Deckers Outdoor Corporation v Luda Production Pty Ltd

TRADE MARKS ACT 1995

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS
Re:Opposition by Deckers Outdoor Corporation Inc to registration of trade mark applications 1013798 (25) - UGG AUSTRALIA label
1013806 (25) – MADE BY UGG AUSTRALIA
1013807 (25) – MADE BY UGG AUSTRALIA label

all filed in the name of Luda Production Pty Ltd.

Delegate: Alison Windsor

Representation: Opponent: Sam Ricketson of counsel, instructed by Middletons Lawyers
Applicant: Celia Davies of Freehills Patent & Trade Mark Attorneys

Decision: 2010 ATMO 88
S52 opposition: Grounds pressed under ss 42(b), 43, 44, 58, 58A, 60 and 62A. No grounds established – applications to proceed to registration – costs awarded against opponent.
Background

On 2 August 2004, Luda Production Pty Ltd (‘the applicant’) filed applications to register three trade marks in class 25. The trade marks are as follows:

1013798

1013806

MADE BY UGG AUSTRALIA

1013807

The applications were examined as required by section 31 of the Trade Marks Act 1995 (‘the Act’), and all three attracted grounds for rejection under sections 41 and 44. The applicant provided evidence of use in support of the applications, resulting in application 1013798 being accepted for possible registration under the provisions of subsections 41(5), 44(4) and paragraph 44(3)(b).[1] Applications 1013806 and 1013807 were accepted pursuant to the provisions of both subsections 41(5) and 44(4).
[1] The 44(3)(b) matter related to the presence in the trade mark of the Advance Australia logo subject of trade mark registration 451318. The trade mark was subsequently amended to remove the logo.
All three applications were eventually advertised as accepted for possible registration in the Australian Official Journal of Trade Marks on 6 September 2007. Each application was accepted for the following goods in class 25: ‘footware (sic) being sheepskin boots and headgear’.
After being granted an extension of time for the purpose, on 7 January 2008 Deckers Outdoor Corporation Inc (‘the opponent’) filed notice of opposition to registration of the three applications.
Evidence in support, in answer and in reply were filed in due course. Both parties then requested to be heard. The matter was set down for hearing in Melbourne on 9 June 2010.
However, on 28 May 2010 the applicant filed and served an application for permission to adduce further evidence. The evidence, which consisted of a single declaration without any exhibits, accompanied the application. Because the hearing itself was imminent, and as neither party had any objections, it was decided to deal with the application on the day of the hearing, prior to hearing the substantive matter.
The parties appeared before me, as a delegate of the Registrar of Trade Marks, in Melbourne on the appointed day. The opponent was represented by Sam Ricketson of counsel instructed by Middletons Lawyers. The applicant was represented by Celia Davies, a partner of Freehills Patent & Trade Mark Attorneys.
Notice of opposition, grounds of opposition pursued and onus
The notice of opposition nominated fourteen grounds of opposition, effectively encompassing all grounds provided for by the Act and likely to be relevant to the opposition. At the hearing, the opponent pursued the grounds under sections 44, 58, 58A, 43, 42(b), 60 and 62A. As a preliminary issue, I have decided that the grounds which were not pursued at the hearing have not been established.
The onus is upon the opponent to establish one or more of its grounds of opposition. Gyles J has referred to the appropriate standard of proof required in terms of a ‘balance of probabilities’.[2] His findings upon that issue, arrived at after a comprehensive consideration of the relevant authorities, have more recently been discussed with approval by Sundberg J in Chocolaterie Guylian NV v Registrar of Trade Marks.[3]
[2] Pfizer Products Inc v Karam [2006] FCA 1663 (1 December 2006); (2006) 70 IPR 599.
[3] [2009] FCA 891 (18 August 2009), paragraphs 22-27; (2009) AIPC 92-355; (2009) 82 IPR 13
Evidence
The evidence consists of the following declarations:
Evidence in support
·Constance X Rishwain with exhibits CR-1 to CR-7, dated 5 May 2008
·Brian D Smith with exhibits Smith-1 to Smith-10, dated 5 July 2008 (Smith 1)
·Lisa Maree Egan with exhibits A and B, dated 7 August 2008 (Egan 1)
Evidence in Answer
·Lena Fishman with exhibits LF-1 to LF-29, dated 6 August 2009 (Lena 1)
·Luda Fishman, dated 6 August 2009
·Vlad Jurkiw with exhibit VJ-1, dated 5 August 2009
Evidence in Reply
·Brian D Smith with exhibits Smith-11 to Smith-21, dated 1 December 2009 (Smith 2)
·Lisa Maree Egan with exhibits C and D, dated 4 December 2009 (Egan 2)
At the beginning of the hearing, I advised both parties that I would take submissions in relation to the application for further evidence. The opponent stated that it had no objections to the evidence being allowed as it consisted of material which served to clarify previously provided evidence and was not anything new. The further evidence therefore forms part of the material I have considered. It consists of a second declaration by Lena Fishman, dated 28 May 2010 (Lena 2).
The opponent’s evidence – the Smith declarations
In his two declarations, Brian Smith provides a history of the development of trade marks featuring the word ‘UGG’ used in his sheepskin footwear business from approximately 1979 up to the time he sold it to the opponent in 1995.
At paragraph 2 of his first declaration, Mr Smith says the following:
In the late 1970s I emigrated from Australia to the United States. No later than 1979 I began selling sheepskin boots imported from Australian in the United States using the trade mark UGG. I ran my sheepskin footwear business continuously from no later than 1979 until 1995. During that period my business was organised under various names including UGG Imports, Inc., UGG America, Inc., UGG International, Inc., and UGG Holdings, Inc., and also included various different partners and ownership.
He says that from no later than 1983, he began using a stylized trade mark which prominently included the words ‘Ugg Australia’ and which was attached to the footwear in Australia before being exported to Mr Smith in the USA. A copy of this trade mark appears below:
(‘the opponent’s first logo mark’)
Mr Smith registered this trade mark with the United States Patent and Trade Marks Office under registration 1460992, with a priority date of 13 October 1987. The trade mark was registered for the following goods in class 25: ‘Footwear, namely boots made of sheepskin’. The registration notes 1983 as the date of first use in the United States.
The Smith 1 declaration states that the stylised representation of the trade mark used in the business was modified over time. The opponent’s first logo mark was used ‘from no later than the mid 1980s through no later than 1991 when the stylized presentation of UGG AUSTRALIA was modified’. The modified form which Mr Smith states his business began to use no later than 1991 and which was still in use when the opponent bought the business is shown below:
(‘the opponent’s second logo mark’)
The Smith 2 declaration contains estimated annual sales figures for the business for the years 1989 to 1995. These figures are impressive, showing a doubling of already significant sales value between the years 1994 and 1995. Mr Smith estimates that he sold over half a million pairs of footwear over the period covered by the sales figures. He expresses his belief that over the period (from the mid 1980s to 1995) his business was one of the largest sellers of sheepskin footwear in the world. Most of this footwear was made in Australia, and Mr Smith states his belief that his UGG AUSTRALIA branded footwear was known within the sheepskin footwear trade in Australia.
The declaration exhibits a number of articles from Australian magazines and newspapers which refer to his footwear products, most of which make reference to the word ‘Ugg’ and his business name at the time, if not to any specific trade mark.
Mr Smith states that during the period from 1979 to at least 1995 the size of his business necessitated his purchasing significant quantities of sheepskin footwear from Australian suppliers. He states that he was familiar with the sheepskin footwear manufacturing industry in Australia during this period, but was not aware of the applicant, or of any use of the words ‘Ugg Australia’ on labels by any other traders.
The Rishwain declaration
Constance Rishwain is president of the opponent’s UGG Australia division, and has held that position since 2002. She states that the opponent acquired Ugg Holdings Inc, Brian Smith’s business, in 1995. As a result of the acquisition of UGG Holdings Inc, the opponent took ownership of the opponent’s first and second logo marks as well as of the trade mark registration referred to in paragraph 15.
Ms Rishwain states that the opponent initially used the opponent’s second logo mark which Mr Smith had in use at the time the business changed hands. In about 1997, the representation was modified to the form shown below:
(‘the opponent’s third logo mark’)
In 1999, Ms Rishwain says, the trade mark was again modified to the following form which was still in use at the time the declaration was made:
(‘the opponent’s fourth logo mark’)
Ms Rishwain states that one of the opponent’s logo marks was attached to the opponent’s footwear by the manufacturers in Australia before the goods were exported to the United States for ultimate sale.[4] She states that when the opponent acquired Mr Smith’s business in 1995, many thousands of pairs of footwear bearing one of the opponent’s logo marks were being manufactured in Australia each year. The opponent successfully expanded the business after acquiring it and the number of pairs of branded boots exported from Australia steadily increased. Ms Rishwain says that the opponent continues to manufacture footwear bearing one of the opponent’s logo marks in Australia as well as in other locations.
[4] I note that s228(1) of the Act provides that the application in Australia of a trade mark to goods to be exported from Australia is taken for the purposes of the Act to constitute use of the trade mark in Australia in relation to those goods.
“Decker’s UGG AUSTRALIA trade mark is widely known in the footwear trade in America and other countries around the world”, Ms Rishwain says. She states that sales for the brand in 2007 were over AUD$300 million. She also states that the opponent spends several million dollars every year to promote the brand worldwide.
The Egan declarations
Lisa Egan is a senior associate of Middletons, the law firm representing the opponent in this opposition. The Egan 1 declaration provides as its exhibits chronologies of the claimed use by both opponent and applicant of the words ‘Ugg Australia’. As references for the chronologies, Ms Egan stated that she has read the opponent’s evidence in support, as well as two declarations made by Lena Fishman, dated respectively 11 August 2006 and 18 May 2007. These two declarations were provided by the applicant in support of its applications during the examination process.
The two earlier Fishman declarations have not been served and filed as evidence in support of this opposition. However, given that it is the opponent who is referring to the information contained in them, it stands to reason that both parties are familiar with the content. I will therefore include their contents in making my decision.
The chronologies which Ms Egan has provided claim that the opponent (or its predecessor in title, Brian Smith) has used the words ‘Ugg Australia’ on its sheepskin products since the early 1980s, while the applicant has used them only since the early 1990s.
The second Egan declaration refers to some examples of newspaper articles published in Australia on the subject of the Mr Smith’s business and which were exhibited to his second declarations. Ms Egan’s declaration includes reference to research on the likely readership of each publication at the time, with intention, I infer, of attempting to define the likely exposure of the articles within the general population.
The applicant’s evidence – Lena Fishman’s declarations
In all, taking into account the two declarations submitted during the course of examination of the applications, Lena Fishman has provided four declarations which contain information in respect of the applicant’s trade marks. Much of the information is repeated in different declarations. What I provide here is a summary of the relevant information.
Ms Fishman states that her parents, Luda and Roman Fishman, founded the business in around 1981 when they began manufacturing and selling sheepskin boots, hats, mittens, jackets and vests in Australia.[5] From sheepskins bought from their sheepskin supplier at the time, the Fishmans made four styles of hats and three styles of boots which were sold at stalls in the Queen Victoria Market in Melbourne.
[5] Ms Fishman states that while the business has produced boots, mittens and hats continuously since 1981, the production of jackets and vests has not been continuous.
The Fishmans registered the business name Luda Textiles Co in Victoria on 17 March 1982. The applicant was incorporated in August 2004 to take over the Luda Textiles business. Ms Fishman says that the applicant and its processor have continuously manufactured and sold sheepskin boots, mittens and hats since 1981 up to the present.
The term ‘UGG Australia’, Ms Fishman says, was coined and first used in 1982 in respect of the applicant’s sheepskin products. She says that over time it has been used on the goods in a number of variations including the following:
- UGG AUSTRALIA
- “UGG” AUSTRALIA
- UGG AUSTRALIA PTY LTD
- MADE BY “UGG” AUSTRALIA
- MADE BY UGG AUSTRALIA (collectively ‘the applicant’s UGG trade marks’)
Ms Fishman says that the earliest labels applied to boots made by the applicant were stamped onto the heel counter of each boot, and her first declaration provides a photograph of the embossing stamp used from 1982 until the mid 1980s. The resultant impression as it appeared on a boot is shown below:
These stamps were replaced in the mid 1980s by a woven label which was attached to the heel counter of each boot, and which is shown below:
Ms Fishman says that in the early 1990s the applicant began using the phrase MADE BY UGG AUSTRALIA (alternatively rendered as ‘MADE BY “UGG” AUSTRALIA) as a trade mark in respect of its products. She says that trade mark has been in continuous use since that time on labels, swing tags and advertising materials. Examples of the labels which Ms Fishman says have been affixed to the boots since the mid 1990s are shown below. She also notes that there was a period of overlap in the use of the different versions of the labelling and they may have all been in use concurrently for at least some period of time.
Ms Fishman states that in the mid 1990s the applicant had registered UGG Australia as a business name in Victoria, New South Wales, Queensland, South Australia and Tasmania in the belief that it would afford some form of protection for their brand. In 2000 a company related to the applicant changed its name to Ugg Australia Pty Ltd. The company name was also registered as a means of protecting ‘UGG AUSTRALIA’ as a trade mark nationally, Ms Fishman says. From that time, the company name was adopted into the labelling used in respect of the goods.
From about 1986, as well as the labels on the heel counters, each sheepskin product manufactured and sold by the applicant had a swing tag attached, all of which incorporated the words UGG AUSTRALIA.[6] Retailers of the goods could attach price and sizing information to each product by using the swing tags. Over time, Ms Fishman says, the appearance of the swing tags has changed. The font, colour and shape has varied over time. However, the trade mark UGG AUSTRALIA has always been present on the tags. Since 2000 the tags have all carried the company name UGG AUSTRALIA PTY LTD. An example of one of the swing tags is shown below:
[6] Ms Fishman has not been specific here, but I take this to mean that boots, hats and mittens all had the swing tag attached. Prior to this reference, she appeared only to be referring to sheepskin boots.
Ms Fishman also comments about the geographic extent of the applicant’s sales. She says that she accompanied her mother on occasions in attending various trade and gift fairs in the 1980s with a view to expanding national sales of the applicant’s sheepskin products. In about 1989, she says, the applicant appointed sales agents in the footwear and tourism markets to sell its products in each Australian state and territory. The applicant also employed a sales agent who specialized in supplying Duty Free retailers Australia wide. These agents were employed until about 2004 when they were replaced by sales representatives.
In respect of sales, Ms Fishman makes the following comments:
- The applicant both wholesales and retails sheepskin products bearing one of its UGG trade marks. The wholesale accounts include some well known retailers such as Myers, David Jones, Birkenstock and Australian Way.
- By 2004, the applicant was selling products to around 400 or 500 retail outlets Australia wide. By 2009 that figure had risen to 600 – 700 retail outlets.
- The retail outlets are and have been market stalls and carts in shopping centre corridors, as well as at the Queen Victoria Markets in Melbourne.
- The applicant sells approximately 150,000 pairs of sheepskin boots annually throughout Australia, all of which bear the UGG AUSTRALIA trade marks.
Ms Fishman states her belief that the sheepskin boots bearing one of the applicant’s UGG marks ‘over the past decade have accounted for approximately 75% of all sheepskin boot sales in Australia. I am basing this figure on competitor analysis, current customer sales figures and market intelligence’. She also says that at the time she began working full time with the applicant in 2002, she was not aware of any competitors in the relevant market in Australia who used trade marks containing or comprising the elements UGG, UGH, UGG AUSTRALIA or UGH AUSTRALIA. She states that she was aware, however, that the element ‘ugg’ was used descriptively in the sheepskin boot market.
Other declarations
Luda Fishman and Vlad Jurkiw also provided declarations in support of the applications. Mrs Fishman’s declaration gives some history of the applicant’s business and her efforts in protecting the trade marks the applicant was using. She also states that she has only become aware of other products being sold bearing variations of the element UGG within the four to six year period prior to the date of her declaration. She says:
In the past few years, many such marks have appeared, but to the best of my knowledge, the use of these marks has not caused any confusion or deception in the marketplace with the applicant’s UGG AUSTRALIA products. I believe this is because each mark has different words and stylizations which differentiate them.
The Jurkiw declaration exhibits a copy of a declaration he made during the examination phase of the trade marks. Mr Jurkiw stated at the time that he was contracted as a sales and marketing consultant to the Australia Made Campaign Ltd, the registered owner of the ‘Australian Made’ trade mark (registration no. 451318). The declaration refers to his knowledge of the applicant’s use of the UGG AUSTRALIA and MADE BY UGG AUSTRALIA trade marks. He notes that that in 1992 his company approved the applicant’s products and its marketing material as suitable to bear the Australian Made trade mark.
Discussion and reasons
The opponent submitted that it was the owner of four registered and pending trade marks in Australia and provided their details. However, as only one of the four has an earlier priority date than the applications under opposition, it is the only one relevant to this matter. The relevant registration is number 785466, registered from 12 February 1999 for ‘footwear, including boots, shoes, and clogs’ in class 25. The trade mark is the following:

During the course of examination this registration was raised as a ground for rejecting all three of the applicant’s trade marks. In each case, the application was accepted for possible registration on the basis of the examiner’s satisfaction that the applicant had demonstrated use of the relevant trade mark before the priority date of the registered trade mark. The provisions of subsection 44(4) were applied in the applicant’s favour in each case, and the applications were endorsed as accepted under that provision.
Section 44 of the Act relevantly provides the following:
Section 44. Identical etc. trade marks
(1) Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant's trade mark) in respect of goods (applicant's goods) must be rejected if:
(a) the applicant's trade mark is substantially identical with, or deceptively similar to:
(i) a trade mark registered by another person in respect of similar goods or closely related services; or
(ii) a trade mark whose registration in respect of similar goods or closely related services is being sought by another person; and
(b) the priority date for the registration of the applicant's trade mark in respect of the applicant's goods is not earlier than the priority date for the registration of the other trade mark in respect of the similar goods or closely related services.
Note 1: For deceptively similar see section 10.
Note 2: For similar goods see subsection 14(1).
Note 3: For priority date see section 12.
Note 4: The regulations may provide that an application must also be rejected if the trade mark is substantially identical with, or deceptively similar to, a protected international trade mark or a trade mark for which there is a request to extend international registration to Australia: see Part 17A.
(2) ….
(3) If the Registrar in either case is satisfied:
(a) that there has been honest concurrent use of the 2 trade marks; or
(b) that, because of other circumstances, it is proper to do so;
the Registrar may accept the application for the registration of the applicant's trade mark subject to any conditions or limitations that the Registrar thinks fit to impose. If the applicant's trade mark has been used only in a particular area, the limitations may include that the use of the trade mark is to be restricted to that particular area.
Note: For limitations see section 6.
(4) If the Registrar in either case is satisfied that the applicant, or the applicant and the predecessor in title of the applicant, have continuously used the applicant's trade mark for a period:
(a) beginning before the priority date for the registration of the other trade mark in respect of:
(i) the similar goods or closely related services; or
(ii) the similar services or closely related goods; and
(b) ending on the priority date for the registration of the applicant's trade mark;
the Registrar may not reject the application because of the existence of the other trade mark.
Note 1: An authorised use of the trade mark by a person is taken to be a use of the trade mark by the owner of the trade mark (see subsection 7(3)).
Note 2: For predecessor in title see section 6.
Note 3: For priority date see section 12.
In order to establish the section 44 ground of opposition in respect of subsection 44(1), the opponent must be able to point to a trade mark on the Register which meets all the following criteria:
·     it is substantially identical with or deceptively similar to the applicant’s trade marks;
·     it is owned by someone other than the applicant;
·     it has a priority date earlier than that of the applicant’s trade marks and
·     it is registered for the same or similar goods[7] as those of the applicant.
[7] As defined in s14(1) of the Act.
In this respect, the opponent has relied on its registration number 785466, shown previously. This registration has a priority date several years earlier than that of the applications, and it covers the same or similar of goods as those covered by the three applications.
The opponent submitted that while there might be some argument over whether the trade marks were substantially identical, there could be little doubt that they were deceptively similar. I consider it to be clear that the trade marks involved here are substantially identical. My reasons for this follow.
The term ‘substantially identical’ is not defined in the Act but the accepted tests are well known and often quoted. Substantial identity is to be assessed according to the test in Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd,[8] per Windeyer J at page 414:
In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison. “The identification of an essential feature depends”, it has been said, “partly on the Court’s own judgment and partly on the burden of the evidence that is placed before it”: de Cordova v. Vick Chemical Co. (1951) 68 RPC 103, at p 106. Whether there is substantial identity is a question of fact: see Fraser Henleins Pty Ltd v. Cody [1945] HCA 49; (1945) 70 CLR 100, per Latham C.J. (1945) 70 CLR, at pp 114, 115, and Ex parte O’Sullivan; Re Craig (1944) 44 SR (NSW) 291, per Jordan C.J. (1944) 44 SR (NSW), at p 298, where the meaning of the expression was considered.
[8] [1963] HCA 66; (1963) 109 CLR 407
For ease of comparison, the four trade marks under consideration are shown below:

MADE BY UGG AUSTRALIA

785466 1013798 1013807 1013806
The essential feature of the opponent’s registered trade mark and also of the three trade mark applications are the two words ‘UGG Australia’. These are the words by which goods produced by both trade mark owners will be identified in the relevant market. While there is additional material in each of the trade marks, this material is secondary in all cases to the words ‘UGG Australia’. Even the sun-like device in the opponent’s trade mark is subsidiary to the words. It is my view that the similarities in the trade marks far outweigh their differences, resulting in “a total impression of resemblance” between the trade marks. I consider the applicant’s three trade marks to be substantially identical to the opponent’s nominated registered trade mark.
For completeness, however, I note that since I have found the trade marks to be substantially identical, it stands to reason that they are also deceptively similar. French J in the Woolworths Metro case[9] gave detailed consideration to the matter of deceptive similarity when he said the following:
[9] Registrar of Trade Marks v Woolworths Ltd (1999) 45 IPR 411 at 428
In Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 at 594–5, which concerned the 1905 Act, Kitto J set out a number of propositions which have frequently been quoted and applied to the 1955 Act. The essential elements of those propositions continue to apply to the issue of deceptive similarity under the 1995 Act. Applied also to service marks and absent the imposition of an onus upon the applicant they may be restated as follows:
(i) To show that a trade mark is deceptively similar to another it is necessary to show a real tangible danger of deception or confusion occurring. A mere possibility is not sufficient.
(ii) 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.
(iii) 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.
(iv) The rights of the parties are to be determined as at the date of the application.
(v) The question of deceptive similarity 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 Bali Co Inc (1973) 129 CLR 353 at 362 ; 1 ALR 443 at 450:
… 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.
I am satisfied that theoretically there is likely to be a real tangible danger of deception or confusion between these trade marks if they were all to appear in the same market for the same goods. It is thus possible to say that the requirements of section 44(1) have been met in respect of the opponent’s registration.
Section 44(4) – prior use
Section 44(1) is subject to the provisions of subsections (3) and (4) of section 44. The three applications were all accepted for possible registration on the basis of prior continuous use as envisaged by the provisions of subsection 44(4). If I find that the provisions of this subsection are appropriate to these applications, the opponent’s apparent success in establishing the section 44 ground of opposition will be negated.
At the hearing Mr Ricketson, on behalf of the opponent, advised that he wished to further develop his submissions in respect of the application of subsection 44(4) to the matter and requested further time in which to do so. I agreed to adjourn the hearing in respect of that matter alone, and allow an additional two weeks for Mr Ricketson to provide me with his submissions. I allowed the applicant’s representative a similar amount of time in which to respond. Both parties provided me with their submissions within the time allowed, and I have included these submissions in my consideration of the matter.
Subsection 44(4) allows an application to proceed in the face of a trade mark owned by another party which meets the requirements of sections 44(1) or 44(2). If the Registrar is satisfied that the applicant has continuously used its trade mark for a period beginning before the priority date of that earlier trade mark and ending on the priority date of the applicant’s trade mark, then the Registrar “may not reject the application because of the existence of the other trade mark”.
At the examination stage, once it has been determined that there is an earlier trade mark which creates a bar to the acceptance of an application, the applicant is usually informed of the availability of the provisions of subsections 44(3) and 44(4). An information sheet about evidence of use appropriate for the purpose is attached to the report. In this case, the applicant provided evidence of use for all three trade mark applications. The evidence satisfied the examiner that subsection 44(4) should be applied in the applicant’s favour and the three applications were accepted under that provision.
Mr Ricketson submitted that the wording of subsection 44(4) requires that any use upon which the applicant relies in a claim for prior use of its trade marks must clearly demonstrate use of the exact same trade mark. He argued strongly that the provisions of section 7(1)[10] had no place in the consideration of the trade mark for the purposes of subsection 44(4). He submitted the following:
The proper interpretation of sub 44(4)
This provision needs to be read in the context of section 44 as a whole.
Subsections 44(1) and (2) are concerned with preventing the registration of a trade mark (the “applicant’s trade mark”) where this is substantially identical with, or deceptively similar to, one that is already registered or the subject of a prior application for registration for the same goods or services or goods or services that are closely related. These are primarily filtering provisions to prevent the registration of similar marks, reflecting a legislative policy that the first in time takes precedence and that the register should not contain a series of registered marks of different owners that are similar or confusingly similar to each other.
Subsections 44(3) and (4) then provide for 2 exceptions to this general restriction on registration, allowing for concurrent registration where:
a. there has been “honest concurrent user” of the 2 marks, that is, of the mark already on the register or in the process of being registered, and the applicant’s mark), or there are “other circumstances” that make concurrent registration “proper”; or
b. the applicant has previously and continuously used its mark before the registration of the other mark (leaving aside any issues that might arise under other provisions of the Act, such as s 60: see further McCormick & Co Inc v McCormick (2000) 51 IPR 102).
[10] Section 7. Use of trade mark
The language of subs 44(4) is quite explicit: it refers only to the use by the applicant or a predecessor in title of the “applicant’s mark”. This is not qualified by such phrases as “substantially identical” or “deceptively similar” as in subss 44(1) and (2).
It is therefore submitted that this can only refer to the same mark for which registration is now being sought, not one that has even small differences or variations from that mark.
The reason for this is clear: the applicant in such a case is seeking to avoid the application of the filtering provisions under subss 44(1) and (2), and should not be able to do so by relying on the use of versions of its mark that differ from the mark or marks actually applied for. In order for subs 44(4) to apply, the mark must already have been shown to be substantially identical with or deceptively similar to one already on the register: the issue of prior continuous user can therefore only properly be tested by asking whether there has been such use of that mark, not of some substitute or alleged equivalent. It is for this reason that subs 44(4) refers only to the “applicant’s mark”, without any further embellishment such as a “substantially identical” or deceptively similar”.
This requirement of exact equivalence is particularly required in a “crowded” area such as the present where there are strong common elements or components in the marks which are competing for registration, such as the words “Ugg” and “Australia”, and where the distinctiveness of such marks, for the purposes of s 41, must turn upon the particular combination of elements chosen by the applicant (the point made by the applicant in its submissions at pars 20-29).
There is no reference to this issue in any of the preparatory[11] or parliamentary materials that accompanied the adoption of subs 44(4) as part of the Trade Marks Bill 1995 and it is not dealt with in commentaries on the 1995 Act, apart from the following passage in Lahore et al, Patents, Trade Marks & Related Rights, at [55,560] which was referred to in the recent opposition hearing:
[11] Including in the report of the Working Party to review the Trade Marks Legislation: Recommended Changes to the Australian Trade Marks Legislation, July 1992.
Similarity of the trade marks
An objection based on s 44(1) or (2) presupposes that the cited mark is substantially identical or deceptively similar to the application mark. It should therefore be self evident that, if the applicant under s 44(4) can only show use of a similar mark, or a “family” of marks to which the application mark is related, that will not be sufficient.
Ms Davies, as expected, did not agree with these submissions. She submitted the following:
The permissive wording of subsection 7(1) confers a discretion on the Registrar in deciding whether to apply subsection 7(1) in respect of use of a trade mark. (AMW Projects Pty Ltd v Ray Mullins & Sons Pty Ltd (2000) 48 IPR 409 at 418)
There is no suggestion in the Trade Marks Act or case law that the Registrar cannot exercise its [sic] discretion in applying subsection 7(1) to subsection 44(4).
Furthermore, there is nothing within section 44 which places such a limitation on subsection 44(4).
The applicant submits that it is a very narrow interpretation of subsection 44(4), and inconsistent with the rest of section 44, to limit the prior continuous use of a trade mark to be the exact copy of the mark for which the registration is now being sought.
None of the three exceptions to subsections 44(1) and 44(2), being honest concurrent use, other circumstances and prior continuous use, expressly state whether use of the applicant’s mark may or may not be with ‘additions or alterations that do not substantially affect the identity of the trade mark’ per subsection 7(1).
I consider, as did Ms Davies, that Mr Ricketson has taken a very narrow view of the application of section 44(4), though understandable in the circumstances. Section 7(1) does gives the Registrar the discretion to consider a degree of variation in the representation of a trade mark and still regard it as use of the trade mark. I do not consider that this discretion is absent from the provisions of section 44(4). While I agree that use of a merely similar trade mark, or a “family” of trade marks is unlikely to serve the purpose, if the applicant’s use of its trade mark is clearly use of a substantially identical trade mark, then that use is relevant for the purposes of the subsection.
The applicant has attested to use of the words ‘UGG Australia’ in various forms over the years. None of the versions are particularly embellished, though some are accompanied by various descriptive additions. All the various versions provided as examples in the evidence of use fall into the category of substantially identical trade marks. All are clearly identified via the words ‘UGG Australia’. There is no other significant identifying feature in any of the applicant’s trade marks when in use. I am satisfied that the applicant has substantiated appropriate use for the provisions of subsection 44(4), and that it is thus appropriate to apply that subsection in the applicant’s favour. The opponent is not successful in establishing its opposition in respect of section 44.
However, the opponent also made submissions in respect of section 58A, and it is appropriate to move on to that section next.
Section 58A – Opponent’s earlier use of a similar trade mark
This section of the Act was introduced as a consequence of the Trade Marks Amendment Act 2006, and provides:
Section 58A. Opponent’s earlier use of similar trade mark
(1) This section applies to a trade mark (section 44 trade mark) the application for registration of which has been accepted because of:
(a) subsection 44(4); or
(b) a similar provision of the regulations made for the purposes of Part 17A.
Note: Subsection 44(4) prevents rejection of an application for registration of a trade mark that is substantially identical with, or deceptively similar to, a registered trade mark or a trade mark whose registration is being sought where the first-mentioned trade mark has been continuously used since before the priority date of the other trade mark.
(2) The registration of the section 44 trade mark may be opposed on the ground that the owner of the substantially identical or deceptively similar trade mark (similar trade mark) or the predecessor in title:
(a) first used the similar trade mark in respect of:
(i) similar goods or closely related services; or
(ii) similar services or closely related goods;
before the owner of the section 44 trade mark or the predecessor in title in relation to the section 44 trade mark first used the section 44 trade mark; and
(b) has continuously used the similar trade mark in respect of those goods or services since that first use.
Note: For predecessor in title see section 6.

The Explanatory Memorandum described the purpose of the new section as follows:
A person may obtain acceptance and registration for a trade mark under section 44(4) even though an earlier similar trade mark has been registered for similar goods and services. The person must be able to show that they have used the trade mark before the filing date of the earlier trade mark on those particular goods or services.
However the owner of the earlier trade mark may have used their trade mark before applying for trade mark registration and accrued common law rights. As it stands the owner of the earlier registered mark has no basis on which to oppose registration of a trade mark accepted under subsection 44(4), even where their use pre-dates that of the accepted application.
The new section will provide a basis for the Registrar to give consideration to these issues in opposition proceedings.
This item creates a new ground of opposition in section 58A to enable the owner of a registered trade mark to oppose registration of a similar mark accepted under the prior use provisions of subsection 44(4). While other grounds may be relevant in a proceeding, the owner of the registered mark will need to establish that their use of the mark predates the use of the accepted application for an opposition to succeed under the new ground.
The matter which the opponent needs to establish is set out in the final sentence of the above quotation. The opponent needs to establish that it has use of its trade mark prior to any use of a relevant trade mark made by the applicant.
The opponent submitted that the applicant cannot clearly show the first date of use of any of its trade marks prior to the actual filing date of the opposed applications. This submission appears to have been made on the premise that the only use of trade marks which can be considered as ‘use’ of the applicant’s trade marks for the purposes of section 44(4) is demonstrated use of the exact trade marks applied for. Previous comments have, I consider, made it obvious that this is not the case. Use of a substantially identical trade mark can be regarded as use of the trade mark for the purposes I need to consider here.
The Smith 1 declaration states that from no later than 1983, Mr Smith began using the opponent’s first logo mark which was attached to the footwear in Australia before being exported to Mr Smith in the USA.[12] This trade mark, which includes a ram’s head as a prominent device is not, according to the tests quoted previously, substantially identical with those of the applicant. When Mr Smith sold the business to the opponent in 1995 he was then using the second logo mark[13], which the opponent continued to use for approximately two years. In ‘about 1997’ the opponent then changed to using the opponent’s third logo mark and changed again in 1999 to the opponent’s fourth logo mark.[14] The opponent stated that it (and its predecessor in business) had used all of these trade marks at various times over the years and that the use of all them thus predates the applicant’s filing date.
[12] See representation at paragraph 14.
[13] See representation at paragraph 16
[14] See representations at respectively paragraphs 21 and 22
Ms Fishman, in her first declaration, states that her parent’s company began using the words ‘UGG Australia’ on sheepskin products from as early as 1982, and provides an example of a heel counter stamp, shown at paragraph 33, which she states was applied to all footwear between 1982 until the mid 1980s.
Neither party in this opposition has provided overwhelmingly persuasive evidence in the nature of actual documents dating back to the earliest days of their claimed use of their trade marks. Much of the information provided in the declarations of both parties is unsubstantiated with actual examples. However, on the basis of what they have provided, I am satisfied that it is more likely than not that the applicant has the earliest use of the term ‘UGG Australia’ in trade within Australia in respect of the goods relevant to this matter. I am not satisfied that the opponent has demonstrated use which meets the requirements of section 58A. It has thus not established this ground of opposition.
Section 58 – applicant not owner of the trade mark.
Section 58 of the Act states that “the registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark”. It is now well established in law that, in order to succeed under this ground of opposition, the opponent must establish three factors. These are:
(i)that the respective trade marks of the applicant and opponent be either identical or substantially identical [15],
(ii)that the respective goods of both parties be the ‘same kind of thing’ [16]
(iii)that the opponent has the earlier claim to ownership based on use prior to both the application to register and any actual use of the mark by the applicant[17].
[15] Carnival Cruise Lines Inc. v Sitmar Cruises Ltd 31 IPR 375 (1994) 120 ALR 495
[16] Re Hicks’ Trade Mark (1897) 22 VLR 636, 3 ALR 75
[17] Settef SpA v Riv-Oland Marble Co (Vic) Pty Ltd 10 IPR 402 at 413
As I have decided that the applicant can claim the earliest use of a relevant trade mark containing the word combination ‘UGG Australia’ as its essential feature, the opponent is unable to establish this ground of opposition.
Section 60 – trade mark similar to one with a reputation in Australia
As the three applications under opposition were filed in 2004, section 60 as it stood at that date prior to amendment pursuant to the Trade Marks Amendment Act 2006 is relevant to these oppositions.[18] The relevant version of section 60 provides:
[18] Apple Computer Inc v Todaytech Group Ltd [2007] ATMO 80
Trade mark similar to trade mark that has acquired a reputation in Australia
The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:
(a) it is substantially identical with, or deceptively similar to, a trade mark that, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, had acquired a reputation in Australia; and
(b) because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.
I have found that the applicant’s three trade mark applications are substantially identical with the opponent’s registered trade mark 785466. I am satisfied that they are also substantially identical with the opponent’s four logo marks referred to earlier in this decision. The opponent has thus met the threshold test for section 60.
The opponent submitted that its evidence of manufacture and export of footwear bearing the opponent’s logo marks, its evidence of sales and world wide promotions point to a significant reputation in its trade marks. It submitted that use of the applicant’s trade marks would be likely to deceive or cause confuse because of this reputation.
I am prepared to accept that the opponent may have a reputation in one or more of the opponent’s logo marks overseas – I am not satisfied, however, that this reputation is significant in the Australian market.
From the evidence the opponent has provided, it appears that the bulk of its sales have occurred overseas, and specifically in the footwear market in the USA. The Rishwain and Smith declarations clearly refer to the manufacture of footwear in Australia, to the attachment of labels bearing the opponent’s logo marks occurring in Australia and to the packaging of boots in Australia into boxes which carry the opponent’s registered trade mark. All of these activities are carried out so that the goods may be exported to the USA and, notwithstanding s228(1) of the Act, would not on the face of it contribute significantly to any reputation the trade marks might garner in Australia. What is missing from this picture is any indication at all of goods bearing the opponent’s logo marks or its registered trade mark being sold anywhere in Australia.
Reputation must be established as a question of fact.[19] While it is not necessary to prove reputation by direct evidence of consumer appreciation; it is commonplace to infer reputation from a high volume of sales, together with substantial advertising and other promotions.[20] This information has not been provided for the opponent’s goods within the relevant Australian market. In addition, the evidence the opponent has put before me in order to suggest that the reputation from the overseas market has flowed over into the Australian market is simply insufficient for the purpose. While there is some indication of a small number of press articles about the opponent and its products having been published in various Australian newspapers, the information is insufficient to point to a significant reputation here.
[19] Lockhart J in Conagra Inc v McCain Foods (Aust) Pty Ltd, (1992) 23 FCR 302
[20] McCormick & Co Inc v McCormick (2000) 51 IPR 102, at 129.
As the opponent has not provided sufficient evidence to support its activities in the Australian domestic footwear market I cannot be satisfied that it has a reputation in its trade marks within Australia. This ground of opposition has not been established.
Section 42(b) – use contrary to law
In respect of this ground of opposition the opponent claimed that use of the applicant’s trade marks would be contrary to law because it would constitute misleading or deceptive conduct within the meaning of sections 52 and 53 of the Trade Practices Act 1974 (‘the TPA’). The relevant TPA sections deal respectively with misleading or deceptive condict and with the making of false or misleading representations.
In order to fall foul of section 52 of the TPA, the applicant must have engaged in conduct that either has already, or is likely to, direct customers to choose their sheepskin boots based on a misapprehension that they actually originate from the opponent company. Before this misapprehension could occur, it would be necessary for one or more of the opponent’s logo marks to have a significant reputation within Australia, and for the applicant to be effectively trading upon that reputation. Likewise, conduct amounting to the making of false representations in contravention of s 53 of the TPA would effectively depend upon the opponent demonstrating that its relevant mark or marks had a significant reputation within Australia.
The opponent has not established to my satisfaction that any of the marks it relies on had the requisite reputation in Australia as at 2 August 2004 nor am I satisfied that the alleged conduct did, or was likely to occur.
As I mentioned previously, on the basis of the information provided to me, I am not satisfied that the opponent has a significant reputation within the Australian market, let along the degree of reputation within Australia which would meet the more stringent requirements of the TPA. The opponent has not succeeded in establishing this ground of opposition.
Section 43 – trade mark likely to deceive or cause confusion
Section 43 provides the following:
An application for the registration of a trade mark in respect of particular goods or services must be rejected if, because of some connotation that the trade mark or a sign contained in the trade mark has, the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion.
The opponent submitted here that the relevant connotation within the applicant’s trade mark was embodied in the words ‘UGG’ and ‘Australia’, and that the applicant’s use of its trade mark would be likely to deceive or confuse because of a perceived connection with the opponent because of its use and claimed reputation in the words.
Section 43 is not intended to be another method of comparing trade marks. That process is undertaken by the provisions of section 44 and such a comparison does not form an objection under the provisions of section 43. This was made clear some years ago in the TGI Friday’s decision.[21]
[21] Big Country Developments Pty Ltd v TGI Friday's Inc (2000) 48 IPR 513
Any connotation within the trade mark must be a secondary implied or associated meaning which would be likely to deceive or cause confusion within the relevant market. I am satisfied that there is nothing within any of the applicant’s three trade marks which can be regarded as constituting a relevant secondary meaning. Therefore I can see no basis on which the opponent could possibly establish its opposition under this section of the Act.
Section 62A – application made in bad faith
Section 62A is another ground of opposition which was introduced as a consequence of the Trade Marks Amendment Act 2006. It simply provides that the registration of a trade mark may be opposed on the ground that the application was made in bad faith.
The opponent submitted it should be inferred that the applicant was aware of the opponent (including its predecessor in business) and of the opponent’s logo marks well before it filed the three opposed applications. The opponent concluded from that inference that the applicant, by filing its three applications, had the intention to ‘cash in’ on the popularity of the opponent’s products. If I accepted this was what had motivated the applicant, the opponent submits that it should succeed under this ground.
I accept that the applicant was aware of the opponent’s trade mark at the time it filed its own applications. Indeed, I have heard these two parties previously in a non-use matter in 2006 involving a relevant trade mark.[22] However, the applicant has been using various versions of trade marks containing or consisting of the words ‘Ugg Australia’ within the Australian domestic market for some 22 years prior to the filing of the opposed applications. Consequently, rather than seeing these applications as an attempt to ‘cash in’ on the reputation of the opponent’s logo marks (if any), I am satisfied the applications were filed in order to gain statutory protection for trade marks which already have a reputation in Australia.
[22] See [2006] ATMO 74
I find that the opponent has not established this ground of opposition.
Decision
The opponent has not established any of the grounds of opposition nominated on the Notice. The three applications – 1013798, 1013806 and 1013807 - may proceed to registration after one month from the date of this decision. If the Registrar has been served with a notice of appeal before that time, the registrations shall not occur until the appeal has been discontinued or, in the event of a decision from the Court, that the applications be subject to that order.
Costs
Costs usually follow the event, and there is nothing before me to suggest that the general rule should be varied in this case. Therefore I order costs against the opponent according to the official scale, with costs for the second and third of the three oppositions to be assessed as set out in the table attached to the Hearing Officer’s decision in James Hardie & Co Pty Ltd v Hume Industries (Malaysia) Berhad (2001) 53 IPR 591.
Alison Windsor
Hearing Officer
Trade Marks Hearings
20 September 2010

(1) If the Registrar or a prescribed court, having regard to the circumstances of a particular case, thinks fit, the Registrar or the court may decide that a person has used a trade mark if it is established that the person has used the trade mark with additions or alterations that do not substantially affect the identity of the trade mark.

Delegate:	Alison Windsor
Representation:	Opponent: Sam Ricketson of counsel, instructed by Middletons Lawyers Applicant: Celia Davies of Freehills Patent & Trade Mark Attorneys
Decision:	2010 ATMO 88 S52 opposition: Grounds pressed under ss 42(b), 43, 44, 58, 58A, 60 and 62A. No grounds established – applications to proceed to registration – costs awarded against opponent.

[2010] ATMO 88

20 September 2010