trade mark to proceed to registration

Background

1. This is an opposition brought by Beer Cartel Pty Ltd (‘Opponent’) pursuant to s 52 of the Trade Marks Act 1995 (Cth) (‘Act’) to the registration of the trade mark which is the subject of the application detailed below in the name of Pirate Cartel Distribution Pty Ltd (‘Applicant’): 

Application Number:	1784130
Filing Date:	21 July 2016
Services:	Class 35: Distribution of goods (not being transport services) (agent, wholesale, representative services, by any means); Wholesaling of goods (by any means) (‘Applicant’s Services’)
Trade Mark:	PIRATE CARTEL	(‘Trade Mark’)

2. Following the advertisement on 15 December 2016 in the Australian Official Journal of Trade Marks of the application’s acceptance for possible registration, the Opponent filed a Notice of Intention to Oppose on 1 February 2016.  The Opponent then filed a Statement of Grounds and Particulars (‘SGP’) on 1 March 2016, later amended by letter on 12 April 2016. The SGP (after the amendment) raised grounds of opposition under ss 43, 44, 58A, 60 and 62A of the Act. The Applicant filed a Notice of Intention to Defend on 25 May 2017.

Evidence and Submissions

3. Neither party filed any evidence in this matter.

4. Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing or to file written submissions.  The Applicant filed written submissions on 8 February 2018 (‘Applicant’s Submissions’).  By letter issuing from IP Australia on 2 March 2018 the parties were notified that as neither party had requested a hearing the matter would be given to a delegate of the Registrar for a decision based on the written record.  The letter indicated that the parties had one month from the date of the letter to file any (in the Applicant’s case additional) written submissions they wished to reply upon.  Neither party filed any submissions in response to the 2 March letter.

5. I am a delegate of the Registrar of Trade Marks and I am to decide the opposition as required by s 55 of the Act which provides that, unless the proceedings are discontinued, dismissed, or have lapsed under s 54A the Registrar must, at the end, decide on the basis of the written record, comprised of the materials mentioned in the preceding paragraphs:

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

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

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

The Opponent

6. The Opponent has provided no evidence and, therefore, I am unable to provide any information about the Opponent other than what is set out in the Register. 

7. The Opponent is the registered owner of the trade mark set out below (‘Opponent’s Trade Mark’). 

Number	Trade Mark	Priority Date	Goods and Services
1336808	BEER CARTEL	16 Dec 2009	Class 25: Beer, ales and lagers Class 33: Alcoholic beverages (except beer) Class 35: Wholesale and retail of beer, ales, lagers and other alcoholic beverages; wholesale and retail of gift vouchers for beer, ales, lagers and other alcoholic beverages, wholesale and retail of glassware and books relating to beer, wholesale and retail of beer mugs and glasses Class 41: Beer appreciation events; beer tasting events

The Applicant

8. The Applicant has provided no evidence and, therefore, I am unable to provide any information about the Applicant.

Grounds of Opposition, Onus and Standard of Proof

9. As indicated above in the SGP the Opponent nominated grounds of opposition under ss 43, 44, 58A, 60 and 62A of the Act. To successfully oppose the application the Opponent needs to establish at least one of those grounds.

10.      The onus of proof in an opposition rests upon the Opponent.[1]  The relevant standard of proof is the ordinary civil standard based on the balance of probabilities.[2] The date at which the rights of the parties are to be determined is 21 July 2016, being the filing date of the application in Australia (except in circumstances, not present here in which a different priority date is provided for in the Act).[3]

[1] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58, [32].

[2] Following Pfizer Products Inc v Karam (2006) 70 IPR 599, [6]-[26], and Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133].

[3] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 595, see also s 29(1) Trade Marks Act 1995 (Cth).

11. With the exception of ss 43 and 44, as the Opponent has filed no evidence and provided no submissions I have no hesitation deciding that the Opponent has not discharged the onus on it and has consequently not to any extent established any of the remaining grounds of opposition nominated in the SGP (namely s 58A, 60 and 62A of the Act). The mere filing of the Notice of Opposition without any supporting evidence or submissions does not serve to place the onus on the Applicant to defend its application.[4]

[4] Medley Distilling Co v Croakers Gully Australia (2000) 53 IPR 430, 433.

Discussion

Section 44

12. The relevant provisions of the Act with respect to the ground pursuant to s 44 are reproduced below:

Section 44 - Identical etc. trade marks

(1)…

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

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

(i)a trade mark registered by another person in respect of similar     services or closely related goods; or

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

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

Note 1: For deceptively similar see section 10.
Note 2: For similar services see subsection 14(2).
Note 3: For priority date see section 12.

Note 4: The regulations may provide that an application must also be rejected if the trade mark is substantially identical with, or deceptively similar to, a protected international trade mark or a trade mark for which there is a request to extend international registration to Australia: see Part 17A.

Section 10 - Definition of deceptively similar

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

13. To successfully oppose the application pursuant to s 44 of the Act the Opponent must establish the requirements of s 44(2), i.e. that at least one of the trade marks upon which it relies:

·    has a priority date which is earlier than that of the Trade Mark (‘the first requirement’);

·    is substantially identical with or deceptively similar to the Trade Mark (‘the second requirement’); and

·    is in respect of similar services, or goods which are closely related to, the Applicant’s Services (‘the third requirement’).

14. In the event that each of these requirements are satisfied by the Opponent it may be possible for the Registrar to accept the application if the Registrar is satisfied that there has been honest concurrent use, other circumstances or that the Applicant has continuously used the trade mark beginning before the priority date of the Opponent’s relied upon mark, pursuant to ss 44(3) and s44(4) of the Act

15.      The Opponent has particularised the ground of opposition in the SGP by reference to the Opponent’s Trade Mark.  I find that the Opponent’s Trade Mark has an earlier priority date than the Trade Mark.  I also find that the Applicant’s Services encompass, and hence are similar to, the services in Class 35 for which the Opponent’s Trade Mark is registered.  The first and third requirements are thus satisfied. 

Substantially identical or deceptively similar

16.     I will now consider whether the Trade Mark is substantially identical to the Opponent’s Trade Mark.  When considering ‘substantial identity’ in Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd Windeyer J said:

In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison.[5]

[5] (1963) 109 CLR 407, [12].

17.      The Trade Mark and the Opponent’s Trade Mark are set out below:

PIRATE CARTEL

BEER CARTEL

18.      On a side by side comparison there is a clear difference between the respective trade marks, being the replacement of the word ‘pirate’ (in the Trade Mark) with the word ‘beer’ (in the Opponent’s Trade Mark).  The words ‘pirate’ and ‘beer’ are essential features of the respective marks.  In particular the word ‘pirate’ is not a descriptive word to be discounted in the comparison.  This difference between the respective trade marks is sufficient for me to conclude that the respective trade marks are not substantially identical.  I move then to consider whether the Trade Mark and Opponent’s Trade Mark are deceptively similar.

19.      The principal authority for guidance in determining whether trade marks are deceptively similar also comes from the judgment of Windeyer J in Shell Co (Aust) Ltd v Esso Standard Oil (Aust) Ltd:

On the question of deceptive similarity, a different comparison must be made from that which is necessary when substantial identity is in question. The marks are not now to be looked at side by side. The issue is not abstract similarity, but deceptive similarity.

Therefore the comparison is the familiar one of trade mark law. It is between, on the one hand, the impression based on recollection of the plaintiff’s mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant’s [trade mark].[6]

[6] Ibid [13].

20.      Jacobson J in Millennium & Copthorne International Limited v Kingsgate Hotel Group Pty Ltd summarised the principles of deceptive similarity with reference to the authorities as follows:

Without seeking to reformulate the various statements of principle stated in the Full Court authorities, it is sufficient for present purposes to identify the critical elements which seem to me to inform the issue of deceptive similarity in the present case. There are nine elements.

First, the judgment of likelihood of deception is a practical one. It requires an assessment of the effect of the challenged mark on the minds of potential customers: Woolworths[7] at [49]; Australian Woollen Mills[8] at 658.

Second, the question of deceptive similarity is not to be decided by a side-by-side comparison. It is to be determined by a comparison of the impression based on recollection of the opponent’s mark that persons of ordinary intelligence and memory would have, and the impression that those persons would get from the opposed trade mark: Crazy Ron’s[9] at [73]; Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd [1963] HCA 66; (1963) 109 CLR 407 at 415 per Windeyer J.

Third, allowance must be made for imperfect recollection: Crazy Ron’s at [74].

Fourth, the effect of the spoken description must be considered: Woolworths at [49]; Crazy Ron’s at [75]; Australian Woollen Mills at 658.

Fifth, it is necessary to show a real tangible danger of deception or confusion: Woolworths at [43] and [50]; Crazy Ron’s at [76]; Southern Cross Refrigerating[10] at 594 – 595.

Sixth, a trade mark is likely to ‘cause confusion’ if the result of its use will be that a number of persons are ‘caused to wonder’ whether the two products come from the same source: Woolworths at [50]; Southern Cross Refrigerating Co at 595. This test sets a lower threshold than that which is required to establish that conduct is likely to mislead or deceive under s 18 of Schedule 2 of the Competition and Consumer Act 2010 (Cth): see McWilliam's Wines Pty Ltd v McDonald's System of Australia Pty Ltd [1980] FCA 159; (1980) 33 ALR 394 at 398 per Smithers J.

Seventh, all surrounding circumstances must be taken into consideration. The circumstances include those in which the marks will be used, and in which the goods or services will be bought and sold, as well as the character of the probable acquirers of the goods and services: Woolworths at [50]; Crazy Ron’s at [86] – [89]; Southern Cross Refrigerating at 595.

Eighth, the question of whether there is a likelihood of confusion is not to be answered by reference to the manner in which a party has used the mark, but by reference to what an applicant can do. That is to say, the use to which it can properly put the mark if registration is obtained: Woolworths at [50]; Berlei Hestia Industries Ltd v The Bali Company Inc [1973] HCA 43; (1973) 129 CLR 353 at 362 per Mason J.

Ninth, if a registered trade mark includes words which can be regarded as an ‘essential feature’ of the mark, another mark that incorporates those words may cause a tangible danger of deception or confusion by reason of consumers retaining an imperfect recollection of those words: Crazy Ron’s at [79]. However, care must be taken to not too readily characterise words in a composite trade mark as an ‘essential feature’ because to do so may effectively convert a composite mark into something different: Crazy Ron’s at [100].[11]

[7] Registrar of Trade Marks v Woolworths Ltd [1999] FCAFC 1020.

[8] Australian Woollen Mills Ltd v FS Walton & Co Ltd [1937] HCA 51; (1937) 58 CLR 641.

[9] Crazy Ron’s Communications Pty Ltd v Mobileworld Pty Ltd [2004] FCAFC 196; (2004) 209 ALR 1.

[10] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592.

[11] [2012] FCA 1022, [38]-[46].

21.      I do not find that the respective marks are deceptively similar.  While the marks share the word ‘cartel’, the replacement of the word ‘beer’ with the word ‘pirate’  in the Trade Mark results in a visual, aural and conceptual difference between it and the Opponent’s Trade Mark.  The word ‘pirate’ is not in any way descriptive of the Applicant’s Services and operates to clearly distinguish the Trade Mark and the Opponent’s Trade Mark.

22.      I find that as a result of the significant visual, aural and conceptual differences between the marks when considered as a whole, even allowing for imperfect recollection, it is unlikely that the use of the Trade Mark will deceive or cause confusion because of any similarity it has to the Opponent’s Trade Mark.

23. I find that the Opponent has failed to establish the ground of opposition under s 44.

Section 43

24. Section 43 of the Act is reproduced below[12]:

[12] In setting out the principles that apply with respect to s 43 of the Act the following two paragraphs are taken from Pink energy Beverages Pty Ltd v Mr. Pink Collections, LLC. [2016] ATMO 20 [13]-[14].

43 Trade mark likely to deceive or cause confusion

An application for the registration of a trade mark in respect of particular goods or services must be rejected if, because of some connotation that the trade mark or a sign contained in the trade mark has, the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion.

1. To establish a ground of opposition under s 43 of the Act, there must be an inherent connotation within the trade mark. As Gyles J in Pfizer Products Inc v Karam commented:

   ‘Connotation’ is a secondary meaning implied by the mark. The likelihood of deception or confusion must flow from the secondary meaning inherent in the mark itself. It is apparent that the underlying purpose of s 43 is a similar purpose to that lying behind ss 52, 53 and 55 of the Trade Practices Act 1974 (Cth). It is to prevent the public being deceived or confused as to the nature of the goods offered by reason of a secondary meaning connoted by the mark in question... [13]

   [13] [2006] FCA 1663; (2006) 70 IPR 599, [53].

   26.      In Winton Shire Council v Lomas Spender J said:

   Section 43 is directed to the mark itself. It is not concerned with any deception or confusion caused by the reputation in Australia of some other trade mark. That aspect of the matter is dealt with under s 60. [14]

   [14] [2002] FCA 288; (2002) 119 FCR 416; (2002) 56 IPR 72, [19].

2. The ground of opposition pursuant to s 43 of the Act was particularised in the SGP as follows:

   The use of the word “Cartel” by the applicant in its proposed trade mark, in circumstances where the opponent’s registered trade mark also contains this prominent term, the opponent operates in the same market and provides the same goods and services as the applicant and the applicant is not only aware of but has done business with the opponent, can only be considered to be used for an improper purpose.

   The use of the applicant’s proposed trade mark is likely to deceive or cause confusion because the common use of the term “Cartel” suggests and association between the two trade marks. Consumers are likely to be confused as to the origin of the goods or services provided by the applicant and will be unable to identify that the two trade marks belong to separate businesses.

   The opponent has an existing business which has been operating for over 9 years using the prominent term “Cartel” in its trade mark.  The customers of the opponent are highly likely to be confused by the use of the applicant’s trade mark and are likely to mistakenly believe that the applicant’s business is a new division or branch of the opponent.

   Because of this likely confusion, the opponent’s business is likely to be damaged and the applicant is likely to gain an unfair advantage by building a business based upon deceiving and confusing consumers.

3. As can be seen in the case law referred to above, the considerations set out in the SGP are not the appropriate considerations as the requisite confusion or deception must arise from a connotation within the Trade Mark itself rather than as a result of the reputation the Opponent may be able to demonstrate in its own trade mark.   

4. In the present matter, I am not satisfied that the element CARTEL in the trade mark has an inherent connotation such that its use is likely to deceive or cause confusion. I find that the ground of opposition under section 43 has not been established.

   Decision

   30.      The Opponent has failed to establish any of the grounds of opposition it nominated in the SGP.  Trade Mark application no. 1784130 may proceed to registration not less than one month from the date of this decision.  If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until either the appeal is withdrawn or discontinued.  Otherwise the disposition of the application should be in accordance with the Court’s order or direction.

   Costs

   31. The Applicant has sought an award of costs in its favour. I see no reason to depart from the general rule that costs follow the event. I accordingly award costs against the Opponent under section 221 of the Act in the relevant amounts under Schedule 8 of the Trade Marks Regulations 1995.

   Nicholas Smith
   Hearing Officer
   Oppositions and Hearings
   15 May 2018