Doris Elvira Henschke & Christine Ann Henschke v Pacific Vision (Aust) Pty Ltd

[2002] ATMO 21

TRADE MARKS ACT 1995

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

Re:      Opposition by Doris Elvira Henschke & Christine Ann Henschke to registration of trade mark application 738576(33) - HILL OF CONTENT - filed in the name of Pacific Vision (Aust) Pty Ltd.

Background

Trade mark application number 738576 is an application to register the words hill of content in class 3 for Wines; spirits and liqueurs based on or derived from wine or wine grapes. The application was filed on 8 July 1997 ("the relevant date") by Pacific Vision (Aust) Pty Ltd of East Melbourne Victoria ("the applicant"). 738576 was duly examined and, on 30 October 1997, the Registrar advertised, in the Australian Official Journal of Trade Marks, that he accepted this trade mark for registration.

On 28 April 1998, in accordance with Part 5 of the Trade Marks Act 1995 ("the Act"), Doris Elvira Henschke and Christine Ann Henschke respectively of Keyneton South Australia and Vaucluse New South Wales ("the opponent") filed opposition to the registration of 738576.

The opponent listed nine ground of opposition in its notice of opposition. However, at the hearing it relied on four grounds of opposition as follows:

1. the Applicant's trade mark is deceptively similar to the opponent's hill of grace trade mark;

2. the use of the Applicant's trade mark would be contrary to law;

3. the Applicant's trade mark is deceptively similar to the opponent's hill of grace trade mark which, before the priority date for the registration of the hill of content mark, had acquired a reputation in Australia; and because of the reputation of the hill of grace mark, use of the hill of content mark would be likely to deceive or cause confusion;

4. because of the connotation of the hill of content mark, use of this mark in relation to particular goods would be likely to deceive or cause confusion.

The opponent served on the applicant, and filed with the Trade Marks Office, a bundle of seven statutory declarations as evidence in support of its opposition.

The applicant served on the opponent, and filed with the Trade Marks Office, statutory declarations by John Larchet and James Cherry as evidence in answer.

The opponent served on the applicant, and filed with the Trade Marks Office, statutory declarations by Gregory John Hutton, John Anthony Shortt-Smith (with four volumes of attachments) and Lawrence Lockshin as evidence in reply.

The matter came before me as a delegate of the Registrar of Trade Marks for hearing in Canberra on 8 November 2001. The opponent was represented by Mr John Shortt-Smith and Ms Jane Williams of Finlaysons Lawyers of Adelaide, who appeared by video link. The applicant was represented by Mr David Catterns QC instructed by Freehills Carter Smith Beadle Patent & Trade Mark Attorneys of Melbourne.

Evidence

The evidence comprised:

Declarant	Status	Dated	Exhibits	Known As
Evidence	in Support
Stephen Carl Henschke	Winemaker	1 March 1999	Henschke
Francis James Halliday	Winemaker & vigneron	25 February 1999	Exhibit A	Halliday
Anthony Lee Spawton	Lecturer in wine making	26 February 1999	Annexure ALS-1	Spawton
Gregory John Hutton	Analyst	26 February 1999	Hutton 1
Philip Murphy	Wine merchant	25 February 1999	Murphy
Ian Harold Baker	Wine consultant	26 February 1999	Baker
Anthony Ludwik Jucha	Solicitor	1 March 1999	Exhibits ALJ-1 & ALJ2	Jucha

Declarant	Status	Dated	Exhibits	Known As
Evidence	in Answer
John Larchet	Chief Executive Officer	27 January 2001	Annexures A & B	Larchet
James Cherry	Attorney	14 February 2001	Annexure A	Cherry
Evidence	in Reply
Gregory John Hutton	Analyst	16 July 2001	Hutton 2
John Anthony Shortt-Smith	Solicitor	16 July 2001	Attachments JSS1 to JSS4	Shortt-Smith
Lawrence S. Lockshin	Associate Professor of Wine Marketing	25 July 2001	Exhibit LSL-1	Lockshin

The Henschke declaration provides a background to the hill of grace wine and eponymous vineyard. The wine is sourced from a single vineyard and has been produced in its current style since 1958. Mr Henschke states that the wine is of unique quality and has achieved an "icon status".

The Halliday declaration is made by a well-known winemaker and journalist, who attests to the iconic status of the hill of grace wine. He offers the opinion that some sections of the wine market are likely to confuse hill of content with hill of grace.

The Spawton declaration is made by a lecturer in wine marketing at the School of Marketing, University of South Australia. He provides evidence of his experience and expertise in the areas of wine marketing and product management. He also attests to the iconic status of hill of grace and offers the opinion that hill of content will lead to deception and confusion in the wine market.

Hutton 1 provides the results of a survey of 93 people, being customers of two wine shops. They were asked the following questions relating to hill of content:

(a)What do you think of hill of content wine? Do you know anything about the wine's quality?

(b)Where do you think it comes from and who would make it?

In response to question (a), 81 respondents said they had never heard of the wine, 9 said they had never tried the wine, and 3 said they had heard of it (two of whom said they had tasted it).  In response to question (b), 71 respondents could not offer a suggestion as to origin or maker of the wine, 8 thought it came from a South Australian region, 4 said "I've heard of Hill of Grace", while 10 wondered if it was connected to hill of grace.

The Murphy declaration is made by a wine merchant and restaurateur. Mr Murphy says that his store sells premium wines, amounting to 30% of his turnover. He says his restaurant is one of Melbourne's best and has one of the most extensive wine lists in Australia. In Mr Murphy's opinion, hill of grace is one of Australia's finest wines. He believed there was a real prospect that the use of hill of content would cause confusion and that some customers would be confused and think that hill of content had an association with hill of grace.

The Baker declaration is made by a wine marketer with Lindemans Wines, who explains the advantages of old vines and single sources of grapes to the production of quality wines. Like the other declarants for the opponent, he attests to the iconic status of the hill of grace wine. He offers the opinion that some sections of the wine market are likely to confuse hill of content with hill of grace.

The Jucha declaration was made by a solicitor employed by the firm acting for the opponent. His declaration exhibits the book 40 Years of Hill of Grace and a bundle of 12 reviews of hill of grace wine. The reviews each refer to the entire range of vintages of the wine and to its reputation.

Evidence in answer included the Larchet declaration, by the chief executive of the applicant. His declaration includes a background to the choice of the hill of content name: an intention to suggest a "place in the mind", rather than a specific geographic location. The declaration also states that the applicant exports wine bearing the hill of content mark to the United States of America, but none is supplied to Australian retailers.

The Cherry declaration is made by a partner in the firm of attorneys acting for the applicant. Annexed to the declaration is a statutory declaration by Michael Hope, winemaker and opponent to the registration of the trade mark hill of hope in the name of CA Henschke & Co. Mr Hope details the background to his naming his winery and its wines hill of hope and provides evidence of the use of the name in the wine industry.

In evidence in reply, the Hutton 2 declaration clarifies the details of the survey conducted and reported upon in Hutton 1. The Shortt-Smith declaration rebuts any inference in the annexure to the Cherry declaration that there might be a hill of hope trade mark not owned by the Henschke family.

The Lockshin declaration is by the director of the Wine Marketing Research Group of the University of South Australia. It is a report of a survey conducted by him in July 2001. The survey questioned customers in four different Adelaide wine shops. Respondents were classified as either "involved" or "uninvolved" consumers. Involved consumers were interested in and knowledgable about wine, and used "intrinsic cues" (such as wine quality or grape variety) to select wine for purchase or consumption. Uninvolved consumers, the majority of consumers, were less knowledgable and used mainly "extrinsic cues" to select wines. Such cues included price, brand name, appearance of bottle or label, and shelf position.

Ninety six respondents were first asked to recall, unaided, any prestige wine brands. Five (5.2%) mentioned hill of grace and none mentioned hill of content. They were then shown a list of 25 wines and asked which they recognised. Sixty five (67.7%) recalled hill of grace and 17 (17.7%) purported to recall hill of content.

The respondents were categorised as either "high involvement" or "low involvement" consumers, with 36 being in the former category and 60 in the latter. Thirty (83.3%) high involvement consumers recognised hill of grace and 10 (27.7%) recognised hill of content. Thirty five (58.3%) low involvement consumers recognised hill of grace and seven (11.6%) recognised hill of content.

There was also a list of eight prestige wines (including hill of grace and hill of content) presented to respondents. Respondents were asked to rank the wines and estimate a retail price for each. 77.7% of high involvement consumers ranked hill of grace first or second, 50.9% of low involvement consumers ranked it first or second. 38% of all respondents ranked hill of grace and hill of content within one ranking number of each other.

The Lockshin declaration's survey concluded that hill of grace was well known to both involved and uninvolved consumers. He opined that the level of perceived recognition of the hill of content brand (not sold in Australia) was likely to be attributable to its similarity with hill of grace.

Submissions, Considerations and Findings

Both Mr Shortt-Smith, for the opponent, and Mr Catterns QC, for the applicant, made comprehensive submissions in relation to the grounds of opposition argued. I will not repeat them in detail here. However, I will refer briefly to any points that they made where I consider it would be relevant in explaining my decision.

Ground 1: Section 44 - Deceptive Similarity

Section 44, in so far as it is relevant, reads:

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.

The opponent's trade mark has a priority date of 27 November 1970, which is earlier than the applicant's trade mark.

The matters for determination are therefore:

(a)whether the applicant's mark is deceptively similar to the opponent's registered trade mark in that it so nearly resembles that mark that it is likely to deceive or cause confusion (Section 10); and

(b)whether the opponent's trade mark are registered in respect of similar goods.

The opponent's 244411 hill of grace registration in class 33 is for wines. There can be no doubt that these are similar goods to those of the applicant.

There was no disagreement between the parties as to the appropriate tests to be applied in determining whether or not the applicant's mark is deceptively similar to that of the opponent. This can be summarised as whether an "uninvolved consumer" who has an imperfect recollection would be caused to wonder whether the two wines might come from the same source.

The Full Court of the Federal Court in CA Henschke & Co and Ors v Rosemount Estates Pty Ltd (2000) 52 IPR 42, in considering whether hill of gold was deceptively similar to hill of grace made the following observations at 68:

The imperfect recollection of the uninvolved consumer would not, we think, be of a brand of that general kind. That being so, we are less confident of the outcome of the comparison that must be made than his Honour was of the result of the comparison which he was invited to make. Both the metaphorical character of the names and the common "Hill of" are, we think, important matters to be taken into account in assessing the effect of the "Hill of Gold" mark on an uninvolved consumer who has an imperfect recollection of "Hill of Grace". They are two points of similarity and, we think, in a crowded market, reasonably striking ones. But we do not think that any metaphorical "Hill of ..." mark would necessarily be an infringement. For example, we greatly doubt that "Hill of Frankincense" would be: both might be seen to have a vaguely biblical or religious connotation, but aurally, and as they strike the eye, the two are substantially different. "Hill of Enmity", Hill of Malevolence" or "Hill of Greed" are even less likely candidates for infringement. Similarly, though both names are metaphorical, we agree with the learned judge in thinking that it is the word "Grace" which gives the appellant's mark its peculiar and distinctive character; the use of the word "Gold" turns the "Hill of .." phrase into one of a significantly different character. "Grace" and "Gold" sound different and evoke, we think, quite distinct impressions. Precise analysis may not help much in matters of this kind; but "Gold", in our view, has a much more earth-bound, even mercenary, signification than "Grace". The amazement which may be evoked by grace is of a character quite different from any usual responses to gold. Though we accept that it is a matter on which opinions could well differ, our view is that, applying the test established by the Australian authorities, "Hill of Gold" does not so nearly resemble "Hill of Grace" that it is likely to deceive or cause confusion: that is, to cause the uninvolved consumer to wonder whether the two wines may come from the same source.

Both parties referred to the above passage, or parts of it, with approval to support there cases. Not surprisingly, the parties drew different conclusions as to its authority.

Mr Shortt-Smith, for the opponent, highlighted the different significations of "gold" and "grace". He highlighted the similar positive connotations of pleasure and satisfaction of "grace" and "content". While accepting that any metaphorical "hill of" mark will not necessarily be deceptively similar, it was submitted that a "hill of 'positive abstractions'" might. Mr Shortt-Smith also highlighted the similarities in definition and connotation, and the unusual syntax of the hill of ... marks.

Mr Catterns QC, for the applicant, focussed on the differences between the words. They had different initial letters and different numbers of syllables. The ideas of the words were quite different. The religious connotation of grace was totally absent from "content".

The Full Federal Court in CA Henschke & Co and Ors v Rosemount Estates Pty Ltd, supra, dismisses the idea that any hill of ... mark will necessarily constitute deceptive similarity. It also rejected a metaphorical hill of ... mark sharing vague similarities in connotation but being aurally and visually substantially different.

The words grace and content are substantially different, both aurally and visually. I note that content has two types of meanings and two pronunciations. Content can be defined as that which is contained in anything. This definition is provided in the extracts from the Oxford English Dictionary annexed to the Larchet declaration. While this definition was not argued at the hearing, it is a definition that could be thought of by a consumer of wines. Wine labels often refer to the volume of wine in the bottle as its contents.

I am not satisfied that the metaphorical "positive abstractions" are of the same character or impression. Grace has very positive characteristics - such as elegance, beauty, favour, etc, as well as a vaguely biblical or religious connotation - while content (when not defined as that which is contained in anything) seems more passive and neutral, not as positive in character, and has no religious connotation.

In applying the tests as detailed in CA Henschke & Co and Ors v Rosemount Estates Pty Ltd, supra, I am not satisfied that hill of content so nearly resembles hill of grace that it is likely to cause an uninvolved consumer to wonder whether the two wines come from the same source.

I find that the opponent has not established this ground of opposition. I therefore dismiss this ground.

Ground 2: Section s42(b) - Contrary to Law

Section 42 of the Act reads:

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

(a) the trade mark contains or consists of scandalous matter; or

(b) its use would be contrary to law.

The decision of Madgwick J in Advantage-Rent-a-Car Inc v Advantage car Rental Pty Ltd [2001] FCA 683 ("the Advantage case") is authority for the Registrar of Trade Marks, and delegates of the Registrar, making a decision in respect of a ground in opposition proceedings that the use of the mark the subject of the application "would be contrary to law" within the meaning of paragraph 42(b) in that such use would constitute an infringement of a provision in legislation.

The opponent submits that the use of the application mark in Australia would be likely to mislead or deceive in contravention of section 52 of the Trade Practices Act 1974 and would also impliedly represent that the goods are of a standard or quality or have sponsorship or approval they do not have in contravention of section 53 of that Act.

The opponent submits that the evidence tendered in support of the opposition and in reply demonstrates the substantial reputation of the hill of grace wine in Australia and that that evidence also demonstrates that a significant proportion of consumers would falsely associate the conflicting marks and thus infringe the Trade Practices Act.

I am satisfied that the evidence demonstrates that hill of grace is one of Australia's best red wines and that it enjoys a substantial reputation in the Australian wine industry. However, I am not satisfied that the reputation extends to any significant extent beyond the "involved" sector of the market and into the larger "uninvolved" sector.

Much of this evidence was given careful analysis by the judge at first instance, Finn J in CA Henschke & Co and Ors v Rosemount Estates Pty Ltd (1999) 47 IPR 63, and approved by the Full Court in CA Henschke & Co and Ors v Rosemount Estates Pty Ltd (2000) 52 IPR 42. Following the reasoning in the case at first instance, I feel that the evidence, other than the surveys by Hutton and Lockshin, has little weight in respect of determining the issue of deception, misleading and confusion. I also adopt Finn J's conclusion that the Hutton survey "is at best equivocal" (at 95).

I accept the expertise of Professor Lockshin and accept his definitions of involved and uninvolved consumers. However, I am concerned that the methodology used with respect to "aided recall" tends to over-inflate the purported recognition of the hill of content brand. I am not convinced that it demonstrates that the relevant section of the public would be likely to be deceived, or mislead, or confused by the marks.

Even if I accept the Lockshin statistics at face value, I can only conclude that this could amount to an infringement of the Trade Practices Act. I am unable to conclude that use of the hill of content mark would be contrary to the Trade Practices Act.

I find that the opponent has not established this ground of opposition. I therefore dismiss this ground.

Ground 3: Section 60 Ground - Reputation

Section 60 of the Act provides:

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.

Accordingly, to satisfy section 60, the opponent has the burden of establishing the following elements:

(a)       a pre-existing trade mark;

(b)substantial identity or deceptive similarity between the applied for trade mark and the pre-existing trade mark;

(c)the acquisition of a reputation in Australia by the pre-existing trade mark; and

(d)a likelihood that, because of that reputation, use of the applied for trade mark would be likely to deceive or cause confusion.

I have already determined the issue of deceptive similarity under the section 44 ground. Having already found that the competing marks are not deceptively similar, it is not necessary to consider the other elements.

I find that the opponent has not established this ground of opposition. I therefore dismiss this ground.

Ground 4: Section 43 - Connotation

Section 43 reads:

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.

Section 43, when used in opposition to registration, requires an opponent to show that:

(a)there is a connotation in the proposed mark, or one of its parts; and

(b)because of this, the trade mark is likely, when in use, to deceive or cause confusion.

TGI Friday's Australia Pty Ltd v TGI Friday's Inc (2000) 48 IPR 513 confirms that the connotation must be in the applicant's trade mark itself. The connotation cannot be determined as a result of external considerations, such as reputation or use.

The test for deception or confusion is dealt with in the judgement of French J in Registrar of Trade Marks v Woolworths, (1999) AIPC 91-499 at 39,695 (paragraph 43) (the Metro case). In considering the phrase "likely to deceive or cause confusion", his Honour says:

The use of the word “likely” in this context does not import a requirement that it be more probable than not that the mark has that effect.  The probability of deception or confusion must be finite and non-trivial. There must be a “real tangible danger of its occurring”.

Mr Shortt-Smith stated that the opponent had not abandoned this ground, but would really only press it if unsuccessful on other grounds.

The opponent contends that the connotation of each mark is very similar to the extent that hill of content is likely to connote that it is part of Henschke's Hill of Positive Abstractions series of wines. The similarities of the key words, grace and content both:

• are abstract nouns, sometimes adjectives;

• convey states or qualities that are positive;

• normally imply acceptance, particularly of limitations, or restraint;

• suggest restrained satisfaction;

• suggest the absence of desire;

• but are highly desirable;

• suggest peacefulness, harmony, absence of violence, balance.

With respect, such a comparison of connotations of opposing marks requires an evaluation of external factors including the reputation of the opponent's mark. In my opinion, notwithstanding the metaphorical rather than topographical signification of the application mark, the mark does not possess a connotation that is likely to deceive or cause confusion.

I find that the opponent has not established this ground of opposition. I therefore dismiss this ground.

Decision

The opponent has not established any of its grounds of opposition. I therefore direct that the applicant's trade mark be registered unless, within one month from the date of this decision, the Registrar is served with a copy of a notice of appeal.

Costs

As to costs, I see no reason why costs should not follow the event. I direct that the opponent pay the costs of the applicant in accordance with the Official Scale (Schedule 8 of the Trade Marks Regulations 1995)

Jock McDonagh
Hearing Officer

28 February 2002