Complete Technology Integrations Pty Ltd v Smart Home Solutions Pty Ltd
[2008] ATMO 39
•27 May 2008
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re:Opposition by Complete Technology Integrations Pty Ltd to registration of trade mark application 955049(37) - SMART HOME SOLUTIONS - filed in the name of Smart Home Solutions Pty Ltd.
Delegate:
Ian Thompson
Representation:
Opponent
David Kell, Counsel, instructed by Marilyn Gauci of James Tuite & Associates
Applicant
James Maxwell of Peter Maxwell & Associates
Decision:
2008 ATMO 39
Section 52 opposition:
Section 41 – in light of the evidence the words SMART HOME SOLUTIONS lack any inherent adaption to distinguish; the trade mark considered as a whole lacks any inherent adaption to distinguish. Subsection 41(6) – no evidence of factual distinctiveness at the relevant date. Opposition established.
Registration refused.
Costs
Awarded against applicant.
Background
Smart Home Solutions Pty Ltd (‘the applicant’), of O'Riordan Street, Alexandria, NSW, filed application to register a trade mark, details of which currently are:
Appn No: 955049
Priority date: 21 May 2003 (‘the relevant date’)
Goods/Services: Class 37: Installation, repair, maintenance and construction services in relation to electrical and electronic apparatus and equipment including control equipment and apparatus for controlling domestic lighting installations, lighting, lighting systems, lighting apparatus, lighting equipment, data equipment and systems, video and DVD equipment and systems, audio and audio-visual equipment and systems, climate control equipment and systems, security equipment and systems, home automation systems (‘the opposed services’)
Trade Mark: (‘the opposed trade mark’)
The application was accepted for registration under the provisions of subparagraph 44(3)(a) and subsection 41(5) of the Trade Marks Act 1995 (‘the Act’) and advertised in the Australian Official Journal of Trade Marks on 19 May 2005.
On 19 August 2005, Complete Technology Integrations Pty Ltd, (‘the opponent’) of Cathedral Street, Woolloomooloo, NSW, filed Notice of Opposition, (‘the Notice’) to the registration of the trade mark. The Notice cites six grounds of opposition, of which two were relied upon at the hearing of the matter – those being under sections 41 and 59 of the Act. For the sake of completeness, I note now that the opponent has not established those other grounds of opposition.
The parties duly served their evidence in support, evidence in answer, evidence in reply, and further evidence and the matter came before me as a delegate of the Registrar of Trade Marks on 7 April 2008 in Sydney. David Kell, Counsel, instructed by Marilyn Gauci of James Tuite & Associates (‘the solicitors’) represented the opponent. James Maxwell of Peter Maxwell & Associates (‘the attorneys’) represented the applicant. At the hearing I reserved my decision and now give my decision and written reasons.
The Evidence
The evidence from both parties is quite comprehensive and comprises the following declarations:
Item Declarant Date Made Exhibits Evidence in Support 1
Scott Warren
Director, Opponent17 February 2006
SW-1 to SW-29
2
Tove Anna Maria Henningson
Solicitor, opponent17 February 2006
TH-1 to TH-58
3 David Neville Symons 1 March 2006 4 David James Anderson 14 March 2006 5 Scott Jones 28 March 2006 6 Antonio Messina 3 April 2006 Evidence in Answer 7
James Billington
Director of applicant25 May 2007
JB-1 to JB-28
8 Douglas Isaac 11 July 2007 9 Jeffrey John Patchell 5 June 2007 10 Harry Simidis 12 June 2007 11 James Raymond Preece 20 June 2007 12 Bruce Ensor 19 June 2007 13 David Weston 19 June 2007 14 David Wayne Small 19 June 2007 Evidence in Reply 15
Marilyn Gauci
Solicitor, opponent26 November 2007
16 Scott Jones (‘Jones 2’) 26 November 2007 17
David Neville Symons (‘Symons 2’)
12 November 2007
18
David James Anderson (‘Anderson 2’)
9 November 2007
Further Evidence 19
David Neville Symons (‘Symons 3’)
10 January 2008
Excepting the Warren, Henningson, Billington, and Gauci declarations, the declarations are what might broadly be called ‘trade declarations’ which I will discuss under that heading, below.
The Evidence in support
The Warren declaration is, as indicated above, by a director of the opponent. Mr Warren states that he a director of the opponent and has been working in the field of home automation for about nine years and exhibits to his declaration a copy of his curriculum vitae.
Mr Warren avers that the opponent provides a variety of services through a business unit called ‘CTI SmartHome’ including structured cabling systems, security, camera systems, telephone systems, home theatre and multi-room audio and has done so since at least 2001. Mr Warren exhibits NSW, Victoria and Queensland business name registrations for ‘CTI SmartHome’ to his declaration.
Mr Warren attests as to what his understanding of a ‘smart home’ is:
The precise features of any particular "smart home" will vary depending upon the desires of the client and cost considerations. By way of example, a "smart home" may feature matters such as:
Integrated entry
Upon arriving home you press your remote key chain button to open the Garage door. The smart home then starts to make decisions; firstly it turns the security alarm off and activates the "welcome home mode".
Welcome home
The "Welcome Home" activates when you arrive home, room lighting adjusts automatically, blinds and louvers may open depending on the time of day or night and air conditioning turns on automatically.
Because the smart home is aware of the dark conditions it will automatically turn on lighting throughout your home for easy and safe entry. You can rest assured and feel secure that there is no more fumbling with light switches in a dark room as you carry the shopping into the house.
Goodnight
As you enter your bedroom you simply press the "Goodnight" button and while your bedroom and ensuite lights remain on as you prepare for bed, the house has automatically begun to shut down ready for your peaceful sleep or for you to read in bed.
You no longer have to check the lights around the house to make sure everything has been turned of. The smart home has taken care of things for you.
Security
When you hear a "Bump in the night" you immediately press the Panic Button located on either side of your bed and your smart home automatically turns on external lights and selected lighting in your home, scaring off would be intruders or allowing for investigation without fumbling for switches.
When you discover it was the cat next door, you simply return to your bedroom and activate the "goodnight" mode and retire back to bed.
Leaving home
When you leave your home, you simply press your remote as you exit and your smart home begins to shut down.
Lighting turns off throughout the house, air conditioning systems shutdown saving your energy costs, louvres and blinds (if fitted) close.
Your home waits patiently until your arrival later that evening.
Entertaining
As you prepare for that special dinner party you simply activate the "Entertaining" mode and your smart home takes care of the turning on lights throughout the house to just the right level.
The Front and Back garden lighting turns on to show off your intelligent home.
Holidays
As you prepare and depart for your holidays you begin to relax knowing that your smart home will take of itself.
Under Floor Heating, Heated Towel Rails, Air Conditioning and other items turn off until your return.
As you are away on your holidays, your home turns on and off your lighting giving that lived in appearance. Sure to fool that would be intruder thinking someone is home.
10. Mr Warren avers to his knowledge of the expression ‘smart home’ as being used in the home automation trade since 1998 and goes on to state:
The magazine called "SmartHouse Magazine Australia" has been published in Australia since 2002. Exhibited and marked "SW-6" is a copy of an article dated 25 September 2002 and headed "Smart Home Titles Move into Australian Market" printed from B and T's website ( The article announces the launch of SmartHouse magazine in 2002 and the planned launch in 2003 (which did occur at about that time) of "a trade magazine for SmartHouse resellers, solution providers and installers."
Exhibited and marked "SW-7" is the SmartHouse Magazine Australia issue dated March 2003 (I cannot presently locate an earlier edition).
Exhibited and marked "SW-8" is a copy of the advertisement by Dynalite/LightStyle appearing at page 8 of the SmartHouse magazine dated March 2003 and which includes the heading "a smart home needs a solid foundation" and the commentary "LightStyle's lighting control system provides a solid foundation to build your smart home."
[Stress added]
11. Also in Mr Warren’s evidence is a DVD containing an advertisement by Clipsal Australia Pty Ltd which Mr Warren states he first saw at the Clipsal 500 V8 Supercars event in Adelaide in March 2003. The advertisement is for a range of home automation products. The advertisement features both the spoken and written words (flashed briefly on the screen) ‘Smart Home Solutions.’
12. There are several other exhibits which include the words ‘smart home’ or ‘smart house’ exhibited to Mr Warren’s declaration and which occur after the relevant date.
13. The other main plank in the opponent’s evidence in support is the declaration by Ms Henningson who is a solicitor. This evidence mainly concerns the use of the words ‘smart homes’ and for the sake of brevity I will presently reproduce only those which have allegedly occurred before the relevant date. Ms Henningson says:
· Exhibited and marked "TH-2" is a copy of a search entry from Whatis.com (the internet IT-specific encyclopedia) for "smart home". The entry is listed as having been last updated on 31 July 2001. The entry includes the following commentary:
"A smart home or building is a home or building, usually a new one, that is equipped with special structured wiring to enable occupants to remotely control or program an array of automated home or electronic devices by entering a single command. For example, a homeowner on vacation can use a Touchtone phone to arm a home security system, control temperature gauges, switch appliances on or off control lighting, program a home theatre or entertainment system, and perform many other tasks."
· Exhibited and marked "TH-3" is a print-out of the transcript from an ABC Radio National program (The Buzz) with the heading "ABC Radio National: The Buzz 4 March 2002 - World Congress on IT: The Next 10 Years - Smart Home Technologies" (printed from the ABC website: Also exhibited to Ms Henningson’s declaration is a letter of demand from the applicant’s prior legal representatives to the opponent and a response to it from the solicitors. The letter of demand apparently refers to the opponent’s alleged use of the trade mark CTI SmartHome, is dated 12 August 2004, is predicated upon the trade mark application and couched in the following terms:
I act for Smarthome Solutions.
My client is the registered owner of the above names, [Smarthome and Smartbox] both as business names and trademarks.
My client is concerned that you are using those words and you do not have the authority to do so.
My client now demands that you cease the use of both words in your advertising material.
The use of these words clearly infringes the Common Law and the Trade Practices Act and you are asked to desist immediately.
We ask for your immediate undertaking that you will desist. If we do not receive same within seven days we will have no alternative but to take action against you. Such action can result in very hefty legal costs and to that end we look forward to your cooperation.
[Parenthetical material added]
15. I note that the above letter contains several misstatements – for example, the trade mark on which the letter relies is unregistered and neither it nor the opponent’s company name contains or consists of the word ‘Smarthome’.
16. The response from the opponent’s solicitors notes this in the following way:
We note that Smarthome Solutions Pty Ltd is not the registered owner of the trademark `Smarthome'. The application for registration of the trademark 'Smart Home Solutions' is currently pending. Please be on notice that should the trademark application be accepted we are instructed to lodge a Notice of Opposition disputing registration.
We are of the opinion that the term 'Smart Home' is a generic and descriptive industry term used to describe a concept, which is used by traders other than your client, in the ordinary course of their business without improper motive.
Further, our client is the registered owner of the business name ‘CTI Smarthome’ in New South Wales, Victoria and Queensland and has an established and distinctive market reputation.
In light of the above, we are of the opinion that your client does not have any grounds upon which to argue that our client has acted in breach of the Trade Practices Act or common law.
If proceedings are commenced against our client we will rely upon the contents of this letter in accordance with the principles in Calderbank v Calderbank and a claim for costs on an indemnity basis will be sought from the date of this letter.
The Evidence in Answer
17. The leading declaration in the evidence in answer is the Billington declaration. In his evidence in answer, Mr Billington, who is a director of the applicant, avers:
Integrated System Installations Pty Limited was originally incorporated on 18 October 1996 under the name Smart Home Solutions Pty Limited. This was the company who originally carried out the business now carried out by Smart Home Solutions Pty Limited (ACN 096 415 119) (Exhibit JB-1). This company was known as Smart Home Solutions Pty Limited from 18 October 1996 until 23 April 2001. In 2001, due to an investor coming into the company, Smart Home Solutions Limited (ACN 076 045 853) (Exhibit JB-2) changed its name to Integrated System Installations Pty Limited and effectively became a holding company. At approximately the same time, the second Smart Home Solutions Pty Limited was incorporated (Exhibit JB-1) and continued carrying out the business previously carried out by the first Smart Home Solutions Pty Limited (Exhibit JB-2). As far as the public were concerned, the company carrying out the business was always Smart Home Solutions Pty Limited, but there were different ACN's. Owing to a dispute with a former partner and investor, Integrated System Installations was deregistered in 2006. The records of Integrated System Installations Pty Limited now form part of the records of Smart Home Solutions Pty Limited and for the sake of convenience throughout this Statutory Declaration I will refer to both companies as "My Company". By way of clarification, the "first" Smart Home Solutions Pty Limited carried on the business from 1996 to 2001 and from 2001 to the present time the "second" Smart Home Solutions Pty Limited carried on the business.
18. Concerning use of the opposed trade mark, Mr Billington attests:
Accordingly, Integrated System Installations Pty Limited, previously and then named Smart Home Solutions Pty Limited (ACN 076 045 853) first used [the opposed] trade mark in October 1996 in respect of design and installation of electronic lifestyle systems for residential and commercial building construction including:-
installation, repair, maintenance and construction of structured cabling, lighting and controls, telecommunications, security systems, CCTV, access controls, home music, home theatre, IT/LAN/WLAN electrical and electronic apparatus and equipment including control equipment and apparatus for controlling domestic lighting installations, data equipment and systems, video and DVD equipment and systems, audio and audio-visual equipment and systems, climate control equipment and systems, security equipment and systems and home automation systems ("the [opposed] services").
In addition to using the Trade Mark in the stylised form set out above, My Company also uses the Trade Mark in block letters namely "SMART HOME SOLUTIONS". My Company is constantly referred verbally by the trade and its customers as "Smart Home Solutions", My Company's phone is always answered "Smart Home Solutions" and in written articles and journals featuring My Company it is always referred to as "Smart Home Solutions" and represented in block letters rather than the stylised version set out above. Therefore, there has been use of "Smart Home Solutions" as a firm not only in block letters but mainly in respect of the stylised mark set out above. Therefore, as there has also been many references to the trade mark in block letters, I will also refer to SMART HOME SOLUTIONS as the trade mark.
Concerning sales and advertising figures, Mr Billington gives these for the years 1997 until 2006 with the exception of the year 2001 for which no figures are provided. The figures range from a little under $200,000 in 1997 to a high point of just under two million dollars in 2005. However, I am not certain what these figures represent – Mr Billington refers to them as being in respect of the services provided under the opposed trade mark. Quotations and articles supplied by the applicant in evidence make it clear that the cost of an installation, which includes equipment but not wiring, can range from $20,000 up to a third of a million dollars. The figures provided might thus at the high point, represent slightly over six sales a year or, in respect of the more modest installation, as many as one hundred.
The advertising figures appear to be quite low and, (while the Patchell declaration is from the director of a magazine called Connected Home Solutions and the Preece declaration is made by the General Division Manager of Horwitz Audio/Vidual [sic] Publishing Group which publishes the magazine Australian Smart Homes Ideas Magazine and the Richards declaration is by the CEO of 4 Square Media which publishes the magazine Smart House), no advertising in any of these magazines which might show the opposed trade mark is exhibited to Mr Billington’s declaration or to these other declarant’s evidence.
The only materials within Mr Billington’s evidence which purport to show the opposed trade mark in use and which obviously predate the filing of the opposed application are:
·Exhibit JB-18 which are copies of purchase and invoice orders dated from 1996. They show a trade mark on them which appears below:
There are other materials such as stationery and brochures which may post-date the filing of the opposed application which purport to show the opposed trade mark in use. For example, a business-card (with contact details which I have obscured) from within exhibit JB-25:
I will further discuss the leading declarations of the parties as is necessary under the heading ‘Section 41,’ below.
Trade Declarations
The trade declarations in support of the opposition are by Messrs David Neville Symons, David James Anderson, Scott Jones, and Antonio Messina. These declarations are from electrical contractors and at least two of them state they are trade competitors of the opponent. There are no great similarities between the declarations which are obviously freely made in the words of the deponents. Mr Symons’ declaration is typical. He avers:
I have worked as an electrical contractor for 35 years, and have been involved in providing home automation services (sometimes called services relating to "smart homes") for approximately 12 years. I am 54 years old.
I am the proprietor of the business Automated Lifestyles, with operates out of business premises at 256A Annangrove Road, Annangrove, in New South Wales.
Automated Lifestyles operates as a direct market competitor of Complete Technology Integrations Pty Limited (`CTI') in the provision of the services I have referred to above.
The term 'smart home' is an expression that I am very familiar with. It generally refers to homes that are technologically advanced in some form.
A 'smart home' is usually a new building that is specially wired to enable the occupant to remotely control or programme commands within the building, and in response the building itself exhibits an internal intelligence. It uses its 'smarts' to carry out the occupant's commands.
As technology advances, homes are constantly becoming 'smarter'. Ten years ago a house with an intercom may have been considered a 'smart home'; today such a home would typically include much more advanced automated features.
I regularly use the expression "smart home" during the course of my business - both when dealing with other tradesman and also in dealings with home-owners. I would estimate that I have been using the expression "smart home" (and the equivalent term "smart house") since at least the late 1990s.
In my experience the phrase a "smart home solution" is commonly used as a 'sales pitch' by persons in the home automation field. It is not uncommon for the terms `smart home' and 'solutions' to be used jointly when describing the benefits of an automation system, technological or design advancement within the building. I have used the expression myself from time to time and have done on occasions from about the late 1990s.
I have also often encountered the terms 'smart home', 'smart house' and occasionally `smart home solutions' being used by other persons and customers in the home automation field since about the late 1990s and certainly more so since 2001.
Until recently, I did not know that Integrated Systems Installations Pty Ltd ("ISI") [the predecessor of the applicant] had applied to register "Smart Home Solutions" as a trade mark. I regard the phrase "smart home solutions" and "smart homes" as descriptive terms that persons in the home automation field routinely use from time to time. I do not believe that any one company should have a monopoly right to the words. I do not want to be prevented from using the words in my business in future because of a trade mark registration by ISI.
25. By contrast the trade declarations of Messrs Douglas Isaac, Jeffrey John Patchell, Harry Simidis, James Raymond Preece, Bruce Ensor, David Weston, and David Wayne Small served and filed as evidence in answer are by and large in common form and from traders who one might reasonably view as having some business connection with the applicant. Mr Patchell’s declaration is fairly typical. He avers:
I am the Managing Director and Publisher for Connection Magazines Pty Ltd and have held this position for 23 years.
Connection Magazines Pty Ltd publish various technical and business publications including Connected Home Solutions which is devoted to the home automation/home technology industry.
By reason of my position I am familiar with suppliers and distributors of home automation and audio visual technologies throughout Australia and am familiar with the trade mark, brand names and names used by such operators.
I identify [the opposed trade mark] with Smart Home Solutions Pty Ltd. When I see the Trade Mark, I associate it solely with the goods and services provided by Smart Home Solutions Pty Ltd. Smart Home Solutions Pty Ltd and the Trade Mark are well known throughout the home automation and home technology industry.
I have known the use of the Trade Mark by Smart Home Solutions Pty Ltd for the past 5 years. I am not aware of any other party using a name or trade mark similar to the Trade Mark.
26. I notice that the name of the magazine published by Connection Magazines Pty Ltd, Connected Home Solutions, and the opposed trade mark bear a marked similarity. One might reasonably conclude that the declaration did not attract Mr Patchell’s full attention.
I am inclined to accord less weight to the trade declarations of the applicant than I do to those of the opponent, having regard to the formers’ composition which is largely in common and the seeming relationships of the deponents’ businesses to that of the applicant.
Section 41
Section 41 of the Act provides:
41Trade mark not distinguishing applicant’s goods or services
(1)For the purposes of this section, the use of a trade mark by a predecessor in title of an applicant for the registration of the trade mark is taken to be a use of the trade mark by the applicant.
Note 1:For applicant and predecessor in title see section 6.
Note 2:If a predecessor in title had authorised another person to use the trade mark, any authorised use of the trade mark by the other person is taken to be a use of the trade mark by the predecessor in title (see subsection 7(3) and section 8).
(2)An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (designated goods or services) from the goods or services of other persons.
Note:For goods of a person and services of a person see section 6.
(3)In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.
(4)Then, if the Registrar is still unable to decide the question, the following provisions apply.
(5)If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:
(a)the Registrar is to consider whether, because of the combined effect of the following:
(i)the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;
(ii)the use, or intended use, of the trade mark by the applicant;
(iii)any other circumstances;
the trade mark does or will distinguish the designated goods or services as being those of the applicant; and
(b)if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons; and
(c)if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken not to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons.
Note 1:For goods of a person and services of a person see section 6.
Note 2:Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).
(6)If the Registrar finds that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, the following provisions apply:
(a)if the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant—the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other persons;
(b)in any other case—the trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons.
Note 1:Trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate:
(a) the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; or
(b) the time of production of goods or of the rendering of services.
Note 2:Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).
The scheme of section 41 and how it operates were discussed by Branson J in Blount Inc v Registrar of Trade Marks [1998] FCA 440 (‘Oregon’):
Subsections (3) to (6) of s 41 of the Act are designed to control the process by which the Registrar is to reach a conclusion as to whether the trade mark for which registration is sought is capable of distinguishing the applicant's goods or services in respect of which the trade mark is sought to be registered ("the designated goods or services"). If the trade mark is not so capable, the application for its registration must be rejected (s 41(2)). Subsection (3) requires the Registrar first to "take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons". Having taken such matter into account, it is theoretically open to the Registrar to conclude:
(a) that the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons and capable, on that basis alone, of so distinguishing the designated goods or services; or
(b) that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons; or
(c) that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, but there is uncertainty, on that basis alone, that the trade mark is actually capable of so distinguishing the designated goods or services.
The structure of s 41 of the Act dictates that if the Registrar reaches conclusion (a) above, then he or she will decide the question whether or not the trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons by reaching the answer that it is so capable by reason of its inherent adaptability to distinguish (s 41(2) and (3)). The Registrar will, in such circumstances, be required, by reason of the terms of s 33(1) of the Act, to accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application.
If the Registrar reaches conclusion (b) or (c) above, he or she is, within the meaning of s 41(4) "unable to decide the question". That is, he or she is unable, simply by taking into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services, to answer the question whether or not the trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons.
If the Registrar reaches conclusion (b) above, then the provisions of paragraphs (a) and (b) of s 41(6) are brought into operation. If the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date of the application, the trade mark does distinguish the designated goods or services as being those of the applicant, the Registrar will not reject the application pursuant to s 41(2). The Registrar will, in such circumstances, accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application (s 33(1)). If the applicant fails to establish that because of the extent to which the applicant has used the trade mark before the filing date of the application, the trade mark does distinguish the designated goods or services as being those of the applicant, the Registrar must reject the application pursuant to s 41(2).
If the Registrar reaches conclusion (c) above, then the provisions of paragraphs (a), (b) and (c) of s 41(5) are brought into operation. If the Registrar , having considered the combined effect of the matters listed in subparagraphs (i), (ii) and (iii) of s 41(5)(a), is satisfied that the trade mark does or will distinguish the designated goods or services as being those of the applicant, he or she will not reject the application pursuant to s 41(2). The Registrar will, in such circumstances, accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application (s 33(1)). If the Registrar, having considered the combined effect of the matter listed in subparagraphs (i), (ii) and (iii) of s 41(5), is not satisfied that the trade mark does or will distinguish the designated goods as being those of the applicant, the Registrar must reject the application (s 41(2)).
The first step is to take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons. In this consideration, I am to adopt the standard in Oregon, per Branson J:
Each of s 33(1) and s 41 involves the concept of the Registrar being "satisfied". Where the Act requires the Registrar to be "satisfied" of any matter, it is to be understood as requiring that he or she be persuaded of the matter according to the balance of probabilities (Rejfeck v McElroy [1965] HCA 46; (1965) 112 CLR 517 at 521). That is, that the Registrar be persuaded, having given proper consideration to those factors and circumstances that the Act requires him or her to give consideration to, that such matter is more probable than not.
In Oregon, Branson J adopted the approach set out in Clark Equipment Company v Registrar of Trade Marks [1964] HCA 55; (1964) 111 CLR 511 at 514, where Kitto J put the test in the following way:
"[T]he question whether a mark is adapted to distinguish [is to] be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives - in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess - will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it."
I consider that the evidence makes it plain that the words ‘smart home’ are used to designate automated houses or apartments. Mr Maxwell argued that the only pertinent evidence is that which is from before the relevant date. However, subsection 41(3) is cast in the present tense – it does not ask the question whether the trade mark was inherently adapted to distinguish the designated goods or services, rather it asks the question whether it is inherently adapted to distinguish the designated goods or services. The question whether the trade mark is inherently adapted to distinguish is one which is to be considered in the present – the language of subsection 41(3) makes this plain (as indeed does that of subsections 41(5) and 41(6)). The expression ‘smart home’ occurs throughout the evidence – it also notably occurs with some frequency in the magazine articles within the applicant’s evidence.
While at least one of such usages in the evidence in support of the opposition is an overseas use, I consider it to be relevant for the same or similar reasons stated by Sheppard J in Larry John Powell v Glow Zone Products Pty Ltd [1996] FCA 1021:
But what the evidence does is to show that, because of the use of the word "caps" in the United States well before the end of May 1994 and the dealings which occurred between some organisations and United States companies in relation to the importation or proposed importation of either product or samples before that time, the word "caps" was in fact a word which traders, acting reasonably and in good faith, would be likely to wish to use in connection with a similar product if it were imported into Australia. The assistance which the evidence provides is to enable the Court more confidently to draw the conclusion that the word "caps" was at the relevant time indeed a word which traders would normally and properly wish to use to describe their goods as indicating or emphasising the nature of their goods to the general public.
Evidence which demonstrates the meaning of the words ‘Smart Home’ as denoting automated houses or apartments includes:
· The article in “SmartHouse Magazine Australia” marked exhibit “SW-6” being a copy of an article dated 25 September 2002 and headed “Smart Home Titles Move into Australian Market”.
· Exhibit "SW-8" being a copy of the advertisement by Dynalite/LightStyle appearing at page 8 of the SmartHouse magazine dated March 2003 and which includes the heading "a smart home needs a solid foundation" and the commentary "LightStyle's lighting control system provides a solid foundation to build your smart home."
· “TH-2” being a copy of a search entry from Whatis.com (the internet IT-specific encyclopedia) for "smart home". The entry is listed as having been last updated on 31 July 2001.
· Exhibit "TH-3" being a print-out of the transcript from an ABC Radio National program (The Buzz) with the heading "ABC Radio National: The Buzz 4 March 2002 - World Congress on IT: The Next 10 Years - Smart Home Technologies" (printed from the ABC website: This evidence casts light on the meaning of the words ‘smart home’ within the opposed trade mark and their complete lack of inherent adaption to distinguish the services of the applicant – but what of the expression ‘smart home solutions’?
Examples of the use of the words ‘smart home solutions’ within the opponent’s evidence include:
· Exhibit SW-10 an advertisement by Advantech Australia Pty Ltd in Smart House magazine, Aug 2003 issue refer to "Advantech Smart Home Solutions"
· Exhibit TH-19, pages from the Advantech Australia Pty ltd website include reference to "Smart Home Solutions"
· Exhibit TH-39, pages from the website of Smart, Safe and Sound Pty Ltd refer to "Complete Smart Home & Building Solutions"
· Exhibit TH-27, Pages from the website of Smarthome Technology Corp (a division of NG Technology Pty Ltd) which proclaims that they specialise in “Smarthome Solutions"
37. Additionally, in my observations and experience of the world, the word ‘solutions’ is frequently tacked on to, or used with, words which are in effect generic of the services being offered such ‘logistics,’ ‘catering,’ ‘management,’ or ‘information technology,’ to provide a simple and concise statement to the public about the nature of the service which is being provided as a complete answer to their particular ‘problem’ or need. Thus, I do not consider the expression ‘smart home solutions’ to have any more inherent capacity to distinguish the services of the applicant than would the expressions ‘management solutions’ or ‘catering solutions’ for services in the management or catering areas.
These observations are born out by the advertisements and web-pages in the opponent’s evidence, in particular the one by Clipsal Australia Pty Ltd I refer to above which Mr Warren states he first saw at the Clipsal 500 V8 Supercars event in Adelaide in March 2003. The advertisement is for a range of home automation products. The advertisement features both the spoken and written words (flashed briefly on the screen) ‘Smart Home Solutions.’ I observe that the advertisement must have been prepared prior to March 2003 (and, incidentally, before the relevant date in May 2003) by people who understood what the written and spoken words ‘Smart Home Solutions’ mean, who also appreciated that they would be readily understood by others – in particular, traders and the public who might buy products made by Clipsal Australia Pty Ltd for installation in automated houses or apartments.
Mr Maxwell, at the hearing, submitted that this use by Clipsal Australia Pty Ltd was one isolated use – I gather that the submission is that the use is effectively de minimis and should not be taken to indicate that the words lack any inherent adaptation to distinguish – the argument also requires me to consider the inherent adaptation of the words at the relevant date. However, if I were required to do so, I consider that the determination that the words lack any inherent adaptation to distinguish at any date should apply even if the advertisement by Clipsal Australia Pty Ltd was not in evidence, based on the ordinary English meaning of the expression, ‘Smart Home Solutions,’ or the common term in the trade ‘smart homes’ used in conjunction with the ordinary English word ‘solutions.’ An expression or trade mark such as, for example, ‘Cranberry Classic’ might lack in any inherent adaptation to distinguish based on its ordinary English meaning at the relevant date notwithstanding the fact that it was not evidenced to have been in any use amongst juice makers at that time: Ocean Spray Cranberries Inc v Registrar of Trade Marks 2000 [FCA] 177.
In any event, as I have said, subsection 41(3) is cast in the present tense and thus looks to the present inherent adaptation of the trade mark to distinguish the services of the applicant – the presence of the words ‘Smart Home Solutions’ prominently used in the advertisements and websites of other traders convinces me that the words are without any inherent adaptation to distinguish the services of the applicant whatsoever.
The words within the opposed trade mark are ones which are in fact needed and used by traders in the ordinary course of trade without improper motive (who do, indeed, use them that way) and should thus be viewed as being without any inherent adaption to distinguish the services of the applicant.
At the hearing Mr Maxwell, for the applicant, drew my attention to the black block within the trade mark which encloses the words ‘smart’ and ‘solutions.’ He also drew my attention to the font or fonts in which the trade mark is rendered and stated that the applicant in effect sought protection for these aspects of get-up in which the words are rendered and that these aspects effectively move (or restrict) the considerations to ones under either subsection 41(3) or subsection 41(5).
Mr Kell drew my attention to Bayer Pharma Pty Ltd v Farbenfabriken Bayer Aktiengesellschaft [1960] HCA 35; (1965) 120 CLR 285 (‘Bayer’) where the applicant involved, “sought registration of a mark consisting of the word BAYER printed in roman capital letters horizontally and again vertically, so that the printings intersect and the letter "Y" is common to both, the whole being enclosed within a circle.” Mr Kell also drew my attention to Oregon, above, where what was sought to be registered was the word ‘Oregon’ within an elliptical or oval border.
In Bayer, Kitto J observed at paragraph 13:
If, then, the desired registrations are to be granted, it must be on the ground that the cross device, possesses a capacity, either inherent or acquired, to distinguish goods as being in a relevant sense the respondent's. First, then, is the cross device inherently adapted to produce this effect? I do not think that it is. In my opinion it merely provides a fancy method of presenting the name "Bayer", and it has no greater aptitude than has the name itself for distinguishing the proprietor's goods from those of other people who happen to be known as "Bayer". It seems to me beyond doubt that the name is the feature which makes the device what it is - the feature which stands out as the operative thing in it, and to which everything else is merely assistant - the feature which (to use a phrase of Lloyd Jacob J. (1955) 72 RPC, at p 195) "would strike the eye and fix in the recollection". The dominant impression which the device gives is not adequately described as that of a cross formed by printing; it is an impression of the name "Bayer", arranged indeed in a particular way so that it appears twice yet with compactness and definition, but predominantly the name "Bayer". The effect produced by an application of the device to particular goods is essentially that of a branding of the goods with that name, albeit in a quaint manner; for, to some extent by the delimiting effect of the circle, and much more by the arrangement of the two words so that they intersect and share the one middle letter, attention is focussed on the identity of the words, and "Bayer" is impressed sharply on the mind. Throughout this case, the device has been referred to, by witnesses and counsel alike, as a "Bayer" Cross. That is exactly what it is: not in the sense that it is a cross device belonging to a person or corporation having "Bayer" as part of its name, but in the sense that it is in essence the word "Bayer", presented in the form of a cross. The case seems to me to be as clear as the Benz Case (1913) 30 RPC 177 and the Ludowici Case [1938] HCA 67; (1938) 61 CLR 149 (at p293)
In Oregon, which was a decision under the Trade Marks Act 1995 as opposed to its legislative predecessors, Branson J referred to Bayer with approval and observed:
By analogy, it seems to me that I must conclude that the particular manner in which the applicant's trade mark presents the word "Oregon" does not give it inherent adaptability to distinguish the designated goods, the word "Oregon" alone lacking such inherent adaptability. I do not think that the use of upper-case letters, and the oval device surrounding the word "Oregon" are sufficient to take the applicant's trade mark outside of the ambit of the observation set out above of Kitto J in the Bayer Pharma Case. These aspects of the trade mark, whether viewed singly or together, are not, in my view, sufficiently distinctive to give the trade mark a significance other than its ordinary geographic significance or its significance in respect of a particular kind of timber.
I am in like mind about the opposed trade mark which must be viewed as falling within the ambit of Oregon and Bayer.[1] The black block is not inherently adapted to distinguish and, considered in conjunction with the words, does no work in adding to the opposed trade mark’s inherent adaptation when it is considered as a whole. I also observe that it is apparent that the evidence in answer extensively supports this viewpoint. Two examples will illustrate this. Mr Billington says in his declaration:
[1] Contrast with Standard Cameras Ltd's Application (1952) 69 RPC 125 where the trade mark, consisting of the name "Robin Hood" represented in an unusual manner by having the letter "R" in a form of an archer and the letter "D" depicting a target, was found to be original and one which other traders would be unlikely to devise. Lawrence L J said at p 129:
"No one, I think, would seriously contend that to any ordinary eye the representation of the words "Robin Hood" set out on this application would not be accepted by everybody as being out of the common. Having come to the conclusion that it is out of the common, I have to look at it to see whether it is sufficiently out of the common to strike the eye as peculiar, and by "peculiar" I mean not likely to occur to somebody who merely wishes to represent the word.
I myself entertain no doubt that it is an unusual representation, which does strike the eye as uncommon, and which I should suppose is so unlikely as to be substantially impossible for any ordinary man wishing to represent the name "Robin Hood" to arrive at."
My Company is constantly referred verbally by the trade and its customers as "Smart Home Solutions", My Company's phone is always answered "Smart Home Solutions" and in written articles and journals featuring My Company it is always referred to as "Smart Home Solutions" and represented in block letters rather than the stylised version set out above. Therefore, there has been use of "Smart Home Solutions" as a firm not only in block letters but mainly in respect of the stylised mark set out above. Therefore, as there has also been many references to the trade mark in block letters, I will also refer to SMART HOME SOLUTIONS as the trade mark.
Mr Billington subsequently states at paragraph 19 of his declaration:
Now shown to me and marked Exhibit JB-11 is copy of the front page of the February/March 2003 edition of Sound and Image Magazine, which featured an article on My Company. I note that My Company's name, which is also the Trade Mark, is repeated throughout the article.
[Stress added]
I note the ‘stylised’ version of the trade mark does not appear within the cited article and thus, at least until the hearing, the applicant was apparently of the opinion that there is no substantial difference between the opposed trade mark and the words within it.
I also note that the letter of demand issued by the applicant gained its alleged authority in words within the opposed trade mark.
I am, in any event, satisfied on the basis of Bayer and Oregon that any get-up within the opposed trade mark does not alter the observation that the trade mark as a whole lacks any inherent adaption to distinguish the services of the applicant and that the considerations in relation to the opposed trade mark thus fall under section 41(6).
There are only limited examples in evidence of the opposed trade mark clearly in use before the relevant date and these are in the applicant’s quotes and receipts or invoices. The brochures and website printouts in evidence could be from either before or after the relevant date.
Having effectively defined the trade mark within the declaration of Mr Billington as being both the opposed trade mark and the words SMART HOME SOLUTIONS (and within the quote in paragraph 47, above, possibly as being the company name ‘Smart Home Solutions Pty Ltd’) it is difficult to form an appreciation of what the declaration really means or to what version of the trade mark referred to within the declaration the sales and promotional figures might apply. It is not obvious, for example, if the articles which appear in magazines in the evidence in answer are, in essence, ‘infommercials’ and this is where the advertising expenditure which is mentioned in Mr Billington’s declaration has been spent. The opposed trade mark does not appear in these articles – or any other paid advertisement in evidence.
The applicant’s trade declarations, while I do not put any great weight upon them, are all from within the Sydney area. The sales and marketing effort of the applicant appear (at or before the relevant date) to have been largely within the Sydney area – and, as I have noted, the figures provided could refer to anywhere between 6 and 100 sales a year. However, the application seeks an Australia-wide registration and the evidence, application, and submissions claim, although on what basis it is not clear, an Australia-wide distinctiveness of the opposed trade mark at the relevant date. In any event, the trade declarations in support of the opposition are from within the Sydney area and are from traders who say that they are aware of the expression ‘smart home solutions’ within the home automation industry and that they have an honest requirement to use it in the course of trade. As I have observed, I am inclined to accord these declarations weight.
There is an added difficulty in that the trade mark as used by the applicant is not the trade mark filed by the applicant. In use, the black block within the trade mark is significantly larger. However, I do not think that the filing of the trade mark the applicant in fact uses would have saved the application from the considerations in Bayer and Oregon.
Moreover, I think that in these sorts of situations, where the trade mark prima facie lacks any inherent adaptation to distinguish and the applicant states that it now relies on ‘get-up’, it is only the trade mark which is actually used by the applicant that could ever be registered, if the alleged get-up is actually present and subject to suitable restrictions and limitations which adequately reflect where the applicant’s rights lie. In short, however, the very slight evidence which is from before the relevant date which is claimed to show the opposed trade mark in use does not, in fact, show such use.
Nor, if the evidence had been without these problems, do I consider that the opposed trade mark had moved any way towards distinguishing the applicant’s services at the relevant date. The words SMART HOME SOLUTIONS, like the examples of the words ‘catering solutions,’ or ‘management solutions,’ are a simple statement of what the services are, or provide, such that any traders are likely to need or require to use them in respect of their similar services without improper motive. These words have not altered their meaning through use to indicate the services only of the applicant whether in Sydney or elsewhere in Australia – consequently the trade mark as a whole does not distinguish the services of the applicant.
The opponent has established its ground of opposition under section 41 of the Act.
There is no need for me to consider the ground under section 59.
Decision
Section 55 of the Act 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.
60. I refuse to register application 955049.
Costs
I award costs at the official scale set out in the regulations against the applicant.
Ian Thompson
Hearing Officer
Trade Marks Hearings
27 May 2008
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