Challenge Cancer Support Network Inc v Leukaemia Foundation of Queensland

[2002] ATMO 29

TRADE MARKS ACT 1995

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

Re:Opposition by Challenge Cancer Support Network Inc to registration of trade mark applications 800782 and 800783(36) - LEUK and LEUK BEAR - filed in the name of Leukaemia Foundation of Queensland.

Background

Trade mark applications 800782 and 800783 were filed by Leukaemia Foundation of Queensland ("the applicant") on 19 July 1999.  The trade marks are, respectively, the words LEUK and LEUK BEAR.  The services specified in both applications are "Charitable fundraising in the field of leukaemia and related blood diseases", which are services falling in class 36 of the International (Nice) Classification of Goods and Services. 

These applications were examined by the Trade Marks Office ("TMO") and advertised as having been accepted for registration. In view of what follows, I will note that the applications were accepted under the provisions of s 44(4) of the Trade Marks Act 1995 ("the Act").  That provision requires that an application be accepted, despite the existence of a conflicting, deceptively similar, registered trade mark, if it is established that the applied-for mark was used before the priority date of the deceptively similar registration.

Registration of the applied-for marks is now opposed by Challenge Cancer Support Network Inc. ("Challenge"). Challenge is the owner of two registrations that led to the application of s 44(4), the provision to which I have just referred. Challenge's registrations are for the trade marks LEUK THE DUCK (number 715690) and LEUK (number 715691). Those trade marks are registered, in the same class as the applicant's, for "Fund raising and charity services", and also for various goods in classes that are not germane to the current opposition.

Challenge bases its opposition on several overlapping grounds:

• Subsection 44(4) was wrongly applied and s 44(3), a somewhat similar remedy, is not available

• Ownership of the marks rests with Challenge (s 58 of the Act)

• The use of the marks by the applicant would lead to deception or confusion because of a conflicting reputation resident in the trade marks used by Challenge. (s 60)

Evidence

In support of its opposition, Challenge relies on the declaration of David Rogers with exhibits DR 1 to 17.  It served a copy of that evidence on the applicant and filed a copy with the TMO as provided by regulation 5.7.

Challenge, as a charity, deals with leukaemia and related diseases in children.  It raises money for research and aims to support affected children and their parents. In simple terms, LEUK is, at least, the name of a cartoon character that is somewhat of a mascot for Challenge.  Challenge appears to have worked to build up a degree of animation in Leuk's persona, presumably as part of its overall strategy of keeping up the morale of affected children. 

The Leuk character is a duck, drawn for Challenge in 1990 and featured since 1991 in all their letterheads, promotional material and the like.  The duck is featured, in a variety of poses, in Challenge's quarterly magazine, exhibit DR 8 and others, and is the hero of a cartoon or comic strip therein.  He is allegedly available to visit schools to speak about leukaemia.  In printed form, he points, jumps and flaps his way around the pages of, particularly, the 1991 editions of the Challenge magazine. 

The applicant, despite seeking two extensions of time for the purpose, did not serve any evidence in answer to the Rogers declaration.  It finally notified the TMO that it would not do so and requested that the matter be heard.

I was assigned to hear the parties and decide the opposition under delegation from the Registrar of Trade Marks.  At that hearing, the applicant was represented by Robin Kelly, a patent attorney of the attorney firm Fisher Adams Kelly.  Challenge was represented by Colin Oberin of the attorney firm of Allens Arthur Robinson.

In the time preceding the hearing, it became clear that the applicant proposed to vary the process set down in the regulations dealing with the evidence stages of an opposition.  Strictly speaking, an applicant that intends to rely on evidence in answer to an opposition is obliged to serve a copy on the opponent, within the time allowed by the regulations.  In this instance, the applicant asserted that it was entitled to rely, for the purposes of the opposition, on the evidence filed at the TMO prior to acceptance.

It may be reasonable, in some opposition matters, for the Registrar to have regard to other evidence that has already been relied on during examination.  Obviously, his/her concern will be to see that this is done fairly, with an adequate right of reply for the opponent.  See Shanahan's Australian Law of Trade Marks and Passing Off, pp72 and 73.  However, s/he does so at his or her discretion.  An applicant that has neglected to serve a copy of evidence on which it wishes to rely is at serious risk that, where s 44 is involved, the Registrar may decline to take such evidence into consideration in deciding the opposition.  Typically, and most contentiously, such evidence goes to alleged use of the applicant's mark in the face of the opponent's.  Fairly obviously, the party with the primary concern to bring in such evidence is the applicant and the failure to do so affects the applicant much more than it affects the general interest that all users of the system have in its fair and informed operation.  The Registrar will, in a case where such evidence is so crucial to the applicant's case, and so counter to that of the opponent, be reluctant to bring in material the applicant has deliberately left out.

In the present matter, the evidence relied on by the applicant to gain acceptance has been admitted on the request of the applicant and the express concurrence of the Challenge's legal representative, Mr Oberin.  He agreed that the evidence could be considered but he pointed, in doing so, to one significant thing: it is not evidence in answer to the evidence in support relied on by Challenge.  If there are allegations made in the Challenge's evidence, the applicant's evidence is no answer to them because it was made prior to them, before the commencement of the opposition process.

In all other respects, the evidence of the applicant, a declaration by Phillip Desbrow, with exhibits PCD1 to 9, is material properly disclosed to the opponent, admitted on their say-so, and to which I can have regard.

The applicant's evidence

In brief, Mr Desbrow sets out the applicant's claims as follows:

At the time of first use of the trade mark in Queensland, the name LEUK or LEUK THE BEAR was chosen because LEUK was a phonetic equivalent of the name Luke, while also being a "natural reference" to Leukaemia.  "The idea was conceived", though Mr Desbrow does not say by whom, "that a teddy bear christened LEUK or LEUK THE BEAR could be sold as a fundraiser". 

Mr Desbrow states that at the time of derivation or coining of the trade mark LEUK, he personally had no knowledge of any other trade mark used in relation to charitable fundraising which was substantially identical with or deceptively similar to the trade mark LEUK.

As to this alleged trade mark use, Mr Desbrow has provided samples of LEUK clutch pins and LEUK cards depicting a teddy bear device.  He says that, following "extensive and continuous use since 1995" ... "such teddy bears" produced for the applicant, are now collectively known as LEUK BEARS, or individually as LEUK THE BEAR.  Such pins, he says, "have been distributed under the trade mark LEUK or LEUK BEAR" in all Australian States.

Mr Desbrow concedes that, in many of the examples of the packaging, the word LEUK does not appear.

Section 44 - The law applicable:

Pivotal to the acceptance are the terms of s 44, of which two subsections are initially relevant, s 44(2) and (4).  I set out also s 44(3), to which Mr Oberin directed submissions, and include only the directly relevant Notes:

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.  "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".

Note 2:  For similar services see subsection 14(2).  In this instance, there is a direct overlap of the services specified by the applicant and by Challenge's registration.
Note 3:  For priority date see section 12. The priority date for the applicant's trade marks is their filing date, 19 July 1999.  Similarly, Challenge's trade mark registrations have a priority date of 20 August 1996.

(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.

(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.

Decision

Section 44 issues affecting both applications

At the hearing, the representatives were each quite rightly critical of the other side's evidence. Much of Challenge's evidence does not show use of LEUK as a trade mark. However, Challenge's trade mark rights are not at issue in the present opposition process. What is at issue is, firstly, the registrability of an application that was accepted under s 44 on the express application of s 44(4).

S 44(2)

The services specified by the applicant and by Challenge are overlapping, and the registrations to which I have referred and on which Challenge relies have an earlier priority date than the applicant's.  Therefore, if s 44(2) is to be triggered, I must find that the applicant's trade marks LEUK and LEUK BEAR are (tested separately) deceptively similar to either of LEUK and LEUK THE DUCK.

At the hearing, Mr Oberin, for the opponent, Challenge, argued that:

• the elements, THE DUCK and BEAR, were not significant.  He submitted that, when applied to the sale of bears, the trade marks LEUK and LEUK BEAR are virtually the same.  This is reflected in the fact that the applicant's evidence shows that bears sold under the trade mark LEUK are known as LEUK BEARS,

• sales of LEUK THE DUCK and LEUK THE BEAR or LEUK BEAR would be considered as sales of an animal under the LEUK trade mark

• in all three cases the essential feature of the marks LEUK, LEUK THE DUCK and LEUK BEAR is the word LEUK.

Mr Kelly, for his part, stressed the obvious differences between a duck and a bear and argued that LEUK was, at least to a limited degree, descriptive.  Therefore, he said, the weight in the comparison should be on elements other than LEUK.  Any use of LEUK was as a first name, for a duck on one hand or a bear on the other.  Those hypothetical animals were readily distinguishable.

While Mr Kelly's arguments may have some merit, he did not seriously argue that the applicant's LEUK trade mark is not substantially identical with the LEUK trade mark already registered by Challenge.  As regards that trade mark application, number 800782, I find that s 44(2) is triggered.

The remaining question concerns application 800783, LEUK BEAR.  Is it deceptively similar to either of Challenge's registered trade marks: LEUK or LEUK THE DUCK? 

Section 44, even in opposition, still has within it a presumption of registrability.  It is not established as a ground of opposition unless the necessary elements are shown.  As set out briefly by French J in Registrar of Trade Marks v Woolworths [1999] FCA 1020 , at paragraph 45:

The position now is that the Registrar and the Court at first instance would need to be satisfied that there was a reasonable likelihood of deception or confusion before denying acceptance of the application for registration.

In deciding that question, context is important.  The applicant is seeking rights for a trade mark for use for charitable services in relation to leukaemia and other cancers.  Notionally, the applicant should be considered to be intending to engage in any legitimate uses of such a trade mark.  "What can the applicant do if it obtains registration", is the question.

That question is to be asked in a context where, notionally, Challenge is entitled to make equally broad use of its own registration of, in particular, LEUK.  In deciding if LEUK, as a trade mark for Challenge's services, is deceptively similar to LEUK BEAR, I should not put too much weight on the fact that, currently, Challenge uses LEUK in relation to activities involving a duck character.  Nor should I put too much weight on the converse: while I cannot entirely rule the possibility that Challenge may want to use its registered trade mark exclusively in relation to a line of toy bears or bear lapel-pins, such an assumption is extreme.

On balance, therefore, I must allow for the fact that, notionally, Challenge is entitled to conduct a broad range of trade in, among other things, soft toys in general, and lapel pins in general, as part of what is, overall, the charitable fundraising service in which it trades.  It is part of the entitlement that comes with its registration.  The fact that Challenge is, at the moment, apparently avoiding fundraising activities involving bears, and specialising in activities involving a duck theme, is something that I must disregard.

I note that there is unchallenged evidence that there has been some confusion between the activities of Challenge and of the applicant.  The details of this are very sparse.  Mr Rogers, the CEO of Challenge, is:

aware of cases where members of the public have purchased LEUK BEAR badges believing their donation would be used to support the Opponent's activities.  I am personally aware also that members of the medical fraternity and other supporters of the opponent have seen or heard of LEUK BEAR and have believed LEUK BEAR to be associated with the opponent.

I do not give this evidence full weight as it is anecdotal and lacking any detail.  Also, it does not go specifically to the typical questions of the confusion of one trade mark with another.  Mr Rogers has not declared that he has ever come across a single instance where one trade mark has been mistaken for the other, or where a connection was inferred between the two competing entities based on the element in common.  His evidence may, perhaps, mean no more than that he is aware of people who speculated too strongly about some sort of possible umbrella organisation linking the two parties, both charitable organisations working in cancer-related fields.  However, as Mr Oberin pointed out, there is no evidence at all in answer to this allegation.

Mr Kelly argued that when used with the word "duck" or "bear", the word LEUK takes on the colour of the services.  The element in question is not LUKE, it is LEUK.  Given this spelling, and the context in which it is used, it is for me to now decide if, in the minds of a significant number of people who encounter either trade mark, there will be the basis of a reasonable doubt about a common origin. 

The trade mark LEUK BEAR is sought to be registered in relation to charitable services in relation to leukaemia.  In that context it serves both as a quasi-name and as a quasi-reference to the charitable purpose in which the organisation trades.  I do not say that the word LEUK is entirely descriptive of services in relation to leukaemia.  There is no evidence at all to suggest this, and neither side asserts that LEUK is not a trade mark that is capable of distinguishing.  None the less, its derivation is clear and will be quite obvious in any charitable fundraising context that involves cancer. 

On the other hand, I think it would be extreme to assume that the proportion of people who actually think about this matter, when supporting a charitable cause, will necessarily be high.  Very typically, this context is one where a donation is being solicited, typically in a context where a careful analysis of the derivation of a trade mark is simply not available.

To many such people, the thing that will make the initial impact is that the trade mark is an obvious, but not an ordinary, mis-spelling of the name Luke.  Such a person, inclined to support a charitable cause, will be particularly likely to assume that the element LEUK occurs in the trade mark LEUK BEAR simply to indicate a connection with Challenge.  It will not matter, at that point, if the goods being sold as an adjunct to the charitable services in question are soft bears, duck-shaped metal lapel badges or dried flowers.  The person is, after all, not necessarily buying a toy per se so much as supporting a charitable organisation.

That being so, I accept that the notional use of LEUK BEAR by the applicant cannot coexist with legitimate uses, by Challenge, of the trade mark LEUK.  A similar conclusion applies, though with somewhat less force, in relation to the differences between Challenge's other registered trade mark, LEUK THE DUCK, and the applicant's LEUK BEAR trade mark.

Accordingly, I find that, for these leukaemia-related services, both trade mark applications 800782, LEUK, and 800783, LEUK BEAR, are caught by the terms of s 44(2).

S 44(4)

It follows from my conclusion above that if either application is to proceed to registration it must do so by way of either s 44(4) or, perhaps, s 44(3).

I note that the provisions of s 44(4) were applied in the examination stages. At that stage, full force was given to the assertions of Mr Desbrow, and I think that this is generally appropriate in an ex parte situation. However, section 44(4) is a provision that leaves the registrar no discretion once it is triggered. I think that, if the application of that provision is challenged in the opposition forum, the alleged triggering facts should be required to be clearly demonstrated, and this requires a correspondingly high evidentiary threshold. If the applicant, once opposed, intends to rely on this provision, it needs to establish the date of first use positively, by way of facts and not simply by assertion.

Apparently some time early in 1996, the applicant started to trade in metal lapel pins under the trade mark LEUK or perhaps under the mark LEUK THE LEUKAEMIA BEAR.  That trade appears to have been a commercial trade, wherein the words in question were used as a brand to indicate the lapel pins that the applicant was selling to support its charitable works in relation to leukaemia.  I find that this was both a trade in the goods in question and a trade in charitable fundraising services.

I have already referred to Mr Desbrow's declaration in general terms.  It reflects, I believe, the fact that it was prepared for something other than an adversarial context in which issues of trade mark use would be closely considered. 

The first example of alleged trade mark use is said to be exhibit PCD1.  Mr Desbrow asserts that this is evidence of first use on April 21 1995.  Specifically, it is said to be evidence that "a teddy bear described in the article as 'LEUK THE BEAR' was sold at Clifford Gardens in Toowoomba..." on that date. 

The exhibit shows an extract from the Toowoomba Chronicle of 21 April 1995.  It is an article headed by a photograph of two children, one of them holding a teddy bear, the other holding what appears to be a coin.  The caption under the photograph is headed "Beating Leukaemia" and goes on to say:

(one child) will help sell 'Leuk the Bear' in Toowoomba this weekend to show his support for Leukaemia Week, while (his sister), an entrant in the Leukaemia Quest, looks forward to next week's doorknock appeal.

The heading of the article, below the photo and its caption, reads:

Buy a bear to help fight against leukaemia.

Tomorrow is the start of Leukaemia Week in Queensland.  Helping out is easy - you can give 'Leuk the Bear' a home in exchange for $2.

This cute little bear is part of the Leukaemia Foundation of Queensland's efforts to raise community awareness of the disease, and other blood-related diseases, while also explaining how the Foundation helps patients and their families.

This is typical of much of the applicant's material: it either says that a thing is planned for some future date, or explains, after the event, why a planned launch failed.  Specific evidence about what actually happened, when, and on what business terms, is often lacking.  The article in evidence as PCD1 suggests that "this cute little bear" - apparently the soft toy shown in the accompanying picture - was intended to go on sale the following week.  However, there is very little evidence that this happened. 

Figures for the sales value of "bears" are quoted by calendar years at paragraph 11 of the Desbrow declaration.  It is not clear if these are metal lapel-pin bears or soft-toy bears, or both.  Either way, there is simply no figure for 1995 in paragraph 11.

In paragraph 9, the following sales are claimed, for Queensland alone:

1994-95          7 Fluffy bears

1995-96          400 fluffy bears

1996-97          56000 bear pins

Sales in NSW commenced or after May 1997, and in South Australia sales commenced in or after October 1998.  

Minutes for meetings of the applicant's Toowoomba branch show problems, in late 1995, with the supply of lapel pins.  Minutes of the Toowoomba branch in November 1995, note that "metal bears will be sold on 11 May at Clifford Gardens for Leukaemia week".  The minutes go on to say "The meeting decided that the bears can be sold as soon as they arrive.  A card is to be printed stating that this 'Leuk the Bear' and badge will be pinned to it". (My emphasis added in both instances.)

I gather that this card may be similar to one of the ones in evidence as PCD2.  That exhibit shows 7 labels, cards or badges, of which only two use the word LEUK - "Hi - I'm LEUK the Leukaemia Bear".  Consistent with these is material from the actual manufacturer of the badges and produced some time prior to 17 December 1996.  This states that the badge was "Conceived in November 1995, Born in April 1996 and Introduced to the public in May 1996 by the Toowoomba Branch of the Leukaemia Foundation".  This date, May 1996, would coincide with the plans in the earlier (November 1995) minutes of the Toowoomba Branch.

Later minutes (December 1995) show: '"Leuk the Bear has arrived.  Treasurer to pay account.  Cards to be printed for "Leuk" to be pinned on.'

Overall, it seems that a teddy bear pin first went on sale, as part of the applicant's charitable services, some time in early 1996.

The figures in paragraphs 9 and 11 lead me to believe, in the lack of any added detail, that the earliest use, the seven bears allegedly sold in 1994-5, was something other than the continuous use of a trade mark.  Much of the applicant's evidence suggests that any use of LEUK or LEUK BEAR in relation to soft toys was something of an add-on.  It would be equally consistent with the evidence if I was to surmise that the applicant was simply using soft teddy bears to lend a cute image to whatever business it was doing by way of selling lapel pins as a serious fund-raising effort.  The fact that it happened, somehow or other, to sell four such bears in 1994-1995 is not, in itself, sufficient to meet the standard of proof required in an opposition matter. 

There is no detail about the selling of the 400 bears in 1995-96 and I am left to infer that they were sold in a way akin to exhibit PCD1. 

I am not absolutely convinced that any of the exhibits in the material is necessarily a use by the applicant of LEUK as a trade mark in relation to charitable fundraising at the date that is critical for s 44(4) purposes, 20 August 1996. However, in view of what follows, I am content that the applicant gets the benefit of the doubt at this point. Therefore, I will take the simplest reading of the evidence.

Even if am thus prepared to accept that this, in total, might be a picture of use of a trade mark in relation to charitable services of the sort in question, and prior to August 1996, a problem would remain.  Is the mark so used LEUK, or LEUK THE BEAR, or LEUK BEAR, or some other variant?

Mr Desbrow says in his declaration that the variants have coalesced.  He also concedes that sometimes the word LEUK does not appear at all.  I accept that whatever use there was of a trade mark involving the word LEUK was inextricable from bears of one sort of or another.  Therefore, I think that it is probably unreasonable to attempt to distinguish one mark from the other.

I therefore believe that s 44(4) was properly applied, and is available to the applicant in the present circumstances and for both applications.

The matter of s 44(3) was also dealt with at hearing.  However, I decline to apply the provisions of s 44(3) in the applicant's favor.  Challenge has brought into evidence two significant allegations; that:

• there has been actual confusion between the activities of the applicant and Challenge under their various trade marks and otherwise, and, more seriously, 

• the applicant was fully aware of the LEUK THE DUCK identifier used by Challenge. 

Those allegations are unanswered.  Perhaps there might be little danger for the applicant in either one of them separately.  Together, however, they require me to give particular weight to what might otherwise be said to be an accidental failure of Mr Desbrow to fully explain just who it was who coined the trade marks used by the applicant, or why, or with what knowledge.  I do not imply that there was dishonesty.  I would be very reluctant to do so in the case of any applicant that is clearly doing very necessary community work.  Even so, the applicant has failed, when called to account by Challenge, to make manifest the necessary degree of honesty in the process by which the mark was adopted and used.

My conclusion, therefore, is that neither application 800782 nor 800783 is caught by the provisions of s 44, in view of the availability of s 44(4) alone.

Remaining issues affecting applications 800782 and 800783

Ownership

In matters affecting the ownership of a trade mark, the law is fairly clear.  To displace the applicant's claim to ownership, Challenge must be able to point to prior use for the same mark for the same kind of thing.

To decide this, I must go in detail to the evidence of Challenge about the business it has conducted.

The evidence in support shows that the cartoon character adopted by Challenge has been widely used within the context of Challenge's operations.  Mr Rogers goes so far as to assert that the applicant should have been aware of the existence and identity of Challenge's mascot, but that claim has been met with silence.  I am satisfied that, to most of those who had dealings with Challenge, the duck-like attributes of Leuk the Duck would have been familiar.  Where that mascot is referred to, he is sometimes given the name Leuk, as when his creator, the cartoonist Mark Knight, says, "Leuk has matured with age, visually".  Similarly, comic strips about the character, whose name is clearly Leuk the Duck, sometimes end with "stay tuned for more adventures with Leuk".

Again, exhibit DR 12 contains a lapel badge that depicts the cartoon duck above the prominent word LEUK

T-shirts and the like, mouse pads and other merchandise are said to have been sold.  According to Mr Rogers, these items feature "the trade marks and the LEUK THE DUCK character".  Mr Rogers then goes on to refer to DR 11 as being a promotional item - it appears to be a sign or notice - "advertising LEUK THE DUCK merchandise".  The sign does indeed indicate "LEUK THE DUCK OFFICIAL MERCHANDISE".  However, I am not at all sure that Mr Rogers speaks with precision when he says that the merchandise features the trade marks and the character.  There is sometimes no distinction to be drawn, since the cartoon duck character is very clearly being used as a trade mark. 

Many members of the public may have been aware, long before the applicant filed application 800783, that Leuk was the name of a cartoon character.  However, this in itself does not give Challenge any rights in the word LEUK as a separate trade mark.  Challenge's trade mark rights stem from use as a trade mark, and are limited to the trade mark(s) it has used. 

There is a single instance (exhibit DR12) of a badge bearing the word LEUK and a duck device.  I have not been shown when or how it was offered for sale, but I presume that it is the "Leuk Badge" referred to in an order form that is part of the magazine comprising exhibit DR 3, published in September 1991.  This form, at page 28 of DR3 reads (bolding present in original):

CHALLENGE AND LEUK BADGE ORDER FORMS

Both Leuk and Challenge badges are available for $3 each.  Fill in the order form below and send it ... (followed by payment and posting details)

There is also a similar, but perhaps less clear-cut, trade mark use in exhibit DR2 at page 6.

I think these are sufficient to show that Challenge was trading, not just in badges, but in charitable fundraising of the same sort as the applicant, and that the mark used was LEUK.

Mr Oberin argued that any disparity between Challenge's trade mark LEUK and the applicant's LEUK BEAR could be overlooked, to the detriment of the applicant.  I agree with him.

In Carnival Cruise Lines Inc v Sitmar Cruises Ltd, 31 IPR 375, there were a total of three trade marks, in each of two classes, at issue. These were: FAIRSTAR THE FUNSHIP, SITMAR'S FUNSHIP, and FUNSHIP. The opponent to registration in that case had used the trade marks FUNSHIP and FUNSHIPS. Gummow J decided that, in relation to the ownership question, the differences in marks would have prevented the opposition succeeding in relation to FAIRSTAR THE FUNSHIP and SITMAR'S FUNSHIP.

Mr Oberin, for Challenge, argued at hearing that there was no material distinction between the trade mark LEUK BEAR and the trade mark or marks used by Challenge.  This is something of an extension of various administrative decisions, to which he referred.  These were Micro Com Pty Ltd v Micro Com Systems Inc (1998) 41 IPR 163 and, more recently, eStar Online Trading Pty Ltd v Estar Limited.  In both of those, a pure generic term had been the distinguishing feature between the competing marks.  In the first case, the difference was the words "Networking Protocol" for computer-related goods.  In the latter, the differing element was "Online", for services including the provision of services over the Internet.

Mr Oberin may be correct to say that, for toy bears, "bear" - or "the bear" - is generic, but it is not so in relation to the fundraising services that are now at issue.  On the other hand, as Challenge argued, these services involve bear badges.  While the word BEAR makes an apparent contribution to the identity of the mark, its contribution is not something that, in practice, makes a difference.  The evidence shows that in the applicant's hands, LEUK, LEUK THE BEAR, LEUK BEAR and LEUK bears are all more or less interchangeable.

In PB Foods v Malanda Dairy Food Ltd [1999] FCA 1602, 47 IPR 47, Carr J said:

[30]  In my view, the comparison side by side should be with CHOC CHILL on the one hand (or COFFEE CHILL, VANILLA CHILL, STRAWBERRY CHILL) and CHILL on the other. My reason for that is that CHOC CHILL is the name for which the applicant seeks registration.

[31]  Having said that, I consider that the essential feature of the trade mark is the word “chill”. When one considers the basic policy of the 1955 Act, it is the word “chill” which serves to denote the trade origin of the goods.

[32] The word “choc” has, almost exclusively, different work to do. It describes the flavour of the goods. Registration is sought on the basis that that description will change with the flavour to “coffee”, “vanilla”, “strawberry” and the like. Those words are (to borrow from a decision cited below) utterly descriptive.

[33]  I have had regard to the cases cited on behalf of the applicant where a mark consisting of two words has been compared with a mark consisting of one word. They included Carnival Cruiselines where one of the comparisons was between SITMAR’S FUNSHIP and FUN SHIP. In that case (at ALR 513) Gummow J expressed the view that there would be no material distinction to be drawn between FUN SHIP and FUNSHIP or between the addition of the definite article or the use of the plural. However, FUN SHIP was a substantially different trade mark from SITMAR’S FUNSHIP and FAIRSTAR THE FUNSHIP. Mr Martin referred me to other decisions where marks consisting of two words were compared with a mark consisting of one word, many of which were not curial decisions. I will not refer to them all (they are collected at para 8 of the applicant’s outline of submissions). However, Mr Martin singled out a comparison between PLANET 2000 and PLANET in Somers v Greenbelt Pacific Pty Ltd (1998) 42 IPR 587 at 589 (a decision of a senior examiner of trade marks). In that case the senior examiner held that despite the fact that the numeral “2000” added little inherent adaptation to distinguish the goods of the applicant from those of other traders, the marks PLANET and PLANET 2000 when placed side by side, had a clearly identifiable difference.

[34]  On the other hand, in Microcom Pty Ltd v Microcom Systems Inc (1998) 41 IPR 163 at 168 Hearing Officer Forno compared MICROCOM with MICROCOM NETWORKING PROTOCOL and said this:

… I do not think that the additional words “Networking Protocol” are sufficient to differentiate the applicant’s and opponent’s marks. Those two words are utterly descriptive for some of the goods covered and add nothing to the mark. This is, I think, analogous to the situation where, say, the trade mark RINSO was being compared with another mark RINSO WASHING POWDER.  Clearly, these marks are substantially the same. I think that any comparison between the present opponent’s mark and that covered by No 523656, [Microcom Networking Procol] would lead to a conclusion that those marks are also substantially the same.

[35]  I have considered the applicant’s submission that the first word of a mark has an impact because of its position. I think the validity of that observation depends very much upon what that first word is and what the second word is. For example, if the word were “The” then it would have very little impact: see the passage from Carnival Cruiselines referred to above.

The applicant is now to be on the receiving end of an argument that worked in its favor under s 44.  If it is sufficient for the applicant to argue that, for the purposes of s 44, the marks LEUK and LEUK BEAR have merged, it cannot complain that Challenge uses the same argument to show that Challenge's use of LEUK defeats both applications.  The converse argument, that one charity is trading in LEUK as part of its services, while another can become the owner of LEUK BEAR for services that are, in its own hands and in practice, inseparable from the sale of bears, is fraught with difficulties.  The question of ownership is meant to be a practical question, not an exercise in abstract distinctions.  Accordingly, I find that a ground of opposition has been established under s 58 in relation to both applications.

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

The legislation provides as follows:

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

(a) it is substantially identical with, or deceptively similar to, a trade mark that, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, had acquired a reputation in Australia; and
(b) because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.

Note 1:  For deceptively similar see section 10. "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".

In dealing with paragraph (a) of this provision, Mr Oberin, on behalf of Challenge, and Mr Kelly, for the applicant, relied on the arguments that I have already set out in reference to s 44.  I have already concluded that there is the necessary element of, variously, substantial identity or deceptive similarity. 

However, the s60 ground on which Challenge relies must fail under paragraph (b).  That provision does not simply ask: "will what the applicant seeks to do cause deception or confusion?"  Rather, it puts the matter in terms that require several links to all be affirmatively established. 

Firstly, does the question under s 60 involve a conflicting trade mark?  I have found, in deciding the proprietorship question, only the most limited use of the trade mark LEUK.  Even so, for the purposes of para (b), there is a trade mark and the next question is, "Does that trade mark have a reputation such that, for whatever reason, the use proposed by the applicant will lead to deception or confusion?"

I find that the trade mark does have a reputation.  It is a reputation confined, perhaps, to a niche of the general community but, if so, it is the niche in which the applicant, too, is operating, and precisely that for which it seeks registration.  In McCormick & Co v McCormick  2000 FCA 1335, the Federal Court recognized that reputation can be driven by more than sales, and may be large where sales are small.  I think this is likely to be particularly so where the market in question is a small segment of the community. Moreover, the extent of the reputation is much greater than the small amount of trade mark use that has enabled the triggering of this issue.

There are, within the relevant segment of the population, many people who will recognize the word in question as the name of a cartoon character adopted by Challenge in 1991.  That cartoon duck is a character in its own right, with an identity of its own.  However, that knowledge will protect those people from confusion between the (to them) well-known Leuk the Duck and LEUK BEAR.  The two are very different, and the character of Challenge's reputation goes against any bear-based campaign or operation.  This is not the notional or hypothetical inquiry that applies under s 44.  The reputation built up by Challenge cannot, under s 60, be separated from the persona of the cartoon character in question. 

There may be some residual level of speculation, perhaps that the applicant might need some form of approval from Challenge to, as Mr Oberin put it, "cash in" on a possible adaptation of the duck-based strategy.  Indeed, there is some evidence of deception.  However, given the lack of detail in that evidence, I do not think it will go far to address the specifics of this case. 

Conclusion.

I have decided that a ground of opposition has been established under s 58 in relation to both applications.  My decision in term of s 55 is to refuse to register them.  I order that the applicant pay Challenge's costs in terms of the official scale. 

Terry Williams
Hearings Officer
Trade Marks Hearings
28 March 2002