Eterna S.A. Fabrique D'Horlogerie v Advance Australasia Pty Ltd

[2001] ATMO 27

TRADE MARKS ACT 1995

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

Re:Opposition by Eterna S.A. Fabrique D'Horlogerie to the registration of trade mark application number 771190 in the name of Advance Australasia Pty Ltd for the trade mark comprising the word Eternity in Class 14.

Background

Application number 771190 was filed on 25 August 1998 in the name of Advance Australasia Pty Ltd (the applicant).  The application was for the registration of the trade mark shown below and covered the statement of goods "Horological and chronometric devices" in Class 14.

Following examination, the trade mark was advertised as accepted in the Australian Official Journal of Trade Marks of 17 December 1998.  On 16 June 1999, subsequent to the grant of an extension of time within which to do so, Eterna S.A. Fabrique D'Horlogerie (the opponent) filed notice of opposition to the trade mark’s registration.  The respective parties served evidence in support, answer and reply in the matter, and then the opponent requested a hearing to determine the opposition.  It came before me, as a delegate of the Registrar, in Canberra on 17 January 2001.  Representing the opponent at the hearing was Ms Margaret Ryan of Phillips Ormonde & Fitzpatrick.  Appearing for the applicant was Mr David Logan of Counsel, instructed by O'Shea Corser & Wadley.

The notice of opposition listed a wide range of grounds but at the hearing, the opponent's attorney advised that she would only be relying, in her submissions, upon those grounds under ss.44, 58 and 60.

The Evidence
The evidence in support comprises a declaration and exhibits by Herbert Arni, (first Arni declaration) the Director of the opponent.  Mr Arni gives a history of the opponent company and states that it is the owner of two Australian trade mark registrations in Class 14, which include the word ETERNA.  He also attaches an exhibit to his declaration, which comprises a list of overseas trade mark registrations that include that word.  He gives further details on the use of his company's mark in Australia, and lists the number and value of sales in this country since 1971.  He also encloses annual worldwide sales figures of goods bearing the mark, copies of promotional material, and a brochure bearing the ETERNA mark.

The applicant's evidence in answer comprises a declaration and exhibits by Phillipe Cambon, a Director of the applicant, who outlines the history and activities of the applicant company and related overseas watch manufacturers, importers and distributors.  He says that his company has the exclusive right of supply and distribution in Australia of watches supplied by the Advance Far East Company, and that the applicant also has been given consent by that company and the related Advance USA Company to use the Eternity mark here.  He attaches, as exhibits, an Advance USA 1997 catalogue, listing watches sold in the USA under that mark and a copy of an example of the applicant's goods imported into Australia since September 1998.  Mr Cambon also gives details regarding the use of his company's mark, where they are sold in Australia - he says that the sole retailer in this country is the Big W chain - and the retail costs of his company's watches bearing the mark.

The evidence in reply in the matter includes another declaration by Mr Arni (second Arni declaration), where he gives more detail on ETERNA watches sold in Australia from 1932 to 1998.  He lists the countries where these goods are sold, describing the outlets there as being "prestigious jewellery stores" and duty free shops, both of which he says are frequented by tourists and other international travellers.  He attaches a list of the opponent's Swiss distributors.  Mr Arni also provides detail on the promotion of his company's watches throughout the world in a range of print media and he attaches copies of pages of publications showing the ETERNA mark in advertising.  He discusses the price range of the opponent's watches, and includes a catalogue and a price list as examples of this.

Also included in the evidence in reply is a declaration by Martin Bachmann, the Managing Director of S.A. Desco Australia Pty Ltd, the exclusive distributor of ETERNA watches in the Asia/Pacific region, who describes his company's relationship with the opponent and his belief as to the reputation of the opponent's watches.  He describes the watches' supply to retailers in New South Wales and Victoria and "other" Australian states.  He gives the average price of an ETERNA watch in Australia and gives sales figures of these watches in Asia.  He attaches, as an exhibit, a catalogue of the opponent's watches sold in Australia.

Next in the evidence in reply is a declaration of Peter Oetterli, a Director of Swiss Watch Service Centre Pty Ltd.  Mr Oetterli is a watchmaker and repairer, specialising in the repair of Swiss watches.  He declares as to his knowledge of Swiss watches in general and to his awareness of ETERNA watches.  He says that he sells and repairs these watches in his store.  He declares his viewpoint in relation to the fame of the opponent's watches and describes various watches, which he says are collection pieces.  He further declares as to his belief regarding the deception and confusion which would ensue if the present mark is registered.

Completing the evidence in reply is a declaration by Margaret Ryan, a consultant to the opponent's attorneys, Phillips Ormonde and Fitzpatrick, who declares as to the numbers of people who travel to and from Switzerland, Hong Kong and Singapore, attaching copies of Australian Bureau of Statistics tables relating to the movements of such travellers.

Submissions
Both Ms Ryan, for the opponent, and Mr Logan, for the applicant, made quite comprehensive submissions in relation to the notice of opposition.  I will not repeat them in detail here.  However I will refer briefly to any points which they made, where I consider it would be relevant in explaining my decision.

Submissions and analysis
As I have already said, Ms Ryan advised at the hearing that she would only be relying upon the grounds which she pursued at the hearing - those under ss.44, 58 and 60.  Consequently, those grounds form the basis of this decision and the reasons for it.

Section 44
Substantially identical or deceptively similar trade marks
The relevant part of s.44 reads as follows:

44.(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.

In relation to this ground, Ms Ryan's main arguments centred around the proposition that the applicant's trade mark Eternity is substantially identical with, or at least deceptively similar to, the opponent's prior registered trade marks for the same or similar goods.  These marks comprise registration numbers 87233(14) - consisting of the word ETERNA and covering the goods: " Watches, watch movements and alarm clocks"; and 333779(14) - for the mark as shown below:

and the goods:

Watches, wristlet watches, table and desk clocks, pendant watches, desk clocks, watch cases, watch movements, watch chains, watch straps, watch bands, horological instruments and apparatus, chronometric instruments and apparatus, parts and fittings for all the aforesaid goods, jewellery and all other goods included in Cl. 14 but excluding household containers and utensils of precious metals.

In the case of Registrar of Trade Marks v Woolworths Limited 45 IPR 411 (the WOOLWORTHS METRO case) at 425, French J said that:

The logic of s.44(2) suggests that the determination whether goods are closely related to services the services in question is logically antecedent to the determination whether the trade mark in respect of the services is deceptively similar to that in respect of the goods.

This would also seem to apply where the competing marks both cover goods - as in the present instance.  Given this, I have taken into consideration the submissions by both parties to determine whether the respective mark's goods can be considered to be "similar" in terms of s.44 - not, as submitted by Mr Logan, whether they are of "the same description".  In this regard, Ms Ryan referred to the dictionary meanings of the words "horologe" and "chronometer" which were given as, "any instrument for indicating the time" and "a time keeper with a special mechanism for ensuring accuracy", respectively.  Accordingly, she submitted, the opponent's trade marks are registered for the same goods as those covered by the specification here.

Mr Logan made quite comprehensive submissions in attempting to refute this.  He referred to the primary criteria for determining goods "of the same description": the nature, uses and trade channels of the respective goods - as cited in John Crowther & Sons (Milnsbridge) Ltd's Appn (1948) 65 RPC 369 at 372. He argued that these were different in both cases, saying that the costs and methods of sale of the respective sets of goods were so unalike as to render them not the same, or of the same description. He pointed for support here, to the case of Champagne Louis Roederer v Resource Management Services Pty Ltd (1995) 30 IPR 553 (the CRYSTAL RIDGE case), where the circumstances of sale, quality and cost were considered, when comparing the respective marks' goods.  He added that one of the opponent's registrations here covered "all goods" in Class 14 and, because that meant there were items included in that description which were not related to time keeping apparatus, then this also meant there was a distinction between the applicant's and opponent's goods.

In Jellinek's Appn (1946) 63 RPC 59, which was quoted with approval in Crowther's Appn, supra, Romer J. outlined the tests for determining the similarity of sets of goods: whether the respective goods  are of the same nature; whether they are used by the same people for the same purposes; and whether the trade channels are the same.  However, no one of these tests in itself is conclusive and the assessment, as per Lord Justice Evershed's directives in re J. Lyons and Coy Ltd's Appln [1959] RPC 120 - as approved by Burchett J. and Evershed M.R. in Polo Textiles Industries Pty. Ltd. and Anor v Domestic Textiles Corporation Pty Ltd 26 IPR 246 - must be on the basis of business realities and common sense.

Sub-section 14(1) defines similar goods as those being either the same or of the same description as each other.  As Ms Ryan pointed out, the horological and chronometric devices which are the specified goods here must, by definition, include watches.  Watches are also included amongst the goods of the opponent's registrations.  It matters not if, as argued by Mr Logan, there are other items which are also covered by one or both of the opponent's marks.

In any comparison of goods under s.44 of the Act, I must take into consideration the notional fair use of the presently applied-for mark on the goods contained in the specification - as per Smith Hayden & Co. Ltd's Appl'n 63 RPC 97 at 101. This is irrespective of what can, or cannot be shown concerning actual use in the marketplace. None of the specifications of goods under consideration here includes a restriction as to price, quality, or method of sale. They could therefore be sold at any price, to customers at either end of the market, and in a different manner to what Mr Logan has suggested is currently the case. It is here, I think, that the present situation can be distinguished from that of the CRYSTAL RIDGE case, supra, where the goods were "champagne".  That product is legally defined as a particular style of sparkling wine, under an international agreement to which Australia is a signatory.  Champagne originates in a small, geographically indicated area in France, is of a certain style and quality, and is accordingly placed in a particular price range.  As I have already said, watches, without any other qualification, are watches.

Given all of the foregoing, I think that there is no other conclusion that I can draw than that the goods sold by both parties are indeed similar, if not the same.  I will now move on to determine whether the respective trade marks are, as they are claimed by the opponent to be, substantially identical or deceptively similar.

Ms Ryan pointed to various decided cases which outline the accepted tests to be considered when comparing opposing parties' marks.  She pointed to several features in the present marks which she said rendered them substantially identical or deceptively similar.  She, alleged these to be, inter alia: the marks' aural and visual similarity; their common derivation, their shared stem and first two syllables; their conceptual similarity; and the inference, which some persons might draw, that all of the marks have a reference to the word ETERNAL.  On his part, Mr Logan submitted that the subject marks were clearly not substantially identical with each other, nor were they deceptively similar.  This was because they were, despite Ms Ryan's claims, visually and aurally distinct, and also because the opponent's marks included an invented word, while the applied for mark was a dictionary one.  He said that this was particularly so in relation to the opponent's mark, which included the five balls device.

Ms Ryan said that the only marks on the Register which contained the part word ETERN- in Class 14 belonged to the opponent and that this might lead some purchasers to wrongfully assume a connection in trade.  This was especially important, she said, because it is the beginning of words which is the most important aspect when assessing whether marks are deceptively similar.  She said that another significant factor was that people often imperfectly remembered trade marks.  Additionally, it was the case here that the marks in question would usually be shown on small watch faces, making close inspection difficult.

Ms Ryan further submitted that either party's goods could, conceivably, be sold through the same channels and to the same people.  In his turn, Mr Logan said that the circumstances of sale, including the very different prices of the respective goods, their different trade channels and the different target markets, together with the lack of instances shown of actual confusion were all pertinent considerations.  It is true, as Mr Logan submitted, that the parties here presently cater to different ends of the market although, as I have already said, none of the statements of goods in question have any restrictions as to price or quality.  Notwithstanding this, given the huge price differential between the goods, and the opponent's very heavy emphasis on quality and tradition in its marketing, it would seem to be very unlikely if that party moved "downmarket".

In deciding whether or not competing trade marks are substantially identical or deceptively similar in relation to each other, the tests are conveniently laid out in such cases as Australian Woollen Mills Ltd v F. S. Walton & Co Ltd (1937) 58 CLR 641. and Shell v Esso, supra, where, in the latter case, Windeyer J said, at 414 and 415:

(In relation to determining substantial identity)...(the marks should) 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.

(In relation to determining deceptively similarity)   The marks are not now to be looked at side by side.  The issue is not abstract similarity, but deceptive similarity.  Therefore the comparison is the familiar one of trade mark law.  It is between, on the one hand, the impression based on recollection of the plaintiff's mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant's television exhibitions.

In relation to whether the two party's marks can be considered to be substantially identical, I think that, when the marks are looked at together, there are differences which immediately become apparent.  The subject mark is an ordinary four syllable word Eternity.  On the other hand, the opponent's marks both include the invented, three syllable word, ETERNA - one of which also includes a ball device.  Given the clear differences which emerge from such a comparison, I can only deduce that the respective marks are not substantially identical and I now move on to determine whether or not they are deceptively similar.

Section 10 of the Act defines a trade mark as being deceptively similar to another trade mark if it so nearly resembles that mark that it is likely to deceive or cause confusion.  Consideration should also be given to a normal person's impression based on a recollection of the opponent's marks.  In this regard, Luxmoore, L.J. expounded the test referred to as the doctrine of "imperfect recollection" in Rysta Ltd.'s Appn. (1943) 60 RPC 87. Ms Ryan has argued that the look and sound of the words ETERNA and ETERNITY are very similar and that the effect or overall impression produced on customers' minds is the same.  Mr Logan has submitted that, although the marks share two syllables and something of the same idea, there are enough differences between them to mean that very few people would be confused as to their respective origins.

It is obvious that the opponent's trade marks and the subject mark all contain the word stem ETERN-.  However, in my opinion, the opponent's registrations for the word ETERNA do not automatically preclude other traders from using the part word ETERN- in their own trade marks - as long as they are not so close that they cause deception or confusion.  I do concede that there may be some reference in people's minds to the concept of eternity when confronted with the word ETERNA but this does not mean that they would immediately see the two words as being deceptively similar.  I think it is the case that a person would need to make a number of leaps of logic to link that word with the present trade mark.  It is important to note that the present mark Eternity is an ordinary dictionary word and that the word ETERNA is a obviously coined one.  I cannot agree that customers would believe that the latter word is a foreign one meaning ETERNAL or, even if they did, that they would think that there was some connection with the mark for which registration has been applied for here.  I think it is significant to note at this point that there have been no instances of confusion included in the evidence before me, in relation to the respective marks.

Given all of the above considerations, I am not satisfied that the applicant's trade mark is substantially identical with, or deceptively similar to, the marks already registered by the opponent.  Accordingly, I find the opponent is not successful on this ground of its opposition.

Section 58
This section reads:

58. The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.

The term "owner" in the Trade Marks Act 1995 equates to that of "proprietor", as referred to in the Trade Marks Act 1955 - see p.2 of the Readers Guide to the 1995 Act.  The initial onus, with respect to ownership, is on the applicant for registration.  As is stated in s.27 of the Act:

27.(1) A person may apply for the registration of a trade mark in respect of goods and/or services if:

(a) the person claims to be the owner of the trade mark; and
           (b) one of the following applies:

(i)the person is using or intends to use the trade mark in relation to the goods and/or services;

(ii)the person has authorised or intends to authorise another person to use the trade mark in relation to the goods and/or services;

(iii)the person intends to assign the trade mark to a body corporate that is about to be constituted with a view to the use by the body corporate of the trade mark in relation to the goods and/or services.

Ownership of a trade mark depends on a combination of authorship and first use and, as per Shell Company (Australia) Limited v Rohm and Haas Co (1949) 78 CLR 601, may be claimed either on being the first user of the trade mark in Australia, in relation to the nominated goods, or on the basis of the making of an application for registration. Any small amount of use will suffice, but the effect of the act relied on to constitute use must be the creation, in the minds of those concerned, of an impression that the goods of a particular trader are being offered for sale, in this country, under the trade mark.

The applicant here was the first to apply for the trade mark Eternity in Class 14 in Australia and, from the evidence, appears to have used it in trade since September 1998.  It has thus satisfied the onus upon it and that burden now shifts to the opponent to show that the applicant is not the owner of the trade mark.

The dispute of a claim to ownership of a mark can only proceed to be considered where the opponent can also show that the word or words it relies upon as being owned by itself or another person is substantially identical with the mark, the subject of the application for registration.  It is not enough that the competing trade marks might be considered deceptively similar.  As Gummow J. said in Carnival Cruise Lines Inc v Sitmar Cruises Ltd. (1994) AIPC 91-049 at 38,114, when referring to the concept of proprietorship in the Trade Marks Act 1955, and to Shell Co. (Aust.) Ltd v Rohm and Haas, supra:

[Shell v Rohm and Haas] does not supply any general authority for the proposition that in the case of disputed claims to proprietorship under the present statute anything less than substantial identity between the two marks will suffice. The phrase "substantially identical"  was discussed by Windeyer J. in The Shell  Company of Australia Limited v Esso Standard Oil (Australia) Limited (1961-1963) 109 CLR 407.

As I have already said, in relation to the s.44 ground, when the test propounded by Justice Windeyer is applied, the trade marks used by the respective parties are not substantially identical with each other - despite the common word stem ETERN-.  Therefore, the claim that the applicant is not the owner of its trade mark because the opponent had first used a mark which is so close as to be virtually the same, fails at the first hurdle.

Accordingly, I find that the opponent is not successful on the ground that the applicant is not the owner of the trade mark which is the subject of this application.

Section 60
Trade mark similar to trade mark that has acquired a reputation in Australia
This section reads:

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.

There is no change in the law from the Trade Marks Act 1955 that there is an evidentiary onus on the opponent, in the first instance, to establish the extent of its reputation for its mark in Australia - re Heerey J., when referring to s.28 of that Act, in Nettlefold Advertising Pty Ltd v Nettlefold Signs Pty Ltd (1997) 38 IPR 495 at 501. The opponent would need to establish that that reputation was sufficient amongst a substantial number of persons, as at the critical date of the filing of the present application - as per Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, so that deception or confusion was bound to occur amongst a substantial number of people, likely to be concerned in the purchasing of the particular goods, because of the use of the applicant's mark - The Kendall Company v Mulsyn Paint and Chemicals (1963) 109 CLR 300.

I think it is the case here that the evidence shows that the opponent has a reputation in relation to quality time-pieces which are available in duty free stores and in major jewellery stores.  This reputation seems, from the evidence, to extend to international travellers, and also to discerning customers and collectors around the world.  However, despite this global renown, I am not satisfied, from the evidence, that a significant number of the undoubtedly large number of Australians who now travel overseas would have heard of the opponent's trade marks, or its goods.  I have considered the evidence of the Australian Bureau of Statistics figures, which are included with Ms Ryan's declaration.  These show the arrivals and departures of all people, not only Australians, into and from Australia, Switzerland, Hong Kong, and Singapore.  However, those figures without more do not show whether these people were exposed to the opponent's marks during their travels or, if they were, whether they even remember them.  Similarly, Mr Otterli's declaration merely shows that he believes that Australian travellers and collectors of watches would be very familiar with the ETERNA marks.  This is simply his opinion and the value of this kind of general assertion, made by an expert in a particular field and put into evidence, was questioned by the Full Federal Court in C A Henschke & Co v Rosemount Estates Pty Ltd (2000) AIPC ¶91-640. It is also apparent, from Mr Otterli's declaration, that the number of the opponent's watches sold in this country is not high, and that they are relatively expensive and of high quality.

Ms Ryan said in her submissions that the average retail price of ETERNA watches is "less than AUD$1,000 to in excess of AUD$30,000", while Mr Bachmann, in his declaration, says that the average price in Australia is approximately $2,000.  All of this indicates to me that the opponent's reputation must lie with a select group of relatively wealthy and discerning collectors or travellers - very much a niche market.  I believe that these people would be well aware of the product they wished to buy and, by extension, the trade mark which should be on it.  The opponent's goods are not "bags of sweets" items but comparatively expensive wrist watches which are purchased by aficionados of the opponent's goods.  I consider that these individuals would not be likely to believe that the opponent had moved down to the cheaper end of the watch market.

The present circumstance, in my opinion, is one where there is no "real tangible danger of deception or confusion occurring", as set out in the tests laid down in Southern Cross, supra, at 495. The test for deception or confusion was more recently dealt with in the judgment of Justice French in the WOOLWORTHS METRO case, supra, at 426, where he said, in considering the phrase "likely to deceive or cause confusion":

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": Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 at 594-5 per Kitto J.

Notwithstanding the foregoing, I have already said that I consider that the applicant's and opponent's marks to be neither substantially identical nor deceptively similar.  Therefore, any discussion regarding the existence or not of a significant reputation for the applicant's trade marks which might lead to a "real tangible danger of (deception or confusion) occurring" would appear to be redundant.

Accordingly, I find that the opponent has also failed on this leg of its opposition.

Conclusion
I have found, as the Registrar's delegate, that the opponent has not been successful on any of the grounds on which it relied at the hearing.  Accordingly, I dismiss the opposition in total.  I direct that trade mark application number 771190 may proceed to registration, providing all of the appropriate fees have been paid.

Costs
There is no reason that the costs here should not follow the cause.  Accordingly, I also direct that the opponent is to pay the applicant its costs in accordance with schedule 8 of the Trade Marks Regulations.  If required, as per the provisions of reg. 21.13, a Trade Marks officer appointed by the Registrar, will tax and certify those costs.

Ian Forno
Hearing Officer

4 April 2001