Bendigo and Adelaide Bank Limited v Community First Credit Union Limited - [2017] ATMO 73

TRADE MARKS ACT 1995

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

Re:Opposition by Bendigo and Adelaide Bank Limited to registration of trade mark applications 1541594 (36) and 1541620 (36) – COMMUNITY FIRST MUTUAL BANK and COMMUNITY FIRST BANK – both in the name of Community First Credit Union Limited

Delegate:	Adrian Richards
Representation:	Opponent: Melissa Marcus of Counsel instructed by Natalie Williams of Switch Legal and Ryan Miller of the Opponent Applicant: Shauna Ross of Counsel instructed by FB Rice Pty Ltd
Decision:	2017 ATMO 73 Oppositions under section 52 of the Trade Marks Act 1995 (Cth) against two trade mark applications – grounds of opposition under sections 42(b), 44, 58A, 59 and 60 pressed – ground of opposition under section 44 established for both applications – prior use or honest concurrent use not established – trade mark applications refused

Background

This decision relates to two trade mark applications (together, ‘the Trade Marks’), filed by Community First Credit Union Limited (‘the Applicant’). Relevant details of the Trade Marks are reproduced below:
Application Number:           1541594
Filing Date:  1 March 2013 (‘the Relevant Date’)
Trade Mark:  COMMUNITY FIRST MUTUAL BANK
(‘the CFMB Trade Mark’)
Specification of Services:     Class 36: Card operated financial services; Financial services; Provision of information relating to financial services; Advice regarding lending services; Commercial lending; Corporate lending; Lending against securities; Lending on mortgage; Financial advice; Insurance services; Banking services in relation to the electronic transfer of funds; Personal banking services; Investment account services; Savings account services
Endorsement:  Provisions of subsection s44(4) and/or Reg 4.15A(5) applied
***
Application Number:           1541620
Filing Date:  1 March 2013
Trade Mark:  COMMUNITY FIRST BANK
(‘the CFB Trade Mark’)
Specification of Services:     Class 36: Card operated financial services; Financial services; Banking services in relation to the electronic transfer of funds; Personal banking services; Advice regarding lending services; Commercial lending; Lending against securities; Bank account services; Investment account services; Savings account services; Financial advice; Advice relating to insurance; Insurance services
Endorsement:  Provisions of subsection s44(4) and/or Reg 4.15A(5) applied
The Trade Marks were examined and both advertised as having been accepted for possible registration on 29 January 2015. Bendigo and Adelaide Bank Limited (‘the Opponent’) filed a pair of Notices of Intention to Oppose in relation to the Trade Marks on 27 March 2015, followed by twin Statements of Grounds and Particulars a month later. The Applicant filed Notices of Intention to Defend both oppositions to registration of the Trade Marks on 11 May 2015.
The parties availed themselves of the cooling-off period permitted by reg 5.16 of the Trade Marks Regulations 1995 (Cth) (‘the Regulations’). The cooling-off period was discontinued shortly after it was put in place. The parties subsequently filed their evidence in support, answer and reply in accordance with reg 5.14. The Opponent then asked to be heard in person on the oppositions, and requested that they be heard together.
The hearing took place on 29 March 2017 before me in my capacity as a delegate of the Registrar of Trade Marks. Appearing for the Applicant was Shauna Ross of Counsel, instructed by FB Rice Pty Ltd. Melissa Marcus of Counsel appeared for the Opponent, instructed by Natalie Williams of Switch Legal and Ryan Miller, Corporate Solicitor of the Opponent.

Evidence

The evidence filed in relation to both of the Trade Marks is identical, and so I have set it out below only once:
Evidence in support
Statutory Declaration of Barry Henwood, Director and Chairman of Valley Community Financial Services Limited, made 17 December 2015 with exhibits BH-1 and BH-2 and confidential annexure A (‘Henwood’)
Statutory Declaration of Gary Brian Sanford, Chief Executive Officer of Rye & District Community Financial Services Limited, made 15 December 2015 with exhibits GS-1 to GS-3 and confidential annexure A (‘Sanford’)
Statutory Declaration of Graham Booth, Director of Henty Community Financial Services Limited, made 16 December 2015 with exhibits GB-1 to GB-3 and confidential annexure A (‘Booth’)
Statutory Declaration of Sharron Jean Neunhoffer, Assistant Company Secretary at the Opponent, made 2 December 2015 with exhibits SN-1 and SN-2 (‘Neunhoffer’)
Statutory Declaration of John Stephen Worthington, Adjunct Professor of Marketing at Swinburne University Business School, made 19 December 2015 with annexures A to C (‘Worthington’)
Statutory Declaration of Robert Musgrove, Executive and Head of Group Strategy at the Opponent, made 14 December 2015 with exhibits RM-1 to RM-7 and confidential annexures A to H (‘Musgrove’)
Evidence in answer
Declaration of Lesley Burvill, Head of Risk at the Applicant, made 7 April 2016 with annexures A to C (‘Burvill’)
Evidence in reply
Statutory Declaration of Ryan James Miller, Corporate Solicitor at the Opponent, made 15 June 2015 with exhibits RM-1 to RM-8 (‘Miller’)
Musgrove provides a detailed account of the Opponent’s business including its revenue and marketing efforts, and furnishes many examples of marketing conducted by the Opponent and its franchises. Henwood, Sandford and Booth all provide similar accounts of the Opponent’s franchising arrangements, from the perspective of the leadership within a franchisee. These three Statutory Declarations also outline and provide examples of efforts to promote the Opponent along with their respective franchise, within their local area.
Neunhoffer annexes the results of two freedom of information requests in relation to the official files for the Trade Marks. This brings into evidence certain details of the prosecution of the Trade Marks through examination, including the evidence that was relied upon by the Applicant to obtain acceptance under s 44(4) of the Act, and to fend off a proposal to revoke their acceptance. The latter was the subject of a published decision of this office.[1] That evidence consists of two declarations by Michael O’Reilly, Head of Marketing at the Applicant, made on 22 December 2014 and 31 July 2015 respectively.
[1] Community First Credit Union [2015] ATMO 108.
Worthington is presented as expert evidence on branding and customer behaviour, specifically in relation to financial services. Annexure C consists of an expert report compiled by the declarant, which relates to ‘a number of oppositions involving [the Opponent]’. The report includes annexures SW-1 to SW-14.
Burvill provides an outline of the history of the prosecution of the Trade Marks through examination, and some information about the Applicant’s dealings with the Australian Prudential Regulation Authority (‘APRA’).
Miller primarily annexes the results of the declarant’s research into the business activities of the Applicant and public information released by APRA.

Grounds and Onus

Both Statements of Grounds and Particulars nominate grounds of opposition under ss 42(b), 44, 58A, 59 and 60. The Opponent bears the onus of establishing a ground of opposition on the balance of probabilities.[2] The rights of the parties are to be determined as at the Relevant Date.[3] To succeed, the Opponent need only establish one ground of opposition. Since I have found below that s 44 is established, it has not been necessary to consider any other grounds of opposition.

Discussion

[2] Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133]; Pfizer Products Inc. v Karam (2006) 219 FCR 585, 594 [26].

[3] Southern Cross Refrigerating v Toowoomba Foundry Pty Ltd (1953) 91 CLR 592, 595.

Section 44

Section 44(2) of the Act relevantly states:

44 Identical etc. trade marks
(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.

…

This provision applies where an earlier Australian trade mark application or registration, not in the name of the Applicant, claims similar services or closely related goods, and is substantially identical with, or deceptively similar to the applied for trade mark. It is subject to ss 44(3) and 44(4), which I have set out and discuss below under the heading ‘Prior or honest concurrent use’.
For consideration in relation to this ground of opposition, the Opponent has put forward its own registered trade mark, details of which are set out below:
Registration Number:         887023
Filing Date:  24 August 2001
Trade Mark:  COMMUNITY BANK
(‘the Opponent’s Trade Mark’)
Specification of Services:     Class 36: Financial services including banking services, capital investments, financial management and valuation, financing loans, mortgage banking and saving bank services; insurance services including accident insurance, fire insurance, health insurance, life insurance and insurance underwriting; hire-purchase financing services; lease financing services; financing for leasing and hire-purchase of machines and motor vehicles; leasing and rental of farms; leasing and rental of real estate; leasing and rental of houses and apartments; leasing and rental of office buildings; leasing and rental of flats; hire purchase finance services in relation to machines and vehicles
Endorsement:  Provisions of subsection 41(5) applied.
To deal firstly with two of the least controversial aspects of s 41(2), it is plain that the Opponent’s Trade Mark both has a priority date that is earlier than the Relevant Date and is not in the name of the Applicant.
The Opponent did not press at the hearing the assertions that appeared in the Statements of Grounds and Particulars that the Opponent’s Trade Mark is substantially identical to the Trade Marks. Given the additional words appearing in the Trade Marks, I find that the Opponent’s Trade Mark is not substantially identical to either of the Trade Marks. Before I move on to consider deceptive similarity, I will firstly address similarity of services, since the latter is a factor in deciding the former.
Section 14(2) of the Act provides the definition of ‘similar services’. Services are similar to other services if they are the same, or if they are ‘of the same description’. The Applicant conceded in its submissions that the services claimed by the Trade Marks and by the Opponent’s Trade Mark are ‘relevantly similar for the purposes of s 44(2)’, and I am satisfied that they are the same and/or of the same description.
Section 10 of the Act provides the definition of ‘deceptively similar’:
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.
Of the two critera mentioned in the above passage, ‘likely to deceive’ represents the higher bar, implying ‘the creation of an incorrect belief or mental impression’.[4] Relatively easier to trigger is ‘likely to…cause confusion’, which has been put in the following terms:
While a mere possibility of confusion is not enough – for there must be a real, tangible danger of its occurring – it is sufficient if the result of the user of the mark will be that a number of persons will be caused to wonder whether it might not be the case that the two products come from the same source.[5]
[4] Pioneer Hi-Bred Corn Co v Hy-line Chicks Pty Ltd [1979] RPC 410, 423.
[5] Southern Cross Refrigerating v Toowoomba Foundry Pty Ltd (1953) 91 CLR 592, 595 (citations omitted).
Deceptive similarity may be found ‘even if confusion is unlikely to persist up to the point of, and contribute to, inducing sale’.[6]
[6] Tivo Inc v Vivo International Corporation Pty Ltd [2012] FCA 252, [105].
The enquiry must take into account imperfect recollection of the relevant consumers of the services:
On the question of deceptive similarity a different comparison must be made from that which is necessary when substantial identity is in question. The marks are not now to be looked at side by side. The issue is not abstract similarity, but deceptive similarity. Therefore the comparison is the familiar one of trade mark law. It is between, on the one hand, the impression based on recollection of the plaintiff’s mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant’s television exhibitions. To quote Lord Radcliffe again: “The likelihood of confusion or deception in such cases is not disproved by placing the two marks side by side and demonstrating how small is the chance of error in any customer who places his order for goods with both the marks clearly before him.… It is more useful to observe that in most persons the eye is not an accurate recorder of visual detail, and that marks are remembered rather by general impressions or by some significant detail than by any photographic recollection of the whole”.[7]
[7] Shell Co of Australia Ltd v Esso Standard Oil (Aust) Ltd (1963) 109 CLR 407, 415.
In that regard, the idea that is conveyed by a trade mark is more likely to be recalled than its precise details.[8] The Opponent’s Trade Mark and both of the Trade Marks consist wholly of words, so these marks should be considered, as a whole, both visually and aurally.[9]
[8] Crazy Ron’s Communications Pty Limited v Mobileworld Communications Pty Limited (2004) 209 ALR 1, 17 [74].
[9] Re Pianotist Co’s Application (1906) 1A IPR 379.
To begin with this aural and visual comparison then, it is noteworthy that the marks are distinct in some ways, yet not in others. Both of the Trade Marks include the two words that appear in the Opponent’s Trade Mark, with the insertion in between of ‘first’ on the one hand and ‘first mutual’ on the other. The effect of these added words of course alters the visual and aural impression when read as a whole. The first word ‘community’ is, in all cases, identical. This first word also happens to have extra prominence since it is the longest both in letters and syllables in all of the marks concerned. The idea conveyed by the Opponent’s Trade Mark is of a local or communally owned financial institution, which is indistinct from the idea conveyed by either of the Trade Marks. The appearance in both of the Trade Marks of the word ‘first’ in its context does not, in my view, sufficiently alter that idea. While the placement of ‘first’ after ‘community’ might be read as a call to putting community before others, it is just as likely to be seen as descriptive in some way, or otherwise non-distinctive, and effectively go unremarked as a relevantly distinguishing feature. The word ‘mutual’ as it appears in the CFMB Mark is in my view even less likely to distinguish, since a mutual bank is a type of bank.
The notional consumer of the relevant services was the subject of some contention at the hearing. The Applicant sought to highlight that all of its customers are members/shareholders. However, I note that the specifications of services are not so limited, and I am required to consider the uses to which the Trade Marks might reasonably be put:
…the question whether there is a likelihood of confusion is to be answered, not by reference to the manner in which the respondent has used its mark in the past, but by reference to the use to which it can properly put the mark. The issue is whether that use would give rise to a real danger of confusion.[10]
[10] Berlei Hestia Industries Ltd v The Bali Company Inc (1973) 129 CLR 353, 362.
The Opponent submits that since ‘all people (of reasonable age) require banking and insurance to run their day to day lives, the kind of customers obtaining the respective services would range from the astute to the gullible’. In contrast, the Applicant submits that ‘great care would be taken by a consumer when choosing a provider [of the services], such that there does not exist a real tangible danger of deception or confusion occurring.’ On this point I favour the position of the Opponent, given both the reach of the customer base for financial/insurance services, and that consumers generally ‘are not to be credited with any high perception or habitual caution’.[11]
[11] Australian Woollen Mills Ltd v F S Walton & Co. Ltd (1937) 58 CLR 641, 658.
As highlighted by the Opponent, the class of people that are potential purchasers of financial and insurance services is very large indeed. This circumstance, combined with the above characterisation of the relevant consumer, lends weight to the likelihood of confusion occurring.
Given their aural and visual similarities, the similarity of idea conveyed by the Opponent’s Trade Mark and each of the Trade Marks, and the large number of potential consumers of these services in the Australian market, I consider that use of either of the Trade Marks would most likely give rise to a real danger of confusion.

Prior or honest concurrent use

In the event that I find the Trade Marks deceptively similar to the Opponent’s Trade Mark, the Applicant has put forward what it says is evidence of both honest and concurrent use, and earlier continuous use of the Trade Marks. Subsections 44(3) and 44(4) of the Act are set out below:
44 Identical etc. trade marks
(3)    If the Registrar in either case is satisfied:
(a)that there has been honest concurrent use of the 2 trade marks; or
(b)that, because of other circumstances, it is proper to do so;
the Registrar may accept the application for the registration of the applicant's trade mark subject to any conditions or limitations that the Registrar thinks fit to impose. If the applicant's trade mark has been used only in a particular area, the limitations may include that the use of the trade mark is to be restricted to that particular area.
Note:           For limitations see section 6.
(4)    If the Registrar in either case is satisfied that the applicant, or the applicant and the predecessor in title of the applicant, have continuously used the applicant's trade mark for a period:
(a)    beginning before the priority date for the registration of the other trade mark in respect of:
(i)the similar goods or closely related services; or

(ii)the similar services or closely related goods; and

(b) ending on the priority date for the registration of the applicant's trade mark;

the Registrar may not reject the application because of the existence of the other trade mark.
Note 1:An authorised use of the trade mark by a person is taken to be a use of the trade mark by the owner of the trade mark (see subsection 7(3)).
Note 2: For predecessor in title see section 6.

Note 3: For priority date see section 12.

In relation to these provisions, the Applicant relies upon its use of the following six trade marks, from around 1993 up to the Relevant Date:

COMMUNITY FIRST

COMMUNITY FIRST CREDIT UNION

(‘the Prior Use Marks’)

Plainly, none of the Prior Use Marks is the same as either of the Trade Marks. The Applicant submits that use of each of the Prior Use Marks is nevertheless use of the Trade Marks within s 7(1) of the Act, which I have set out below:
7 Use of trade mark
(1) If the Registrar or a prescribed court, having regard to the circumstances of a particular case, thinks fit, the Registrar or the court may decide that a person has used a trade mark if it is established that the person has used the trade mark with additions or alterations that do not substantially affect the identity of the trade mark.
Note: For prescribed court see section 190.
The mildest of these alterations is the omission of the word ‘bank’ from the first trade mark in the above list – COMMUNITY FIRST. At the other end of the scale is the omission of the words ‘mutual bank’ and the additions of ‘credit union limited’ and the tagline ‘you come first with community first’ from the fourth mark shown above.
What are plainly absent from any of the Prior Use Marks are the words ‘mutual’ and ‘bank’. The Applicant submits that the distinctive part of the Trade Marks is COMMUNITY FIRST, and that the words MUTUAL BANK or BANK respectively are merely descriptive of the claimed services.
The evidence of Mr Worthington is that in particular the word ‘bank’ conveys value to the consumer by providing a notion of security not afforded to other deposit taking institutions:
[C]onversion to a “Bank” and the addition of that word to a mutuals’ name can enhance its performance and substantially affect the identity of the institution and its brand.
…
[T]he term “Bank” is a significant one for marketing to consumers. The addition of the word “Bank” effectively creates a new brand in the eyes of consumers.
The significance of the word ‘bank’ in relation to financial services is amplified by the fact that its use is highly regulated in this country, and its misuse can result in criminal sanctions.[12]
[12] Banking Act 1959 (Cth) s 66.
Given all of this, I consider that even the mildest difference between the Trade Marks and the Prior Use Marks in evidence mentioned above – the omission of the word ‘bank’ from COMMUNITY FIRST – is enough to substantially affect the identity of the CFB Mark. It follows that the omission of the words ‘mutual bank’ from the COMMUNITY FIRST word mark also substantially affects the identity of the CFMB Mark. I am therefore not satisfied that the Applicant has led any examples of prior use or honest concurrent use of either of the Trade Marks.
The Opponent has established a ground of opposition under s 44(2), and the Applicant has not shown honest concurrent use under s 44(3), or prior use under s 44(4).

Decision

Section 55 of the Act relevantly provides:
55 Decision
(1) Unless subsection (3) applies to the proceedings, the Registrar must, at the end, decide:
(a)to refuse to register the trade mark; or
(b)to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;
having regard to the extent (if any) to which any ground on which the application was opposed has been established.
Note: For limitations see section 6.
The Opponent has made out a ground of opposition in both oppositions, so I have decided that the Trade Marks will be refused registration 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 the refusal shall not occur until the appeal has been withdrawn or discontinued. Otherwise the disposition of these applications should be in accordance with the Court’s orders or directions.

Costs

Both parties have requested an award of costs. The ordinary rule is that costs follow the event and I see no reason to deviate from this. In relation to the CFMB Trade mark I award costs against the Applicant, and in relation to the CMB Trade Mark I award reduced costs against the Opponent at 20% of the official scale[13] against the applicable amounts set out in sch 8 of the Regulations.
[13] Hume Industries (Malaysia) Berhard v James Hardie & Coy Pty Ltd [2001] ATMO 78.

Adrian Richards
Hearing Officer
Oppositions and Hearings
Trade Marks and Designs Group
21 July 2017