Companie Des Montres Longines, Francillon SA (Longines Watch Co Francillon Ltd) v Voxson Pty Ltd

[2011] ATMO 82

TRADE MARKS ACT 1995

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

Re:Opposition by Companie des Montres Longines, Francillon SA (Longines Watch Co Francillon Ltd) to registration of trade mark application 1210749(18) – LONGINES QUALITY LUGGAGE - filed in the name of Voxson Pty Ltd.

Delegate:

Iain Thompson

Representation:

Opponent: Margaret Ryan of Phillips Ormonde Fitzpatrick

Applicant: Katrina Chambers of Flower and Hart

Decision:

2011 ATMO 82

s52 opposition - s60 – s42(b) – reputation of opponent’s trade mark, brand extension, brand extension amongst other quality watch makers - opposition established.

Background

1. Voxson Pty Ltd (‘the applicant’) of Eagle Farm, Brisbane, has applied under the Trade Marks Act 1995 (‘the Act’) to register a trade mark, current details of which appear below:

Application No: 1210749

Priority Date:  16 November 2007

Goods:Class 18: Articles of luggage; articles of luggage being bags; elasticised cords for luggage; elasticised straps for luggage; luggage; luggage bags; luggage for use by cyclists; luggage for use with motorcycles; luggage label holders; luggage labels (tags) of leather or imitation leather; luggage straps; luggage tags; portable bags (luggage); portable boxes (luggage); portable containers (luggage) having internal shock relieving means for the contents; travel luggage; trunks (luggage); leather travelling suitcases; suitcase handles; suitcases; handles for trunks; travelling trunks; trunks (luggage)g; airline travel bags; articles of luggage being bags; athletics bags; bag covers; baggage; bags (envelopes, pouches) of leather, for packaging; bags (not in the nature of sacks) for holding laundry; bags for campers; bags for climbers; bags for clothes; bags for clothes pegs; bags for shaving kits; bags for toiletry kits; bags for use in sports for carrying sports clothing; bags made of imitation leather; bags made of leather; beach bags; belt bags; bicycle bags (saddle bags); boston bags; camera bags (other than adapted or shaped to contain a camera); camping bags; carrying bags (other than disposable carrier bags); casual bags; changing bags; clutch bags; cosmetic bags (not fitted); cosmetics bags (not fitted); courier bags; cricket bags (other than adapted); diaper bags; diplomatic bags; duffel bags; evening bags; flight bags; game bags (hunting accessory); gardening bags; garment bags; garment bags for travel; hat bags; jewellery bags (empty); knitting bags; laundry bags; leaflet bags for use by the person delivering; leather bags; luggage bags; make-up bags; medical bags for apparatus and instruments (not adapted or fitted); money bags; nappy bags (other than bags for the disposal of nappies); net bags for shopping; nurses bags; overnight bags; pilots’ bags; portable bags (luggage); pouches (bags); shaver bags (not shaped); shoe bags; shopping bag handles; shopping bags; shopping carts (wheeled shopping bags); shoulder bags; shoulder bags for use by children; ski boot bags (not fitted or shaped); sling bags; sponge bags (empty); sport bags, other than adapted (shaped) to contain specific sports apparatus; suit carriers being travelling bags; tennis bags, other than adapted (shaped) to contain a racket; tennis racket bags (other than adapted or shaped to contain a racket); toilet bags; toiletry bags; tote bags; towelling bags; travel baggage; travel bags; travel bags made of plastic materials; travelling bags; two-wheeled shopping bags; umbrella bags; waist bags; wash bags; weekend bags; wheeled shopping bags; work bags

Trade Mark:  LONGINES QUALITY LUGGAGE

(‘the opposed application’)

1. The application was examined[1] and subsequently advertised as accepted for possible registration in the Australian Official Journal of Trade Marks on 20 March 2008.

   [1] Section 31 of the Act applies.

2. On 17 June 2008, Compagnie des Montres Longines, Francillon SA (Longines Watch Co Francillon Ltd) (‘the opponent’) of Saint-Imier, Switzerland, filed Notice of Opposition (‘the Notice’) to the registration of the trade mark.

3. The Notice is framed in broad terms and includes all of the available grounds of opposition including those which were subsequently argued at a hearing of the opposition. 

4. The hearing was before me as a delegate of the Registrar of Trade Marks in Canberra on 23 June 2011.  Margaret Ryan of Phillips Ormonde & Fitzpatrick, Patent and Trade Mark Attorneys represented the opponent.  Katrina Chambers of Flower and Hart represented the applicant.

The Evidence

1. The parties have served and filed their respective evidence in support, evidence in answer, evidence in reply and further evidence.  This comprises:

Declarant	Position	Date Made	Exhibits
Evidence in Support Walter Von Känel	President of opponent	25 March 2009	WVK-1 - WVK-12
Anita Joy Brown	Legal Practitioner	6 April 2009	AJB-1 - AJB-5
Evidence in Answer Lucas Longginou	Chairman of the applicant	22 September 2009	LL-1 - LL-6
Christine Lyn Hadley	Registered Trade Mark Attorney	24 September 2009	CLH-1 - CLH-9
Evidence in Reply Kristine Van Ruiten	Private Security License (Investigator)	20 April 2010	KVR-1 - KVR-4
Amelia Michael	Brand Manager for Longines Australia	24 June 2010	AM-1 - AM-4
Further Evidence Lucas Longginou	Chairman of the applicant	27 September 2010
Kristine van Ruiten	Private Security License (Investigator)	8 October 2010
Anita Joy Brown	Registered Trade Mark Attorney	21 June 2011
Margaret Mary Ryan	Consultant to Phillips Ormonde & Fitzpatrick	21 June 2011	MMR-1 – MMR8
Christine Lyn Hadley	Registered Trade Mark Attorney	21 June 2011	CLH-1 – CHL-2

Onus

1. In Pfizer Products Inc. v. Karam [2006] FCA 1663; (2007) 70 IPR 599; (2007) AIPC 92-232, after reviewing the decided authorities, and in particular in considering whether such matters should be decided in summary manner or only on clear proof, Gyles J said of the onus in trade mark oppositions (at paragraph 26):

   I am faced with the clear words of the statute, on one hand, and the opinions of various judges, on the other. There is no binding Full Court authority. I cannot find any instance where a single judge has actually applied the higher standard. In my opinion, in this case, comity does not demand that I depart from my view as to the meaning of the statute. ‘The fundamental responsibility of a court when it interprets a statute is to give effect to the legislative intention as it is expressed in the statute’ per Mason J in Babaniaris v Lutony Fashions Pty Ltd [1987] HCA 19; (1987) 163 CLR 1; cited with approval by Mason CJ, Wilson, Dawson, Toohey and Gaudron JJ in John v Federal Commissioner of Taxation [1989] HCA 5; (1989) 166 CLR 417 at 439. I will, therefore, approach the matter on the basis that the opponent has to establish a ground of opposition, although not clearly establish such a ground, whether in a summary fashion or otherwise.

2. The opponent bears the onus of establishing one or more grounds of opposition on the balance of probabilities.  See also Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891; (2009) 82 IPR 13; (2009) AIPC 92-355 at [22] to [26].

3. I will accordingly decide this matter on the balance of probabilities.

The Grounds

1. The main thrust of the opponent’s evidence and the submissions of Ms Ryan for the opponent at the hearing go to section 60 and subparagraph 42(b) of the Act — that the use of the opposed trade mark would, in terms of section 60, confuse or deceive because of the reputation of the opponent’s trade mark. Or, (as its use is submitted by the opponent be misleading or deceptive) the use of the opposed trade mark would be contrary to law by virtue of being in breach of section 52 and of the Trade Practices Act 1974[2] (‘the TPA’).

   [2] As it was at the priority date, now section 18 of the Australian Consumer Law (Schedule 2 of the Competition and Consumer Act2010).

2. Accordingly, I will initially discuss the evidence and the sections 60 and 42(b) grounds and, if those sections are not established by the opponent, then discuss the other ground argued by Ms Ryan for the opponent under section 62A of the Act.

Sections 42(b) and section 60

Legislation

1. Subparagraph 42(b) and section 60 of the Act respectively (and relevantly) provide:

   42Trade mark scandalous or its use contrary to law

   An application for the registration of a trade mark must be rejected if:

   […]

   (b)its use would be contrary to law.

   60Trade 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.

   Note:For priority date see section 12.

2. Section 52(1) of the TPA provides:

   A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

3. In terms of the decision in Advantage-Rent-A-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683; (2001) 52 IPR 24; (2001) AIPC 91-724, I am to consider wheter the use of the opposed trade mark by the applicant “would” not “could” be contrary to law.

The opponent’s evidence in support

1. The opponent has a long history and is the oldest Swiss watchmaker extant.  In the words of Mr Känal:

   The opponent traces its origins back to 1832 when Auguste Agassiz of Neuchatel arrived in the village of Saint-Imier in Switzerland and soon after founded the company Raiguel Jeune & Cie that is, today known as Compagnie des Montres Longines, Francillon S.A. The opponent’s predecessor adopted the LONGINES trade mark in 1867 when they built a watch factory on the banks of the river La Suze in Saint-Imier. “Longines”, was the name of the plot of land that was purchased and in the local French dialect it means “long meadow”.

2. Mr Känal states, and the applicant does not dispute:

   The opponent’s LONGINES trade mark first appeared on the dials of watches in 1867.

   In 1893, the opponent’s predecessor Ernest Francillon & Co. sought a trade mark registration for the LONGINES trade mark from the World Office for Intellectual Property. The LONGINES trade mark is the world’s oldest unchanged and still-active trade mark.

3. I understand that the above claims to refer to both the trade mark LONGINES and the trade mark which contains both the word LONGINES and the graphical device of a wing hourglass which appears below:

1. Although it is not relevant to this decision,[3] I note that both forms of the opponent trade marks, above, are registered in Australia as follows:

Registration No:              83913

Priority Date:  21 June 1945

Goods:  Class 14: Horological instruments,

Trade Mark:  LONGINES

Registration No:              268010

Priority Date:  4 May 1973

Goods:  Class 14: All goods in Class 14

Trade Mark:  

[3] In terms of both subparagraph 42(b) and section 60 of the Act, it is not a requirement that an opponent’s trade mark be registered in order to found the ground.

1. Mr Känal continues:

   The opponent first commenced use of its LONGINES trade mark in Australia on 23 September 1891 in relation to watches. Use of the LONGINES trade mark in Australia has been continuous since that date. Now shown to me and marked Exhibit WVK-3 is a copy of the manuscript page from the opponent’s archives dated September 23, 1891 detailing the sale of goods bearing the LONGINES trade mark sent to Mr Vincent E. Nesbit, Perth, Australia and a copy of an English translation of this manuscript page.

2. The opponent’s sales of watches in Australia have been substantial – especially when considering that those watches are an ‘up-market’ and relatively expensive item which typically retails within the $1000 to $3500 range.  Mr Känal states that the opponent has sold several hundreds of thousands of watches in Australia in the eight years before the priority date through 237 authorised Australian retailers.

3. I remark that, supposing the usual sale price of a LONGINES watch to be around $1800, averaging out these figures reveals annual sales of about several tens of thousands of watches and a total annual retail value in well in excess of $50 million within Australia.

4. Confidential sales figures are also supplied by the opponent as are the amounts expended on advertising and promotion of its goods bearing the trade mark.  I regard the advertising and promotional figures as being commensurate with the revenue figures.

5. Concerning the advertising and promotion in relation to goods sold under the opponent’s trade mark in Australia, Mr Känal states:

   The opponent has a long history of involvement and sponsorship in sports timekeeping worldwide, including in Australia. At most events, where the opponent has responsibility for timekeeping the LONGINES trade mark is displayed for promotional purposes. Often events that the opponent timekeeps for, such as the Sydney 2000 Olympics are broadcast to large television audiences resulting in significant public exposure of the opponent’s LONGINES trade mark.  The opponent was the official timekeeper at the Formula One Grand Prix in Australia in 1963 and in Monaco in 1967. The opponent was also a sponsor of the Ferrari racing team for Formula One during the 1980s and was the official timekeeper at all Formula One Grand Prix races from 1982 to 1992, including the Formula One Grand Prix races held in Australia during that decade. The opponent was also the official timekeeper at the 1990 Australian Motorcycle Grand Prix.

   To mark its 125 years of timekeeping in 2003, the opponent edited a book, 125 Years of Longines Timekeeping. Now shown to me and marked Exhibit WVK-4 is a copy of this publication. It details the history of the opponent’s involvement in sports timekeeping and pages 108-127 of this publication contain a summary of the opponent’s timekeeping activities which involve the use of timepieces bearing the LONGINES trade mark.

   The opponent’s timing system was used to measure the world speed record achieved by Donald Campbell on Lake Eyre in Australia in 1964. This event is specifically referred to on page 36 of the publication 125 Years of Longines Timekeeping forming Exhibit WVK-4.

   The opponent has also been the official timekeeper for the Federation Internationale de Gymnastique since 1989. In particular, the opponent was timekeeper at the 38th Artistic Gymnastics World Championships in Melbourne, Australia in 2005 and for the World Gymnastics Championships (artistic discipline) held in Brisbane in 1994. The opponent was also the official timekeeper for the 2002 Spring Racing Carnival in Melbourne and Sydney, Australia including the Melbourne Cup and was an official partner of the Sydney 2000 Olympics. It is the official timekeeper for the alpine skiing World Cup of the Federation International de Ski and will be the official timekeeper for this organisation’s races during the 2009-2010 skiing season.

   The opponent is also the official timekeeper for various short track ice speed skating events, show jumping and skiing events and has been the official timekeeper of horse races at the Royal Ascot course in the United Kingdom since 2007. The opponent was the official timekeeper of the international tennis tournament, The French Open at Roland Garros in Paris, France in 2007 and 2008.

   The opponent is also the official partner of the International Archery Federation (FITA) Archery World Championships and FITA Archery World Cup for the next two years.

6. Mr Känal attests to the supply of certain leather and other goods to its distributor in Australia:

   In Australia today, the LONGINES trade mark is applied to watches as well as a range of goods including writing instruments, leather goods, various luggage items, pocket knifes, plates, clothes, umbrellas, scarves, ties, clothing and headgear and sunglasses.  Now shown to me and marked Exhibit WVK-5 is an order form for these items.

   Now shown to me and marked Confidential Exhibit WVK-6 are copies of invoices dated from 2004 to 2008 in relation to the supply of these promotional items bearing the LONGINES trade mark to The Swatch Group (Australia) Ltd, the opponent’s authorised distributor in Australia. I am unable to provide details of the numbers of promotional items distributed to customers throughout Australia to date or during the 2004-2008 period.

7. Mr Känal observes that other watchmakers including Omega, Mont Blanc-Simplo and Cartier (‘the watchmakers’) have ‘brand extended’ into a range of other goods which include ‘leather goods’ and ‘luggage.’  Mr Känal supports this claim by exhibiting extracts from the Australian register of trade marks, showing registrations for the watchmakers in a range of goods classes which include class 18 where ‘leather goods’ and luggage occur within the International (Nice) Classification of Goods and Services.  Mr Känal also exhibits printouts from the Internet websites of the watchmakers showing their respective trade marks used in relation to ‘leather goods’ and ‘luggage’.

8. The declaration by Anita Brown (‘Brown’) goes to support the ground under section 62A and shows applications for trade mark registration made either by the applicant or by companies connected with Mr Longginou. I will discuss that declaration later together with the declaration of Margaret Ryan should it become relevant to the grounds argued at the hearing.

The applicant’s Evidence in Answer

1. Mr Longginou refers to the Hadley declaration and states:

   I selected the word LONGINES as a trade mark in 1983 because it is a derivative of my family name, LONGINOS. Exhibited hereto and marked “LL-3” are copies of extracts from my Mother and Father’s passports and a copy of my Mother’s certificate of Australian Citizenship, showing my family name

2. I assume that Mr Longginou’s motivations for selecting the trade mark LONGINES remain unaltered and will address these, below.

3. Mr Longginou states:

   In 2008 the applicant’s board decided to expand its business activities by licensing its patents and its trade marks. As the applicant has an extensive knowledge of Chinese manufacturers, it was decided that the applicant should expand outside of the electrical industry to include the importation of high quality leather goods.

   As the original LONGINES mark from 1983 […] had not been used on the applicant’s class 9 goods because of the problems encountered at the examination stage, I decided to use that trade mark as a trade mark for luggage, as it was always the intention of the applicant to diversify outside the electrical industry.

   The applicant is now in a clear position to proceed with its expansion into high quality leather goods, as it has contacts for the manufacturing and marketing of such goods. It is the applicant’s intention to sell its leather bags to stores such as Harvey Norman, to be used with high quality computers.

   On 16 November 2007 I filed an application for the trade mark LONGINES QUALITY LUGGAGE in class 18.

   No objections were raised and Application No. 1210749 was immediately accepted for registration by the Trade Mark Examiner, which leads me to believe that the registration of the applicant’s trade mark is unlikely to pose a risk of confusion or deception with the opponent’s trade marks.

4. Mr Longginou also states his belief that:

   The opponent may have some reputation in Australia only in relation to “watches” in class 14, and not in relation to class 18 goods.

   There is no question in my mind that “watches” are very different to leather goods and luggage in class 18.

   I do not believe that the opponent’s Australian registrations for “watches” (the only products of the opponent being sold in Australia) should prevent the registration of the applicant’s application for LONGINES QUALITY LUGGAGE in class 18.

1. Mr Longginou also observes that some identical trade marks are registered in Australia in the names of different owners in many different classes of goods and services.  He states:

   For example, the worldwide, famous electronics company “Pioneer” is the registrant of class 9 trade marks for PIONEER covering audio equipment. These registrations coexist with other registrations for PIONEER in goods classes 5, 6, 10, 12, 19, 22, 28 and 29, in the names of different owners.

   Exhibited hereto and marked “LL-5” is an extract from IP Australia’s Trade Mark database showing various PIONEER trade marks coexisting on the Trade Marks Register in the names of different owners, in different classes.

   As a second example, the worldwide, famous watch company Omega S.A is the registrant of various trade marks for OMEGA in class 14. Again, these registrations coexist with other registrations for OMEGA in classes 1, 2, 4, 7, 9 11, 12 15, 19, 20, 21, 25, 28, 36, 37 and 42.

2. Mr Longginou also states that he has conducted an informal survey of three outlets which are stated in the evidence in support to sell the opponent’s watches and confirmed to his satisfaction that these outlets do not sell luggage that bears the opponent’s trade mark LONGINES.

Evidence in reply

1. Ms van Ruiten is a licensed private investigator who attests that she conducted a similar ‘survey’ of outlets to that done by Mr Longginou with results which were more equivocal.  She also states:

   Now shown to me and marked Exhibit KVR-1 is a copy of a Thomas Jewellers catalogue dated January 2010 advertising watches on page 11 and bags and luggage on page 13.

   On 3 March 2010, I visited the F1RST Tax and Duty Free store at Melbourne International Airport Departures Landside and identified LONGINES watches and leather bags[4] for sale within 2-3 metres of each other. I took photographs inside the store and now shown to me and marked Exhibit KVR-2 are copies of these photographs.

   On 2 March 2010, I visited the JR Duty Free Store in Swanston Street, Melbourne. I identified LONGINES watches and leather bags[5] for sale within 2-3 metres of each other. I took photographs inside this store and now shown to me and marked Exhibit KVR-3 are copies of these photographs.

   On 3 March 2010, I visited the David Jones Store in Bourke Street, Melbourne and identified LONGINES watches and leather bags[6] for sale within metres of each other. I took photographs inside this store and now shown to me and marked Exhibit KVR-4 are copies of these photographs.

   [4] Ms van Ruiten’s subsequent declaration clarifies that the luggage referred to does not bear the trade mark LONGINES.

   [5] Ms van Ruiten’s subsequent declaration clarifies that the luggage referred to does not bear the trade mark LONGINES.

   [6] Ms van Ruiten’s subsequent declaration clarifies that the luggage referred to does not bear the trade mark LONGINES.

2. Ms Michael clarifies some of the Känal declaration as regards the latter’s statement that writing instruments, leather goods, various luggage items, pocket knifes, plates, clothes, umbrellas, scarves, ties, clothing and headgear and sunglasses bearing the LONGINES trade mark have been sent to Australia.  Ms Michael is Brand Manager for Longines Australia and is employed by The Swatch Group (Australia) Pty Ltd. The Swatch Group (Australia) Pty Ltd is part of the Swatch Group Ltd group of companies.  The opponent is a wholly owned subsidiary of the Swatch Group Ltd.  Ms Michael states:

   In paragraph 48 of the Hadley Declaration, the declarant states she does not consider the order form titled “Longines Promotional Collection 2007” to be evidence of sales of class 18 goods in Australia because there is nothing in the order form to indicate it was made available for Australian consumers to order goods, or that the opponent was able to or willing to deliver its goods to Australian consumers. At paragraph 49, of the Hadley Declaration, the declarant also refers to the fact that the fax number on the form is for Switzerland and states that it is impossible to tell whether the order form reached Australian consumers.

   The order forms are sent to The Swatch Group (Australia) Pty Ltd from Switzerland by the opponent. The Swatch Group (Australia) Pty Ltd then uses the order form to place an order with the opponent in Switzerland. The promotional products ordered are delivered to Australia and are distributed to the opponent’s authorised stockists in Australia based on their requirements. The order form is not used externally to the opponent or The Swatch Group (Australia) Pty Ltd and the products featured in the order form are not sold to consumers. However, the various products featured in the order form are from time to time offered as consumer incentives for example, as part of a ‘gift with purchase’ promotion whereby purchasers of the opponent’s goods bearing the LONGINES trade mark would receive a free product. The goods may also be used by retailers as a gift to consumers generally. Products which are leather goods have previously been ordered by The Swatch Group (Australia) Pty Ltd for this purpose.

Further Evidence

1. Mr Longginou’s further evidence goes in the main to criticise the declaration of the private investigator, Ms van Ruiten.  He states:

   It is possible to interpret the contents of paragraphs 9 and 10 of the van Ruiten Declaration in two ways, as follows.

   At paragraph 9 of her Statutory Declaration, the Deponent states:

   On March 2010, I visited FIRST Tax and Duty Free store at             Melbourne International Airport Departures Landside and identified      LONGINES watches and leather bars for sale within 2-3 metres of             each.

   This paragraph can be read as:

   a.           FIRST Tax and Duty Free Store sells watches and leather   bags under the LONGINES brand; or

   b.           FIRST Tax and Duty Free Store sells LONGINES watches   near the leather bags of other brands, but not under the   LONGINES brand.

   The first reading, (a), is misleading and incorrect. The opponent does not make leather bags. However, from the opponent’s evidence, it appears as though the Deponent has been into a department store and witnessed LONGINES watches and LONGINES bags.

   To clarify the accuracy of this evidence, I contacted the organisation that the Deponent refers to as “FIRST Tax and Duty Free Store” in Melbourne on Tuesday, 27 April 2010 at 1.15pm (telephone [phone]). I received an answering machine message.

   I then contacted the same organisation in Brisbane (telephone [phone]) and spoke to a woman whose name was Flossie.

   I asked Flossie if FIRST Tax and Duty Free stocked leather bags. Flossie said they sold GUESS, LONGCHAMP and GIVENCHY brand leather bags.[7]

   [7] According to Mr Longginou, Flossie also stated that her store does not stock or sell LONGINES trade marked luggage.

Discussion of the grounds

1. The legal representatives of the parties were in general agreement about the principles to be applied.

2. In terms of section 60 of the Act, the opponent must establish to my satisfaction that the trade mark on which it relies has a reputation such that the use of the opposed trade mark on, or in relation to, the goods in respect of which registration is sought would be likely to deceive or cause confusion.

3. In terms of section 52 of the TPA, the opponent must establish to my satisfaction that the trade mark, or name, on which it relies has a reputation such that the use of the name or trade mark by the applicant on or in relation to the goods in respect of which registration is sought would mislead or deceive. As observed by Hill J in Re Equity Access Pty Limited v Westpac Banking Corporation and Westpac Savings Bank Limited and Challenge Bank Limited [1989] FCA 506; 16 IPR 431 at paragraph 37:

   While it might be thought ironical that an Act to make trade and commerce more competitive might be used to protect the monopoly in a name (cf Parkdale Custom Built Furniture Pty Ltd v. Puxu Pty Ltd [1982] HCA 44; (1981-2) 149 CLR 191) and that the same Act in Part V, designed to protect consumers, could provide a statutory cause of action by one trader against another (cf Hornsby Building Information Centre Pty Ltd v. Sydney Building Information Centre Ltd [1978] HCA 11; (1977-8) 140 CLR 216), it is now well established that by the combined effect of s.52 and s.80 of the Act a trader having a distinctive reputation in a name may enjoin another from engaging in misleading and deceptive conduct by the use of that name.

4. I note that section 60 of the Act and section 52 of the TPA specify different values or thresholds which are, respectively, ‘confuse or deceive’ and ‘mislead or deceive’ and that the concepts ‘confuse’ and ‘mislead’ are distinct. In Parkdale Custom Built Furniture Pty. Limited v Puxu Pty Limited [1982] HCA 44; (1982) 42 A.L.R. 1 Gibbs C.J. said (at page 6):

   The words of s. 52 require the court to consider the nature of the conduct of the corporation against which proceedings are brought and to decide whether that conduct was, within the meaning of that section, misleading or deceptive or likely to mislead or deceive . . . . . The words “likely to mislead or deceive”, which were inserted by amendment in 1977, add little to the section; at most they make it clear that it is unnecessary to prove that the conduct in question actually deceived or misled anyone. In McWilliams v. McDonalds [1980] FCA 159; (1980) 33 A.L.R. 394 it was rightly held by Smithers J. and by Fisher J. that to prove a breach of s. 52 it is not enough to establish that the conduct complained of was confusing or caused people to wonder whether two products may have come from the same source, and that Southern Cross Refrigerating Co. v. Toowoomba Foundry Pty Ltd (1954) 91 C.L.R. 592, a decision on the Trade Marks Act 1905 (Cth) as amended, is distinguishable: I need not add to what their Honours said on this subject (33 A.L.R.) at 397-8 and 412-3. I agree too with those learned judges that the court must decide objectively whether the conduct is misleading or deceptive or likely to mislead or deceive, and that evidence that members of the public have actually been misled is not conclusive: see at 399-400 and 413-4. I would add that evidence that members of the public were misled, not by any conduct of the defendant, but by other circumstances for which the defendant was not responsible, would be quite irrelevant.”

   In the same case Mason J. said (p. 15):-

   “. . . the onus is on the plaintiff to show that the conduct is likely to mislead or deceive. Therefore conduct which merely causes some uncertainty in the minds of relevant members of the public does not breach s. 52.”

5. The expression ‘likely to mislead’ within section 52 of the TPA might be seen as going to the motives of the owner of the opposed name or trade mark. However, this is not so since the use of such a sign might be both literally true and ‘misleading or deceptive’ at the same time. In Hornsby Building Information Centre Pty. Limited v. Sydney Building Information Centre Limited [1978] HCA 11; (1978) 140 C.L.R. 216 Stephen J said at page 227:

   …. what the Hornsby Centre has done is, in a sense, no more than to use its own corporate name in association with its activities. No doubt the meaning of the statutory prohibition which s. 52 (1) enunciates must be gained from the terms of the sub-section itself; but nothing in those terms suggests that a statement made which is literally true, i.e. that the centre at Hornsby is conducted by Hornsby Building Information Centre Pty. Ltd. may not at the same time be misleading and deceptive. It clearly may be. To announce an opera as one in which a named and famous prima donna will appear and then to produce an unknown young lady bearing by chance that name will clearly be to mislead and deceive. The announcement would be literally true but none the less deceptive, and this because it conveyed to others something more than the literal meaning which the words spelled out. Thus, in passing off, a newly incorporated defendant company may not use, in its newly established business, its true corporate name if it be deceptively similar to that of a plaintiff with an established reputation (Fine Cotton Spinners and Doublers’ Association Ltd. v. Harwood Cash & Co. Ltd. (1907) 2 Ch. 184, at p. 190). What has been said of passing off actions applies equally in the present case; as Buckley L.J. remarked in John Brinsmead & Sons Ltd. v. Brinsmead (1913) 30 R.P.C. 493, at p. 506, a statement which is literally true and accurate may nevertheless carry with it a false representation. Lord Morris expressed much the same notion in Parker-Knoll Ltd. v. Knoll International Ltd. (1962) R.P.C. 265, at p. 279. The same will apply in relation to s. 52 (1).”

6. Thus Mr Longginou’s explanation that he wishes to register the opposed trade mark because it is a derivative of his family name is irrelevant to my considerations under these grounds.

7. I will further discuss whether the use of the opposed trade mark by the applicant in relation to the goods in respect of which registration is sought would mislead or deceive, or confuse or deceive, below.

Reputation of Opponent’s Trade Mark

1. As concerns ‘reputation’ of a trade mark, in McCormick & Company Inc v McCormick [2000] FCA 1335, (‘McCormick’) Kenny J said, at 81:

   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”.

   Does the evidence establish that in Australia before 9 March 1992 the  McCormick & Co marks were recognised by the public generally and, because of that, the use by Mary McCormick of her marks would be likely to cause the public confusion, as for example, by the public’s mistakenly attributing a business connection between the two or attributing her product to the company?

2. Kenny J also approved of my analysis of the word ‘reputation’ which appeared in an earlier decision.  In McCormick she said at paragraph 85:

   It may be correct to say, as counsel for Mary McCormick did, that the volume of the company’s sales does not directly establish that a significant number of people held the McCormick & Co marks, as distinct from the company’s products, in favourable regard. It does not follow, however, that the volume of sales and promotional expenditures are irrelevant. As Hearing Officer Thompson observed in Hugo Boss AG v Jackson International Trading Co Kurt D Bruhl GmbH & Co KG (1999) 47 IPR 423 (“Hugo Boss”) at 436:

   [I]t is true that the assessment of the reputation of a trade mark goes far beyond mere examination of sales or turnover of goods sold under that trade mark and contemplation of the advertising and promotional figures.

   As regards a trade mark, its reputation derives both from the quantum of sales under that mark and also the esteem, or image, projected by that trade mark. The quantum of sales, advertising and promotion contributes to the `recognition’ component of the trade mark’s reputation. The credit, image and values projected by a trade mark attaches to the `esteem’ component of the reputation as do the public events and other trader’s marks with which [the] owner of the trade marks in question chooses to associate the trade marks via sponsorships, cross-promotions, `contra deals’ and so forth.

   It follows that a trade mark used in relation to goods with comparatively low sales may have a high and strong reputation by virtue of the high credit or esteem in which it is held or, conversely, that a trade mark which has very high sales may have a strong reputation notwithstanding the lack of esteem that attaches to it. The particular popular images, or sets of values, that attach to the trade mark are also, therefore, important parts of the reputation of the trade mark and may be as strong an associative force in the minds of the public as the association of the trade marks with the goods or services themselves.

3. Kenny J continued by saying:

   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: see, e.g., Isuzu-General Motors Australia Ltd v Jackeroo World Pty Ltd (1999) 47 IPR 198; Marks & Spencer plc v Effem Foods Pty Ltd (2000) AIPC 91-560; Photo Disc Inc v Gibson (1998) 42 IPR 473; and RS Components Ltd v Holophane Corp (1999) 46 IPR 451. This Court has followed this approach as well, acknowledging that public awareness of and regard for a mark tends to correlate with appreciation of the products with which that mark is associated, as evidenced by sales volume, amongst other things. Thus, in Toddler Kindy Gymbaroo Pty Ltd v Gymboree Pty Ltd [2000] FCA 618 (“Gymboree”), Moore J accepted at [94] that the applicant had established a reputation for the purposes of s 60 solely on the basis of use and promotion of the relevant mark. Another example of this approach is Nettlefold Advertising Pty Ltd v Nettlefold Signs Pty Ltd (1997) 38 IPR 495 (“Nettlefold”), in which Heerey J relied upon the public visibility of the applicant’s marks over approximately two decades as well as a $100,000 promotional campaign in finding that a reputation for the purposes of s 28 of the 1955 Act existed.

4. The trade marks of the opponent which I am considering here are both the LONGINES (word) trade mark and the LONGINES (device) trade mark, the latter of which incorporates the graphic of the ‘winged hourglass’.

5. The applicant has argued that the opponent does not use its LONGINES (word) trade mark in relation to its goods in Australia – hence, the submission goes, if a trade mark of the opponent has a reputation it is the LONGINES (device) trade mark.  However, the evidence shows that the opponent uses its LONGINES (word) trade mark in conjunction with other words (with no device) to designate the different models of watches that it sells.  For example, the opponent uses the trade marks LONGINES DOLCEVITA, LONGINES PRIMALUNA and THE LONGINES MASTER COLLECTION in relation to its watches.  In common to these trade marks is the word LONGINES.  It is inevitable that the trade marks (either with the device or with other words) will be identified, recalled, and requested with principal reference to the word LONGINES as the brand identifier.  Additionally, (and without reflecting on the distinctiveness of the device) the primary impact of the opponent’s LONGINES (device) trade mark is as the word – it is doubtful, in my consideration, that most members of the public would realise that the device is a winged hourglass and recall it in order to request or identify the goods they stopped and looked at it quite closely.

6. The opponent’s trade mark LONGINES has been well advertised and promoted, not only through more traditional channels such as advertising in magazines, but also through the sponsorship or timing of prestigious sporting events.  The sales figures in relation to goods sold under the trade mark are quite substantial and the advertising figures are respectable.

7. Ms Chambers submitted that the opponent’s advertising figures in relation to its trade mark were not large.  As the figures are confidential, it is difficult to describe them other than as being ‘respectable’, as I have done.  But I remark (as I did in Hugo Boss, above) that reputation may arise in differing ways: for example, I have never consciously observed an advertisement for a Rolls Royce® motor car in a magazine or newspaper, much less on television or on radio and yet the reputation of the ROLLS ROYCE trade mark has arisen seemingly despite the lack of extensive advertising in such media.  In Hugo Boss I referred to both the quantum of sales and of advertising by which a reputation might be gauged as well as the credit, image and values projected by a trade mark which attaches to public recognition of the ‘esteem’ component of the reputation and the public events which the owner of the trade mark in question chooses to associate the trade mark via sponsorships, cross-promotions, ‘contra deals’ and so forth.  It is my assessment that the LONGINES trade mark falls into this category.

1. In my estimation, the opponent’s LONGINES trade marks have a strong reputation in relation to its watches in Australia and are associated with prestige and quality.

Brand Extension

1. Brand extension is a widespread marketing device which has been commented on by the Australian Courts.[8]  As Ms Ryan submitted, the phenomenon of brand extension was explained by the Registrar’s Delegate Mrs Skivington in General Motors Corporation v Nicholls [2003] ATMO 59 at paragraph 25 as follows:

   Trade marks are frequently promoted as lifestyle choices and traders seek to protect and strengthen their trade marks by extending the brand, often through licensing programs, from a limited range to a diverse range of items to suit the image that they wish to promote. Trade marks also command considerable customer loyalty so that traders see obvious commercial advantages in using their known trade marks on altogether new product categories. A known brand brings with it recognition, confidence, and an expectation of a certain quality. It is a vehicle for creating an emotional bond with the consumer. There is also less risk and expense to the trader in attaching an existing brand name with an established reputation to a new product than there is to developing a new trade mark. Consumers will have a natural expectation of quality in a new product bearing a known trade mark.

   [8] In Campomar Sociedad, Limitada v Nike International Limited (2000) 202 CLR 45; (2000) 46 IPR 481; (2000) AIPC 91-540 at 87-88, paragraph 107, the High Court found that Campomar had engaged in misleading and deceptive conduct by selling a fragrance called NIKE SPORTS FRAGRANCE. Nike had built up a significant reputation in Australia for athletic footwear and sports clothing but had not sold perfumes or cosmetics.

2. The evidence gives examples of other manufacturers of quality watches that have extended their brands into other goods including luggage and leather goods of the types in respect of which registration of the opposed trade mark is sought.  These other examples include:

   •         Montblanc — watches and leather goods including various bags.

   •         Omega — watches, fine jewellery, fine leather including wallets and bags.

   •         Bvlgari — watches, jewels, fragrances, leather goods including    handbags, briefcases and luggage, small leather goods, belts and leather bracelets, ties and scarves, eyewear, hotels and resorts.

   •         Cartier — watches, jewellery, leather goods including bags, small              leather goods, briefcases, diaries and belts, accessories, fragrances.

3. Ms Chambers referred me to several decisions of delegates of the Registrar of Trade Marks where a ground under section 60 had not been established where ‘brand extension’ had been argued. However, it is apparent that it is apparent that in each instance decisions are made with consideration to variables such as the norms in the trade, evidence of whether the opponent and other similar traders had branded extended, the reputation of the opponent’s trade mark, and other idiosyncrasies of the particular circumstances of the case and the likely perceptions of the ordinary consumers in the light of these variables. Each case turns on its own situation although the rules which are applied are the same.

4. Curiously, Mr Longginou refers in his further evidence to LONGCHAMP and GIVENCHY as selling luggage (as reported by Flossie of FIRST Tax and Duty Free Store).  Givenchy is a perfumer who I am led by Mr Longginou’s evidence to infer has brand extended into luggage; and, to my knowledge, Longchamp, a luggage maker, has brand extended in a range which includes umbrellas, belts, scarves and computer memory sticks.

The Tests

1. I adapt the words of French J from Registrar of Trade Marks v Woolworths [1999] FCA 1020; (1999) 45 IPR 411; (1999) AIPC 91-499, at paragraph 50 applied only to the issue of confusion or deception (ie, with references to ‘deceptive similarity’ of trade marks redacted)[9]:

   A trade mark is likely to cause confusion if the result of its use will be that a number of persons are caused to wonder whether it might not be the case that the two products or closely related products and services come from the same source. It is enough if the ordinary person entertains a reasonable doubt.

   It may be interpolated that this is another way of expressing the proposition that the trade mark is likely to cause confusion if there is a real likelihood that some people will wonder or be left in doubt about whether the two sets of products or the products and services in question come from the same source.

   In considering whether there is a likelihood of deception or confusion all surrounding circumstances have to be taken into consideration. These include the circumstances in which the marks will be used, the circumstances in which the goods or services will be bought and sold and the character of the probable acquirers of the goods and services.

   The rights of the parties are to be determined as at the date of the application.

   The issue must be considered in respect of all goods or services coming within the specification in the application and in respect of which registration is desired, not only in respect of those goods or services on which it is proposed to immediately use the mark. The question is not limited to whether a particular use will give rise to deception or confusion. It must be based upon what the applicant can do if registration is obtained.

   In respect of the last proposition, Mason J observed in Berlei Hestia Industries Ltd v The Bali Company Inc [1973] HCA 43; (1973) 129 CLR 353 at 362:

   “...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.”

   [9] Although I note that the trade marks in question here are in fact identical.

2. And, in considering the application of section 52 of the TPA, Hill J set out a number of propositions in Equity Access at paragraph 41:

   1.        For conduct to be misleading or deceptive the conduct must convey in all the circumstances of the case a misrepresentation: Taco Bell[10] at 202. In the present case the misrepresentation on the part of the respondents is said to be that the financial product advertised and marketed by each of them is the product of the applicant or that there is some business relationship between the applicant and each of the respondents or that the applicant has endorsed the respective product of the respondents.

   2. There will however be no contravention of s.52(1) of the Act unless error or misconception results from the conduct of the corporation and not from other circumstances for which the corporation is not responsible: Puxu[11] per Gibbs CJ at p 6 and per Mason J at p 15, Global Sportsman Pty Ltd v. Mirror Newspapers Ltd [1984] FCA 180; (1984) 55 ALR 25, at p 34.

   3.        Conduct will be likely to mislead or deceive if there is a “real or not remote chance or possibility” of misleading or deception regardless of whether it is less or more than 50%: Global Sportsman at p 34. The question of whether conduct is misleading or deceptive or likely to mislead or deceive is an objective question which the Court must determine for itself. Hence evidence that persons in the relevant class have been misled will, although admissible, not be determinative. In some cases however such evidence will be very persuasive: Puxu per Gibbs CJ at pp 198-9.

   4.        Conduct of a corporation causing mere confusion or uncertainty in the minds of the public in the sense that they may be caused to wonder whether two products may have come from the same source is not necessarily coextensive with misleading or deceptive conduct: Puxu at p 100; Bridge Stock Brokers v. Bridges [1984] FCA 391; (1984) 57 ALR 401 at p 413 per Lockhart J. Since actual deception need not be shown the Court must consider whether a reasonably significant number of potential purchasers would be likely to be misled or deceived: Weitmann v. Katies Ltd (1977) 29 FLR 336, 343. The test in passing off cases is usually expressed as being whether a “substantial number of persons likely to become purchasers ... are liable to be deceived by the defendant’s use of the name. On the other hand it is not necessary to show that all, or substantially all, persons in the market associate the name with the plaintiff’s goods, if this can be shown of a substantial proportion of persons who are probably purchasers of the goods of the kind in question.” (per Wilberforce J, as he then was, in Norman Kark Publications Ltd v. Odhams Press Ltd (1962) RPC 163 at 168 and see Saville Perfumery v. June Perfect Ltd (1941) 58 RPC 147 at 175-6, 10th Cantanae Pty Ltd v. Shoshana Pty Ltd (1987) 79 ALR 299 at 315 per Gummow J).

   5.        In a case such as the present the applicant must establish that it has acquired the relevant reputation in the name, that is to say that the name had become distinctive of the applicant’s business in a particular country or geographical area: Sheraton Corporation of America v. Sheraton Motels Ltd (1964) RPC 202; BM Auto Sales Pty Ltd v. Budget Rent A Car System Pty Ltd (1976) 12 ALR 363. However at least in some circumstances very slight activities may be found to be sufficient to establish that a name has become distinctive of a person’s business in a particular country: Miki Shoko Co Ltd v. Merv Brown Pty Ltd (1988) ATPR 40-858.

   6. Section 52 is not confined to conduct which is intended to mislead or deceive: Puxu per Gibbs CJ at p 197 and a corporation which acts honestly and reasonably may none the less engage in conduct that is likely to mislead or deceive: Yorke v. Lucas [1985] HCA 65; (1985) 61 ALR 307 at p 309.

   [10] Taco Company of Australia Inc v. Taco Bell Pty Ltd [1982] FCA 136; (1982) 42 ALR 177

   [11] Parkdale Custom Built Furniture Pty Ltd v. Puxu Pty Ltd [1982] HCA 44; (1981-2) 149 CLR 191)

3. I am to consider the likelihood that the ordinary purchasers of the goods of the goods would be confused or deceived or misled or deceived.  In the words of the Court in Nike (with footnotes omitted):

   It is in these cases of representations to the public, of which the first appeal is one, that there enter the “ordinary” or “reasonable” members of the class of prospective purchasers. Although a class of consumers may be expected to include a wide range of persons, in isolating the “ordinary” or “reasonable” members of that class, there is an objective attribution of certain characteristics. Thus, in Puxu, Gibbs CJ determined that the legislation did not impose burdens which operated for the benefit of persons “who fail[ed] to take reasonable care of their own interests”. In the same case, Mason J concluded that, whilst it was unlikely that an ordinary purchaser would notice the very slight differences in the appearance of the two items of furniture in question, nevertheless such a prospective purchaser reasonably could be expected to attempt to ascertain the brand name of the particular type of furniture on offer.

   Where the persons in question are not identified individuals to whom a particular misrepresentation has been made or from whom a relevant fact, circumstance or proposal was withheld, but are members of a class to which the conduct in question was directed in a general sense, it is necessary to isolate by some criterion a representative member of that class. The inquiry thus is to be made with respect to this hypothetical individual why the misconception complained has arisen or is likely to arise if no injunctive relief be granted. In formulating this inquiry, the courts have had regard to what appears to be the outer limits of the purpose and scope of the statutory norm of conduct fixed by s 52. Thus, in Puxu, Gibbs CJ observed that conduct not intended to mislead or deceive and which was engaged in “honestly and reasonably” might nevertheless contravene s 52. Having regard to these “heavy burdens” which the statute created, his Honour concluded that, where the effect of conduct on a class of persons, such as consumers, was in issue, the section must be “regarded as contemplating the effect of the conduct on reasonable members of the class”.

4. I note that “… the decision whether the use of a mark is likely to deceive or cause confusion is in the end a question of impression and common sense”: the Australian Berlei case at 357; see also “Bali” Trade Mark (1969) RPC 472 per Lord Upjohn at 497. Although it is a matter to be decided by the decision maker, it is a “jury question” on which, in a case like this, the decision maker is “entitled to give effect to his own opinion as to the likelihood of deception or confusion.”[12]

   [12] Adapting Re Murray Goulburn Co-Operative Company Limited v the New South Wales Dairy Corporation [1990] FCA 32; 24 FCR 370

5. Considering both section 52 of the TPA and section 60 of the Act, the evidence before me shows:

• The trade mark LONGINES is distinctive both in fact and law of the opponent’s goods;

• The opponent’s trade mark LONGINES has a strong reputation with connotations of prestige and quality which arise from the opponent’s use of the trade mark on watches;

• The only other signification of the word LONGINES apart from from being distinctive of the opponent’s goods is in a French dialect as referring to a ‘long meadow’; in other words, the trade mark LONGINES is only associated in the minds of the ordinary person with the opponent’s goods[13];

• The practice of brand extension is widely recognized by the ordinary person, particularly in relation to trade marks which have a strong reputation in relation to prestige goods;

• Other manufacturers of quality watches have brand extended into leather and luggage goods of the type in respect of which the applicant seeks registration; hence, the opponent’s brand extension into the goods of the opposed application would appear to be natural and logical to the ordinary person;

• Quality luggage and watches are sold in close proximately in some retail environments;

• The opponent has in fact used its trade mark on closely related items to those goods which fall within the specification of the opposed application in Australia which are promotional items used as inducements to purchase its goods;

  [13] This factor contrasts with the PIONEER and OMEGA examples given by Mr Longginou: the former is an ordinary dictionary word with meanings of being first or a leader and with connotations of enterprise or innovation and thus attractive to many traders for use as a trade mark.  The trade mark OMEGA contrasts with the LONGINES trade mark in that the word ‘omega’ is an ordinary English dictionary word and as a trade mark may (unalike the trade mark LONGINES) be associated with a number of different traders.

1. I consider that (in the light of the foregoing considerations) it is inevitable that most reasonable and ordinarily informed members of the public on seeing the opposed trade mark on the goods in Class 18 in respect of which registration is sought are likely to be naturally led to conclude that the trade mark is so used by, or under the auspices of, the opponent. 

2. Accordingly, I consider that the use of the opposed trade mark would constitute a misrepresentation by the applicant such that it would be caught by the terms of section 52 of the TPA and its use would be misleading or deceptive. It also follows that the use of the opposed trade mark by the applicant in relation to the goods in respect of which registration is sought would be confusing or deceptive in terms of section 60 of the Act.

3. Accordingly, the opponent has established its grounds under subparagraph 42(b) and section 60 of the Act.

4. There is no necessity to consider the evidence or submissions which went to the section 62A ground since the opposition has succeeded.

Decision

1. Section 58 of the Act relevantly provides:

   55Decision

   (1)Unless the proceedings are discontinued or dismissed, 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.

2. I refuse to register trade mark application 1210749.

Costs

1. The opponent is entitled to its costs which I award at the official scale against the applicant.

Iain Thompson

Hearing Officer

Trade Marks Hearings

23 August 2011