E.A. and K.R. Patterson v WRQ, Inc

[2000] ATMO 16

TRADE MARKS ACT 1995

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

Re:Opposition by WRQ, INC to registration of trade mark application 670657(42) - DIGITAL REFLECTIONS- filed in the name of E. A. AND K. R. PATTERSON.

Background

Elizabeth Anne Patterson and Keith Robert Patterson (the applicants) have applied to register the following trade mark:

in respect of the service of "Design, development and hosting of sites on the Internet" in class 42.  The Trade Marks Office has accepted that application for registration.

Registration of that trade mark has been opposed by WRQ, Inc, (WRQ) an American company that provides connecting software for, among other things, allowing various computer applications to be accessed via the Internet.  WRQ's trade mark is the word REFLECTION, for which it holds a registration in class 9 and a significantly later one in class 41.

In the course of the conduct of the opposition, the applicants have already stated their case by way of a letter to the registrar.  In essence, their case is built on the premise that there is a clear distinction between what WRQ does and what the applicants do.  They have copied that material to WRQ's attorneys.  It does not have the force of evidence but I will consider their comments as arguments.  It will be most efficient if, in due course below, I simply set out the relevant issues.

After the evidence stages set out in the regulations, the opposition came on for hearing before me, as a delegate of the Registrar of Trade Marks.  At that hearing, the applicants made no submissions either in person or in writing.  WRQ was represented by its patent attorney, Martin Pollock, of Spruson and Ferguson, patent attorneys.

Grounds of opposition

WRQ relies on three grounds of opposition.  I will now list and deal with them in turn:

Deceptively similar to an earlier trade mark (s 44) 

S 44(2) reads:

Identical etc. trade marks

(2) Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant's trade mark) in respect of services (applicant's services) must be rejected if:

(a) It is substantially identical with, or deceptively similar to:

(i) A trade mark registered by another person in respect of similar services or closely related goods; or
(ii) a trade mark whose registration in respect of similar services or closely related goods 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 services is not earlier than the priority date for the registration of the other trade mark in respect of the similar services or closely related goods.

Note 1: For deceptively similar see section 10:  a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.

Note 3: For priority date see section 12.  For current purposes, the applicants' trade mark has a later priority date than the class 9 registration held by WRQ.

Given these things, WRQ relies only on its class 9 registration.  This, as the applicants have pointed out, is for "computer programs including computer programs and instruction manuals sold as a unit".  WRQ does not argue that its trade mark, REFLECTION, is substantially identical to the applicants' mark.  Its case hinges, firstly, on the marks being deceptively similar.  If that is so, then an additional question must be answered before the terms of s 44(2) are established: are the respective goods and services "closely related"?

Mr Pollock relied on the issue as formulated in Australian Woollen Mills Ltd v F.S. Walton & Co Ltd (1937) 58 CLR 641:

In deciding this question, the marks ought not, of course, to be compared side by side.  An attempt should be made to estimate the effect or impression produced on the mind of potential customers by the mark or device for which the protection of an injunction is sought.  The impression or recollection which is carried away and retained is necessarily the basis of any mistaken belief that the challenged mark or device is the same.  The effect of spoken description must be considered.  If a mark is in fact or from its nature likely to be the source of some name or verbal description by which buyers will express their desire to have the goods, their similarities both of sound and of meaning may play an important part.  The usual manner in which ordinary people behave must be the test of what confusion or deception may be expected.  Potential buyers of goods are not to be credited with any high perception or habitual caution.  On the other hand, exceptional carelessness or stupidity may be disregarded.  The course of business and the way in which the particular class of goods are sold gives, it may be said, the setting, and the habits and observation of men considered in the mass affords the standard.  Evidence of actual cases of deception, if forthcoming, is of great weight."

Mr Pollock also argued that the word REFLECTION must necessarily be too close to the applied-for mark because it is a part of the applicants' mark.  He based this argument on the decision of King J in Seven Up Co v Bubble Up Co Inc (1987) AIPC 90-433. However, that line of reasoning has been questioned. See, for example, p 170-171 of Shanahan's Australian Law of Trade Marks and Passing Off.  Similarly, delegates of the Registrar of Trade Marks have for some time been cautious in taking the reasoning of King J as a substitute for the proper application of the law on comparison of marks, for instance see Tecmo Kabushiki Kaisha v Tokyo Denki Kabushiki Kaisha (1995) AIPC 91-177.

Accordingly, I will proceed to decide this matter on a full application of the principles set out in Australian Woollen Mills, supra.

In making such an assessment, I note that, in the course of their written comments, the applicants sought to minimise the importance of the word REFLECTIONS in their mark, and stressed the significance of the logo element.  However, Mr Pollock noted that there are instances, in the material on the file, where the applicants speak of themselves as "Digital Reflections".  I believe that this is the way the applicants' mark will be recalled and I take the device element as having very little weight in any comparison of the applicants's trade mark with one that consists of a word alone.

Mr Pollock also noted that the word DIGITAL has a technical significance for goods and services that are to do with the field of computing, among many others.  He noted that in Digital Equipment Corporation v Australian Telecommunication Commission 28 IPR 663, Hearing Officer Zars noted this, as follows.

"Digital" has acquired significant currency in expressions such as digital watches, digital recordings, digital data, digital equipment, digital technology … I think that many people dealing with computers are likely to understand the overall technical meaning of the word.

Thus, argued Mr Pollock, "the word DIGITAL within the applicants' mark is non-distinctive, and the essential feature of the mark as a whole is the word REFLECTIONS".  That, in my opinion, is not correct. 

There is much case law to the effect that the essential particular of a trade mark is its heart or essence.  It may be that the essential particular of a mark is improperly used if it appears in another mark in combination with other elements.  However, I think it is invalid to take a mark like DIGITAL REFLECTIONS and argue that the element DIGITAL is verging on negligible simply because, in isolation, it is common to the trade.  True, the commonness of the word DIGITAL, as Mr Pollock went on to argue, will lessen the impact of that element in any comparison of that mark with another.  However, that is as far as it goes.  It would be wrong for me to compare the mark DIGITAL REFLECTIONS with REFLECTION on any other basis.  I will explain.

Mr Pollock compared the present case to that in Microcom v Microcom Systems 41 IPR 163. There, the competing marks were MICROCOM and MICROCOM NETWORKING PROTOCOL. The term "networking protocol" is generic and, not surprisingly, the hearing officer found the two marks deceptively similar. The situation there is far removed from the current case.

Similarly, in comparing the trade marks YELLOW PAGES and YELLOWNET, the hearing officer concluded that YELLOW was an essential particular of both.  See Telstra Corporation Ltd v Yellownet Corporation 44 IPR 415. In that case, very much reduced weight was given to the latter elements in the two marks.

In the present instance, "reflections" is an ordinary English word.  It can mean any of the obvious physical reflections, for instance an image in a mirror, or when sound, light or other energy is reflected with lesser accuracy from other objects.  Or it can mean the even less tangible mental processes of meditations or recollections.  On the other hand, digital technology is, very roughly, an encoding of information.  Given this, the words "digital reflections" are, to a fair degree, a contradiction.  They have, therefore, no particularly clear meaning. 

The words are, in fact, an allusion to the applicants' services in the designing of Internet sites.  A website, designed by the applicants for a paying customer, could well be said to be a reflection of the (purported, at any rate) values and attributes of the client.  Presented digitally, through the Internet, it could be said that these sites are "digital reflections", but not with that degree of familiarity of use that would reduce the weight given to the first of those two words.

In deciding if a ground of opposition is established by WRQ, I must take note of the framework of the 1995 act.  The ground relied upon by WRQ is one allowed by s 57 of the act.  It is said that a ground of rejection exists in terms of section 44, which is part of Division 2 of Part 4.  Section 33 sets a framework for the factual question posed by s 44.  It is emphatic:

The Registrar must, after the examination, accept the application unless he or she is satisfied that:
(a) the application has not been made in accordance with this Act; or
(b) there are grounds for rejecting it.

For the ground to be established, as WRQ is required to do under s 55, I must conclude positively that the marks in question are deceptively similar.  It is not enough, under the 1995 act, to say that the matter is nicely balanced, or that I am not satisfied that sufficient doubt has been eliminated.

I note the PIANOTIST case, Pianotist Co's Appn (1906) 23 RPC 774, at 777, which catalogues the relevant factors to be considered in comparing marks:

You must take the two words.  You must judge of them, both by their look and by their sound.  You must consider the goods to which they are to be applied.  You must consider the nature and kind of customer who would be likely to buy those goods.  In fact, you must consider all the surrounding circumstances; and you must further consider what is likely to happen if each of those trade marks is used in a normal way as a trade mark for the goods of the respective owners of the marks."

I allow, therefore, for the nature of the service provided by the applicant.  I also allow for the fact that, at the filing date of the opposed application, some of the software within a range such as the one specified by WRQ would have been aimed at Internet applications.  I also concede that the applicant's goods are "closely related" to software for use in conjunction with the Internet. 

It is not to the point that there is only a small amount of evidence that WRQ had, at the relevant date, actually used its trade mark on any goods to be used in conjunction with the Internet.  Its registration must be taken at face value.  Likewise, I give no weight to Mr Pollock's argument that the applicants, under the scope of the services now specified, may wish to conduct a trade in designing software to assist with developing and hosting Internet sites.  That is simply not the service that the applicants have specified.  The proper test must focus on what will happen if the applicants gain a registration and use it in a normal and fair manner, just as it assumes that WRQ was entitled to make full use of its registration.

Adding these things together, and allowing for similarities and differences in the component elements of the marks, I find that the marks in question are not deceptively similar.  Accordingly, I find that WRQ has not established a ground of opposition under s 44.

Deceptively similar to a trade mark which has a prior reputation (s 60)

Section 60 of the Trade Marks Act provides that:

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.

WRQ is apparently a major player in its field.  The evidence establishes that its REFLECTION product is well known.  Also, apparently before the filing date of the opposed application, WRQ had a small extension of its reputation into Internet-related areas.  It is not entirely clear that this aspect was significant in Australia at that time.  However, I note that the sort of software produced by WRQ is sophisticated; it is aimed not at end users but at computer system administrators, those most likely to keep abreast of overseas developments in a specialised and fast-changing field.  Either way, at the relevant time, WRQ's main business was in software allowing computer applications operated by WRQ's customers to interface with those customers' pre-existing ("legacy") systems.  For such software, its reputation was clearly quite significant.

I concede the force of Mr Pollock's argument that Internet connectivity was always a logical extension of WRQ's business.  However, this was, at the relevant date, more a factor relevant to the likelihood of a wrong inference being made.  It was not necessarily a characteristic of the actual extent, at that time, of the reputation.

Ultimately, though, the bottom line of s 60 is that, unless the marks in question are deceptively similar, s 60 cannot impede the registration of the applicants' mark. I have already concluded that the marks are not deceptively similar and therefore I find that this ground of opposition has not been established.

Marks likely to deceive or cause confusion (s 43)

Lest this matter go on appeal, I will deal briefly with the provisions of that section, which reads:

43. 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.

There is a line of Trade Mark Office decisions where it is argued that mere trade mark reputation cannot give rise to a connotation. Conversely, there have been court decisions where, in the absence of full argument on that point, the decision has been to the contrary. I am not called on to enter into that debate. Mr Pollock accepted that, in many instances, the opponent will be able to make a case under s 60.

My own view about how s 43 operates is already on record in relation to the opposition by Unilever PLC to the registration of trade mark application number 664808 in the name of Cadbury Limited (publication pending).  Perhaps I am wrong in what I said in that case.  If so, and a reputation as a trade mark can engender a connotation - a direct or implicit meaning - in a word, then I still do not accept that a ground of opposition has been established under s 43 in the present case.  No matter how s 43 may ultimately be found to operate, there is not so big a reputation in WRQ's trade mark that it can swamp the distinguishing differences in the two competing marks.  I do not accept that, given the difference between the marks, there is a significant risk of deception or confusion.

Conclusion

The opposition has failed on all grounds.  In terms of s 55 my decision is to register the application.  I therefore direct that the application proceed to registration, subject to any appeal on that question.  In so doing and that WRQ pay the costs of the applicants up to the amount set out in the relevant items of the scale of costs.  In the event of any dispute as to this amount, and on payment of the necessary fee, the applicants' costs will be taxed, allowed and certified by an officer of the Trade Marks Office.

T. E. Williams
Hearing Officer
29 February 2000