Caterpillar Inc v Puma SE

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FEDERAL COURT OF AUSTRALIA

Caterpillar Inc v Puma SE [2021] FCA 1014

Appeal from: Caterpillar Inc v Puma SE [2019] ATMO 99
File number(s): VID 773 of 2019
Judgment of: O'BRYAN J
Date of judgment: 27 August 2021
Catchwords: TRADE MARKS – application for registration of PROCAT word mark in classes 18 and 25 in respect of apparel, footwear, bags and accessories – opposition based on prior registration and reputation of CAT word and device marks – appeal from decision of Registrar of Trade Marks allowing registration – whether PROCAT deceptively similar to CAT within s 44 of the Trade Marks Act 1995 (Cth) – whether relevant to consider industry practice of using multiple marks on footwear – whether industry practice established on the evidence – degree of textual, phonetic and conceptual similarity – whether use of PROCAT mark would be likely to deceive or cause confusion because of the reputation of the CAT word and device marks within s 60 – whether reputation in CAT word mark established – whether use of PROCAT mark would be contrary to law by reason of contravening ss 18 and 29(1)(g) and (h) of the Australian Consumer Law – appeal allowed
Legislation:

Competition and Consumer Act 2010 (Cth) Sch 2 (Australian Consumer Law) ss 18 and 29

Trade Marks Act 1995 (Cth) ss 42(b), 44, 56, 60
Cases cited:

 Australian Competition and Consumer Commission v Employsure Pty Ltd [2021] FCAFC 142

Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2020) 278 FCR 450

Australian Postal CorporationAustralian Postal Corporation v Digital Post Australia Pty Ltd [2013] FCAFC 153; 308 ALR 1

Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641

Berlei Hestia Industries Ltd v Bali Co Inc (1973) 129 CLR 353

CA Henschke & Co v Rosemount Estates Pty Ltd [2000] FCA 1539; 52 IPR 42

Coca-Cola Co v All-Fect Distributors Ltd (1999) 96 FCR 107

Companhia Souza Cruz Industria E Comercio v Rothmans of Pall Mall (Australia) Ltd (1998) 41 IPR 497

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

Delfi Chocolate Manufacturing SA v Mars Australia Pty Ltd [2015] FCA 1065; 115 IPR 82

Gardenia Overseas Pty Ltd v The Garden Company Ltd (1993) 47 FCR 220

Google Inc v ACCC (2013) 249 CLR 435

Hashtag Burgers Pty Ltd v In-N-Out Burgers, Inc [2020] FCAFC 235; 385 ALR 514

In-N-Out Burgers, Inc v Hashtag Burgers Pty Ltd [2020] FCA 193; 377 ALR 116

Mars Australia Pty Ltd v Sweet Rewards Pty Ltd [2009] FCA 606; 81 IPR 354

MID Sydney Pty Ltd v Australian Tourism Co Ltd (1998) 90 FCR 236

Pacific Publications Pty Ltd v IPC Media Pty Ltd [2003] FCA 104; 57 IPR 28

Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191

Pfizer Products Inc v Karam (2006) 219 FCR 585

Pham Global Pty Ltd v Insight…

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Details
Case
[2021] FCA 1014
Decision Date

CaseChat Overview and Summary

In the Federal Court of Australia, Caterpillar Inc appealed against the decision of the Registrar of Trade Marks to allow Puma SE's registration of the PROCAT word mark in classes 18 and 25 in respect of apparel, footwear, bags, and accessories. The appeal hinged on the contention that the PROCAT mark was deceptively similar to Caterpillar's CAT word and device marks, which had been registered and used extensively in Australia and worldwide for heavy equipment and machinery, and later for apparel and accessories. Caterpillar argued that the use of PROCAT would likely deceive or cause confusion due to the established reputation of their CAT marks.

The Court considered whether the PROCAT mark was deceptively similar to the CAT marks under section 44 of the Trade Marks Act 1995 (Cth), and whether the use of PROCAT would be contrary to honest practices under sections 60 and 42(b) of the Act. The Court found that the PROCAT mark was indeed deceptively similar to the CAT marks, and that Puma had not provided sufficient evidence to establish the industry practice of using multiple marks on footwear. The Court also concluded that the CAT marks had acquired a reputation in Australia prior to the priority date of the PROCAT application, and that the use of PROCAT would likely deceive or cause confusion due to this reputation.

The Court allowed Caterpillar's appeal, set aside the Registrar's decision, and refused registration of the PROCAT mark. Puma was ordered to pay Caterpillar's costs of the appeal and the opposition proceeding before the Registrar of Trade Marks.

Orders

Orders of the court

1. The appeal be allowed.

2. The decision of the delegate of the Registrar of Trade Marks given on 28 June 2019 be set aside.

3. Australian trade mark application number 1803303 be refused registration.

4. The respondent pay:

(a) the appellant’s costs of this proceeding; and

(b) the appellant’s costs of the opposition proceeding before the Registrar of Trade Marks in line with the amounts in Schedule 8 of the Trade Mark Regulations 1995 (Cth).

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

For the reasons that follow, I accept Caterpillar’s primary contentions and allow the appeal.Overview of the evidence Evidence in the proceeding was given primarily by way of affidavit with relatively confined cross-examination. No challenge was made to the credit or reliability of any of the witnesses who were cross-examined although, as discussed below, Caterpillar submitted that certain opinions expressed by Mr Neil Narriman of Puma with respect to competition between Caterpillar and Puma should not be accepted. Documentary evidence was largely exhibited to the affidavits and a small number of additional documents were tendered.Caterpillar’s witnesses Caterpillar adduced evidence from the following witnesses. Stephen Straub is employed as an Attorney in the Legal Services Division of Caterpillar. Mr Straub swore an affidavit on 12 December 2019. He became qualified as a lawyer under the laws of the District of Columbia in the United States of America in January 2008. Until March 2015, Mr Straub was employed as an Associate at an intellectual property based law firm in Washington, D.C. called Roylance, Abrams, Berdo & Goodman LLP. Mr Straub commenced with Caterpillar in March 2015. He has responsibility for a wide range of intellectual property issues that arise in relation to the day to day business of Caterpillar in many countries around the world, including Australia. Mr Straub is responsible for trade mark prosecution, enforcement, contentious litigation and portfolio management relating to trade marks and domain names. This includes responsibility for Caterpillar’s brands in the USA, Canada, Australia and New Zealand, which include the CAT word and device marks. Mr Straub gave evidence about the nature of the Caterpillar business and its history. Although Mr Straub had only been with Caterpillar for a relatively brief period, he explained that he had developed a detailed knowledge of the history of the company, the products and services it has offered over time and how it has conducted its business over time (including its interactions with licensees and dealers) from business records of the company and his interactions with Caterpillar employees in his work. Mr Straub was cross-examined. Kenneth Beaupre is employed by Caterpillar as a Brand Licensing Manager. He affirmed an affidavit on 5 February 2020. Mr Beaupre gained a Bachelor of Science Degree in 1990 and was first employed by Caterpillar in 1997. In 2007, Mr Beaupre became a Retail Business Development Manager in the Caterpillar licensing business with responsibility for managing Caterpillar's global licensed merchandise business, processes and operations, including for apparel and footwear. In around December 2012, he was promoted to the position of Brand Advocacy and Licensing Manager, taking on responsibility for Caterpillar's CAT Brand Advocate program (a program focussed on raising awareness and understanding of the CAT brand amongst employees of Caterpillar and its dealers). In 2017, Mr Beaupre became the Caterpillar Brand Licensing Manager. Mr Beaupre gave evidence about the licensing business operated by Caterpillar and, in particular, the promotion and sale of CAT (and Caterpillar) branded apparel, footwear, bags and accessories in Australia. He was cross-examined.

Decision

Reasons for decision

Second, and relatedly, I do not place any material weight on the fact that the evidence suggests that it has been common for at least some traders to use multiple trade marks or branding elements on and in connection with footwear. In assuming fair and normal use of the applied for mark, the Court ignores the use of other marks or indicia that may distinguish the relevant goods: Saville Perfumery Ltd v June Perfect Ltd (1941) 58 RPC 147 at 174; Wingate at 128-129 and MID at 245. In any event, I accept Caterpillar’s submission that the evidence relied on by Puma in support of this conclusion is insufficient to make any clear finding about the extent of the practice across traders selling footwear, let alone the extent of the practice in respect of apparel, bags and accessories. The pictorial evidence on this issue was largely confined to the branding practices of Puma and Caterpillar in respect of footwear. The evidence of Mr Ors was confined to footwear and was given at the highest level of generality (in response to a question in cross-examination) and was qualified. Mr Ors agreed that, in relation to footwear traders in general, it is “not uncommon” to see multiple marks (such as a house mark, secondary mark and sub-brand) “depending on the style and market segment the trader was going after”. The extent to which the practice was followed in the Australian market, and across different market segments, was not explored with Mr Ors in cross-examination. Mr St Baker gave similar evidence in respect of footwear at a similar level of generality.Conclusion on s 44 In conclusion, I find that the PROCAT mark is deceptively similar to the CAT marks and that, as a consequence, registration of the PROCAT mark must be rejected under s 44 of the Act. Although not strictly necessary, I will also consider Caterpillar’s other grounds of appeal under ss 60 and 42(b) of the Act.Section 60 Caterpillar also opposes registration of the PROCAT mark on the ground stated in s 60 of the Act on the basis of the reputation of the CAT marks. Section 60 provides as follows:The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:(a)another trade mark had, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, acquired a reputation in Australia; and(b) because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion. In order to make out the requirements of s 60, Caterpillar must show that, before the priority date of the PROCAT application:(a)the CAT marks had acquired a reputation in Australia in respect of the PROCAT goods (broadly, apparel, footwear, bags and accessories); and(b)because of that reputation, the use of the PROCAT mark would be likely to deceive or cause confusion.Applicable principles I summarised the principles governing the application of s 60 in Rodney Jane Racing Pty Ltd v Monster Energy Company [2019] FCA 923; 142 IPR 275 (Rodney Jane) at [82]-[84]. Neither party advanced submissions that contradicted those principles. The principles can be restated as follows, omitting reference to the supporting authorities:(a)The purpose of s 60 is to provide protection for prior well-known marks, whether registered or not.(b)The likelihood of deception or confusion from the use of the opposed mark must arise because of the reputation of the prior mark. The Court must compare “mark and reputation” rather than “mark and mark”. (c)The ordinary meaning of the word “reputation” is the recognition of a person or thing by the public generally or the estimation in which a person or thing is held by the public generally. The reputation of a trade mark has quantitative and qualitative dimensions. The quantitative dimension concerns the breadth of the public that are likely to be aware of the mark, which can be evidenced by the quantum of sales, advertising and promotion of goods or services to which the mark is applied. The qualitative dimension concerns the image and values projected by the trade mark, which affects the esteem or favour in which the mark is held by the public generally. A mark may acquire a reputation in Australia through indirect exposure in the press, on television and on the internet.(d)The reputation of the prior mark is to be assessed at the priority date of the opposed application.(e)The relevant comparison is between the prior mark as actually used and a notional normal and fair use of the mark sought to be registered.(f)Section 60 is not constrained by the concept of deceptive similarity. Indeed, the words of s 60 do not refer to resemblance at all. The question is purely one of prior reputation. Nevertheless, the degree of similarity between the allegedly conflicting marks will be a relevant consideration.(g)The test for confusion under s 60 is not limited to whether consumers might think that the respective marks are the same. It is sufficient that consumers might wonder whether the respective goods might be connected in the course of trade. It is enough if consumers might think that the product bearing the impugned mark is a variant of, or related to, an existing brand.(h)There is no requirement that it be more probable than not that the use of the opposed mark will deceive or cause confusion. All that is required is that there is a real and tangible danger of confusion or deception. It is enough if the ordinary person entertains a reasonable doubt.(i)Evidence of actual confusion is not required.

Ratio Decidendi

Legal Principle Established

As at the priority date, Caterpillar (or members of its corporate group) manufactured, promoted, offered for sale and sold more than 300 different types of vehicles, machinery and equipment, including (listed alphabetically) articulated trucks, asphalt pavers, compact track and multi terrain loaders, compactors, excavators, forest machines, harvesters, hydraulic excavators and mining shovels, loaders, track-type tractors and wheel dozers. In the seven years leading up to the priority date, Caterpillar’s total worldwide annual sales revenue was in the tens of billions of dollars. As at the priority date, Caterpillar had customers in more than 180 countries and almost 100,000 employees around the world.Registration of CATERPILLAR and CAT trade marks From about 1909, the CATERPILLAR trade mark has been applied by Caterpillar and its predecessors in business to heavy equipment, vehicles and machinery that they have manufactured and sold. The “Caterpillar” name also became the company’s name in 1925 (first as Caterpillar Tractor Co. and subsequently as Caterpillar Inc). Benjamin Holt applied to register the CATERPILLAR trade mark in the USA on 18 November 1910. The CATERPILLAR trade mark was first registered in Australia by Caterpillar's predecessor, Holt Manufacturing, on 13 April 1911 in class 7 in respect of "Machinery; Agricultural and horticultural machinery, and parts of such machinery” (registration number 10993). Caterpillar started using the CAT word mark on its heavy equipment, vehicles and machinery in the 1940s. The first registration for the CAT word mark was filed with the United States Patent and Trademark Office (USPTO) on 10 March 1949, based on a first use of the mark in commerce in the USA in class 12 from December 1948 and in class 7 from February 1949. The mark was registered on 23 September 1952. The CAT word mark was first registered in Australia in class 7 on 14 April 1949 (registration number 98534). The CAT device mark was first registered in Australia in class 7 on 10 January 1989 (registration number 502749). From the 1970s, Caterpillar began using the CATERPILLAR and CAT trade marks in connection with a range of goods in classes 18 and 25 in the USA and elsewhere, including Australia. On 29 September 1982, Caterpillar applied to register the CATERPILLAR word mark in the USA in respect of goods in class 18 including briefcases, garment bags for travel, duffel bags, flight bags and tote bags, with the trade mark being registered on 5 June 1984. The statement of use notes that the application was based on use in commerce from January 1970. Also on 29 September 1982 Caterpillar also applied to register the CAT word mark in respect of goods in class 18 including briefcases, garment bags for travel, duffel bags, flight bags and tote bags and in respect of goods in class 25 including workwear, sports, casual, belts, ties, scarfs, headwear, shirts, shorts, vests, gloves and socks, with the trade mark being registered 2 October 1984. Again, the statement of use notes that the application for all of the above goods was based on use in commerce in the USA from January 1970.