Donald Richard Algie v Jerry a. Dorminy

[1994] ATMO 51

TRADE MARKS ACT 1955

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

Re:      S49 opposition by Jerry A. Dorminy to the registration of trade mark applications numbers A517451(25), A517452(42), A539203(29),  and A539204(42), these marks containing or being the words HOG'S BREATH; and A582493(42),  HOG'S HEAD;  in the name of Donald Richard Algie.

This matter concerns the following five trade marks filed in the name of Donald Richard Algie.

the goods or services claimed
A517451(25)	Clothing
A517452(42)	Restaurant services
A539203(29) HOG'S BREATH	Meat, fish, poultry and game; meat extracts; preserved, dried and cooked fruits and vegetables; jellies, jams; eggs,  milk and milk products; edible oils and fats; salad  dressings; preserves; and all other goods included in this class
A539204(42) HOG'S BREATH	Restaurant services, services provided by establishments serving alcoholic and non-alcoholic beverages; take away food services; retail and wholesale services including retail and wholesale services relating to items of clothing, including T-shirts, souvenirs, items of food and beverages; providing camp ground facilities and facilities for exhibitions including such facilities relating to sporting events including yacht races; meteorological information, weather forecasting, and the preparation of reports including such services relating to sporting events and in particular yacht races; providing housing accommodation; tourist homes, including providing accommodation for participants in sporting events and in particular yacht races; hotel management and reservation services
A582493(42) HOG'S HEAD	Restaurant services, services provided by establishments serving alcoholic and non-alcoholic beverages; take away food services; retail and wholesale services relating to items of clothing, including T-shirts, souvenirs, items of food and beverages; providing camp ground facilities and facilities for exhibitions including such facilities relating to sporting events including yacht races; meteorological information, weather forecasting, and the preparation of reports including such services relating to sporting events and, in particular, yacht races; providing housing, accommodation; tourist homes, including providing accommodation for participants in sporting events and particular yacht races; hotel management and reservation services

All these trade marks are now accepted and opposition to each mark has been filed by Jerry A. Dorminy of Fort Walton Beach, Florida in the United States of America.

I conducted the hearing in Canberra on 27 May 1994.  Mr Dorminy was represented by Mr T. J. Golding of Counsel of Brisbane.  Mr Algie was represented by Mr A. Terry of Bowdens  Lawyers of Brisbane.   

The service of evidence, prescribed under regulations 45, 46 and 47,  was fully completed only in relation to A517451(25) and A517452(42).  However, both parties rely on that evidence in relation to all five marks.  Mr Golding and Mr Terry agreed that all five marks should be heard together and the evidence served in relation to A517451(25) and A517452(42), should be taken into account for all five marks.  Section 50 entitles me to take account of any grounds, and accordingly I will consider the grounds raised in the evidence served,  in relation to all five marks.

In commencing,  Mr Golding submitted that the trade mark HOG'S HEAD  filed under application number A582493(42) was essentially the same as the HOG'S BREATH mark filed under A517452(42).  He claimed the HOG'S HEAD mark was nothing more than a naming of the device in the A517452(42).  He proposed that any use ascribed to A517452(42) was equivalent to use of the HOG'S HEAD mark and should be treated as such.  Mr Terry rejected this proposition.  He said that the HOG'S HEAD mark was very different from A517452(42) and that I should only be satisfied in relation to use of that mark if use of the HOG'S HEAD mark was indeed available.  I agree with him. While a dominating feature of A517452(42) is undoubtedly a pig's head, and the words contained in that mark proclaim that animal to be a "hog",  there are nevertheless substantial differences both in content and idea, between this mark and the words  HOG'S HEAD.  These differences constitute significant and distinctive detail and I am not prepared to consider use of one mark as equivalent to use of the other.  As none of the evidence or submissions indicate any grounds on which the opposition could separately succeed in relation to HOG'S HEAD, I  at once dismiss the opposition so far as it relates to trade mark number A582493(42).

Mr Golding then turned to the grounds of the opposition and conceded that the proprietorship claim based on prior use is only supported in respect of the class 25 application  - A517451(25). There is also, he said, in relation to this mark,  a faint argument under section 28(a).  In relation to the other marks, and also primarily in relation to A517451(25),  the opponent's attack is based on the claim that Mr Algie is not entitled to secure registration because a previous relationship between him and Mr Dorminy gives rise to obligations in Mr Algie to act in the interest of Mr Dorminy. 

The evidence

The evidence in support of the opposition is a declaration by the opponent, Mr Jerry A. Dorminy, dated 4 April 1991.  I refer to this declaration as Dorminy 1991 . There are nine exhibits denominated JAD.I to JAD.IX.  The evidence in answer, is a declaration by Mr Algie and it is dated 22 April 1992.  I refer to it as Algie  1992.  There are 13 exhibits denominated "A" to "M".  There is also evidence in reply and it is a second declaration by Mr Dorminy .  It is dated 11 February 1993.  I refer to it as Dorminy 1993. The 13 exhibits attached to this declaration are denominated JAD.A to JAD.M

The grounds of the opposition

I shall deal in turn with the grounds on which the case has been argued.    First in relation to the earliest HOG'S BREATH mark, A517451(25),  there is a claim per sub-section 40(1), of prior use, and per paragraph 28(a) a slender claim of confusion and deception.  Second, in relation to the four HOG'S BREATH marks, A517451(25) A517452(42) A539203(29) and A539204(42), there is a claim that because of business arrangements between the parties, the applicant is not entitled to register any of the marks.  

Section 40(1) and A517451(25) - the application in class 25

Mr Golding submitted that Exhibits JAD.II and JAD.III of Dorminy 1991, demonstrate that Mr Dorminy used the HOG'S BREATH trade mark in Australia and  in relation to clothing, earlier than the date on which A517451(25) was filed, and earlier than the date on which Mr Algie first applied the mark to any goods.  If the evidence establishes these facts, then, as Mr Golding says,  in accordance with the directives of  The Seven Up Company -v- O. T. Limited and another,  75 CLR 203, the application will fail. He referred me to Justice Williams' comments at p211

[I]n the absence of fraud it is not unlawful for a trader to become the registered proprietor under the Trade Marks Act of a mark which has been used however extensively, by another trader as a mark for similar goods in a foreign country, provided the foreign mark has not been used at all in Australia at the date of the application for registration.  But the position is different if at that date the mark has become identified with the goods of the foreign trader in Australia because those goods have been brought into Australia by the foreign trader himself or by some importer or in some other manner.  The court frowns upon any attempt by one trader to appropriate the mark of another trader although the trader is a foreign trader and the mark has only been used by him in a foreign country.   It therefore seizes upon a very small amount of use of the foreign mark in Australia to hold that it has become identified with and distinctive of the goods of the foreign trader in Australia.  It is not then a mark which another trader is entitled to apply to register under the Trade Marks Act because it is not his property but the property of the foreign trader.  The registrar is entitled to refuse to register the mark for such goods.  If it has been registered the court may rectify the register on the ground that the mark is wrongly entered on the register.

Mr Golding submitted that the evidence of  Exhibits JAD.II and JAD.III establishes that Mr Dorminy sold clothing in Australia bearing the trade mark the subject of A517451(25),  prior to Mr Algie's application.  Mr Golding  acknowledged that this use of the mark is limited, but he said it establishes the foothold necessary to prevent another trader from appropriating Mr Dorminy's mark.

The evidence is certainly of a limited sale.  Exhibit JAD.II shows that in October 1986, Mr Trevor Bower, of 15 Light Street, Casino, New South Wales, ordered a size 42", royal blue, sweat shirt, and charged it to his Visa card.  He offered to exchange an Australian shirt for a United States shirt should anyone be interested.  Mr Bower's order comes partly through a hand written and undated note but it includes a completed Hog's Breath Mail Order.  The goods were dispatched on an invoice dated 9 October 1986.  A second invoice in this Exhibit shows that complimentary articles were dispatched to Mr Algie but as Mr Terry pointed out, complimentary articles do not constitute a use in the course of trade.  Mr Golding did not dispute this. I agree with Mr Terry and shall make no further reference to the second invoice.  Turning back to Mr Bower's purchase,  Mr Dorminy does not explain how Mr Bower came to make the order.  It is not at all clear that order forms or catalogues from Mr Dorminy's business were ever made available in Australia.   Mr Terry pointed out that  the order form submitted is certainly not designed for use outside the United States of America.  Exhibit JAD.III of Dorminy 1991 presents a series of illustrations which do come from a catalogue. It may well have been from a catalogue of this kind that Mr Bower ordered his shirt.  However, all that Mr Dorminy  has to say about these illustrations is that:  Goods  bearing the mark "HOG'S BREATH & DEVICE" are primarily sold in Australia by mail-order.  A copy of the mail-order brochures and invoices used are attached hereto and marked JAD.III . He does not say when, or how many of these catalogues were distributed here.   In fact, strictly speaking, his statement does not claim that any brochures were sent to this country. In sum,  this evidence is quite unsatisfactory.   In the absence of any real claim that catalogues or other material advertising the availability of the shirts were brought into the Australian market, I find I can not accept Mr Bower's purchase as evidence of Australian use.  As pointed out by Mr Terry, there are any number of  explanations of how Mr Bower may have come into possession of an order form.  He could have brought it back from an overseas visit, it could have been given to him,  he might have acquired the form in the United States and even placed the order from there. These are all reasonable and probable alternatives, particularly when I take account of the point made by Mr Terry that if a catalogue trade did exist, it would have been a simple and obvious matter to submit evidence of it.  As it is, all that has been put forward to show that Mr Dorminy sells goods here is a single purchase ordered by mail, and a guarded statement that primarily Australian sales are achieved through sales brochures.  Mr Terry invited me to consider that Mr Bower's sale is the only sale.  I am inclined to agree that it might well be.  In any case it is the only sale put forward and the evidence does not establish, to  my satisfaction that this purchase occurred in Australia.   If it was clear that Mr Bower had ordered his sweat shirt from a catalogue publicly available in this country, it would be another matter.  I have not been shown, however that catalogues are available in Australia nor even that Mr Bower's order was made on the bases of a catalogue reference.

Mr Terry raised a series of further arguments against Mr Dorminy's proprietorship claim, but as the sale on which the section 40(1) ground is based does not hold up as use in Australia,  the foundation of the section 40 objection fails, and there is no need for me to deal with them.  Some of these arguments, however, which touched on the section 28 ground, I will come to below.

In respect of the section 40(1) ground I find the opponent's claim fails the tests propounded in The Seven Up case (supra),  and accordingly I dismiss the opposition so far as it relies of this section of the Act.

Section 28 and A517451(25)

Under the terms of paragraph 28(a) Mr Dorminy contends that the use of the trade mark constituting application number A517451(25) would be likely to deceive or cause confusion and that registration is therefore prohibited.

Paragraph 28(a) depends on the opponent establishing sufficient goodwill to warrant the protection afforded by these provisions.  As per Justice Evershed's  famous directives in the Smith, Hayden & Co. Ltd's Application (1946) 63 RPC 97

Having regard to the reputation acquired by the name ..., is the court satisfied that the mark applied for, if used in a normal or fair manner in connection with any goods covered by the registration proposed, will not be reasonably likely to cause deception and confusion amongst a substantial number of persons?

The Australia reputation put forward by Mr Dorminy in respect of the HOG'S BREATH trade mark in relation to clothes (or, for that matter, in relation to any of the goods or services claimed under Mr Algie's trade marks) if it exists at all, is minimal.  One sale of one sweat shirt has been claimed in Australia and that sale has not been satisfactorily established.  Mr Dorminy says in Dorminy 1991 paragraph 7, "I understand that ... advertising also reached Australia," but there is no evidence of it.  The only exhibit of any Australian exposure of Mr Dorminy's mark, other than the sweat shirt sale,   derives from reference to a yacht race (Dorminy 1991: Exhibits JAD. V). This is a single report in Australia Sailing (September 1986) on the outcome of the HOG'S BREATH 1000 which, I presume is the 1986 race (the first of apparently only two such races).  There is no reference to Mr Dorminy or to his business.  As pointed out by Mr Terry,  this exposure is not use either in the course of trade, or in relation to clothing. In Dorminy 1991, paragraph 7, Mr Dorminy indicates that advertisements for T-shirts were organized for Australian Sailing, but the evidence stops short of showing that the advertisements were actually published.  Taken all together, these claims fall well short of showing any acquired goodwill in relation to clothing, or to any other goods or services, in Australia. If there is no reputation, there seems to me to be no likelihood that persons, let alone a substantial number of persons, could be deceived through Mr Algie's use of his mark.

Mr Terry further directed me to Mr Algie's evidence, per Exhibits "F" to "J".  These show that various Americans have an interest in the mark HOG'S BREATH and cast doubt on the effect of the mention of the HOG'S BREATH mark in Australian Sailing.  Exhibit "F" shows that two publications link the mark with Mr Clint Eastwood, a well known American actor.  In light of published information of this kind,  I cannot assume that an isolated mention of the mark HOG'S BREATH in the yachting event would generate a connection with Mr Dorminy rather than to Mr Eastwood. 

Whether or not I take into account the significance of other interests in the HOG'S BREATH marks, I find that the Mr Dorminy has not demonstrated that he has acquired goodwill in Australia, and I find that the opposition based on section 28 fails at the very first barrier. 

The entitlement of Donald Richard Algie to register HOG'S BREATH

Both Mr Golding  and Mr Terry provided a chronology of the history of the association between  Mr Dorminy  and Mr Algie.  It is convenient at this point to precis this chronology as briefly as I can.

From 1976 Mr Dorminy has operated a restaurant and lounge in Florida in the United States under the name HOG'S BREATH SALOON; since the late 1980s, he has used the name HOG'S BREATH CAFE in relation to the  restaurant part of his business.  (Dorminy 1993, paragraphs 1 and 2)

His association with Mr Algie began in 1985 when he approached Mr Algie via Mr Algie's marketing and managing business at Jindabyne, New South Wales, and contracted or sub-contracted him to organise and promote a yacht race in the United States for 3 consecutive years. (Algie 1992, paragraph 1: Dorminy 1993, paragraph 1, 2 and 3.)

Mr Algie travelled to America and ran the first race. (Algie 1992, paragraph 2)

In 1986 - and on Mr Algie's suggestion, the yacht race was called the  HOG'S BREATH 1000 - INTERNATIONAL CHALLENGE (Algie 1992, paragraph 2)

In mid 1986 Mr Dorminy visited Mr Algie in Jindabyne. During the visit Mr Algie expressed interest in developing a bar and restaurant business in Australia. Mr Dorminy showed no interest in extending his business to Australia, nor was he interested in visiting any prospective business sites  (Algie 1992, paragraph 7)

In 1986, on Mr Dorminy's return to Florida, Mr Algie wrote (20 August 1986)  and then phoned in an attempt to involve Mr Dorminy in an Australian development of a HOG'S BREATH restaurant.  Mr Dorminy did not reply because he says, he had by then lost confidence in Mr Algie through his mishandling of the registrations of Mr Dorminy's business name (Dorminy 1993, paragraph 3)

Contrary to Mr Dorminy's comment in Dorminy 1993, paragraph 3, the correspondence in evidence (Dorminy 1991: Exhibit JAD.IX) indicates that it was considerably later than August 1986 that the problems relating to the registration of business names developed.  Mr Dorminy asked Mr Algie to register the business name HOG'S BREATH SALOON in New South Wales, in Mr Dorminy's name.  Only in his letter of 12 July 1987 does Mr Algie say that he has instructed his solicitor to proceed.  Mr Algie says he thought this might have meant that Mr Dorminy had changed his mind and now intended to commence business operations in Australia, but he was told "no" - the business registration was sought merely to prevent others using that name(Algie 1992, paragraph 9)

Mr Algie phoned expenses for the business name registration to Mr Dorminy, and said that difficulties were emerging first, through Mr Dorminy being in the United States, and second, because a New South Wales business name HOG'S BREATH was already registered by a Mr Rod Waterhouse (Algie 1992, paragraph 10)

On 9 October 1987 (Dorminy 1991: Exhibit IX) Mr Algie wrote again.  He said

.... regarding the business names etc.  ..... Rod Waterhouse registered the name of Hog's Breath Saloon in February 1986.  ..... I consider you need to be involved in the process here and also look at the sites within this area I think could work... 

... I don't know what your thoughts are about Hog's Breath Cafe Australia but ... north Queensland is the number one tourist destination in the country and is where most American and Japanese come straight into.  What it needs is your expertise. ... Keith Glover has approached me a number of times to be involved in Hog's Breath Australia.  I have told him that everything is your doing and I am only acting on your behalf.  He is convinced that the Cafe system as you do it will work.  He also has money to invest ....

Jerry, I can't stress enough how important it is to make solid inroads now if you want to expand in this country.  If you don't there are people out there who are ready to hop on the Hog's Breath name and especially because of the publicity that Clint Eastwood and the Hog's Breath Inn have been generating.

Mr Algie did not receive an answer (Algie  1992, paragraph 11)

In November 1987, the third race was cancelled.  Mr Algie was notified that he would not be called to perform the third year of the contract.  (Algie 1992, paragraph 12)  

Also in November 1987, Mr Algie visited the United States, met Mr Dorminy  and (per Algie  1992: paragraph 12) asked "on numerous occasions" if he was interested in establishing an operation in Australia.  Mr Dorminy said he was not interested in Australia, but wished to apply his efforts to opening another location in Florida

In May 1988, Mr Algie again visited the United States, and contacted Mr Dorminy, who again said he had no interest in an Australian development and that this decision was final   (Algie 1992: paragraph 13)

Later in May 1988, Mr Algie returned to Australia, wrote to Mr Dorminy, and said that as it was clear that Mr Dorminy had no interest in establishing operations in Australia, he (Mr Algie) intended to open a  HOG'S BREATH restaurant in Queensland.  Mr Algie deposes this in Algie  1992, paragraph 14, but the letter itself is not in evidence.  Mr Dorminy denies receipt  (Dorminy 1993, paragraph 5) 

In July 1988, Mr Algie applied on his own behalf to register the business names HOG'S BREATH SALOON and HOG'S BREATH CAFE in Queensland

On 21 July 1988 (Algie  1992, Exhibit "D")  Mr Algie wrote to Mr Dorminy saying, inter alia that as he (Mr Algie) had not received any reply to his letters, he was proceeding with a licensed restaurant in Australia; that he had registered the name HOG'S BREATH CAFE in Queensland; and that he would still like to hear from Mr Dorminy should he be interested in being part of the venture.  He followed this letter up with a phone call to Mr Dorminy's office and was told (Algie 1992: paragraph 16) that Mr Dorminy had received his letter but had not replied 

Mr Dorminy says that he thought the letter of 21 July 1987 meant that the business name had been registered for him (Dorminy 1993,  paragraph 6).  He says, rather enigmatically,  that

Mr Algie's letter to me dated 21 July 1988, suggested to me that Mr Algie registered the HOG'S BREATH and/or HOG'S BREATH & DEVICE marks in my name and this belief was based on the funds that I had paid to him to do so. I did not reply to Mr Algie's letter because I wanted nothing further to do with him.

On 30 April 1989, Mr Algie wrote again (Algie  1992, Exhibit "E") with notice that his cafe at Airlie Beach was opening, and offering Mr Dorminy a final invitation.  He says " I would appreciate one last effort from you to contact me as I plan to open the place next month and would even appreciate [it] if you could come out and have a look at it.  My offer is still open to you but I am afraid that if I don't hear from you by return then I am going to take in a partner here to help defray the costs."  Mr Algie confirmed by phone to Mr Dorminy's office that the letter had been received.  He did not receive any reply (Algie 1992: paragraph 17)

Mr Algie opened business as the HOG'S BREATH CAFE at Airlie Beach in Queensland on 4 July 1989. (Algie 1992: paragraph 28)

In August 1989 he applied to register the first two HOG'S BREATH trade marks.

Summing up the evidence in broad terms, there are seven letters from Mr Algie to Mr Dorminy which are not in dispute. There is an eighth letter, reputedly  of 5 May 1988, which is referred to but is not in evidence, and Mr Dorminy denies receipt of this letter.  The tenor of the seven letters in evidence does not, I think, support the view that Mr Golding would have me adopt.  He argues that Mr Algie and Mr Dorminy had a business arrangement through which Mr Algie assumed an obligation to act for Mr Dorminy and that in seeking registration in his own right, Mr Algie failed in his duty.  This relationship was established, according to the evidence, through a verbal contract in 1985 (Algie 1992, paragraph 4). In 1987, Mr Dorminy's secretary informed Mr Algie that he was not called on to perform the third year of his contract, and it appears that from this point the arrangement began to come apart.  Further breakdown arose over the registration of Mr Dorminy's business name in New South Wales. The registration application failed and Mr Dorminy believed that he had been misled. He said that he wanted nothing more to do with Mr Algie.  However, he seems to have been singularly unsuccessful in conveying this message to Mr Algie who continued in his efforts to involve Mr Dorminy  in his Australian venture. Mr Dorminy says in Dorminy 1993 paragraph 4

Once again, in Mr Algie's letter of 9 October 1987 he requested I consider his interest (which was always understood by me to entail a license from me) in operating a HOG'S BREATH SALOON in Australia.  I did not respond because I wanted nothing at all to do with Mr Algie from that point forward.  In spite of this Mr Algie, in November 1987, visited me in Fort Walton Beach, Florida and his continued business advances were again rejected.  This reoccurred in May 1988.

Even after this, however, Mr Algie continued to persevere.  He wrote to Mr Dorminy in July 1988 - and he was advised that although the letter was received Mr Dorminy was not intending to reply;  he wrote again on  in April 1989 - and received the same advice; on both of these occasions he left a phone message for Mr Dorminy  to contact him by phone - but got no response.  Mr Algie says (paragraph 19) that by July 1989 when he opened his business in Airlie Beach,

[Mr Dorminy ] had made it clear by failing to respond to correspondence and offers that [he] had no interest in establishing a business in Australia.  In particular, [he] did not indicate at any time that he had any objection to my usage of a name containing HOG'S BREATH despite being informed of my intentions.

Mr Dorminy does assert in Dorminy 1993 paragraph 5, that he repeatedly told Mr Algie that "he would not be authorised" to operate his own HOG'S BREATH business in Australia. He is presumably claiming that this was verbal advice because there is no evidence that he ever wrote to Mr Algie. Mr Algie on the other hand, says that at no time was he told that he did not have the right to act alone.  This claim, I think, is backed up by the content of Mr Algie's letters.

On balance, I find that Mr Algie's evidence, confirmed as it is by seven uncontested letters,  is the most convincing.  If Mr Dorminy believed that Mr Algie had a continuing duty to act on his behalf, then I believe that in the face of the information that Mr Algie was putting before him, he should have made that duty clear. Apart from the unsupported assertion in Dorminy 1993 paragraph 5, that he did so, an assertion which Mr Algie denies, there is no evidence that he took any action of this kind.

I do not think that in light of Mr Dorminy's breaking  the contractual arrangements and of his subsequent lack of communication with and response to Mr Algie's letters, that he can claim that an onus continued to fall on Mr Algie to act on Mr Dorminy's behalf. 

As things stand, I do not consider that evidence shows that Mr Algie acted in bad faith or that he is attempting to obtain registration through fraud.  I am therefore not prepared to find that as a result of his association with Mr Dorminy he is disentitled to apply for the registration of the HOG'S BREATH trade marks.

Decision

The opponent has relied on objections under sections 40 and 28, and on the ground that the applicant is not entitled to register the HOG'S BREATH marks because of the previous relationship between him and the opponent.  I have found for the applicant on each of these grounds. I have also found the opposition failed in relation to the HOG'S HEAD mark.  Consequently I dismiss this opposition.

Both sides requested costs.  There is no reason why whey should not follow the cause, and I therefore award them to the applicant. 

Helen R. Hardie

Assistant Registrar

30 June 1994