Clinique Laboratories, LLC v Clinique La Prairie Franchising SA

TRADE MARKS ACT 1995

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

Re:Opposition by Clinique Laboratories, LCC to extension of protection of International Registration Designating Australia 1342372 (IR No. 1025395) (5 and 32) - CLINIQUE LA PRAIRIE - filed in the name of Clinique La Prairie Franchising SA (Clinique La Prairie Franchising AG)(Clinique La Prairie Franchising Ltd).

Delegate:	Heath Wilson
Representation:	Opponent: Ed Heery of counsel instructed by Baker & Mackenzie. Holder: Siobhan Ryan of counsel instructed by Griffith Hack.
Decision:	2013 ATMO 87 Opposition under regulation 17A.29 – ground pressed under section 60 of the Trade Marks Act 1995 – extension of protection refused for goods in class 5 – parties bear own costs.

Background

Clinique La Prairie Franchising SA (Clinique La Prairie Franchising AG)(Clinique La Prairie Franchising Ltd) (‘the Holder’) a company based in Switzerland, applied for the extension of protection to Australia of a trade mark the details of which are:
International Registration No. 1025395
Trade Mark No. 1342372
Trade Mark: CLINIQUE LA PRAIRIE
Priority Date: 30 November 2009
Designated Goods:
Class 5: Mineral food supplements; nutritional additives for medical purposes

Class 32: Mineral and aerated waters or other non-alcoholic beverages; fruit drinks and fruit juices; syrups and other preparations for making beverages
Following examination, the above International Registration Designating Australia (‘IRDA’) was accepted for possible protection in Australia. That acceptance was advertised in the Australian Official Journal of Trade Marks on 1 April 2010.
On 30 June 2010, Clinique Laboratories, LLC (‘the Opponent’), a company based in the United States of America filed a notice of opposition under regulation 17A.29 of the Trade Marks Regulations 1995 (‘the Regulations’).
Regulation 17A.31 sets out the grounds for opposing an IRDA. These grounds include sections 39 to 44 inclusive of the Trade Marks Act 1995 (‘the Act’), (by virtue of regulations 17A.31 (1) and 17A.28 (1)), and sections 58 to 62A of the Act (by virtue of regulation 17A.31 (2)). The notice of opposition nominated all possible grounds under the Act and I note that for the section 44 ground the Opponent nominated sixty trade marks (predominantly in class 3) incorporating the word ‘CLINIQUE’.
Evidence in support was eventually filed in the form of two statutory declarations. The first was that of Agnes Landau, Senior Vice President (Global Marketing) of the Opponent, made on 26 June 2012 with exhibits AL-1 to AL-16 (‘Landau 1’). The second declaration was made by Wayne Van Der Merwe, Financial Director and Company Director of Estee Lauder Pty Ltd, on 29 June 2012 annexing exhibits WVDM-1 to WVDM-20 (‘Van Der Merwe’).
The evidence in answer filed by the Holder consisted of the statutory declaration of Gregor Mattli (Chairman of the Holder’s board) made 16 January 2013 with annexures A to H (‘Mattli’).
A second declaration of Agnes Landau (‘Landau 2’) was made on 7 May 2013 with annexures AL-1 and AL-2 and filed with the office as evidence in reply.
The opposition was set down for a hearing. The Opponent indicated via its written submissions that it only wished to pursue the ground of opposition under section 60 of the Act. I heard the matter in Melbourne on 10 September 2013 as a delegate of the Registrar of Trade Marks. The Holder was represented by Siobhan Ryan of counsel and the Opponent was represented by Ed Heery of counsel.

Onus

The Opponent bears the onus of establishing one of the grounds stated in the notice of opposition on the balance of probabilities[1]. The ground of opposition is that under section 60, which I now address in the following reasons.
[1] See Pfizer Products Inc v Karam [2006] FCA 1663; 237 ALR 787; (2006) 70 IPR 599; [2006] AIPC 92-146; Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891; (2009) 180 FCR 60; (2009) 258 ALR 545; (2009) 82 IPR 13; [2009] AIPC 92-355 at [22] to [26] and NV Sumatra Tobacco Trading Company v British American Tobacco Services Limited [2011] FCA 1051.

Reasons

Section 60 of the Act provides:

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

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 other words, the Opponent must establish the existence of a reputation in a trade mark (or trade marks) as at 30 November 2009 such that the use of the Holder’s IRDA would be likely to deceive or cause confusion in the Australian marketplace.
In McCormick & Company Inc v McCormick[2], Kenny J defined ‘reputation’ under section 60 in the following manner:
What is intended by the word “reputation” in s 60? The word is defined in The Macquarie Dictionary as follows:
reputation ... 1. the estimation in which a person or thing is held, esp. by the community or the public generally; repute ... 2. favourable repute; good name ... 3. A favourable and publicly recognised name or standing for merit, achievement, etc. ... 4. The estimation or name of being, having done, etc, something specified.
Cf. The Oxford English Dictionary.
In s 60, the word is, I think, apt to refer to “the recognition of the McCormick & Co marks by the public generally”.
[2] McCormick & Company Inc v McCormick [2000] FCA 1335; (2000) 51 IPR 102 per Kenny J (at para 81).
Mr Heery pressed the section 60 ground on two fronts, namely that there existed a significant reputation in the Opponent’s trade mark CLINIQUE sufficient for the use of CLINIQUE LA PRAIRIE to be likely to result in deception or confusion, and/or there existed a significant reputation in the trade mark LA PRAIRIE (owned by a third party Beiersdorf AG) which would have the same result.
For section 60, I must consider a notional use of the Holder’s IRDA on all of the designated goods in classes 5 and 32. While it is not a requirement for the Holder’s designated goods to be similar to the goods in which the Opponent’s trade mark reputation resides, it is a relevant factor in determining the likelihood of confusion. In the current matter, I note that that designated goods of the IRDA include mineral food supplements, nutritional additives and non-alcoholic beverages (including mineral water, fruit juice and syrups).
Ms Ryan’s argument is that whatever reputation the Opponent may be able to demonstrate in the trade marks CLINIQUE or LA PRAIRIE respectively; it is confined to cosmetics and skin care preparations, rather than any of the ingestible products that comprise the designated goods.

Reputation of ‘CLINIQUE’ in Australia

The Opponent is owned by Estee Lauder Companies Inc. Founded in America, the CLINIQUE brand launched internationally (including Australia) in 1969. Applied to cosmetics, hair care products, fragrance and skin treatment, the Opponent’s products bearing the CLINIQUE brand are sold in over 200 stores across Australia (including David Jones and Myer). The Opponent’s marketing is also focused on presenting a scientific or medical image to the Australian consumer. For example, CLINIQUE consultants wear white lab coats at point of sale locations with silver badges bearing the name ‘Clinique Laboratories’.
The Opponent owns a large number of trade mark applications and registrations both nationally and abroad, which feature the word CLINIQUE as the foremost element (for example, CLINIQUE CARE, CLINIQUE WRAPPINGS, CLINIQUE MOISTURE SURGE; CLINIQUE IN TOUCH; CLINIQUE CYBERFACE, etc.).[3]
[3] ‘Van Der Merwe’ declaration, exhibit WVDM2
The sales figures relating to the CLINIQUE products and the associated promotional expenditure in Australia are confidential and I think it is sufficient to say that both sets of figures before the priority date are overwhelming. In this regard I note the following comments of Kenny J in McCormick & Co Inc v McCormick[4]:
In practice, it is commonplace to infer reputation from a high volume of sales, together with substantial advertising expenditures and other promotions, without any direct evidence of consumer appreciation of the mark, as opposed to the product.
[4] McCormick & Co Inc v McCormick [2000] FCA 1335; (2000) 51 IPR 102 (at 127).
In the evidence before me there is also evidence of consumer appreciation of the CLINIQUE trade marks. CLINIQUE was named as one of the top ten most valuable Global Brands in a report dated from May 2012. In addition, the Opponent has conducted online promotional activities on its Australian website ( and also on the social networking site, Facebook. I note that the Opponent has also won numerous beauty and skin care awards for its products in Australia.
The Opponent’s products are also prominently and frequently advertised in magazines sold in Australia (including Vogue Australia, Cosmopolitan, Instyle, Women’s Weekly, Marie Claire), on store displays and in-store promotional events.
With regard to brand extension, there is evidence that the Opponent conducts ongoing scientific research in the area of skin biology[5] and opened a “Clinique Skin Wellness Center” at Weill Cornell Medical College in New York City in January 2007. That centre, however, closed in or around June 2009.
[5] Landau 1, paragraph 37.
In 2008, the Opponent became involved in ‘Cosmoceuticals’ (described in the evidence as ‘the converging of cosmetics and healthcare’) and around that time released its CLINIQUE MEDICAL range of products. It appears that these products were only available in the United States and are not products taken orally, but are a number of cleansers and skin care treatments with medicinal properties. The link between cosmetics and pharmaceuticals for skin care is evident despite the differences in application. The Opponent has, to a certain degree, extended its brand into this area.
The aforementioned link between beauty and health care is referred to in Lauder 2. Annexed to the declaration is a 2008 report from the Kline Group entitled “Decoding the Convergence of Beauty and Healthcare”. The report discusses ‘Nutricosmetics’ which are described as ingestible products formulated and marketed specifically for beauty purposes (whether they are in pill, tablet, food or liquid form). According to the report, this area of trade is rapidly growing and some examples include collagen water as a skin care supplement drink, collagen bars, green tea with collagen, collagen yoghurt and collagen marshmallows. However, the majority of those products had been confined to Japan and Europe at the time of the report. The report indicates that in terms of global sales, 'Nutricosmetics' is a tiny industry when compared to the skin care and personal care industries.
Despite the existence of brand extension overseas in this industry, there is no indication of how popular Nutricosmetics is in Australia or whether there are any products currently on the market. The report also indicates that consumers in the US generally do not want to buy ingestible products from cosmetics companies, and gave the example of one product that was to be launched in 2008: a collaboration between the Coca Cola Company and L’Oreal comprising a tea based beverage with skin care properties. However, there is no evidence that it was launched in Australia or even internationally. I find that Australian consumers may be accustomed to seeing skin care brands used together, but they are not currently accustomed to skin care brands extending into the health foods and beverages industry.
In addition, there is no evidence to suggest that the Opponent’s CLINIQUE trade mark has ever been used in this way. The fact that other brands under the Estee Lauder portfolio (such as AVEDA and ORIGINS) offer wellness-related ingestible products (e.g. tea) does not assist the Opponent’s arguments in relation to the likelihood of confusion arising from the reputation of the CLINIQUE trade marks.
The Opponent has a substantial reputation in relation to skin care preparations, cosmetics and toiletries (soap and deodorants, etc.) but that does not extend to the particular beverages residing in class 32 of the designated goods. While it is possible for beverages and health care products to coincide, the trade mark CLINIQUE has not, in its long history within Australia been involved in this form of brand extension. Nor am I convinced that the IRDA ‘CLINIQUE LA PRAIRIE’ appearing on a bottle of fruit juice would deceive or confuse a consumer into thinking there was a trade connection with the well-known brand of the Opponent.
There is no doubt that CLINIQUE would be seen by consumers as a well-established brand in Australia and it has been that way for some time. However, the nature of the reputation must also be considered, and an overwhelming and lengthy reputation in a specific industry with little evidence of brand extension in Australia must condition consumers to associate the Opponent’s products accordingly. In other words, a substantial reputation in one industry can be a double-edged sword making it less likely for consumers to be deceived or confused, if a similar trade mark is used on quite different goods. It has been said in previous decisions from delegates of the Registrar that “Reputation can thus be a double-edged sword and may either reinforce or mitigate the effect of differences”[6] between the trade marks. Additionally, I find that “those who know of the opponent will be immunized, by the very character of their knowledge, against any deception or confusion about the connection with the applicant”[7] if the IRDA is used on the designated goods in class 32.
[6] Flight Centre Pty Ltd v World Flight Centre Pty Ltd [2003] ATMO 60 at [21].
[7] Matthew Wherrett v Holley Performance Products [2004] ATMO 9 at [21].
I find that the Opponent has demonstrated a substantial reputation in the CLINIQUE trade marks in relation to cosmetics and skin care preparations which existed at the priority date of the IRDA.

Reputation of ‘LA PRAIRIE’ in Australia

The Van Der Merwe declaration further attests to a reputation of a trade mark owned by the Opponent’s competitor, the German company Beiersdorf AG. Laboratoires La Prairie S.A. was acquired by Beiersdorf AG in 1991. Exhibited to the Van Der Merwe[8] is a brochure which provides a connection to the Holder:
Laboratoires La Prairie traces its proud heritage to the highly renowned Clinique La Prairie in Montreux, Switzerland. For more than half a century, the Clinique has been the pioneer in cellular, anti-aging treatment, sharing its unique accomplishments with thousands of visitors from around the world…
Since 1982, Laboratoires La Prairie, Switzerland has no longer been a part of Clinique La Prairie…
[8] Exhibit WVDM-7.
The Holder’s evidence also acknowledges the sale of the skin care business to Laboratoires La Prairie SA in 1982 and confirms that there is no corporate relationship between the two companies.
Mr Van Der Merwe believes (in his capacity as financial director of Estee Lauder Pty Ltd) that LA PRAIRIE products have been available for purchase in Australia since 1998 and are available in over 90 countries worldwide. LA PRAIRIE products are in the same category as the Opponent’s CLINIQUE trade marks (that is, cosmetics and skin care) and are at the premium end of the market, sold in David Jones, specialist salons and online. Total sales figures for 2009 and 2010 have been provided in the declaration, and while significant, they appear to be an estimation derived from information on a third party report.
The LA PRAIRIE products have been mentioned in newspaper articles from the Australian Financial Review, the Sunday Age, the Age, the West Australian and the Sunday Telegraph. The inclusion of the LA PRAIRIE product in those articles is (more often than not) to comment on the price tag of these luxury items.
While I am satisfied that the trade mark LA PRAIRIE had a presence in Australia as at the priority date, I am not satisfied that the demonstrated reputation was sufficiently widespread for the Holder’s use of the IRDA on the designated goods of supplements and beverages to be likely to deceive or cause confusion in Australia.

‘Likely to Deceive or Cause Confusion’

While the Holder’s evidence of reputation is largely irrelevant to the consideration of whether the use of the IRDA will deceive or cause confusion under section 60, I do note that the Holder specializes in anti-ageing treatments in Switzerland and is yet to commence trading in Australia. The claimed mineral food supplements and nutritional additives for medical purposes are therefore intended for purposes similar to the Opponent’s goods (i.e. essentially to improve the appearance of the skin). There is no indication of how the Holder intends to use CLINIQUE LA PRAIRIE in relation to ‘Mineral and aerated waters or other non-alcoholic beverages; fruit drinks and fruit juices; syrups and other preparations for making beverages’. If the IRDA is intended to be used on beverages adapted for medical purposes or to enhance health, beauty or appearance (or reduce the effects of aging) it is arguable that such goods would be more correctly classified in class 5 (where goods such as “dietetic beverages adapted for medical purposes’ reside).
As it is, I must decide whether the reputation of the Opponent’s trade marks is such that use of CLINIQUE LA PRAIRIE on non-medical beverages would be likely to deceive or cause confusion.
The word ‘Clinique’ forms the prefix of the IRDA and is important in assessing the likelihood of deception or confusion. In French, the word ‘Clinique’ means ‘clinical (adj)’ and ‘private hospital (n)’ and ‘Prairie’ means ‘meadow (n)’. It is unsurprising that the Opponent has been unable to supply any evidence of actual confusion between the trade marks in Australia, as at the time of making the declaration the Holder had only used the IRDA in Switzerland.
I find that the Opponent has established a substantial reputation in CLINIQUE such that the use of the IRDA on following designated goods would be likely to deceive or cause confusion:
Class 5: Mineral food supplements; nutritional additives for medical purposes
However, I also find that the Opponent has not discharged the onus of establishing the ground of opposition in relation to the following designated goods:
Class 32: Mineral and aerated waters or other non-alcoholic beverages; fruit drinks and fruit juices; syrups and other preparations for making beverages

Decision

Regulation 17A.34 states that:
Decision on opposition
(1)Unless the opposition proceedings are discontinued or dismissed, the Registrar must decide:
(a)to refuse protection in respect of all of the goods or services listed in the IRDA; or
(b)to extend protection in respect of some or all of the goods or services listed in the IRDA (with or without conditions or limitations);
having regard to the extent (if any) to which any ground on which the IRDA was opposed has been established.
(2)The Registrar must tell the International Bureau of his or her decision.
I direct that the protection of IRDA no. 1342372 (IR No. 1025395) be extended to Australia in respect of the following goods listed in the IRDA one month from the date of this decision:
Class 32: Mineral and aerated waters or other non-alcoholic beverages; fruit drinks and fruit juices; syrups and other preparations for making beverages
The IRDA is refused extension of protection to Australia in relation to the goods in class 5:
Class 5: Mineral food supplements; nutritional additives for medical purposes
If the Registrar is served with a notice of appeal on or before that time, I direct that protection shall not occur until the appeal is withdrawn or discontinued. Otherwise I direct that extension of protection of the IRDA be subject to any orders of the court.

Costs

Both parties have enjoyed some measure of success. I find it appropriate that each party bear their own costs of these proceedings.

Heath Wilson
Hearing Officer
Trade Marks Hearings
28 October 2013

[2013] ATMO 87

28 October 2013

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Intellectual Property

Commercial Law

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