Ferrero S.p.A v Nuts-about-tella Pty Ltd

[2018] ATMO 147

TRADE MARKS ACT 1995

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

Re:Opposition by Ferrero S.p.A to registration of trade mark application 1747769 (43) – nuts-about-tella - in the name of Nuts-about-tella Pty Ltd

Delegate:

Nicholas Smith

Decision on the Written Record

Decision:

2018 ATMO 147

Trade Marks Act 1995 (Cth) - Section 52 opposition: ss 42, 44, 60 and 62A considered – none established – trade mark to proceed to registration

Background

1.  This decision concerns an opposition brought by Ferrero S.p.A (‘Opponent’) pursuant to s 52 of the Trade Marks Act 1995 (Cth) (‘Act’) to the registration of the trade mark which is the subject of the application detailed below in the name of Nuts-about-tella Pty Ltd (‘Applicant’): 

Application Number:	1747769
Filing Date:	28 January 2016
Services:	Class 43: Providing food and drink (‘Applicant’s Services’)
Trade Mark:	nuts-about-tella	(‘Trade Mark’)

1. Following the advertisement on 23 June 2016 in the Australian Official Journal of Trade Marks of the application’s acceptance for possible registration, the Opponent filed a Notice of Intention to Oppose on 22 August 2016.  The Opponent then filed a Statement of Grounds and Particulars (‘SGP’) on 22 September 2016. The SGP raised grounds of opposition under ss 42, 44, 60 and 62A of the Act. The Applicant filed a Notice of Intention to Defend on 28 October 2016.

   Evidence

   3.  The Opponent filed Evidence in Support of its opposition (‘EIS’) on 2 February 2017.  This evidence consists of a declaration made on 1 February 2017 by Derek Lath, the Institutional Affairs Director of Ferrero Australia Pty Ltd, a related body corporate of the Opponent, with exhibits DLL-1 to DLL-25 (‘Lath Declaration’).

2. The Applicant filed Evidence in Answer (‘EIA’) on 16 May 2017.  This evidence consists of a declaration made on 16 May 2017 by Mark Anthony Elkhouri, the director of the Applicant, with Exhibits ME-1 to ME-6 (‘Elkhouri Declaration’). 

3. The Opponent filed Evidence in Reply (‘EIR’) on 21 July 2017.  This evidence consists of a declaration made on 20 January 2017 by Julie McIntosh, the Chief Financial Officer of Ferrero Australia Pty Ltd, with exhibits JM-1 to JM-2 (‘McIntosh Declaration’).

4. Once the time allowed for filing evidence had ended the parties were given an opportunity to request a hearing or to file written submissions.  Neither party chose to avail themselves of these opportunities at that time.  By letter issuing from IP Australia on 8 March 2018 the parties were notified that as neither party had requested a hearing the matter would be given to a delegate of the Registrar for a decision based on the written record.  The letter indicated that the parties had one month from the date of the letter to file any written submissions they wished to reply upon.  On 9 April 2018 the Applicant filed its submissions (‘Applicant’s Submissions’).  On 17 May 2018 the Opponent filed its submissions (‘Opponent’s Submissions’). 

5. I am a delegate of the Registrar of Trade Marks and I am to decide the opposition as required by s 55 of the Act which provides that, unless the proceedings are discontinued, dismissed, or have lapsed under s 54A the Registrar must, at the end, decide:

   (a)to refuse to register the trade mark; or

   (b)to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;

   having regard to the extent (if any) to which any ground on which the application was opposed has been established.  In doing so I take account of the written record comprised of the materials mentioned in the preceding paragraphs.

   The Opponent

   8.  The Opponent is an Italian confectionary company. 

6. The Opponent is, amongst other marks, the registered owner of the trade marks set out below (‘Opponent’s Trade Marks’). 

Number	Trade Mark	Priority Date	Goods and Services
210675	NUTELLA (‘Nutella Mark’)	2 Jun 1967	Class 29: All goods in this class Class 30: All goods in this class excluding bread, biscuits, cakes, pastry and other bakery products and confectionary
282424	NUTELLA	11 Oct 1974	Class 30: Spread cream comprising cocoa
394170	(‘394170 Mark’)	14 Jul 1983	Class 29: All goods in Class 29 Class 30: All goods in Class 30
394172	14 Jul 1983	Class 29: Spread creams in Class 29 Class 30: Spread creams in Class 30
1422008	(‘Red Mark’)	27 Jan 2011	See Annex 1 Note Endorsement: Colour Claimed: BLACK, RED-ORANGE

1. The Lath Declaration contains the following claims/statements:

   ·     In 1949 the Opponent’s founder Pietro Ferrero created a hazelnut and cocoa spread, named Supercrema Giadujia, which in 1963 was renamed Nutella.

   ·     By 2015 the Opponent’s Nutella products were sold in approximately 170 countries around the world and have received global promotion through significant sponsorship and marketing.

   ·     In Australia, Nutella-branded spread and other goods branded with the Nutella Mark have been sold continuously through all states and territories in Australia since 1970.  The Opponent’s Trade Marks have been used by the Opponent and its licensees on advertising, product packaging, display boxes and point of sales material.  The Opponent’s Trade Marks have been promoted extensively in Australia for almost 40 years through a variety of marketing methods including television advertising and point of sale materials.

   ·     The Opponent’s sales in Australia from 1995 to 2016, as measured in Australian dollars, and from 1981-2015 in kilos, are very significant.

   ·     Given the visual, aural and conceptual similarities between the Opponent’s Trade Marks and the Trade Mark, the Opponent believes that consumers will be deceived and/or confused by use of the Trade Mark.

2. The McIntosh Declaration contains the following claims/statements:

   ·     The Opponent occasionally grants authorisations to third parties to use the Opponent’s Trade Marks.  This included granting a limited authorisation to the organisers of the Nutella-Palooza event referred to in the Elkhouri Declaration (discussed below).  No authorisation has been granted to the Applicant and no authorisation was granted to participants in the Nutella-Palooza event outside the particular event.

   The Applicant

   12.     The EIA provides very little information about the Applicant, though it appears that the Applicant is an Australian company that operates a food truck that sells products featuring the Applicant’s Nutella product.

3. The Elkhouri Declaration contains the following claims/statements:

   ·     The declarant has been aware of the Opponent and its reputation in the Nutella Mark since childhood.  He identifies a large number of businesses that have used the Nutella Mark and related marks to promote their products that use the Opponent’s Nutella products.  Such businesses frequently promote their products on social media.

   ·     In 2016 the declarant participated in a Nutella festival in Adelaide called Nutella-Palooza where his food truck sold dessert pizzas.  His food truck was one of a large number of vendors selling products that used the Nutella Mark to identify Nutella as being the key ingredient.

   ·     To the declarant’s knowledge, his business has never caused any confusion with customers, who understand that his business is independent of the Opponent and sells products that include Nutella as a key ingredient.

   Grounds of Opposition, Onus and Standard of Proof

   14. As indicated above in the SGP the Opponent nominated grounds of opposition under ss 42, 44, 60 and 62A of the Act. To successfully oppose the application the Opponent needs to establish at least one of those grounds.

4. The onus of proof in an opposition rests upon the Opponent.[1]  The relevant standard of proof is the ordinary civil standard based on the balance of probabilities.[2]  The date at which the rights of the parties are to be determined is 29 January 2016 (‘relevant date’), being the priority date of the application in Australia.[3]

   [1] Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58, [32].

   [2] Following Pfizer Products Inc v Karam (2006) 70 IPR 599, [6]-[26], and Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133].

   [3] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 595.

   Discussion

   Section 44

   16. The relevant provisions of the Act with respect to the ground of opposition pursuant to s 44 are reproduced below:

   Section 44 - Identical etc. trade marks

   (1)…

   (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.

   Note 2: For similar services see subsection 14(2).

   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.

   (3)If the Registrar in either case is satisfied:

   (a)that there has been honest concurrent use of the 2 trade marks; or

   (b)that, because of other circumstances, it is proper to do so;

   the Registrar may accept the application for the registration of the applicant's trade mark subject to any conditions or limitations that the Registrar thinks fit to impose. If the applicant's trade mark has been used only in a particular area, the limitations may include that the use of the trade mark is to be restricted to that particular area. 

   Note:  For limitations see section 6.

   (4)If the Registrar in either case is satisfied that the applicant, or the applicant and the predecessor in title of the applicant, have continuously used the applicant's trade mark for a period:

   (a)beginning before the priority date for the registration of the other trade mark in respect of:

   (i)              the similar goods or closely related services; or

   (ii)             the similar services or closely related goods; and

   (b)ending on the priority date for the registration of the applicant's trade mark;

   the Registrar may not reject the application because of the existence of the other trade mark.

   Note 1: An authorised use of the trade mark by a person is taken to be a use of the trade mark by the owner of the trade mark (see subsection 7(3)).

   Note 2: For predecessor in title see section 6.

   Note 3: For priority date see section 12.

   Section 10 - Definition of deceptively similar

   For the purposes of this Act, 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.

   17. To successfully oppose the application pursuant to s 44 of the Act the Opponent must establish the requirements of s 44(2), i.e. that at least one of the trade marks upon which it relies:

   ·     has a priority date which is earlier than that of the Trade Mark (‘the first requirement’);

   ·     is substantially identical with or deceptively similar to the Trade Mark (‘the second requirement’); and

   ·     is in respect of similar services, and/or goods which are closely related to, the Applicant’s Services (‘the third requirement’).

5. In the event that each of these requirements are satisfied by the Opponent it may be possible for the Registrar to accept the application if the Registrar is satisfied that there has been honest concurrent use of the Trade Mark, other circumstances exist which would make registration of the Trade Mark proper, or that the Applicant has continuously used the Trade Mark beginning before the priority date of the Opponent’s relied upon mark, pursuant to ss 44(3) and 44(4) of the Act.

6. The Opponent has particularised the ground of opposition in the SGP by reference to the Opponent’s Trade Marks other than the Nutella Mark (‘s 44 Marks’). Each of the s 44 Marks has a priority date that is earlier than the priority date of the Trade Mark. The Red Mark is registered for a range of goods and services including services which are identical to the Applicant’s Services.

7. The 394170 Mark is registered for all goods in class 30 which would include coffee.

8. With respect to trade marks 282424 and 394172 the question I must consider is whether the class 29 and 30 foodstuffs for which these are registered, being spread creams, are closely related to the Applicant’s Services, being provision of food and drink in class 43.  This question has been considered in previous cases before the Registrar[4], with the consensus being that unless there is a particular exception (such as the nature of the class 29 and 30 goods being such that they would be expected to be sold from an entity providing the class 43 services[5]) the class 43 services are not closely related to the class 29 and 30 goods.  In the present case the nature of spread creams are not such that they would be expected to be sold from enterprises providing the Applicant’s Services and hence I find that the goods for which trade marks 282424 and 394172 are registered are not closely related to the Applicant’s Services. 

   [4] see, for example, Sizzler Restaurants International Inc v Sabra International Pty Ltd (1990) 20 IPR 331 and Bickfords Australia Pty Ltd v Frank Ward [2008] ATMO 84.

   [5] See Shanghai Longfong Foods Co, Ltd v International ANEC Pty Ltd AND Junko Morimoto [2012] ATMO 41.

9. The question is more complex with respect to the 394170 Mark which is registered for all goods in class 29 and 30.  The broad nature of the goods for which the 394170 Mark is registered is such that it would include goods that would be expected to be sold from an entity providing the class 43 services.[6]

   [6] See Shanghai Longfong Foods Co, Ltd v International ANEC Pty Ltd AND Junko Morimoto [2012] ATMO 41 (cooked dumplings, spring rolls etc. and restaurant services), and Aromas Pty Ltd (formerly Intercof Pty Ltd) v Aroma Coffee & Tea Co Pty Ltd (1997) 40 IPR 75 (coffee shop services and coffee).

10. The first and third requirements are satisfied with respect to the Red Mark and the 394170 Mark.  However it is only necessary to consider the Red Mark going forward, since the marks are essentially identical and the Red Mark is registered for services that are identical to the Applicant’s Services.  Were I to conclude that the Red Mark was not substantially identical or deceptively similar to the Trade Mark I would necessarily reach the same conclusion with the 394170 Mark. 

    Substantially identical or deceptively similar

11. I will now consider whether the Trade Mark is substantially identical to the Red Mark.  When considering ‘substantial identity’ in Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd Windeyer J said:

    In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison.[7]

    [7] (1963) 109 CLR 407, [12].

12. The Trade Mark and the Red Mark are set out below:

    nuts-about-tella              

13. On a side by side comparison there is a clear difference between the respective trade marks, with the Trade Mark consisting of 3 words, only one of which is incorporated in the Red Mark.  The differences between the respective trade marks are sufficient for me to conclude that the respective trade marks are not substantially identical.  I move then to consider whether the Trade Mark and Opponent’s Trade Mark are deceptively similar.

14. The principal authority for guidance in determining whether trade marks are deceptively similar also comes from the judgment of Windeyer J in Shell Co (Aust) Ltd v Esso Standard Oil (Aust) Ltd:

    On the question of deceptive similarity, a different comparison must be made from that which is necessary when substantial identity is in question. 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 [trade mark].[8]

    [8] Ibid [13].

15. Jacobson J in Millennium & Copthorne International Limited v Kingsgate Hotel Group Pty Ltd summarised the principles of deceptive similarity with reference to the authorities as follows:

    Without seeking to reformulate the various statements of principle stated in the Full Court authorities, it is sufficient for present purposes to identify the critical elements which seem to me to inform the issue of deceptive similarity in the present case. There are nine elements.

    First, the judgment of likelihood of deception is a practical one. It requires an assessment of the effect of the challenged mark on the minds of potential customers: Woolworths[9] at [49]; Australian Woollen Mills[10] at 658.

    [9] Registrar of Trade Marks v Woolworths Ltd [1999] FCAFC 1020.

    [10] Australian Woollen Mills Ltd v FS Walton & Co Ltd [1937] HCA 51; (1937) 58 CLR 641.

    Second, the question of deceptive similarity is not to be decided by a side-by-side comparison. It is to be determined by a comparison of the impression based on recollection of the opponent’s mark that persons of ordinary intelligence and memory would have, and the impression that those persons would get from the opposed trade mark: Crazy Ron’s[11] at [73]; Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd [1963] HCA 66; (1963) 109 CLR 407 at 415 per Windeyer J.

    [11] Crazy Ron’s Communications Pty Ltd v Mobileworld Pty Ltd [2004] FCAFC 196; (2004) 209 ALR 1.

    Third, allowance must be made for imperfect recollection: Crazy Ron’s at [74].

    Fourth, the effect of the spoken description must be considered: Woolworths at [49]; Crazy Ron’s at [75]; Australian Woollen Mills at 658.

    Fifth, it is necessary to show a real tangible danger of deception or confusion: Woolworths at [43] and [50]; Crazy Ron’s at [76]; Southern Cross Refrigerating[12] at 594 – 595.

    [12] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592.

    Sixth, a trade mark is likely to ‘cause confusion’ if the result of its use will be that a number of persons are ‘caused to wonder’ whether the two products come from the same source: Woolworths at [50]; Southern Cross Refrigerating Co at 595. This test sets a lower threshold than that which is required to establish that conduct is likely to mislead or deceive under s 18 of Schedule 2 of the Competition and Consumer Act 2010 (Cth): see McWilliam's Wines Pty Ltd v McDonald's System of Australia Pty Ltd [1980] FCA 159; (1980) 33 ALR 394 at 398 per Smithers J.

    Seventh, all surrounding circumstances must be taken into consideration. The circumstances include those in which the marks will be used, and in which the goods or services will be bought and sold, as well as the character of the probable acquirers of the goods and services: Woolworths at [50]; Crazy Ron’s at [86] – [89]; Southern Cross Refrigerating at 595.

    Eighth, the question of whether there is a likelihood of confusion is not to be answered by reference to the manner in which a party has used the mark, but by reference to what an applicant can do. That is to say, the use to which it can properly put the mark if registration is obtained: Woolworths at [50]; Berlei Hestia Industries Ltd v The Bali Company Inc [1973] HCA 43; (1973) 129 CLR 353 at 362 per Mason J.

    Ninth, if a registered trade mark includes words which can be regarded as an ‘essential feature’ of the mark, another mark that incorporates those words may cause a tangible danger of deception or confusion by reason of consumers retaining an imperfect recollection of those words: Crazy Ron’s at [79]. However, care must be taken to not too readily characterise words in a composite trade mark as an ‘essential feature’ because to do so may effectively convert a composite mark into something different: Crazy Ron’s at [100].[13]

    [13] [2012] FCA 1022, [38]-[46].

1. On balance, I do not consider the marks to be deceptively similar. Aurally the marks are distinctive, with the Trade Mark being pronounced ‘nuts about tella’ and the Red Mark being pronounced ‘nu-tella’. Visually, while they share the element ‘tella’ and both begin with the letters ‘nu’, I consider it likely that the Trade Mark, when considered as a whole, will be viewed as three separate words, none of which is identical to the one word that makes up the Red Mark. While I accept that the Trade Mark may refer to the Red Mark (and the Nutella Mark more broadly (discussed further under the s60 ground of opposition below), and consider it likely that the intention of the Applicant was to select a mark that evoked the Opponent’s Nutella mark, I consider that the overall difference between the marks to be so significant, that when considered as a whole, even allowing for imperfect recollection, it is unlikely that the use of the Trade Mark will deceive or cause confusion because of any similarity it has to the Red Mark (or the 394170 trade mark).

2. I find that the Opponent has failed to establish the ground of opposition under s 44.

   Section 60

   31. Section 60 of the Act is reproduced below:

   Section 60 - Trade mark similar to trade mark that has acquired a reputation in Australia

   The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:

   (a)another trade mark had, before the priority date for the registration of the first‑mentioned trade mark in respect of those goods or services, 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.

3. To establish a ground of opposition under s 60 an opponent must demonstrate that as at the relevant date there was another trade mark which had acquired a reputation in Australia amongst a significant or substantial number of persons in the relevant market such that use of the Trade Mark would be likely to deceive or cause confusion.[14]

   [14] The present paragraph and the following paragraphs summarizing the requirements under s 60 of the Act are paraphrased from the decision of the Registrar’s Delegate in Australian Boutique Markets Pty Ltd v Rachael Zelensky and Jeffrey Zelensky [2013] ATMO 97.

4. In McCormick & Co Inc v McCormick, Kenny J considered what is intended by the word ‘reputation’ as used in s 60. Her Honour had consulted the Macquarie Dictionary and on the basis of the definition provided concluded that it was ‘the recognition of the [trade mark] by the public generally’.[15]  Her Honour quoted with approval the following words of Lockhart J in Re ConAgra Inc v McCain Foods (Aust) Pty Ltd:

   [R]eputation within the jurisdiction may be proved by a variety of means including advertisements on television or radio, or in magazines and newspapers within the forum. It may be established by showing constant travel of people between other countries and the forum and that people within the forum, (whether residents there or persons simply visiting there from other countries) are exposed to the goods of the overseas owner …[16]

   [15] [2000] FCA 1335, [81].

   [16] (1992) 33 FCR 302, 343.

5. On the subject of reputation Kenny J also referred to the Hugo Boss decision, where the Registrar’s delegate observed:

   [I]t is true that the assessment of the reputation of a trade mark goes far beyond mere examination of sales or turnover of goods sold under that trade mark and contemplation of the advertising and promotional figures.

   As regards a trade mark, its reputation derives both from the quantum of sales under that mark and also its esteem, or image, projected by that trade mark. The quantum of sales, advertising and promotion contributes to the ‘recognition’ component of the trade mark’s reputation. The credit, image and values projected by a trade mark attaches to the ‘esteem’ component of the reputation as do the public events and other trader’s marks with which [the] owner of the trade marks in question chooses to associate the trade marks via sponsorships, cross-promotions, ‘contra deals’ and so forth.

   It follows that a trade mark used in relation to goods with comparatively low sales may have a high and strong reputation by virtue of the high credit or esteem in which it is held, or, conversely, that a trade mark which has very high sales may have a strong reputation notwithstanding the lack of esteem that attaches to it. The particular popular images, or sets of values, that attach to the trade mark are also, therefore, important parts of the reputation of the trade mark and may be as strong an associative force in the minds of the public as the association of the trade marks with the goods or services themselves.[17]

   [17] Hugo Boss AG v Jackson International Trading Co Kurt D Bruhl Gesellschaft MbH & Co KG (1999) 47 IPR 423, 426.

6. As stated above, in assessing reputation under s 60, what constitutes a significant or substantial number of persons in the relevant market must be considered. The case of Le Cordon Bleu BV v Cordon Bleu International Ltee[18] was decided under s 28(a) of the (now repealed) Trade Marks Act 1955.  That provision did not refer to ‘reputation’ at all, only that use of the impugned trade mark would be ‘likely to deceive or cause confusion’.  Nevertheless the words of Heerey J provide some guidance:

   What is ‘significant’ or ‘substantial’ will depend on the nature of the goods or services in question. For some highly specialised products, awareness among a few thousand persons, or even less, might be sufficient … We are here concerned with foodstuffs sold in supermarkets, delicatessens, milk bars and other retail outlets. The relevant market is virtually the entire Australian population from early teenage years onwards.[19]

   [18] (2000) 50 IPR 1.

   [19] Ibid 20. Heerey J’s decision was overturned on appeal to the Full Federal Court, although not on the point quoted. Indeed the court specifically noted that his approach contained no error; see Renaud Cointreau v Cordon Bleu International Ltee [2001] FCA 1170, [75].

7. Furthermore, in practice, once the requisite reputation is demonstrated, the likelihood of deception or confusion increases the more closely the trade marks resemble each other.[20]

   [20] Qantas Airways Limited v Edwards [2016] FCA 729 at [142].

8. The Opponent has particularised the ground of opposition in the SGP in the manner set out below: 

   2.1 The Opponent has been using the Registered Marks[21] in Australia since before the priority date of the Opposed Mark.

   2.2 The Registered Marks have been used by the Opponent as trade marks in Australia in relation to food products since at least 1978.

   2.3 There is extensive evidence of such use comprising a broad range of promotional materials, packaging, and advertising.

   2.4 The Registered Marks have developed a very substantial reputation in Australia, due not only to their extensive history of use by the Opponent, but also from the media coverage that has increased the exposure and recognition of the Registered Trade Marks in Australia. As a result of this reputation, the Applicant’s use of the Opposed Mark in relation to services in Class 43 would be likely to deceive or cause confusion.

   [21] i.e. the Opponent’s Trade Marks

9. I am satisfied on the evidence before me that the Nutella Mark had, before the relevant date, acquired a very significant reputation in Australia for its hazelnut and chocolate spread, being the Nutella spread that has been sold in considerable amounts in Australia for over 40 years. The sales, advertising and esteem in which the Nutella Mark has been held in Australia is sufficient for the requirements under s 60(a) of the Act.

10. It is not sufficient that the Opponent merely establishes that its trade marks have a reputation; the Registrar must also be satisfied that because of that reputation the use of the Trade Mark would be likely to deceive or cause confusion. Discussions and decisions on the subjects of deception and confusion are legion and a good number provide relevant comments in relation to a consideration of deception and confusion for the purposes of s 60. In a case concerning infringement and passing off, Australian Woollen Mills Limited v F S Walton and Company Limited, Dixon and McTiernan JJ said the following:

    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 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 observations of men considered in the mass affords the standard.[22]

    [22] (1937) 58 CLR 641, 658.

11. In Registrar of Trade Marks vWoolworths Ltd French J highlighted the following further matters concerning confusion:

    A trade mark is likely to cause confusion if the result of its use will be that a number of persons are caused to wonder whether it might not be the case that the two products or closely related products and services come from the same source. It is enough if the ordinary person entertains a reasonable doubt. It may be interpolated that this is another way of expressing the proposition that the trade mark is likely to cause confusion if there is a real likelihood that some people will wonder or be left in doubt about whether the two sets of products or the products and services in question come from the same source.

    In considering whether there is a likelihood of deception or confusion all surrounding circumstances have to be taken into consideration. These include the circumstances in which the marks will be used, the circumstances in which the goods or services will be bought and sold and the character of the probable acquirers of the goods and services.[23]

    [23] (1999) 45 IPR 411, 428. These considerations by French J are based on principles set out by Kitto J in Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 594-5.

12. In Pottle Productions Inc v Rute Ithalat Ve Ihracat Anonim Sirketi the delegate observed that:

    The assessment of the likelihood of deception or confusion under section 60 is informed by the strength of the reputation of the Opponent’s trade mark(s), the inherent distinctiveness thereof, the degree of similarity between the trade marks under consideration and the nexus or connection between the goods and/or services of the parties. Each of these is a variable and it is possible that a trade mark’s reputation might be sufficiently strong and the degree of similarity to an opposed trade mark be so great (particularly where the trade marks are inherently distinctive) that confusion or deception will be a likelihood where very little, if any, nexus or connection exists between the goods and/or services under consideration.[24]

    [24] [2012] ATMO 124 at [40].

13. While it is not necessary to show that the marks are deceptively similar for the purposes of an opposition under s 60, as stated in Qantas Airways Limited v Edwards, ‘the degree of similarity between the allegedly conflicting marks will be a relevant consideration to be taken into account when considering the likelihood of confusion resulting from use of the opposed mark.’[25]

    [25] [2016] FCA 729 at [142].

14. While the marks are not visually or aurally close, the obvious meaning of the Trade Mark (as noted in the Applicant’s Submissions) is that the proprietor is ‘nuts about’ (i.e. very enthusiastic for) ‘tella’.  The ‘nuts’ element may also refer to the first part of the Nutella Mark.  While I have no evidence of any use of ‘tella’ as an abbreviation of the Nutella Mark, I consider that given the very significant reputation of the Nutella Mark, in the context of the provision of food and drink, the ‘tella’ element is likely to be seen by the large percentage of consumers familiar with the Nutella Mark as a reference to the Nutella product and as such the Trade Mark would be read as ‘very enthusiastic for Nutella’.  This is also clearly the intention of the Applicant.  Furthermore the Trade Mark would not be seen as a parody mark in the nature of the TENFOLDS GRUNGE Mark[26]; it is not immediately and principally recognisable as a parody of the Nutella Mark.

    [26] Southcorp Limited v Morris McKeeman [2006] ATMO 48.

15. However, while it is likely that consumers would see the Trade Mark as a reference to the Nutella product, that is not the relevant question for under s 60. As noted in Registrar of Trade Marks vWoolworths Ltd, extracted in paragraph 37 above, the question that must be asked is whether, considering all surrounding circumstances, a number of persons will be caused to wonder whether or not it might be the case that the Applicant’s Services are provided by the Opponent.  I consider that this to be unlikely. 

16. The Nutella Mark is well-known and closely connected to the Nutella spread. Consumers viewing an enterprise providing food and drink under the Trade Mark are likely to conclude that that enterprise may be Nutella-themed or offer products made with Nutella, but are unlikely to be confused into thinking that the Opponent, an Italian confectionary company offering its hazelnut spread under the Nutella Mark, has opened a business providing food and drink in Australia under the mark ‘nuts-about-tella’. By reason of the differences between the Trade Mark and the Nutella Mark, between the Applicant’s Services and the Nutella product for which the Nutella Mark has a reputation, and the likelihood that the likely consumers of the Applicant’s Services can identify the difference between the Applicant and an entity other than the Applicant offering food and drink featuring the Applicant’s Nutella spread, I am not satisfied that by reason of the reputation acquired by any of the Nutella Mark, the use of the Trade Mark for the Applicant’s Services would be likely to deceive or cause confusion. I find that the Opponent has failed to establish the ground of opposition pursuant to s 60 of the Act.

    Section 42

    46. Section 42 of the Act is reproduced below:

    42 Trade mark scandalous or its use contrary to law

    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.

    47.       The Opponent pressed this ground of opposition solely on the basis that the use of the Trade Mark would be contrary to law (s 42(b)).  The onus is on the Opponent to establish that use of the Trade Mark by the Applicant would be, rather than could be, contrary to law on the balance of probabilities.[27]  The relevant time for assessing whether an application is contrary to law is at the relevant date but ‘looking forward to prospective conduct after registration’.[28]

    [27] Advantage Rent-a-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683.

    [28] Time Warner Entertainment Co LP v Stepsam Investments Pty Ltd [2004] 59 IPR 343, 353.

    48.       The Opponent has particularised the ground of opposition in the SGP as follows: 

    The Opponent has, before the priority date of the Opposed Mark, acquired a substantial and valuable reputation in the Registered Marks in Australia. The Registered Marks are well known in Australia.

    As a result consumers are likely to be misled or deceived as to the origin of Class 43 services provided by the Applicant under the Opposed Mark.

    Use of the Opposed Mark by the Applicant in respect of the provision of food and drink would represent to members of the public, in trade and commerce in Australia, contrary to fact, that:

    (a) the Applicant is, or is associated with, the Opponent;

    (b) the Applicant has the licence, sponsorship or approval of the Opponent;

    (c) the Applicant’s goods and services have the licence, sponsorship or approval of the Opponent; and/or

    (d) the Applicant’s goods and services are provided by the Opponent or a company associated with the Opponent.

    For the reasons set out above, use of the Opposed Mark by the Applicant in trade or commerce in respect of the provision of food or drink would be conduct that is misleading or deceptive or likely to mislead or deceive.

    The use of the Opposed Mark by the Applicant in relation to the provision of food or drink would contravene section 18 and section 29(g) and (h) of the Australian Consumer Law.

17. As previously stated the Opponent has failed to establish a ground of opposition under s 60 of the Act. The test for misleading or deceptive conduct under s 18 of the Australian Consumer Law (‘ACL’) is a more stringent one than that for deception or confusion under s 60,[29] and I find that the Opponent has also failed to establish that the Applicant’s use of the Trade Mark would be contrary to s 18 of the ACL.

    [29] See, e.g.: Ownit Homes Pty Ltd v Ownit Conveyancing Pty Ltd [2005] ATMO 47, [36]; Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191, 198.

18. In particular I note that the grounds of opposition particularised in the SGP refer to the possibility that the consumers would be mislead or deceive into thinking that the Applicant was associated with the Opponent. For the reasons set out in respect of the s 60 ground of opposition I consider this unlikely to be the case. It may be the case that use of the Trade Mark could be misleading and deceptive were the Applicant to use a hazelnut spread other than Nutella in the course of providing the Applicant’s Services, however the requirement under the Act is that use of the Trade Mark would, rather than could be contrary to law.

19. Paraphrasing the statement of the Registrar’s Delegate in A G Professional Hair Care Products Ltd v Geagroup Invest SRL[30], where a trade mark does not run afoul of s 18 of the ACL, neither will it run afoul of s 29 of the ACL. In Pacific Publications Pty Ltd v IPC Media Pty Ltd, Beaumont J considered—in connection with the superseded Trade Practices Act1974 (‘TPA’)—that ‘the Court’s conclusion on s 52 would necessarily carry with it a conclusion on s 53(c) and (d)’.[31] Sections 52 and 53 of the TPA were, respectively, the equivalent provisions to ss 18 and 29 of the ACL.

    [30] [2014] ATMO 65, [50].

    [31] [2003] FCA 104, [107].

    52. For these reasons I am not satisfied that use of the Trade Mark by the Applicant would be contrary to law. Therefore, the Opponent has failed to establish the ground of opposition under s 42(b).

    Section 62A

    53. Section 62A of the Act is reproduced below:

    62A Application made in bad faith

    The registration of a trade mark may be opposed on the ground that the application was made in bad faith.

20. The Explanatory Memorandum to the Trade Marks Amendment Bill 2006 provided some non-exhaustive examples of applications made in bad faith:

    ·persons who monitor new property developments, register the names of new developments as trade marks for a number of services and then threaten the property developers with trade mark infringement proceedings unless the developers licence or buy the trade marks;

    ·persons who have a history of applying for trade marks that are deliberate misspellings of other registered trade marks;

    ·persons who identify trade marks used overseas but with no Australian use as yet who then apply to register the trade marks in Australia for the express purpose of selling them to the overseas owners.

21. The case of Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) (‘Fry’) is a leading authority on this section.  In that case, Dodds-Streeton J made the following comments, quoting from Harrison’s Trade Mark Application[32]:

    [32] [2004] EWCA Civ 1028; (2005) FSR 10.

    Clearly the court, when considering bad faith, cannot apply a purely subjective test, called by Lord Hutton ‘the Robin Hood test’. The dishonest person or one with low standards cannot be permitted to obtain trade mark registrations in circumstances where a person abiding by a reasonable standard would not. The registration of a trade mark is designed to enable bona fide proprietors to protect their proprietary rights without having to prove unfair trading. Registration is not provided to help those with low moral standards.

    … The words ‘bad faith’ suggest a mental state. Clearly when considering the question of whether an application to register is made in bad faith all the circumstances will be relevant. However the court must decide whether the knowledge of the applicant was such that his decision to apply for registration would be regarded as in bad faith by persons adopting proper standards.[33]

    [33] [2012] FCA 81, [147].

1. Her Honour continued later in the same decision:

   The formulation in United Kingdom authority of bad faith as falling short of the standards of acceptable commercial behaviour observed by reasonable and experienced persons in a particular area is, in my view, an apt touchstone. An overly literal application may, however, tend to negate the relevance attributed to the applicant’s mental state in the combined test preferred in Harrison.

   Further, in my view, mere negligence, incompetence or a lack of prudence to reasonable and experienced standards would not, in themselves, suffice, as the concept of bad faith imports conduct which, irrespective of the form it takes, is of an unscrupulous, underhand or unconscientious character.[34]

   [34] Ibid [165]-[166].

2. Her Honour also noted with approval a number of cases in which bad faith were found in specific circumstances as set out below:

   In William Leith New Century Marquees (SRISO/018/00, UK Registry), the applicant applied to register a trade mark in respect of marquees, tents and related goods, although aware that NEW CENTURY was the opponent’s trade mark in the United States of America and that the opponent had started to trade in the United Kingdom under the trade mark. He was himself a customer and the delegate found that he should have been aware that the opponent could be expected to expand that trade, if it had not already done so. He had previously proposed a licence arrangement with the opponent although its terms were not clear. The delegate of the Registrar concluded:

   Mr Leith subsequently adopted the sign NEW CENTURY MARQUEES as his own trade mark, and he used it in the UK. When he was challenged about this he sought to register the mark in combination with his own name. In my view, the mark he has applied to register is confusingly similar with the mark NEW CENTURY.

   
   

   ...

   
   

   It is difficult to see how a person who applies to register a mark in his own name which he has previously recognised as the property of a potential overseas principal can be said to be acting in accordance with acceptable standards of commercial behaviour. I do not believe that combining the mark with the applicant’s own name is any answer to that criticism.[35]

   [35] Ibid [151].

   …

   In Hard Coffee Pty Ltd v Hard Coffee Main Beach Pty Ltd [2009] ATMO 26, Hearing Officer Nancarrow held that applications to register the trade marks HARD COFFEE MAIN BEACH and HARD COFFEE were made in bad faith within the meaning of s 62A, where a company controlled by the applicant’s controller had previously obtained a licence from the opponent’s predecessor in title to use the HARD COFFEE MAIN BEACH trade mark, acknowledging in that context that it had not purchased any right, title or interest in the names and that the vendor retained title to all related intellectual property rights. The Hearing Officer considered that in the circumstances, the director clearly understood that the trade mark in question remained the property of the opponent in respect of coffee shops.[36]

   [36] Ibid [153].

   …

   In Pritchard Pacific Pty Ltd Baltimore Aircoil (Australia) Pty Ltd v Brendan McCarrison and Breezewater Pty Ltd [2011] ATMO 46, the delegate upheld opposition to the registration of a trade mark for, inter alia, cooling towers and like apparatus and related services, on grounds including bad faith under s 62A of the Act. The delegate found that the applicant’s controller had a prior business connection with and knowledge of the opponent, such that a person standing in his shoes should have known that he should not apply for the registration of a trade mark deceptively similar to that used by his former business partner (at [42]).[37]

   [37] Ibid [156].

3. The Opponent has particularised this ground of opposition in the SGP as follows:

   4.1 Through their use in Australia, the Opponent enjoys a substantial and valuable reputation in respect of the Registered Marks in Australia.

   4.2 The Applicant’s adoption of a trade mark that could easily be confused with the Registered Marks is in bad faith as it is intended to gain the benefit of the reputation and goodwill developed by the Opponent in respect of each of the Registered Marks. The Applicant’s conduct falls short of the standard of reasonable and acceptable commercial behaviour.

4. The onus is on the Opponent to establish bad faith and it will not be found easily given the serious nature of the allegation.[38]  While it is clear that at the relevant date the Applicant was aware of the Opponent and its reputation in the Nutella Mark (indeed I find that the Applicant did intend to offer products made with Nutella at the relevant date) there is simply insufficient evidence before me to conclude that the decision of the Applicant to apply to register the Trade Mark (which, is not deceptively similar to the Nutella Mark) for a business intended to feature products made with Nutella, is an action of an unscrupulous, underhand or unconscientious character.  In particular I note that at the relevant date, the Applicant had not yet participated in Nutella-Palooza or received any guidelines from the Opponent about the use of the Nutella Mark so it could not be said that, in applying to register the Trade Mark, the Applicant breached any express or implied agreement with the Opponent.

   [38] Hard Coffee Pty Ltd v Hard Coffee Main Beach Pty Ltd [2009] ATMO 26, [12].

5. I find that the Opponent has failed to establish the ground of opposition under s 62A.

   Decision

   61.       The Opponent has failed to establish any of the grounds of opposition it nominated in the SGP.  Trade Mark application no. 1747769 may proceed to registration not less than one month from the date of this decision.  If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until either the appeal is withdrawn or discontinued.  Otherwise the disposition of the application should be in accordance with the Court’s order or direction.

   Costs

   62. The Applicant has sought an award of costs in its favour. I see no reason to depart from the general rule that costs follow the event. I accordingly award costs against the Opponent under section 221 of the Act in the relevant amounts under Schedule 8 of the Trade Mark Regulations 1995 (Cth).

   Nicholas Smith

   Hearing Officer

   Oppositions and Hearings

   18 September 2018

   Annex 1

   Class 16: Paper, cardboard and goods made from these materials, not included in other classes; printed matter; book binding material; photographs; stationery; adhesives for stationery or household purposes; artists' materials; paint brushes; typewriters and office requisites (except furniture); instructional and teaching material (except apparatus); plastic materials for packaging (not included in other classes); printers' type; printing blocks

   Class 29: Meat, fish, poultry and game; meat extracts; preserved, frozen, dried and cooked fruits and vegetables; jellies, jams, compotes; eggs, milk and milk products; edible oils and fats

   Class 30: Coffee, tea, sugar, rice, tapioca, sago, substitute of coffee, flour, pressing of cereals (excluded forages); bread, biscuits, cakes, pastry and confectionary, eatable ice-creams; honey, treacle, yeast, baking powder; salt, mustard, pepper, vinegar, sauces; spices; ice; spread creams; chocolate and chocolate product, specially pastry for chocolate beverage, chocolate pastry, coverings, in particular chocolate coverings, chocolate, praline, chocolate products for decorations of Christmas tree, goods substantial in chocolate covering eatable with alcoholic stuffed, sugar articles, pastry, chewing gum, chewing gum without sugar, candies without sugar

   Class 32: Beers; mineral and aerated waters and other non-alcoholic drinks; fruit drinks and fruit juices; syrups and other preparations for making beverages

   Class 33: Alcoholic beverages (except beers)

   Class 35: Advertising; business management; business administration; office functions

   Class 41: Education; providing of training; entertainment; sporting and cultural activities

   Class 43: Services for providing food and drink; temporary accommodation