David Parker v AVC Operations Pty Ltd

[2022] ATMO 71

TRADE MARKS ACT 1995

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

Re:Opposition by Phusion Projects LLC to registration of trade mark application numbers 2030048 LOCO figurative and 2030052 LOCO with device (both in class 33) - in the name of 21 Beverages Pty Ltd.

Delegate:	Tracey Berger
Representation:	Opponent: Henry Hughes IP Limited Applicant: One IP International Pty Ltd
Decision:	2022 ATMO 72 Trade Marks Act 1995 (Cth) – opposition under section 52 – grounds of opposition pressed under sections 44 and 59 – section 44 established - trade marks refused registration.

Background

1. This is a decision on the opposition by Phusion Projects LLC (‘Opponent’) to registration of the following trade marks in the name of 21 Beverages Pty Ltd (‘Applicant’) both filed on 14 August 2019 (‘Relevant Date’) in class 33 for “pre-mixed alcoholic beverages, other than beer-based” (‘Applicant’s Goods’):

Trade Mark Number	Trade Mark
2030048	(‘Loco Stylised Mark’)
2030052

(collectively the ‘Applications’ and ‘Trade Marks’ respectively).

1. As required by the Trade Marks Act 1995 (Cth),[1] the Applications were examined, accepted for possible registration and advertised for opposition purposes on 16 June 2020.  The Opponent filed a Notice of Intention to Oppose each of the Trade Marks on 17 August 2020 and a Statement of Grounds and Particulars for each of the Trade Marks on 17 September 2020 (‘SGPs’).  The Applicant filed Notices of its Intention to Defend the Applications from opposition on 8 December 2020.

   [1] Each reference to a section in these reasons is a reference to a section of the Trade Marks Act 1995 (Cth) (‘Act’). Each reference to a regulation in these reasons is a reference to a section of the Trade Marks Regulations 1995 (Cth) (‘Regulations’).

2. Thereafter, the Opponent filed evidence in support of the opposition on 8 March 2021, followed by the Applicant’s evidence in answer lodged on 10 June 2021.  No evidence in reply was filed and the parties were given the opportunity to request a hearing.

3. The parties both requested a hearing by written submissions and paid the requisite fees.  The Opponent filed written submissions on 11 March 2022 (‘Opponent’s Written Submissions’) and the Applicant filed written submissions on 1 April 2022 (Applicant’s Written Submissions’).  This matter was allocated to me to determine in my capacity as a delegate of the Registrar of Trade Marks based on the material filed during the proceedings.

   Grounds and Onus

4. The SGPs nominated grounds of opposition under ss 44 and 59.

5. The Opponent bears the onus of establishing one or more grounds of opposition[2] on the balance of probabilities.[3]  The rights of the parties are to be determined at the Relevant Date.

   [2] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58 [32] (Keane CJ, Stone and Jagot JJ).

   [3] Telstra Corporation Ltd v Phone Directories Co Pty Ltd [2015] FCAFC 156 [133] (Besanko, Jagot and Edelman JJ).

6. As a preliminary point, I note that the Applicant’s Written Submissions are in the form of a declaration made by the Managing Director of the Applicant’s attorneys and includes additional information not in evidence.  The Opponent has objected to this additional information on the basis that it constitutes new evidence and requests that portions of the Applicant’s Written Submissions be disregarded.  Some of the evidence is not relevant to the grounds of opposition claimed and the other parts of the evidence are either undated or after the Relevant Date.  Hence, it is not appropriate or necessary for me to have regard to the additional information constituting evidence that is contained in the Applicant’s Written Submissions.  Even if I was to take into account the additional information, it would not affect my decision below.  

   Evidence

7. The following evidence was filed:

   Evidence in Support

   Declaration of Fergielyn Maneja Catayoc, intern at the Opponent’s attorneys, made on 8 March 2021 with Exhibits FC-1 to FC-11.

   Evidence in Answer

   Declaration of Daniel Nassif, director of the Applicant, made on 10 June 2021 with Exhibits DM-01 to DM-05

   Discussion

   Section 44

8. To successfully oppose the Applications pursuant to s 44, the Opponent must establish that a trade mark registered or applied for by a person other than the Applicant:

   ·     has a priority date which is earlier than that of the Trade Marks (‘the first requirement’);

   ·     is substantially identical with or deceptively similar to the Trade Marks (‘the second requirement’); and

   ·     is in respect of similar goods, and/or services which are closely related to, the Applicant’s Goods (‘the third requirement’).

9. In the SGPs, the Opponent relies on its prior trade mark registration number 1808292 FOUR LOKO (‘Opponent’s Mark’) in class 33 for “Flavored alcoholic beverages except beers; distilled spirits” (‘Opponent’s Goods’), registered from 30 August 2016.  The Opponent’s Mark is in the name of someone other than the Applicant and has an earlier priority date thereby satisfying the first requirement.

10. Further, I consider that ‘flavored alcoholic beverages, except beers” are the same or very similar to “pre-mixed alcoholic beverages, other than beer-based”.  Both are alcoholic beverages (except those containing or consisting of beer) mixed with other ingredients sold through the same trade channels to the same class of consumers.  As the first two requirements are satisfied, I must determine whether the Trade Marks are substantially identical with, or deceptively similar to, the Opponent’s Mark.

11. The Opponent’s Written Submissions concede that the Opponent’s Mark and the Trade Marks are not substantially identical and I agree.  A side by side comparison of FOUR LOKO with each of the Trade Marks reveals obvious differences in the additional element “FOUR”, different spelling of LOKO/LOCO and the stylisations of the Trade Marks.  Neither of the Trade Marks is substantially identical to the Opponent’s Mark.

12. The test for whether trade marks are deceptively similar is broader than the test for whether they are substantially identical and requires that one trade mark  so nearly resembles the other trade mark that it is likely to deceive or cause confusion.[4]

    [4] Act s 10.

13. In determining whether the Opponent’s Mark and the Trade Marks are deceptively similar, I am guided by the longstanding principles relevant to the assessment of deceptive similarity summarised by the Federal Court in Caterpillar Inc. v Puma SE:[5]

    First, the relevant comparison is between the marks themselves.  The comparison assumes a normal and fair use of the application trade mark for all goods or services covered by the application…

    Second, the test is not a “side-by-side” comparison of the marks.  Deceptive similarity is to be assessed by reference to persons who do not have an opportunity to compare the respective marks side-by-side and who may have an imperfect recollection of the marks…

    Third, while the deception or confusion must result from the similarity in the marks, the likelihood of deception or confusion is to be judged not by the degree of similarity alone but by the effect of the similarity in the circumstances.  Confusion may arise from two word marks in a number of ways. The confusion might arise because of the textual similarity of the words, or because of the phonetic similarity of the words when pronounced, or there may be conceptual confusion where consumers might think that the product bearing the impugned mark is a variant of, or related to, an existing brand…

    Fourth, confusion includes being left in doubt or having cause to wonder.  The creation of an incorrect belief or mental impression and causing confusion “… may go no further than perplexing or mixing up the minds of the purchasing public…”

    Fifth, it is not necessary to establish that confusion is more probable than not; likelihood is established if there is a real risk, that is a finite, non-trivial risk, of confusion.  It is enough if the ordinary person entertains a reasonable doubt…

    Sixth, no intention to deceive or cause confusion is required, although it may nevertheless be a relevant factor to take into account in the evaluation of deceptive similarity if the defendant did have that intention.[6]

    [5] [2021] FCA 1014, (O’Bryan J).

    [6] Ibid, [90]-[96] (citations omitted).

14. The essential element of the Trade Marks is the word LOCO which is aurally identical to the essential element LOKO of the Opponent’s Mark.  The other elements in the marks, namely the additional word FOUR in the Opponent’s Mark, the full stop and backgrounds of the Trade Marks, are not particularly distinctive.  The dominant element of the Trade Marks and the manner in which consumers are likely to recall them is by the word element LOCO.  Similarly, the memorable element of the Opponent’s Mark is LOKO.

15. The backgrounds of each of the Trade Marks are mere decoration and not elements that I believe consumers are likely to recall with any real clarity.  Further, notional use of the Opponent’s Mark could include the use of the mark in white font on a black background, similar to the Loco Stylised Mark.[7]  In Carlton and United Breweries Limited v Melbourne Bros (‘Melbourne Bitter Decision’),[8] in considering the deceptive similarity of two marks for beer, Hearing Officer Zars commented:

    I consider therefore that most purchasers, having become accustomed to features repeated in other marks for alcoholic beverages would largely overlook the device elements in the applicant’s mark.

    [7] See Act s 70(3) which states ‘to the extent that a trade mark is registered without limitations as to colour, it is taken to be registered for all colours’.

    [8] [1999] ATMO 111.

16. Conceptually, the two marks convey a similar idea.  LOKO is slang for ‘crazy’ and LOCO is Spanish for ‘crazy’.  The element FOUR in the Opponent’s Mark does not change the meaning.  For those not familiar with the slang meaning of LOKO or Spanish word LOCO, the two words appear to be invented.  The impression of the two marks carried away by consumers of the Trade Marks and Opponent’s Mark is likely to be the same or similar, regardless of whether consumers are familiar with the meaning of LOKO/LOCO.

17. The two sets of goods are essentially the same and will be sold through the same trade channels being liquor stores or licensed premises and are directed to the same class of consumer.  Pre-mixed or flavoured beverages are, in my opinion, generally purchased without a detailed study of the products on offer or by asking for the goods.  The Opponent’s Written Submissions refer to the delegate’s comments on purchasing of alcoholic beverages in the Melbourne Bitter Decision:

    When customers ask for beer at a hotel or other outlet, the most obvious manner of doing so would be by reference to the prominent words featured in the marks. Considering the word MELBOURN, any significance the omission of the letter "E" might have in distinguishing it from the conventional spelling of the word MELBOURNE, becomes non-existent in terms of sound. As to the words BROS. and BITTER, while there are noticeable differences in the appearance, structure and meaning between these words, any distinguishing features would considerably diminish in their pronunciation where they are prefixed by an identical word and both begin with the same letter 'B'. This factor is particularly significant in situations where there is the likelihood that the goods could be ordered in a noisy environment as might be in the present situation if, for example, the drinks are ordered in a crowded bar, or a busy retailing store. Indeed, the declarants in the opponent's evidence state that the vast majority of orders for the opponent's beer at a retail level are made orally, and, in doing so, many customers even shorten the brand name to MELBOURNE, rather than order their choice of the opponent's beer by the correct description MELBOURNE BITTER. Furthermore, given the close oral similarity between the marks, consideration should also be given to confusion likely to arise during telephone conversations - "Rheinliebling" Trade Mark [1966] RPC 68. Thus, in the present case, verbal identification of the opponent's marks by the consumers is an important feature in procuring beer under the label MELBOURNE BITTER, necessitating that due consideration be given to the "effect of spoken description" of the marks.[9]

    [9] Ibid.

18. The Opponent contends that the present situation is similar in that the element ‘FOUR’ in the Opponent’s Mark may be missed in a noisy environment or the brand could be abbreviated to LOKO.  I agree that aurally LOKO is the stronger sounding and more memorable part of the Opponent’s Mark especially if there is background noise at the time of purchase.  Hearing Officer Richards commented on the impact of the environment in which alcoholic beverages are often purchased in Skyy Spirits, LLC v Blue Sky Brewery Holdings Pty Ltd[10] stating:

    In considering the nature of the goods in which the Opponent has a reputation, being small relatively cheap consumable items, the circumstances in which they are purchased becomes relevant. They may be purchased in bars or nightclubs which can be dimly lit, noisy and crowded environments. When in this situation, alcoholic beverages will often be ordered by name from behind a bar, relatively distant from the product itself. Normal use of the goods will tend to cause a degree of inebriation. Even when ‘exceptional carelessness or stupidity’ is disregarded, the circumstance in which the goods may be bought and sold adds to the likelihood of deception or confusion.

    [10] [2016] ATMO 21, [25].

19. The Opponent also argues that in the context of asking for the Opponent’s Goods, a statement such as “I’m looking for FOUR LOKO” could easily be interpreted as “I’m looking ‘for’ LOCO” or as a request for a four pack of LOCO drinks given flavoured alcoholic goods are often sold in packs of four.

20. The Applicant argues that there have been no instances of actual confusion.  However, evidence of actual confusion is not necessary[11] and the Applicant attests that the Trade Marks were not in use at the Relevant Date.  In the absence of any evidence of the Applicant’s use of the Trade Marks at the Relevant Date, I do not need to consider whether ss 44(3) or 44 (4) applies. 

    [11] Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Ltd (2002) 117 FCR 189, [62] (Weinberg and Dowsett JJ); NEC Corp v Punch Video (S) Pte Ltd [2005] FCA 1126, [37] (Branson J).

21. I am satisfied that there is a real danger of confusion between the Trade Marks and the Opponent’s Mark such that each of the Trade Marks are deceptively similar to the Opponent’s Mark. The s 44 ground of opposition is established.

    Decision and Costs

22. The Opponent has established a ground of opposition under s 44. Accordingly, I refuse to register trade mark numbers 2030048 and 2030052.  Noting the appeal period, this refusal will be recorded one month from the date of this decision unless the Registrar of Trade Marks is served with a notice of appeal.  If an appeal is filed, the disposition of these oppositions will be for the Court. Otherwise, the disposition of the Applications should be in accordance with the Court’s order or direction.

23. The Opponent has requested an award of costs and hence I award costs in respect of trade mark number 2030048 against the Applicant under s 221 in the applicable amounts set out in Schedule 8 of the Regulations. In respect of trade mark number 2030052, I award reduced costs against the Applicant in the same manner as indicated in Hume Industries (Malaysia) Berhad v James Hardie & Coy Pty Ltd.[12]

    [12] [2001] ATMO 78.

    Tracey Berger
    Hearing Officer
    Delegate of the Registrar of Trade Marks
    10 May 2022